Claire Clutterham (Sturt, Australian Labor Party) Share this | Hansard source

I thank the member for Wentworth for her remarks, and I share her view that supporting the private sector, as the beating heart of productivity in this country, is vital. The economy, including productivity, cost of living and growth, is central to the Albanese Labor government's agenda. Increases to productivity and growth are what this government's policy initiatives are directed at, as is providing help and assistance with the cost of living to Australian families.

It is clear that inflation rates are higher than desirable, and we do not shy away from that. It is also clear that inflation is lower than its peak and significantly lower than when we came to government, but, history aside, it is still too high. Inflation and what drives it is not linear. It's not black and white. It's not one thing or another. It's a mix of fluid and ever-changing factors that need to be constantly monitored and adapted to. Factors like the time of year, private demand, climate, the labour market, global challenges and government policy all play a role in the ingredients that make up the inflation cake. Sometimes one factor plays a bigger role, sometimes smaller. It's not linear, and it's not as simple as saying, 'Just cut this,' 'Just do that,' or, 'Just change this.' The current data shows that our inflation challenge is a mix of temporary factors, like the end of energy rebates and an increase in travel costs over the summer, and persistent pressures in areas like housing. This combination underpins the fact that inflation doesn't always moderate in a straight line. The mix of factors are relevant and present, but they do not necessarily matter to the millions of Australians, myself included, with a mortgage, who will need to manage the 25 basis point increase. Families and businesses will be impacted, and many will have to make difficult decisions.

A decision may be widely expected, but it is still a decision that has impact. We are aware of this impact. The government understands that many Australians are still under pressure and that responsible cost-of-living relief remains important. That cost-of-living relief includes tax cuts for every Australian worker. In addition to the first round of tax cuts, Australian taxpayers will receive a further two rounds of personal income tax cuts from 1 July this year. A new thousand-dollar instant tax deduction will be introduced from the 2026-27 financial year, which taxpayers will be able to claim instead of individual work related expenses.

The government's healthcare and education initiatives also fall under the umbrella of cost-of-living relief, because every policy this government introduces is underpinned by a laser-sharp focus on economic management. The cheaper medicines initiative, which began on 1 January this year and which reduced PBS medications to just $25 per script or $7.70 for concession card holders, was not just about healthcare. It is about easing the economic conditions for the average Australian household. Free TAFE, grants for apprentices and 20 per cent off all forms of student debt—university, TAFE, VET and apprenticeships—is not just education reform. It is economic reform for the individual beneficiary and their household.

Cheaper child care provides more children access to early education, but it's not just about access to early education; it is an issue of economic management. Pay rises for early childhood educators are about recruitment and retention into this vital industry, because we know that we need more highly skilled early childhood educators to educate the children of other skilled professionals if that is what they choose for their children. Education is the driver of this initiative, but it is not the only consideration. Enabling access to the paid labour market for parents so that they can contribute to the economy is a key and deliberate aspect of this initiative.

These economic initiatives are being prosecuted in parallel with structural budget repair. MYEFO illustrated that the Albanese Labor government has found more than $114 billion in savings and that the budget is in fact $233 billion better off than when Labor came to government. There is less debt in every year of the forward estimates because of the policy decisions that have improved the bottom line. Finding savings and embarking on restructures of government programs to deliver efficiency gains will always be preferrable to reducing services, increasing taxes or cutting important areas like Defence spending, something that forms a critical part of government spending and which we simply cannot afford to reduce.

There are some signs of progress, but last week's RBA decision shows that more progress is required. Therefore, progress in this respect and progress in respect of the economy will be the focus of the government's agenda in this year's budget and beyond.

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