Laura Smyth (La Trobe, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer update the House on today’s national account numbers and what they say about the performance of our economy.

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

I thank the member for La Trobe for her question because the Australian economy grew by a solid 0.7 per cent in the December quarter and by 2.7 per cent through the year. This is further confirmation that the economic fundamentals in the Australian economy are strong despite some soft spots in the economy and, of course, recent natural disasters.

Today’s figures are underpinned by a very strong export performance. Exports contributed 0.7 per cent to the quarterly outcome despite wet weather in December. Inventory growth contributed to today’s outcome as well reflecting a large build-up in agricultural production. We also saw strong growth in machinery and equipment investment, which increased by 4.7 per cent—the first quarterly increase since the small business and general tax break ended in 2009.

If we look past the lumpiness in engineering construction, the fact remains that engineering construction is 12.4 per cent higher over the year. This confirms that there is a surge in engineering construction underway. This builds on the very strong capex figures that we have seen in recent days. There is something like $129 billion planned in capital expenditure for 2010-11 and, of course, more for 2011-12.

So today’s outcome is a good outcome for Australia. It should be welcomed by those opposite, but of course it is not because, as we know, they are economically illiterate and they are simply not interested in some of the basic facts about our economy. When we look—

Opposition Members:

Opposition members interjecting—

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

Order! The Treasurer has the call.

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

I would have thought those opposite should be interested in the national accounts. It goes to the core of our prosperity, it goes to the core of our capacity to create jobs, it goes to the core of dealing with the natural disasters that have so affected so many of our communities, it goes to our future prosperity—and I would have thought that those on that side of the House might have had some interest in these basic facts.

One of the impacts of the natural disasters is that they will be felt particularly hard in the March quarter. They are going to reduce output by something like $7 billion in the March quarter. That is a challenge for our economy, but it is a challenge we are up for. It is a challenge we can deal with because of the way in which we have built strength in our economy over recent years, the way in which the government responded to the global recession, the way in which we supported small businesses, the way in which we supported employment and the way in which we supported confidence in our economy. The consequences of that are an unemployment rate of five per cent and the creation in Australia over the last year of 330,000 jobs—a job creation effort the envy of the developed world. That means there are more Australians taking pay packets home, more Australians supporting their families, more Australians living in greater security because we got the economic decisions right—the fundamental economic decisions for the future of this country.

Because we are in a strong position, we can handle the savage impact of these national disasters, particularly as it will be felt in the March quarter, so we can rebuild for those people in Queensland, rebuild for those people in northern New South Wales and rebuild for those people in Victoria because we have got a responsible attitude to dealing with the fiscal challenges, to adhering to our strict fiscal discipline and to supporting our communities. (Time expired)