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Wednesday, 16 March 1977

Mr LYNCH -What the honourable gentleman has failed to understand, as have others on the front bench of the Australian Labor Party in this House, is the increase which has taken place in real disposable income. I have debated this subject with his colleague the shadow minister for the economy, or whatever he is called, in this place. I have said before in this place, and I repeat it now, that real household disposable income- surely the honourable gentleman knows exactly what that means- is seen as a barometer of living standards in the Australian community. I invite the honourable gentleman to look at the record for the year to the September quarter of 1976. He will see that real household disposable income during that period increased by 2.9 per cent.

I take the opportunity to give the lie to what the honourable member for Adelaide has said in relation to this matter. He has claimed that real disposable household income has been diminished during the period of office of this Government. The honourable gentleman has claimed that the whole of the increase occurred during the December quarter of 1975 and that real household disposable income fell during 1976. What he has done, of course, is to resort to the dubious practice of citing seasonally unadjusted figures without qualification. As honourable gentlemen would understand, household disposable income as measured in the national accounts- the honourable gentleman who has just asked for information from me does understand the make-up of those accounts- is subject to considerable seasonality and movement from one quarter to another is not indicative of an underlying trend. I have given the seasonally adjusted figures, which give the lie to what the honourable member for Adelaide has said. Finally, let me say that if the honourable gentleman who-

Dr Klugman - What about the increase in the last quarter because of Medibank payments?

Mr SPEAKER -Order! The right honourable gentleman will resume his seat. The honourable member for Prospect continues to interject and unfortunately is joined by the honourable member for Corio. I ask honourable gentlemen to listen to the answer in silence.

Mr LYNCH - The point about real household disposable income in fact matches the point about what the honourable member for Oxley has said. His figure for the rate of inflation, as he knows full well, is grossly irresponsible and not founded on fact because the rate of inflation, on the basis of any test, showed in its underlying trend a marked downward turn during 1976.

If the honourable gentleman wants to compare one year with another I finally invite him to look at his own record when he was the last Treasurer in the Labor Administration. He talked then about real gross domestic product being forecast to increase by about 5 per cent in 1975-76. The fact is that real gross domestic product increased by only 1.3 per cent during the year and would have been negative but for the rise that took place during the last half of that year under the policies of the present Government. The honourable gentleman also said in his Budget Speech that there would be a Budget deficit of around $2.8 billion. When we came into office the Budget deficit was $4.8 billion. I make a final point, but there are many others. I know that the honourable gentleman is looking a little uncomfortable because the prize apparently has not yet come his way; but, as he also raised the question of monetary policy, I remind him that we inherited rates of monetary growth which were running at 20 per cent and which were greatly permissive and inducive to inflation. If the honourable gentleman wants to compare records he might look to his own.

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