Marielle Smith (SA, Australian Labor Party) Share this | Link to this | Hansard source

Senator Paterson has submitted a proposal, under standing order 75, today, as shown at item No. 14 of today's Order of Business:

The need for action to address the worsening cost of living crisis facing Australian families and small businesses, driven by persistent inflation and higher interest rates, and exacerbated by the Government's reckless spending and policy failures—including on housing—which are keeping prices and mortgages higher for longer.

Is consideration of the proposal supported?

More than the number of senators required by the standing orders having risen in their places—

With the concurrence of the Senate, the clerks will set the clock in line with the informal arrangements made by the whips.

James Paterson (Victoria, Liberal Party, Shadow Minister for the Public Service) Share this | Link to this | Hansard source

I move:

That, in the opinion of the Senate, the following is a matter of urgency:

The need for action to address the worsening cost of living crisis facing Australian families and small businesses, driven by persistent inflation and higher interest rates, and exacerbated by the Government's reckless spending and policy failures—including on housing—which are keeping prices and mortgages higher for longer.

Today is a tough day for many Australian households, particularly those with mortgages, because they've received the news of the 13th rate rise on Labor's watch. They've received the news that their mortgage repayments will be going up. For many Australian families, this is not the news they were promised. This is not the news they were expecting, because they've heard our Prime Minister, and our Treasurer, Mr Chalmers, tell them that the worst is behind us, that better times are ahead, that they've slayed the inflation dragon and that they've got it under control. But nothing could be further from the truth.

The truth is, the average Australian household is $21,000 a year worse off than they were when it comes to mortgage repayments than when Labor came to office. That is, someone with an average loan of $600,000 is paying $21,000 more a year on their repayments because of interest rate rises that have happened on this government's watch.

This government has presided over three interest rate reductions. When those happened, Jim Chalmers was very quick to take credit, very quick to say that it was as a result of the government's economic management that rates were coming down. But now that rates are rising again he's even quicker to say that he bears no responsibility, that the Albanese government bears no blame and that others are to blame—that international factors are responsible are for rising inflation.

The problem with that story is that it's not true. In fact, Australia has some of the highest inflation among advanced economies—higher than the United States, the United Kingdom, Canada, Japan, Germany and many others. While their rates are falling, our rates are rising, and it is very clear why. You can ask any economist what the effect of Labor's reckless spending is and they will tell you that with spending at a 40-year high outside a recession, as a proportion of the economy, that is driving upward pressure on inflation and that is leading directly to interest rates increasing today.

Take, for example, Judo Bank's Chief Economic Adviser, Warren Hogan, who said:

But if the governments of Australia do nothing, I think the RBA is going to have to take the cash rate above where it was a year ago—above 4.35 and most likely towards five and put this economy at risk of recession.

They have to do that though if the government of Australia will not act.

Or take AMP Deputy Chief Economist Diana Mousina, who said:

… it appears that directly, the government has been adding to inflation in recent years, as you would expect in an environment of public spending lifting to a record high.

Take AMP's Chief Economist, Shane Oliver, who said last week that a lot of the factors driving inflation relate to government spending. Even Alex Joiner, the chief economist of IFM Investors—which is, of course, a vehicle of the industry superannuation industry—has said:

We already have fiscal policy getting looser, but it could be even looser than we expect. The fiscal guard rails have come off.

And HSBC Chief Economist Paul Bloxham said yesterday:

… the primary driver of the pick-up in inflation is not strong demand. To the extent that demand is playing much of a role, it is that public demand growth has been strong, due to government spending.

These are the expert opinions that Jim Chalmers would like to dismiss as partisan, but I don't think these economists are partisan, and neither are economists at the RBA, who have made many similar observations in recent months, or, of course, the RBA governor herself, who acknowledged to me in Senate estimates recently that, all else being equal, if government spending is rising then that drives up pressure on inflation and therefore interest rates.

When it comes to this government's wasteful spending, sometimes it's the small things that tell the story and sometimes it's the big things. We learnt recently that the government spent $1.6 million renovating a party room for their Greens partners here at Parliament House—that is, one room in Parliament House and $1.6 million to tune it up to the circumstances that the Greens expect. When you can build a brand-new home, a perfectly nice family home, for $400,000 to $500,000, it seems extraordinary to me that Labor thinks $1.6 million is good value for taxpayers' money. Or take the CSIRO, which was recently exposed as having spent $500,000 on manicured lawns and rented pot plants. This is an agency that employs botanists in-house and so could probably manage to water a plant if required. Then there is the big one, the EV tax uptake, which was supposed to cost $90 million this financial year but has blown out by 15 times to $1.35 billion.

The truth is that when Labor spend you pay. This is a government that's failed to control its spending. That's why rates have risen today and that's why you will pay.

Ellie Whiteaker (WA, Australian Labor Party) Share this | Link to this | Hansard source

I rise this afternoon to oppose the urgency motion moved by Senator Paterson. Frankly, I think it's extraordinary that those opposite still can't seem to remember all the great things our government has done to help with the cost of living—although I probably shouldn't be surprised, because they've been a bit distracted recently. What's really clear to me and I think what's becoming increasingly clear to Australians is that, while the Liberal Party and the National Party are focused on fighting themselves, our government is the only party that is focused on delivering for Australians, the only party that has the capacity to be responsible economic managers and the only party that is committed to bringing down the cost of living.

Australians are seeing support from our government at the pharmacy counter, with our cheaper medicines policy bringing the cost of pharmacy scripts down to $25, the lowest it has been since 2004. Australians are seeing support when they go to the doctor, thanks to our bulk-billing incentive. They're seeing support with their childcare bills, with our three days of guaranteed child care. They're seeing support in their pay packets, with our plan for further tax cuts, with the tax cuts we've already delivered and with the higher wages that Labor has delivered. University students are seeing support from our government, because we have cut their HECS debts and reduced the amount at which they have to start repaying them.

Senator Paterson and his colleagues like to talk about housing, but they seem to forget a really crucial fact. The coalition—sorry, they're not the coalition anymore. That is my mistake. We're going to have to keep reminding ourselves of that as things change day by day. The Liberals and the Nationals have opposed every single housing initiative that we have brought before this parliament—yes, every single one. They have opposed our measures to build more homes. They have opposed our measures to get more people into their first homes. They have opposed our investment in social and affordable housing. The absolute hypocrisy from those opposite to come in here and talk to us about housing! They complain about housing affordability, yet they have not presented a plan to this place or to the Australian people as to what they would do when it comes to making housing more affordable.

I want to talk to the decision by the RBA today to lift interest rates. This, of course, is not news that we were hoping for, but it is news that we were expecting. We know that, for many Australian families, it is difficult news. We understand that this increases pressure on Australian families who are trying to pay mortgages. That's why our government is committed to continuing to roll out cost-of-living relief. We will not stop, and we will continue to do what we can to help. There are further tax cuts to come later this year, and, at the same time, we're doing what we can to strengthen the budget and address our longstanding productivity challenge. Our midyear update showed that the budget is more than $233 billion better off than when we came to government. We have found more than $114 billion in savings since coming to office, including $20 billion in last year's midyear update.

We are committed to undoing the mess that we were left by those opposite. When we came to government, inflation had a six in front of it. It's really clear to me—and I think it's clear to Australians right across this country—that those opposite should perhaps spend some time, instead of fighting each other, supporting our government's cost-of-living measures and supporting our housing affordability measures.

Mehreen Faruqi (NSW, Australian Greens) Share this | Link to this | Hansard source

I must say it is pretty rich of the Liberals—the party most closely aligned with the one per cent—to talk about the cost of living. I am really sick and tired of the Liberals, the Nationals and Labor lecturing people about a cost-of-living-and-housing crisis that their governments created and their governments continue to perpetuate. It is hypocritical, it is hollow and it is cruel. When ordinary people are suffering, the Liberals turn up like charlatans in the town square, claiming to have answers, but they are selling the same snake oil they always do: racism, fear, hate and blame. They talk about solutions but offer only scapegoats: migrants and minorities. And Labor is cut from the same cloth, just with different marketing. Labor, the Liberals and the Nationals all claim to stand with ordinary Australians, but their actions tell a different story. When it comes time to act, relief flows in one direction only—upwards to the big banks, to landlords, to coal and gas giants, and to billionaires. They protect corporate profits and refuse to tax obscene wealth. This is not an accident. These parties defend a broken housing system, which lets speculators pocket millions while first home buyers and renters suffer.

Today's interest rate rise is pure profit for the big banks while mortgage holders and renters are being pushed deeper into pain. None of the big parties can claim the moral high ground while fanning the flames of hate and blaming migrants, exactly like One Nation does, and making matters worse for ordinary people. We need structural change to overhaul an unfair economic system so that it starts working for the 99 per cent. (Time expired)

Jacinta Nampijinpa Price (NT, Country Liberal Party, Shadow Minister for Defence Industry) Share this | Link to this | Hansard source

Australians were promised that, if they worked hard and played by the rules, they could get ahead. That promise is broken—broken by a government that refuses to live within its means. Australians don't resent hard choices; they resent being punished for doing the right thing. That is why this urgency motion is before the Senate today. Why is inflation persistent? Why are interest rates going up? It's because we have an arrogant government that refuses to rein in its own spending. This is not theoretical. Australians are seeing the ramifications every single week at the check-out, when the power bills arrive, when the rent is due and when the mortgage payment comes out of their account.

Inflation is now sitting at 3.8 per cent, well above the Reserve Bank's target range. Core inflation remains elevated and higher than that of most other developed economies not because Australians are spending too much but because Labor is. This did not happen by accident. Since Labor came to office, the Reserve Bank has been forced to lift interest rates 13 times as of today. That is the price Australians pay when government spending runs out of control. A family with an average mortgage is now paying around $1,800 more every month than they were before Labor took power. For many households, that is the difference between saving and falling behind. That is the cost of inflation that is allowed to persist.

A government that will not restrain itself has no right to ask Australians to tighten their belts. Australians are paying more for everything. Food prices are up 16 per cent. Rents are up 22 per cent. Insurance is up 39 per cent. Electricity prices are up nearly 40 per cent without rebates. This is not relief. I don't know who says it is, but this is not relief; this is regression. Under Labor, Australians have experienced the worst collapse in living standards in the developed world. That's not something to be proud of. Real wages are lower than when Labor took office. By international comparison, this is the worst decline in the developed world. Small businesses are being hit from all sides. Input costs are rising. Energy prices are higher. Demand is weakening. Some 40,000 businesses have gone insolvent on Labor's watch. Many are family-run businesses that can no longer keep the lights on. When they fail, families lose incomes and workers lose jobs.

The common thread running through all of this is—surprise, surprise—spending. Labor's government spending is now at its highest level outside of a recession in 40 years, growing from 24 per cent to around 27 per cent of GDP. Debt is on track to hit $1.2 trillion. Interest on that debt now costs taxpayers $50,000 every minute. Every dollar spent servicing debt is a dollar taken from Australian families.

Housing has become a major driver of inflation, and government failure is making it worse. Supply is near its lowest level in a decade. The result is higher prices, higher rents and fewer opportunities for young Australians to own a home. Australians are not asking for short cuts; they are asking for a government that understands aspiration and respects effort. They want small businesses treated as the backbone of the economy, not as an ATM. A core responsibility of any government is to protect the living standards of its people, and this government has failed that test. This Labor government's cost-of-living crisis is exactly that—it is a crisis.

A government that spends without restraint today steals opportunity from the next generation. When Labor spending runs out of control, Australians are paying, families are paying, small businesses are paying and, unless this government changes course, future generations will pay the price. That is why this urgency motion must be debated and why Australians are watching how this government votes today. (Time expired)

Karen Grogan (SA, Australian Labor Party) Share this | Link to this | Hansard source

I'd like to thank Senator Paterson. I know there's a lot going on on the far side of this chamber and a lot going on behind the scenes as they try and work out who they are. But, while those opposite are fighting amongst themselves, focusing entirely upon themselves, on this side of the chamber, the Albanese Labor government is focusing on Australians. It's focusing on real, practical things that need to occur to make things better for people on the ground, who are doing it tough. We recognise that people are indeed under quite a lot of pressure, and we have done so ever since we were elected in 2022. But we are doing something about it.

We brought in tax cuts—tax cuts last year, tax cuts this year and tax cuts the year after that. We're slashing student debt, making it easier for our next generation to build themselves for the careers they need to give them the stability to build their future. We've made significant changes in the health space, with more urgent care clinics and cheaper medicine and better opportunities for people to be the healthiest they can be, to rely on Medicare when they need it, to be able to afford the medicines that they need and to be able to afford to see a doctor when they need to. These are the things that are genuinely making a difference to the hip pockets of every single Australian out there.

The MYEFO showed, just a couple of months ago, that the budget is now more than $233 billion better off than it was when we inherited it. Yet, from listening to those over there, you'd think that things had got worse. No, no—in terms of how we're doing economically and in terms of managing how things are going, we are doing much better. We've found more than $114 billion in savings. We have a serious policy, we have a serious plan, and we're rolling it out, while, all the time, every single thing we do in this chamber is a huge fight for those opposite and for those on the crossbench. Maybe it's just a vibe—fighting behind the scenes, fighting in their party rooms, fighting in the corridors and fighting in here. Maybe they don't know how to do it any other way. But over here we are focused on Australians. We are focused on making things better for people out there who are doing it tough. They had ten years—ten long years. When we came to government inflation was at 6.1 per cent and rising, and it is now lower. They left us with higher spending, no savings and bigger deficits. We are going about the process of fixing that. Year on year, budget on budget, we are making a difference.

We're not ignoring the housing problem; we're getting on with the job. I'd like to draw attention to the announcement on the weekend in South Australia, where we had the Albanese Labor government and the Malinauskas Labor government coming together to sign a historic deal that is going to make a fundamental difference to housing access in South Australia—$800 million. That money will not just build houses; it's going towards things like concessional loans so that we can build the water and sewerage infrastructure that we need to be able to expand our housing developments.

Over there, they say nothing's been built. Well, there were 373 houses in a decade under the opposition, as they stand now. I would say that we are beating that, hands down. We've had 10 years of ignoring housing and ignoring what the need is into the future to house our population and ensure the future of our young people. In South Australia, we will be seeing enormous development. With some of that housing being managed under this new deal that was signed on the weekend, people will be moving in as soon as 2027-28. We are making a fundamental difference. We are dealing with the things that matter to people on the ground. Those opposite wasted a decade and left us in an untenable situation in terms of the housing in this country.

Sean Bell (NSW, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

The Albanese Labor government has failed to control interest rates. As a result of Labor's reckless spending, Australians will be dealing with higher inflation for longer, and Australian families will pay the price. Today, the Reserve Bank lifted interest rates by 25 basis points, and that means mortgage repayments will jump by around $1,000 extra per year for a $500,000 mortgage. For families across NSW and Australia already struggling with groceries, fuel, rent and power prices, this is a cruel blow—another hit to the household budget from a Labor government that is totally out of touch. While groceries, rent, fuel and power keep climbing, Labor keeps spending. Labor keep pushing their devastating net zero ideology, and Labor keep driving mass immigration higher and higher.

Families are hurting, mortgage holders are stretched to the limit, home buyers are being locked out of the market, and renters are being crushed under the mistakes of this terrible Albanese Labor government. This Labor economy is failing everyday Australians. One Nation is the only party here with a real plan to rebuild Australia for Australians, because One Nation will cut electricity prices by scrapping Labor's net zero agenda and backing reliable coal-fired power, One Nation will end mass immigration to ease pressure on housing, infrastructure and essential services, and One Nation will slash government waste, pay down debt and make sure that your taxpayer dollars are spent where they're needed. One Nation will not allow Labor to continue to inflict this economic pain on Australians. We will hold them to account. One Nation is united. We are ready. We will put everyday Australians first every single— (Time expired)

Fatima Payman (WA, Australia's Voice) Share this | Link to this | Hansard source

The first Tuesday of most months is like judgement day for many Australian families out there who are just waiting for the decision of the RBA, and it's unfortunate that we're seeing another rate rise. What Australian families out there are feeling—it's not just through spreadsheets; it's when they see their direct debit mortgage payments come out. As we're hearing from everyone across the chamber, housing is a massive issue. Clearly, more needs to be done. The supply issue needs to be addressed. I've been hearing from my own constituents that the government needs to do something about negative gearing—anything. The capital gains tax discount needs to be addressed as well. Now, these are very simple solutions alongside the supply issue that we're all talking about. I think they're easy fixes. We can't let this continue to pinch Australian families.

Dave Sharma (NSW, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Link to this | Hansard source

An average sized Sydney mortgage holder is going to be paying $2,070 in extra interest per year because of the RBA's decision today to raise rates by 25 basis points. It was only one year ago that the Treasurer, Jim Chalmers, told us:

The worst of the inflation challenge is now well and truly behind us.

That was in January 2025. And it was only six months ago that Anthony Albanese, the Prime Minister, said:

We have turned the corner there with inflation …

That was in July 2025, six months ago. Yet what we have seen in the last four months is inflation in Australia accelerating. It was 3.8 per cent last month at an annualised rate, significantly higher than the previous month's figures, well outside the RBA's target band and, importantly, heading in the opposite direction to the rest of the world. Inflation in the United States is 2.7 per cent and coming down. Inflation in the Eurozone is two per cent and level. Inflation in the UK is 3.4 per cent and coming down. In Canada, it's 2.4 per cent and falling. In Japan, it's 2.1 per cent and falling. In Germany, it's 1.8 per cent and falling. But in Australia inflation is going up. That is why the Reserve Bank is having to raise interest rates.

Now, this isn't the first time, of course. By my count, anyway, this is the 13th rate rise that happened under the Anthony Albanese led Labor government, whilst there's been only one rate cut. What that means is that householders with an average size mortgage in Sydney today are paying $2,000 more in interest a year because of this decision, but they're also paying thousands of dollars a year more because of previous RBA decisions. You are paying more interest, but you're also paying more in taxes because salary earners have been progressively pushed into high-income tax brackets by high inflation, by bracket creep, by this Anthony Albanese government. And you are paying more for goods and services. High inflation means that the price of things is rising at a fast rate. Whether it's food, whether it's electricity, whether it's school fees, whether it's rent, whether it's housing, whether it's utilities, whether it's insurance or meat, fruit and vegetables or school uniforms, all of these things are rising in double digits or high single digits on a yearly basis. If you are a householder in Australia, under this government you're paying more in interest, you're paying more in taxes, you're paying more for life's everyday essentials. That is a trifecta of economic policy failure to have every household in Australia basically worse off.

The government will dispute, and has disputed today, that they have anything to do with this. They say it's not their problem. In their first two years in office they blamed post-COVID supply chain hangovers. They blamed the war in Ukraine. They blamed the commodity price surges. They blamed trade and tariff uncertainties. But the truth is that the rest of the world have gotten on top of inflation. Other central banks around the world are cutting interest rates; it's only our central bank that is increasing interest rates. Only Australia—a unique outlier in all the worst respects.

The government would have you believe that this has nothing to do with their spending. Well, let's just look at what the experts say. We have AMP economist Shane Oliver saying:

The best thing that Australian governments can do to help bring down inflation would be to cut government spending back to more normal levels.

He's not the only one. Government spending at the moment, you would note, is 26.9 per cent of GDP, the highest level of government outlay in 40 years, outside of the pandemic. In the budget papers last year we had government spending growing at four times the rate of the economy. If you have more public money, more government spending competing with the private sector for a finite supply of goods and services and capital labour, it's going to do two things. Firstly, it's going to crowd out the private sector, and we've seen that. The private sector is struggling to attract workers, it is deterred from investing, it can't access capital and it's not investing in the future. Secondly, it's going to push up prices, and that's exactly what we've seen. IFM Investor's chief economist, Alex Joiner, has said that the 'fiscal guardrails have come off'.

If you want to know why Australia alone amongst developed countries has inflation going up, and if you want to know why Australia alone amongst developed countries has its central bank raising interest rates, look to the government, look to their profligate spending, look to their lack of fiscal discipline, look to their abolition of fiscal guardrails.

Karen Grogan (SA, Australian Labor Party) Share this | Link to this | Hansard source

The question is that the motion moved by Senator Paterson be agreed to.