Dean Smith (WA, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Hansard source

The test for Labor in tonight's federal budget is a simple one, and it's also a familiar one. Will the budget tonight hurt or help Australian families? Will the budget tonight hurt or help Australian businesses? The harsh reality at the moment is that Australian families and Australian businesses are already reeling under the pain and the hurt of Labor's two previous budgets. These budgets have made Australians poorer and they've made Australia weaker. After a commitment to wage a war on inflation, inflation remains perilously high. After promises to make Australian families better off, families are struggling under the weight of having to find an extra $24,000 a year on an average home loan in order to meet escalating interest rate costs. Families are struggling to keep their heads above water. The data points in the economy make it very clear: things have got worse for Australian families under Labor; they've not got better. But Australian families don't need to look at the data, because they feel it and they see it for themselves when they go to fill up their car with petrol and when they're shopping, walking through the supermarket aisles.

So when Anthony Albanese says, as he has over the last few days, that this will be a traditional Labor budget, Australian families and Australian businesses should be alert and they should be alarmed, because we know what a traditional Labor budget means. It means higher taxes and it means higher spending. Higher taxes and higher spending budgets are bad for Australian families, and higher spending budgets will do nothing to tame the war that we need to wage on inflation.

Yesterday there emerged a very important matter—indeed, a credibility gap in regard to what the Treasurer, Dr Chalmers, has been saying and what the Reserve Bank has been saying. Yesterday Dr Chalmers said that, under the government's predictions, it expects inflation to return to the RBA range of two to three per cent by the end of this year. The government believes that inflation will fall to 2.75 per cent by December this year. In contrast, the Reserve Bank of Australia is saying that it expects inflation to stay at 3.8 per cent until the end of this year and not fall to three per cent until December next year. This is a serious credibility issue for Dr Chalmers when he stands up in the House of Representatives tonight and presents this Labor government's third budget. Dr Chalmers is not just the Treasurer of this country; Dr Chalmers is now the king of wishful thinking. So tonight, when the Treasurer gets to his feet, he has some very important explaining to do.

We should be very mindful that inflation, which is ruining household incomes, which is ruining household savings and which is making life very difficult for small businesses in our country, will not be mitigated, will not fall, unless the government has the courage to show some constraint—not just some constraint but real, genuine constraint—when it comes to government spending, because the reality now is that inflation is still perilously high, the government is losing the war on inflation and the commentators are telling us that inflation is now home grown, meaning it's the government's responsibility, and it's sticky, meaning it's not going away in a hurry. Labor's third budget, I fear, will hurt Australian families and hurt Australian businesses more.