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

I acknowledge the wonderful service of the member for Calwell over a long period of time in this place and thank her for the question as well. As I said a moment ago, we got new inflation data today which showed that inflation edged down in monthly terms. But at four per cent annually it's still too high. We acknowledge that. Of course we need inflation to be lower sooner. I think that's an objective that we all share. But while we acknowledge that inflation is still too high in our economy we also need acknowledge and remember some important facts which have been lost on those opposite. As I said before—as we've said many times—the monthly numbers bounce around. They don't compare the same goods and services. As I said a moment ago, the experience in other countries is that inflation doesn't always moderate in a straight line and that the last mile is the hardest, and that's why we've seen core inflation go up in Canada and in the euro area as well.

Inflation at 4.0 per cent is too high, but it is much lower than the 6.1 per cent that we inherited from those opposite and it is less than half of its peak a couple of years ago. The other important thing that shouldn't be lost on this House is that inflation would be much higher if we were running our budgets and our economy in the irresponsible and wasteful way that those opposite were carrying on in government. When inflation was higher, and rising, they handed down a budget with $40 billion of new spending and no savings. If budgets are such a key determinant of prices in our economy then they failed their own test when they were in government. Now, inflation would be higher still were it not for the cost-of-living policies that they voted against. In the ABS data today, we find out that electricity was up 6½ per cent, but it would have been 14½ per cent without our energy bill relief. Rents were up 7.4, but they would have gone up 9.3 without our rent assistance. It's why our cost-of-living help is so important, it's why it's so warranted, it's why it's so necessary and it's why it's so timely.

On Monday people will start to get a tax cut and energy bill relief; a pay rise—for people on awards; cheaper medicines; and more weeks of PPL. This is how you deliver cost-of-living relief. Not by pushing up energy prices with nuclear reactors. Today's inflation figures were another reminder of the pressures that people are under that we acknowledge and that we are responding to, and another important reminder of just how crucial it is that we help people with the cost of living and that we do that in five days' time in all the ways that we've talked about. At the same time as we turn big Liberal deficits into Labor surpluses in a way that the Governor of the Reserve Bank says is helping in the fight against inflation.

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