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

My question is to the Prime Minister. Does the Prime Minister agree that the positive GDP figure for March is almost entirely a consequence of a substantial decline in imports and an increase in exports, providing a 2.2 per cent contribution to GDP growth from net exports? If so, could the Prime Minister explain to the House how his spending policies over the last six months have influenced an increase in exports and a decline in imports?

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

The regrettable thing about the question from the Leader of the Opposition is that it is about as misleading as their negative campaign on debt and deficit. Do you know why? In the negative nature of the question just asked he left out one key factor, and that is the positive number on consumption—because it did not fit the political script he was seeking to advance. What did consumption do in the Australian economy in the quarter just passed? It rose by 0.6 per cent. That is what happened to consumption. Why does the Leader of the Opposition think that that happened? Did it happen because there were pixies at the bottom of the garden? Did it happen because he was pulling things out of space? No. It happened as a deliberate construct of government policy. The government has acted in the economy to boost consumption.

The Leader of the Opposition never likes being confronted with simple facts. The fact is that consumption has been affected in the Australian economy because we acted on the basis of the advice of the Treasury last October to support households, to support pensioners, to support carers and to support veterans by making direct cash payments to them. That was the strategy we took, and it had an effect on the economy in those two quarters most particularly of concern—the fourth quarter last year and the first quarter this year—and into the second quarter this year. Direct cash payments supporting consumption were the best way ahead. The Leader of the Opposition, again, if he was reflecting honestly on what happened with the retail sales figures in the last week or so, would note the fundamental difference between retail sales being up here, by in excess of four per cent—

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 going to relevance. The question was about net exports. If the Prime Minister could stop talking about himself and focus on the economy, we would get a relevant answer.

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

The Leader of the Opposition will resume his seat. The Prime Minister is responding to the question.

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

Again, it is a sad day when the Leader of the Opposition and the Treasury spokesman are the only two people in Australia unhappy today about positive news for the Australian economy. That is what is sad about the response being adopted by those opposite. I would have thought that, in the midst of a grave external economic challenge to Australia, those opposite would find it within themselves to actually rise to the occasion and say something positive about the economy.

The Leader of the Opposition’s question was predicated exclusively on the question of net exports, and that is the assumption which I am seeking to confront. It is a false assumption because it omits any reference to consumption. How is consumption being supported? By the direct action of the government. How is that reflected in the data? By a four-per-cent-plus increase in the retail sales data compared with a one-per-cent-plus contraction in average retail sales data across the other major advanced economies. This has not happened by chance. It has happened because the government has acted through deliberate policy. Those opposite, if they were being honest about it, would recognise that fact. That is why the government’s strategy of nation building for recovery will continue in the future, in three phases: cash payments to support activity in the economy in those critical quarters following the implosion of the global economy in the fourth quarter last year; medium-term infrastructure build through the commencement of the biggest school modernisation program in the country’s history; and then our long-term infrastructure investment, which we outlined in the budget most particularly recently.

This is a nation-building strategy for recovery, a positive strategy for Australia’s future, as opposed to a strategy which is entirely political—all about talking the Australian economy down. I would challenge those opposite to rise to the national occasion and be positive, at least for one day, in their negative campaign against the interests of Australian working families.