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Wednesday, 17 November 2004
Page: 78


Mr CADMAN (2:23 PM) —My question is addressed to the Treasurer. Would the Treasurer inform the House of a recent independent international assessment of the Australian economy undertaken by the International Monetary Fund? Would the Treasurer outline what is necessary to sustain the ongoing strength of the Australian economy?


Mr COSTELLO (Treasurer) —I thank the honourable member for Mitchell for his question. The IMF has recently conducted a scrutiny of all of its members—I think some 180-plus members, including Australia—and reported on their economic policy under what is called an article 4 consultation process. On concluding that consultation with Australia, on 27 October it released its assessment. Let me read to the House the assessment of the International Monetary Fund on Australia's economic performance:

Executive Directors commended the authorities for Australia's strong performance, with six years of budget surpluses, falling public debt, low inflation, high and rising productivity, and a long period of uninterrupted growth that has underpinned a dynamic job market. They attributed this performance to the authorities' exemplary record of macroeconomic and financial management and implementation of structural reforms, carried out in a transparent economic policy formulation framework.

Those are not the words of the government. Those are not the words of me or the Treasury. Those are the words of the IMF after its assessment of policy making in Australia. Having obtained a report like that which puts Australia at the forefront of the developed economies of the world it would be a mistake to sit back and to say, `There you go; there is the assessment. It is a strong assessment. We can give up the game.' The reason Australia got to where it is today is the policies that we have been pursuing of balanced budgets, reduction in debt, monetary policy agreements with the Reserve Bank, tax reform, productivity improvements and industrial relations changes. If we give up pursuing these challenges today we will not have the economic policy benefits of tomorrow. So it is important that we go on with economic policy.

The biggest challenge that we have got to confront in this country over the next 10, 20, 30 and 40 years is the ageing of the population. We have to make sure we get our pharmaceutical benefits scheme onto a sustainable basis and we have to lift productivity. There would be no one reform that would lift productivity more in this country than industrial relations reform. If we get industrial relations reform right, if we get that productivity boost in all of the factories and workplaces and shops of Australia, then we will boost our economic growth and that will go a major way to helping us deal with the ageing of the population. To the Australian Labor Party I say: give up this opposition to economic reform; get on board with the reforms which will set Australia up for the future; show that the Labor Party has changed and support this government's economic policy.