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

My question is to the Treasurer. In 2022 the now Treasurer declared, 'There are things that real leaders take responsibility for, which matter in the context of high inflation, rising interest rates, plummeting consumer confidence and falling real wages.' The Treasurer is, right now, failing on all these same metrics and Australians are getting poorer by the day. Treasurer, when will you start living by your own words and take responsibility?

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

As I've said on a number of occasions today, and before that as well, I take responsibility for all aspects of my job. I take responsibility for my part and our part in the fight against inflation. I take responsibility for the fact that this government is rolling out cost-of-living help that those opposite oppose. I take responsibility for the fact that the budget is much, much stronger now, because of our collective efforts, than what we inherited from those opposite. I take responsibility for all aspects of my job. More than that, we are taking action. We are taking action with cheaper medicines, with more bulk-billing, with student debt relief, with free TAFE and with two more tax cuts, opposed by those opposite, after the first one, also opposed by those opposite. I have made it clear that I take responsibility for all aspects of my job, including my part of the fight against inflation.

What makes it especially galling to get this question from those opposite is they left us with inflation north of six per cent and absolutely galloping when we came to office. The inflation challenge peaked in 2022 because we inherited from them inflation much higher and rising. We also inherited much bigger deficits and more debt. To make it worse, those opposite, every one of them—when they used to be in the same party before they went their three separate ways—took to the last election a policy for higher income taxes, higher electricity bills, bigger deficits and more debt. We won't be taking lectures from those opposite about responsible economic management. They might change their leader, but they can't change their record. They can't change the fact they left us higher and rising inflation. They left us bigger deficits and more debt. They took to the election a policy for higher taxes, higher electricity prices, bigger deficits and more debt as well.

What this government is doing is rolling out cost-of-living help in a responsible way at the same time as we get the budget in a much better condition than we inherited from those opposite. We delivered two surpluses. We found $114 billion in savings. We got the Liberal debt down. We got real wages growing for two years. We got inflation down from a six in front of it and rising, which is what we inherited from those opposite. So, again, we won't be taking lectures from those opposite. They are the key reasons why nobody takes them seriously on the economy anymore, a point that Peter Costello himself made when he was talking to Troy Bramston at Christmas.

There are real challenges in our economy. We are focused on them. They're just focused on themselves.

Steve Georganas (Adelaide, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Can the Treasurer update the House on the interest rates decision taken this afternoon by the Reserve Bank.

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

Thank you to the member for Adelaide for his question today. As expected, the independent Reserve Bank has increased the cash rate by 25 basis points. This will be difficult news for millions of Australians with a mortgage, and we understand the pressure that this puts on Australian families and businesses. Now while today's decision was widely expected, obviously, that doesn't make it any easier. We know that many Australians are doing it tough, which is why we continue to roll out responsible cost-of-living relief, including a further tax cut this year and another one next year—both of them opposed by those opposite. At the same time, we're doing what we can to strengthen the budget and to address our longstanding productivity challenge. Our mid-year budget update showed the budget is more than $233 billion better than we inherited from those opposite, and part of the reason for that is $114 billion in savings since we came to office, including $20 billion in the mid-year update.

I want to make it really clear to the House and to people watching from home that the statement released by the independent Reserve Bank explaining the decision that they have taken today does not mention 'government spending' at all. It doesn't mention 'government spending' at all. In fact, it makes it very clear that the pressure on inflation is coming from private demand. Let me make this really clear. This is the Reserve Bank board in their statement just released: 'Growth in private demand has strengthened substantially more than expected …' This is the point that the Reserve Bank has made today. Pressure on inflation, the big contribution to growth in our economy, is coming from private demand and not public demand, and that is clear. And the statement on monetary policy, which the Bank has also released today, said that the upgrade to the near-term outlook was due to stronger private demand. They said the near-term upward revision is driven by private demand and that the contribution of public demand to year-end GDP growth has continued to ease in recent quarters, as expected.

So what we've seen in our economy is public demand in retreat over the course of the last year, private demand growing strongly, and that explains the additional pressure on inflation.

Now, I want to make it clear that, even though inflation has moderated substantially since those opposite were in office, it is higher than we would like. We've acknowledged that since the data came out. Some of that is temporary pressures. Some of that is more persistent pressures. All of that is adding to the pressures that people are feeling around the country. That's why our cost-of-living relief is so important and that's why it's so important that we've got the budget in better nick than what those opposite left us.

David Littleproud (Maranoa, National Party, Shadow Minister for Agriculture) Share this | Link to this | Hansard source

My question is to the Treasurer. Treasurer, after today's interest rate hike, mortgage holders are paying more because inflation is staying higher for longer. Treasurer, when will you apologise to all mortgage holders in Australia?

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

I thank the leader of one of the three far-right parties in this country for his question.

Opposition Members:

Opposition members interjecting—

Milton Dick (Speaker) Share this | Link to this | Hansard source

Order! Members on my left. There is far too much noise. I can't hear what the Treasurer is saying.

The member for Lyne is not helping the situation. The Treasurer will return to the question.

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

Thank you to the member for his question. As I made clear a moment ago, we know that, even though today's decision was expected, it doesn't make it any easier for people who are already under pressure. I think I've made that really clear. We do know and we have said repeatedly through the course of today and before now that Australians are still under pressure. Despite all of the progress that we've made together in our economy, we know that Australians are still under pressure. That's why our cost-of-living relief is so important, and that's why it's so strange that those opposite oppose that cost-of-living relief. It's why our budget repair is so important and why it's so strange that those opposite left us such a mess and now want to give us lectures about the budget position that we've spent 3½ years cleaning up.

As we know, some of these inflationary pressures are temporary; some of them are more persistent. All of them are adding to the pressures that people feel in real communities. We don't just acknowledge that; we're acting on that as a government, collectively. We're acting on that with cheaper medicines, tax cuts, more bulk-billing, student debt relief and the like. If those opposite really cared about the pressure on people around this country, they would have supported that cost-of-living help. Instead, they opposed that cost-of-living help. Worse than that, the same people asking these questions today took to the election a policy of higher income taxes on every single Australian worker.

The only thing that they've been able to agree on in the course of recent months is that they all desperately wanted interest rates to go up today. They all desperately wanted interest rates to go up today. It's the only thing that they can agree on right now. So they should spare us their confected outrage. They left us much higher inflation. They left us a much weaker budget. They took to the election a policy to make all of that worse, not better. This side of the House is focused on the cost-of-living challenge. That side of the House is focused on who sits where from one week to the next. We won't be distracted by opposition parties which are divided, divisive and in disarray.