Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Tuesday, 3 May 2016
Page: 4207

Interest Rates

Mr BOWEN (McMahon) (14:35): My question is to the Prime Minister. When the Reserve Bank cut interest rates in 2013 from 2.75 per cent to 2.5 per cent, the member for Warringah said it was because the Reserve Bank had concerns about the state of the economy. Prime Minister, given that a few moments ago the Reserve Bank cut interest rates to 1.75 per cent, does the Prime Minister agree with the assessment of the member for Warringah?

Mr TURNBULL (WentworthPrime Minister) (14:35): I thank the honourable member for his question. I have in my hand the statement by the Governor of the Reserve Bank relating to the decision to lower the cash rate by 25 basis points to 1.75 per cent today. I draw honourable members' attention to the governor's remarks, which support the economic case that the government is making and support our commitment to strong growth and jobs and continuing the successful transition from a mining construction boom to a more diverse economy. The governor's remarks underline the risk posed by the opposition to that successful transition. I will quote from the Reserve Bank governor's statement:

In Australia, the available information suggests that the economy is continuing to rebalance following the mining investment boom. GDP growth picked up over 2015, particularly in the second half of the year, and the labour market improved. Indications are that growth is continuing in 2016, though probably at a more moderate pace.

So the successful transition is continuing.

Opposition members interjecting

Mr TURNBULL: We can go on as long as you like. The statement says:

Labour market indicators have been more mixed of late.

We had very good growth last month. It goes on to talk about inflation being low. I should note, too, that the Reserve Bank governor says:

In reaching today's decision, the Board took careful note of developments in the housing market, where indications are that the effects of supervisory measures are strengthening lending standards and that price pressures have tended to abate.

This is a reminder that we have seen prices coming off in many parts of our cities and, indeed, in some states. The housing market is trending downwards—a correction, you might think. But you have to ask yourself, Mr Speaker: why would Australians risk a kick in the guts to the housing market right at the point where it is vulnerable? The value of Australians' single biggest asset is threatened by a Labor government. By contrast, the budget tonight will responsibly deliver on our economic plan for jobs and growth, a sustainable tax system for the 21st century economy, commitments to health, education and infrastructure fully funded and a return of the budget to balance. That is our commitment and that will continue—the successful transition of which the Reserve Bank governor wrote only a few minutes ago.

The SPEAKER: The member for Lilley and the member for Riverina were interjecting at each other through that answer loudly. They are both warned. The member for Isaacs will not interject again, otherwise he will not be in the chamber.

Mr Nikolic: Mr Speaker, I rise on a point of order. Repeatedly during the Prime Minister's answer the member for Lilley used an unparliamentary term. I ask him to withdraw.

The SPEAKER: If the member for Lilley used an unparliamentary term, I would ask him to withdraw.

Mr Swan: No, I did not.