Thursday, 26 June 2008
Questions without Notice
I would have thought that as shadow Treasurer the member for Wentworth would have reached a conclusion about the intersection of 10 interest rate rises in a row with the cumulative confidence of the business community, because what those interest rate rises add up to is a huge additional cost to the operation of a business. They also affect, of course, consumers—those who buy the goods and services produced by businesses—and, as a result, that washes through in terms of the impact on the economy.
The second factor I would draw to the honourable member’s attention—and I would draw his attention to the impacts outlined in parallel business confidence surveys in many OECD countries at present—is the wash-through effect of the global financial crisis and the global oil crisis: the third great global oil shock in 30 years, the biggest global oil shock in 30 years. We had interest rate rises, 10 in a row under the previous government—having promised us that interest rates would be kept at?
I have a question for the member for North Sydney, which is: if they were going to be kept at record lows, and that undertaking was given at the end of 2004, what was it that happened in 2005, 2006 and 2007?
Maybe it was a mirage, all of those interest rate rises in a row. I would say to the member for Wentworth, as he plots and schemes over the break in his preparation to take over the Liberal leadership, that, on the basic question of what impacts on confidence: there is the impact of a succession of interest rate rises, the impact of the global economy on the basis of what is happening with global financial markets still and, on top of that, the impact we have seen of global oil prices.
Our alternative is responsible economic management, which is why we have brought about a $22 billion surplus on which a Liberal Party raid is being conducted at the moment in the Senate, on this last day that the Senate sits—a $22 billion raid on the surplus. If there is one sure-fire way to put upward pressure on inflation, upward pressure on interest rates and, as a consequence, affect confidence in the real economy, it is to pursue such a policy of continued economic irresponsibility. I would have thought the member for Wentworth would be aware of those basic facts. Perhaps his energies have been directed in another direction in recent weeks and days.