Mr SOMLYAY (2:08 PM) —My question is to the Treasurer. Will the Treasurer inform the House of the latest assessment of the Australian economy contained in the OECD Economic Outlook?

Mr COSTELLO (Treasurer) —I thank the honourable member for Fairfax for his question. I can inform the House that the OECD released its Economic Outlook overnight, in which it provided assessments of developed economies around the world and of the global economic situation. The OECD report about Australia was extremely positive. The OECD expects economic growth to strengthen, with low unemployment and inflation contained within our two per cent to three per cent target band. The OECD notes that high company profitability, low corporate debt and buoyant business confidence are expected to support further improvement in business investment. The OECD expects that strengthening exports will narrow the current account deficit and the OECD believes that the unemployment rate, which is now at 28-year lows, will continue well below the average unemployment rate of the developed world, which is 6.7 per cent. The OECD also notes that Australia projects a surplus in its Commonwealth budget over the next two years, in contrast to the rest of the developed world, which is projecting deficits of the order of three per cent over those two years.

This assessment is particularly striking when it is compared to that of other countries in the OECD. In fact, a chief economist of the OECD, Vincent Koen, was interviewed on ABC Radio National today. He was asked by the interviewer to name some areas where Australia should be improving, and he said this:

If you heard that interview this morning you would have heard that he sounded ill at ease too, giving advice on the Australian economy.

But, having said that, economic performances can always be improved and the OECD has recommended that Australia focus on the following: ‘making wage bargaining more flexible’—this side of the House would agree with that; ‘creating stronger incentives to labour market participation’—that is what our welfare-to-work reforms are all about; ‘removing disincentives to hiring’—these are the unfair dismissal laws which the Australian Labor Party has now blocked 42 times in the Australian Senate; ‘improving training and education’—what this government is all about; and ‘promoting competitive pressures in the economy’.

It is true that Australia’s economic performance has outperformed the developed world over recent years, but that does not mean we can stop. What we have to do is improve our performance in all of those areas. The most important thing that the Australian Labor Party can do to help Australia’s economic performance is to get out of the way and let the government get on with promoting a competitive economy and reforming the labour market, unfair dismissal laws, welfare-to-work laws, education and training. The biggest obstacle to economic reform in Australia is the Australian Labor Party and its leader. I call on the Australian Labor Party to support this government’s changes to industrial relations—momentous changes which will be released later this week.