Zoe McKenzie (Flinders, Liberal Party) Share this | Link to this | Hansard source

My question is to the Prime Minister. The government assured Australians that the budget would bring interest rates down. Instead, we now find it has forced interest rates up. New data from Finder shows that 40 per cent of Australians with a mortgage are struggling to meet repayments, up 24 per cent alone from 12 months ago. When will the Prime Minister take responsibility for making things worse for middle Australia?

Anthony Albanese (Grayndler, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the member for Flinders for her question. Of course, the world is dealing with inflationary impacts. Inflation, therefore, has an impact on interest rates. The Australian interest rate, of course, is lower than the UK's of 4.5, the US's of 5.25, Canada's of 4.75 and New Zealand's of 5.5. They're the interest rates in other Western industrialised countries. It is noteworthy that other English-speaking advanced economies do have higher interest rates. But, as the Governor said at the Morgan Stanley Australia summit, on 7 June, 'The situation is improving.' He said:

… inflation is coming down.

And:

There is also evidence of declining inflation pressures in global markets.

He then went on to speak about employment, and we have some employment figures out today as well. He also said, very clearly, at Senate estimates:

I don't think that the budget is adding to inflation; it's actually reducing inflation in the next financial year.

One of the things that we're doing as a government is making sure that fiscal policy works with monetary policy, not against it. That's why the $78 billion deficit that was forecast by those opposite has been turned into a forecast of a forecast of a $4.2 billion surplus.

We know that inflation, of course—those opposite would recognise, and I'm sure that they know, that the highest inflation rate of any quarter this century was, indeed, on their watch, of 2.1 per cent in the March 2022 quarter. We know also that their budget, their last budget that they got to hand down, where money was sprayed around in order to try and win an election, certainly did not have an impact of working with monetary policy—indeed, the exact opposite.