Brian Mitchell (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. How is the Albanese Labor government's responsible economic management right for the conditions that we confront, and what approaches have been rejected?

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

Thanks to the honourable member for his question. Since the parliament last sat, we got inflation data which showed that underlying inflation, monthly inflation and non-tradeable inflation all continue to moderate. We also got new numbers last week in the national accounts. What that showed is that the economy barely grew in the June quarter—0.2 per cent and one per cent through the year. That is the slowest growth in our economy since 2020. The basic story of the national accounts was that weaknesses in the household part of the national accounts and private investment were offset by exports and public final demand.

The weakness in our economy is the inevitable consequence of three things: firstly, global economic uncertainty; secondly, persistent price pressures in our economy; and, thirdly, the impact of higher interest rates on our economy. The main take-out was that consumption is going backwards in our economy right now, discretionary spending fell substantially and household saving is very low. These are all signs, as we know—or at least this side of the House understands—that people are doing it tough, and that's why our cost-of-living help is so important and why it's so important that household incomes grew in the most recent numbers.

As I said earlier, those opposite don't support cost-of-living help. They want higher interest rates. They want a recession for political reasons, and they were very disappointed when they didn't get one.

Hon. Members:

Honourable members interjecting—

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

We know this by their reaction right now and we know this from their reaction last week. We also know that, if we had followed their advice, we'd be in recession right now, and we're not. This side of the House is fighting inflation without ignoring the risks to growth and fighting inflation while recognising the pressures that people are under. We're getting the balance right—budget repair, cleaning up the mess that we inherited from those opposite, turning big Liberal deficits into big Labor surpluses, rolling out cost-of-living help, helping in the fight against inflation and investing in housing, skills and energy and in a future made in Australia.

While two-thirds of the OECD have had at least one negative quarter in recent times, we are managing the economy responsibly. We're rolling out that cost-of-living help, and we're avoiding recession. Here, there's a very important contrast. The Australian people know that we're helping them with the cost of living, we're fighting inflation, we're cleaning up the budget, and we're investing in the future. But we are in the third year of a three-year parliamentary term, and those opposite still have no credible or costed economic policies to speak of. They won't come clean on what their $315 billion in cuts will do to push our economy into recession and what they mean for Medicare, for pensions and payments or for the other services that Australians rely on. (Time expired)

Sussan Ley (Farrer, Liberal Party, Shadow Minister for Women) Share this | Link to this | Hansard source

My question is to the Treasurer. Last week the Treasurer accused the RBA of 'smashing the economy'. Then Labor's national president and the Treasurer's mentor, Wayne Swan, said the RBA is 'punching itself in the face'. Treasurer, why does the Albanese Labor government think it's acceptable to bully the independent RBA in this way when all they're doing is cleaning up Labor's economic mess? Why is the government fighting the Reserve Bank of Australia while Australian families go backwards?

Rob Mitchell (McEwen, Australian Labor Party) Share this | Link to this | Hansard source

Wayne Swan's not in the parliament, mate.

Milton Dick (Speaker) Share this | Link to this | Hansard source

The member for McEwen is warned. I'm not particularly happy with some of the language in that question. I'm going to ask the deputy leader to state the question again. I just want to make sure it's within the standing orders.

Sussan Ley (Farrer, Liberal Party, Shadow Minister for Women) Share this | Link to this | Hansard source

Last week the Treasurer accused the RBA of 'smashing the economy'. Then Labor's national president and the Treasurer's mentor, Wayne Swan, said the RBA is 'punching itself in the face'. Treasurer, why does the Albanese Labor government think it's acceptable to bully the independent RBA in this way when all they're doing is cleaning up Labor's economic mess? Why is the government fighting the Reserve Bank while Australian families go backwards?

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

There are a number of elements to the question. First of all, the Governor of the Reserve Bank doesn't consider it the way that the deputy leader has said. That's the first point. She made that clear. She said it last week, and those opposite—

Opposition Members:

Opposition members interjecting—

Milton Dick (Speaker) Share this | Link to this | Hansard source

Order! The Treasurer will pause. There's far too much noise on my left. The deputy was given the courtesy. I want to hear the answer. This noise is not going to continue; otherwise, we won't be here. The Treasurer has the call.

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

The governor made it clear last week in her public comments that she doesn't agree with the assessment put forward by the deputy leader. The second point I'm asked about is cleaning up the mess. It's ironic when you consider the mess that we inherited—turning those deficits to surpluses and getting real wages moving again. Inflation is half of what its peak was in the year that we were elected.

In terms of the rest of the question, it is self-evident—it is a factual point—to say that a combination of global economic uncertainty, persistent price pressures and higher interest rates are slowing our economy. If those opposite don't agree with that, they don't know the first thing about the economy. I say to the deputy leader: don't take your economic advice from the shadow Treasurer, because everybody who looks at this objectively and factually knows that higher interest rates are slowing our economy. We saw it in the numbers for consumption, discretionary spending, households and dwellings, and we saw it in a number of indicators in the national accounts.

More broadly, when it comes to the fight against inflation, I take responsibility for our part of the fight against inflation. I take responsibility for surpluses, when those opposite only ever delivered deficits. I take responsibility for $80 billion in savings, when those opposite had none in their last budget. I take responsibility for banking almost all of the upward revisions to revenue, when those opposite spent most of it. I take responsibility for helping inflation moderate further, after we inherited much higher inflation from those opposite and it was still going up. I take responsibility for helping the Reserve Bank governor fight inflation without ignoring the risks to growth.

I won't be taking lectures from those opposite, who left us huge deficits and a trillion dollars in debt. They left us with inflation with a six in front of it—and rising. It's the same people who cheer for higher interest rates and a recession because it serves their political interests, the same people who would have us in recession right now but with no help for people who are doing it tough on lower wages, the same people who can't tell us where those $315 billion in secret cuts are coming from and the same people who don't have a costed or credible alternative economic policy.

As the Governor of the Reserve Bank said last week, the government and the governor are aligned when it comes to the fight against inflation. We've got the same objective, but we've got different responsibilities. I take responsibility for our part in the fight against inflation. We are making welcome progress, since inflation was north of six per cent when you were in office.