Wary of unhealthy debt? He should have thought about that 10 years ago...
· NAB chairman Michael Chaney wary of ‘unhealthy’ debt
December 18, 2015 12:00am
The Daily Telegraph
OUTGOING National Australia Bank chairman Michael Chaney has urged the federal government to get the budget in the black to boost consumer and business confidence.
Mr Chaney said Australia didn’t yet have a debt problem, but people were starting to realise that in the next five to 10 years the nation would have an unhealthy 35 to 40 per cent debt-to-gross domestic product ratio.
“It’s really important for the government … next year to map out a credible return to surplus over the decade because unless you have that I think you then have a reduction in consumer and business confidence and that feeds through into lower economic activity and higher unemployment,” Mr Chaney said after NAB’s annual meeting yesterday.
Mr Chaney said the national economy was “mixed” and growing below trend, with the struggling resources state of Western Australia in the slow lane.
“The good thing is unemployment has fallen rather than risen and I think it’s evidence of real resilience in the economy that even though we’ve had this major downturn in resources, other things are coming in and taking its place,” Mr Chaney said.
He believes people will take the US Federal Reserve’s interest rate increase “in their stride” as rates slowly rise.
In his last meeting after 10 years at the helm, he brushed off a barrage of questions from climate change activists concerned about NAB’s financing of polluting industries.
NAB chief executive Andrew Thorburn said the company was well positioned for any changes in the regulatory environment.
“We believe the medium term outlook for the Australian and New Zealand economies is promising,” Mr Thorburn said.