Rick Wilson (O'Connor, Liberal Party) Share this | Hansard source

As I'm in continuation, I'll just reiterate some of the points I was making last week about the government's profligate spending. I just remind people that spending growth is running at four times the rate of the growth of the economy, and debt is forecast to soon reach $1.2 trillion. Spending is now $160 billion higher than when the government came to office in 2022. That's an additional $16,000 for every household across Australia. Since coming to office, the government has added around $100 billion to the national debt.

In 2024-25, the Commonwealth raised $717 billion in receipts, which is equal to 25.9 per cent of GDP, the highest in 25 years. While I touch on revenue raised, many middle-income earners would have experienced over the last four years bracket creep taking a larger percentage of their wages every week. Those are the stage 3 tax cuts that the previous government legislated and which were reversed by the current government. As we as we know, last week the inflation figure jumped back to 3.8 per cent, which is the highest in the developed world. Comparable countries like the United States are at 2.4 per cent, and the European Union is at 1.9 per cent.

One of the things about having lower inflation as a starting point is that, when you do get a world shock, like the current conflict in the Middle East, then you're starting from a reasonable point. When you start at 3.8 per cent, as the Reserve Bank have forecast, the conflict in the Middle East will add 1.2 per cent to our inflation. We will be up at five per cent, according to that forecast, which will be catastrophic. In February, the Reserve Bank raised interest rates by 25 basis points, so we're now sitting at 3.85 per cent.

The government simply cannot escape the law of economics. High government spending always results in higher inflation, and higher inflation demands higher interest rates. According to Compare the Market, a single 0.25 percentage point rate rise could push monthly repayments up by about $94 for someone with a $600,000 mortgage. That's an extra $1,182 per annum. The Prime Minister and the Treasurer were very keen to take the credit when inflation briefly started to trend down, and they now must accept the blame as it goes back up. Let's not hear any excuses from the Treasurer about the current conflict in the Middle East. That 3.8 number was baked in well and truly before we saw that conflict erupt.

People have asked, and there have been senior ministers from the other side of the chamber calling out during question time: 'What would you cut? Where would you cut?' I'll give the government a bit of free advice here. It's about the fringe benefits tax exemption on electric vehicles. Now, this is an absolute doozy. This is the scheme whereby people buying electric vehicles under novated leases are exempt from the fringe benefits tax. The cost of this scheme has blown out by a factor of 15 on the government's original numbers. These are numbers I'm getting from a climate policy think tank called Climateworks Centre. They were quoted in the Australian Financial Review. This is a climate change think tank:

… $1.35 billion in lost tax this financial year—up from the original forecast of $90 million. Under the FBT exemption policy, a person who leases a $60,000 car would save close to $12,000 per year if they bought an EV instead of a petrol car …

The Financial Review reported in August that the policy was set to cost more than $23 billion over the coming decade. But the real clincher here is that the benefits of this scheme flowed disproportionately to workers earning more than $150,000, who made up more than 50 per cent of the recipients. This is the Labor Party, right?—the party of the battler, the party of the worker. You couldn't make this stuff up.

The one last clincher here is that this $1.5 billion per annum subsidy—effectively, to the Chinese car-making industry—is more money than the Australian governments, both Labor and Liberal, used to subsidise our own domestic car industry. Get that! We are now subsidising the Chinese car industry to a greater extent than we ever subsidised our own domestic car industry. That is the level of complete economic mismanagement that this government has foisted on the country.

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