Andrew Charlton (Parramatta, Australian Labor Party) Share this | Hansard source

I thank the mover of this motion because many Australians are struggling with cost-of-living pressures and feeling the effects of inflation. Inflation takes the most from those who have the least to give. It hurts people who can't make their budget stretch any further. It hurts first home buyers who can't pay high interest rates or who are struggling with rent. It hurts people already experiencing low wages growth over the last 10 years. Nowhere is this more obvious than in my electorate, where financial pressures are palpable. Parramatta Mission's daily meals program saw an increased uptake of more than 100 per cent over the past year. Food parcel uptake was up nearly 200 per cent in that same period, and Centrelink referrals have more than tripled.

This is the front line of the inflation challenge in Australia. The problem is serious, but, unfortunately, the motion put by those opposite is not serious. They don't seek to grapple with the causes of inflation and they don't seek to provide any sensible alternatives on how to deal with it. The first part of this motion notes 'that the government has failed to tame inflation'. Saying that the government has failed to tame inflation is a bit like the arsonist asking the fire brigade why it took them so long to put the fire out, because inflation was caused by the Liberals.

Inflation increased in the last two years of the Liberal term. It was running at 3½ per cent in the fourth quarter of 2021 and, by the time they left office, it had risen each quarter: from 3.5 per cent to 5.1 per cent to 6.1 per cent to 7.3 per cent and finally to 7.8 per cent. In the last year of the Liberal government, inflation was on the escalator going up quarter after quarter, getting worse and worse. They left the inflation problem that this government has had to deal with.

Why did it go up so much? Why did the Liberals increase inflation so much as to leave it at the highest rate that it had been in Australia in decades? The answer is that they had the most expansionary budgets in Australia's peacetime history. They wasted billions of dollars on JobKeeper, the worst targeted program in Australia's economic history, subsidising businesses that were fine, subsidising businesses that had profits going up and subsidising businesses that were employing more people and posting record returns. Treasury analysis shows that JobKeeper wasted $50 billion. It was paid to Harvey Norman, private schools, Qantas and hundreds of companies that did not need it.

They put an enormous amount of money into the Australian economy that stoked the inflation fire. As I said, it increased it from 3.5 per cent to 7.8 per cent. The reason inflation is high in Australia is the fiscal profligacy of those opposite. Not only did they not deliver a budget surplus but they did not get within a bull's roar of a budget surplus.

The second part of this motion talks about interest rates. It says that interest rates have already gone down in the United States and the United Kingdom. I have a couple of things on this. Firstly, interest rates in the United Kingdom and the United States are higher than they are in Australia. Interest rates in both the UK and the US are 4.75 per cent—higher than rates in Australia. Secondly, when we look at the record, Australia has actually had a smaller increase in inflation overall than in all of those other countries.

The opposition are continually saying that inflation is coming down in these other countries. They had cumulatively more inflation than Australia has experienced. The UK, from the latest figures back to 2020, had 25 points of increased inflation, the USA had 24 points and New Zealand had 23 points. By contrast, Australia, over that same period, had just 20 points increase. We had a lower increase in overall price level than all of the three countries mentioned in this motion. And the reason we had a smaller increase in the price level than all of the countries that the opposition mentions in this motion is that we have delivered the fiscal discipline in order to bring inflation back down. In fact, we've more than halved the inflation that they left us with.

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