Topics: Labor’s homegrown inflation, Labor’s cost of living crisis, PM more interested in the perks of the job than doing the job, Coalition’s back to basics economic agenda to get back on track 

 

E&OE   

 

ANGUS TAYLOR: 

Quarterly inflation data just out now, and the data tells us that there is still a long way to go in the battle towards a strong, low inflation economy in this country. There is still a long way to go in this battle towards a strong, low inflation economy in Australia. Temporary subsidies will not hoodwink the Reserve Bank of Australia, and they certainly won't hoodwink the Australian public. If you look under the bonnet of the numbers that have just come out today in the last hour or so, we see that the weighted mean, a measure of core inflation is still running at 3.8%, well above what was expected. The homegrown inflation, the non tradable inflation, is running at over 4%, almost seven times what the imported inflation level is. And that tells us that we've still got a sustained and persistent inflation problem in this country. Services inflation is running at 4.6% and the Reserve Bank has pointed out on multiple occasions how important that number is to understanding whether we're moving towards a more sustainable position. 4.6% which again, is way above the target level.  

Now it is clear that Australia is at the back of the pack in dealing with this persistent inflation. Our core inflation is higher than the Euro area, Sweden, Norway, Japan, New Zealand and Canada. And we see right across the world interest rates coming down, but not in Australia. Interest rates are coming down in the United States, in the UK, in New Zealand, in Canada, in Europe, not in Australia. Not in Australia. We are absolutely at the back of the pack. And just in the last week or so, the IMF has told us that Australia's inflation will be higher for longer, and we are in the worst position of all advanced major countries outside of Slovakia. And that is not where, that's not where we need to be right now. Australians are seeing this wherever they go. Since Labor has come to power, prices have now risen by 10%. Food up 11.7%, housing 12.9%, rent 16.4%, finance and insurance 18%, gas 33.9%. And electricity, absent the short term, temporary subsidies, up by 31%. And it's clear this government has failed to deal with the source of the problem. Instead, they're just dealing with symptoms.  

 

Now there is a better way, and it is about getting back to basics, getting back to basics to get the country back on track. That does mean government needs to manage its spending, and we've seen a government that has given up on the fiscal guardrails that were put in place by Peter Costello back in the 1990s, a government whose spending now is higher than at the peak of COVID. We've seen failures on the supply side of the economy. I've already talked about the energy failures, Australians have seen that since Labor came to power with the failure to deliver on their promises. With housing supply and of course, we've announced just in recent days, a $5 billion fund squarely and sharply focused on getting more housing supply into the market so young Australians and all Australians can have that great Australian dream of owning a home. We've seen a Labor government that has been empowering militant union officials with deep links to the underworld, and holding Australians to ransom in the process in our construction sector, for instance.  

This is a government that is out of its depth. This is a government that is out of its depth. We have a Prime Minister who is more interested in the perks of the job than doing the job. We have a Prime Minister that's more interested in the perks of the job than doing the job. He is more interested in flight upgrades than upgrades to the standard of living of Australians. And right now, we need an upgrade in the quality of government in this country. Happy to take questions.  

 

JOURNALIST: 

So today, you're saying Australians aren't better off under the new figures that've come out today?  

 

ANGUS TAYLOR: 

The one thing that is clear is that Australians are worse off under Labor. Since labor has come to power, we continue to see, we've continued to see a deterioration in Australians' standard of living, and right at the heart of that has been a raging, persistent inflation which this government has never had a credible plan to beat. And that's why we're at the back of the pack in dealing with it. In country after country around the world, we're now seeing interest rates coming down, inflation coming back to target, we're still well short of that here in Australia. And we are in the grips of a persistent household recession. GDP per capita in this country has gone backwards for six quarters, 18 months, the majority of the time Labor has been in power. In the private sector now we're seeing insolvencies at record rates. Almost 24,000 businesses going out of business since Labor came to power, and we have a Treasurer who crows about how wonderful it is that he's spending so much money. Well, you know, that's an unsustainable proposition for an Australian economy. And time and time again, we see this is a Treasurer, and this is a government which is out of touch and out of its depth. 

 

JOURNALIST: 

Headline inflation is now within the Reserve Bank's target band. Do you expect the bank to cut interest rates anytime soon? 

 

ANGUS TAYLOR: 

Well, interest rate policy is a question for the Reserve Bank, but let's be clear, you cannot hoodwink the Reserve Bank with headline numbers with temporary subsidies in them. That's not going to work. And the Reserve Bank has already made that point. They've made that clear. The number that matters is those core numbers that I've already been through. They're well above where we need to be in terms of target rates. And that's because this government has not dealt with the underlying source of the problem. You know, this is a government that loves to put a band aid on a bullet wound, but not deal with the underlying problem. Time and time again, it's dealing with symptoms, not sources, and this is why this goes on and on and on, and Australians feel this persistent and sustained pain.  

 

JOURNALIST: 

And what role do you think the Coalition's COVID packages had in possibly adding to inflation? 

 

ANGUS TAYLOR: 

Well, let's be clear, spending now is higher than it was at the peak of COVID, higher than at the peak of COVID. And this is a Treasurer who wanted to spend an additional more than $80 billion during COVID than we did, which, you know, it's extraordinary how pathetic and desperate this Treasurer and government is when they come out and say it's all someone else's fault. But that's where they're at now. That's where they're at now. They're still looking for excuses for their absolute and abject failures, and I assume they will continue to do that, because this is a government that simply doesn't know what it's doing.  

 

JOURNALIST: 

Angus, would you classify this result as artificial or even an illusion due to the government rebates?  

 

ANGUS TAYLOR: 

Well, the real question is whether core inflation is where it needs to be. And the answer is clear. It's no. It's no, and the Reserve Bank has made that clear, that's what they'll look at, and that's where, ultimately, that's the increase in prices that Australians will pay on a sustained basis. I mean, these are temporary subsidies from the government. Australians won't be hoodwinked and the Reserve Bank won't be hoodwinked. 

 

JOURNALIST: 

If you were the Treasurer now, Angus, what policy changes would you pull to bring inflation down further?  

 

ANGUS TAYLOR:  

Yeah, as I said a moment ago, it's getting back to basics. This is a government that doesn't understand the basics of how an economy works. This is a Treasurer who simply doesn't understand how an economy works. He's not a Doctor of Economics. He's a Doctor of Spin, and that shows every single day in his and this government's failures. We've said we would re-establish the fiscal guardrails that were in place since the 1990s, put in place by Peter Costello and abolished by this Treasurer because he decided that the answer to every problem was bigger government, more government spending. 36,000 additional Canberra based public servants. I mean, this is how this government thinks you solve the problem. It's not how you solve the problem. We know that because last time we've had inflation in the Australian economy with a sluggish growth situation, indeed, a household recession right now, we solved it by getting back to basics. Making sure that you've got enough energy supply coming into the system, making sure you're focused on getting that housing supply up, making sure the militant union officials aren't holding Australian households and Australian businesses to ransom. I mean, this is the basic stuff of government that ensures you have a strong, low inflation economy. That's what we stand for, and it's what we're going to continue to fight for. But as I said, this is a Prime Minister right now more interested in upgrading flights than he is in upgrading the standard of living of Australians, and we need an upgrade in government in this country. Thank you very much. 

 

ENDS.