ADDRESS TO THE 2020 CEDA ECONOMIC AND POLITICAL OVERVIEW
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I want to acknowledge the Wulgurukaba and Bindal people, and thank you all for coming along today.
Thanks Clint (O’Brien) for the invitation; Phil (Garling) for the introduction; Fay (Barker) for the overview; Michael (Blythe) for the insights and Rochelle (Finlay) for directing traffic in the discussion.
This year we mark CEDA’s 60th birthday.
For six decades CEDA has been a platform for substance, a forum for big ideas and an advocate for progress – and long may that continue.
It’s great to be back here again launching another Overview.
Senator Nita Green is here with me today and we’ve just come from a tour of the brand new QCB Stadium.
In 2015, I was the Shadow Minister for Sport when Federal Labor pledged $100 million towards a state of the art facility for Townsville.
And we waited 6 months for the LNP to match that promise – but you know what – I’m so glad they did.
I’m glad our opponents recognised our policy was a good idea, even though it wasn’t their idea.
It’s a shame there isn’t more of it in politics.
Not just in infrastructure commitments – but in the big debates and decisions which take our country forward.
I know that since I last spoke to CEDA here in 2018 Townsville and North Queensland have had a rough trot.
This time last year the clean-up had only just begun from some of the worst flooding you’ve seen here.
And while a lot of the damage has been repaired and services have been restored, there is always harm that takes longer to fix and scars that take longer to heal.
I’ve got family here. And I know if there’s one thing about the people of Townsville, they are resilient. And I’m so pleased to see signs of recovery around town.
A few weeks after last year’s election, Senator Anthony Chisholm and I went on a 2,800km road trip through Maryborough, Mount Larcom, Rockhampton, Mackay, Proserpine, Bowen, Ayr, Townsville, Sarina and Gladstone – after an earlier trip to Cairns.
We wanted to hear from the Queenslanders Labor failed to connect with during the campaign and we were bracing ourselves for some hard truths and some free character assessments.
In fact, what we got was a refreshing, revitalising reminder that most people don’t dwell on the results of elections past.
Queenslanders are focused on bigger, more important and more pressing priorities.
And I don’t just mean the Cowboys v Broncos here in three weeks.
I mean the pressures of low wages growth and insecure work, the struggle with rising child care costs, rising health care costs and rising power bills.
Queenslanders care a lot more about the future of their environment, the future of their community, the future of our health care and aged care and education systems…than they do about past election results.
They don’t sit around wondering why Labor didn’t win enough Queensland seats; they lie awake wondering how they’ll feed the kids and pay the bills.
That’s why the task Anthony has set for all of us is to focus on people, the economy, the future – and on Queensland.
Obviously Labor can’t succeed unless we go well here.
Last year we managed to win just six out thirty Federal seats in Queensland.
In the last fifty years Federal Labor has never formed majority government without holding at least one-third of the seats here. By this measure, we need to win at least another four seats in Queensland at the 2022 Election.
A few more facts for the political junkies:
Labor has only once managed to win government from opposition with less than 44 per cent of seats in Queensland, and that was 91 years ago.
We’ve done even better than that, at times. Under the Hawke and Keating Governments, Labor won more than 50 percent of seats in Queensland in four out of five elections.
And Kevin Rudd won 15 of 29 in 2007.
A pretty simple point: there is no road to victory that doesn’t come up the Bruce Highway.
A more important point is that Australia cannot succeed without Queensland doing well.
This is made clear in CEDA’s Economic and Political Overview.
So we’ll be up here regularly and right through regional Queensland listening and working with you to develop an economic growth strategy which addresses the immediate, pressing challenges in our economy.
This is why Anthony Albanese has already made 13 trips to Queensland in only nine months.
It’s why he appointed Murray Watt as Shadow Minister for Northern Australia and why our Senators Anthony Chisholm and Nita Green are out working so hard in regional Queensland.
And it’s one of the reasons Anthony Albanese asked me to take on the role of Shadow Treasurer.
That gives our team the best chance of understanding the diverse economic challenges our state faces.
Since federation the Labor Party has appointed five Treasurers from Queensland. And they’ve been from right across the state – Bill Hayden from Ipswich, Wayne Swan from the Sunshine Coast then North Brisbane, Andrew Fisher from Wide Bay, William Higgs from Rockhampton and Ted Theodore from the Tablelands around Cairns.
Federal Labor’s Queensland Treasurers reflect the diversity of our state and the unique economic challenges we face.
We haven’t had one from Logan yet but I’m working on that!
By comparison the Liberal Party has never appointed a Treasurer from outside Sydney or Melbourne since the war.
The Country Party’s Arthur Fadden’s short stint in 1941 represents the sole occasion in which the conservative side of politics has appointed a Treasurer from Queensland.
On our side we do genuinely understand that we can’t grow the national economy fast enough to create jobs and opportunities in our society until and unless the Queensland economy grows strongly.
The story here is a mixed bag.
On some measures of employment and consumption the state is travelling better than others.
Queensland’s exports are booming – with beef, LNG, new economy minerals and metallurgical coal the biggest contributors to $85 billion worth of goods shipped from here.
But Queensland’s economy currently sits fifth on CommSec’s State of the States Report.
Why does this matter for the national economy?
Because since 1990 in every year except two:
• When the Queensland economy has grown above average, the Australian economy has grown above average; and
• When the Queensland economy has grown below average the Australian economy has grown below average.
In other words, where goes Queensland, goes Australia.
We can’t turn national economic underperformance around without Queensland, which represents almost a fifth of Australia’s Gross Domestic Product.
As Deloitte noted in their Business Outlook last week Queensland’s exposure to global commodity markets means we generally have bigger business cycles than other states but our diversity means we are less exposed than Western Australia.
The last time we had a Federal Labor Government with a Queensland Treasurer, average growth was higher than under the LNP.
Higher in Queensland; higher across Australia.
And as someone who hopes to be part of the next Labor Government with a Queensland Treasurer, I know that if we want to grow the Australian economy more strongly, more broadly and more fairly – then we need a substantial growth strategy for Queensland in Canberra.
And that growth strategy can’t live and die on the strength of the south-east corner either.
When I talk about growing the Queensland economy, that means regional economies.
A full third of Queensland’s economic output comes from great regional cities like this one.
Four of five goods exported from Queensland are being shipped from regional ports around the state.
And the Commonwealth Government should be in the business of nurturing and enabling these regional economies: investing in local skills, local jobs and local infrastructure.
If we want a template for this, we can look at the work being done by the state government and Jenny Hill here in Townsville through the Building Our Regions program and the Jobs and Regional Growth Fund.
But there’s only so much local and state governments can do to take up the slack and cover for the complacency in Canberra.
Direct federal government investment in Queensland under the Coalition has grown by just 4 per cent.
Under the Rudd and Gillard Governments it grew by nearly 60 per cent.
Currently the Palaszczuk Government and Queensland’s local councils are doing a heap of heavy lifting and contribute almost 80 per cent of total government investment in Queensland.
Comparing this year to last year, state and local governments have increased their investment in Queensland by $1.2 billion.
Time and time again we see examples where Queensland is short-changed on critical infrastructure projects.
During the last election the Liberals failed to match Labor’s commitments here and across our state including:
• $100 million to upgrade the Mount Isa to Townsville Rail Corridor;
• $500 million for Queensland rural and regional road improvements;
• $500 million for Ipswich Motorway Upgrade – Rocklea to Darra;
• $100 million for the Gladstone Port Access Road Extension; and
• $2.24 billion for Cross River Rail.
What’s the point of holding 23 out of 30 seats in Queensland or being a quarter of the Coalition partyroom if Queensland is going to be continuously short-changed?
There is one final point I would like to make about how the people and economy of this state is talked about in Canberra.
And I say this as a very proud Queenslander:
I resent the dumb caricature put about by people like Matt Canavan, who pretends Queenslanders don’t care about climate change.
Or that we don’t understand the possibilities of cheaper, cleaner energy for families and businesses.
Of course, there are a range of views in Queensland – as there are in every state.
But it's not beyond us to find a way to promote new investment in the renewable industry, and treasure our environment, without abandoning our traditional strengths in mining and the jobs and communities it supports.
And when I look at sites like the Townsville Zinc Smelter – high-grade metal manufacturing, running on solar power, it fills me with confidence that there are practical ways to maximise the diversity of Queensland’s economic potential – from agriculture, mining, tourism and technology.
And that Australia’s sensible, measured transition to a clean energy future can actually be led from here, by Queensland industry, Queensland business and Queensland households.
I said earlier that most of the people I meet, here and elsewhere around Australia, don’t spend a lot of time dwelling on the last election.
There is one notable exception to that.
Nine months after the election, Scott Morrison is still on a bit of a victory lap. His premiership hangover has put governing on hold.
And at the worst possible time – when Australia needs a plan for the economy, for energy, to rebuild after fires and respond to Coronavirus.
Obviously, this has been beyond a tough summer for communities around Australia.
And while the response of everyday citizens has been nothing short of heroic, I think most agree that national leadership was lacking.
And yet now, the Prime Minister, who has been five steps behind the country at every stage of this Black Summer…
…who has been slow to act, slow to lead, slow to acknowledge his faults, slow to apologise…
… has only discovered speed and urgency when it comes to blaming the fires and the floods for an economy which was underperforming on his watch well before either hit.
It is shameful that while people in Queensland and New South Wales and Victoria are still grappling with their insurance claims and their clean-up…
…the Prime Minister and the Treasurer are only interested in taking out political insurance for their economic failures.
We’re already seeing this with the Coronavirus too.
I appreciate this outbreak and the travel ban is of particular concern to North Queensland given the importance of tourism to this region.
And to Far North Queensland as well, which is why I’m off to Cairns tomorrow for discussions with the tourism industry alongside Nita Green.
Obviously disaster and disease, and responses to both, will have an effect on the Australian economy and the state of the budget.
How big remains to be seen.
But neither of these two – on their own or combined – excuse the longer term faltering of the Australian economy, or this government’s record.
As the Reserve Bank has pointed out our economic challenges are longstanding and they’re home grown.
Since the election economic growth has slowed; it’s almost halved since Prime Minister Morrison and Treasurer Frydenberg took over.
As a result Australia has gone from being the eighth fastest growing economy in the OECD in 2013 to the 20th fastest growing economy now.
Wages growth is stagnant, underemployment is high and consumption is growing at its slowest pace since the Global Financial Crisis.
Business investment, productivity and living standards are going backwards and our economy is becoming less dynamic.
There are a number of other indicators I could run off which show the Australian economy is much weaker than it should be.
Blaming this on the bushfires or the Coronavirus is either dangerously ignorant – or dangerously dishonest.
Either way, it’s not good enough.
Weak demand isn’t due to a turbulent summer – it’s been caused by years of persistently and abnormally low wages growth.
Weaker productivity growth and declining living standards didn’t begin in December – on key measures these trends date back to 2013.
And you can’t blame the fires while ignoring the costs of climate change, having been warned for years about its increasing threat to our economy, budget and financial stability.
These longstanding problems are a function of a Government in its third term and seventh year and still without an economic plan.
That’s why – here at CEDA, with a 60 year tradition of planning and providing vision – I’m saying Australia needs an economic strategy which focuses on economic growth.
And we need it as a matter of urgency.
Not growth for growth’s sake, but the right kind of growth – strong, inclusive and sustainable growth.
A growth strategy that creates good, well-paid jobs, makes inroads into unemployment and underemployment and lifts living standards.
Since taking on the role of Shadow Treasurer, one of my top priorities has been engaging business, workers, industry groups and experts on a real plan for growth.
These discussions have informed my view that any meaningful federal government growth strategy should focus on these key elements:
Taking immediate action to boost demand;
Putting in place policies to tackle the major drags on Australia’s productivity;
Managing the big forces bearing down on our economy;
Approaching the task of reform with a mindset of partnership and cooperation;
And all while recognising the importance of regional economies.
And I was pleased to read some of these themes are central to CEDA’s 2020 Economic and Political Overview.
I think Melinda’s (Cilento) comments in this year’s Overview are spot-on.
While we have achieved sustained economic growth over the past 30 years, we can’t afford to rest on our laurels.
Our challenges leave no room for dithering, or complacency.
They demand Government focused on delivering policies to support and build our economic, human, environmental and social capital.
These are the ingredients to a real growth strategy and will form the foundation of the economic policies we take to the next election.
Queensland and Townsville will be at the heart of our considerations.
Because when the regions succeed, Queensland succeeds and when Queensland succeeds, Australia succeeds.