Daniel Mulino (Fraser, Australian Labor Party) Share this | Hansard source

This is the right budget for the times. It is a budget that continues to put downward pressure on inflation but does so in a responsible way which provides much-needed assistance, in a well calibrated way, to those who need it most. Those opposite speak of an alternative approach, an approach built around austerity. They keep speaking about a budget with hundreds of billions of dollars of too much spending when the vast majority of the dollars that they speak of is for indexation of core services like the age pension or core public services. It really is incumbent on those opposite to clarify which core services they will cut and which benefits they won't see increased if they're going to continue on this line of austerity. The continued calls for austerity when people are doing it tough make me think that the opposition are like the 1990s IMF but without any economics PhDs.

The inflation that Australia has experienced over recent years is a global phenomenon. It came from global supply chains seizing up after COVID and from the war in Ukraine pushing up energy prices. In Australia, after that global inflation hit our shores, we have seen a significant reduction in inflation over the last two years through a combination of monetary and fiscal policy working together and well calibrated and well targeted cost-of-living supports. We've seen two surpluses delivered successively in that time, we've seen a $200 billion turnaround in the government's fiscal position relative to what we inherited, and we've seen significant savings identified in successive budgets—three budgets in a row—versus zero dollars in savings identified by those opposite.

Inflation remains above the band of two to three per cent, but it needs to be acknowledged that it has come down significantly. In annual terms, it has come down from 7.8 per cent at its peak to 3.6 per cent in the last quarterly reading. In monthly terms, it has come down significantly, from a peak of just over eight per cent in late 2022 to under four per cent now. This significant decrease in inflation has been driven by a reduction in goods inflation, and we are now also seeing a reduction in services inflation, which peaked at a later time but is now also easing. The government's strategy is working. Based on Treasury modelling, inflation could return to the target band by the end of 2024.

But we have more work to do. We know people are still doing it tough. We know inflation is still higher than it should be. But this budget is aimed, firstly, at putting further downward pressure on inflation through responsible fiscal settings that see us, as I mentioned, having another surplus. But this budget also responds to the fact that people are doing it tough by providing those who need it most with assistance.

The most critical measure that provides people with that assistance is the amendments to the stage 3 tax cuts, which provide millions of people with bigger tax cuts than they would have otherwise had. The starkest comparison is for those on incomes of $18,000 to $45,000, who will receive more than $800 a year in tax cuts under us, versus absolutely nothing under the tax cuts proposed by the opposition. This is a huge difference. In my own electorate, where people are doing it tough and talk to me about it constantly, 87 per cent of taxpayers will do materially better under our tax cuts compared with those the opposition put forward. The opposition complained about our tax cuts in parliament and reluctantly voted for them. What is it that they actually put forward as their plan?

In addition, there's $7.8 billion in cost-of-living relief, including a $300 energy bill rebate for households and a $325 rebate for small businesses. We're increasing maximum rates of Commonwealth rent assistance, making this the first time in a long time that there's been a second successive increase in Commonwealth rent assistance. Then there's the raft of measures that provide for cheaper medicines, something that is making a huge difference for people in my electorate, where there has already been well over $1 million in savings from cheaper medicines.

So, this is the budget for the times. It is a budget that continues to put downward pressure on inflation. This is a budget that will see us move closer towards the band we need to be in. But while we're on that journey the budget will provide those in the community who are the most vulnerable with the assistance they need.

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