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Tuesday, 12 May 2009
Page: 3475

Mr RAGUSE (2:15 PM) —Mr Speaker, my question is to the Prime Minister. Will the Prime Minister further update the House on the impact of the global recession on Australia and the government’s response?

Mr RUDD (Prime Minister) —I thank the honourable member for his question, because it goes to the global dimensions of what we are confronting at the moment. For those opposite who are interested in facts, as opposed to fiction or political opportunity, here is one for you: 32 out of the 33 most advanced economies in the world have been forecast by the IMF to contract this year. Secondly, eight out of 10 of Australia’s top trading partners are in recession now. This means, for this country, higher unemployment, and higher unemployment in practically every other economy around the world. Take the United States alone, where they have lost some 5½ million jobs since the beginning of 2008. That is what is happening in the world. What is this government’s strategy? It is to support jobs, small business and apprentices today by investing in the nation-building infrastructure our country needs for tomorrow. That is our strategy.

What have we done in terms of practical effect? In financial markets in Australia we have acted to provide guarantees for the deposits of each and every Australian in their banks, their building societies and their credit unions, in order to underpin confidence in our financial markets. Secondly, we have reinforced those interventions by the work we have done collaboratively through the G20 to assist in stabilising global financial markets.

This government has also invested directly in infrastructure measures. Some 70 per cent of this government’s economic stimulus in nation-building infrastructure has been invested precisely in those assets which our country needs to build productivity and economic growth in the future—supporting jobs, supporting apprentices, supporting small businesses across our country. This is nation building for recovery: investing in urban rail; investing in roads; investing in ports; investing in the largest school modernisation program our country has ever seen, to boost productivity; investing in a national broadband network; and investing in skills. We are currently investing in one of the largest expansions in the skills base that this country has ever seen, including investment in some 711,000 new apprenticeships, TAFE places and VET places. Through this we are also implementing much-needed reform because, during this difficult time of economic downturn, for every person under the age of 25 we have a very simple principle: we expect under-25s in this period to be either earning or learning. And we are providing the training places across the nation to turn that principle into reality.

Because of the global recession there has been something in excess of a $200 billion collapse in government tax revenues, which means that the government has lost the equivalent of one dollar in every five in tax revenue to the Commonwealth. Two-thirds of this government’s temporary deficit is made up from the collapse in taxes caused by the global recession—a temporary deficit supported by the $180 billion debt and deficit plan embraced by the Leader of the Opposition, the Liberals’ debt and deficit plan. Two-thirds of this government’s temporary deficit is made up from the collapse in tax revenues—one dollar in five—

Dr Jensen interjecting

The SPEAKER —Order! The member for Tangney!

Mr RUDD —brought about by the global recession. The bulk of the remaining one-third in the government’s temporary deficit is through the investment in the infrastructure we need for tomorrow. This is the question that makes those opposite always squirm when asked to answer: if they are not borrowing against the collapse in tax revenue then which portfolios of government—not ‘which programs’—would they cut? Because $200 billion, the equivalent across the forward estimates of something like $50 billion a year, is about equivalent—

Dr Jensen interjecting

The SPEAKER —Order! The member for Tangney is warned!

Mr RUDD —to what we spend at present on the entire health and hospitals budget. So, Leader of the Opposition, if you are going to stand here and pontificate and say that you are not going to borrow to offset against a collapse in tax revenue, name the portfolio, not the program, you are going to abolish. It is either the entire hospitals funding from the Commonwealth to the states, 2½ Defence budgets or more than the entire education spend and a whole lot on top.

These are the decisions that we confront in the period ahead. Those opposite always resile from positive news. Did you notice how they disappeared last week when there was, for the month that has just passed, some positive news when it came to unemployment? The Leader of the Opposition disappeared into the abyss; he was not to be seen. The member for North Sydney—

Mr Turnbull —Mr Speaker, I rise on a point of order. I was actually in Western Sydney at a Salvation Army launch—

The SPEAKER —Order! The Leader of the Opposition will resume his seat!

Mr Turnbull —Is the Prime Minister saying that the Salvation Army—

The SPEAKER —Order! The Leader of the Opposition will resume his seat! The Prime Minister has the call and he will be heard in silence.

Mr Turnbull interjecting

The SPEAKER —Order! The Leader of the Opposition is using up any goodwill.

Mr RUDD —It appears that the Leader of the Opposition—

Mrs Bronwyn Bishop —Mr Speaker, I rise on a point of order. Could the Prime Minister table that part of the speech he has been reading from—

The SPEAKER —The member for Mackellar will resume her seat. The member has been here long enough to know the proper procedures.

Mr RUDD —The opposition—the Liberals—hate it every time there is positive news on the economy because they find that it does not suit their political agenda. It might be consistent with where we want to see the national economy go and where every right-thinking person in the country wants to see our economy go, but it does not suit their political agenda. So when the unemployment data came out last week the Leader of the Opposition was nowhere to be seen, but suddenly ‘Hockey Joe’ appeared and reluctantly took the microphone.

There was positive news also in terms of retail sales, which I referred to before, and housing finance commitments are up. The ABS reported today that the number of owner-occupied housing finance commitments rose by a solid 4.9 per cent in March. That is ABS data that is out today. The number of owner-occupied loans is three per cent higher than it was a year ago. This is the first time that there has been positive through-the-year growth since January 2008. First home buyer activity continued to grow with the proportion of owner-occupied loans for first home buyers increasing to 27.3 per cent, the highest since records began. To quote Westpac, households are responding ‘to extremely low interest rates and generous incentives for first home buyers’. UBS economist Scott Haslem said:

 Overall, today’s housing lending data is unequivocally strong.

Similarly, a report again today from the business confidence survey stated that the situation remained unchanged in April.

These elements go towards underpinning one core proposition: a government committed to reducing the impact of the global recession on Australia. If you take a concerted series of measures it will have an effect. Our overall strategy is plain: we are going to continue to support jobs, apprenticeships and small businesses in this economy by investing in the nation-building infrastructure we need for the future.

Mr Pyne —Mr Speaker, I rise on a point of order. The Prime Minister has now been speaking for over seven minutes. You have spoken yourself about the need for short answers. How can you expect the opposition to maintain its decorum in the face of this extraordinary performance on the part of the Prime Minister on budget day? It is time to get on with the next question.

The SPEAKER —The member will resume his seat.

An opposition member—It is just naturally occurring wind.

The SPEAKER —There is an expectation, no matter what provocation might be perceived, that people behave properly. I do not think the Manager of Opposition Business is actually helped by interventions after his point of order. There are no points of order about length of questions. I am on the public record with comments about that, but I do not wish to pursue them today. The Prime Minister has the call and he should be heard in silence.

Mr RUDD —Our strategy is clear, and that is to support jobs, apprenticeships and small businesses today by investing in the nation-building infrastructure our country needs for tomorrow. That is what we are doing and, in every state of our great nation that I have visited in the last six or seven weeks, during which we have not been in this place, the response on the ground has been from communities saying: ‘We are glad to see school construction being commenced here. We are glad to see this local government project commencing there. We are even glad to see a sports project commencing in the electorate of Wentworth.’ The local member, it seems, having voted against funding for infrastructure projects, then has the gall to show up and say ‘me too’ in support of that particular project.

Wherever you go across the country people are saying: ‘At least we have a government in there having a go, supporting local projects, making a difference on the ground, supporting skills in their communities and supporting the construction of new homes, as opposed to an opposition that pretends it has an alternative strategy when in fact its alternative strategy is politics, politics and politics.’