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Malcolm’s achievements as PM are better than you think

My Sky News and 2GB colleague, Andrew Bolt keeps asking political pundits what Malcolm Turnbull has achieved in 12 months and over the past week none of his guests have come up with anything.

Maybe he’s asking the wrong people or maybe Malcolm has been a non-deliverer.

Look who’s talking

So far he’s asked Peta Credlin – Tony Abbott’s ex-adviser – who many think was not helpful to the former PM, once he got the top job. Peta couldn’t come up with a positive for Malcolm.

Then Jeff Kennett, who said he wanted Malcolm to succeed, unlike Andrew, who is a raging Abbott fan, also couldn’t come up with anything to credit Malcolm’s showing so far.

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By the way, I know how much economics Jeff knows as I used to be his business commentator when he turned to radio after being the Victorian Premier, and economics is not his long suit. He’s good at politics but not economics.

On his own admission, Andrew is not trained in economics and he tends to rely on doomsday merchant economics commentators, which I guess would not surprise many people.

Some points for Malcolm’s scorecard

And this is my point – one of Malcolm’s biggest achievements has been the fact that since he’s taken over he hasn’t stopped the economy improving!

This week has been good for the economy, so let me give you what you might have missed:

  • Economy-wide, sales rose by 0.6% in the June quarter. Sales are up 3.5% over the year – the biggest annual gain in 7½ years. (Great news!)

  • Company operating profits rose by 6.9% in the June quarter to be broadly unchanged over the year. (Good solid news but not great, yet!)

  • Job advertisements rose by 1.8% in August to 4-year highs. Job ads are up 8% on a year ago. (That’s gotta be great news!)

  • New car sales were up 4.6% in August to create a record for the year of 1,178,348 new sales. (More great news!)

  • The Australian economy has just completed 25 consecutive years of economic growth. The last recession ended in June 1991.

  • Growth in the June quarter was 0.5% taking annual growth to 3.3%.

  • The RBA would add March’s growth and June’s together which would be 1.5% and then multiply it by two to annualise six months of growth and that would be 3%, which is a great number. The US is growing at less than 2% and closer to 1%!

  • Fourteen of the 19 industry sectors expanded in the June quarter, which means only five sectors are struggling.

  • Our trade deficit narrowed from $3.25 billion in June to $2.41 billion in July. It was the 28th consecutive monthly deficit. The rolling 12-month deficit improved from $36.898 billion to $34.974 billion, which is the smallest deficit in eight months.

Economics-wise, growth has returned to over 3%, unemployment has fallen from 6.2% under Tony to 5.7% under Malcolm and interest rates are 0.5% cheaper for borrowers.

Meanwhile, business confidence, according to NAB, went from 1 to 4 but it has been as high as 6!

But wait, there’s more!

Over the same time, consumer confidence went from 93.9 (where pessimists outnumbered optimists) to 101 (where optimists were on top!).

And last week saw plans to invest by businesses for 2016-17 have increased three quarters in a row, which has even surprised many economists.

Dividends to shareholders

I remain positive on the Oz economy and I loved this from CommSec’s Craig James: “In late August, dividends started flowing to shareholders from those companies that reported early in the recent earnings season. Conservatively around $24 billion (or around 1.5 per cent of GDP) will be paid out by companies over the next few months.”

What ‘income recession’?

That has to help the economy and another area where whingers have been bellyaching about has been the so-called income recession. There were some quarters where economic growth was good but National Income was falling and because it happened over two quarters or more the pessimists whined about an income recession, despite a lot of it came from a shrinking mining sector that employs only a small chunk of the workforce.

Well income is on the rise again.

Real gross national income rose by 0.6% in the June quarter to be up 2.5% on the year. In nominal terms GDP lifted 1.3% in the quarter and rose by 3.4% over the year.

Economic wins trump the political wins

Malcolm’s political wins have been few but the economy has picked up under his leadership. Some of it came from the last Joe Hockey Budget but some of this economic improvement has been the confidence lifts from business and the consumer.

I regularly quote Bill Clinton but it’s relevant for political experts who are economic nincompoops – “it’s the economy, stupid!”

Peter Switzer is the founder of the Switzer Super Report, a newsletter and website for self-managed super funds.

www.switzersuperreport.com.au