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Wayne Swan

Deputy Prime Minister and Treasurer

3 December 2007 - 27 June 2013

23 December 2012

Treasurer's economic note

Australians are an optimistic people. We believe that anyone, no matter where you were born or who your parents are, should be able to make a go of it. Sure, we realise life can be tough and things won't always go our way. Our optimism stems not from a belief in our nation's good fortune, but from the knowledge that here - through hard work and determination - we can build a better life for ourselves, our family and our community.

There's no doubt this optimistic spirit has been tested over the past few years. On top of the impact of global financial turmoil and natural disasters, we are also living through a period of unprecedented change. The shift of global economic weight from West to East, the ageing of the population and the digital revolution are among the forces that are reshaping the world around us. It's not surprising that at times like these many Australians may feel anxious or have moments when they question their usually positive outlook on life.

Although the future is not assured, it's important to realise we face our current challenges from a position of unparalleled strength. We end 2012 as the most resilient advanced economy in the world - the economic Iron Man, as OECD Secretary-General Angel Gurria recently called us. We have solid growth, low unemployment, contained inflation, lower interest rates and record levels of investment. And while dramatically lower tax receipts means there's unlikely to be a surplus in 2012-13, we still have one of the strongest budget positions in the developed world. We will keep managing the budget in a balanced way, exercising spending restraint while supporting growth and jobs. Given the continuing uncertainty in the global economy, it's more important than ever that we don't lose sight of our economy's strengths. There's a danger we get dragged down by a pessimism that dismisses our achievements and sells our country short. Only with the right attitude and the right decisions can we keep building a stronger economy and a fairer society.

None of this is to say we should gloss over our challenges. The problem is many of the challenges we hear about on a daily basis bear little connection with reality. We heard absurd claims all year that our economy had stopped growing, that the investment pipeline had run dry, that entire towns were going to be wiped off the map, that consumer prices were about to rise by unimaginable levels, and that our public finances were in a similar state to those of Greece or Ireland or Spain. As the facts show, such statements couldn't be more wrong. They are not only an insult to the huge contribution made by millions of Australian workers and businesses day in and day out, they also have the potential to chip away at confidence. That's ultimately bad for businesses, bad for jobs and bad for our economy.

This sort of negativity comes at the expense of talking about the challenges that really matter - challenges like how we grasp the opportunities of the Asian Century, how we ensure all our children get the skills and knowledge they need to succeed in tomorrow's economy, how we address climate change and build the clean-energy industries of the future, how we embrace the full potential of the digital economy, and how we ensure the benefits of prosperity are fairly shared. These are the sorts of issues that are important for our nation and our people. A more positive, confident and honest national conversation will ensure we keep getting the big economic calls and the big policy decisions right.

I'm minding the shop as Acting PM for the next few days before taking a break, including heading to our usual family holiday spot on the Sunshine Coast, close to where I grew up. I'll be back raring to go with the Economic Note next month. We have much to be optimistic about as a country. My hope is that in 2013 this optimism is more accurately reflected in the public debate. That's the best way to ensure we keep building a stronger, fairer, more sustainable economy that delivers lasting gains for all Australians.

Wayne Swan
Deputy Prime Minister and Treasurer of Australia

www.treasurer.gov.au
twitter.com/SwannyDPM