Swan urges optimism on economic outlook

19 Feb 2012, 6:20 pm   -   Source: AAP

Treasurer Wayne Swan says Australians should remain optimistic about the economic outlook despite recent reports of job cuts at several major companies.

Treasurer Wayne Swan says Australians should remain optimistic about the nation's economic outlook despite recent reports of job cuts at several major companies.

Official data on Thursday showed 46,300 jobs, of which most were part-time, were created in January with the unemployment rate dropping to a six-month low of 5.1 per cent.

"It's a fantastic achievement for our nation, particularly given the current state of the global economy," Mr Swan said in his weekly economic note on Sunday.

He said unfortunately reports of staff cuts at several large companies overshadowed the impressive data.

ANZ Bank has said it would cut 1000 staff and airline Qantas reported it would lay off 500 workers, with as many as 2000 to come.

"Of course we shouldn't view the world through rose-coloured glasses, but we need to recognise the economy's strong foundations if we are to make the most of our nation's opportunities," Mr Swan said.

This point was made by Treasury Secretary Martin Parkinson to a Senate estimates hearing on Friday.

"It's almost as if most Australians tend to think we live in Greece. We don't," Dr Parkinson said.

"We actually have an incredibly bright future in front of us."

Mr Swan said the high Australian dollar, uncertainty about the global economy and economic structural changes in Australia had put pressure on many local businesses and workers.

But a low jobless rate, solid economic growth, massive investment in the nation's resources sectors and low public debt placed Australia in a position of strength.

"Our strong standing was highlighted during the week when Moody's downgraded a number of European nations, leaving Australia as now one of only eight countries to hold the gold-plated AAA credit rating with a stable outlook from all three international ratings agencies," he said.

Mr Swan said the passage of the government's private health insurance rebate through the House of Representatives last week was a step towards sustainable and targeted spending on healthcare where it was most needed.

Under the changes, the rebate will be means tested for individuals earning more than $83,000 a year and families earning more than $166,000 from July 1.

The rebate would cut out completely for singles who earned more than $129,000 a year and families earning more than $258,000.

"It's simply not fair for low and middle-income Australians to continue to subsidise the health insurance of households with incomes of more than a quarter of a million dollars a year."

Mr Swan said the rebate was the fastest growing cost to the health budget.

"This change will save taxpayers $2.4 billion over the next years," he said.

"This makes our investments in hospitals and health care - like more beds, better services and shorter waiting times - more affordable."

The treasurer will depart on Friday to attend the Group of 20 Nations meeting for finance ministers and central bank governors on February 25-26 in Mexico City.

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