Throughout my time in public life I've always been driven by equality, fairness and opportunity for all. They are principles that were fused into me long before I went into parliament, principally when I had the honour of working for the great Mick Young. Mick was a deep source of inspiration in the way he championed those ideals, with a huge passion for education as a core driver behind all of these Labor values. So I was proud to have the opportunity to celebrate his memory and his legacy again on Friday night at the annual Mick Young Scholarship dinner. Mick believed so enthusiastically in the transformative power of education, and the many scholarships given in his name have made a better education a reality for thousands of young Australians born without the opportunities that flow to others.
Mick instinctively understood that a prosperous, growing economy was fundamental to spreading opportunity. Against the backdrop of the worst global economic conditions in 80 years, supporting jobs and growth has always been front and centre of everything this government has stood for. Our actions at the height of the crisis not only meant we avoided recession, but they have provided a sturdy foundation for growth, investment and job creation in recent years and for years to come.
Contrary to suggestions in some quarters, this week's capital expenditure data confirmed the bright outlook for mining investment, which is set to stay at very high levels for some time yet. Not only did capital expenditure in mining reach a new record high in the December quarter, but early estimates indicate that investment is set to rise further in 2013-14. After adjusting for historical spending patterns, total capital expenditure is expected to reach a record $187 billion in 2013-14, including $105 billion for the mining sector and over $63 billion in 'other' industries – which includes all industries except mining and manufacturing. As firms typically revise how much they intend to spend over time, this adjustment is made using a five-year historical average of how expectations have evolved. If achieved, this early estimate for 'other' industries would be the highest on record. But while there are encouraging early signs that investment intentions have lifted in some service industries, they remain subdued in other parts of the non-mining economy, with the sustained high dollar still working against the impact of lower interest rates.
The fact that the mining investment boom still has some way to run means that the rest of the economy has time to rebalance over the next year or so. I've said before that the transition from mining to non-mining drivers of growth may not be seamless, but as a nation we've handled big transitions well in the past. We're also starting this transition from a strong base with resilient fundamentals and an economy 13 per cent larger than it was before the government came to office. This Wednesday we receive the December quarter National Accounts, which will provide an official snapshot of our economy performed in the final months of 2012. Last year was a difficult year for the global economy, and we already know that the majority of major advanced economies contracted in the quarter. Whatever the result next week, we should remember that our economic fundamentals are resilient. In addition to a large investment pipeline and solid growth, we have low unemployment, low interest rates, and contained inflation.
The Reserve Bank will meet on Tuesday for its monthly interest rate decision. The RBA takes its decisions independently, but the Government is playing its part through our continued fiscal discipline which is helping to keep inflation contained. Since mid-2009 we have offset every single dollar of new expenditure, including every announcement in the last election campaign. Our budgeting has been careful and responsible. It has meant we have achieved fiscal discipline while making room for our Labor priorities, such as the National Disability Insurance Scheme and the Gonski education reforms which we will fund in this May's Budget.
We've already seen a succession of interest rate cuts over the past year or so - reducing the cash rate to just three per cent. It's really pleasing to see lower interest rates are already providing support for families, who I know can find it tough to make ends meet. A family with a $300,000 mortgage is now paying around $5,000 less per year in mortgage repayments than when we came to office. This translates to about $100 back in their pockets each week. It is great that hard working families are able to see direct cost of living support as a consequence of the government's tight fiscal ship. The following table gives a sense of just how substantial these savings have been to mortgage holders since we came to office:
Mick Young was always looking over the horizon, ardently focussing on reforms to secure the future of our great nation for those who come after us. That's the spirit in which this government approaches the Gonski school improvement education reforms that were recommended to us last year by an independent expert panel. In a competitive world, we defiantly believe these reforms will be right at the core of what will drive Australian prosperity and jobs in this the Asian Century. So they sit right at the core of our vision for Australia's future. They are also an expression of our egalitarian values, and our belief that a world class education should be the right of every Australian child, no matter how well off their family, or what postcode they live in.
As part of our roadmap for success in the Asian Century, we want to lift Australian schools into the world's top five by 2025. Our National Plan for School Improvement is the first step in that journey. It is absolutely essential that the Gonski reforms are implemented so that our schools of the future will be among the world's best. Despite the success of our economy, our future success is not assured. Landing these big education reforms is critical to our future prosperity.
I'm firmly of the view that for Australia, the glass is more than half full. Sure, like any time in our history we face challenges. But make no mistake, we approach our challenges from a position that almost any other country would trade for. I'm confident that by retaining our strong sense of optimism, and our reform ambition, we can build a prosperous economy and country strengthened by the values and ideals that Mick Young fought for so persuasively all his life.
Deputy Prime Minister and Treasurer of Australia