Tuesday, 2 September 2008
Questions without Notice
The purpose of a surplus is to ensure that we on this side of the House, through a responsible budget, are doing our part through fiscal policy to bring about downward pressure on inflation and downward pressure on interest rates. That might be a difficult concept for those opposite. It is a very clear-cut concept for those on this side of the House.
Opposition members interjecting—
Secondly, when you saw the explosion in public demand which occurred on the back of five per cent real expenditure growth through the government sector by those opposite in the previous year, you began to see the array of challenges faced by the Reserve Bank in bringing interest rates down. What you had was public demand effectively roaring along at great guns and no investment in terms of supply-side constraints in the economy as well. What does that lead to? An interest rate challenge—