Thank you very much Mark [Kenny] for that introduction.
Thank you to the National Press Club for the invitation to be here my first time as Finance Minister.
Can I acknowledge the Parliamentary colleagues present and also the Secretary of my Department, David Tune.
It's particularly good to be asked to speak on the economy; and we are serious about having this debate Mark.
Because making the right economic choices, for today and beyond, is the core business of government.
Making the right choices to support jobs, to enable growth, to build a better future; these are the imperatives which underpinned this Governments response to the Global Financial Crisis.
And the choices made then were the right ones, ensuring 200,000 Australians stayed in work.
Together, we've come through the worst global downturn since the Great Depression, in one of the strongest positions of any advanced economy.
But we also know that the task of securing the nation's economic strength is ongoing.
Most Australians are aware of the risks in the global economy today.
And all of us know that we live in a period of great change.
So, rightly, this will be a year when the economy is front and centre.
And, if we are serious about making the right choices again, then the debate about those choices needs to be one of substance.
Because economic strength cannot be secured by slogans and stunts, and it cannot be built on negativity.
You cannot build the nation's future by saying No.
A snazzy sound bite or photo opportunity might grab your attention for a moment, but now, more than ever, the nation needs its leaders to focus on the long term.
Consider some of the changes we face:

• the current crisis in Europe;
• the rise of the Asian economies;
• the transformation of the global economy; and,
• the changes in our own economy, driven by the high dollar.

How Australia fares in the face of these changes; what opportunities we create, are matters in our hands.
As the Prime Minister said, we believe that our nation is strong enough to bend those transformations to our own advantage.
But to make the right choices, we have to be prepared to meet change, not deny it.
We have to be willing to look ahead.
And we have to be willing to reform.
Security and opportunity are not furthered by standing still.
For Labor - for this Government - 2012 will see us continue to deliver for all Australians.
For this generation, and those that follow.
Put simply, this Government believes in keeping people in jobs and supporting growth.
We believe in securing opportunity and prosperity through spreading the benefits of the mining boom to all Australians.
And, in a changing economy, we want to give all Australians the tools to participate.
Against this backdrop of change, some will want to cast reform as something to be feared.
They will throw back to the past, to side step the realities of the future and to avoid necessary reform.
But the world is moving fast. And if were not prepared, it will move past us.
At a time when looking ahead could not be more important, todays narrowing of the debate and the habitual negativity of some has the potential to halt the reform prerogative which has underpinned Australias past success.
And the challenges that face Australia today and in the future require a coherent and considered approach; informed by good policy and the reality of change.
And remember, we have achieved this before.
The reforms of the 1980s deregulation of markets, lowering of tariffs and the floating of the dollar all occurred in a mature policy environment.
Politicians saw the long term benefits of preparing the Australian economy for the decades of globalisation to follow.
And we need to do the same today.
And like the public of the 1980s, Australians today deserve a serious debate.
They want to hear actual policy, not just catchphrases.
As politicians, our responsibility to the future of the country demands our participation in such a debate.
Because the decisions governments take today and in the coming years will shape outcomes for working families for decades to come.

We are living through a global economic realignment, as growth shifts from western economies to our region.
The day-to-day market volatility stemming from news in Europe and the US, only serves to highlight these broader trends.
With the Euro zone estimated to contract this year, and US growth below trend, it will be the Asian region our region that will drive global output.
But at the beginning of the Asian Century, we cant assume that opportunities will come automatically.
We cannot rely solely on geographical advantage.
At the crossroads of such change, politicians are faced with a choice.
They can face change, or they can turn their backs.
The Gillard Government knows we need to prepare so that we can take advantage; so that opportunities in our region can be realised.
We know that change cannot be avoided.
A politician that denies change is doing a disservice to their constituency.
Because leadership in times of change requires the right choices; equipping the country to take advantage of the new opportunities that will arise.
And Labor governments have always taken this approach.
Where conservatives look to the past for understanding and guidance, we position the country for the future.
This is an approach all the more pertinent today, as one of the key economic challenges over the coming years is the speed of change.
Accelerated by technological transformation, the composition of our economy is changing quickly.
Gone is the time when economic adjustments might span one or more generations.
It is the responsibility of governments to manage this transition.
And we do this best by backing our people.
By equipping Australians for the challenges ahead.
By ensuring all Australians have the skills, the knowledge and the capabilities to participate in the new economy.

For a Labor Government, our vision for a strong economy is driven by our Labor values.
We unashamedly support jobs and growth. We are delivering the policies required to provide all Australians with the capacity to participate.
The same approach as we took through the GFC, and these same values will guide how we position Australia to prosper in the Asian Century.
Our Labor Government has a proven record as responsible economic managers.
We have made the right fiscal decisions, and we have made the right policy decisions.
We charted the course through the GFC and avoided recession, unlike virtually all other advanced economies.
And most importantly, our swift action avoided the corrosive effect of hundreds of thousands of working Australians losing their jobs.
While the effects of the Global Financial Crisis still linger, and global instability continues to affect us, Australia is in a position of strength.
Underpinned by a strict fiscal strategy, we are determined to return the budget to surplus in 2012-13 after the damage to budget revenues caused by the GFC.
This damage was wrought by a $140 billion revenue write-down over five years.
And despite attempts to mount a dishonest scare campaign, any serious commentator knows our debt is very modest compared to our capacity to repay.
Our net debt is expected to peak in 2011-12 at 8.9 per cent of GDP less than one tenth of the average of the major advanced economies in 2016.
And the strength of our position is widely recognised, including by international institutions such as the IMF, and ratings agencies.
Just look at the headline indicators:

• Growth at around trend this year well above what is expected of major advanced economies.
• Over 700,000 jobs created under this Government.
• Unemployment at 5.2 per cent, compared to 10.4 per cent in the Euro zone at the end of 2011.

These indicators are a reflection of the resilience of our economy, but also the disciplined economic management of this Government.
We understand that markets punish those who dont demonstrate sound budget discipline.
We see that every morning when we look at overnight developments in European markets.
Instead, Australias strength has been recognised.
One of just 12 countries who have AAA ratings from all three ratings agencies.
A signal to business that they can invest in Australia with confidence.
Its this confidence that is encouraging businesses to expand and grow.
Its this confidence that is coming under daily attack from the Opposition, as they trash the economy and talk down Australias strengths.

Through good economic management the Government has been able to implement a number of reforms to strengthen the economy, and also to promote values of equity, fairness and participation.
We have made the tough choices to deliver for ordinary Australians and their families, now but also into the future.
We have introduced the MRRT, the Minerals Resource Rent Tax, to spread the wealth of our mineral resources to all Australians through small business tax cuts and increased superannuation for working people.
We have introduced reforms for the patchwork economy, to give businesses across Australia a leg up.
We have delivered on climate change introducing a price on carbon to drive innovation and to lower emissions.
Our Clean Energy package supports families and pensioners through additional payments and through tax cuts.
We are making record investments in productive infrastructure, including some $18 billion in urban rail and road infrastructure.
In fact, we have invested more in urban rail since coming to Government in 2007, than all previous governments since Federation.
And in the last Budget, we announced our investment of over $3 billion in skills and training.
We are investing in these priorities so we can capitalise on the Asian Century tomorrow.
We are determined to give all Australians the tools for the new economy.
So, these Labor reforms will see Australia prosper into the future as a low carbon and high skilled economy.
Through managing a strong budget, we have also been able to foster a stronger community, reflecting Labors commitment to fairness and decency.
We have delivered Australias first ever Paid Parental Leave scheme, increased the Child Care Rebate, introduced the Education Tax Refund and we have delivered the biggest ever increase in the age pension.
We will fund our share of the historic pay-equity claim for social and community workers and we have made record investments in schools and hospitals.
And this Government has taken the first steps towards a National Disability Insurance Scheme.
And theres more work to be done.

If the 21st century is going to be the Asian Century, then it can also be the Australian Century.
This is how Australia has historically prospered over the years by looking at where opportunities lie in the global context, and positioning ourselves to take advantage of them.
But it wont happen automatically.
We have to ensure that the economic challenges of the coming decades are met by an able, highly educated and trained workforce.
When our opponents talk of labour flexibility they are looking to lower wages and conditions.
Labor looks to adaptability and to economic inclusion.
Participation in the economy is central to our economic agenda.
And we have delivered.
An additional 100,000 students are now attending university, with places uncapped from this year forward.
And 93,000 trade apprenticeships commenced in the last twelve months.
Last week, the Prime Minister announced a HECS-style loans scheme to remove barriers to Australians seeking training and qualifications in our nations TAFEs.
These reforms build on our investments in early childhood, primary and secondary school because we know that a good working career starts that early.
Our investments in human capital are matched by physical infrastructure.
We understand that you cant have a 21^st century economy, with 19^th century technology.
The National Broadband Network will connect and transform the output of the next generation of Australian workers.
In a high value economy, connectivity will underpin business and it will underpin education.
It will provide the backbone of a modern, high skill, high productivity economy.
So under our Government, Australia is entering the Asian Century with a clear vision.
 
To take advantage of these opportunities, we need leaders of substance.
Leaders prepared to engage with difficult problems.
Prepared to challenge their own prejudices and predetermined views.
Leaders who see an opportunity for a cheap shot, but dont take it.
Leaders who see their role as lifting the debate and not dragging it down.
Last week, Mr Abbott delivered a speech better defined by what was left unsaid, than what was said.
A speech that threw back to the past, rather than projecting a vision for the future.
A speech ignorant of the change occurring in our economy and in our region.
And a speech devoid of policies to manage the economy through that transition.
Serious political leadership requires an understanding of the economic environment, a positive policy platform, and the fiscal credibility to deliver.
And on all points, Tony Abbott failed.
Instead, we heard a vision mired in negativity.
Lets recall what would be the first actions of an Abbott government:

• Reversing income tax cuts for families
• Higher taxes for small business
• Tax breaks for big mining companies
• Lower pensions
• Lower superannuation for working Australians.

These are a strange set of priorities.
There is no doubt Mr Abbott is at his most effective when he is being destructive.
But attack lines never compensate for the absence of policy; and they will never make a positive change in Australians lives.
The truth is, when it comes to improving the lives of all Australians not just wealthy miners the Opposition are at a loss.
They are stringing us all along.
A half promise here, an aspiration there, and an arrogant assumption that theyre not required to do anything more.
 
Mr Abbott has previously admitted he isn't particularly interested in economics and the views of economists.
That the changes occurring in our region and our economy were ignored in his vision last week, confirms this lack of interest.
Glib comments like it will be a surplus thats made in China demonstrate his blinkered view of Australias position in Asia.
What ignorance. What ignorance of the depth and breadth of our trade and economic links. What ignorance of the opportunities these present for all Australians.
The risk is that this small mindedness could limit the opportunities for Australians.
It has always taken Labor Governments to open Australias eyes to our region.
To recognise and take advantage of our geography.
We are uniquely positioned and we should never forget that.
But one gets the sense that an Abbott government would still see Australia as the quarry of Asia, and little more.
This Liberal leader fails to grasp that Australias economic future is tied to our region.
Our Prime Minister in the footsteps of previous Labor Prime Ministers sees opportunity for Australia in our region, and is working to ensure that our economy is best placed to benefit from the changes ahead.
 
Of course, the Opposition and the Government will disagree on fiscal priorities and that is as it should be.
But the debate needs to be credible.
The public have a right to know what each sides priorities are, and have confidence in their capacity to deliver.
Lets have a look at the track record of the Oppositions economic team, from Mr Abbott down.
We had the debacle of a Budget reply speech where Mr Abbott hand passed to Mr Hockey, who then hand passed to Andrew Robb.
They double counted saves in their response to the flood recovery.
We had the $10.6 billion election costings black hole, with their costings supported by a dodgy audit.
And the latest turn has been the Shadow Immigration Minister using a catering company to put together costings.
This is the team that cant nail simple arithmetic, yet they want to be in charge of the nations economy.
And, despite these failures, despite their incapacity to prioritise, they are still running up the tab.
Tony Abbott said last week he aspires to include dental care in Medicare at the cost of up to $4 billion per year.
Something he never did in Government as Health Minister when he might have had to have found the money.
The Liberals have said theyll support the increase in the superannuation guarantee, at the same time theyve said theyll repeal the minerals tax that funds it a cost to the budget of over $700 million.
And the cost of the Liberals promised tax cuts remains unknown and so far unfunded and recall that John Howards sandwich and milkshake tax cuts cost over $10 billion.
Clearly, these aspirations have been floated, safe in the knowledge that they dont have to be reflected in the budget forward estimates.
But in the end it is just reckless.
They cant even work out if they can commit to tax cuts.
In the week since Mr Abbott stood at this lectern, the Liberal partys commitment has gone from:

• Tax cuts in the first term will be in prospect
• To we will have tax cuts in our first term
• To we will aim for tax cuts in our first term.

Well, after one week, I doubt anyone in the public is clear of the Oppositions commitment.
And this from a party touting themselves as the next Government.
It is emblematic of the approach the Opposition has taken to policy, to the budget and to the economy.
And we know why.
Because at the heart of their economic credibility is on their own numbers a $70 billion black hole.
Just to get to the starting line they need to find $70 billion in savings.
Now, as a member of the Expenditure Review Committee I can tell you that this amount of savings will only be found through savage cuts to services.
$70 billion is the equivalent of cutting Medicare payments for four years, or halting all age pensions for two years.
So, Joe can go on about cuts to the public service as much as he likes, but this is a fraction of the funding he needs to find.
The maths is simple.
And it seems that this arithmetic is finally and slowly dawning on the Opposition.
Because, not twelve months ago, Joe Hockey was claiming the Liberals would be in surplus earlier than the Government.
Then it became the surplus in the same year as the Government.
Then, on Monday, Andrew Robb the man tasked to make their numbers add up backed away from achieving a surplus at all.
He couldnt even commit to a surplus by 2017.
Just this morning, Opposition Leader Tony Abbott walked away from a surplus as well, saying theyll get back to surplus as quickly as possible.
Gone is the chest thumping and bravado of the Shadow Treasurer from just twelve months ago.
For an economic team constantly harking back to the previous Government to gain credibility, one cant help ask what does Peter Costello really think of this lot?
The Liberal party has been dining out on the record of the Howard Government for a very simple reason.
They have nothing else to point to.
No real policies.
No real costings.
No real savings.
No real budget bottom line.
No real leadership.

The Oppositions economic efforts would be amusing if the jobs they aspire to were not so important.
Their inability to grasp the challenges and opportunities before us would be lazy, if the costs of failure were not so high.
As elected representatives in these tough economic times, I believe the choice is clear.
We could choose to go down the path of negativity.
A path where we talk down the economy; offer hollow promises; where we stubbornly miss out on opportunities for our economy to grow.
Or we can take the path of optimism.
Of leadership.
The positive path; where we embrace the rise of the Asian economies and make the most of the unique opportunity this presents; where we put in place policies that will see this nation through, not just to the next election, but to the next generation.
Where we work to benefit all Australians and share the wealth of the mining boom.
Thats what our constituents elected us to do.
Thats what this Government is about.
Thank you.