Media Release: Robb Gaffe Shreds Liberals' Economic Credibility

17 January 2012

Today’s comments by Andrew Robb in The Australian are the final nail in the coffin of any economic credibility the Liberals still had.

Comparing Australia’s economy to Iceland and Ireland is reckless and incredibly irresponsible.

These kinds of ill-informed comments show the Liberals’ determination to talk the economy down is downright dangerous to the economy and to the living standards of every Australian.

The reality is Australia’s net debt will peak at 8.9 per cent in 2011-12 – less than one tenth of the average net debt position of the major advanced economies expected in 2016 (table below).

Our economic fundamentals are strong - we’ve got strong growth, low unemployment, contained inflation and very low debt.

Even Tony Abbott thinks so, when he bragged about the Australian economy in London:

…. Our net government debt, Commonwealth and state, about 8 per cent of GDP; our collective budget deficits just under four per cent of GDP and net interest payments just under 2 per cent of government outlays.

On the face of this comparative performance, Australia has serious bragging rights. Compared to most developed countries, our economic circumstances are enviable. 

And just recently Australia was awarded the coveted gold-plated AAA rating from all three global ratings agencies.

In June 2007, there were 16 countries rated AAA by all three ratings agencies while today there are just 12 (and only 9 with a stable outlook).

In 2007 under Howard, Australia was not one of those countries.

Under the Gillard Government, we are one of only 12 countries in the world with a AAA rating from all three agencies (and one of only nine with a stable outlook).

Australians should be very concerned about the economic circus that sits on the Coalition front bench.

This is from a party whose Treasury spokesman announced a $70 billion hole in the Liberals budget on live television – confirmed later by Andrew Robb.  And who’s so-called election auditors were found guilty and fined for professional misconduct.

It is time for Andrew Robb and the Liberal Party to put Australia’s economic interests first and stop talking Australia down.

Background on net debt

Australia’s net debt will peak at 8.9% of GDP in 2011-12 – less than one-tenth of the average net debt position for major advanced economies expected in 2016.

Expected net debt as a % of GDP in 2016 (source: IMF Fiscal Monitor, September 2011).

  • Major advanced economies – 92.9%

    • US – 88.7%

    • UK – 72.5%

    • Japan – 166.9%

    • France – 81.9%

    • Germany – 55.3%

    • Italy – 94.8%

    • Canada – 33.3%

    • Iceland – 53.4%

    • Ireland – 100.3%

Abbott Speech – 1 November to the Policy Institute, London