Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Hansard source

I thank Senator Babet for the question and also for his advice that he would be asking a question relating to debt and inflation. I would agree with Senator Babet that a lot of the significant increase in government debt under the former government—they doubled the debt before the pandemic hit—has led to the budget being in worse shape than it needed to be, that there wasn't enough to show for the debt that we currently carry and that the fastest growing area in the budget is managing the interest burden on that debt. So, it is a big problem and it is a big issue that we are having to manage as we work our way through the decisions we're taking in this budget.

The inflation challenge has certainly been made worse by the failure in energy policy. Nine years of failure to deal with the reality of a changing energy market and the fact that we haven't been able to be ahead of that and have policies in place to deal with it has certainly contributed. One of the biggest contributors to inflation of course has been energy prices, impacted by the war in Ukraine but absolutely also impacted by the failure of those opposite to land an agreed energy policy—22 of them, and not one of them landed. The fact that we are now dealing with the results of that has certainly had an impact on inflation, which is why we took the steps we took at the end of last year to put caps in place, to put in place the interventions that we did, as unusual as they were, to make sure we were putting downward pressure on inflation and bills at the same time. (Time expired)