David Feeney (Victoria, Australian Labor Party) Share this | Hansard source

I have to congratulate the opposition today for having the audacity to move this motion. The day after Treasurer Wayne Swan brought down a budget that has been widely praised for its fiscal responsibility and that forecasts a drop in government spending as a proportion of GDP, those opposite want to lecture the Labor government for so-called reckless spending. The day after the budget in which the Treasurer announced cuts to the rate of company taxes for Australian small business and also announced measures to simplify the Australian taxation system for Australian taxpayers, the opposition want to criticise this government for so-called high taxation. To be moving this motion today, takes cheek of a very high order.

Far from criticising the government on the issues of spending and taxation, the Senate ought to be congratulating the Prime Minister and the Treasurer for having brought down a budget which manages to be fiscally very prudent while providing increased investment in areas of high priority, particularly health. Such a high level of responsibility in an election year is very rare indeed—and certainly unknown during the Howard-Costello-Abbott government, when election year budgets were notorious for an orgy of pork-barrelling in marginal coalition electorates, for continuing extensions of middle-class welfare and for unaffordable tax cuts for the already well-off. You will recall that Prime Minister Howard very famously in 2004 managed to spend $94 million a minute during his election speech. It was a Prime Minister who never feared to spend taxpayers’ dollars to get himself re-elected.

The economic data which the Treasurer tabled last night confirms the basic facts about our economic situation, facts which the opposition is doing its very best to ignore. This data confirm that Australia is recovering from the global economic downturn more rapidly than expected and more rapidly than virtually any other country. The budget forecasts are a return to surplus in 2012-13—three years earlier than anticipated as growth returns to trend. The budget also tells us that unemployment has fallen and will continue to fall—something that those opposite do not seem to be very interested in.

At the time of last year’s budget, the unemployment rate was rising and was forecast to peak at 8.5 per cent. Let me remind those opposite that today we have a five per cent unemployment rate. Furthermore, that rate is falling. Meanwhile, France has an unemployment rate of 10 per cent; the United States, 9.7 per cent; the United Kingdom, eight per cent; Germany, 7.5 per cent; and New Zealand, 7.3 per cent. We have a record in this critically important area that we can be very proud of indeed. As we have seen in recent weeks, the economic crisis in Europe is far from over and unemployment will keep rising in most of those European countries as their economies continue to lag. The US economy is still in a very fragile state. We are almost alone in having returned to growth and in having excellent prospects of continuing growth. As the Treasurer rightly said last night, we have an economic and fiscal position which is the envy of the developed world.

Let me remind the opposition of some more facts. During 2009, the advanced economies, taken as a group, saw their economies contract by over three per cent, while Australia grew by 1.4 per cent with only a single quarter of negative growth. If the 1991 recession was the recession we had to have, then Wayne Swan can take the credit for this being the recession we did not have. It is also the recession we could have had. According to Treasury, without the government stimulus measures we would have gone backwards by 0.7 per cent during 2009. Also, thanks to the government stimulus measures, our recovery from the downturn has been more rapid than predicted. This time last year the forecasts for the 2009-10 financial year was negative growth of 0.5 per cent. Now we expect the figure to be a positive growth number of two per cent.

None of this happened by accident. It happened partly because of continuing high demand for our exports from China and other Asian countries, and no-one will deny that, least of all us. But it also happened because of the bold, rapid and well-targeted response of the Rudd government to the global financial crisis. When the crisis struck in September 2008, the government acted boldly and quickly, on the best economic advice, to stimulate the economy to preserve jobs and save businesses from bankruptcy. The advice from the Secretary of Treasury, Dr Ken Henry, said, ‘Go early, go hard, go households,’ and that is what this government did.