Topics: Monthly CPI, Cost of Living, Stage 3 tax cuts

E&OE  

PETA CREDLIN:

But first the latest inflation figures out today from the ABS - the Bureau of Statistics. Australia's inflation rate has eased sharply in October, on the back of weakening consumer spending. This month, it was 4.9%. Last month 5.6%. And this of course makes it less likely, we're told, that the the Reserve Bank will hike rates again on Tuesday. But that's not a universal view. Some say Michele Bullock thinks that households can cope with more pain. But it's not all good news for the government, real household disposable income, well, that's down. Real per capita household income is also down, Australia's had the largest income collapse in the world. And this is on top of failed referendum, the introduction of economy-wrecking IR laws, and all the border stuff you've heard me talk about. So let's hope there's a bright light for the economy for us here at home and taxpayers who pay the bills. Joining me now, Shadow Treasurer Angus Taylor. Well, do we see these inflation numbers out today as a bright light for you, Angus? So is it good news?

ANGUS TAYLOR:

Well, I don't think Australians see it that way, Peta, because what they're actually seeing is prices just continue to go up. Inflation is prices going up and inflation is roughly double what the target is. And economists of course, look at core inflation or trim mean inflation, as it's called. And that went from 5.4 to 5.3, hardly a significant reduction. But the government wants to be congratulated for that. Well, the truth is, the government's asleep at the wheel on this. They haven't been focused on this as the main game, they've been running their $450 million failed referendum. And the result is we have inflation which is entrenched, the most entrenched in the advanced world, according to The Economist, and as you rightly pointed out, household disposable incomes have fallen more than any other advanced country in the world - 5.1% in a year - and that's a dramatic reduction in the standard of living of Australians. There is much government can do to alleviate this, to stop it from happening in the first place, fighting inflation is the key. And this government's failing.

PETA CREDLIN:

I listened to those reports Michele Bullock, the new RBA governor had said that Australian households despite this pain, those of the mortgage at least, are in a pretty good position, she said. Lots of political noise around. She said, you know, don't look at that. Look at the fact that, you know, they're resilient and they can keep taking this sort of pain if we can't get inflation under control. That worried me. I then saw the CPI and thought, well, there's a bit of hope there. We might not get a rate hike next Tuesday. But what do you think?

ANGUS TAYLOR:

Well, I don't run a running commentary on what Reserve Bank Governors say, but bankers are a bit inclined to say everything is okay if people aren't defaulting. Australians know that there's a lot of pain before they default on a loan. I mean, Australians are very disinclined to default on loans, they want to pay them back. And they will make all sorts of sacrifices along the way, whether it's taking on an extra job, not buying something that they would otherwise buy. We know that they're digging deep into discretionary items, they're digging deep into their savings as well, right now for many Australian households. So there is a lot of pain out there. I was at a food bank, in Queensland, just in Brisbane, just last week, and they're seeing triple the number of people coming through, that they were seeing a year ago. And indeed, they're seeing people who they would never have seen before. So there is a lot of pain out there, regardless of what central bankers like to say.

PETA CREDLIN:

Roy Morgan's reporting just at that vain, you know, 1.5 million of us are under mortgage stress - were classed as at risk. Household spending, we've talked about that, domestic travel is down and that's if you can afford to fly, it's pretty costly. And there's a whole lot of surveys around saying - looking into Christmas spending - people are pulling their horns in, you know, 40% of us are saying that we're not going to spend as much, we can't afford to spend as much we'll rein in the spending, we perhaps might do a little bit less in terms of, you know, food and wine and all the other things around the festive season. We are already in a per capita recession. So what needs to happen? If the government gets back to its day job next year and actually focuses on the economy, what do you want to see?

ANGUS TAYLOR:

Well, I want to see a government with the right priorities and a government that's making the right decisions. We're seeing a government with the wrong priorities, making the wrong decisions. And I'll give you a sense of this Peta, you're absolutely right, that we've got a GDP per capita recession. So what's that mean? The economy is going backwards from the point of view of individuals. In fact, it's worse than that, because what that means is the only thing driving the economy now is population growth, which is primarily immigration. We have an immigration driven economy. Now, we're not against immigration, but we are against an economy that only grows because of immigration. And that's where we've landed with this government. It hasn't had the right priorities. It's making bad decisions. You listed a number of those earlier in your programme, including industrial relations decisions where they're putting union officials in charge of the workplace. So I mean, that's the last thing we need right now when we're fighting an inflation crisis. Energy policies, where they promised $275. Indeed, we're seeing crazy policies from Chris Bowen which are not costed. So, you know - we're seeing, even fiscal policy, they've added an added $188 billion of spending since they came into government, aided by incredible coal and gas and iron ore prices. But meanwhile, they're not approving gas projects. So I mean, this is a government that's getting it all wrong. They're making the wrong calls. They've got the wrong priorities, and Australians will continue to pay a price until they get those priorities right.

PETA CREDLIN:

Just quickly, I mean, the PM was asked a cheeky question about the tax on the family home, but didn't rule it out. He scoffed at the response, but didn't rule it out. And then we hear today that there's a rearguard action from Labor backbenchers about the stage three tax cuts, which he has repeatedly said - the Prime Minister has repeatedly said - that he will honour. They're legislated - he says he'll honour them, but they look like they might be walked back. Have you got a comment on that? 

ANGUS TAYLOR:

Well, it's very clear from Labor backbenchers, that they've lost confidence in the Treasurer and the Prime Minister in managing the economy, and in delivering an economy that can have rising incomes, which is what we all want to see. And so they're now asking for drastic actions. And bizarrely, they're asking for tax increases, and one of the things they should know is that taxes have increased by 15% in the last 12 months. But there's no tax that Labor doesn't what - they think that's the solution to every cost of living crisis, Peta, which is just a very Labor thing to think. I think it's very unclear whether or not Labor's going to whack more taxes, honestly, they would love to, there's no doubt about that. But Albanese, his answer today suggests to me that they're not ruling these things out. They really aren't. He refused to rule it out. He said, it's not the plan right now. So we'll see.

PETA CREDLIN:

We'll see. Thank you very much Angus Taylor. 

ENDS.