Aaron Violi (Casey, Liberal Party) | Hansard source

No word about Putin at all, Member for Fisher! She won't say it because she can't, and I understand and respect that, but you see $209 billion of spending and $45 billion in off-budget spending—that drives a lot of demand and a lot of homegrown demand. We can join the dots there on the RBA governor's words.

She also said:

While labour costs are a big part of the increase, huge increases in the cost of energy, rent, and insurance are all keeping inflation higher for longer. In the September inflation report, energy (utilities) prices increased more than 12% year-on-year and insurance premia increased more than 8% year-on-year.

A 12 per cent year-on-year increase in energy prices—well, that $275 reduction in power bills is well gone. We know why the Prime Minister was happy to make that commitment 97 times, I think it was, before the election and not one time after.

The Australian people know prices are not coming down; they're going up. This is what happens: you spend more, you don't actually have a plan to address cost of living, you commit $40 million to sell a plan of $15 a week in five months, and you give $14 million to food banks. When your priorities are wrong, it makes it harder and harder for the Australian people. An Australian who was on $55,000 when Labor came to government has seen their real buying power decrease by almost $4,000 because of the $209 billion in additional spending plus the $45 billion off budget. It's driving inflation and driving costs up.

Those opposite like to say: 'We've delivered a surplus. We've delivered a surplus, and that's solved all the problems.' There's a problem with a surplus: there's a headline, but there are two sides to how a budget surplus is delivered. There are increases in revenue, and there are decreases in spending. If the revenue was increasing, but the spending is also going up, even though it's not going up as much, it still drives inflation. The Treasurer likes to take credit for the surplus, but what he doesn't talk about is what's driving that surplus. The reality is that, as the budget papers confirm, it's increased revenues coming in. It's soaring iron ore and coal exports that are delivering the trade surplus. It's commodity prices that are helping to deliver that $4 billion surplus. As EY's chief economist, Cherelle Murphy, commented last year in May about the budget:

The $36.9 billion deficit projection for 2022-23 was revised to a modest $4.2 billion surplus … through a combination of higher company and personal income tax receipts and conservative commodity price forecasts. The surplus projection ends there, as positive cyclical forces fade and the economy slows.

The position of the Budget is expected to worsen after 2024-25 as tax receipts moderate, along with spending pressures across the forward estimates.

We've seen that those tax receipts have increased, and that's why we're likely to get another surplus this year. Dr Steven Kennedy, Secretary to the Treasury, has flagged in Senate estimates this week that the higher than assumed commodity prices are going to continue to increase government revenue. He's said that there are further upside risks to the tax receipts. He went on to say, 'Over the four-year forward estimates period, there was a $39.5 billion improvement, driven by soaring personal income taxes and company taxes.'

That is the detail that matters when we talk about a surplus in a high inflation environment. It is whether you're bringing demand out of the economy or whether you're continuing to feed demand into the economy. The Treasurer can stand in the House at question time and talk about a surplus, but it's not actually bringing inflation down because inflation is being driven by higher receipts on tax—your personal tax. The little trick this government played is that they're happy to change stage 3, but they don't talk about how they let the low- and middle-income tax offset lapse last year—the $1,500. Many people in my community and across the country in July and August last year were desperate for a tax return because the cost of living is so tough. When they put their tax return in, they were disappointed. They were disappointed because the $1,500 that they'd received in the previous years was no longer there. What had happened is the government made the decision to let the low- and middle-income tax offset lapse, which is fine. We didn't talk about it, because that was part of stage 1, stage 2 and stage 3 of the tax cut package that they voted for in 2019.

An honourable member interjecting—

Yes, we did legislate that legislation, and then this government has shown in the last two weeks that they're prepared to change the legislation when it comes to tax. So they're prepared to change the legislation to give the Australian people $15 a week extra in five months, but this government wasn't prepared to change the legislation last year to give the Australian people $1,500 straightaway in July or August when they did their tax return, when they needed it.

This is what the Australian people know: everything has gone up under this government, despite the promises of the Prime Minister during the campaign. Food has gone up more than nine per cent. Housing has gone up more than 12 per cent. Electricity is up by 23 per cent, despite that promise to reduce bills by $275. Gas has gone up by more than 29 per cent, and every resident in Casey knows this when they get their bills or go to the grocery store. Energy and gas in particular are important because they hit the Australian people in two ways. They hit you when the bill comes in, but they hit you every time you go to the grocery store. I worked in food manufacturing for many years prior to this role, and energy was one of the largest costs in manufacturing our food. It wasn't just our largest cost; it was one of the largest costs in the materials that we bought. When you go into the supermarket, you need to understand that the food manufacturer is being hit with increased costs. I'm not going to defend Woolworths and Coles, but they've been hit with increased costs. Those coolrooms and distribution centres they have are incurring increased costs.

And it goes further back. Take corn chips as an example. The farmer that grows that corn is being hit with increased cost, and this all gets passed along the line so, when you get to the supermarket, you get groceries at a higher price. That's the reality. That is why it is so important that you bring energy prices down: because it affects the whole community. That's not even to talk about the community groups that are impacted: those sporting clubs, charities, food banks that have to pay those higher energy prices. This is what we've seen. The Prime Minister himself admitted at the National Press Club that their policies aren't working and they don't have the cost-of-living crisis under control. That's why he made the decision to break his word that he committed a hundred times to the Australian people. That's been the big change. The war in Russia and Ukraine was many years ago. It was there when he made these promises. What has changed is that this government doesn't have any solutions for the Australian people.

Everyone knows that. They know it when they put the petrol in their car. They know it when they have to pay for the supplies for their children's education, when they go to the grocery store, when their rates come in from council, when their rent is higher than last year and when their mortgage has gone up 12 times in the last 18 months.

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