LINDSAY TANNER: Today's retail trade figures demonstrate that the Government's nation building and jobs plan is working. The Government's stimulus payments are protecting thousands of jobs and countless Australian businesses. And yet today at the National Press Club we saw yet again the underlining of the giant vacuum that exists on the Opposition side of Australian politics. Malcolm Turnbull's solution to our emerging deficit issue is to spend more and to give more tax breaks and make the deficit bigger. And there is not a sign of any kind of savings initiative at all.
Malcolm Turnbull has got 1000 one liners but no plan. The Australian Government is committed to stimulating our economy, to protect and sustain employment, to sustain economic growth and to fight back against the overwhelming pressures that we are getting from the international economy, the global recession that has been battering Australia's economy.
We are facing very, very tough economic circumstances. The Government acted boldly, decisively and early to stimulate our economy, and the retail trade figures today demonstrate both that the Government's strategy is working and just how vacuous and empty the response from the Liberal Opposition is.
Malcolm Turnbull is out there saying that he would borrow to cover the huge loss of revenue, the $200 billion loss of revenue the Government has experienced, that he would borrow in order to stimulate the economy in different ways, yet at the same time he wants to criticise the Government for doing these things.
In fact, the Liberal alternative set out by Malcolm Turnbull today would lead to higher deficits and it would lead to worse economic outcomes.
QUESTION: Is this deficit really temporary?
LINDSAY TANNER: The Government is projecting deficits for a number of years as a result of the huge loss of revenue from the global financial crisis and the recession that's emerged in its wake.
We'll be projecting details of return to surplus in the Budget for next week and we will show a pathway back to surplus. We've already set out some very important rules that we're imposing upon ourselves, rules about future spending, rules about future taxation in order to ensure that we get the Budget back into surplus as quickly as possible.
And the first instalment of the tough decisions that are necessary in order to do that will be seen in the Budget next week.
QUESTION: How severe will the cuts need to be even to reverse this deficit in six years?
LINDSAY TANNER: It's very important that the readjustment that has to occur to the Government's Budget starts now. We have to both stimulate the economy in the short-term but for the medium term change the Budget settings because they have been reflecting a mining boom, huge levels of Government revenue that have melted away in the face of the global recession and that are not coming back in a hurry. It is vital that we don't allow these deficits to continue indefinitely and that we have to take some tough decisions. We don't have to do all the work in one Budget but we've got to make a very important start. We've got to have a big first instalment to that restructuring in this Budget. That's what you'll see on Tuesday.
QUESTION: Minister, are you worried about Australia's AAA rating in the face of these deficits over the projected period?
LINDSAY TANNER: Maintaining our AAA rating is a very important objective for the Government because it reflects not only our wider reputation in the world and as a place for people to invest in, but it also reflects the cost to the Budget that the borrowing that we have to undertake will imply. We are already projecting a cost of $2-3 billion a year in three or four years time, and that's likely to be higher just from the borrowing that we need to do to cover the huge loss of revenue off the back of the global recession. That's a pretty serious hit to the Budget. We don't want to see that go any higher than it has to, and we certainly don't want to see that increase because of a downgrading of Australia's rating. So the Government is very focused on doing everything we can to ensure that we maintain that AAA rating. It's a very important thing for the health of Australia's economy into the medium term.
QUESTION: You mentioned a deficit of about $200 billion. Malcolm Turnbull said it could be as much as $300 billion...
LINDSAY TANNER: The $200 billion figure that has been projected is the projected loss of revenue for the forthcoming four years. It was projected to be $115 billion at the February statement that was made by the Government. It's now going to be in the vicinity of $200 billion. That clearly puts a huge hole in the Budget over the next few years. That's the problem we're dealing with. Malcolm Turnbull's made a variety of claims. He says a different thing virtually every day. He contradicts himself. He's got no coherent plan, no strategy. He's happy to snipe at the Government, which is doing everything it can to protect Australian jobs and to return to strong economic growth in the face of the biggest economic crisis Australia has seen in generations. So I don't take what he says seriously. We're dealing with the realities of this global downturn and its impact on Australian families. And today's retail trade figures show that in these difficult circumstances the decisive steps the Australian Government has taken were the right steps. They are helping to sustain a crucial sector that employs a huge proportion of the workforce, keep people in employment, keep businesses going, at times that are very difficult.
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| Media Contact: | Website: |
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