Jim Chalmers preparing his first budget. Photo: Supplied.
There are signs that the Albanese Government is too cautious and timid to tackle the big issues facing Australians as they head towards Christmas with shrinking pay packets and soaring bills.
In case you haven’t heard, we’re facing tough times.
Treasurer Jim Chalmers won’t stop saying how frank he needs to be with Australians about the economic and budget challenges ahead.
The Reserve Bank, which told us there wouldn’t be any interest rate rises until 2024, has just unleashed its seventh straight rise of the year and warned Australians of a couple of tough years ahead.
Is that so?
It expects inflation to stick around longer than expected, requiring it to continue choking the economy so it will return to the goldilocks range of 2 to 3 per cent in, say, 2025.
We can only hope it is as wrong as it was on its previous forecasts.
The only impact the war on inflation seems to be having is on house prices, but when the other big components of inflation – food, fuel and energy – are beyond the hapless consumer’s control, one wonders whether jacking up rates will make any difference at all, other than to tank the economy.
The weather, big oil and the Russians are no respecters of interest rates or governments, and people still have to eat and get to work.
The Ukraine war has made a mess of energy bills. Still, the sector was already a basket case thanks to the short-sightedness of previous governments when it came to managing the country’s gas exports, effectively making us beggars in our own land.
Not to mention a lost decade when they should have been managing the transition to a new energy system.
Rest assured, though, the adults are now in charge, and they’re working on it.
Just be patient.
But the budget has come and gone, with little to show for it.
Except for a dire warning about ever-rising energy bills as coal and gas exporters rake it in.
Australians with mortgages brace monthly for another whack, while those without face rent rises in an insecure market. Those waiting for a home to be built fret the dream will turn into a nightmare with every rate rise.
Just be patient.
Mr Chalmers floats all kinds of possibilities and worries about interfering in markets but won’t be frank enough with us to say if you want services and a balanced budget, we have to pay, or at least some of us, more tax.
Australians have been patient. They elected a Labor government to give the country a new direction, but we’re still waiting.
A change of tone or style is not enough.
Australians expect the government, no longer new, to show leadership and take action.
There is strong support for it to impose a windfall tax on gas and coal producers and for a gas reservation policy like Western Australia has so Australians, particularly industry, don’t have to pay the same price as in Europe for our own gas.
The electricity market, such as it is, is kaput, so the government should step in to ensure prices remain affordable and the lights stay on while accelerating the move to renewables.
Reports are that the government is again looking at tax concessions. They should stop just looking and dust off the 2019 election policies on franking credits and negative gearing and capital gains tax, which would save the government billions and help stabilise the housing market.
Because no matter what the scare campaigns were, they were right then and even more so now.
They should also scrap the stage 3 tax cuts, which are unaffordable, make the system even more inequitable and are morally wrong when someone on JobSeeker or a pension is given a pittance to live on.
It’s time a government stopped pandering to sectional interest groups, scrapped handouts to people who don’t need them and built a tax system fit for a modern social democratic nation instead of peddling fairy tales about the trickle-down benefits of a low-tax economy.
Prime Minister Albanese and Mr Chalmers need to drop the soothing words, stop blaming their predecessors and ignore the headlines. They need to sound the trumpets and do something because the country is in a crisis and patience has run out. And they don’t have much time to fix things before another election is breathing down their neck.
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