Mr BROADBENT (2:01 PM) —My question is also addressed to the Treasurer. Would the Treasurer advise the House of the results of the September quarter national accounts released today by the Australian Bureau of Statistics? What do they indicate about the Australian economic outlook?

Mr COSTELLO (Treasurer) —I thank the honourable member for McMillan. I can inform him that national accounts were released today which indicate the state of the economy in the September quarter of 2005. Those national accounts showed that the economy grew by a modest 0.2 per cent for the quarter, and 2.6 per cent through the year. This comes after the strong growth we saw in the June quarter. Consumption has moderated, undoubtedly due to higher petrol prices. It appears that, with the house market turning down in value, consumers or home buyers have taken the opportunity to consolidate their balance sheets. The dwelling sector continues to experience a relatively mild downturn.

Australia is in the midst of a very strong investment boom. Total new business investment rose another 2.5 per cent in the September quarter and is now 17.6 per cent higher through the year. This is supported by terms of trade which are as high as we have seen since 1974. It is also supported by the fact that business profits are higher as a percentage of total factor income than ever previously recorded in Australian history.

Notwithstanding the rise in the terms of trade, inflation remains moderate. What that means is that the economy is now shifting from consumption to investment, we are lifting our capacity and we are now getting good strong infrastructure investment, which gives the opportunity to lift the capacity of the Australian economy and meet the boom in mineral commodities which is coming, led principally by China and to some degree India. That means we are building for the longer term. These infrastructure developments take time to be brought in but, as that capacity comes on line, I would expect Australia’s exports to increase.

For the member for McMillan and others who are interested in economic prospects in this country, this means that the Australian economy continues to grow in a sustainable way, with unemployment as low as it has been for 30 years and inflation which is moderate and under control. It is important that we keep economic reform going in this country to lift productivity. Nothing could be more important than the industrial relations changes that have just been passed because they will give Australia the opportunities of the future.