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Wednesday, 24 March 2004
Page: 21809

Senator McGAURAN (2:04 PM) —My question is to the Minister for Revenue and Assistant Treasurer. Will the minister inform the Senate of the government's strong economic record and commitment to balancing the budget? Is the minister aware of any alternative policies that would jeopardise this record?

Senator COONAN (Minister for Revenue and Assistant Treasurer) —I thank Senator McGauran for asking about this government's economic achievements. Since the coalition government took office in March 1996, economic growth has been very strong. A recent article that appeared in the Economist said:

Thanks to wide-ranging structural reforms and sounder monetary and fiscal policies, the economy—


has recently been one of the best performers in the world.

The chief economist of the OECD has said recently:

... experts in other economies are looking to Australia as a role model.

Australia's economy has withstood a downturn like that experienced by many of the world's major economies such as the United States, France and Japan, which are in recession. This good economic record is a result of the government's strong economic policies, which include balancing the budget, reforming the tax system, reducing Labor's debt by around $60 billion, introducing a broad based indirect tax, lowering company taxes and halving capital gains tax. The national accounts released earlier this month showed the Australian economy growing at about four per cent at the end of last year, the strongest quarterly growth in four years.

The government is also committed to important spending programs in health and education. The government is investing $2.9 billion in strengthening Australia's health system through MedicarePlus. It will also provide $31.3 billion over four years for our children's education—for schools, for literacy and numeracy programs and for capital works. Good economic management does not, unfortunately, happen by accident. It comes from strong, disciplined economic policy, which is the record of this government over the past eight years.

I was asked about alternative policies and the impact they might have on this record. In Labor's magic pudding there is a growing list of unachievable and unfunded promises, amounting to over $8 billion, such as Mr Latham's announcement last week to reduce the superannuation contributions tax to 13 per cent, costing over $1 billion, and then abolish the tax in around 20 years, estimated to cost around $5 billion—and with no explanation about where that money is to come from.

Senator Sherry interjecting—

Senator COONAN —Senator Sherry reminds me of the `sloppy errors'. There was Mr Latham's $8 billion `super blooper', where it was obvious to everyone except Labor that he was pledging to increase the pension by at least $2 billion a year. With Labor steering the economy, we would be setting a course for higher taxes and greater deficits. It is obvious that Mr Latham and Labor are economic amateurs. Everyone knows that you cannot spend more, reduce taxes and keep the budget balanced.

The PRESIDENT —Order! Senator Sherry, you know—and I remind other senators also—that chatting across the chamber while the minister is on her feet trying to an answer a question is disorderly.

Senator COONAN —I was saying that we only have to look at the eight Labor state and territory governments for proof of the fact that you cannot do all things; that you cannot spend more, reduce taxes and keep the budget balanced. Last year, despite sharing around $31 billion in GST revenue, and windfalls from stamp duty of around $8.5 billion, every Labor state and territory government increased taxes. The Australian people should be alarmed at the possibility of eight Labor states and federal Labor ripping more tax out of hardworking Australian taxpayers. When it comes to balancing budgets and managing the economy, Labor are not only economic amateurs; they are sloppy, fiscal vandals who will blow the budget and drive this economy back into deficit and debt. (Time expired)