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

17 April 2013

Doorstop

Doreen Costa Exchange
Victoria

SUBJECTS: Visit to McEwen; Tony Abbott's Policies Hurting Families; IMF World Economic Outlook; Budget; Carbon Price

TREASURER:

Well it is great to be here this morning at Costa Mushrooms with Rob Mitchell, the Member for McEwen. This is a really important enterprise in the local area. Production in terms of the production of mushrooms around Australia is quiet important and over 500 workers here involved in the production process, harvesting and the distribution.  So it was good to hear this morning about all of the skills and all of the training that those workers receive and to see the product go out the door and it is an important part of Australia's economy. So it's really good to see the innovation, the application and commitment of the management and the workforce to this very important enterprise and certainly a large part of our local economy.

I know Rob Mitchell understands that. He is one of most dedicated and passion MPs that I have met in my 20 years in politics. And getting out and about to local worksites like this is what being an MP all is about.  And it is also all about getting out to our local schools. Rob tells me there are about 130 schools in the electorate McEwen.  Every single one of those schools will be a major beneficiary of the school improvement programme that the Prime Minister is taking to COAG later this week. We got to make sure that no child in Australia in education is left behind.  And sadly, in too many schools, there aren't enough resources, there aren't enough teachers, there aren't enough back-up staff to help people with special challenges, there aren't enough people dealing specifically with literacy issues and so on. So the Gonski school improvement program is all about lifting up all Australians, making sure no child is left behind and making sure that everybody gets the best start in life. So I would urge the Premier of Victoria to put the kids of McEwen first, and to come to an agreement with the Federal Government because it will mean an extra $4 billion dollars in terms of Victorian schools over a period of time. Nothing, absolutely nothing is more important to the future of our country than having our young people well educated and leaving nobody behind in that process. And I think we can see here today to just how important it is to have staff who are well trained and committed to their jobs. And all of that starts in our education system. The commitment, the application, the learning, this is all an important part of our life and an important part of making our country a better place.

Also here in McEwen we have a large number of workers who work for modest wages. They work hard to get ahead, to look after their families. Many workers here, some 60,000 workers in this electorate, have been beneficiaries of the tripling of tax free threshold. It has given a tax cut to many people in low incomes. And of course that is something that Tony Abbott wants to rip away. Just like he wants to rip away the Schoolkids Bonus from 12,000 families.

That Schoolkids Bonus is a pretty important part of getting families the financial assistance they need to get their kids back to school, to buy the books, to get the educational aides and so on. That would also be ripped way.  As would the Low Income Superannuation Contribution of up to $500 which goes to workers who earn less than $37,000 a year, ripped away. I think what  we see when we see Tony Abbott and his attitude to the  Schoolkids Bonus, tripling the tax free threshold and low income superannuation, and the fact that he won't submit  to the school improvement program, is that he has a policy that will cut to the bone when it comes average Australian families. And here in McEwen through the efforts of Rob Mitchell, of the Gillard Government, we are providing very extensive support for families on modest incomes who work hard to have a better life and to make our country strong. So it was great today to see the efforts of so many locals. I'll throw to Rob.

MITCHELL: 

Thanks Wayne, and as the Treasurer said, the seat of McEwen is one of the fastest growing seats in the country. And here in the city of Whittlesea, the need for infrastructure to keep up with growth and demand is very high. It's only Labor Governments that you see investments in schools, investments in childcare and investments in infrastructure that actually helps our community. Now with the COAG meeting as you pointed out this week, it is vitally important that Premier Napthine steps up to the plate and start investing in schools in growth areas like Mernda and Doreen where we have a need for extra secondary schools, we have a need to make sure that teachers get the right resources, including reading recovery, support with maths, support for those kids that are falling behind. And importantly support for the kids that are actually excelling and giving them the opportunity to grow with their abilities and to make sure kids do get the best start in life that they can.  So it is a great pleasure to have Wayne here today to be talking to the local community, meeting with local workers and just showing how the Gillard Government is looking after their interests and Australia's interest first. So thanks for being out here today Wayne.

JOURNALIST:

Wayne Swan, the International Monetary Fund has cut world economic growth forecasts, so how long does that mean that Australian will stay in a deficit for?

TREASURER:

Well we have seen overnight a reaffirmation from the IMF about the strength of the Australian economy. The Australian economy is forecast to grow three per cent next year and three and bit per cent the year after. That's more than twice the growth rate of other advanced economies in the IMF forecasts.  So I think what that shows is that unlike other countries we have got a very resilient economy.  We've got solid growth, we've got low unemployment, we've got a strong investment pipeline, we've got lower interest rates and we've got contained inflation. And what that means is that our economy is 13 per cent larger than it was at the end of 2007.  Whereas, I think it is half of the advanced economies in the world have contracted in that period…

JOURNALIST:

We do compete in that global market

TREASURER:

We do.

JOURNALIST:

So how long will we be in a deficit as a result?

TREASURER:

We do compete in the global market and we are much more resilient than other economies. However global economic conditions have had a fundamental impact on government revenues.  And essentially global economic conditions have taken the axe to government revenues.  The fact that there has been uncertainty in the global economy, the fact that we have a higher dollar as a consequence of global uncertainty has taken an axe to government revenues. The Australian Government makes it very clear that we will always support jobs and growth and just because the global economy takes an axe to our revenues, we're not going to take an axe to jobs in Australia.

JOURNALIST:

How far off is a surplus as a result?

TREASURER:

These are matters which will be for the forecasts in the Budget.

JOURNALIST:

The carbon price in Europe has plummeted down to three Euros, what does that mean for the carbon tax system here?

TREASURER:

Well we will examine that in the context of preparing all of our forecasts for the Budget, and we always go back and look at the assumptions that under pin those forecasts and we will do that in the usual way

JOURNALIST:

Greg Combet has already forecast debt downgrades in the budget, how much will they be?

TREASURER:

Well what I have said is that we will look at all of our assumptions and forecasts in the budget and we'll do that in the normal way.

JOURNALIST:

Just on this topic, we are linked to the European market, I believe that the systems hook up in 2015, what does that mean for us?

TREASURER:

Well as I said we will examine all of that in the context of preparing the Budget.

JOURNALIST:  Surely you are across the brief and can give the public some idea as a result of this news overnight from Europe?

TREASURER:

Well as I said we will prepare our forecasts for the Budget in the normal way.

JOURNALIST:

So Professor Ross Garnaut has suggested that the RBA should step in under the right circumstances and should lower the Australian dollar. What are your thoughts?

TREASURER:

Well I think the Reserve Bank can speak for itself, it acts independently. But it has made it very clear in any number of its statements in recent times that it takes into account the value of the dollar when it is setting monetary policy.

JOURNALIST:

Garnaut also went on to say that when China's minerals - or mining boom -busts Australia will collapse as well. Do you think that is a fair call?

TREASURER:

I think Australia has a bright future, we have a very strong investment pipeline in mining.  We are now moving into a production phase and an expansion of our exports, not just to China, but to the rest of the region. I am an optimist about growth in Asia more generally, not just in China. And the growth in the middle classes across the Asian region will produce demand for a whole range of goods and services, not just in resources, not just in agriculture, but across a wide range of activities and I think the consequence of that will only be good for Australia.

JOURNALIST:

And what will the consequences of a downturn in China mean for Australia?

TREASURER:

Well people ask this question all the time. The fact is that the Chinese economy is growing strongly. The Chinese economy will continue to grow strongly for some time to come.  But of course there are phases in the economic cycles globally which are a consequence of what happens elsewhere in the global economy. One of the problems for the global economy is that Asia is doing all the heavy lifting. It is the policy of a number of advanced economies, particularly in Europe, which are a real drag on global growth, which in turn impacts upon growth in China and the rest of the global economy. Essentially what you are seeing is the impact of harsh austerity in Europe which is acting as a drag on global growth and you can see that in the IMF forecasts that have come out overnight. I'll leave it there, thanks very much.