Malcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is addressed to the Prime Minister. I remind the Prime Minister of his election campaign speech in November 2007:

… I am saying loud and clear that this sort of reckless spending must stop.

Given the Prime Minister has spent an additional $70 billion since last year’s budget, despite declining revenues, and that tonight his Treasurer will announce a record $58 billion deficit, I ask the Prime Minister: when will Australians stop paying the price for his failure to end Labor’s reckless spending?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I note that in the question which has just been asked by the Leader of the Opposition he makes no reference to the fact that this is a global economic recession and that the consequence, therefore, is that every responsible government in the world is seeking to respond to this global economic recession by taking action to reduce the impact on jobs within their economies and on small businesses and other businesses within their economies. That is this government’s strategy; it is the responsible course of action.

I would also draw the honourable member’s attention to the following. In terms of the impact of the measures taken by the government, I would draw his attention to the 1½ million Australians who, for example, work in retail and the impact of the government’s measures on retail sales in Australia—4.5 per cent higher than they were in November 2008. Contrast that with the following: a 2.5 per cent fall in the United States, a 3.1 per cent fall in Japan, a 2.2 per cent fall in Germany, a 1.7 per cent fall in New Zealand and a 3.1 per cent fall in Canada. And that is a direct consequence of government intervention in the economy.

Secondly, if we go to the whole question of building approvals and what is going on out there in the housing construction sector, the government has also taken action by trebling the first home owners grant, the first home owners boost. Those opposite always remain silent at this point because they do not know whether they are Arthur or Martha on this one, because the first home owners boost has been singularly successful in supporting activity in the housing sector. I draw the honourable member’s attention to this fact—that total building approvals rose for the second consecutive month in March, by 3.5 per cent. The increase in house approvals, up 3.4 per cent in March, is the highest monthly rise since March 2007. I would ask the honourable member to contrast that with what is happening with the housing sector in other economies also simultaneously affected by the global economic recession.

Furthermore, let us look at the impact of these interventions on the most recent survey of business confidence. The NAB business survey confirmed that the stimulus that we have delivered so far through this series of measures by the government is stabilising business confidence. Business confidence was broadly unchanged in April. I quote from the survey: ‘The results of the April survey represent the most encouraging set of numbers for some time.’

What do these various pieces of data indicate? They indicate the impact of measures taken by this government to cushion this economy from the worst effect of the global economic recession. Those opposite have one strategy, which is to do absolutely nothing—to sit on their hands and let the forces of unfettered markets rip and tear their way through working Australians, working families, right across Australia.

Those opposite like to engage in their boutique debate about these matters. But any responsible government in any place in the world will now be acting to reduce the impact of this recession on working families and communities everywhere. These are difficult choices. These are hard times. This is the worst global economic recession since the Great Depression three-quarters of a century ago. We have a strategy for the future. Those opposite have an excuse.

Brett Raguse (Forde, Australian Labor Party) Share this | Link to this | Hansard source

Mr Speaker, my question is to the Prime Minister. Will the Prime Minister further update the House on the impact of the global recession on Australia and the government’s response?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the honourable member for his question, because it goes to the global dimensions of what we are confronting at the moment. For those opposite who are interested in facts, as opposed to fiction or political opportunity, here is one for you: 32 out of the 33 most advanced economies in the world have been forecast by the IMF to contract this year. Secondly, eight out of 10 of Australia’s top trading partners are in recession now. This means, for this country, higher unemployment, and higher unemployment in practically every other economy around the world. Take the United States alone, where they have lost some 5½ million jobs since the beginning of 2008. That is what is happening in the world. What is this government’s strategy? It is to support jobs, small business and apprentices today by investing in the nation-building infrastructure our country needs for tomorrow. That is our strategy.

What have we done in terms of practical effect? In financial markets in Australia we have acted to provide guarantees for the deposits of each and every Australian in their banks, their building societies and their credit unions, in order to underpin confidence in our financial markets. Secondly, we have reinforced those interventions by the work we have done collaboratively through the G20 to assist in stabilising global financial markets.

This government has also invested directly in infrastructure measures. Some 70 per cent of this government’s economic stimulus in nation-building infrastructure has been invested precisely in those assets which our country needs to build productivity and economic growth in the future—supporting jobs, supporting apprentices, supporting small businesses across our country. This is nation building for recovery: investing in urban rail; investing in roads; investing in ports; investing in the largest school modernisation program our country has ever seen, to boost productivity; investing in a national broadband network; and investing in skills. We are currently investing in one of the largest expansions in the skills base that this country has ever seen, including investment in some 711,000 new apprenticeships, TAFE places and VET places. Through this we are also implementing much-needed reform because, during this difficult time of economic downturn, for every person under the age of 25 we have a very simple principle: we expect under-25s in this period to be either earning or learning. And we are providing the training places across the nation to turn that principle into reality.

Because of the global recession there has been something in excess of a $200 billion collapse in government tax revenues, which means that the government has lost the equivalent of one dollar in every five in tax revenue to the Commonwealth. Two-thirds of this government’s temporary deficit is made up from the collapse in taxes caused by the global recession—a temporary deficit supported by the $180 billion debt and deficit plan embraced by the Leader of the Opposition; the Liberals’ debt and deficit plan. Two-thirds of this government’s temporary deficit is made up from the collapse in tax revenues—one dollar in five—

Dennis Jensen (Tangney, Liberal Party) Share this | Link to this | Hansard source

Dr Jensen interjecting

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

Order! The member for Tangney!

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

brought about by the global recession. The bulk of the remaining one-third in the government’s temporary deficit is through the investment in the infrastructure we need for tomorrow. This is the question that makes those opposite always squirm when asked to answer: if they are not borrowing against the collapse in tax revenue then which portfolios of government—not ‘which programs’—would they cut? Because $200 billion, the equivalent across the forward estimates of something like $50 billion a year, is about equivalent—

Dennis Jensen (Tangney, Liberal Party) Share this | Link to this | Hansard source

Dr Jensen interjecting

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

Order! The member for Tangney is warned!

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

to what we spend at present on the entire health and hospitals budget. So, Leader of the Opposition, if you are going to stand here and pontificate and say that you are not going to borrow to offset against a collapse in tax revenue, name the portfolio, not the program, you are going to abolish. It is either the entire hospitals funding from the Commonwealth to the states, 2½ Defence budgets or more than the entire education spend and a whole lot on top.

These are the decisions that we confront in the period ahead. Those opposite always resile from positive news. Did you notice how they disappeared last week when there was, for the month that has just passed, some positive news when it came to unemployment? The Leader of the Opposition disappeared into the abyss; he was not to be seen. The member for North Sydney—

Malcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order. I was actually in Western Sydney at a Salvation Army launch—

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

Order! The Leader of the Opposition will resume his seat!

Malcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

Is the Prime Minister saying that the Salvation Army—

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

Order! The Leader of the Opposition will resume his seat! The Prime Minister has the call and he will be heard in silence.

Malcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

Mr Turnbull interjecting

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

Order! The Leader of the Opposition is using up any goodwill.

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

It appears that the Leader of the Opposition—

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order. Could the Prime Minister table that part of the speech he has been reading from—

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

The member for Mackellar will resume her seat. The member has been here long enough to know the proper procedures.

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

The opposition—the Liberals—hate it every time there is positive news on the economy because they find that it does not suit their political agenda. It might be consistent with where we want to see the national economy go and where every right-thinking person in the country wants to see our economy go, but it does not suit their political agenda. So when the unemployment data came out last week the Leader of the Opposition was nowhere to be seen, but suddenly ‘Hockey Joe’ appeared and reluctantly took the microphone.

There was positive news also in terms of retail sales, which I referred to before, and housing finance commitments are up. The ABS reported today that the number of owner-occupied housing finance commitments rose by a solid 4.9 per cent in March. That is ABS data that is out today. The number of owner-occupied loans is three per cent higher than it was a year ago. This is the first time that there has been positive through-the-year growth since January 2008. First home buyer activity continued to grow with the proportion of owner-occupied loans for first home buyers increasing to 27.3 per cent, the highest since records began. To quote Westpac, households are responding ‘to extremely low interest rates and generous incentives for first home buyers’. UBS economist Scott Haslem said:

Overall, today’s housing lending data is unequivocally strong.

Similarly, a report again today from the business confidence survey stated that the situation remained unchanged in April.

These elements go towards underpinning one core proposition: a government committed to reducing the impact of the global recession on Australia. If you take a concerted series of measures it will have an effect. Our overall strategy is plain: we are going to continue to support jobs, apprenticeships and small businesses in this economy by investing in the nation-building infrastructure we need for the future.

Christopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order. The Prime Minister has now been speaking for over seven minutes. You have spoken yourself about the need for short answers. How can you expect the opposition to maintain its decorum in the face of this extraordinary performance on the part of the Prime Minister on budget day? It is time to get on with the next question.

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

The member will resume his seat.

Opposition Member:

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

There is an expectation, no matter what provocation might be perceived, that people behave properly. I do not think the Manager of Opposition Business is actually helped by interventions after his point of order. There are no points of order about length of questions on the public record with comments about that. But I do not wish to pursue them today. The Prime Minister has the call and he should be heard in silence.

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

Our strategy is clear, and that is to support jobs, apprenticeships and small businesses today by investing in the nation-building infrastructure our country needs for tomorrow. That is what we are doing and, in every state of our great nation that I visited in the last six or seven weeks during which we have not been in this place, the response on the ground has been from communities saying: ‘We are glad to see school construction being commenced here. We are glad to see this local government project commencing there. We are even glad to see a sports project commencing in the electorate of Wentworth.’ The local member, it seems, having voted against funding for infrastructure projects, then has the gall to show up and say ‘me too’ in support of that particular project.

Wherever you go across the country people are saying: ‘At least we have a government in there having a go, supporting local projects, making a difference on the ground, supporting skills in their communities and supporting the construction of new homes, as opposed to an opposition that pretends it has an alternative strategy when in fact its alternative strategy is politics, politics and politics.’