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Wednesday, 5 October 1983
Page: 1350

Mr SIMMONS —I ask the Prime Minister: Has the economy already bottomed out and started on an upturn? If so, does this indicate that the Federal Government's economic policies are starting to work?

Mr HAWKE —I am particularly pleased to receive this question from the honourable member for Calare because over the last weekend I had the great advantage, due to his kindness and the kindness of relevant organisations, of visiting his electorate. I am very pleased to say-this is not a matter for which we can claim credit-that due predominantly to an act of nature in the breaking of the drought I have never seen the electorate of Calare looking in better shape. We thank God predominantly for that, but obviously the smiles of satisfaction on the faces of the people of Calare also reflected to a considerable measure the great degree of satisfaction they have in their representation by their new member.

If I can extend my assessment of the economic situation beyond the electorate of Calare-and in great shape indeed it is-to Australia more generally, let me say yes, there are signs of recovery in the Australian economy and it does seem that the Australian economy has already bottomed out. There is no doubt that there will definitely be some economic recovery this year. We all know-or those of us who know anything about economics know-that economic forecasting is a somewhat hazardous matter. But during 1983-84 there could be economic growth of the order of 5 per cent to 6 per cent. That pick-up will reflect a number of factors. It will reflect the slowdown in the rundown of stocks; it will reflect the end of the drought; it will reflect the significant recovery of the economy of the United States of America; and, to a significant extent, it will reflect the impact of the Government's economic policies which were contained in the Budget and in other decisions.

I refer briefly to some of the other signs of recovery that are involved. I think all members of the House will agree that recent reductions in interest rates on Commonwealth bonds, due to a variety of factors, will be welcomed throughout the business community. We have the evidence of a number of surveys in respect of consumer confidence. The survey by the Melbourne Institute of Applied Economic and Social Research shows increased consumer confidence in the wake of the Budget. In regard to the business community, we have the surveys by the Australian Chamber of Commerce and the National Australia Bank and by the Confederation of Australian Industry and the Westpac Banking Corporation. They show that the business community expects a lift in activity and improved conditions over the coming months. There is no doubt that there has been a very favourable reaction by the Australian business community to the Budget brought down by the Treasurer, Mr Keating, on 23 August.

In the housing area there are already obvious signs of an increase in activity. There has been a very significant increase in housing loans and the coming into effect on 1 October this year of the Government's first home owners scheme will be a significant improvement. Of course, I have referred to the improvement in the rural sector. Having referred to those positive signs of improvement in actual activity and confidence, we must acknowledge that the signs are mixed. We would certainly like to see more signs of improvement in the employment area. There is no doubt that private investment is slow in picking up. But I hope that honourable members on the other side of the House will for a moment put aside their miserable partisanship and, like honourable members on this side of the chamber, recognise and welcome the signs of significant recovery in the Australian economy. I hope that the Opposition will share the confidence and hope of the Government that those signs of recovery will continue for the benefit of all Australians.