Tony Abbott (Warringah, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Prime Minister and it refers to the damage already being done by his great big new tax—the collapsing dollar, the falling stock market, the suspension of projects and the evaporation of jobs. I ask the Prime Minister: instead of a partial backflip tomorrow—

Opposition Members:

Opposition members interjecting—

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

I say to some who interjected just then from my left that I could have quite easily allowed the Leader of the Opposition to continue with the hubbub. The Leader of the Opposition has the call. He is asking a question. He will be heard in silence.

Tony Abbott (Warringah, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Prime Minister and it refers to the damage already being done by his great big new tax—the collapsing dollar, the falling stock market, the suspension of projects and the evaporation of jobs. I ask the Prime Minister: instead of a partial backflip tomorrow, will he finally act in the national interest and finally drop this great big new tax?

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

I welcome the question from the Leader of the Opposition on tax reform. I welcome the question because it is very, very difficult to understand where the opposition stands on tax reform. In the space of one week this Leader of the Opposition has said that mining companies pay too much tax, we have had the Deputy Leader of the Opposition saying they are paying just enough tax and we have also had the shadow minister for infrastructure—his big backer in the Senate, Senator Barnaby Joyce—saying they could pay more tax. Where does the opposition stand on these matters?

Can I go to the points that were raised by the Leader of the Opposition. First of all, his argument was that this was contributing to a reduction in the value of the Australian dollar. That is what he has said. That is the most reckless comment of many reckless comments he has made in this place. I quote to him the Westpac senior market strategist on this matter, who says, ‘The Australian dollar remained under pressure in the first half of Tuesday’s European trade over concerns about the Eurozone’s financial system and tensions between North and South Korea had investors selling high risk assets such as equities and commodities.’ Those remarks have been echoed also by the Chief Economist of RBS Morgans. That is the first point on the dollar.

The second is this: the stock market. This goes to the other point he has made. I quote him from an earlier remark when he said, ‘Our share market is under pressure because the government has totally mismanaged its proposal of a big new tax on mining.’ He said it was so, at least in part. Let us go to the facts of this matter. Share prices around the world have fallen because of the crisis in Greece and the honourable Leader of the Opposition would know that. Here are some discomforting facts for him. First of all, if we look at the stock market we see that Australian shares have fallen by less than in other countries over the past month. Since 30 April, the Australian Stock Exchange has fallen by 10 per cent, the London market has fallen by 10.4 per cent, the US Standard and Poor’s index by 11.5 per cent and the Japanese stock market by 12.8 per cent. That is fact one.

Fact two: let us look within the Australian share market itself and the performance of mining shares relevant to other shares. Australian mining shares have fallen by 8.9 per cent but all Australian shares have fallen by more than 10 per cent, the banks and financial institutions by 12 .3 per cent—that is, the second crux of his argument today demolished again by the facts.

He has said in recent times in relation to the cost of living, investment and growth and employment that the RSPT therefore has represented an impact on these and he particularly made reference today to employment. I say to the Leader of the Opposition on the facts again that this country, with an unemployment rate of 5.3 per cent, represents a rate of unemployment celebrated by the OECD today coming in at a level almost half that of many other major industrial economies and considerably less than most other members of the OECD, Japan being a notable exception. Again against the facts, given the strong employment performance of this economy against the statement just made by the Leader of the Opposition that this is therefore costing jobs, that flies again against the facts of the performance of the economy. Secondly, within mining itself he is yet to adduce any data to support the proposition.

So on proposition No. 1 about the dollar, on proposition No. 2 about the share price, on proposition No. 3 about employment: wrong, wrong, wrong, against all the factual data. That is because this Leader of the Opposition does not have any comfort zone at all when it comes to debating any matter of economic policy. He has said he is bored by economics. The former Treasurer of the Commonwealth Peter Costello said he could never be entrusted with the responsibility of the Treasury. So many of his colleagues from the previous Howard government have said that on matters concerning the economy he was financially irresponsible, that he could never be described as a fiscal conservative, that he has only spending proposals and no savings proposals, and yet we have the Leader of the Opposition now engaged in this debate. He stands utterly exposed by contribution of the facts.