Brian Mitchell (Lyons, Australian Labor Party) Share this | Hansard source

Well, that was an absolutely incoherent contribution from the member for Lyne, and it just goes to show the incoherence of this MPI that we face from the shadow Treasurer. As if we didn't already know, this shadow Treasurer is somebody who should never again be handed the keys to any economic portfolio—the same man who changed the law so he could keep a power price rise secret from the Australian people, and he sees fit to come into this place to lecture us about inflation. Yet where is he? The shadow Treasurer, the alternative Treasurer of this nation, can't even stay in the parliament for the MPI he has moved—a matter that he believes is so important that it should be debated in this chamber, and he can't even stay for it

Inflation started going up under the government that he was a senior minister in. In fact, the March 2022 quarter had the single highest inflation rate in Australia this century—in 23 years. So, inflation in the March quarter of 2022 was the highest in 23 years—under the Liberal government. Inflation kept going up because his government kept spending like there was no tomorrow and failed to put a lid on a pot that was boiling over.

I don't pretend that the inflation pressures affecting Australia are all the fault of the previous government. That would be as disingenuous as their suggestion, in this MPI, that inflation now is the fault of our government. Every credible economist and commentator knows and has stated that inflation is a global issue and is affecting many economies around the world. The war in Ukraine and the COVID-19 pandemic caused economic pressure to build up internationally, and here in Australia of course we've had a number of droughts and other disasters that have affected local production. When these things happen, either the pressure can be turned down, or it can bubble over. Central banks around the world have tightened monetary policy, raising interest rates, to cool their economies. When debt gets more expensive to service, then people who are holding debt, particularly mortgage holders, have less money to spend on other things, thereby reducing inflationary pressure. Indications are that 15 months after the tightening cycle started we are seeing inflation and interest rates stabilise, both here and internationally.

It has to be remembered that the Reserve Bank of Australia started putting interest rates up under the former Liberal government. The indications were clear before the election that inflation was higher than desirable and interest rates were on the march. What did the former Liberal government do in response? What decisions did the now shadow Treasurer participate in when he was a senior cabinet minister under the former government to keep inflation in check? While the pressures are global, decisions made domestically can make a difference. Did the former government rein in spending? Did they work on bringing down the national debt, which they had doubled before COVID and then tripled to nearly $1 trillion? No, they did not. The government the shadow Treasurer was a minister in kept on spending and spending, pork-barrelling its seats, shovelling public money to its mates, wasting money left, right and centre. Every dollar of it added to the debt mountain. Every dollar of it contributed to inflationary pressure and higher interest rates. Compare that to the decisions of this government since the May 2022 election.

We knew at the election that cost of living and growing inflation and interest rates would be inherited problems to deal with. Our focus has been on providing cost-of-living relief to the most vulnerable while not adding to inflationary pressures. Our assistance measures have been targeted, measured and responsible. Our economic decisions have been about making the structural decisions we need to grow the economy for the long term. We've delivered rent assistance, energy bill relief—which they voted against—cheaper child care and cheaper medicines. Our cost-of-living relief measures are expected to reduce inflation by three-quarters of a percentage point in 2023-24. Inflation will still be higher than we'd like and more persistent than ideal, but it's down from where it would have been if those opposite were still occupying the government benches. Our measures are making a meaningful difference to families around the country.

Inflation remains our No. 1 challenge, and we have a three-point plan to address it: budget restraint—delivering a $20 billion surplus, something those opposite failed to deliver—targeted cost-of-living relief, and investments to lift the capacity of the economy. The Reserve Bank governor made it clear that our measures are not adding to inflation. I don't think the budget is adding to inflation; as he said in May, it will actually reduce inflation in the next financial year.

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