James McGrath (Queensland, Liberal National Party, Shadow Assistant Minister to the Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer, Senator Gallagher. The release earlier today of minutes from the last Reserve Bank board meeting showed that the board assessed 'finely balanced arguments' but decided just three weeks after the Albanese government's second budget on a 12th interest rate increase. How could Labor's expansionary budget, which included $185 million of new spending, have done anything other than tip the balance in favour of another interest rate increase, leaving Australians facing the highest RBA cash rate in 12 years?

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

I thank Senator McGrath for the question. I also note that in the minutes released it said:

Members noted that the new policies announced in the Australian Government Budget had not had a material effect on the staff forecasts for economic activity and inflation.

…   …   …

Members observed that it was understandable that the lowest paid workers would be compensated for high inflation …

There was a whole range of issues noted in this statement, but, consistent with the evidence that the governor gave at estimates and consistent with the evidence that the Secretary of Treasury gave at estimates, the budget actually took pressure off inflation—and it did so through the Energy Price Relief Plan, which those opposite opposed.

This was a carefully calibrated budget. We had to do a number of things in this budget. We had to clean up some of the terminating measures that were dropping off, where funding wasn't going to be provided any longer. We had to provide cost-of-living relief, where we could—where we could make investments into Medicare and the care economy, where we could support women, and where we could also make sensible investments into those growth opportunities for the future but where those investments didn't add to inflation. The evidence from economists, the evidence from the governor, the evidence from the Secretary of Treasury, the detailed budget papers—all of that is consistent with the minutes that have been released today.

Inflation is the key economic challenge. We understand how it impacts on households, and how interest rates impact on households, but also how high prices impact on households, which is why it's so important that the budget works alongside the efforts of the Reserve Bank to bring the inflation rate back to the target range, which is exactly what this budget sought to do.

Sue Lines (President) Share this | Link to this | Hansard source

Senator McGrath, a first supplementary question?

James McGrath (Queensland, Liberal National Party, Shadow Assistant Minister to the Leader of the Opposition) Share this | Link to this | Hansard source

With inflation having a seven in front of it for three quarters under the Albanese government, and cost of living running out of control, how could Labor's removal from the budget fiscal strategy of the objective to immediately address inflation have done anything other than tip the balance in favour of another interest rate increase, leaving Australians facing the highest RBA cash rate in 12 years?

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

Well, of course, the highest quarter of inflation was in the March quarter of last year, which actually was the end of your government, and the interest rate increases that we've seen commenced under your government. They are the facts. And what Australians know is that they have a government that is focused—

Honourable senators interjecting—

Murray Watt (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

The old caretaker argument: we didn't have a government.

Honourable senators interjecting—

Sue Lines (President) Share this | Link to this | Hansard source

Minister Gallagher, please resume your seat.

Honourabl e senators interjecting—

Order, across the chamber. Minister, please continue.

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

on responsible economic management, that's focused on making sure the budget is actually used as a vehicle for investing in the things we need to do now but also in the things we need to do in the future; that we are looking, sensibly, at where our investments are going, to make sure that they are timed, in a way—

An honourable senator interjecting—

and I take the interjection from—

Honourable senators interjecting—

Well, the entire budget was, and we went through this in estimates with Senator Hume, who also tried to run this line that a clear fiscal— (Time expired)

Honourable senators interjecting—

Sue Lines (President) Share this | Link to this | Hansard source

Order! Senator McGrath, a second supplementary question?

James McGrath (Queensland, Liberal National Party, Shadow Assistant Minister to the Leader of the Opposition) Share this | Link to this | Hansard source

In Senate estimates, it was confirmed that the Prime Minister has not received a briefing on the economic challenges Australia faces from the Treasury Secretary. Has the Prime Minister subsequently received a briefing? When will he prioritise his time and policies to addressing the cost-of-living crisis confronting millions of Australians?

Sue Lines (President) Share this | Link to this | Hansard source

Order! Senator Wong! Order.

Senator Wong. Order! The question—

Order, Senator McGrath. Both of you—Senator Wong and Senator McGrath.

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

Well, that wasn't actually confirmed at Senate estimates. The Prime Minister has been repeatedly briefed, and the Secretary of Treasury also confirmed this, through our standard processes, through ERC and other committee processes; it was made clear that the Prime Minister had been briefed—had been consistently briefed; was involved in all of those discussions. So it's just wrong to say that.

And, for the first time, we actually have a prime minister that's doing his job, not taking everybody else's job, and leading a government whose sole focus is on how to manage the economic circumstances we currently live in—

Sue Lines (President) Share this | Link to this | Hansard source

Order, Senator Wong!

Honourable senators interjecting—

Order across the chamber!

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

whose 150 per cent focus is on making sure that this government is mindful of the lives of the Australian people. (Time expired)