Ted O'Brien (Fairfax, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question goes to the Treasurer. The Treasurer has overseen a litany of economic disasters but always blames someone else: higher energy prices—someone else's fault; the fastest fall in living standards in the developed world—someone else's fault; 12 interest rate rises—someone else's fault; unemployment's up—someone else's fault; on our way to a trillion dollars of debt—someone else's fault. Will the Treasurer take some responsibility for his economic mismanagement?

Jim Chalmers (Rankin, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

When there are good developments in the economy, I share the credit with the Australian people. And I, as Treasurer, and this government take responsibility for working through the challenges in our economy. Having taken responsibility for cleaning up the mess that was left to us by those opposite, I think it's time for those opposite to acknowledge as well and to take responsibility for the fact that they had inflation running twice as high as it is now, and they had huge deficits as far as the eye can see, and they racked up a trillion dollars in Liberal debt. They doubled the debt even before the pandemic.

So we take responsibility for working through the difficult issues in our economy. We're getting real wages moving again. We've got inflation down to half of what we inherited. We delivered a couple of surpluses. We got the deficit in the third year down to a fifth of what we inherited from those opposite. We got the debt down by $188 billion, saving Australians $60 billion in debt interest compared with what those opposite left them. If you look right across the board, average unemployment under this Prime Minister is the lowest of any government in the last half a century, and there is the progress we've made together on inflation, and the fact that unemployment is 4½ per cent—historically low, and part of an average unemployment rate much lower than what was left to us by those opposite.

We're under no illusions about the challenges in our economy. We take those challenges seriously, and inflation is one of them. But, more than acknowledging that people are still under pressure despite the progress we've made together, we're actually doing something about it. When Australians are under pressure, this building, this House of Representatives, has two choices: to do something about it in the most responsible way that we can—which has been the approach of this Albanese Labor government—or to oppose that cost-of-living help and to take the most irresponsible course of action, which is the course those opposite have adopted.

So I finish by saying this: if those opposite really cared about the cost of living, they wouldn't have opposed our tax cuts. If those opposite really cared about electricity prices, they wouldn't have opposed our efforts to give people a bit of help with their electricity bills. If they really cared about the cost-of-living pressures in communities right around this country, they wouldn't have opposed our efforts to make medicines cheaper. I could go on. But I hope they get the point: there's a difference between hoping for cost-of-living pressures, which is their approach, and doing something about them, which is our approach.

David Smith (Bean, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Can the Treasurer update the House on the Reserve Bank's decision on interest rates today?

Jim Chalmers (Rankin, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

As honourable members would be aware, today the independent Reserve Bank kept interest rates on hold at 3.6 per cent. I acknowledge that many Australians would have wanted to see more rate relief at this meeting, but this decision was widely anticipated by markets and widely expected by economists. It is the case that inflation is much lower than we inherited from those opposite, and that has given the Reserve Bank the confidence to cut interest rates three times already this year.

Those three interest rate cuts reflect the very substantial progress we've made in our economy together. When we came to office, headline inflation was 6.1 per cent and rising; it's now around half of that. When we came to office, trimmed mean inflation was almost five per cent and rising; it's now been within the target band for three consecutive quarters, albeit at the top of the target band now. If you look around the world, inflation ticked up in September for every major advanced economy except the UK, where it was flat but much higher than it is here.

Once again, as I did in the answer a moment ago, I acknowledge—we acknowledge—that, even with this progress we've made, Australians are still under pressure. Those three interest rate cuts are providing a bit of relief, but we know that many Australians would have preferred to see more relief delivered today. We've got inflation down, we've kept unemployment low, the economy has continued to grow, the private sector is recovering in welcome ways, we've got real wages growing and interest rates have fallen three times this year. But we always know that there is more work to do.

If you have a look at the forecasts which were also released with the Reserve Bank's decision today, you will see that, when it comes to government spending, in the Reserve Bank's own forecasts they've actually downgraded the contribution made by public spending in our economy. I think that does torpedo some of this dishonesty that comes from those opposite about the role of government spending. I point that out, acknowledging the usual politics will be played by those opposite. But, if those opposite want to claim that budgets are the decisive factor in interest rate decisions, then they've got to explain those three interest rate cuts this year, including two interest rate cuts which came after the budget in March.

We will continue to work through the issues in our economy, the challenges in our economy, in the most responsible, considered and methodical way. We've made a lot of progress together in our economy. We know there's more work to do, and we've acknowledged that throughout.