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

Senator Dean Smith has submitted a proposal under standing order 75, today, which has been circulated and is shown on the Dynamic Red.

Pursuant to standing order 75, I propose that the following matter of public importance be submitted to the Senate for discussion:

"The Albanese Labor Government is presiding over the largest decline in living standards in the developed world, driving up inflation through record spending and nearly $1 trillion in debt, and leaving Australian families worse off with falling real wages and higher interest rates."

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.

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

This afternoon, we are going to debate this: the Albanese Labor government is presiding over the largest decline in living standard in the developed world, driving up inflation through record spending and nearly $1 trillion in debt, and the consequence is that Australian families are worse off having to deal with falling wages and higher interest rates.

It's worth reminding ourselves why it is that inflation is such a menace. You would have thought that the Labor Party, traditionally the party of working families, would be highly attuned to the menace, to the risk, that inflation causes to families, to businesses and to the economy. It is a menace because it reduces people's purchasing power. It is a menace because it disproportionately affects low-income households. It's a menace because it creates economic uncertainty and makes it harder for families to plan and to save, for businesses to plan and to save, and for businesses to grow.

Inflation is not an abstract statistic. It is the weekly grocery bill that keeps creeping higher. It is rent and mortgage repayments swallowing more of household income. It is electricity, healthcare and insurance costs all rising faster than wages. Earlier this month, it was another interest rate rise. Labor promised Australians interest rates would not need to rise again. Instead of confronting the economic reality, the government prefers to operate in a state of denial. Ministers complain that this is not a high-spending government and some ministers even tried to rewrite history by blaming the Howard government. But their own budget papers tell a stark truth. Under Labor, this government is clocking up record spending. Commonwealth spending has reached 26.2 per cent of GDP under this Labor government. That makes it the highest-spending federal government outside the pandemic in 40 years. Just think about that—the highest-spending federal government outside of the pandemic experience in 40 years. Let's just think about that by way of comparison. During the Howard government, spending peaked at 25.1 per cent and fell to 23.2 per cent when they left office. Let's compare this Labor government with the final Keating Labor budget—25.6 per cent, still lower than this Labor government. What does the Treasury project? The Treasury projects that spending will rise further, to 26.9 per cent in coming years.

This is not temporary; this is structural. This is a government who wants to deny that increasing government spending leads to inflationary pressures in the economy, which forces the RBA to raise interest rates. Who suffers? The people that suffer are Australian families and Australian businesses—the very same people who, in 2022 and 2025, trusted the Labor Party to look after their future. That trust has been betrayed; that trust has been broken.

ABS data confirms what Australians already know from their lived experience. That is that inflation is rising again. Headline inflation is 3.8 per cent. The trimmed mean inflation is 3.3 per cent, above the RBA target. Price pressures are broad. Everyone is experiencing them. Food is up 3½ per cent. Housing is up 5½ per cent. Health is up 3.6 per cent. Now the world deals with an international crisis—one that will negatively impact inflation, one that will negatively impact interest rates. 2026 is going to be a dark year for Australian families and Australian businesses. Guess what? If Labor had been more prudent over the last four years and worked harder to tackle inflation, our country would be in a better position. It is not in a better position; it is in a worse position, and Australian families are going to— (Time expired)

Michelle Ananda-Rajah (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Australia faces a productivity challenge that has been decades in the making. This obviously has implications. It has implications on our standards of living, on our wages and on our long-term prosperity. This productivity challenge has a direct impact on the inflationary problem that we're currently facing. We do have a stubborn inflationary problem, and it obviously impacts the cost of living, which has a direct effect on Australian households and small businesses, as well as large businesses—in fact, right across our economy.

But those opposite would have us believe that government spending is fuelling inflation. In fact, at the heart of this inflationary problem is a productivity challenge, and they know it. They know it, but they did nothing about it when they were in government. In fact, the decade of government under the Liberals and the Nationals was the lowest period of productivity growth in 60 years. That's on them. Then they stand here and have the temerity to lecture the rest of us as if we've somehow had a lobotomy and forgotten about history. Well, that is economic history.

In addition, in the first term of the Albanese Labor government, they had every opportunity to support a huge suite of cost-of-living measures that we introduced. We were supporting this economy that we'd inherited and that was on its knees after a decade of Liberal dysfunction and delay on a number of fronts. We were supporting this country as inflation hit six per cent within months of us taking government. Has everyone forgotten that? It almost hit eight per cent at the end of that year. We brought in a range of measures, and we delivered, thanks to the enormous work of our Treasurer and Prime Minister, a soft landing. But, in this second term, we have seen what the neglect of productivity has done over many decades. That is why it is at the heart of our economic agenda. Our May budget will be focused on productivity. The Treasurer and the Prime Minister have said so.

While those opposite believe that productivity means working longer hours for less, we take a completely opposite view. We see this productivity challenge as an opportunity to invest in our people and their skills—like through free TAFE, which has seen over 725,000 enrolments Thirty per cent of those enrolments are actually in regional Australia. This is a story of regional Australia. Our young people, and older people, are deciding to reskill, for jobs that will deliver security, will be well paid and are going to be immune to the disruption caused by the AI wave that we know is coming.

In addition, we have supported Australians by strengthening Medicare. We saw a historic injection of $8½ billion into Medicare in November last year. We have seen a huge uptick in the number of practices that are now bulk-billing. Before this investment, there were about 1,600 practices that were bulk-billing. There are now 3,400. You will find one in your community. Go to healthdirect.com and have a look. You will almost certainly find a bulk-billing clinic in your community. And that's not all. There have been 130 urgent care clinics, now visited by 2.6 million Australians.

Affordable housing is also at the heart of our productivity agenda. There's no getting around this. We have to deliver housing. Businesses cannot function without workers living near their place of work. It has a huge cost-of-living impact on Australians if they are having to commute long distances, paying tolls and paying for fuel et cetera. That is why we have invested heavily in a housing agenda which is $43 billion. It's a sprawling agenda. And one of the golden, bright points of light in that agenda has been the five per cent home deposit scheme. Two hundred and twenty thousand Australians have taken up that scheme. Two-thirds of those buyers are under the age of 35, and over half of them are singles. This scheme is delivering the great Australian dream, which has been out of range for so many Australians for too long. This is at the heart of our productivity agenda and feeds directly into cost-of-living relief. (Time expired)

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

Today, Treasurer Chalmers has taken to social media to claim credit for the 2.6 per cent increase in annual GDP, calling the rise the strongest growth in the Australian economy for three years. Has the Treasurer forgotten he's been in office for almost four years—meaning the Treasurer took over the economy and made it worse!

Putting that aside, how did the Treasurer create this increase? To haul GDP out of negative territory, the Treasurer has spent like a drunken sailor. Almost all of the increase in employment and economic activity in the last year has come from increased government spending, which has to be paid for with? Higher taxes. In effect, the Treasurer has taxed everyday Australians more, and then spent their money faster than the taxpayers would have. As a result, the money supply has expanded 11 per cent in the last year, and our national debt has now passed $1 trillion.

A funny thing about spending other people's money: it eventually runs out. Already, the government is looking for ways to raise taxes. Capital gains tax increases and increased taxes on superannuation are on the agenda. Even worse, the government is selling off the silverware. The sale of Defence Force property has already been announced—$3.5 billion in extra cash. What was once a strategic asset, which didn't add to the money supply, will be cash in the bank for the Treasurer to spend—more solar and wind subsidies; more money to the Taliban. Already this government has given the Taliban $320 million.

Selling off the silverware to keep the GDP out of recession leads straight to even higher inflation than we have now. To counter this inflation, already the Reserve Bank has been forced to increase interest rates. The result will be a loss of spending power for everyday Australians, who will have to spend more of their income on their mortgage or rent. Government spending is approaching 28 per cent of our GDP and is heading to over 30 per cent, which offsets the reductions in private sector spending that have resulted from overregulation and a lack of confidence in this Labor government. In the short term, this approach makes the data look better. In the medium term, inflation spikes, and wage growth goes negative, as it has been for much of the Treasurer's term. If everyday Australians feel like they're going backwards and working harder, it's because they are going backwards—especially if they're paying off a home or renting.

One Nation will solve this vicious cycle of economic decline with our policy to shrink the government to fit the Constitution and to fit our means. One Nation took a policy to the last election to reduce the size of government by $90 billion in our first term. That number, from what we can see from Labor, is now looking much, much bigger than we can save. Our policy will reverse Labor's deficits, stop Labor's inflation, cancel Labor's interest rate rises and leave more money in the pockets of everyday Australians.

Claire Chandler (Tasmania, Liberal Party) Share this | Link to this | Hansard source

The Albanese government's economic mismanagement has left the Australian economy in a very tricky position. We had national accounts data out today which confirm just how tricky that position is, and I will go into that in my contribution today. But I want to frame it within the context of what we are looking at currently.

The Albanese Government's is sitting on a trillion-dollar debt bomb and have zero plans to start repaying that debt. We found from the data that was released today in the national accounts that public demand is at an all-time record share of the economy at 29 per cent. Last financial year, government spending increased four times as fast as the rest of the economy. This financial year, government spending is still increasing twice as fast as the rest of the economy. There is no question that the Labor government is pouring inflation fuel on the debt fire and have no plan to start repaying that debt. They have no plan to reduce the level of government debt to a point where younger Australians, myself included, won't be paying it back with high taxes, if not now then later in our working lives.

Like I said, the Australian Bureau of Statistics today released the national accounts data for the December quarter 2025, the official snapshot of how our economy is actually travelling. Not long after those figures came out, the Treasurer, Dr Chalmers, fronted up to the media. But, listening to that press conference, I did note he barely spent a minute talking about the numbers themselves. He pivoted pretty quickly to talk about other issues of concern. He said in that press conference that stronger, broader growth provides the best foundation to deal with what's coming at us. That sounds reassuring. But he focused on the headline figures, not on what is actually going on underneath.

Here in this chamber today, I want to look a little closer at those numbers that the national accounts are flashing up at us, because they are a very clear warning of the cost-of-living pressures that Australians are facing. These numbers reflect that this financial pressure has not passed, but the government doesn't seem to be paying attention to that. The household saving ratio climbed to 6.9 per cent in the data released today, which is the highest since September 2022. This isn't the behaviour of confident households; it is the behaviour of families who are putting money aside because they're unsure about what lies ahead. Higher mortgage repayments? We've seen plenty of those under this government. Higher rents? Again, plenty of that under this government. Rising cost of insurance? Again, an awful lot of that under this government. And there's ongoing global uncertainty.

Spending tells the same story. Household spending rose just. 0.3 per cent in the quarter. Discretionary spending ticked up 0.4 per cent, helped along by various sales, like Black Friday and Boxing Day, towards the end of last year. But spending on essential goods and services grew only by 0.2 per cent. So, yes, Australians spent a little bit during the sales, as they are well within their rights to do. Overall, growth in consumption is remaining modest, and the rate of savings is rising. Again, that tells us that confidence is fragile. Just look at energy costs. The ABS reports that out-of-pocket spending on electricity, gas and other fuels fell sharply.

But, in the data in the national accounts today, the ABS makes clear that this was largely due to government rebates which were recorded as government expenditure in the national accounts. That distinction matters because, when government pays part of the bill, the underlying cost hasn't disappeared; it has just shifted. This relief today doesn't necessarily mean lower structural costs tomorrow, and we've certainly seen that in the energy market since the Albanese government has been in charge. We cannot forget that relief measures manage a symptom; structural reform fixes the actual problem. If electricity remains expensive to produce and deliver, no amount of short-term assistance is going to fix the underlying problem. If housing supply remains constrained, rents will remain elevated. If productivity growth remains weak, wages cannot sustainably outpace inflation.

As I said from the outset, the Albanese Government's economic mismanagement has left our economy in a very delicate position. Even before the conflict we have seen in Iran this week, inflation and interest rates were rising and forecast to rise further. Whatever impact that crisis has on the economy— (Time expired)

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

The cost of living is biting every Australian out there, and we hear it day in, day out from Western Australians, who I had the pleasure of speaking to outside my office. They were ranking the cost of living and housing as the two biggest issues that are keeping them up at night. This isn't just mums and dads who are trying to put food on the table or a roof over their kids' heads and making sure that they're juggling various priorities of mortgage repayments, transport costs and fuel prices and energy bills but at the same time making sure their kids have a reliable future that isn't subjected to the lack of opportunities that we are seeing, especially when it comes to housing.

Labor, in both the state Labor Party in WA and federally, have massive majorities and can actually push for progressive reforms to ease the cost-of-living pressures on families, yet we have seen literally nothing when it comes to any form of relief to combat increasing groceries, housing, power bills and transport. Australia isn't a poor country. We need to be doing more. We've seen that there have been consistent calls by the Australian Council of Trade Unions for a 25 per cent tax on gas exports. That's one example that the government can actually do something about. We're seeing really nothing. If they want to address the cost of living, there are options there. You've just got to be brave enough. (Time expired)

Corinne Mulholland (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

This MPI is another breathtaking example from a coalition that has learnt nothing from its mistakes. Imagine having the gall to come to this place and lecture anybody on economic management with a record as bad as theirs. This MPI comes straight out of the 'Don't go there, girlfriend' files, but here we are.

The Liberals love to call themselves good economic managers, which is impressive, given the amount of debt that they racked up when they were last in government. They stood in front of the Australian people last year and said: 'Here are our economic policies: billions of dollars on subsidised nuclear plants, thousands of dollars to boozy lunches for the bosses. Let's ban working from home while we're at it!' But, not content with driving themselves into a brick wall, they said,' Let's step on the accelerator.' They said, 'You know what, let's oppose government tax cuts; that'll be popular!'

Compare that with this Labor government. The Albanese Labor government has delivered tax cuts for every Australian taxpayer, with another tax cut due in July this year. Those opposite opposed those tax cuts. They opposed them. The coalition went to the last federal election with a policy to deliver higher taxes for the Australian people. They talk a big game in this place about economic management, but we've got the receipts. The now very leaked copy of the Liberal Party election review called the policies the Liberal Party took to the last election completely incoherent. The Liberal Party election group reviewers went on to say that the coalition's economic policies 'defied the party's values, such as the opposition to an income tax cut.' They don't like to hear it—

Andrew Bragg (NSW, Liberal Party, Shadow Minister for Housing and Homelessness) Share this | Link to this | Hansard source

I'd like to make a point of order. I think these matters are not germane to the MPI.

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

I'm listening carefully, and I believe Senator Mulholland is being relevant.

Corinne Mulholland (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

Thank you very much. Those economic policies defied the party's values, such as the opposition to an income tax cut and the denial of working-from-home arrangements. It's there in black and white. The review goes on to say that as part of the budget the government announced it would provide an income tax cut for low-income workers in 2026-27 as part of its cost-of-living relief. The opposition announced that it would oppose that tax cut on budget night and voted against it when the legislation was introduced. We all know how that turned out. I'm not surprised Senator Bragg doesn't want to hear it, but we've got the receipts, and every time they want to talk about the economy, we're happy to talk about their record.

But let's look at wage rises for Australian workers. When the coalition were last in government, they said low wages were a deliberate design feature of their economic architecture. Almost three million award-wage workers received a 3.5 per cent pay rise last year under this government. And across the life of this government those same workers have received an increase of $9,000. But we haven't stopped there. This government has delivered a historic pay rise for 250,000 aged-care workers, and up to 200,000 early educators are receiving pay rises. Those opposite mocked those pay rises, but we know it's making a real difference. You cannot walk into a lunch room at an aged-care facility or a childcare centre without being told by their workers how much these pay rises mean to them; $100 a week extra is the difference between putting sports shoes on your kids' feet and not. And those opposite mocked it.

Let's go through some other economic achievements of this government: working hard to drive down the cost of living, and 30 per cent off home batteries to permanently cut power bills, with the highest take-up in Queensland, in Liberal held seats: the seats of Wright, Fadden, Longman—the list goes on. And teaching, nursing, social work and midwifery students are now all being paid for their practical placements; 50,000 students are already benefiting from that. We've boosted Medicare, with $1.8 million in extra hospital funding, helping Australians to get the quality affordable health care they deserve. We've expanded the five per cent deposit scheme to all first home buyers; 250,000 Australians, including 50,000 Queenslanders, are now benefiting from that.

But the Liberal Party and the Greens don't like it. We know they don't like this policy. They would much prefer that people were stung with LMI of up to $20,000, $30,000, $40,000 or $50,000, rather than being able to get into a home of their own. They opposed our policy, because they don't want to see Australians get into a home of their own. They want to lecture us on economic policy, and it's a disgrace.

Andrew Bragg (NSW, Liberal Party, Shadow Minister for Housing and Homelessness) Share this | Link to this | Hansard source

This is a very good MPI, because it allows us to consider the failure of the government to deliver on the economy, and that is measured not by me but by the federal budget, delivered by Mr Chalmers, who I think spent more time learning about Paul Keating's communication style than he did about Paul Keating's substantial and positive reforms to Australia. The sad truth is that we're looking at a $36 billion deficit this year and cumulative deficits over the forward estimates of $143 billion as we head towards $1 trillion of debt. Today's accounts show that 38 per cent of the contribution of growth comes from the public sector. There's something wrong at the Reserve Bank, because they don't seem to know this, or they seem to be covering up these facts, when they put out these statements. But it's very clear that the government sector, the public sector, is massively contributing to the economic growth in Australia. That is why it's contributing to inflation and higher interest rates. This is the reality that Australians now have to live with.

I feel sorry for all the Australians who have taken out 95 per cent mortgages, at the behest of this government, that are uncapped. It has been marketing that like a financial product. Those Australians will now have to pay vastly higher amounts in interest costs because of the government's forcing up of interest rates because of their failure to contain inflation because public sector spending is out of control. As I said, there was a $36 billion deficit this year, $143 billion over the forward estimates, on the way to $1 trillion. And Dr. Evil's not even in the building!

We have a massive problem with waste in the country, and if you want to see the waste, come and see this government in action in Canberra. We sit here in this Senate, day in and day out, and nothing happens. There's no passing of legislation. We don't do anything. The government tries to obstruct the opposition from getting access to documents. How shocking it is that we are trying to do the jobs that we are well remunerated to do: getting access to information, exposing maladministration, exposing waste! That's the job—to find out stuff, to work for the people. But, no, don't do that. Don't get to the bottom of anything. Just try to obstruct and obfuscate. That's what we do here in Canberra. It's a huge waste of money.

I take the points that the government speakers have made about housing. The government have had three gimmicks. Let me remind you of the housing scoreboard. After spending $80 billion on housing, the government is giving the country 30,000 fewer houses each year. They've crashed housing construction in this country from 200,000 houses a year on average down to 170,000 houses a year on average. That's the value the country gets from $80 billion.

They've had three gimmicks in these four long years. The first gimmick is the Housing Australia Future Fund. With 10 billion bucks and after 2½ years, apparently it has built about 800 houses, but I'd say most of those have been bought. The second gimmick is five per cent deposits, a free-for-all where the government is underwriting the mortgage insurance of even the wealthiest Australians, and what you now see is a massive uptick in prices for entry-level houses. With their reckless five per cent deposit scheme, which is just pushing up prices, they are hurting the people who are trying to get into the market. With their third gimmick, they're now canvassing the idea of new taxes on housing, because they hate the idea of mums and dads providing rental stock to other Australians. Their solution is to get the institutional investors in to provide rental stock to Australians, because that's their mates.

Ultimately, this is a government for mates. Most of their economic policy is designed for their friends and their vested interests. They want mums and dads out and they want the super funds to be the big corporate landlords. They want them to own the houses. So far, they have three housing gimmicks: the Housing Australia Future Fund that builds no houses; the five per cent deposits, which have been a disaster for young people; and they're now looking at high taxes, which apparently will help build more houses. If you can tell me how more tax will build more houses, then I'm open to that discussion, but so far this is crazy economics from a government which has crashed the budget and crashed the economy, and the Australian people are now paying a very, very heavy price indeed.

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

The time for the discussion has expired.