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Thursday, 30 May 1996
Page: 1446

Senator COOK(3.13 p.m.) —I, too, wish to take note of the answers given by Senator Short to the two questions from Senator MacGibbon and Senator Sherry. Since I have been invited to comment by Senator Campbell, can I say that his contribution today, with the greatest respect, is a good example of, when you have got nothing to say, obfuscate. I will be happy to go to the figures any time, Senator Campbell, but I don't want to be deflected from my remarks now, if you do not mind.

Yesterday the cover that this government had carefully constructed for itself to justify a Thatcherite assault on services and expenditure by the government to important sectors in Australia was blown and blown irreversibly. It was blown by the statistician, the Australian Bureau of Statistics, when it brought down the national accounts for this nation for the March quarter. We heard from the government that the forecast was that there would be an $8 billion deficit for the budget and, therefore, the most savage cost-cutting spree that any government had ever undertaken in Australia had to be embarked on in order to balance the books. Interestingly, this is from a coalition that has never in its history balanced the books.

But, in rediscovering their Thatcherite roots nonetheless and in their ideological obsession, they said, `This was necessary.' They obtained a degree of credibility in Australia because the source of their forecast—it was never hard economic statistics; it was a forecast, and all forecasts are susceptible to change—was the Australian Treasury.

The only way in which you can assess how the economy is going, broadly, is by going to the national accounts every quarter. The national accounts for the March quarter were the national accounts for the last quarter of the Labor government. Therefore they were the accounts that we, while in government, delivered to this country. They show a growth rate of 4.8 per cent for the Australian economy. That is a very high growth rate. It will ensure that the economy finds work for every school leaver and sops up the level of unemployment. Yesterday Senator Short acknowledged that this was a very good figure. It blows the cover story that there is an $8 billion black hole.

I notice that it was referred to on the AAP wire yesterday as the mythical black hole. Also, I notice that in the Canberra Times today there was the headline `Illusory black hole'. Even the economic commentators and reporters have pricked the balloon of the government's contempt for Australia in its trying to pull a swiftie and pretending that the economy of Australia is in dire straits. It is not. It is growing faster than most of the economies in the Western world and it is healthier and more robust than most of the economies in the Western world. If you were to embark on the cost cutting spree that this government now has set its sights on doing, you would withdraw public sector investment from the economy and bring on a minor recession in Australia which would put more people on the unemployment list.

But what did we get from the government today; any acknowledgment of that? Of course not. We got a story—more of the same; the bad medicine, the harsh medicine, must continue. This flies in the face of what respected forecasting agencies and economic commentators are saying. Let me quote professors John Nevile and Fred Gruen and Mr Fred Argy. In the Australian Financial Review of 20 May, they said:

. . . the figure of $8 billion is itself not a firm figure.

That is what we have been saying. They go on:

It is a Treasury forecast assuming no policy changes and a rate of growth of the economy of 3.25 per cent . . . a small difference in the assumed rate of economic growth can make a large difference in the size of the projected deficit.

The assumption was 3.25 per cent. What did we get? We got 4.8 per cent—a big difference. Therefore, even in your wildest of fantasies that $8 billion black hole does not exist. Education cuts ought not continue. Welfare cuts should not go ahead. Higher education should not be put back. People in the environment should not be disadvantaged by having their programs cut. Business programs that stimulate investment and create jobs in this country should not be cut back. All of those sectors and everyone else affected by your cuts should stand up to this government now and say, `Don't proceed. What you're propounding is a lie. The deficit is not there. There is no need for this type of approach.'