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ABC News Breakfast -

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(generated from captions) You are watching 'ABC News

Breakfast', it's shaping up to

be a big first week the

parliamentary year, a second

major fiscal package on the

cards, the RBA set to deliver

an interest rate cut. The

latest housing figures indicate

the interest rate cut is needed with house with house prices falling

across most states during the

December quarter Opposition housing spokesman Scott housing

Morrison joins us from

Canberra. Good morning. Good

morning. We learnt yesterday

that Australia is heading for

years of deficits. Is the Labor

Government to blame for

that. We are back in

that. We are back in deficit

that was inevitable. What is

also not inevitable is we'll

come out of deficit under a come out of deficit under

we are Labor Government. Importantly Labor Government.

we are back in debt. That's we are back in debt.

been since 1996 - we are back

in debt. Look, the challenge is

that the spending is effective.

Now more so than ever. Things

have to work, it's clear the

cash splash before Christmas cash splash before

did not have the intended

effect. They'll have a go effect. They'll have a

around and we are waiting to

see the details. Every see the details. Every dollar

we are spending in addition is

a dollar racked up in debt

under labour that we'll pay

back in future generations as

this debt climbs again under

the Labor Government. It

appears one of the element of

this second stimulus package is

going to be an insulation

program for houses. Is that a reasonable enough initiative. It's a reasonable enough initiative. It's over enough initiative. It's over 12

months late. The Government

promised to introduce this

scheme when they came into

Government with a $500 Government with a $500 rebate.

They are lifting it to $1,000.

We have been waiting 12 months

introduced 6789 they are for the initial measure to be

playing catch up on policy with

this, dressing it up as a

stimulus measure, this is a

policy that should have been introduced a long time Malcolm Turnbull has been introduced a long time ago,

talking about the issue of

retrofitting green buildings to

get capital investment moving,

it's consistent with it's consistent with Malcolm's

idea. Largely it's a policy

that should have been delivered

some time ago. We have hearted

some saying it should be $20

billion, the second package,

should it be that large. I

stress the issue made on debt.

Every additional dollar going

into deficit will rack up debt. They shouldn't spend

that. It puts a high test on the effectiveness and the effectiveness and quality

of that spending,it's not

enough to kick up dust

announcing large spending

measures to make the Government

look like it's doing something.

These measures have to work,

the cash splash didn't have the

intended effect. The Retailers

Association says it did. They

are only talking about a rise

on expectations, not on last

year. We saw an increase in

gaming revenues and the like. gaming revenues and the like.

It hasn't from any It hasn't from any numbers

we've seen produced stimulus

that the Government intended.

75,000 jobs. In the US they did

something similar, it was a

flat line in terms of domestic

activity while the income

measures increased. That's why

the Coalition has been talking about bringing forward tax about bringing forward tax cuts

which would go far and wide.

Hopefully the Reserve Bank will

go further this week in terms

of cutting rates, good for home

owners, and remember this time

raising rates because Kevin last year the Reserve Bank was

Rudd and Wayne Swan were saying

we had an inflation crisis, and

are egging the Reserve Bank on

to raise rates. This time last

year. We are expecting a

significant cut. Can the Labor

Government take credit for

that? Look, I think the global

conditions and various things

occurring are forcing the occurring are forcing

Reserve Bank to take these

measures, they are welcome. The measures, they are welcome.

Reserve Bank rate cuts have

been probably more been probably more effective

than any other thing happening than any other thing

over the last 12 months, more

effective than the unlimited

bank guarantee or the

Government's latest plan to

prop up banks with commercial

property places. Reserve Bank's

rate cuts are important. People

can factor them in, they have

confidence over what will confidence over what will occur

over their income, what it

means. One-off sugar hits with

the cash splash hasn't had

desired effects. We've had

breaking news that the second

stimulus package will be

announced today. The Government

is acting promptly. Well, look,

what they need to do is act

correctly, they need to get it

right. We have in part a second

stimulus, the first hasn't stimulus, the first hasn't

produced the impact they said

it would. A second stimulus

looks at the detail of. We'll

Reserve judgment and advise

accordingly. The Leader of the

Opposition Turnbull reached out

yesterday to the Government to

engage the Opposition. We are

all in this together except for

the Opposition as far as the

Government is concerned Kevin

Rudd likes to use his favourite

Ben Lee phrase, we'd like to

see him reach across the

aisles, Barack Obama has done

that in the United States and

talk to the Opposition. We talk to the Opposition.

have been putting forward

measures for the last 12 months

and basically we've been

ignored. Wayne Swan says we are

irrelevant. We are all in this

together except apparently for

half the Parliament. Scott