Senator GIBSON —My question is to the Assistant Treasurer, Senator Kemp. The 1998-99 budget revealed the first Commonwealth underlying surplus in almost a decade. Yesterday the minister mentioned the benefits to all Australians of such a surplus, benefits such as lowest inflation outcomes since the early 1960s and lowest bank mortgage rates since 1970.

Senator Cook —Thanks to Labor.

Senator GIBSON —Will the minister outline how this budget surplus has been achieved?

Senator Cook —Low inflation.

Senator GIBSON —Are there any alternative theories on how to achieve budget surpluses?

Senator KEMP (Assistant Treasurer) —Many thanks to Senator Gibson for that important question. While the question was being asked, Senator Cook made an interjection in relation to the surplus. Senator Gibson referred to the very substantial surplus that the government has been able to achieve, and Senator Cook argued that this was due to the Labor Party. We are all aware of the famous quote by Senator Cook in November 1995, when he claimed that the budget was in surplus and would continue to be in surplus. That was wrong on every account and Senator Cook has refused to stand up and correct that highly misleading statement.

This surplus has been achieved through the hard work of this government. The Labor Party has opposed virtually all major measures to address the financial catastrophe which the Labor Party left to us when we resumed government. Senator Gibson was quite right when he said that the underlying budget surplus of $2.7 billion brings the Commonwealth back into the black for the first time in almost a decade. Senator Gibson was also correct when he said that it was due to the Howard government's good management of the economy and fiscal restraint. In relation to that, I will quote the very popular Treasurer, who in the last couple of days said:

We now have the lowest inflation since 1962, since a band named the Beatles sung Twist and Shout in Liverpool. Mortgage rates as low as 1969, since a man called Armstrong said, `One small step for man.' And unemployment—

Opposition senators interjecting—

Senator KEMP —The Labor Party loves to listen to this:

And unemployment as low as October 1990, since a man called Keating said, `This is the recession we had to have.'

They all want to forget that.

Opposition senators interjecting—

The PRESIDENT —Order! Just a moment Senator Kemp. Senator Kemp.

Senator KEMP —Madam President, as you would appreciate, it is quite appalling that I have to try to answer this important question with a barrage of comments coming from the other side.

I referred to Senator Cook earlier in my remarks and whether the Labor Party had left this government with the very big fiscal black hole of $10.3 billion. For some two years, the Labor Party—led by Mr Beazley, the former Minister for Finance—has been strongly arguing that there was no such black hole. As I have said in this chamber before, I am not one to normally praise the shadow Treasurer, Mr Gary Evans, but Gary Evans came clean on the Sunday program last week when he confessed that Labor had left this $10.3 billion black hole. Mr Beazley did not like that and there was a bit of argie-bargie between the two.

I can now reveal some important new information on this and, if time runs out, I am sure my colleague will ask me what this information is. A transcript has fallen off the back of a truck and it shows that the former Senator Gareth Evans is winning this debate on the Beazley black hole. This is the transcript of a radio interview. A leading member of the Labor Party came out strongly on the side of Mr Gary Evans, and I can now reveal—(Time expired)

Senator GIBSON —Madam President, I ask a supplementary question. Could the minister outline how the budget surplus has been achieved and what alternative theories there are around as to how you can achieve a surplus?

Senator KEMP (Assistant Treasurer) —Happily, because of that supplementary question, I now have time to reveal who the leading member of the Labor Party was who—

Senator Faulkner —Madam President, on a point of order: I think we all heard Senator Gibson's supplementary question. Do you believe that it appears the minister is trying to answer it?

The PRESIDENT —He is 10 seconds into his answer. I am listening very carefully to whether or not he is dealing with Senator Gibson's question, and I am sure he is. I call Senator Kemp.

Senator KEMP —As I was saying, there is this very big debate in the Labor Party between Mr Beazley and Mr Evans as to whether there was a black hole or not. As I said, Mr Evans in my view was correct and honest, and I have a transcript which has fallen off the back of a truck which reveals that a senior member of the Labor Party agrees with Mr Evans. This person said:

The $10 billion figure was in the budget outcome papers. That is true.

As time is running out, I can reveal that that quote was made on the radio by none other than Mrs Kernot. (Time expired)