The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
Picture of Wayne Swan

Wayne Swan

Deputy Prime Minister and Treasurer

3 December 2007 - 27 June 2013

23 October 2012

Press Conference, Sydney

SUBJECTS: 2012-13 MYEFO; Tony Abbott's comments this morning.

TREASURER:

The mid-year budget review shows that we're on track to return to surplus in 2012‑13. I think what it shows is the fundamental strength in the Australian economy. Returning to surplus gives maximum flexibility for the Reserve Bank to cut interest rates and the Reserve Bank has done that repeatedly over the past year. So, if you've got a $300,000 mortgage you're now paying $4,500 dollars a year less than you were paying than when the Liberals were in government. And of course interest rates went up ten times in a row under the Liberal Party and Mr Hockey has himself said in his speech on entitlement that the reason that interest rates went up under the Liberals was because of excessive spending by the past Liberal Government.

So I find it very strange that Mr Hockey would be out there opposing savings measures, because it's very important for interest rate relief and very important for future growth of our economy that we have a good strong fiscal policy, which is now being opposed by Mr Hockey, who has been making some very strange statements. For example, comparing changes to the Baby Bonus to China's ‘One Child Policy'. That's very strange.

On the other hand, you've got the Liberal Party opposing the Schoolkids Bonus which is providing significant relief to families with school costs. For someone with two teenage children, it's worth something like $1,600 a year when they're at high school. That's a very significant amount of money, but that is being opposed by the Liberal Party and Mr Hockey. They have gotten very negative and they're very extreme. Mr Abbott's Liberal Party has become very extreme, so extreme that they're opposing the Schoolkids Bonus and making very silly comments about the Baby Bonus.

JOURNALIST:

But nevertheless Treasurer it's a very slim surplus you're forecasting. Are you setting yourself up for excuses to cover the deficit?

TREASURER:

Returning to surplus is very important as I've said. It gives the Reserve Bank maximum flexibility when it comes to interest rates and it sends a very clear message to the world that Australia's public finances are strong and that's why we have put in place saves, some tough saves, to make sure we return to surplus to keep our economy strong.

JOURNALIST:

Under what conditions could Australia see a deficit?

TREASURER:

Well we will always put in place budget policy which supports growth, and jobs and that's what we've done in the mid-year update.

JOURNALIST:

How do you respond to Tony Abbott's comments this morning about experience?

TREASURER:

Well we will do everything we can to get these changes through the Parliament. It's important for the surplus, it's important for the future of interest rates and we think that the Opposition is being reckless and irresponsible because they are out there opposing changes to the budget which will give the Reserve Bank flexibility to cut interest rates. That's deeply irresponsible. For example, sometime ago Mr Hockey gave a speech in London about entitlements and he talked about the need for there to be changes in the future and when the Government puts in change on the table, we get this bizarre behaviour from Mr Hockey.

JOURNALIST:

But Mr Abbott has apologised. Do you accept his apology?

TREASURER:

Well that's for Mr Abbott to explain. He is being aggressive and he is being negative in terms of the public policy debate for a long period of time but it is up to him to explain what he meant when he said that.

JOURNALIST:

He has apologised for those comments.

TREASURER:

Well it's up to Mr Abbott to explain what he meant, entirely up to him.

JOURNALIST:

What about his comments though that it is more expensive for a second child if they are close together?

TREASURER:

Well let's just go through what we've done in terms of the baby bonus. The rationale for the baby bonus was to help families with the one-off up-front cost of having a child. We have a whole host of other policies, Family Tax Benefit Part A, Family Tax Benefit Part B, Paid Parental Leave, the Schoolkids Bonus, and indeed we increased Family Tax Benefit Part A for families with teenage children because we understand how much children cost over a long period of time. That's what the family payment system is for and the Government is a very strong supporter of family payment system. In fact we have added to it with increased family payments over time. At the moment, we've got the Liberal Party opposing increases in pensions, increases in family payments and we've got the Liberal Party opposing the Schoolkid's bonus, so I don't think they get the cost of living equation at all. Why would they be opposing the Schoolkid's bonus?

JOURNALIST:

(inaudible)

TREASURER:

I made the very sensible point that with a number of children, the up-front costs are always greater with the first. Of course there are ongoing costs and that's why we pay Family Tax Benefit Part A, Family Tax Benefit Part B. That's why we pay the Schoolkids Bonus. That's why we have Paid Parental Leave. Thank you