David Bradbury (Lindsay, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer update the House on recent analysis of the government’s economic policies, including the Nation Building and Jobs Plan?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for Lindsay for his question. It is a very important question; it goes to all of the steps that this government has taken to restore and reinforce confidence in our financial system and to maintain stability in our banking system, including guaranteeing bank deposits and wholesale funding. And, of course, it goes directly to the point that the Prime Minister was making before about our Nation Building and Jobs Plan, which has been put in place in response to events in the international economy in recent times.

All of these measures have been absolutely essential for maintaining stability in the wider economy and in the financial system, and this program has had the support of respected economists the world over; certainly, last Friday we had the benefit of hearing the views of the Governor of the Reserve Bank. Those opposite have been questioning the rationale for this program. There has been question after question in this House about whether there was sufficient stimulus—too much, too early, too late and so on. I think the governor had a number of very important things to say, and the most important thing that he had to say on Friday was:

Growth will be stronger than it would have been without those actions. I do not think there is any doubt about that.

We have had the deputy shadow Treasurer, the Leader of the Opposition and others all making points about our Nation Building and Jobs Plan. The first thing that they have been saying is that our Economic Security Strategy that was announced last August did not work. What did the Governor of the Reserve Bank have to say about this last Friday? He said:

I think the indications are that the pre-Christmas package did have quite a measurable impact on consumer demand.

How many times have those opposite come into this House and said it did not have a measurable impact on consumer demand? Despite the retail sales from December, despite the evidence from Woolworths, Westfield and so on, they continue to say that in this House, and of course it is untrue. You have heard a lot from those opposite about the bank guarantee and how ineffective it was, how bungled it was, how it does not work and how it is not necessary. This is what the governor had to say last Friday:

… the decision, by and large, did what was needed, which was that it avoided any perception of a systemic problem in the Australian banking system …

…            …            …

That is a very much better outcome than we might have otherwise had.

And, of course, we have heard from them—we heard it again today, in fact—that the Nation Building and Jobs Plan is excessive. They claim we are spending too much, that there is too much investment in schools. Indeed, the deputy shadow Treasurer thinks the investments in schools are ridiculous. What did the governor say on Friday? He said:

… it does not strike me as obvious that somehow it is grossly excessive.

This is another exposure of the naked political point-scoring that has been coming from those opposite. Every time they bowled up another one of their shonky assertions it was exposed for what it was by the Governor of the Reserve Bank. Their claims about doing too much were smashed; their claim the ESS did not work was smashed; their claim that the bank guarantee is not needed was completely smashed. The ultimate came when the deputy shadow Treasurer asked the governor a question about whether we were spending too much too soon. This is what the governor said:

You can make that argument, but I think you can also make the argument that, the longer you wait, the more ammunition you will end up having to use. These things can get a sort of self-fulfilling momentum behind them and we may or may not be able to head that off. But I think you should try …

Of course the approach of those opposite is simply to sit and wait and see, because they do not understand that if you do not act early then you do not avoid some of the catastrophic effects that come down the track, particularly the tragedy of much higher unemployment. There could not have been a more humiliating debut for the deputy shadow Treasurer—

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! The Treasurer knows his obligation to refer to people by their parliamentary titles.

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

than there was on Friday before the Governor of the Reserve Bank. It just shows that the shadow Treasurer needs to do some hard work, needs to check his facts, needs to delve into the economic research. You cannot have an approach like the opposition has, which is simply to wait and see. Those opposite have not got a clue about what needs to be done. They do not have any ability to judge the magnitude of the problems that this country is facing, given the nature of the global recession. But the proof was there. It was exposed last Friday by the Governor of the Reserve Bank. Those opposite should start doing their homework and get into a position where they can say something that is responsible and helps the country, not hinders it.

Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

Referring to economic research, my question is to the Treasurer. Does the Treasurer stand by his statement that a substantial proportion of pink batts to be installed in up to 2.2 million homes will be made in Australia? If so, how does the Treasurer explain this report from Citigroup—economic research—which states that the Rudd plan on pink batts:

… far exceeds domestic capacity to supply—

and that—

To implement the Rudd plan, vast imports may have to be ordered.

Moreover, the research states:

If the Rudd plan gets implemented, CSR could permanently lose this end market in 2.5 years.

Treasurer, why is it a good idea for the government to put Australian taxpayers into debt in order to put Australian workers out of a job? I seek leave to table this report.

Leave not granted.

Opposition Members:

Opposition members interjecting—

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! The Treasurer has the call.

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I certainly do stand by that statement, and I understand that the opposition are opposed to our Nation Building and Jobs Plan. They would rather see higher unemployment than see some temporary constructive action that leaves a lasting legacy for the country. The cabinet did discuss this issue when we were considering this tremendous initiative to increase energy efficiency. We did have a look at the capacity of the domestic industry. We had a look at the number of domestic producers, and it is the case that there will be domestic producers who will be substantially expanding their production. They have said that to the government and I am sure they have said that to the minister behind me. They certainly will. There is no doubt there will be some imports. There is no doubt about it at all, but the great bulk will be manufactured domestically. The deputy shadow Treasurer—

Opposition Members:

Opposition members interjecting—

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! The question has been asked and it is being responded to.

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

The deputy shadow Treasurer was relying on a report from Citigroup. I have not read the report from Citigroup, but there is another report that the deputy shadow Treasurer has been using—from ABN AMRO—on our stimulus package, and I can tell him, ‘Don’t use it any more because it is just completely wrong.’ So it may well be that the figuring in this report is not right, but we will go away and have a look at it and look at the basis on which they made their calculations. But those opposite will take any opportunity to pointscore about what is a very serious initiative to create jobs in this country. The installation of pink batts is labour intensive and we can do it at a time when it will bring a tremendous economic benefit to this country. The installation of these batts is the equivalent, over time, of taking one million cars off the roads. So it is a very important energy efficiency initiative, but it is also a very important job creation initiative. All of these questions are really about them trying to wriggle out from underneath the fact that they are completely opposed to our Nation Building and Jobs Plan—a plan which is absolutely the right thing to do by this country. We have the endorsement of the Business Council of Australia, the Australian Industry Group, ACCI and other small business organisations, but not of the federal opposition. It just shows you how negative they are and what policy alternatives they do not have.