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Tuesday, 22 February 1977
Page: 259

Mr UREN (REID, NEW SOUTH WALES) - My question is directed to the Treasurer. Does the Treasurer agree that the level of demand today is lower than that necessary to clear all economic output at a satisfactory profit? If he cannot disapprove this, will he at least provide funds to re-employ people who have lost their jobs and to assist those poorer people who have suffered most severely From inflation?

Mr LYNCH (FLINDERS, VICTORIA) (Treasurer) - The Government rejects completely any suggestion that additional stimulus is required to the economy at the present time and rejects also any suggestion that the economy has, in fact, failed to pick up. The fact is that there was a significant improvement in economic performance, particularly in real growth, during the course of last year. The real growth non-farm product increased by over 7 per cent between the December quarter 1975 and the September quarter 1976 in comparison with the decline of 4

Eer cent that took place during the 7 quarters leading to the end of 1975. There is, of course, further evidence of additional growth in demand since the September quarter. I have mentioned to the honourable member the very marked upturn in business profitability which means that the corporate -

Mr Bryant

Mr LYNCH -The figures are there for all to see. That marked upturn means that the corporate sector is now in a better position further to increase its level of investment spending. I also remind the honourable gentleman of the statement made by his leader that Labor would achieve a 6 per cent to 7 per cent growth rate during its period in office. The fact is that the GDP increased by an annual average rate of 5.3 per cent in the 10 year period up to 1972. One can compare that with the appalling record of growth during the period that the honourable gentleman and his colleagues were in office. I can inform the House that the Budget forecast of a 4 per cent non-farm GDP will in fact be exceeded. We expect, subject to the normal qualifications in forecasting, that the figure will be closer to 5 per cent in this financial year.

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