Dean Smith (WA, Liberal Party, Shadow Assistant Minister for Foreign Affairs and Trade) Share this | Hansard source

Government senators are guilty of suffering from the effects of long COVID—selective memory and forgetfulness. When we talk about the budget decisions that were taken by the Morrison government, let's remember only one thing: the pandemic. In fact, had Labor's measures been adopted by the Morrison government, that level of spending as a percentage of GDP would have been considerably higher, not lower.

Anthony Albanese, the Prime Minister, was elected on one pledge. He said that Australians would be better off under Labor. Well, the beginning of 2026 has been marked by a trifecta of trouble for Australian families and Australian businesses, with energy costs rising, inflation rising and now interest rates rising. And who is paying the price for this? Australian families and Australian small businesses. The Australian Bureau of Statistics has said that electricity prices increased by 19.9 per cent in the year to November 2025, and it identified seven per cent in just one single month. The average residential energy debt for Australian families is now up by almost $1,500, or 38.6 per cent, since Labor was elected in 2022, and 205,000 Australian families are now on electricity hardship programs.

Inflation is the menace in any economy. It hurts pensioners. It hurts young families. It hurts businesses. The inflation rate has now risen to 3.8 per cent. The trimmed mean rate for inflation is now 3.3 per cent. Both of those numbers sit outside the RBA's band for inflation, so it's no surprise that the RBA has had to step in to correct the government's bad management. That bad management is being driven by excessive levels of government spending. The inflation rate in Australia is now higher than in the United Kingdom, the United States, Canada, Japan and Germany. That is the record of that Labor government. And, of course, interest rates—Australian families woke up this week to discover that they had to find more in their income in order to meet mortgage repayments because the banks, not surprisingly, have now followed through on that RBA rate decision and increased interest rate payments for Australian families and households.

This is what happens when you have a government that doesn't understand this economic fact: high levels of government spending always result in higher levels of inflation, which always result in higher interest rates. That is the economic law that Treasurer Jim Chalmers and Prime Minister Anthony Albanese think that they can ignore. But there is one Labor government minister who understands what's happening, and she belled the cat in the media this week. Congratulations to the Minister for Employment and Workplace Relations, Amanda Rishworth, for calling her own government out. And what did the minister say? She said that it was 'unwelcome' that inflation had ticked up. She also said, when asked how the government can respond, that it's important that we make sure that the government is 'repairing the budget'.

Why does the budget need repair? Because the government's spending in the budget is now the highest it has been for 40 years. The government's own economic documents say that government spending for 2025-26 will be 26.2 per cent of GDP. That is the highest level of government spending outside of the pandemic. It is the highest level of government spending in 40 years. Government spending is growing at four times the rate of growth in the economy. This is why 2026 has started off badly for Australian families and Australian businesses—and guess what? Australians are about to find out that it's going to get worse under Labor. (Time expired)