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Thursday, 21 February 2002
Page: 727

Dr SOUTHCOTT (2:15 PM) —My question is addressed to the Treasurer. Would the Treasurer advise the House how Australia's fiscal position compares with that of other developed economies. How has this position been achieved and what are the benefits of sound budget policy?

Mr COSTELLO (Treasurer) —I thank the honourable member for Boothby for his question. I can report to the House that since this government was elected we have now paid off $56 billion of Labor Party debt. I think it is well known that in the last five years of the Labor government they accumulated $80 billion worth of deficits. This government came into office and turned the budget out of deficit—a deficit which the Labor Party said did not exist. Talk about misleading the public before an election! The Labor Party was running around before the 1996 election saying that the budget was in surplus and it was $10,000 million in deficit. Talk about misleading the public before an election— you went to the 1993 election with tax cuts which were l-a-w, got elected and took them away. Since this government has come into office it has repaid $56 billion of Labor Party debt. In fact, I can report to the House that it is expected by the OECD that Australia's net debt position will be around 5.6 per cent of GDP, falling to 4.5 per cent—taking into account states and territories—in 2002. Let me give some comparisons: the debt to GDP ratio of the United States—bear in mind Australia's 4.5 per cent in 2002—is 41.4 per cent. In Europe, the debt to GDP ratio is expected to be 47.7 per cent. In Japan, the debt to GDP ratio is expected to be 66.8 per cent. Australia is about a tenth of many of the comparable economies of the world.

Let me show the benefit that this has for taxpayers. When the Labor Party were in office we had to raise $8.4 billion in taxes to service their debts. That was just to pay the servicing costs of Labor Party mismanagement. After repaying $56 billion of Labor Party debt, we are now saving $4 billion a year in interest payments, which means that is $4 billion a year more for schools, for beds—

Opposition members interjecting—

Mr COSTELLO —No, for all schools actually. Government schools did not have the opportunity of getting that money because you were paying for past debts—that is Labor Party debt-driven policy.

Mr Bevis —If you want to do a history lesson, go back to school.

Mr COSTELLO —I'll do a history lesson because you need it, old son. You are never going to learn anything from this Leader of the Opposition.

The SPEAKER —The Treasurer will address his remarks through the chair.

Mr COSTELLO —He was a big part of the problem. We can remember all last term—he stood here and he had his little bags of plastic—remember? Remember his Hockey Bear pyjamas? The GST was going to cause Australia to go into recession. The GST was going to cause earthquakes, starvation and all sorts of plagues were going to be visited on the community. He did not do one thing by the time the election came. He never produced a policy—we never had a policy.

He will run around and he will try and inveigle the reputations of good, decent, honest people in this place. But I make this prediction: he will never produce a policy. I say to all of the people of the Labor Party: two weeks of distraction has kept the pressure off him announcing a policy, but it will come to an end. When it comes to an end, he will be as naked as he was at the last election. I am not a pretty sight, but as naked as he was at the last election, three years of plastic salads and Hockey Bear pyjamas, where did it all end for the Labor Party? No policy on roll-back; no policy on economics; no policy to take Australia forward. We are watching it again. It will end in the same way. Have your fun now because it will come to a conclusion.