Senator KROGER (2:29 PM) —My question is to the Minister representing the Treasurer, Senator Conroy. Will the minister confirm that, in addition to raiding the surplus, the government is set to spend in one hit more than $26 billion worth of accumulated savings diligently set aside by the former coalition government for the nation’s long-term health, education and infrastructure needs?

Senator CONROY (Minister for Broadband, Communications and the Digital Economy) —I thank Senator Kroger for her question. In answer to the last question, I mentioned some views put forward by private sector economists that I think are very relevant to the question now being asked. I quoted the Westpac chief economist, Bill Evans, when he said:

ANZ chief economist Saul Eslake has said:

Those opposite and their leader completely fail to grasp the severity of the global financial crisis. Their leader thinks that the global financial crisis is overhyped. It is no wonder that their response to the global financial crisis and global recession is to sit on their hands and do absolutely nothing. You keep hearing the other side baying, ‘Just wait and see.’ If they had their way, we would not have had an economic security strategy. If they had their way, we would not have a guarantee of bank deposits and Australia would not have a government that is prepared, whatever it takes, to protect the jobs of Australians. (Time expired)

Senator KROGER —Mr President, I ask a supplementary question. Is it a fact that, having already raided the current budget surplus, emptied the nation’s long-term future investment funds and gone into deficit after just 12 months, the Rudd government is now saddling future generations with more Labor debt?

Senator CONROY (Minister for Broadband, Communications and the Digital Economy) —In the May budget the government was acutely aware of the risks posed by the global financial crisis. This included an awareness that the situation could get worse. That is why we delivered a balanced budget that combined support for families with a strong surplus to act as a buffer should global conditions deteriorate. Unfortunately, the deterioration in the global economy has now occurred. The world changed dramatically with the collapse of Lehman Brothers in mid-September. Borrowing costs soared, credit markets froze and stock markets around the world suffered significant losses. This has shifted the balance of risks right around the world. (Time expired)

Senator KROGER —Mr President, I ask a further supplementary question. Isn’t this just the same old Labor—always going into debt and deficit? Is this the deficit we had to have?

Honourable senators interjecting—

The PRESIDENT —Order! Senator Conroy, I will not call you. Order! Senator Conroy.

Senator CONROY (Minister for Broadband, Communications and the Digital Economy) —The Reserve Bank of Australia, in its November Statement on monetary policy, stated:

The Reserve Bank has responded swiftly to the deterioration in global conditions, reducing the cash rate by 200 basis points in the last three meetings. The government has also taken early and decisive action to strengthen growth and to support households—unlike those opposite, who continue to just say: ‘No. Wait and see.’ Well, the Rudd government has taken early and decisive action, because that is what the Australian public want. (Time expired)