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April 19th, 2012 
FAKE NEWS for the Zionist agenda Prime Minister Julia Gillard says changes to the official cash rate ultimately lie in the hands of the independent central bank but the government can put the right policy settings in place to it give room to move.
Opposition Leader Tony Abbott on Thursday seized on her comments, saying in linking an upcoming surplus in 2012/13 to lower interest rates she was admitting to the Labor government’s past failures.
Ms Gillard told a business lunch in Perth on Thursday the projected surplus is not a political target but a “potent economic tool”.
“It’s time to get back in the black,” she told the Chamber of Minerals and Energy of Western Australia and Western Australian Chamber of Commerce and Industry.
“Surplus is right now. When our own economy here at home is returning towards trend growth, with low unemployment and a huge investment pipeline.”
A promised surplus would give the Reserve Bank of Australia (RBA) room to make a cut to its cash rate if it considered it appropriate.
But Mr Abbott noted Labor had delivered the four largest budget deficits in Australia’s history since winning government from the coalition in late 2007.
“The prime minister has admitted that her economic policy for the last four years has been a failure,” he told reporters on the Gold Coast.
“There has been upward pressure on your mortgage rate for four years.”
Liberal senator Arthur Sinodinos said the government was creating an atmosphere of political pressure to force the RBA to cut the rate “faster and harder” than it might want otherwise.
“They shouldn’t be conned by the prime minister into thinking that she is going to deliver such a razzle dazzle budget until they’ve actually seen it,” Senator Sinodinos told ABC Radio.
The RBA board next meets on May 1, a week before Treasurer Wayne Swan hands down his fifth budget.
But Ms Gillard said any decision about the cash rate was in the hands of the “independent” RBA and it would exercise “its best judgment”.
Financial markets are pricing in a 90 per cent chance of a cut in the cash rate to 4.0 per cent from 4.25 per cent in May.
Mr Abbott said the coalition had been calling for a surplus for years.
“That is in the DNA of the coalition,” he said, adding taxes always would be lower and the fiscal position always better.
“In the marrow of our bones is the conviction that government has got to live within its means.”
Ms Gillard said her government had funded new spending from savings since mid-2009, showing the ability to “get big things done”, while managing the budget “prudently”.
Australian Greens leader Christine Milne said even though the government had backed itself into a corner in having to fulfil a promised surplus, it should not be putting pressure on the central bank.
Senator Milne said making the spending cuts necessary to return the budget to surplus would result in job losses.
“The Greens have said all along that we think it would be great if interest rates were cut but this is a decision for the RBA,” she told reporters in Sydney.
Ms Gillard refused to discuss potential budget changes during questioning from reporters in a Perth childcare centre.
“Sorry about that. They’d be kids here who’d like to get their birthday presents early too, but it doesn’t work like that.”
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