The Gillard government is failing to capitalise on a very strong international environment for Australia, the opposition says.
Responding to Wednesday's national accounts that showed the economy grew just 0.2 per cent in the September quarter, opposition treasury spokesman Joe Hockey said the government continued to shirk the hard decisions needed to restore economic growth.
The data showed public sector investment contributed 0.1 per cent to growth in the quarter.
"The small contribution from public sector investment shows that the government sector is not doing enough to invest in essential infrastructure to improve productivity and lift the speed limits to growth," Mr Hockey said.
A 1.8 per cent fall in dwelling investment and household consumption cooling to a modest 0.6 per cent growth was the impact of six interest rate rises, and additional rate increases by the banks, even before taking into account the November mortgage rate rises.
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"Labor must immediately rein in reckless spending and reduce its budget deficit to take pressure off interest rates," Mr Hockey said.
Government efforts to lift productivity were also a "dismal failure". Productivity fell by 0.8 per cent in the quarter and 0.8 per cent over the year.
"This is an area which requires urgent policy attention and reinforces the critical nature of the strong productivity agenda which the Coalition took to the election," Mr Hockey said.
