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Thursday, 26 March 1998
Page: 1723


Ms GAMBARO —My question is addressed to the Prime Minister. Can the Prime Minister provide the House with details on the new ABS publication of a wage cost index? Prime Minister, can you inform the House as to what this latest data tells us about how the Australian economy is travelling?


Mr HOWARD (Prime Minister) —In reply to the honourable member for Petrie, I can inform the House that today the Australian Bureau of Statistics released a new indicator of wages growth called the `wage cost index'. This index, which is compiled using a fixed basket of jobs to provide a better guide to underlying wage cost pressures, suggests that wage costs rose by the very moderate annualised rate of 3¼ per cent in the December quarter. That increase is very much within the Reserve Bank of Australia's comfort band for wages and does nothing to threaten Australia's outstanding inflation performance. In fact, Australia now has a headline inflation rate which is the best in the OECD.

Most importantly, it is average Australians who are getting the most benefit of this low inflation rate. If you have a headline inflation rate running at minus 0.2 per cent, and Australian workers are being looked after to the extent that their wages are rising by 3¼ per cent—in other words, they are getting a real wage increase of at least 3¼ per cent on an average basis—then that increase is not in any way being eaten up by increases in inflation. I would imagine that Australians who follow these matters would regard a government that has delivered that kind of economic outcome as a government that well and truly has the interests of average Australians at heart. If you can deliver zero inflation, if you can deliver an economic climate where you have zero inflation and wage increases, on average, of 3¼ per cent, you are adding to the real incomes of average Australians. But that is only half the story.

The other part of the story is that the policies of the government have resulted in reductions in mortgage interest rates for average Australians of about $300 a month. That is the equivalent of a wage rise of $100 a week for average wage and salary earners. But the good news on the economic front—and I say this to the member for Petrie—does not end with low inflation, real wage gains and interest rate reductions; it is also the case that over the last six months more than 140,000 new jobs have been created.

That figure would have been 190,000 but for the actions of the Labor Party and others in the Senate in blocking our unfair dismissal laws. What the Labor Party is doing, bound hand and foot to the trade union movement—doing the bidding of Jennie George, nodding to Jennie George and saying, `Yes, Jennie, no Jennie; I'll do whatever you say, Jennie'—is destroying jobs. I can say to the Leader of the Opposition: you will be hearing a lot more about the impact on jobs in Australia of what you have done by blocking the unfair dismissal law.

You have a picture that there is only one side of politics in Australia over the last two years that has bothered to address itself to issues that affect average Australians—and that is the Liberal and National parties. We have delivered to this country the strongest economic fundamentals for a quarter of a century. We have protected this country against the economic downturn in Asia. We have lowered interest rates. We have boosted real wages. We seen 140,000 new jobs created in the last six months. We have committed ourselves to fundamental industrial relations reform. We are seeing historic reforms—absolutely historic and courageous reforms—on the Australian waterfront.

All you get from the Leader of the Opposition is a promise of another meeting. He loves promising meetings. His great mentor, Bob Hawke, had a meeting on the waterfront—and $425 million later we were no further ahead. They had a meeting on native title that was presided over by Paul Keating and we were delivered the native title mess which is now the responsibility of my government to cure.

The housing sector also continues to power along. Total dwelling commencements rose by 10 per cent in the December quarter to be almost 20 per cent higher than a year earlier, and there is more to come. If the housing figures are anything to go by, they are almost 25 per cent higher than they were a year earlier. I repeat: the housing commencement figures are 25 per cent higher than they were a year earlier. That I know is particularly good news in those areas of Australia that are experiencing a lot of housing growth, such as the electorate represented by the member for Hughes, whose constituents are with us today, and the electorates of many other members. We have strong economic fundamentals. I know the Labor Party hates it. I know the Labor Party does not want to be reminded of it, but we have got news for them. They will be hearing a lot more about it over the next six, nine, 12 or even 18 months.

Mr Speaker, I ask that further questions be placed on the Notice Paper.