Dr NELSON (Leader of the Opposition) (2:00 PM) —My question is to the Prime Minister. I refer the Prime Minister to statements by Westpac’s chief economist, who said:

Given that the Prime Minister has inherited the lowest unemployment rate in 34 years, why has business confidence collapsed under the Prime Minister’s government? Does the Prime Minister really understand the impact of what he is doing to businesses and families across Australia?

Mr RUDD (Prime Minister) —What I know for a fact is that when the government was elected it inherited the highest inflation rate that this country has had in 16 years—fact 1. What I know for a fact is that when the government was elected this country was suffering from the second highest interest rates in the developed world—fact 2. What I know for a fact is that, as of the December quarter last year, this country was experiencing zero productivity growth—fact 3. What I also understand—

Mr Hockey interjecting—

Mr RUDD —Talking things down, Member for North Sydney, in terms of recent remarks by you on prospects for the economy? I think the member for North Sydney should reflect on that.

Mr Hockey interjecting—

The SPEAKER —Order! The honourable member for North Sydney will cease interjecting.

Mr RUDD —Fact No. 3 is that, as of the December quarter, when the government was elected, we were experiencing productivity growth which had plummeted to zero. Here’s fact No. 4: if you look at the influx of capital which came into the public revenue as a consequence of the resources boom—hundreds of billions of dollars—and look for a single substantive item whereby those opposite, when they were in government for 12 long years, invested anything of substance in the long-term productive capacity of this economy, you will be hard pressed to find anything. That is as demonstrated by the most recent report by the Business Council of Australia, which the last time I looked was not a subunit of the Australian Labor Party, particularly given their funding activities for various campaigns prior to the last election, I seem to recall.

And fact No. 5 is this. Despite record terms of trade, and despite the fact that these terms of trade have now been registered for something in the vicinity of five years, what we have seen is something like 65 consecutive monthly trade deficits, a current account deficit running at seven per cent and a foreign debt which has ballooned out by a factor of three to $530 billion—and those opposite stand at the dispatch box and say that they handed the economy to the incoming government of Australia in perfect order. You’ve got to be dreaming!