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Thursday, 13 April 1989
Page: 1502

Senator PETER BAUME —My question is directed to the Leader of the Government in the Senate. In order that everyone can understand and evaluate the implications of last night's financial statement, would the Minister indicate the Government's expectations for interest rates over the next 12 months?

Senator BUTTON —The answer to the second part of the question is no. If people, including Senator Baume, want some assistance in evaluating last night's statement, let me say that it produced enormous tax cuts and a very strong family package. It produced considerable concessions for pensioners. It leaves a very significant surplus such as this country has not had for 30 years, I suspect. It came about after four years of falling Government spending. Government spending has been lower than at any time during the period of the previous Government. There was never a surplus under the previous Government. The other impact, in evaluating last night's statement, is that it is designed to head off, will succeed in heading off, what otherwise might have been a very difficult wage explosion of the kind which occurred in 1982 and 1974.

Senator PETER BAUME —Mr President, I ask a supplementary question. Why will the Minister not give the people of Australia all the current information on the matter about which I asked, projected interest rates, since they affect every aspect of people's lives, in particular, their capacity to continue to own their own homes? Why will he not give this information so that apparent beneficiaries of last night's statement can know whether they will be net beneficiaries at the end of the day? Does he not consider that every Australian has a right to be in possession of all information presently available on the likely movement of interest rates?

Senator BUTTON —Senator Peter Baume is developing a Senate version of the melting ice cube theory which was put by his Leader in the other place last night. No government to my knowledge has ever, in any specific terms, speculated about interest rates. I remember that Mr Doug Anthony gave an undertaking about interest rates in the time of the Fraser-Howard Government. He said that if interest rates did not fall by 2 per cent in the particular year, he would eat his hat. He did not honour that promise, but that was par for the course for the previous Government.