EMPLOYMENT FIGURES

Mr MARSHALL (Norwood—Leader of the Opposition) (14:37): My question is again to the Premier. Why has South Australian unemployment increased by 30 per cent under Premier Weatherill?

The Hon. J.W. WEATHERILL (Cheltenham—Premier, Treasurer, Minister for State Development, Minister for the Public Sector, Minister for the Arts) (14:37): I think I've addressed this question at length before. I am more than happy to traverse some of the factors that are bearing on the South Australian economy, perhaps beginning with the international forces that come through a high Australian dollar.

It has moderated recently but, over much of the period that we've been discussing—the period of the last few years—we've had a very high Australian dollar, and the South Australian economy is particularly focused on manufacturing, where you have one of the largest proportions of manufacturing within the South Australian economy. That has, of course, affected our trade exposed sectors by changing relative prices in a way which makes imports cheaper, and then the import competing businesses find that difficult. Exporters, of course, also find it difficult, and that's had a very substantial bearing.

Of course, probably the single most important issue is the loss of confidence that's occurred in Australian investors, and South Australian investors in particular, as a consequence of global financial conditions and the way in which they have affected asset values, whether it be superannuation accounts or their housing accounts. So, people are looking at the valuations of their houses.

They are seeing that they are not going up or, in some cases, are going down. They are looking at their superannuation accounts and seeing negative numbers instead of positive numbers. Thankfully, all that's changing in the most recent set of numbers but, over the last year or so, that's what they were seeing. So, correspondingly, what you have seen is a massive increase in the savings ratio as people deleverage—that is, pay down their debt—or save, because they are worried about the future.

When people are worried about the future, they stop spending. When they stop spending, retail figures go down. Also, they stop making the largest purchase of their life, which is their home. We've seen a very substantial fall in housing construction activity, which is a very substantial proportion of the South Australian economy.

As difficult as this has been, the South Australian economy has been resilient during this period. It has continued, albeit slowly, to show signs of growth. We know in the most recent data there are very strong prospects that the next financial year will be much stronger than the last financial year. The question in politics is not so much standing up and actually describing what is; it is actually describing what you are going to change to make it better, and on that mark, those opposite fail miserably.

Members interjecting:

The SPEAKER: Well, of course the last bit was out of order.