Arthur Sinodinos (NSW, Liberal Party) Share this | Hansard source

All I can say is that on this side of the chamber we have a Rolls-Royce of an opposition leader, who hopefully will be the future Prime Minister, and look at the competition between Holden and Ford on the other side.

In more than four years in office, Labor has failed to convince the Australian people that they are better economic managers than the coalition. If they had managed to do that they would be in a far better electoral position than they are now. Something is wrong, and it began in opposition. Labor failed to make an economic case against the former government when in opposition. Most of you who recall that period will recall that shadow Treasurer Swan, as he was then, really struggled to make an impact on Treasurer Costello. He really struggled because he failed to make an economic case, and by the time of the 2007 election all that Treasurer Wayne Swan was able to do was, essentially, to say that he would carry on the economic policies of the previous government.

What we have seen in the period since then if we look at any set of economic indicators—whether they are the Commonwealth budget balance; net government debt; net debt as a proportion of GDP; net government interest payments; government expenses as a proportion of GDP; the unemployment rate; the increase in employment; long-term unemployed; average annual personal bankruptcies; annual GDP growth; average annual GDP growth; inflation; new private business investment; retail turnover; productivity growth, in particular, labour productivity growth; mortgage rates; and monthly repayments—is that on all the indicators the Howard government scrubs up very well against its successor.

There was no economic narrative, and they have now come to rue that in government. One of the things that they did in opposition was to push cost of living as a very important issue. They promised us Fuelwatch and GroceryWatch, and we got them when they were in government. And what did we get? Both were closed down very quickly because both were gimmicks. And yet today, if there is anything on which Labor is hoisted on its own petard, it is the cost of living. That is the thing that has come back to bite the government big time: the cost of living through the impact of the carbon tax on the cost of living.

Leaving aside the general question of policy confidence and the capacity of the Prime Minister and the Treasurer to make their economic case, it is blowout in debt to accommodate the spending associated with the global financial crisis that has haunted Labor ever since. No-one on this side quibbled with the idea of an initial stimulus. It is a furphy to say that the opposition was against any form of stimulus, but it was the fact that programs were instituted that could not easily be turned off and that, on any reasonable cost-benefit analysis, were too expensive for the benefits being obtained.

Remember how quickly funding for pink batts and Building the Education Revolution went out the door, and the waste which followed? Remember how the former Prime Minister signed off on the biggest infrastructure program in our history on a RAAF VIP flight to suit his hectic travel schedule, and without the benefit of a proper cost-benefit analysis? Under pressure over this massive commitment, Senator Conroy belatedly produced an estimated rate of return akin to the long-term bond rate—about six per cent. He argued that there were many benefits that could not yet be quantified. But the government's own handbook on best practice in regulation requires the use of a higher rate of return to capture the opportunity cost of funds. Both the minister and the then Prime Minister had no idea that the long-term bond rate does not constitute such a return, particularly for major projects of this size and risk—again, a reference to their own lack of commercial experience and qualifications. Is it any wonder that Labor have not yet produced a surplus?