May 10, 2006

One small step forward, three large steps back


Wayne Swan MP

Federal Labor Shadow Treasurer

10 May 2006

Tonight’s tax relief for hard working Australian families is one small step forward after three very big steps back.

Labor welcomes the tax relief contained in the budget.

But families in middle Australia are going to need every cent of the relief they received tonight to pay for the triple whammy they are facing:

1. Rising Interest Rates

2. Increased Petrol Costs

3. An attack on wages by the Howard Government’s extreme industrial relations changes.

The only plan Peter Costello has to help middle Australia pay more for fuel and pay more for interest rates is to give them some of their own money back.

Peter Costello has declared tonight that the Australian economy has enough capacity to absorb any expansionary pressures contained in the budget.

The Reserve Bank has warned that long neglected capacity constraints will only increase this pressure.

Peter Costello better be right, and Labor truly hopes he is.

Short term tax relief is welcome but in tonight’s budget there is no long term plan to protect Australian families from higher interest rates.

To protect Australia from the threat of higher interest rates we need to eradicate existing capacity constraints and lift Australian productivity.

To boost Australian productivity we must invest in our workforce, but Peter Costello continues to turn away young Australians from training, instead importing foreign workers.

The Howard Government’s skills shortage is not going to solve itself; unfortunately Peter Costello’s speech tonight makes it clear he is not going to solve it either.

Australia’s crumbling roads, rail systems and ports are holding back the Australian economy, but after 11 Costello budgets there is still no national infrastructure plan.

Tonight’s ad hoc infrastructure funding announcements are designed more to shore up Deputy Prime Minister Mark Vaile than build Australia’s future economic prosperity.

Peter Costello’s childcare announcement is an attempted con on working families which will do nothing to help parents return to the work force.

Tonight’s announcement does not guarantee one new childcare place for hard working Australian families.

Without a boost in Australia’s competitiveness, we will not lift our export performance and we will not reduce our escalating foreign debt.

In the long term these are a serious threat to our future economic prosperity.

Closing your eyes doesn’t make the threats to Australia’s economy disappear. But listening to Peter Costello tonight, he obviously hopes it will.

In his 4046 word speech Peter Costello did not mention four of the biggest challenges to the Australian economy.

He failed to utter the words productivity, participation, education or the current account deficit even once.

Ignoring these issues is no way to protect our future prosperity.