Mr CLARE (2:42 PM) —My question is to the Treasurer. Will the Treasurer outline the important economic reforms from the COAG meeting on the weekend?

Mr SWAN (Treasurer) —I thank the member for Blaxland for his question. The meeting on the weekend was historic. It was a very important meeting, and there was an agreement which caused a substantial fiscal stimulus to the economy. It will create something like 133,000 jobs, and it is an additional $15.1 billion over five years. That is all important, but what was most important about the agreement on the weekend was not the fact that there was no bickering, although that was welcome, but the long-term reform that was contained in the agreement that was signed and the breadth of that reform across a range of critical policy areas that go to the extent of growth and opportunity in our economy. Whether it was in education, in health, in business, in families or in housing, we had ministers who had been working for well over 12 months with their state counterparts to put in place fundamental reforms for the future which will drive productivity and underscore future prosperity in this economy.

What this agreement has done is to build the foundations of future prosperity by putting in place a central microeconomic reform. Whether it is teacher quality, is improving outcomes in disadvantaged schools, preventative health or progressing our movement towards a seamless national economy, this government made very substantial progress. Sometimes we hear those opposite claim that we have done nothing in 12 months, that we have done nothing across a range of areas. Through 12 months all of those ministers have worked hard with state counterparts to put in place the foundations for reform that those opposite could not do in 11 long years. That is the significance of the weekend and that is why it is so important.

Last year the Productivity Commission undertook a detailed study of what could be gained through cooperative federalism, and the commission found that joined-up efforts on human capital reform alone could result in increases in GDP of around nine per cent after 25 years. That is why this reform is so important. It adds to the productive capacity of the economy in the long term, but so many of the initiatives, particularly in housing and education, generate additional opportunity so that people’s talents are not wasted. So it was a historic reform from that point of view, but it was also a historic reform from the point of view of federal-state relations. The number of specific purpose payments was reduced from over 90 to five—a very significant break with the past—and, of course, the introduction of incentives to drive reform at the state level was also important, and also new measures of transparency so the impact of policy can be measured over time. All of these things were important. So this new federal structure which has been put in place will create jobs, it will drive reform and it will stimulate our economy.