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

I acknowledge and thank the member for Reid for her work to ensure that everyone, every taxpayer in her electorate, gets a tax cut on 1 July and every household gets energy bill relief as well.

Today's national accounts did confirm that growth in our economy was flat in the first three months of the year. It barely grew in the March quarter—just 0.1 per cent and 1.1 per cent through the year—but any growth in these circumstances is welcome. Over the past year around three-quarters of OECD economies have recorded a negative quarter, but Australia hasn't. The numbers came in broadly as the market expected, perhaps a little bit weaker. Certainly, we were expecting very soft conditions at the start of the year, and that's what we see in these numbers.

As I said before, there's lots of commentary about the budget settings. Some of it's objective, some of it's partisan, some of it's right and some of it is now clearly and embarrassingly wrong. Today's numbers make it really clear that to slash and burn, as those opposite and others called for, would have been diabolical in these circumstances. These national accounts show we got the budget settings right. They justify our approach to fighting inflation and repairing the budget without smashing the economy when growth was already soft and the people were already under pressure. They completely vindicate our strategy to repair the budget and to provide cost-of-living help at the same time.

The RBA Governor made it clear today that our two surpluses are already helping in the fight against inflation. At the same time we're supporting people with tax cuts and energy bill rebates and cheaper medicine. We're helping with rent and student debt as well. And the consumption numbers back in this approach. Household consumption was soft, growing by 0.4 per cent in the quarter and below its decade average for five quarters now. There was a big focus on essential spending at the household level growing faster than discretionary spending, which barely grew in annual terms. Household disposable income was up 1.1 per cent in the quarter and 5.2 per cent through the year, and there are more wage rises coming because of the excellent decision taken by the Fair Work Commission.

There are no shortages of challenges laid bare in the national accounts, but, more than just acknowledging them, we are acting on them, we are anticipating them, we are responding to them in the budget that was handed down not that long ago. And we still have advantages: moderating inflation, real wages growth, low unemployment and stronger public finances. Our responsible and methodical and measured approach to the budget is keeping pressure off inflation without crunching the economy. Today's data confirms that that responsible fiscal strategy is exactly right for this combination of challenges that we confront together in our economy.

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