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The Treasurer, Mr. Phillip Lynch, in commenting on the release

Mr. Lynch said that gross non-farm product had increased in real terms by 5.2 per cent over the year to the December quarter, more than recovering the 4 per cent decline that took place

under the last 21 months of the former Government's administration.

There were some particularly encouraging aspects of the National Accounts figures. ,

For example, investment in plant and equipment by private enterprises had increased by 31·2 per cent in 1976, equal to a growth of 18.4 per cent in real terms, a clear reflection of the success of the Government's investment incentives.

Mr. Lynch also pointed to the fact that company profits were some

33 per cent higher in the December quarter of 1976 than they were

a year earlier, confirming the series of healthy company results that had recently been reported by company chairmen.

He stressed that the recorded fall in real gross non-farm product in the December quarter mainly reflected the turnaround in exports from the quite exceptional levels of the September quarter:

today of the preliminary December Quarter National Accounts,

said that the Accounts indicated that the economy was moving in line with the Government's overall economic strategy.


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looking ahead, export levels could be expected to benefit from

the effects of the recent devaluation.

The Treasurer noted that the Statistician had advised that the

. product estimates might overstate the fall in the December quarter and overstate the rise in the September quarter.

In half-yearly terms, gross non-farm product was estimated to have risen by 3 per cent in the half-year· to December 1976, compared with 2.9 per cent in the previous half-year.

Taken together, the aggregates for the December quarter underlined the likelihood that real growth in the non-farm sector of the economy would exceed the 4 per cent rate foreshadowed at the time of the Budget.

The Treasurer noted particularly the strength in the expenditure aggregates.

Private consumption recorded a rise of 1.5 per cent in the December quarter following no movement in the September quarter.

The increase in the half-year to December 1976 was 2.0 per cent compared to 0.9 per cent in the previous half-year.

Private investment had risenby 5.4 per cent following a fall of 3.8 per cent in the September quarter.

Stock building had remained at a healthy level.

The strength in public expenditure reflected in part the timing of defence expenditures. ,

Despite the recorded moderate rise in wages, salaries and supplements of 0.6 per cent in the December quarter, it was imperative that wage increases showed sustained moderation,

so that confidence could be enhanced, investment show continued

strength and the capacity of the economy to sustain high employment levels be fully restored.

18 l^rch, 1977