KERRY O’BRIEN: It’s been fascinating to watch you throwing money around this year, particularly since the Budget - a bit like the proverbial drunken sailor, $50 million here and $100 million there, tens of billions of dollars in new money since the Budget, a huge weight of money that you only seem to be able to find in election years.
How do you explain that pattern over your eight years of government that you inevitably spend far more money in election years, the three election years that you’ve had as a Government, than you do in the out years?
JOHN HOWARD: Well, Kerry, all of the things that we have spent money on are justifiable policy decisions in investments and they’ve been based on the fact that - they’ve been made possible rather, by the fact that we have run a very, very strong economy, but the levels of spending are not the dominant economic issue in this election campaign.
KERRY O’BRIEN: But so many of them have fallen in election years, Mr Howard, is that mere coincidence?
JOHN HOWARD: But, Kerry, the thing that dominates everything economic in this election campaign is the threat of higher interest rates if a Labor government is elected.
KERRY O’BRIEN: But there are economists that are now saying that your spending is also going to contribute to upward pressure on interest rates?
JOHN HOWARD: Kerry, there’s a huge gulf between us and the Labor Party on interest rates for two reasons.
Firstly, look at the record, not the rhetoric, the record is that when Labor was last in government, in their last five Budgets they were in deficit.
They left with us $96 billion, $70 billion of that alone in the last five Budgets.
Added to that, of course, is the fact that their industrial relations policy will take productivity out of the equation, inevitably, wage rises will be inflationary, without productivity base, and therefore the Reserve Bank will be compelled over time to lift interest rates.
This is not a piece of fable or sophistry.
Nothing is more destabilising to family security, nothing is more threatening to family stability and security, financial security that is, than the threat of higher interest rates and that issue dominates the economic debate like no other issue and the choice between the two sides of politics, both on the basis of policy and also on the basis of performance is quite stark.