Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

My question is to the Treasurer. I remind the Treasurer that Joshua, Imogen, and Natasha, from Wanniassa Hills Primary School, asked him recently: 'Why is the budget so important?' Does the Treasurer recall saying: 'Just like mum and dad, we have to work out how much income we have and how much we are going to spend. You've got to make those sums add up.' Can the Treasurer confirm that if mum and dad ran their household budget the way he runs the federal budget, the bank would have foreclosed on them long ago?

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

The first thing that I would say in response to that question that was put is that mum and dad would have a mortgage, and mum and dad would probably have an average mortgage of $300,000, which means they would be paying $5,000 a year less than they were paying when the Liberals were last in power out at Wanniassa—$5,000 a year. Why do mum and dad have a mortgage? They have a mortgage because they want to make a significant investment in the most important asset they could have in their lives. And of course they cannot pay for it all at once. They should not necessarily try to do that if they want to provide their family with the best standard of living. They want to be able to afford some education. They want to be able to afford some health. They want to make other investments as well. So they take a common-sense decision to take out a loan and support their family, and pay it off as quickly as they possibly can.

The nation had a sudden and dramatic cut to its national income over the past five years. Suddenly, $160 billion went out the door. If you want to follow the logic of what the member is saying, what mum and dad should do in reaction to losing, say, $160,000 is sell the house and go and live in a tent. We say no to that kind of logic. What we did as a country was say: 'We should support our people. We should support mum and dad. We should keep mum and dad in jobs. We should ensure that their kids get the possible start in life. We should support our economy. We should get economic growth going.' Do you know what happens when economic growth gets going? You have a stronger budget. If you have more jobs, you have a stronger budget. Then you pay down your debt. That is what you do. And that is what mum and dad do, too.