Dave Sharma (NSW, Liberal Party) Share this | Hansard source

I move:

That the Senate take note of the answers given by ministers to questions without notice asked by Opposition senators today.

What we heard today was a government in denial about the scale of economic challenges that Australia is facing. We had Senator Canavan ask Senator Gallagher about business insolvencies being at a four-year high. We had Senator Dean Smith ask questions about the size of public sector spending, now at a high of 27.3 per cent in the quarter, and the role of public sector spending in contributing to inflation. But what we heard from Senator Gallagher was that the facts don't support that, that the RBA was being misquoted and that public demand was being demonised, and she was trumpeting a headline inflation figure.

It has taken me a while to figure out the meaning of this term 'gaslighting', but after a lot of discussion with my children I think this was a textbook example of gaslighting—telling not only those of us on this side of the chamber but the Australian public that their lived reality, their lived experience, of higher electricity prices, of higher inflation, of deteriorating living standards, of lower disposable income and of higher interest rates is not actually true. We had Senator Gallagher say that COSBOA's figures were wrong, that the RBA didn't say what they said, that the Productivity Commission, which has been warning about these things, was also wrong and that, indeed, the everyday lived experience of Australians was wrong.

Let's look at the facts here. Insolvency rates in Australia right now are 25 per cent higher than they were prior to the pandemic—5.04 per cent in October. That means that one in every 20 businesses has been failing over the last 12 months. CreditorWatch expects this to rise to 9.1 per cent in the next 12 months—that is, one in every 11 business will be at risk of failure. Senator Gallagher's answer was: 'The facts don't support that.' We've now seen public sector spending reach a record of 27.3 per of GDP in the June quarter. The average size of public sector spending in the decade prior to the pandemic was 22.5 per cent. So we've seen government spending massively increase.

Senator Gallagher was trumpeting employment growth. Well, of the 209,000 jobs created in the first half of 2024, fully one in two of them was a public sector job. In normal economic conditions, in normal economic times, six in seven jobs are private sector jobs and one in seven is a public sector job. Instead, one in two of those jobs created are in the public sector. We've seen 26,000 more permanent APS staff added to the payroll, adding $5 billion annually to the government's wages bill.

Real household disposable income has declined eight per cent in Australia since the first quarter of 2022. That's why everyone is feeling worse off: because they're paying more in taxes, because inflation is eating up more of their after-tax income and because interest rates are higher. That is the worst performance in the OECD, if you look back over the last 2½ years. In the US, for instance, real household disposable income has increased by three per cent since the first quarter of 2022. In Australia, it's gone backwards by eight per cent. That's why people feel like we're in a recession: because we've had six consecutive quarters of negative real GDP per capita growth. The only thing that is keeping the economy ticking over, in notionally positive terms, is record-high immigration.

We have core inflation at 3½ per cent—still stubbornly high. Senator Gallagher was trumpeting the headline inflation rate. The RBA has been very clear that they are looking at the core or underlying inflation rate when they are looking at interest rate settings, and we just had Michele Bullock, the Governor of the RBA, warn earlier this month, publicly, about the inflationary implications of the government's own policy—a shot across their bows. Yet we didn't have Senator Gallagher ruling out massive handouts or spending sprees prior to the election. Instead, she focused on a policy that the government should be embracing—zero emissions nuclear energy—but which, instead, they are shunning.

So we have a government here which has no answer to inflation, no answer to the challenges of homeownership, no answer to the productivity challenge, no answer to high electricity prices—and, incidentally, no reduction in emissions. It contests what the RBA says, what COSBOA says, what the Business Council of Australia says, what the Productivity Commission says—indeed, what everyday Australians say about how tough living conditions are. Its only answer is some sort of alternative reality where we are told that Australians have never had it so good. Their experience is quite the opposite.