Barnaby Joyce (Queensland, National Party) Share this | Hansard source

With the greatest respect, Minister, I do not think you have answered some of the crucial points of my question, so I will repeat them. We are going to have a $200 billion facility that you are going to have to finance. The expected cost of funds, as you believe at this point in time, is going to be around four per cent, but the more you go into the bond market the more you are going to force up the cost of funds for all Australians because of extensive borrowing. For every per cent you force it up, everybody with a $1 million facility pays an extra $10,000 a year and everybody with a $500,000 house loan pays an extra $5,000 a year. That is the reality that comes home to the kitchen table for everybody.

But here is the question. You are soon going to have a $200 billion facility. When you, on top of that, issue more bonds for an infrastructure package, which we envisage will be around $70 billion, are you therefore going to have a $270 billion facility? And if your cost of funds is at four per cent does that mean that there is going to be another amortisation on top of that—unless you envisage repaying the interest straight off the top. If you are going to amortise it out we are quickly going to get ourselves into a position of a bit better than $10 billion per year that is going to sit on top of that debt. So you are going to have $270 billion plus a multiple in excess of $10 billion—$280 billion. Within a year or two we will be up to $300 billion in debt. Dr Henry says that we cannot afford to get to $1 trillion, so we will be a third of the way there and we will have done it in a couple of years.