Kerry Rea (Bonner, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Treasurer, what have been the recent comments about monetary policy in Australia?

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

I thank the member for Bonner for her question, because the Australian economy has outperformed virtually every other advanced economy during this global recession. I think that is something that all Australians are proud of—the performance of our economy during this global recession; the fact that we have created in Australia, together, over 180,000 jobs; and the fact that we continued to grow as other economies were falling into recession.

We have had some judgment about this from the OECD, who put a report out last week. They remarked particularly on the performance of the Reserve Bank—and of course on the performance of the government, in terms of the measures that we took to stimulate the economy. They highlighted the role that monetary and fiscal policy has played in supporting our economy during this global recession. We get some commentary from those opposite that the performance of the Australian economy is due to a whole lot of things other than monetary and fiscal policy. It is true that the very good regulation of our financial system has played a part. It is also the case that strong growth in the Asia-Pacific has been important. But what we see in the OECD report is their belief that monetary and fiscal policy domestically here was absolutely fundamental. They made this point:

This would not have been enough if monetary and fiscal policies had not been developed progressively to respond to the crisis. These have in no small part shielded businesses and citizens from the initial damaging impacts of the global recession.

Of course there has been a bit of commentary around monetary policy. We had the shadow Treasurer running around the place last week, peddling his phoney claims about some link between current spending and interest rates. As we know, Tinkerbell over there was repudiated fundamentally by the Reserve Bank governor in his evidence to the committee only last week—and, of course, was also repudiated fundamentally by the OECD. This is what they said about what interest rate rises in Australia have reflected:

… the relatively favourable trends experienced by the economy over the recent period and the reduction of the large global downside risk which prevailed until mid-2009.

So, like the Reserve Bank governor, they have completely repudiated the point that has been made by the shadow Treasurer. Of course, sometimes there is a little bit of honesty from Tinkerbell—

Opposition Members:

Opposition members interjecting—

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

It just slipped out. Sloppy Joe let it slip out.

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

Order! On this occasion, the Treasurer will withdraw and he will refer to members by their titles.

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

I withdraw. A letter from Joe Hockey, the shadow Treasurer, to the editor of the Financial Review, says:

The Reserve Bank of Australia recognises that this is no longer appropriate and is now in the process of moving interest rates back to more normal levels over a relatively short period of time.

He will tell the truth in the Financial Review, but he will not do it on talkback radio. He is constantly out there talking down our economy, and what he will not say is that interest rates are now 300 basis points lower than they were when the Liberals were last in government. I know he thinks he can wave that magic wand and put interest rates back at 1967 levels, but economic policy does not work like that. What we are getting from those opposite is a risky, extreme commentary which talks down the economy. On this side of the House, we will continue to support employment and small business to continue to support the Australian people and their continued employment.