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Tuesday, 26 August 2008
Page: 6219


Mr BOWEN (Minister for Competition Policy and Consumer Affairs, and Assistant Treasurer) (4:43 PM) —When we hear such sophistry from the Leader of the Opposition, it is little wonder that the confidence of the Australian people in the economic management skills of those opposite has plummeted. Is it any wonder that we have seen the confidence of the Australian people in the economic management skills of the people who up until a short time ago formed the government of this country go through the floor?

We have seen confidence in the Leader of the Opposition sink because, on his watch, he has allowed the economic credibility of his party to be cast asunder. We see a Leader of the Opposition who is determined to blow a hole in the fiscal policy of this government and undermine its efforts to bring government expenditure under control. We have just heard again the sophistry of a Leader of the Opposition who expects the Australian people to agree that it would be responsible to raid the budget surplus by $2 billion a year to deliver $2.50 a week—if all the petrol tax excise cuts were passed on.

We know the member for Wentworth thinks that is sophistry. We know he thinks it is bad policy. We know he is more responsible than the Leader of the Opposition. We know he thinks he would do a better job as the zookeeper than the current person who sits opposite. We know he thinks that he would bring more economic credibility to those opposite. The Leader of the Opposition spent the last 15 minutes desperately trying to convince the House and the Australian people that the decline in Australian consumer confidence is the result of the actions of the Rudd government. That sort of short-term, glib populism will not return his economic credibility.

Across the OECD, consumer confidence has fallen to its lowest level in 30 years. In the United States the Conference Board index, the most prominent measure of consumer confidence, has fallen more than 50 per cent since the global turbulence began and is at its lowest level in 16 years—just as it is in Australia—while an alternative measure, the University of Michigan index, has it at around its lowest level in 28 years. In the United Kingdom, consumer confidence has fallen to its lowest level in 16 years. In New Zealand, consumer confidence has fallen to its lowest level in 17 years.

We are seeing growth slowing around the world. The UK did not grow at all in the three months to June. Japan, Germany, France, Italy and Canada all recorded negative growth in their most recently reported quarters. And the Leader of the Opposition contends, with his usual earnestness, that the decline in consumer and business confidence in Australia is for reasons entirely different to those in the rest of the world. The confidence of the rest of the world has gone down for one reason, and our confidence has gone down for an entirely different reason—it is all due to the election of those horrible socialists on 24 November!

The Leader of the Opposition would have us believe that in the rest of the world confidence has fallen for a very different reason. In Australia it is not because of the financial turbulence, the oil price shock and the increase in food prices around the world. They might be the reasons in the rest of the world, but there is a different reason here in Australia. Either he thinks that or he thinks the Rudd government is responsible for the decline in confidence around the world. Maybe that is his argument. Maybe he thinks that the people of Michigan and Denver have been waking up thinking, ‘I’m not very confident about the state of the world economy because of what Kevin Rudd is doing down in Australia,’ or that the people of Dunedin and Christchurch have been waking up saying, ‘We have the lowest confidence in 17 years because of those terrible decisions that Wayne Swan is making in Australia,’ or that across Europe, Russia and Japan, where confidence has fallen, it is all down to the Rudd government. That is the sort of argument that we might expect from the Leader of the Opposition, who casts around for cheap, populist and glib lines to save his leadership as the zookeeper, to save his hide. That is what we have come to expect.

Is he really serious? He comes into the House and argues that for some reason the Rudd government is responsible for negative returns in superannuation. He does not mention that we have seen global stock market downturns of 20 per cent which have seen pension fund returns down across the world. Again, it is a similar argument: there might be a reason around the world for that but it is a different reason in Australia. Really, how can we take that sort of glib populism seriously? As I said, is it any wonder their economic credibility has gone out the window?

Of course, part of the Leader of the Opposition’s narrative—and we heard it again today—is that everything was rosy until 24 November. Do you remember what it was like before 24 November? Australian working families had never been better off! Interest rates were coming down! The Leader of the Opposition said interest rates were coming down under them, which came as a great shock to Australian mortgage holders, I must say. We had the shadow Treasurer saying interest rate increases were overdramatised, which again came as a shock to those who were paying those increased interest rates; they thought it was quite legitimate to be concerned about them. But, of course, the Westpac consumer sentiment index hit its high point in May 2007. By the time of the November election it had already declined from 124 points to 110. It has continued its decline from then—somewhat unsurprisingly, given world events.

Talking of sophistry, I noticed that the Leader of the Opposition was out and about on the weekend, and he said this:

What are the economic circumstances facing Australians at the moment with falling growth, higher unemployment and it seems higher inflation?

Welcome to the party, Brendan! He has finally worked out that we have heightened inflation in Australia. We had the Treasurer point this out some months ago, and the Leader of the Opposition and the shadow Treasurer were wandering around saying: ‘Isn’t it terrible that the Treasurer talks about inflation? If only he’d stop talking about inflation, the problem would go away.’ Ostrich economics at its worst—stick your head in the sand, do not talk about inflation and we will not have a problem.

The Leader of the Opposition and the shadow Treasurer regularly insult the Governor of the Reserve Bank of Australia. They say to the Governor of the Reserve Bank, ‘You are so stupid that you just increased interest rates because the Treasurer made a statement the day before your board meeting.’ What an insult to one of the finest public servants this nation has! It insults the intelligence of the board of the Reserve Bank, who have done a magnificent job over recent months in the financial turbulence that has been going on in the nation. The Leader of the Opposition and the shadow Treasurer insult the intelligence of the Reserve Bank and the Australian people by engaging in their ostrich economics—‘just stop talking about it and it will go away’.

It seems, the Leader of the Opposition said on the weekend, that we have higher inflation. It only seems like that to him now. We have been pointing that out for months. The light bulb comes on in Brendan’s office: we have higher inflation. Finally they have worked it out: cost-of-living pressures on the Australian people are significant. At least the Leader of the Opposition has at last come to the realisation that inflation is not a charade and not a fairytale but is real and requires government action—that we have the highest inflation in 16 years. That is why the government have brought down a contractionary budget that puts downward pressure on inflation and interest rates, as the Reserve Bank has indicated.

We had the Leader of the Opposition say, ‘This typical Labor government! They just increase spending.’ I do not think he read the budget papers, because we have seen government expenditure reduced to its lowest level since 1989-90, making up for the financial and fiscal irresponsibility of those opposite, the tax-and-spend Liberals who we replaced, the people who let government expenditure increase by 4½ per cent a year, which put upward pressure on interest rates and put upward pressure on inflation, as we heard during question time. They just do not get the message. They continue to attempt from the other place to undermine our budgetary strategy to put downward pressure on interest rates and inflation. That is why we brought down a family relief package in the budget. We recognised the cost-of-living pressures on the Australian people. That is why we increased the utilities allowance for pensioners. That is why we increased the childcare rebate from 30 per cent to 50 per cent.

We know the Leader of the Opposition cannot make up his mind on an issue. We know he has trouble making a decision and sticking to it. We know he has trouble with a narrative. We saw this in the climate change debate. I think the record was seven positions in one day. But we just had four positions in one speech in relation to the world economic slowdown. We had him firstly saying, ‘Australia should be different from the rest of the world. Australia shouldn’t be affected by the consumer confidence decline. Australia shouldn’t be affected by the decline in economic growth.’ He then pointed out the slowdown in the world economy and that confidence had fallen around the world. In one speech he could not hold a narrative. No wonder the Australian people no longer know what those opposite stand for. No wonder the Australian people are wondering what the once-great Liberal Party in this country actually believes in anymore. No wonder the Leader of the Opposition is known as ‘the zookeeper’ by the shadow Treasurer. They just do not stand for anything anymore. They certainly do not stand for responsible economic management.

It has been up to this government to get government expenditure back under control. It has been up to this government to put a package in place to give relief to Australian working families, seniors and carers who are doing it tough. You see, we sit around the cabinet table thinking of ways to give Australians a better chance in times of increased inflation. They sat around the cabinet table thinking of ways to reduce people’s conditions and salaries. They sat around the cabinet table saying, ‘The Australian people have never been better off, and we’re going to rip into their conditions.’ They sat around the cabinet table saying, ‘Let’s think of new ways that we can rip up awards. Let’s think of ways we can reduce people’s ability to go onto collective agreements. Let’s think of ways that we can make life harder for working Australians.’

We sit around the cabinet table thinking of ways to get government expenditure under control and ways to put downward pressure on interest rates and inflation. That is why the Australian people chose us on 24 November. That is the defining difference between our two parties. We actually believe the Australian people deserve more of a hand. Those opposite believe the Australian people deserve less of a hand. The members opposite think that Australian working families have never been better off and, therefore, they should be made to suffer. Those opposite believed that things were so rosy on their watch that it was time to reduce working conditions and salaries. Those members opposite believed that inflation was right where they wanted it, that it was mission accomplished, that there was no more to do so they might as well start ripping into working conditions and they might as well start reducing salaries through Work Choices. That is what they believed. It continues to be a fundamental difference between our two parties, and if they continue to believe that then the Australian people will continue to believe that their economic credibility is non-existent.

We continue to hear sophistry of the like that we have heard from the Leader of the Opposition for 15 minutes—that the world economy is slowing but that should have no impact on Australia; that confidence in Australia has hit its lowest level in 16 years all because of the actions of the Rudd government. Presumably it has hit its lowest level because we have increased the childcare rebate to 50 per cent. Or maybe it is because we have brought down a family relief package. Or maybe it is because we have ripped up Work Choices. Let us have a look at the Sensis report on consumer confidence in Work Choices. The confidence of people in actually getting a fair deal in their workplaces is what has gone up since the election.

The Australian people are not mugs, but they know a mug when they see one and they know the members opposite are mugs because they are treating them like fools. They insult the intelligence of the Governor of the Reserve Bank and the Reserve Bank board, and they insult the intelligence of the Australian people. The Australian people have woken up to those members opposite.