We're not just a lucky country
TUESDAY, 12/6/2012 Julia Gillard
In the last week, there has been a growing understanding among Australians that our economy really is among the best in the world.
Independent commentators, international ratings agencies, the IMF, OECD, World Bank and the Governor of the Reserve Bank are now all talking about how strong our economy is– perhaps stronger than many realise.
Of course there are still some doomsayers. But as the saying goes, you can choose your own opinion, but you can’t choose your own facts.
So these are the facts. Our economy has grown by 4.3 per cent in the last year and created 39,000 jobs in the last month.
In just over four years the Euro area economy has shrunk 1.7 per cent. Japan’s economy has shrunk 1.7 per cent. The United States’ economy has grown – just – by 1.2 per cent. And the Australian economy has grown 10.3 per cent.
Here’s another fact: Australians have created more than 800 000 new jobs in five years. And another: tax as a percentage of GDP is at long-term lows.
We’re delivering a Budget surplus in 2012-13, and growing in subsequent years, because we have reined in spending to levels not seen for nearly three decades.
This week in Brisbane, the Deputy Prime Minister and I are bringing together 130 leading Australians, from government, business, unions and the wider community to discuss Australia’s future in the global economy.
We’ll discuss the difficult circumstances affecting the world economy and new ideas to address uneven growth at home. We won’t shy away from hard questions because we are committed to keeping our economy strong: creating jobs, driving growth and improving productivity.
But we’ll start with the facts about how well Australia is doing, because unless we appreciate our own strength, we can’t use our strength to build for the future. We’ll confront the truth that one of the biggest challenges for parts of our economy is actually created by our overall strength.
The Aussie dollar hasn’t been this high for this long since it was floated. The strength of the dollar reflects the economic transformation of Asia and the continued demand for Australian commodities. It also reflects the strength and stability of our economy in these turbulent times. The high dollar is a huge game changer.
Some of that change is good: businesses that need equipment from overseas can get it more cheaply. Household goods that every family needs cost less.
Australians can enjoy the results of our hard work by travelling overseas in numbers our parents and grandparents would have only dreamed about.
But the high dollar is exacting a price: it is a really hard slog for every Australian business which exports. Things we make and sell overseas are more expensive for the foreigners who buy them. The fact the dollar has risen so sharply and relatively quickly has made adjusting very difficult for Australian businesses – particularly in manufacturing, tourism and international education.
For the whole of the Australian economy, the critical pillar of our response to these structural changes is being prepared to get in and shape this change, not hide from it or cower in the face of it.
From innovation and infrastructure to skills and competition, we are shaping change. We’re investing in and driving the uptake of clean energy, high speed broadband and new infrastructure, we’re lifting skills and engaging in tax reform and deregulation. Much of the work is difficult, some of it is controversial – but all of it is necessary.
And we must do more. Our reform effort reflects our continued commitment to jobs, productivity and growth. But the reform journey cannot be walked alone; it must involve all parts of our society working together.
We have the best workers in the world. We can do more to help ensure that people who need jobs get the jobs that our strong economy is creating.
Joining up the people who need work with the businesses who need people is often difficult – but it’s a challenge that has to be met. We are continuing to work on regulatory obstacles to labour mobility, and to get rid of regulations that artificially impede productivity.
We've put in place incentives to get people from welfare to work. We are boosting workplace participation through reforms to employment services and ensuring people on low incomes pay less tax.
We are looking at new ways to improve opportunities across the economy through things like letting trades people work more easily interstate and investing in child care. If fewer parents relied on extended family for childcare they might be more prepared to move interstate. So we’re working on improvements here as well.
While shaping change is at the heart of our efforts, confidence is the soul of our sense of economic well-being. You don’t get hard things done without believing in yourself.
It probably wasn’t golfer Gary Player who first said, “The harder I work, the luckier I get”, but he certainly made that quote his own. He could have been talking about Australia. If we ever were just a lucky country, we’re certainly not now.
Luck didn’t give us the three triple-A ratings for our budget which only seven other economies with stable outlook can claim – and which no previous Australian Government can claim either. Luck didn’t keep us out of the worst global recession in eighty years.
No, we did it with reform, good decisions and with confidence.
Today and tomorrow in Brisbane, we’ll be sitting down with business and community leaders and working on new grounds for confidence and new ideas for reform.
We have every reason to be optimistic as Australians about the future of this country. I firmly believe our nation’s best days are still ahead of us.