Jim Chalmers (Rankin, Australian Labor Party, Treasurer) Share this | Hansard source

Thanks to the member for Bruce for asking that question with characteristic panache and class. The budget we handed down nearly two weeks ago was overwhelmingly influenced by the inflation challenge, and it was primarily a response to that challenge. It had to be an inflation focused budget because inflation is the No. 1 challenge facing our economy, right now, just as it is for economies right around the world. That meant that the budget had to deliver cost-of-living relief, it had to invest in the drivers of the economy and it had to start cleaning up the mess that was left to us from the wasted decade, and it had to do all of those things without adding to inflation. That's exactly what our first budget delivered by providing targeted cost-of-living relief in areas like cheaper early childhood education and cheaper medicines; by investing in the capabilities of our people and the capacity of our economy with fee-free TAFE and more university places; with the National Reconstruction Fund and our Powering Australia plan; and, most importantly of all, when it comes to this inflation challenge, keeping spending under control and finding responsible savings in the budget.

This responsible approach to the budget marks a total change from what we got from those opposite over the previous nine years. In our budget, there is an average 0.3 per cent annual real spending growth over the forward estimates compared to an average of 2.6 per cent a year in their budgets—and that was before the pandemic. More than 90 per cent of tax revenue upgrades are returned to the bottom line in our budget, compared to 40 per cent by the previous government. There is $22 billion of savings in our budget, but not a single cent of savings on the expenditure side in the March budget handed down by those opposite. We knew we had to act differently from our predecessors. We knew we had to be more responsible, and, because we did that, this budget doesn't make our inflation problem worse. In fact, if we had done what they did and spend all of the revenue upgrades—on 14 occasions they spent every cent of the revenue upgrades—that would have added another half a percentage point to inflation over the next year and interest rates would have to go even higher as a consequence.

So the budget was right and responsible. It was defined by the times and it was designed for the times. It will help steer us through the difficult days that are ahead of us so that we can build an economy that does get wages moving again after a wasted decade of wage stagnation. It will deal with the aged-care crisis that we inherited, the energy policy chaos that we inherited and the labour shortages that we inherited, and it will begin to deal with the trillion dollars of debt that those opposite left behind with almost nothing to show for it.

See this speech in context