Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Hansard source

I rise to speak in support of this motion. It has been noted that every Australian with a pulse—or perhaps more appropriately a vote—has benefited from a fistful of dollars courtesy of the Howard government in this year’s budget. However, apparently there are not any votes in productivity, because this budget comprehensively fails to take the steps necessary to turn around Australia’s lagging productivity growth. Productivity growth is fundamental to our future prosperity. Productivity growth means increased economic growth, which means improved standards of living for Australians and for Australian society. Improving Australia’s productivity is the best way to improve our competitiveness and to keep the Australian economy growing. The fact that Australia’s productivity growth has stalled is a serious concern for Australia’s future economic prospects.

The budget papers paint a grim picture of Australia’s future productivity performance. According to the budget, productivity growth in 2006-07 was zero. Let me repeat that: our productivity growth this financial year was zero. Further, the budget papers forecast productivity growth of an anaemic 1.75 per cent per annum over the final two years of the forward estimates—so much for the productivity nirvana that was supposed to be ushered in by Work Choices. In fact, according to Treasury’s own figures, Australian productivity growth will average a mere 1.5 per cent per annum in the five years following the introduction of Work Choices. After 11 years in office, the best the Howard government can do is a forecast productivity growth rate of just 1.75 per cent in the final two years of the forward estimates. This is barely half of the productivity growth rate achieved by Labor in the 1990s. Given that Treasury forecast productivity growth of 2.25 per cent for 2006-07—only for us to now find that the actual figure was zero—it may be that Australia’s actual performance may be even less than the forecast meagre 1.75 per cent.

Let us be clear: Treasury forecast for this financial year growth of 2.25 per cent and the actual figure is zero. So why is Australia’s productivity growth rate so poor? Well, as Labor has been arguing for many years now, the Howard government’s failure to invest in Australia’s productive skills and infrastructure, over 11 long years of government, is choking off Australia’s productivity growth. The Howard government’s preference for short-term politically motivated quick fixes over making the investments necessary to sustain the nation’s long-term prosperity, has left Australia poorly prepared for the future. The Howard government’s arrogance and complacency through the windfall of the mining boom has left Australia unprepared for when the extraordinary luck we have enjoyed through geological providence dries up. The 2007 federal budget is a shining example of the way that the Howard government has failed the future test. This budget reveals—