Chalmers reveals $149bn cut to national debt under Labor
Paul Karp
The treasurer, Jim Chalmers, has revealed that the final budget outcome will show that gross debt in 2023-24 is $149.1bn lower than what Labor inherited at the time of the election.
It will show gross debt at the end of 2023-24 was $906.9bn compared with the pre-election fiscal outlook which projected gross debt would exceed a trillion dollars last year.
Yesterday, Chalmers also revealed the final budget outcome will be a surplus in the “mid teens” rather than the $9.3bn projected in May.
In a statement, he said:
Through responsible economic management and spending restraint we’ve been able to get rid of a big chunk of the debt left to us by the Liberals and Nationals. Lower debt saves taxpayers on interest costs, helps in the fight against inflation and makes more room in the budget for what matters most like Medicare, aged care and defence.
Our economic plan is all about easing pressure on people at the same time as we fight inflation and get the budget in much better nick and this shows we’re making meaningful progress.
Back-to-back surpluses are helping in the fight against inflation and reducing the interest costs on a trillion dollars of Liberal party debt we inherited. We’re the first government to post back-to-back surpluses in nearly two decades.
Key events
Greens won’t pass Labor’s Reserve Bank reforms until interest rates are cut
The Greens have said they won’t help pass Labor’s RBA reforms until interest rates are cut.
In a statement, the party said that by cutting rates by 25 basis points, repayments on an average recent mortgage of $641,000 would reduce by around $100 a month, a saving of $1200 a year.
The Greens said that once interest rates are reduced, the Greens would back the treasurer’s legislation to restructure the RBA – as long as two existing provisions are retained in their current form: the provision allowing the treasurer to override decisions of the BRA, and the provision allowing the RBA to direct the money they advance to commercial banks into productive parts of the economy.
Senator Nick McKim said in a statement:
The Treasurer has the power to step in, he’s just not using it. The Reserve Bank could act, but they are not acting…
For weeks the treasurer has acknowledged the economy is being smashed, and that mortgage holders are being smashed by high interest rates – yet to date he’s done nothing about it despite having the power to reduce interest rates…
We aren’t going to pass Labor’s Reserve Bank reforms until interest rates are cut. The Reserve Bank Board are not infallible high-priests of the economy who are above criticism… The Greens won’t support these reforms until either the RBA cuts interest rates or Dr Chalmers forces them to.
Katy Gallagher questioned on tomorrow’s RBA rate announcement
The Reserve Bank of Australia is meeting again this week, with another decision on rates expected tomorrow. The finance minister Katy Gallagher has been making the rounds this morning, speaking with ABC News Breakfast on this.
Asked if she is worried the RBA will wait too long to cut rates, Gallagher responded that “we don’t comment on the decision of the Reserve Bank” – whose job is to bring down inflation while “our job is to make sure [we’re] helping people with cost of living”.
Gallagher was asked if she is worried she will cop more blame and this could see a result at the ballot box? She responded:
Governments have to deal with the economic circumstances that are there before us. We inherited an inflation challenge with a six in front of it, it’s moderated in welcome ways, but we get that people are doing it tough… We’re doing what we can whilst we’re trying to wrangle with this inflation challenge to make sure we’re helping people with the cost of living pressures they’re under.
Damaging wind warning for parts of Tasmania
In more weather news, a severe weather warning is in place for damaging winds across much of Tasmania today.
The Bureau of Meteorology says an approaching cold front is tightening the pressure gradient across the state, resulting in vigorous westerly winds.
Winds will start to ease once the front has crossed the state late this afternoon, however winds will remain gusty.
Damaging westerly winds around 60-70km/h with gusts around 100km/h are likely across southern, central, and eastern parts of the state, including over Hobart.
Meanwhile peak gusts around 120 km/h are possible about the eastern coastal strip district between Scamander and Swansea, as well as exposed and elevated areas of the state.
Locations which may be affected include St Helens, Swansea, New Norfolk, Hobart, Geeveston and Dover.
Prepare to leave warning for Queensland town amid fire
A “prepare to leave” warning remans in place for the rural Queensland town of Lakeland, amid a fast-moving fire.
According to the Queensland Fire Department, the fire is burning along Mulligan Highway towards Peninsula Developmental Road. Conditions may get worse quickly, it said, with firefighters working to contain the blaze.
The department said some properties are at risk and the fire is likely to impact the community in the coming hours.
Meanwhile, a fire ban for southwest Queensland is in place from today to Wednesday, due to heightened fire conditions. This will cover Toowoomba, the Southern Downs, Western Downs, Goondiwindi, Maranoa, Balonne, Murweh, Paroo, Quilpie and Bulloo LGAs.
Australia overtakes Russia in Asia influence rankings
Daniel Hurst
Australia has jumped one place in the Lowy Institute’s annual Asia Power Index, largely due to Russia going backwards as a result of its war in Ukraine.
The think tank ranks 27 countries and territories to rank their relative power in Asia. It is based on 131 indicators across eight broad themes: military capability, defence networks, economic capability, economic relationships, diplomatic influence, cultural influence, resilience and future resources.
In its 2024 report, released last night, the Lowy Institute continued to rank the United States in first place and China in second place, although Beijing was steadily eroding Washington’s comparative military capability advantage:
For the first time, experts surveyed for the Asia Power Index judged that China is better able to deploy rapidly and for a sustained period in the event of an interstate conflict in Asia.
The report said India’s power in Asia was growing and it had overtaken Japan to take third place for its comprehensive power for the first time. After Japan in fourth place, Australia was ranked fifth in the 2024 index, an improvement from the sixth place it held last year.
Australia has traded places with Russia, the report said, because the latter’s “relevance to Asia is declining as its war on Ukraine saps resources and focus”.
This increase in ranking, Australia’s second since the inception of the Asia Power Index (it surpassed South Korea in 2020), is more a function of Russia’s decline since 2018 than Australia’s rise.
The report also noted that south-east Asia’s most populous countries, Indonesia and the Philippines, were becoming more influential.
Chalmers reveals $149bn cut to national debt under Labor
Paul Karp
The treasurer, Jim Chalmers, has revealed that the final budget outcome will show that gross debt in 2023-24 is $149.1bn lower than what Labor inherited at the time of the election.
It will show gross debt at the end of 2023-24 was $906.9bn compared with the pre-election fiscal outlook which projected gross debt would exceed a trillion dollars last year.
Yesterday, Chalmers also revealed the final budget outcome will be a surplus in the “mid teens” rather than the $9.3bn projected in May.
In a statement, he said:
Through responsible economic management and spending restraint we’ve been able to get rid of a big chunk of the debt left to us by the Liberals and Nationals. Lower debt saves taxpayers on interest costs, helps in the fight against inflation and makes more room in the budget for what matters most like Medicare, aged care and defence.
Our economic plan is all about easing pressure on people at the same time as we fight inflation and get the budget in much better nick and this shows we’re making meaningful progress.
Back-to-back surpluses are helping in the fight against inflation and reducing the interest costs on a trillion dollars of Liberal party debt we inherited. We’re the first government to post back-to-back surpluses in nearly two decades.
Welcome
Emily Wind
Good morning, and welcome back to a new week on the Australia news live blog. I’m Emily Wind, and I’ll be with you most of this Monday as we bring you our rolling coverage.
The treasurer, Jim Chalmers, has revealed a $149bn cut to national debt under Labor. The final budget outcome will show gross debt at the end of 2023-24 was $906.9bn, compared with the pre-election fiscal outlook which projected gross debt would exceed a trillion dollars last year, he said.
Back-to-back surpluses are helping in the fight against inflation and reducing the interest costs on a trillion dollars of Liberal Party debt we inherited. We’re the first government to post back-to-back surpluses in nearly two decades.
Paul Karp will bring us the full details in a moment.
Meanwhile, Australia has jumped one place in the Lowy Institute’s annual Asia Power Index, largely due to Russia going backwards as a result of its war in Ukraine. The thinktank ranks 27 countries and territories to rank their relative power in Asia, based on 131 indicators across eight broad themes. Daniel Hurst will have more on Australia’s position soon.
As always, you can reach out via X, @emilywindwrites, or email, [email protected], with any story tips, questions or feedback.
Let’s get started.