Yvette D'Ath (Petrie, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. What is the government doing at home to respond to the impacts of the slowing global economy?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

These are very serious issues for the country which were not taken seriously by those opposite when they were in power. They were not taken seriously at all—12 years of neglect. We are dealing with these issues, and we will not be deflected by their economic vandalism in the Senate as we deal with them, because this country is dealing with the most complex set of global economic factors in over 25 years—

Bob Baldwin (Paterson, Liberal Party, Shadow Minister Assisting the Shadow Minister for Defence) Share this | Link to this | Hansard source

You can’t handle them!

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! The member for Paterson!

Bob Baldwin (Paterson, Liberal Party, Shadow Minister Assisting the Shadow Minister for Defence) Share this | Link to this | Hansard source

You can’t handle them!

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

The member for Paterson is warned!

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

The largest developed economies are struggling to grow. The UK, Japan, Germany, France and Italy all recorded zero or negative growth in the three months to June. And this problem combined with the impact of 10 interest rate rises in a row, left to the country by those opposite, is slowing our economy. But there are grounds for optimism in all of this because we have a substantial budget surplus and, of course, as we have seen today from the latest figures from the bureau, commodity prices are also at a record high, and that is a good thing. And, as we saw from the capex figures the other day, business is continuing to invest. As the Prime Minister said earlier, we also have $40 billion put away in our investment funds to invest in the productive capacity of the future, to lift the productive capacity of the economy, and to deal with the inflationary challenges that this country faces. So what we will do is to control those things that are under the control of domestic governments. What that means is a disciplined fiscal policy. It also means investing in the productive capacity of the economy. Of course, that is more difficult when those opposite want to use the Senate to punch a hole in the budget surplus. But, as the Prime Minister said earlier, we on this side of the House are absolutely determined to invest in nation-building projects, to lift the productive capacity of the economy and our international competitiveness, because what we are battling here is 12 years of neglect from those opposite. But we have put up our hand to accept responsibility for fixing it, and we are putting in place a long-term strategy for the future. We will not make the same mistake that those opposite made. They celebrated prosperity but did nothing to achieve it into the future.

Brendan Nelson (Bradfield, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Prime Minister. Prime Minister, why have real wages dropped by one per cent since the election of the Rudd government?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

If you look at the data contained in the budget papers, we projected that there would be a softening in employment in 2008-09, and therefore an increase in unemployment from 4.75 per cent. Furthermore, parallel to that, we also projected in the budget papers that there would be softening economic growth. As a consequence of that, we are dealing with softer and more challenging economic times. We have been upfront about that. We have not sought to be evasive about it; that is just the truth. Therefore, that has an effect on all working families. Because of the cost pressures I have run through before at the dispatch box, it also has an effect on, in particular, pensioners and carers, who are trying to make ends meet.

What I also say to those opposite on the question of the employment conditions of working Australians is that the biggest impact over time on the take-home pay of working families is the industrial relations system under which people work. Therefore, noting that we have got softening global economic circumstances, and noting also that we have upwards revisions of unemployment—these are facts—I would ask those opposite: would workers who are, for example, in some of the businesses referred to by those opposite last week, where there have been closures and where people have lost their jobs, prefer an industrial relations system where redundancy payments were guaranteed or one where redundancy payments were signed away? I say that there is a fundamental difference between those opposite and those who stand as members of the government—the fundamental difference about which we fought the last election—which is that we believe, whatever circumstances a business finds itself in, people should have a right to proper redundancy payments.

Joe Hockey (North Sydney, Liberal Party, Manager of Opposition Business in the House) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order. The question was, ‘Why have real wages fallen by one per cent since the election of the Rudd government?’ It was not a question about employment; it was about real wages.

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! The member for North Sydney will resume his seat.