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

My question is to the Assistant Treasurer, Senator Sherry. Can the Assistant Treasurer inform the Senate of the latest official figures on the world-leading performance of the Australian economy in the face of the world’s worst global financial and economic crisis in 75 years? What do the national accounts tell us about the vital part played by the Rudd government’s decisive and timely stimulus strategy in Australia’s world-leading recovery? How is it supporting private sector led growth?

Nick Sherry (Tasmania, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

I thank Senator Feeney very much for the question. Just over a year ago we were debating in this chamber the Rudd Labor government’s $42 billion Nation Building Economic Stimulus Plan, which was passed by the parliament against the strident opposition of the Liberal and National parties and, I have to say, with the support of the Greens, Family First and Senator Xenophon.

What did we see last week? We saw further evidence of just how effective the stimulus plan was in terms of the Australian economy. The national accounts for the December quarter of 2009, which were released last week, showed that the Australian economy grew by 0.9 per cent in the quarter and continued to outperform almost every other advanced economy. In fact, Australia last year had four quarters of economic growth and through the last calendar year it had 2.7 per cent economic growth. That is in contrast to almost every other advanced economy, which went backwards during the last calendar year.

Before the stimulus package, when reductions in interest rates and a range of other decisive actions were taken, it was predicted that the Australian economy would shrink—that it would go backwards by 0.7 per cent—but, rather than going backwards like most other advanced economies in the world, the Australian economy grew by 2.7 per cent. Thousands of businesses were saved and hundreds of thousands of jobs were saved as a consequence of the range of actions taken by the Reserve Bank and by the Rudd Labor government.

Unfortunately, that stimulus package was vehemently opposed by those opposite. Their argument was: ‘Let’s wait and see. Let’s do nothing.’ We know what happened to those countries that did nothing and waited and saw. (Time expired)

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

I thank the minister for his answer. Mr President, I ask a supplementary question. What is the Rudd government’s position on limiting taxation on all sectors of our economy as Australia’s world-leading recovery from the global recession continues? How does this commitment on taxation differ from the irresponsible, ad hoc and on-the-run policy confusion of the coalition?

Nick Sherry (Tasmania, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

Central to economic policy is the role of taxation, and the Labor government has pledged that taxation as a share of gross domestic product will be kept below the level it inherited: on average, 23.6 per cent of GDP in 2007-08. The next budget will be tough—we make no apologies for that. We will be imposing spending restraints that keep real spending to a cap of two per cent.

If we reflect on the Leader of the Opposition, Mr Abbott, I think that in his first day on the job he said that the Liberal Party is a party that lowers taxes in Australia. On a number of occasions, he said that there would be no new taxes and that he would be lowering existing taxes. What did we have announced yesterday? We had a big new tax. We have been hearing a lot about big new taxes, but the Leader of the Opposition, Mr Abbott, announced a big $2.7 billion new tax.

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

Mr President, I ask a further supplementary question. In contrast to the Rudd government’s vital stimulus strategy to support private investment, is the Assistant Treasurer aware of potential dangers to privately led economic growth? How important is it to have a responsible, realistic and sustainable taxation policy such as the one the Rudd government has in place?

Nick Sherry (Tasmania, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

As is well known, Mr Abbott has made a number of public statements about lowering taxes and no new taxes. I leave it to senators and those listening to draw their own conclusions about a leader who proclaims that he will lower taxes, abolish taxes, bring in no new taxes and not increase taxes and then announces a big new tax of $2.7 billion. I would suggest that it is somewhat hypocritical to suggest that you are not going to increase taxes and that there will be no new taxes and then to announce a new one three months into your job as Leader of the Opposition. But what is worse is that at a time of economic recovery, when Australian businesses are doing comparatively very well, in comes the new Leader of the Opposition with a new tax—a $2.7 billion new tax.

John Hogg (President) Share this | Link to this | Hansard source

Senator Sherry, resume your seat for one moment. Shouting across the chamber is disorderly. I need to hear Senator Sherry.

Nick Sherry (Tasmania, Australian Labor Party, Assistant Treasurer) Share this | Link to this | Hansard source

Sorry, I had better get the line right: $2.7 billion is ‘a big new tax’. (Time expired)

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Mr President, I rise on a point of order: with an eye on standing order 73, I ask you to look at that last question and report back to the Senate on its validity.

John Hogg (President) Share this | Link to this | Hansard source

I have no doubt that the question was in order, Senator Brown.

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I ask you to review that.

John Hogg (President) Share this | Link to this | Hansard source

I will review it, and if I find I need to report back to the Senate, I will. But at this stage I would have to say that it was in order.