By JR on Thursday, June 07, 2012
A boom that they are still trying their best to block. But the mine employees are now clearly spending the very high wages they earn. And some spending generally will have been brought forward to beat the onset of the carbon tax
GLOATING over a "stunning set of numbers", Treasurer Wayne Swan yesterday said Australians should have a "bounce in their step".
March national accounts showed households had driven the country to record economic growth of 1.3 per cent for the first quarter - double the forecast and the strongest in five years.
The numbers pointed to annual growth of 4.3 per cent - normally considered an overheating economy - and left economists bewildered. Even the Treasurer's Office asked they be double checked.
"They are proof that something special is happening in our country," Mr Swan said.
But retailers and business groups expressed horror at the Treasurer's claim that it was a "great day for Australia", saying few people outside the mining sector were likely to share his enthusiasm - particularly with the carbon tax due to start within four weeks.
"We're having a horrible time in retail ... there's certainly no bounce in our step," Harvey Norman boss Gerry Harvey said.
Australian Chamber of Commerce and Industry boss Greg Evans said the figures did not reflect most people's experience: "Most parts of the economy including retail, hospitality, manufacturing, construction and tourism are all still finding it so tough."
Aussie Home Loans founder John Symond said there was a long way to go before the Treasurer could make such claims: "The lack of confidence has been horrendous. There's been this build-up of uncertainty and the carbon tax plays a big part. "We're nowhere near the bounce Mr Swan believes. I think he's beating his chest."
In the city yesterday, shoppers might have been jumping over puddles to get to the sales but few thought the economy was doing so well that they had a bounce in their step.
Lizanne Kohler, Ottilie Wouters and Juliette Cleton agreed the Australian economy was in good shape but thought their "bounce" was thanks to the bargains, and not Wayne Swan.
"There have been a lot of sales - and that's good for us," Ms Wouters said. Ms Cleton said she had a budget for discretionary spending and would not break it.
The ABS figures revealed the primary driver of the growth spurt was household consumption, which made up 0.9 per cent, followed by private business investment.
"What a stunning set of figures," Mr Swan said. "I think these figures send the loudest possible message to the world that Australia is the strongest performing developed economy, bar none."'
The figures ran counter to the Reserve Bank's decision to drop interest rates by 0.25 points only a day earlier on the basis of only "modest" growth and fears of deteriorating global economic conditions.
Opposition spokesman Joe Hockey said: "Imagine how well our country could do if we had a good government?"
Prime Minister Julia Gillard said the figures proved "doomsayers" wrong.
Australian National Retailers Association chief executive, Margy Osmond said: "I think across the sector there are pockets of good news but ... it'd be very, very rash to suggest a bounce."