Alan Ferguson (SA, Deputy-President) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer, Senator Conroy. Given the Treasurer’s admission last night that Australia’s economic growth will be lower than the MYEFO forecast of two per cent, what is the government’s latest growth forecast?

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

The government has taken early and decisive action to strengthen growth and support households during the global financial crisis. If global conditions continue to worsen, there will be a further slowing of growth and a further impact on budget revenues. We have said that, if that slowing occurs, the responsible thing to do will be to draw down on the surplus and if necessary use a temporary deficit to invest in growth. MYEFO was published just a few weeks ago and we stand by those forecasts. But any action to use a deficit would be temporary and consistent with the budget discipline of maintaining a surplus across the economic cycle. This action would support growth and jobs. Failing to act, as those opposite are now advocating, would be irresponsible and would sacrifice growth and jobs. There is not a single credible economist in this country who does not share that view.

It is because we have made the hard yards in the budget to build a strong surplus that we now have the flexibility to respond to the deterioration in global conditions. It means that fiscal policy is working in tandem with monetary policy to support growth during the global financial crisis. In times like these you need a decisive government staying ahead of the game, not an opposition who try to have it both ways. (Time expired)

Alan Ferguson (SA, Deputy-President) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I remind the minister of the fact that, as recently as last Monday, the Treasurer said:

We stick by our forecasts. There are many forecasts out there but the official forecasts of the Commonwealth are for moderate growth and modest surpluses.

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

Senator Conroy interjecting—

Alan Ferguson (SA, Deputy-President) Share this | Link to this | Hansard source

You have said it about three times, Minister. What new information has the government received in the past three days that has caused it to panic and abandon its forecast and predict a temporary deficit?

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

Notwithstanding the fact that those opposite are again taking an irresponsible approach on the subject of the economy, it is interesting to look back at what the Leader of the Opposition has previously said about the intensification of the global crisis:

There is nobody that would have predicted these events a year ago or even a few months ago. We have seen remarkable events right around the world—bank failures in the United States, in Europe—very big challenges and, you know, we cannot … we cannot underestimate the gravity of the challenge.

That was the Leader of the Opposition’s press conference on 30 September 2008. Those opposite ask: what has happened? Mr Turnbull himself has indicated that there have been significant changes— (Time expired)

Alan Ferguson (SA, Deputy-President) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Perhaps I could remind the minister that there is nothing irresponsible about asking ministers questions about the government’s actions. Given that MYEFO was out of date in less than a month, how can the Australian people be expected to believe that the government can predict economic growth 40 years from now, as it is asserted in its emissions trading modelling?

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

The government, as I said, stands by the MYEFO forecasts released on 5 November. We stand by them. Those opposite continue to try to ignore the commentary of their own leader from as recently as 1 October, when he said:

Now, everyone’s been expecting slower economic growth anyway this year, following on the events in the United States, the sub-prime crisis from last year, but as recently as March people felt—March, April—people felt the worst had passed. But it has got a lot worse and the events of the last few weeks would not have been predicted a few months ago.

Those opposite want to try and play a game where they say, ‘You don’t do anything; just sit there and do nothing,’ because what they are about is short-term political opportunism— (Time expired)