Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question is to the Treasurer. Can the Treasurer confirm that decisions he has taken since the election, like granting the Reserve Bank $8.8 billion, watering down tax integrity measures and keeping tax concessions for people with more than $2 million in superannuation, will increase this year's budget deficit by at least $9.2 billion, which will be reflected in Tuesday's fiscal update?

Joe Hockey (North Sydney, Liberal Party, Treasurer) Share this | Link to this | Hansard source

No. I will tell you why. Because the budget is presented on a four-year basis—he was the Treasurer! He was the last Treasurer! This is a revelation—a four-year basis. Secondly, we inherited a budget that did not properly reflect what was actually happening in the public sector.

Honourable Members:

Honourable members interjecting—

Joe Hockey (North Sydney, Liberal Party, Treasurer) Share this | Link to this | Hansard source

Oh! How about that? What a surprise. So we could not trust the Labor Party when they were in government, but now they are asking for a big trust—

Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

Madam Speaker, on a point of order: the Treasurer is reflecting on the Secretary of the Treasury and the Secretary of the Department of Finance, who released the pre-election fiscal outlook.

Mrs Bronwyn Bishop (Speaker) Share this | Link to this | Hansard source

There is no point of order.

Joe Hockey (North Sydney, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I do not think there were two people more relieved at a change of government than the Secretary of the Treasury and the Secretary of the Department of Finance: 'Phew, what a relief! We've got rid of that mob!' I will tell you what: when the MYEFO is released next week, it will show, to the shame of the Labor Party, the true state of the budget. Let us go back to this issue of the Reserve Bank. Somehow they think this is a game—

Ms Owens interjecting—

Mrs Bronwyn Bishop (Speaker) Share this | Link to this | Hansard source

The member for Parramatta will desist.

Joe Hockey (North Sydney, Liberal Party, Treasurer) Share this | Link to this | Hansard source

a game that we put $8.8 billion into the Reserve Bank. They are all about arguing the process. The bottom line is that they are not arguing the policy because they do not understand it. They are not that sophisticated over there that they should know. There are three major potential risks next year to the world economy: No. 1 is tapering; No. 2 is the stress tests on the European banks, which are significant; and No. 3 is the risk to the debt limit in the United States. They do not understand the ramifications of that in the Labor Party. They did not understand it when it happened before and they do not understand it now.

We have made sure that our institutions are at their strongest to deal with whatever lies ahead. I have put $8.8 billion into the Reserve Bank on behalf of the coalition government to make sure the Reserve Bank has all the ammunition it needs to deal with the challenges that lie ahead. That is what a good government does—it makes sure that you are at your best and can possibly withstand whatever the world throws at you. That is a good lesson for Labor. They did not get that in government. They did not understand that you have to be at your strongest. They took it for granted when they had a river of surpluses coming forward. They took it for granted when they had pockets full of money thanks to John Howard and Peter Costello. They took it for granted when they had an unemployment rate with a four in front of it.

What have they left? They have left endless deficit and debt that exceeds half a trillion dollars. They have left an economy with falling terms of trade and rising unemployment. The only thing holding it up are the expectations from the community that the coalition can do it better, and we will. (Time expired)