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Thursday, 14 February 2008
Page: 386


Mr SIDEBOTTOM (2:34 PM) —My question is directed to the Treasurer. Would the Treasurer please update the House on the implications of today’s employment figures for the inflation challenge?


Mr SWAN (Treasurer) —I thank the member for his question, because today’s employment figures are welcome figures.

A government member—Hear, hear!


Mr SWAN —Hear, hear—too right! We always welcome the creation of jobs on this side of the House. On this side of the House, it goes to the very core of our being. We welcome the creation of 28,600 new jobs in January, with the unemployment rate falling to 4.1 per cent. As I said yesterday, we are very optimistic about the future of the Australian economy. We recognise that unemployment is low and that we are in our 17th straight year of growth. But we also have very substantial challenges, because we are in the midst of a terms of trade boom, which has been delivering the wealth creation and the jobs of recent years. The challenge that we have as a nation is to prepare for the future, to meet the challenges that flow from that terms of trade boom, because the labour market is tight. It is the tightest it has been in a generation.

Opposition members interjecting—


Mr SWAN —It means it is very tight; it means it is low. That is what it means: very low.

Government members interjecting—


The SPEAKER —Order! The Treasurer has the call!


Mr SWAN —The problem with the opposition is that they cannot recognise the scale of the skills crisis in this country, which they neglected, which they denied—


Mr Pyne interjecting


The SPEAKER —Order! The member for Sturt will cease interjecting.


Mr SWAN —Those opposite did ignore the capacity constraints in the Australian economy precisely at the time that we needed them to put in place some far-sighted reforms. And they did not do it. They ignored 20 warnings from the Reserve Bank over three years about capacity constraints in the Australian economy. This government will not ignore those capacity constraints. At the very core of the program that we took to the Australian people are schemes to address the skills shortage and a whole series of plans to deal with infrastructure bottlenecks. This government will expand the skills base in this economy. The Minister for Employment and Workplace Relations has already announced additional training places, and we have announced what we are doing in terms of infrastructure.

But also, in this environment, what is really important is labour force participation. Enhancing labour force participation, giving incentives to Australians who work hard, is very important. So I am proud to say that today I introduced into the House the tax cuts that will provide incentive for people not only to further participate—


Mr Hockey —Our tax cuts.


Mr SWAN —No, they are not.


Mr Hockey interjecting


The SPEAKER —I warn the honourable member for North Sydney.


Mr SWAN —These tax reforms will put incentive in the system. They will enhance labour force participation and, in particular, they will encourage second-income earners into the workforce. The previous government, the opposition over there, ignored for years disincentives in the tax system. They simply ignored them. We are proud to put these forward today. In addition, we have put forward an increase in the childcare rebate.


Mr Hunt —Mr Speaker, I rise on a point of order. Put him out of his misery!


The SPEAKER —The member for Flinders will leave the chamber for one hour under standing order 94(a).

The member for Flinders then left the chamber.

Opposition members interjecting—


The SPEAKER —To the disorderly interjections that indicated that the member for Flinders was not warned, it has been the tradition of the one hour that there is not a need for a warning. When they were first put in place there was no warning, and I will be returning to that basis. If people clearly are trying me on, I will give them what they have earned.


Mr SWAN —The previous government was not prepared to front up to these challenges. This government is on the front foot from day one. Those opposite do not recognise the problem, so they cannot be part of the solution.