Page 1193 - Week 04 - Tuesday, 24 March 2009
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MS GALLAGHER: Thank you, Mr Speaker. I will struggle on; I don’t sound great. I would encourage Mrs Dunne to look at what is happening around the world. It has now been called the global economic recession. Nineteen of the 22 OECD countries are actually in recession. The federal government is doing what it can at the moment to avoid the Australian economy going into a recession, although comments from the Treasurer and the Prime Minister recently showed the difficulty they are facing in that regard.
When you look at the technical recession that we are in, the September quarter figures were revised backwards in the December release of the national accounts figures. Commentators have spoken of the volatility of public sector investment and its impact on the ACT economy. And when you look at what was the most significant impact in the figures for the ACT in the December quarter, it was about a 28 per cent drop in commonwealth investment, and that has a 1.3—
Mr Seselja: “It’s not our fault”!
MS GALLAGHER: If you look at the impact and read the national accounts, you see the volatility that exists from the commonwealth government and the ACT government at times. Having regard to the impact of public investment, you will see that, almost completely, the 28 per cent drop, which equals about $121 million in investment, was as a result of the reduction in commonwealth investment. It had an impact of 1.3 per cent.
Our economy remains strong. Our unemployment rate remains the lowest in the country. It is forecast to grow, but we do not expect it to hit the rate of the national unemployment figures. Investment remains strong; household consumption and private sector investment has increased. These are all measures of an economy that has underlying strengths.
The technical recession is there. Nobody is walking away from that, and we need to respond to it. But we also need to support the economy in the language that we use. This is a little warning to Brendan Smyth, having regard to some of the language he uses: our economy remains strong. Yes, we need to respond to the current economic climate, but we will do so in a measured way that will not be a knee-jerk way. We should be supporting our economy by instilling confidence in the community, not by doing what the opposition are doing.
MR SPEAKER: Mrs Dunne, a supplementary question?
MRS DUNNE: Thank you, Mr Speaker. Minister, if the commonwealth has had such an impact on the ACT economy, why did the then Treasurer, your leader, Jon Stanhope, say on 14 May last year in relation to commonwealth spending cuts that they certainly will not have a significant impact?
MS GALLAGHER: I would have to look at the context of that statement. If it was about the commonwealth investment drop—and we are still seeking answers on what projects that actually was—of $121 million in the December quarter, what we are talking about is the volatility that that has on the national accounts figures.
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