Prime Minister Anthony Albanese has ruled out major cuts to health, education and essential services in December’s mid-year budget update, but conceded savings are required as Labor struggles to curb accelerating inflation. Source: The Guardian.
Amid growing pressure from within Labor’s own ranks, as well as from the opposition and business, Mr Albanese said the Coalition was hypocritical in not supporting existing savings proposals, including the government’s plan to reduce the private health insurance rebate for people over 65.
Privately, Labor MPs admit the strong likelihood of the Reserve Bank delivering the year’s fifth interest rate increase next week will compound the government’s political problem over the high cost of living, with some calling for radical moves from the federal government.
Ed Husic, the former industry minister, this week said price controls on essential groceries items were needed, calling for caps on the cost of bread, milk, meat and fresh produce.
Australia’s headline inflation rate rose to 4.3 per cent on Wednesday, dramatically increasing expectations of another interest rate rise on Melbourne Cup day.
The cash rate already stands at 4.6 per cent, its highest level in 15 years, after four rate hikes in 2026. A move to 4.85 per cent would bring rates to their highest levels in 18 years, putting further pressure on household budgets.
As the Coalition criticises Labor for the rate of government spending, Mr Albanese said he understood frustration in the community and efforts to find savings were under way.
“We will continue to meet over coming weeks as well, as we do consistently, looking for, making sure that appropriate savings are made,” he said, ahead of the budget update due in mid-December.
“What we won’t do is rip tens of billions of dollars out of health and education. That’s what happened last time when the Coalition came into office.”
Treasurer Jim Chalmers yesterday accused the Coalition of being consumed by “weird post-truth stuff” by refusing to acknowledge the global fuel shock as the biggest contributor to inflation.
Shadow treasurer Tim Wilson said Labor’s budget settings were “forcing Australian families to pay more for everything”.
FULL STORY
Albanese concedes savings needed as he faces internal Labor pressure on cost-of-living crisis (By Tom McIlroy, The Guardian)
