Daryl Melham (Banks, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer update the House on the government's plan to create a stronger economy and a fairer society by making smart investments in our schools?

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

I thank the member for Banks for that very important question. Before I go into that in detail I just want to inform the House that the RBA, the Reserve Bank of Australia, has decided to keep interest rates on hold. What this means is that interest rates are now at record lows under this government. That is of enormous benefit to many people out there with mortgages and many people out there in small business. If you have an average mortgage of $300,000, you are paying $5,500 a year less on average than you were when Labor came to government—that is, when the others were in power. So lower interest rates are further evidence of the very strong economic management of this government.

We have put in place a fiscal policy which has given the Reserve Bank the flexibility to lower rates over time within an environment of contained inflation. That is absolutely essential so we can grow our economy for the future. Our economy has been growing: 13 per cent larger than it was at the end of 2007, with record low interest rates, and there have been 950,000 jobs created in that time. Of course, these are precisely the circumstances in which we should be making the very big, smart investments for the future, the ones which bring with them future prosperity, that lift our productivity and that lift our economic capacity. And nothing is more important in this regard than an investment in education. That is why our recent budget was so important, not just putting jobs and growth first but also making room in the budget for investments in education which will bring the great benefit to this country in the years to come.

That is why it is so distressing to see the Leader of the Opposition is in cahoots with the Premier of Queensland, actively coordinating an attack on extra funding which will flow to students in Queensland—extra funding which of course is going to flow to students in New South Wales. If we are going to win the economic race in the future, we have got to invest in education. That is something that the Premier of New South Wales understands, but not something the Premier of Queensland and not something the Leader of the Opposition understand. By their action, by staying with the old broken formula, they are going to deny $4.2 billion to the school students of Queensland over the next six years. What could be worse, what could be more reckless than that denial—the failure to invest in the future? It says everything about those opposite. They have not got a grasp of basic economics. They have not got a grasp of the investments we need to make for the future. They will starve the future, they will not make the necessary investments and in the process they will put their political interests before the interest of students in Queensland.