Scott Morrison says he does not want to wait for a recession to convince parliament of the need for his company tax cuts.
He has referred to Paul Keating’s infamous phrase from 1990 about the “recession we had to have”, saying he would prefer important policy changes were accepted before an emergency.
“I don’t wish for a burning platform,” he told ABC radio on Thursday. “I would certainly hope that it wouldn’t be necessary for that sort of terrible result to spur the parliament and others into accepting the important changes that we need.”
Australia’s economy slipped backwards in the September quarter by a greater than expected 0.5%, according to the Bureau of Statistics. It was the first time in five years the economy had recorded three months of negative growth.
When the economy previously contracted in a single quarter, in March 2011 (by 0.2%), it had suffered from the Queensland flood but the September quarter contraction had no natural disaster affecting it.
Economists said the contraction was a direct consequence of the federal election, heavier than normal rains and a significant drop in government spending but they also said the economy was suffering a broader weakness.
The shadow treasurer, Chris Bowen, said the quarterly contraction – which was the second-worst result in 25 years, better only than the 0.7% contraction in the December quarter in 2008 during the global financial crisis – was on the Turnbull government’s head.
“Malcolm Turnbull wasn’t interested in the real story in 2009 when he was leader of the opposition and there was a negative quarter,” Bowen said. “He said that was a result of government actions, he condemned the then government for not having an economic strategy.
“Annual growth has [now] fallen from a revised 3.1% to 1.8%. This is not jobs and growth. Now all the government has is a slogan.”
Morrison, only the third treasurer to reside over a negative quarter of growth since June 1991, said on Thursday that he didn’t take growth for granted.
He attacked Labor for arguing that the government ought to reduce the backpacker tax rate so it matched the tax rate in New Zealand but then refusing to cut the corporate tax rate so it was similar to corporate tax rates overseas.
“They think businesses should pay a higher rate of tax in Australia,” he said. “Labor’s argument is nonsense.
“I am focused on how I get businesses to be able to invest more in their businesses, attract capital. That is done through a competitive tax rate for businesses and it is done through the program we have on infrastructure investment.
“That is the outcome we need. That is why we need to get it done.”
