Linda Reynolds (WA, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer, Senator Gallagher. Minister, last month you stated that the targeted cost-of-living measures announced in the budget are expected to reduce inflation, with energy bill relief expected to directly reduce inflation by half a percentage point in 2024. However, today's monthly inflation figures reveal that electricity prices rose by 6.5 per cent in the 12 months to May and that now, after two years of Labor, Australians are paying 21.1 per cent more for their energy bills. Will you now admit you were wrong?

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

I thank the senator for the question, and no, I was not wrong in those comments; they are outlined in the budget. I would just say that we are talking about the budget that kicks in on 1 July 2024. The measures I was speaking about relate to that period, and the budget papers are very clear about the forecasts or the estimates that Treasury have attached to those measures that put downward pressure on inflation. They are the energy bill relief, which will kick in from 1 July, and the Commonwealth rent assistance, an additional payment in the 2024-25 financial year.

But it's very clear, even from the data today—the monthly data, which moves around a bit—that the measures we have already put in place, the energy bill relief and the work that we did on Commonwealth rent assistance last year, have reduced the increases that people would have otherwise experienced. Those opposite voted against them and they criticised them, and in a continued attack on the budget they say it was unnecessary spending. We don't agree with that. We think those measures were targeted and appropriate, and that's why we're building on them in the next budget. They will come into effect on 1 July, in conjunction with the tax cuts that we have reshaped so that they better meet the needs right across the income brackets and, indeed, in particular cohorts like low-paid workers and women, who will get those tax cuts from 1 July. I completely stand by the budget that the Treasurer delivered and the forecast, which is outlined in the budget papers, that those measures will reduce the impact on inflation.

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

Senator Reynolds, first supplementary?

Linda Reynolds (WA, Liberal Party) Share this | Link to this | Hansard source

The economist Warren Hogan said today: 'No-one wants to hear it or believe it, but it looks like underlying inflation is picking up in Australia in 2024. The 4.35 per cent cash rate won't get the job done on inflation, and there's a $40-plus billion fiscal bomb about to hit in a few days time.' So, Minister, how can you possibly claim, as you just have, that your budget puts downward pressure on inflation when Australians are now facing the prospect of another interest rate hike? (Time expired)

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

Well, the bank will make decisions about the setting of the cash rate, and I don't comment on that. In relation to the figure that you've just used for the impact on 1 July, am I to believe now that the opposition does not support the tax cuts? I think the figure was being used as though, if tax cuts come in on 1 July, what you were arguing was that then interest rates will go up because of the tax cuts, and that led me to believe that you now don't support the tax cuts. Is that right? You can't criticise it and still support it—or you don't support it now? Well, I think people will be very interested in that.

The measures that we are putting in place that come into effect on 1 July, including the energy bill rebates, will come in over the 12 months of the financial year. They are going to be delivered in a way that makes sure that people are getting that relief, but it's not coming in one hit at one time. (Time expired)

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

Senator Reynolds, second supplementary?

Linda Reynolds (WA, Liberal Party) Share this | Link to this | Hansard source

Minister, I am very glad you mentioned energy prices, because I want to ask you: with electricity up 21.1 per cent and gas up 22.2 per cent under Labor, when can Australians expect to see their energy bills drop permanently by the $275 a year you promised 97 times ahead of the last election and just referenced again now?

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

I thank Senator Reynolds for the question. They will see the results of this government's measured, responsible plan of rolling out renewables over the long term ease their energy bills, and we know that because renewables, firmed up with storage and gas, are the cheapest form of energy transition, unlike the risky plan that's been outlined by Peter Dutton, Mr Dutton—it seems by mistake in an interview, where he walked away from the 2030 targets when he meant to walk away from the 2050 target—to adopt the most expensive form of energy generation in a way that nobody can describe. None of you can describe it here, including the cost—not only what it'll cost to build or how much it'll contribute to the energy grid but also what it means for energy bills, what households will pay for Mr Dutton's risky plan.