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Monday, 17 August 2009
Page: 7977

Mr TURNBULL (3:10 PM) —My question is to the Prime Minister. I refer the Prime Minister to his statement prior to the last election:

… working families have been under financial pressure, whether it’s through mortgage interest rates going up, whether it’s through the impact on rents, whether it’s food and grocery prices, the cost of child care …

As the Reserve Bank governor has indicated that mortgage rates are likely to rise by at least two per cent, house prices and rents are increasing, grocery prices may rise by as much as seven per cent and childcare costs will increase by up to $1,500 per child per year, I ask the Prime Minister: where are the fresh ideas the Prime Minister promised working families to keep the costs of living under control?

Mr RUDD (Prime Minister) —I thank the honourable member for his question and I would respond in the following terms: over the last period of the Howard government, the cost of living surged, growing by three per cent. The proposition being advanced is that there has been a relative increase relative to the period they were in government. Three per cent under the Howard government in its last year in contrast over the last year here, where inflation has eased with prices increasing by 1.5 per cent. Under this government, clothing and footwear inflation is down, transportation fuel prices are lower, recreation inflation is lower, financial insurance service prices are lower and there are a number of other categories where that applies. The premise upon which the honourable gentleman asked his question is not correct.

The second point I would make goes back to this great question of interest rates. Do those opposite remember how many interest rate rises in a row there were under the previous government? There were 10—10 interest rate rises in a row. Those opposite, through the Leader of the Opposition, come here with the great airbrushing of that fact from their collective memory, as if it never happened.

Extraordinary actions have been undertaken by the Reserve Bank to deal with the global economic crisis. These were the subject of extensive remarks by the Reserve Bank governor in his testimony before the House committee on Friday. The Reserve Bank governor’s remarks reflect the extraordinary circumstances we, and the rest of the world, found ourselves in with the global financial crisis as it unfolded last year. There were unprecedented actions by central banks across the world to bring down interest rates, unprecedented actions by governments across the world—of the classical right, the centre and the left—to inject fiscal stimulus into their economies in order to bring the global economy and national economies and employment back from the brink. These are the courses of action of responsible governments around the world—responsible governments seeking to deal with the realities with which they are confronted rather than engaging in what I can only describe as a very cheap and inexpensive debate here in terms of real policy credibility, advanced by those opposite to suggest what the honourable member has just suggested in terms of prices. Can I suggest that he, instead, familiarise himself with the facts and base his next question on a set of factual propositions rather than the fancy in which he has just engaged.