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Wednesday, 13 February 2002
Page: 109


Mr CADMAN (2:25 PM) —My question is addressed to the Treasurer. Would the Treasurer update the House on recent measures of business and consumer sentiment? How does Australia's economic performance compare with that of other economies?


Mr COSTELLO (Treasurer) —I thank the honourable member for Mitchell for his question. I can inform him that today's Westpac-Melbourne Institute index showed that consumer sentiment rose for the fourth consecutive month and is now about 13 per cent above its long-term average and is certainly above its pre September 11 levels. It is great news to see that consumers have recovered confidence, which fell in the wake of the terrorist attacks on the World Trade Centre. Yesterday's National Australia Bank business survey showed that business confidence was rising. It, too, had recovered and was now higher than at any time since the September 11 terrorist attacks.

Rising consumer confidence and rising business confidence are good in a very uncertain world. We know that the United States economy was in recession at the end of last year. Japan is in its third recession in a decade. Singapore is in a deep recession. Taiwan is in a deep recession. Growth in Europe is sluggish. Yet the Australian economy throughout the course of 2001 probably grew not only more than any of the other developed countries but substantially more. No other country in the developed world has a growth rate anywhere near three per cent or above, and the highest outside Australia was around two per cent. Australia grew at about double the rate of the next highest growth in the developed world, and at about five times the average rate of the G7.

I am sure all Australians will be pleased to welcome the news that the Australian economy continued to grow through the course of 2001. It was of course partly a response to many of the reforms which the government put in place over recent years. It would not have happened if we had not taken taxes off our exports—wasn't that a great reform, which was put in place on behalf of Australia's exporters. Australia's farmers got reductions in diesel costs and in the taxes on exports and were able to hold up Australia's exports while the world went into recession. Wasn't it good to have income tax cuts coming on-stream during the course of 2001, because that also kept up spending. The interest rate reductions throughout the course of 2001 were also supportive, as was the First Home Owners Scheme. I know that many in the coalition party supported the First Home Owners Scheme to help young Australian couples to get homes. It has been good for young Australians.

We notice that the Australian Labor Party is now discovering the `aspirational voter', something that was discovered by Robert Menzies nearly 50 years ago. He called them the `forgotten people', people who were not part of big business or big unions but wanted to have a home and a family and wanted to better themselves in life, as was pointed out in a maiden speech prior to question time. We welcome the interest of the parliament, on both sides now, in the `forgotten people', those people who really want to save and get a home—and the First Home Owners Scheme was very much a part of that.

The state of the international economy remains very severe. Nobody should kid themselves that we are going to go back, in international terms, to anything like the conditions that were experienced during the 1990s, but this government remains focused on keeping the Australian economy growing, to look after as best it can—by promoting further labour market reforms and economic reforms—those people who are very much the focus of government policy, those people who are very much on the minds, and retain the continuing interest, of the coalition government.