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Housing- no sign of economic recovery



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Senator Jim Short

The November 1991 data for housing finance give no indication of recovery in the economy. They further highlight the differences between the Prime Minister and the Treasurer as to the state of the economy.

Firm conclusions cannot be drawn from the data - especially month on month - because of their volatility. Being subject to quite large revisions at times, a more accurate picture is revealed by the trends rather than the spot figures.

Despite the 7.4 per cent increase in the number of dwelling units financed in November, trend estimates by ABS show a downward trend over the last three months.

The figures also reveal again just how wrong Keating was in his forecasting when he was Treasurer. In May 1991, he said:

'We're seeing a recovery coming through nowin housing approvals, we’re seeing a turnaround in the stock cycle, you'll see the national accounts for the December quarter back to positive growth. So I think you can see a recovery coming through.'

Keating as Prime Minister has changed his tune. He now says that there is no sign of life in the economy.

In stark contrast, Treasurer Dawkins is forecasting there will be substantial growth in the economy over the next six months.

If Mr Dawkins is correct, then why is the Government about to exacerbate our economic problems by an ill-conceived pump-priming exercise that will force up interest rates and frustrate private sector development?

Confusion within the Government is rife. The Prime Minister obviously has no idea whatsoever of the policy direction he wants the Government to pursue. He also has no idea of the necessary solutions to Australia's fundamental economic problems, as has been shown clearly by his public

relations road-show caravan over the past two weeks.

The continuing confusion and uncertainty will simply compound our deep-rooted economic malaise that is causing enormous hardship to millions of Australians.

ACTING SHADOW TREASURER

SMF 16/92

HOUSING - NO SIGN OF ECONOMIC RECOVERY

Melbourne 23 January 1992

COMMONWEALTH P A R L IA M E N T A R Y LIBRARY | M iC A H

For further information contact Senator Short on 03-387 4177