The government put down its fiscal strategy in May in the budget, and this fiscal strategy has not even lasted until the first sightings of Santa Clauses in our shopping centres. I haven’t seen Santa yet this year. I’m sure it will happen very soon. In the last few weeks, the whole government’s fiscal strategy has been rubbish and in tatters, because the Treasurer and the Minister for Infrastructure, Transport, Regional Development and Local Government have been out there admitting that their spending is causing inflationary pressures. They have announced that they want to cut or slash infrastructure spending, specifically, to take the pressure off inflation.
The question has to be asked: why didn’t the government do this six months ago when it delivered its budget? Why didn’t they get ahead of the game and cut spending back then so that they could help Australian families take the pressure off inflation and also help the Reserve Bank so that it didn’t have to raise interest rates 13 times. Twelve of those 13 have happened while this government has been in charge. It did nothing in the budget. Despite what you will hear in this debate from government senators, the facts do not lie. In their own budget in May, on page 94 of Budget Paper No. 1, there is a very helpful table. It’s buried, though. You’ve got to go looking for it. It outlines the effect of government policy decisions on the budget. The government will claim it delivered a surplus. They only really delivered a surplus thanks to the mining industry—all the coal, iron ore and gas coming in. It was nothing they did specifically. What they did can be seen in the line in this table which says, ‘Effect of policy decisions.’ That table shows that the effect of policy decisions from the government’s budget was to deteriorate the budget in net terms, to have net spending of $20.5 billion. They added $20 billion of fuel to the inflation fires already raging through this country. That is in their own table in their own budget.
How much and how big is a $20 billion injection in a budget? If you take out the COVID years—obviously, COVID was different and hundreds of billions of dollars were injected in those years because we shut down the country—this is the biggest increase, the biggest injection, the biggest fiscal expansion of any government since Kevin Rudd’s response to the global financial crisis. So that’s for 15 years. The government is going around saying, ‘We delivered a surplus.’ No, your decisions added $20½ billion to the economy, which was the biggest non-COVID increase in fiscal expansion since Kevin Rudd’s days.
At least Kevin Rudd had a global financial crisis to respond to. He was responding to a global recession. While he overegged it a bit, in hindsight, the direction was right. At that time, fiscal expansion was needed to help support the economy and avoid recession, avoid a further contraction. The environment right now is the direct opposite. There is global inflation, not a global recession. We had to try to take the fire out of that inflation—or we should have—in the budget six months ago, but, instead, the government added $20½ billion to it. Now, belatedly, they’re admitting that they’re spending too much. Senator Babet’s motion is exactly right. It should have been done six months ago. Now we’re playing catch-up, thanks to this government, and the people paying for that catch-up are those, especially mortgage holders, who are paying thousands and thousands of dollars more a month. In my home state of Queensland, the average mortgage holder is paying $1,200 more a month because of these interest rate increases. How are people affording this? It is unbelievable.
The other problem we’ve got here is that inflation hasn’t fallen, as the government expected. It hasn’t fallen in line with the budget forecast. The RBA the other week had to revise its inflation forecast up. So the government’s plans are not working. Everything you’ll hear from government senators in this debate will be about how they’re providing assistance through bulk-billing relief, PBS changes or childcare support. All of those policies were announced at the election last year. They were announced before inflation got worse over the past few months. So the question Australians have to ask is: why aren’t you doing more now? Why aren’t you providing more cost-of-living relief, given the consequences of your actions, which have helped fuel inflation and make it even harder for Australians than it was predicted to be over 18 months ago when all these cost-of-living policies of the Labor Party were designed?
The Labor Party are finally playing catch-up on the spending side—or they say they’re going to; we haven’t seen real action yet—but they’re yet to play catch-up on cost-of-living relief. There should be more cost-of-living relief. If the government are going to cut infrastructure funding, why can’t they cut fuel taxes? We’re paying 48.8c a litre in fuel excise. It should go into funding roads, but the government aren’t going to do that anymore. They’re not going to fund your roads, so why are you paying almost 50c a litre at the bowser? Give us a fuel tax cut and some cost-of-living relief. We’re getting nothing from this government right now.
