The deputy leader of the Liberal party has been urged to consider the impact of the Coalition’s huge Covid spending had on inflation in a fiery ABC TV interview.
Sussan Ley told ABC News Breakfast she is ‘disappointed’ in Treasurer Jim Chalmers’ Budget and suggested the cost of living measures could backfire and inflict further pain on struggling families.
‘There was an expectation the RBA would not be raising rates, but now with this Budget in front of them, they’re talking about winding back predictions,’ she said.
‘Households are under siege. The average family [will be] going backwards by $25,000 a year,’ she claimed.
But host Lisa Millar questioned Ms Ley’s claims – given economists are divided over whether the Budget will drive up or prolong inflation.
She also noted Coalition stimulus packages during Covid added significant pressure to Budget, questioning whether these were more inflationary than Dr Chalmers’ measures.
Sussan Ley has been urged to consider the impact the Coalition’s huge Covid spending had on inflation in a fiery ABC TV interview with Lisa Millar
‘We spent what we needed to,’ Ms Ley said.
Again, Millar asked: ‘Yes, but didn’t it contribute to some of the inflation we’re seeing now?’
Ms Ley said: ‘That spending was critical.’
Millar repeated her question, to which Ms Ley said: ‘It helped Australians get through.’
Finally, Millar snapped, saying: ‘Are you going to answer the question?’
Economists are divided over the impact Dr Chalmers’ Budget – which included a hike to Jobseeker and Commonwealth Rent Assistance – will have on inflation.
KPMG chief economist Brendan Rynne said there is a risk the Budget could push up interest rates and the fight against inflation will be prolonged.
However, several economists, including NAB’s Alan Oster, consider the Budget to have a relatively neutral impact.
Ms Ley did not acknowledge any involvement by Coalition decisions in inflation.
She said: ‘The inflation is a result of the tax-and-spend policies of this Labor government. They have clearly not got a proper plan to tackle inflation.’
‘From Toorak to Townsville, from Perth to Penrith and everywhere in between and I can see that effect on small businesses on everyday Australians, on households and they are really hurting and there isn’t a proper plan to address their cost-of-living crisis.
‘People will talk about all sorts of things but everyone is acknowledging there is a crisis and I can assure you it’s biting across Australia. I know you’ve had people on your program to talk about it.’
Dr Chalmers said on Tuesday night that his Budget would ‘help those who need it most’ – unveiling a $3.5billion plan to help 12 million Aussies see a doctor for free under Medicare, a $40-per-fortnight cash boost to welfare recipients, including dole, Youth Allowance and Disability Support Pensions.
The Budget includes a $500-per-year energy bill package for households that earn less than between $108,000 and $117,000, and programs that will benefit Australians through services rather than cash handouts.
Dr Chalmers said on Tuesday night that his Budget would ‘help those who need it most’
They include cheaper medicine and childcare for some families, higher salaries for care workers and assistance for Aussies battling to break into the housing market – including allowing more Australians to buy a home with smaller deposits.
But tucked inside the plan were some nasty shocks for taxpayers including confirmation he will scrap the lower and middle income tax (LMITO, or ‘Lamington’ offset) – which will cost some 10 million Australians up to $1,500 at tax time despite the rising cost of living.
Meanwhile, smokers will be stung with higher prices, the Stage Three tax cuts due to come into force in the middle of next year are going no-where – mostly benefiting Australians who earn more than $200,000 – and voluntary contributions to super will be taxed at 30 per cent after balances hit $3million.
In a speech announcing his Budget on Tuesday evening, Dr Chalmers said he was desperately trying not to add to inflationary pressures – with the consumer price index at seven per cent.
‘This Budget is carefully calibrated to alleviate inflationary pressures, not add to them,’ Dr Chalmers said.
‘The pressures on the Budget are acute – but as a Labor Government we will always strive to help those who need it the most.’
Dr Chalmers has denied the Budget will add to inflation.
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Source: | This article originally belongs to Dailymail.co.uk