❓ Shadow Treasurer Nalder questions the Treasurer Wyatt on the state of the WA economy prior to COVID-19. Wyatt deflects, blaming the previous Liberal-National government's economic performance and highlighting current government achievements.
AnsweredQoN 389Legislative Assembly
QuestionView source ↗
CORONAVIRUS —
ECONOMIC RECOVERY
389. Mr D.C. NALDER to the Treasurer:
I note the Treasurer's
comments about the economic and financial impact of COVID-19 on the March
quarter financials. Does the Treasurer acknowledge that the domestic economy
was already in survival mode prior to COVID-19, and that in January 2020 we had
experienced ongoing business investment decline, record levels of mortgage
stress, a mortgage default rate nearly double the national average and the
worst retail trade numbers in three years?
ECONOMIC RECOVERY
389. Mr D.C. NALDER to the Treasurer:
I note the Treasurer's
comments about the economic and financial impact of COVID-19 on the March
quarter financials. Does the Treasurer acknowledge that the domestic economy
was already in survival mode prior to COVID-19, and that in January 2020 we had
experienced ongoing business investment decline, record levels of mortgage
stress, a mortgage default rate nearly double the national average and the
worst retail trade numbers in three years?
AnswerView source ↗
I thank the shadow Treasurer for
the question. I recall that during the second term of the former Liberal–National
government, in not one year did state final demand grow—not one year.
At no point during the second term of the Liberal–National government
was a job created. I note that the member referred to mortgage stress. The peak
of repossessions in WA and the peak activity of banks taking property off Western
Australians happened under the former Liberal–National government. That
is the reality.
It is interesting that the member
should say this about business investment, because I am going to say it again.
In my answer just a minute ago, I made the point around private new capital
expenditure. The WA Liberal Party these days
is very much about big government. It wants the government to do everything and
crowd out the private sector . That was certainly the Barnett government
years in any event, and it seems to have stuck in the psychology of the Liberal
Party. I want to make this point: in the March quarter, private capital
investment grew by 7.8 per cent—the largest growth since 2013. At a national
level, that quarter shrank by 1.3 per cent. Western Australia was doing what it has historically done, leading by business
investment, therefore leading economic growth, which is why we were
expecting economic growth of three per cent, again the strongest in five years.
There
is no doubt that when we came out of the Liberal–National recession in
2016–17, it took some time to recover from that. Jobs were being
created, confidence had returned, employment was growing at not just a monthly
rate but also an annual rate and, finally, the retail figures were starting to
get better again. I think a specific part of the member's question was
about retail. If you like, there are two components to the pressures on retail:
firstly, a long period of weak wages growth, a global phenomenon; and,
secondly, the shift to online purchasing. There is no doubt about that. What
will be interesting in 12 months from now is where the retail space is, bearing
in mind there has been a huge increase in online retail spend. Once that
behaviour starts, often people become embedded in the behaviour, so it will be
challenging for the Western Australian
retail sector to try to compete in that space. However, the data I am seeing
around Australia indicates that a lot of shopfronts shifted to online very
effectively and have been doing that as well. However, what is undisputed and
despite any political rhetoric, it is clear that the finances were unbelievably
better in March this year than they were when I became Treasurer. If we had not
done the work in those first three budgets, there is no way we would have been
in a position to respond to the economic impacts of the coronavirus. There is
no way we could have spent $1.8 billion. Do members know why? We would not have
been able to raise the money.
Mr D.C. Nalder interjected.
Mr B.S. WYATT : There it is.
Eric Ripper used to refer to it as jam-jar economics. I like that; it is about
looking at one revenue source without looking at the balance sheet. That is
what the member for Bateman does.
Mr D.C. Nalder interjected.
The SPEAKER : Member for
Bateman, I will give you another one. I call you to order for the first time.
Mr B.S. WYATT : He is
obsessed by one source and as a result, has convinced his leader to make $4.5 billion worth of spend. That has always been the
danger of the WA Liberals. They look at one source of revenue and spend three times that amount. I can also tell the
member—I hope the member for Bateman has read the document I tabled
today, because I think it is important and he might be educated—that
the GST pool is down; payroll tax is down, property taxes are down and licence
taxes are down.
Mr D.C. Nalder interjected.
Mr B.S. WYATT : The member
has not read it. I cannot believe he has not read it. I tabled it some hours
ago. The shadow Treasurer should read the document and he will find out.
Mr D.C. Nalder interjected.
The SPEAKER : Member for Bateman, I call you to order
for the second time.
Mr B.S. WYATT : The reality is
that revenue is down and it is only because of the efforts we went through in
the first three years of the McGowan Labor government fixing the mess left to
us by the WA Liberals, who spent like there was no tomorrow, that we have been
able to do what we have to protect households and businesses.
the question. I recall that during the second term of the former Liberal–National
government, in not one year did state final demand grow—not one year.
At no point during the second term of the Liberal–National government
was a job created. I note that the member referred to mortgage stress. The peak
of repossessions in WA and the peak activity of banks taking property off Western
Australians happened under the former Liberal–National government. That
is the reality.
It is interesting that the member
should say this about business investment, because I am going to say it again.
In my answer just a minute ago, I made the point around private new capital
expenditure. The WA Liberal Party these days
is very much about big government. It wants the government to do everything and
crowd out the private sector . That was certainly the Barnett government
years in any event, and it seems to have stuck in the psychology of the Liberal
Party. I want to make this point: in the March quarter, private capital
investment grew by 7.8 per cent—the largest growth since 2013. At a national
level, that quarter shrank by 1.3 per cent. Western Australia was doing what it has historically done, leading by business
investment, therefore leading economic growth, which is why we were
expecting economic growth of three per cent, again the strongest in five years.
There
is no doubt that when we came out of the Liberal–National recession in
2016–17, it took some time to recover from that. Jobs were being
created, confidence had returned, employment was growing at not just a monthly
rate but also an annual rate and, finally, the retail figures were starting to
get better again. I think a specific part of the member's question was
about retail. If you like, there are two components to the pressures on retail:
firstly, a long period of weak wages growth, a global phenomenon; and,
secondly, the shift to online purchasing. There is no doubt about that. What
will be interesting in 12 months from now is where the retail space is, bearing
in mind there has been a huge increase in online retail spend. Once that
behaviour starts, often people become embedded in the behaviour, so it will be
challenging for the Western Australian
retail sector to try to compete in that space. However, the data I am seeing
around Australia indicates that a lot of shopfronts shifted to online very
effectively and have been doing that as well. However, what is undisputed and
despite any political rhetoric, it is clear that the finances were unbelievably
better in March this year than they were when I became Treasurer. If we had not
done the work in those first three budgets, there is no way we would have been
in a position to respond to the economic impacts of the coronavirus. There is
no way we could have spent $1.8 billion. Do members know why? We would not have
been able to raise the money.
Mr D.C. Nalder interjected.
Mr B.S. WYATT : There it is.
Eric Ripper used to refer to it as jam-jar economics. I like that; it is about
looking at one revenue source without looking at the balance sheet. That is
what the member for Bateman does.
Mr D.C. Nalder interjected.
The SPEAKER : Member for
Bateman, I will give you another one. I call you to order for the first time.
Mr B.S. WYATT : He is
obsessed by one source and as a result, has convinced his leader to make $4.5 billion worth of spend. That has always been the
danger of the WA Liberals. They look at one source of revenue and spend three times that amount. I can also tell the
member—I hope the member for Bateman has read the document I tabled
today, because I think it is important and he might be educated—that
the GST pool is down; payroll tax is down, property taxes are down and licence
taxes are down.
Mr D.C. Nalder interjected.
Mr B.S. WYATT : The member
has not read it. I cannot believe he has not read it. I tabled it some hours
ago. The shadow Treasurer should read the document and he will find out.
Mr D.C. Nalder interjected.
The SPEAKER : Member for Bateman, I call you to order
for the second time.
Mr B.S. WYATT : The reality is
that revenue is down and it is only because of the efforts we went through in
the first three years of the McGowan Labor government fixing the mess left to
us by the WA Liberals, who spent like there was no tomorrow, that we have been
able to do what we have to protect households and businesses.
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