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Tuesday, 3 February 2009
Page: 29

Ms JULIE BISHOP (4:09 PM) —My question is to the Treasurer, and I ask him to compare the following. The 1975 budget resulted in a turnaround from a surplus of $181 million, which represented 0.3 per cent of GDP, into a deficit of $1.4 billion, or 1.8 per cent of GDP. The announcement today in the government’s updated economic and fiscal outlook will result in a $22.5 billion deficit, or 1.9 per cent of GDP, a turnaround from the 2008 budget, which forecast a surplus of $21.7 billion, or 1.8 per cent of GDP. Does the Treasurer acknowledge that this government’s financial performance will be worse than Whitlam’s?

Mr SWAN (Treasurer) —I think the shadow Treasurer has just shown yet again how out of her depth she is. We are in the middle of a global recession which has been caused by a global financial crisis, which has seen the International Monetary Fund revise down their projections of growth three times in the last four months, which has seen global growth go from the strongest that we have seen in 30 years a bit over a year ago, at five per cent—

Mr Hockey —Since Gough!

Mr SWAN —So Gough caused that too, did he? This is just the sort of—

Opposition members interjecting—

The SPEAKER —Order! The Treasurer has the call.

Mr SWAN —This is a very serious debate, and we are quite happy to have a discussion with the opposition about the best way to respond to a global recession which has now imposed on Australia very substantial deficits out across the forward estimates. That is exactly what has happened. Revenue was written down by $40 billion over the forward estimates in MYEFO, and by a further $75 billion in the statement today. That is not just a very substantial hit to the government’s bottom line but reflects the damage that has been done to this economy by these global events. It reflects the damage that has hit people who have super. It reflects the damage that has been done to people who are investors in the stock market. And for the opposition to carry on in that vein is an insult to all of those people who have been hurt by the global financial crisis and the global recession—

Mr Hockey —Oh, don’t be sanctimonious!

Opposition members interjecting—

The SPEAKER —The Treasurer will resume his seat. The member for North Sydney will withdraw.

Mr Hockey —‘Sanctimonious’, Mr Speaker?

The SPEAKER —No. The member for North Sydney knows what he is withdrawing. Does he withdraw?

Mr Hockey —I do.

Mr SWAN —The rest of the world has imposed a temporary deficit on this country, and it has been left to this government to decide the course that we will chart ahead. And we have decided, in line with recommendations from international bodies such as the International Monetary Fund, to fill the gap created by this very sharp contraction in private demand and to do that in a couple of ways, which I explained earlier. Of course, that means the deficit is a little higher as a consequence of the decision to put this package forward, which we have taken in the national interest to support jobs. What we have done is the responsible thing. What is coming from those opposite is utterly irresponsible.