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

My question is to the Prime Minister. I refer him to this morning’s comment on Perth radio station 6PR by Chris Richardson of Access Economics: ‘You can now say that the stimulus is too big.’ When will the Prime Minister wind back his reckless spending to take pressure off interest rates?

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

I thank the Leader of the Opposition for his question. I would have thought that here in 2009 at last the opposition could have said that the government’s stimulus strategy has succeeded in assisting Australia to remain out of recession, that at last the Leader of the Opposition could summon the courage to say that we have prevented hundreds of thousands of Australians from losing their jobs and that the government stimulus strategy has been remarkably successful by any global benchmark in preventing this economy from sliding into recession. These are the measurable achievements of what the government has done, in partnership with the business community and in partnership with the unions as well, in seeking to ensure that Australia came through this global economic crisis in the best possible repair, bearing in mind that we had so many economies around the world falling over one at a time. It is very difficult to know where the Leader of the Opposition actually stands on the question of stimulus. He draws attention, for example, to Access Economics today. The Access Economics report Business Outlook dated 19 October 2009 says, ‘Australia’s growth performance has been world beating.’ I do not seem to remember that being referred to in the quote by the Leader of the Opposition. Mr Richardson went on to say:

We didn’t dodge a bullet, we outran it … We sailed through the worst of the global crisis on a sea of stimulus—both our own and China’s.

That is what Access Economics have said. Access Economics also go on to say that there are still uncertainties out there in the global economy.

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 as to relevance. The question is not about the money he has already spent but about the money he is yet to spend.

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

Order! 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

Thank you, Mr Speaker. Access Economics have also said that there are still grave uncertainties which are alive out there in the global economy and they have specifically warned about what follows as stimulus tails down. They have specifically warned about the impact on small business and jobs. Therefore I would draw the Leader of the Opposition’s attention to one core fact, and that is the internal design characteristics of the stimulus strategy in the first place, which was designed to surge maximally at the very beginning of the crisis and then to tail down over time. Remember that the IMF, in October 2008, characterised appropriate fiscal stimulus in these following terms. It needed to be ‘timely, targeted and temporary for it to be effective’. If this government has embarked upon a strategy like this—which we have—then the results are there in the economic data for all to see.

I say to the Leader of the Opposition: he really needs to sort out where the opposition stand on the question of stimulus, because, when this debate on the global economic recession and Australia’s response to it began, they came out and supported it. Then after a period of time the member for North Sydney went out there and said they just wanted $20 billion less—remember that statement? It was in the lead-up to the budget of this year, I seem to recall. Since then we do not quite know where they stand, but it seems to be that they stand for 95 per cent of the stimulus which the government has embraced. That is actually what they say in substance, yet in the public debate they pretend they have not embraced any of that stimulus support whatsoever.

The bottom line is that, as of the June quarter this year, the government’s stimulus strategy has already peaked and is coming down consistent with its design characteristics. That is how it was put together in the first place. In phase 1 of the stimulus, we have already seen, I believe—I am advised—some 93 per cent of that already invested. By the time we get to the conclusion of this financial year, two-thirds of the stimulus will have been invested. That is what being targeted and temporary is all about—necessary to support jobs, necessary to support small business and necessary to support tradies. We are in the business of making a difference in the economy, and guess what? This government has acted in concert with each and every other government across the G20 economies in embracing a similar approach to stimulus. That is why we took concerted action as the G20 to inject $5.5 trillion worth of global stimulus into a $63 trillion global economy.

What is the alternative which the opposition would suggest? Their preference, when it is all stripped away, is to actually have people’s jobs destroyed. That is it in a nutshell. They would prefer to stand back and allow the economic, employment and human carnage to unfold. Their preference would be for unemployment queues to be snaking outside every Centrelink office in Australia, getting longer and longer, because they know, and all the analysts have said, that what makes up the difference is the stimulus strategy—together with the actions taken by the Reserve Bank in its monetary policy settings.

Our policy on this is clear-cut. It is consistent with the G20 global economies. We take jobs and the protection of jobs as absolutely core business for the future. Those opposite, it seems, now believe that people’s jobs can be just held to ransom, thrown down the drain. Forget the human consequences and—let me say this—forget also that in so doing they would be consigning Australia to increased pressures on the budget through rising unemployment benefits and declining taxation receipts as a consequence of higher unemployment.

What is the net result? This economy in Australia has produced the fastest growth in the OECD. It has produced the highest growth of the major advanced economies. It has produced the second-lowest unemployment of the major advanced economies. It is the only economy not to have gone into recession.

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

What about debt?

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

Right on cue, the member for Sturt says, ‘What about debt?’ The economy also has produced the lowest debt and the lowest deficit of all the major advanced economies. I thank the member for Sturt for his interjection.