At first glance, Anthony Albanese’s National Press Club address was about economic resilience — fuel security, supply chains, and a government determined to “keep Australia moving.”

But the most revealing moments came not from the prepared speech, but under questioning: when the Prime Minister was pressed on Donald Trump — and on whether Australia’s Parliament is still fit for purpose.

In both cases, Albanese chose caution over confrontation.

Trump, the alliance — and a carefully managed silence

The Prime Minister was given multiple opportunities to respond to comments from U.S. President Donald Trump, particularly around the Middle East conflict and the expectation that allies might shoulder more responsibility.

What emerged was not a strong position — but a carefully managed one.

“We do want to see a de-escalation… the objectives that President Trump outlined… have largely been achieved.” 

It was diplomatic, but deliberately non-committal.

Albanese neither endorsed Trump’s approach nor challenged it directly. Instead, he reframed the issue around outcomes — suggesting the mission had largely been achieved and that escalation no longer served a purpose.

That framing is politically safe. It avoids antagonising Washington while signalling unease about the economic consequences of prolonged conflict.

But it also raises a question: is Australia shaping events — or simply reacting to them?

Even when asked whether Trump’s actions had undermined public support for AUKUS — a question that goes directly to long-term strategic alignment — Albanese declined to engage.

“People will have different views… my job… is to develop relationships with world leaders.” 

That is true — but incomplete.

In an era where alliance politics are increasingly contested domestically, managing relationships is only part of the job. Explaining them — and defending them — is the other.

On that front, the Prime Minister offered reassurance, but little clarity.

A Parliament under strain — and a debate avoided

If Albanese was cautious on foreign policy, he was more definitive — but arguably more revealing — on the question of expanding Parliament.

Australia’s population has grown significantly, while the size of the House of Representatives has not kept pace proportionally. The result is a growing disparity in representation — particularly between fast-growing urban electorates and smaller states protected by constitutional minimums.

It is a legitimate structural issue.

But Albanese shut down the conversation entirely:

“I have never been engaged for one minute about an expansion…” 

The reasoning was not constitutional or philosophical — it was political.

“The sort of campaign that would be run against an expansion… would… not be healthy for our democracy.” 

This is where the tension becomes clear.

The Prime Minister acknowledges the pressures — larger electorates, shifting demographics — but ultimately argues that the politics of reform make it too difficult to pursue.

That may be realistic. But it is also revealing.

Because it suggests that even where structural reform may be justified, the government is unwilling to engage if the political cost is too high.

Resilience — but within limits

The broader theme of Albanese’s address was resilience: a more self-reliant economy, stronger domestic industry, and a government prepared to intervene where markets fall short.

It is an agenda that implies ambition.

But in practice, the Press Club exchanges showed a more constrained approach.

• On Trump and the alliance: stability over assertiveness
• On parliamentary reform: political caution over structural change

Inside Canberra Insight

There is a growing gap in Australian politics between the scale of the challenges being described — geopolitical volatility, economic transformation, institutional strain — and the scale of the reforms being pursued.

Albanese’s Press Club performance captured that gap.

The question for Canberra is whether that approach will be enough.

Because in a world that is becoming less predictable — and more demanding — resilience may ultimately require more than caution.

This analysis examines:

• Population and representation trends
• The numerical structure of the proposed expansion
• Electoral outcomes based on 2025 data
• The specific implications for the Australian Capital Territory

1. Representation Ratios: The Structural Driver

Australia’s Parliament currently consists of:

• 150 Members of the House of Representatives
• 76 Senators

The last major expansion occurred in 1984, when Australia’s population was approximately 16 million.

As of 2025:

• Australia’s population exceeds 27 million

This implies:

• Population growth of approximately +70% since the last expansion

However:

• The House has increased only modestly over that period
• The Senate structure has remained largely unchanged

Current Representation Ratio

• ~120,000–130,000 constituents per MP (derived from population divided by 150 seats)

By comparison, many OECD democracies maintain lower voter-to-representative ratios, indicating that Australia operates with relatively larger electorates.

2. Proposed Expansion: Numerical Parameters

The most widely referenced expansion model includes:

House of Representatives

• Increase from 150 → ~174–175 seats
• Net addition: +24 seats

Senate

• Increase from 76 → ~90+ Senators
• Net addition: +14 to +16 Senators

Territories

• ACT: 2 → 4 Senators
• NT: 2 → 4 Senators

Cost Estimate

• Approximately $600 million (Parliamentary Budget Office modelling cited at press conference) 

3. House Expansion: Distribution Based on 2025 Results

2025 Federal Election Outcome (House of Representatives)

• Labor: 94 seats
• Coalition: 43 seats
• Crossbench and others: remainder

These figures establish the baseline from which additional seats would be distributed.

Projected Allocation of +24 Seats

Based on:

• Population growth distribution
• 2025 voting patterns
• Electoral geography

The illustrative allocation used in the charts is:

Interpretation

• Labor receives approximately 54% of additional seats (13/24)
• Coalition receives approximately 25% (6/24)
• Minor parties and independents collectively receive approximately 21% (5/24)

This reflects the concentration of population growth in Labor-leaning electorates.

4. Senate Expansion: Quota and Distribution Effects

Current Senate Composition (48th Parliament)

• Labor: 29 seats
• Coalition: 27 seats
• Greens: 10 seats
• Crossbench: 10 seats

Projected Additional Seats (+16 Scenario)

Quota Dynamics

Under the current system:

• With 6 Senate seats per state, quota ≈ 14.3%

Under an expanded system:

• With 7 seats, quota falls to ≈ 12.5%

Implication

• A lower quota reduces the vote share required to secure representation
• This increases the probability of minor party and independent success

5. ACT Senate: Empirical Baseline (2025)

ACT Senate Primary Vote (2025)

• Independent (Pocock): 39.16%
• Labor: 31.74%
• Liberal: 17.76%
• Greens: 7.78%

Quota Under 4 Seats

• Approximately 20%

Baseline Seat Allocation (Mathematical Interpretation)

Seat 1

• Independent: 39.16% → exceeds quota

Seat 2

• Labor: 31.74% → exceeds quota

Remaining Seats (3 & 4)

Remaining allocation depends on:

• Surplus transfers
• Preference flows
• Relative positioning of Liberal vs Greens vs remaining Labor vote

6. Liberal Pathway: Quantitative Thresholds

For the Liberal Party to secure a seat:

Primary Vote Requirement

• Increase from 17.76% → ~23–25%

This represents:

• A required swing of approximately +5 to +7 percentage points

Relative Position Requirement

• Liberal vote must exceed:
  • Greens (~7.78%)
  • Remaining Labor surplus
  • Compete with independent transfers

Preference Sensitivity

Given:

• Independent vote: 39.16%
• Progressive preference alignment

The Liberal pathway is dependent on:

• Reduced consolidation of preferences behind the leading independent
• Competitive positioning after exclusion counts

7. Labor Risk Scenario: Quantitative Conditions

Labor currently holds:

• 31.74% primary vote

To retain two seats under a 4-seat model:

• Labor requires approximately 1.5–1.7 quotas post-preferences

Loss Scenario Conditions

Labor may fall to one seat if:

• Primary vote drops below ~30%
• Liberal vote rises above ~23%
• Independent remains above quota
• Greens maintain or increase vote share

Illustrative Redistribution Outcome

8. Comparative Sensitivity: ACT vs National System

The ACT demonstrates:

• Higher volatility per percentage point change
• Greater sensitivity to candidate effects
• Stronger influence of preference flows

This contrasts with larger states, where:

• Vote fragmentation is diluted across more seats
• Outcomes are less sensitive to marginal shifts

9. System-Level Implications

Across Australia, expansion produces three measurable effects:

1. House of Representatives

• Reinforces population-driven representation
• Slightly increases alignment with growth electorates

2. Senate

• Lowers electoral thresholds
• Increases representation diversity

3. Territories

• Gains in representation are proportionally larger
• ACT influence increases significantly relative to population

Conclusion

The proposed expansion of Parliament is not simply a political proposal.

It is a numerical adjustment to:

• Population growth
• Representation ratios
• Electoral mechanics

The data indicates that:

• House expansion modestly reflects population distribution
• Senate expansion materially alters representational thresholds
• ACT outcomes are highly sensitive to small vote changes

Ultimately:

The consequences of expansion are not determined by rhetoric,
but by arithmetic.

The proposal to expand Australia’s federal Parliament is often framed as a political choice. In practice, it is more accurately understood as a response to measurable structural pressures within the electoral system.

Opening with warmth and humility, the Ambassador acknowledged the significance of the moment—not only for his own diplomatic posting, but for what he described as a “historic” period globally. 

A Personal Journey, A Diplomatic Mission

Ambassador Newman’s remarks began not with policy, but with story.

Tracing his roots from South Africa to Israel, he spoke of his parents’ decision to leave a system of segregation in search of a society grounded in equality and shared destiny. That experience, he said, shaped both his worldview and his career.

Israel, in his telling, is a “living mosaic” of cultures and histories—a nation defined by diversity and democratic aspiration. 

It was a deliberate framing: one aimed at connecting with an Australian audience equally invested in multiculturalism and democratic values.

A Relationship Built on Shared Values

Throughout the address, the Ambassador emphasised the longstanding ties between Australia and Israel, describing the relationship as one grounded in “values, principles and mutual interests.” 

He acknowledged that disagreements between allies are inevitable—but stressed that such differences should not overshadow the deeper alignment between the two nations.

In a notable moment, he also commended Australia’s stance on regional security issues, particularly in relation to Iran, positioning Canberra firmly within what he described as a community of “moderate modern democracies.” 

A World in Flux

The speech did not shy away from the complexity of the current geopolitical environment.

Ambassador Newman framed the present moment as one of profound transformation, arguing that the Middle East—and potentially the global order—is undergoing significant change. 

He spoke at length about Israel’s security challenges, including the events of October 7, 2023, and the broader regional tensions involving Iran and its proxies. These, he argued, are not isolated issues but part of a wider contest between what he characterised as “moderates and radicals.”

For an Australian audience, the message was clear: distance no longer guarantees security in an interconnected world.

Implications for Australia

A notable feature of the address was its effort to connect Middle Eastern dynamics directly to Australian interests.

From energy security to social cohesion, the Ambassador highlighted how global instability—particularly disruptions in oil supply routes—can have tangible effects on Australian households. 

He also addressed the rise of anti-Semitism globally and within Australia, describing it as a challenge that requires collective vigilance.

Engaging the Press—and the Public

In a robust Q&A session, the Ambassador fielded questions on a range of topics, including civilian casualties, military operations, and legislative developments in Israel.

While defending Israel’s positions, he repeatedly emphasised the complexity of decision-making in a volatile security environment, noting that allies’ perspectives are “taken seriously,” even when they are not ultimately adopted. 

The exchange underscored both the scrutiny Israel faces internationally and the importance of forums like the National Press Club in fostering open dialogue.

Looking Ahead

Ambassador Newman’s address marks the beginning of what is likely to be an active and closely watched diplomatic tenure in Canberra.

His message was ultimately one of partnership—grounded in shared values, tested by global uncertainty, and shaped by the realities of a rapidly changing world.

As Australia continues to navigate its role on the international stage, the Ambassador’s remarks serve as both an introduction and an invitation: to engage, to debate, and to strengthen a relationship that has long been a feature of Australia’s foreign policy landscape.

But buried within the noise of One Nation’s surge and voter disillusionment is a quieter, more strategic story:

The Coalition isn’t finished — it’s repositioning in a fractured field.

The Big Picture: Collapse of Dominance, Not Total Displacement

Across almost every major issue, neither Labor nor the Coalition commands authority.

Instead, the data is defined by:

• A surge in minor party influence
• A dominant “Other” category
• And increasingly fragmented voter trust

But fragmentation cuts both ways.

Where others see decline, seasoned operators see opportunity.

Coalition Strength #1: Still Competitive on the Economy

On the economy, the Coalition sits at 25% — tied with Labor.

That may not sound like a win, but in context, it’s significant.

Historically, the Coalition has relied on a clear economic lead. That edge may have softened—but crucially, it hasn’t collapsed.

Why this matters:

• The Coalition remains credible on economic management
• Labor has not established a decisive advantage despite incumbency
• Voters are still open to persuasion

In a fragmented environment, parity is often enough to rebuild dominance with the right narrative.

Coalition Strength #2: Cost of Living Is Still in Play

On cost of living, the Coalition sits at 17%, behind Labor (23%) but within striking distance—and notably close to One Nation (19%).

But the real story is the 30% “Other” vote.

This is where the Coalition’s opportunity lies.

The Coalition still has the infrastructure and credibility to convert concern into policy narrative.

Strategic implication:

Cost of living isn’t owned by anyone — meaning it can still be won.

Coalition Strength #3: Housing Is Wide Open

On housing affordability:

• Coalition: 14%
• Labor: 21%
• One Nation: 19%
• Other: 36%

At first glance, the Coalition trails.

But again, the dominant bloc is “Other” (36%).

This signals something critical:

Voters don’t believe any major party has solved housing — including Labor.

For the Coalition, this is a reset opportunity.

Particularly in places like Canberra, where planning, density, and development debates are front and centre, a coherent housing agenda could rapidly rebuild trust.

Coalition Weakness — But Also a Strategic Opening: Immigration

The Coalition’s 12% on immigration is its weakest result in the dataset.

One Nation’s 40% dominance here is undeniable.

But this is not just a loss — it’s a warning signal.

Immigration has become:

• A proxy for cost of living
• A proxy for housing pressure
• A proxy for infrastructure strain

The Coalition’s path forward is clear:

• Re-engage the issue with credibility
• Broaden it beyond borders into economic and infrastructure capacity
• Reclaim ground without simply echoing minor party rhetoric

Because if immigration remains ceded, it risks anchoring broader voter dissatisfaction elsewhere.

Coalition Strength #4: No Issue Is Locked Away

Perhaps the most important insight for Coalition strategists:

No issue in this dataset is decisively owned by Labor.

Even where Labor leads:

• Healthcare (30%) vs 31% “Other”
• Crime (21%) vs 33% “Other”

This is not dominance — it’s fragile plurality.

Which means:

• Voters are not deeply aligned
• Positions are fluid
• Campaigns and policy clarity can still shift outcomes

The Real Battlefield: The “Other” Vote

Across every issue, the largest or second-largest group is “Other”.

This is the real contest.

It represents:

• Disengaged voters
• Minor party drift
• Independents
• And a growing “none of the above” sentiment

For the Coalition, this is not a threat alone — it’s a target-rich environment.

Unlike smaller parties, the Coalition has:

• National infrastructure
• Policy development capability
• Electoral reach

If it can reconnect with this bloc, it doesn’t need to dominate — it just needs to reassemble a coalition of the unconvinced.

Inside Canberra Takeaway

Yes, One Nation is rising.

Yes, voter frustration is deepening.

But the underlying story is not the replacement of the major parties.

It’s something more fluid:

A political market where loyalty is gone — and persuasion is back.

For the Coalition, the data shows:

• It remains competitive where it matters
• It has not been locked out of any major issue
• And it retains the capacity to rebuild authority

What to Watch Next

• Whether the Coalition sharpens its economic narrative to break the tie with Labor
• Whether it reclaims ground on immigration without overcorrecting
• Whether it steps into the housing vacuum with a credible national plan
• And how it engages the growing “Other” voter base — particularly in politically sensitive urban debates like those emerging in Canberra

Because in this environment, elections won’t be decided by loyalty.

They’ll be decided by who can most convincingly answer the question voters are now asking of everyone:

“Why should we trust you — over anyone else?”

Speaking in Brisbane on Saturday, Opposition Leader Angus Taylor argued that Australians are facing a dual challenge—limited fuel availability in some areas and increasing costs at the bowser. He pointed to reports of more than 600 service stations experiencing shortages, alongside broader cost-of-living pressures.

“These are not abstract issues,” Taylor said. “Families are already dealing with higher mortgage payments, groceries, and electricity bills. Fuel is now adding to that strain.” 

A Proposal for Immediate Relief

The Coalition has proposed halving the fuel excise, a move it says would reduce petrol prices by around 26 cents per litre. According to the Opposition, this could deliver noticeable weekly savings for households—particularly those reliant on vehicles for work or commuting.

Deputy Leader of the Liberal Party Senator Jane Hume reinforced the urgency, noting that fuel affordability is now intersecting with broader economic concerns.

“Families are starting to dread filling up their cars,” she said, describing the situation as a second layer of pressure on top of an already prolonged cost-of-living challenge. 

The Coalition maintains that the proposed tax cut would be “fully offset,” aiming to provide relief without adding further inflationary pressure.

Government Under Pressure—but Questions Remain

While the Coalition has framed the issue as one of leadership and urgency, the government has pointed to existing fuel supply levels and broader market dynamics.

Critics of the excise cut approach argue that reducing fuel taxes could stimulate demand without addressing underlying supply constraints. Others note that global factors—including geopolitical tensions and refining capacity—continue to influence domestic fuel markets.

There are also longer-term policy considerations at play. The government has emphasised its transition toward cleaner energy and electric vehicles, a direction the Opposition has criticised as out of step with current affordability pressures.

Supply, Transparency and Planning

Another emerging theme is transparency. Calls have been made for clearer, real-time information on fuel availability, including proposals for a national dashboard to track supply disruptions.

The issue has also reignited debate around Australia’s fuel security settings—particularly domestic refining capacity and reliance on imports.

Leader of The Nationals Matt Canavan argued that Australia should prioritise developing its own energy resources, framing the current situation as a warning about long-term supply resilience. 

The Bigger Picture

As Easter approaches—a peak travel period—the stakes are rising. Higher fuel costs not only affect households but also flow through to tourism, freight, and regional economies.

For Canberra and other urban centres, the issue sits within a broader conversation about infrastructure, planning, and cost pressures. Reliable and affordable mobility remains central to how cities function and grow.

Inside Canberra Perspective

What is becoming increasingly clear is that Australians are less concerned with political positioning and more focused on practical outcomes.

Short-term relief measures—such as tax adjustments—may provide immediate breathing room. But they sit alongside deeper structural questions about supply chains, domestic production, and energy transition pathways.

The coming weeks will likely test whether policymakers can balance urgency with long-term strategy.

A proposal from Opposition Leader Angus Taylor and Nationals Leader Matt Canavan to temporarily halve the fuel excise has reignited a familiar political divide: immediate relief versus long-term policy direction.

But beneath the politics lies a more uncomfortable question—how did Australia become this exposed in the first place?

A crisis that feels familiar

For many households, particularly in Canberra, the situation feels less like a sudden crisis and more like a slow-moving inevitability.

Fuel prices have surged again, driven in part by global instability, but also layered onto a domestic economy already under strain. The result is predictable: higher commuting costs, rising freight prices, and yet another squeeze on household budgets.

The Coalition’s proposal—cutting fuel tax by around 25 cents per litre for three months—would provide immediate relief. There is little serious dispute about that.

The real debate is whether it addresses the problem—or simply buys time.

Canberra’s unique pressure point

This debate lands differently in Canberra than it does in other capitals.

Despite its reputation as a planned city, Canberra remains heavily car-dependent. Public transport options, while improving, still fall short for many commuters—particularly those moving between town centres or working irregular hours.

That means fuel costs are not discretionary—they are structural.

For many residents, especially in areas tied to major employment corridors, a spike at the bowser translates directly into reduced disposable income. There is no easy substitute.

This is where national policy decisions become intensely local.

Short-term relief vs long-term direction

The Coalition argues the fuel excise cut can be funded through reprioritising spending, including scaling back electric vehicle incentives and renewable energy subsidies.

That framing is politically effective—but it also sharpens a broader tension.

Australia is attempting to manage two transitions at once:

• A cost-of-living crisis requiring immediate relief
• An energy transition requiring long-term investment

The risk is that policy begins to oscillate between the two, rather than resolving either.

Cutting fuel tax may ease pressure today—but it does not address supply chain resilience, fuel security, or long-term price stability.

Equally, maintaining current settings without relief risks ignoring the immediate reality facing households.

A distribution problem—or something deeper?

One of the more contested claims in the current debate is the issue of supply.

While the Government maintains there is sufficient fuel in the system, reports of empty or partially supplied service stations suggest something more complex is unfolding.

If fuel exists but isn’t reaching where it’s needed, that points to logistical or infrastructure weaknesses—not just global pressures.

And that raises a more strategic question: is Australia managing its fuel system reactively rather than proactively?

The political test ahead

For the Albanese Government, the challenge is no longer simply economic—it is perceptual.

Voters tend to judge governments not just on outcomes, but on responsiveness. Rising fuel prices are one of the most visible and immediate economic signals households experience.

For the Opposition, the proposal is politically straightforward: offer tangible, near-term relief.

But it also carries risk. Temporary measures can create expectations—and removing them later can be politically difficult.

Inside Canberra perspective

From an Inside Canberra standpoint, this debate highlights a recurring pattern in national policy:

Australia often waits for pressure to become acute before acting.

Fuel security, like housing and infrastructure, has been a known vulnerability for years. Yet meaningful reform tends to emerge only when conditions tighten.

The current proposal may well be justified as a short-term measure. But it should not be mistaken for a solution.

If anything, this moment should prompt a broader recalibration:

• How fuel is distributed across the country
• How resilient supply chains really are
• And how policy balances immediate relief with long-term stability

Because without that, the cycle is likely to repeat.

And next time, the pressure may be harder to absorb.

Canberra’s role as a hub for advanced technology and international collaboration was on display this week at the Australia–Japan Space and Cyber Forum, hosted at the Canberra Cyber Hub.

The event brought together government officials, diplomats, researchers and technology companies from Australia and Japan to discuss the rapidly expanding intersection between space technology, cybersecurity, and emerging technologies such as quantum and artificial intelligence.

Opening the forum, speakers highlighted Canberra’s unique strengths as a knowledge economy driven by universities, research institutions and advanced technology industries. The ACT’s strong cyber security ecosystem and growing space sector were repeatedly emphasised as key reasons international partners increasingly look to Canberra as a place for collaboration.

A central address was delivered by Isamu Yamaguchi, Minister at the Embassy of Japan in Australia, who outlined Japan’s rapidly evolving strategy in both cybersecurity and space.

Minister Yamaguchi emphasised that cybersecurity is no longer simply a technical issue but a core pillar of national security and economic resilience. Japan recently passed landmark legislation enabling a more proactive cyber defence approach to counter emerging threats and protect critical infrastructure.

He also highlighted Japan’s ambitious vision for its space industry, which aims to expand to ¥12 trillion (Approximately A$108 billion). in value by 2030 and generate around 100,000 jobs through satellite technology, space exploration and commercial space services.

Importantly, Minister Yamaguchi stressed that the future of space security is inseparable from cybersecurity.

“Space systems depend heavily on cyber networks,” he noted, warning that cyber-attacks on satellite systems could disrupt communications, navigation and critical infrastructure.

The Minister emphasised that Australia and Japan share common democratic values and strategic interests, and that cooperation between the two countries will be essential to strengthening security and technological capability across the Indo-Pacific.

Existing collaboration already includes intelligence sharing, joint cyber exercises and satellite data cooperation, including the use of Japanese Earth-observation satellites to support Australian bushfire monitoring.

Looking ahead, several areas of future cooperation were identified, including:

• quantum-secure satellite communications

• AI tools for space situational awareness

• joint research partnerships

• public-private collaboration in emerging technologies

• regional capacity building across the Indo-Pacific

The forum also showcased Canberra-based technology companies developing innovative solutions for national security and cyber resilience.

Demonstrations included supply-chain authentication technologies, drone detection systems and cyber security services supporting defence and critical infrastructure.

Participants agreed that Canberra’s growing ecosystem — spanning government, industry and academia — places the city in a strong position to become a regional centre for cyber, space and advanced technology collaboration.

As the Australia–Japan strategic relationship continues to deepen, the discussions highlighted how partnerships between the two countries will play an increasingly important role in shaping the future of security and innovation in the Indo-Pacific.

Senator Matthew Canavan Canavan has been elected leader of the National Party of Australia, calling the moment “extremely humbling” and pledging to fight for regional communities and a stronger Australian economy.

Speaking at Parliament House after the leadership vote, Canavan thanked outgoing leader David Littleproud MP for his service and highlighted the strength of The National Party of Australia new leadership team, including Deputy Leader Darren Chester MP and Senate Leader Senator Bridget McKenzie.

In outlining his vision, Canavan said Australia already has the resources, industries and people needed to meet its challenges and improve living standards.

“We’ve got everything we need here in this country,” he said, emphasising the importance of supporting Australian farming, manufacturing and jobs.

He said his focus as leader will be addressing cost-of-living pressures and ensuring regional Australians continue to have a strong voice in national politics.

The leadership change marks a significant moment for the Nationals as they look to shape the next phase of debate about Australia’s economic direction and regional development.

Intro

Let me start by asking a question. Do you feel better off today than you did a year ago?

I ask this question of many Australians, and I get a consistent answer.

Inflation hurts all Australians. The impact of inflation is not limited to some.

I witnessed this first hand growing up in Nimmitabel, a tiny timber and farming town, two hours south of here, in the 1970s and 80s.

In many ways this was the reason I became interested in economics. We were living it every single day.

I saw neighbours – good family businesses – making investments, growing their businesses and borrowing money only to see inflation and high interest rates devastating their plans.

Persistent inflationary pressure is the new crisis for the government to face.

Bringing down cost of living pressures and delivering long term economic growth is hard government, requiring hard choices, just like those the Coalition made during the pandemic.

COVID v Inflation

We all remember the challenge that was before us in March 2020. We probably would prefer to forget.

A crisis that required difficult decisions, required governments of all persuasions to challenge their instincts.

It required policymakers to respond to the demands of the time.

And do so quickly. There was no luxury of time.

That’s what we did.

And because of these policies, Australia achieved a remarkable v-shaped recovery and emerged from the pandemic in a better position than most or all countries we benchmark ourselves against, with:

• Record low unemployment.
• Record numbers of apprentices in training.
• And a Budget that from the moment the east coast states re-opened was in surplus.  

From November 2021, when Victoria and NSW left lockdown, to today – the Department of Finance has published 17 months of financial accounts.

The monthly figures show that from the moment the east coast emerged from lockdown and travel restrictions began to ease, the government has experienced a net Underlying Cash Balance surplus of $33 billion dollars.

As respected economist Chris Richardson has pointed out, net debt to GDP has returned to where it was prior to the pandemic. 

But just as the pandemic crisis required constant adaptation and response, so does the current environment.

With inflation raging across our economy, this is the crisis this government has to deal with. 

Hardworking families are climbing a mountain day-in day-out to pay the bills and support their children.

A typical family paying off their home is $25,000 worse off than they were a year ago – hit hard by higher mortgage costs, taxes, energy bills and other costs of living.

Families like Nicole and Dougie from Goulburn.

Raising two children in a home they recently bought.

They are paying an additional $890 on their mortgage every month.

And while their increases are less than many, Nicole is facing the possibility that she might have to go back to work earlier than she had thought after her second child, just to help make ends meet.

Then there’s Cory and Sarah – young parents working hard to pay off their home in Perth.

They are everyday victims of inflation, struggling under the pain of rising interest rates, higher grocery prices and skyrocketing energy bills.

Cory said “what this Budget has said to all Australians … is … the government hasn’t listened to any of us … there is no help for us in this Budget.”

Small business owners Brianna and Alex are feeling the pinch of rising expenses due to high inflation.

The parents of two have had to pull back on hiring extra staff and cut back hard on their own spending.

These are just a few examples of working couples faced with difficult decisions so they can keep paying the bills and putting food on the table.

The choices are stark: Do they pull their children out of sport or cancel the annual family holiday?

Does dad take on a second job or weekend work or does mum go back to full time work while the kids are still babies?

Lifeline reports that 80 per cent of its calls now relate to cost-of-living pressures. 

Deloitte Access Economics estimates that approximately 300,000 Australians are living in negative cash flow. 

High inflation means that hard working Australians who want to get ahead are only going backward.

It risks the creation of a new generation of working poor.

Inflation Economics is different

There’s a deep conflict between our current economic context and the economic ‘orthodoxy’ many have supported in recent times, particularly during the pandemic.

We’ve become accustomed to hearing from our political opponents that more government and more spending is the solution to most economic challenges.

But inflation economics is fundamentally different.

Big government makes the situation worse.

American economist Eric Leeper has documented the many mistakes governments made through the 60s and 70s that led to inflation getting out of control and remaining untamed.

The mistakes can be characterised very simply – governments responding by treating the symptoms of inflation, not the source.

This Budget makes that mistake.

It gives with one hand, while taking away with the other through higher prices and higher taxes.

It means the Reserve Bank is slamming the brakes at the same time as the government has its foot on the accelerator.

And when you do that – you wreck the engine.

A year into this Government, Australia has one of the highest rates of core inflation amongst major economies. At 6.6%, Australia’s core inflation is higher than the UK (6.2%), the US (5.6%), Canada (4.3%) and the Euro Area (5.7%). 

Headline inflation remains stubbornly high, particularly in our services sector.

The RBA’s latest monetary policy decision should have rung like an alarm bell through the government about the urgency of the challenge. 

Australians are making hard choices every day. Yet they are not seeing in the government a willingness to do the same.

Inflation is coming from Canberra now, not from the Kremlin, and so it’s Canberra’s problem to solve.

Inflation will be stronger, for longer, if governments deny the problem and adopt the wrong solutions.

While many argue that the principles that have driven Coalition economic policy have become less relevant than in the recent past, the values that drive us give us the right toolkit for the times.

• We believe that private business drives opportunity and prosperity – not big government.
• We believe in fiscal discipline to take pressure off prices. Lower taxes, balanced budgets and spending growth restraint.
• We believe that productivity reforms are the key to making life easier, removing supply side constraints and setting our economy up for longer-term growth.
• And we believe in backing hardworking, aspirational Australians to get ahead. To lift all Australians together.

This is the pathway back to a low inflation, high growth economy.

But by focusing on the symptoms, the Budget divides Australia into the worthy few and the forgotten. The forgotten being:

• Small businesses
• Middle income families
• Mortgage holders
• Farmers
• Truckies
• Regional communities
• And others

Less inflation is good for all Australians, not just a few.

Rather than dividing the country, you bring it together, giving all Australians a pathway to more prosperity.

Giving Australians every opportunity to fulfil their own goals.

This is what Peter Dutton outlined in his Budget Reply.

Peter also clearly laid out that while there are differences in the approach we would take, there are also places where we can find common ground with the government on.

We have again reiterated our support for ensuring the NDIS is sustainable into the future. As we did with the RBA review – I think very well – this is something that we are prepared to work with the government to achieve.

The NDIS is too important – securing its future should be above politics.

Fiscal restraint and supply side measures take pressure off prices

Well ahead of this Budget we were clear on the need fiscal restraint and other sensible measures to take pressure off all Australian households and businesses.   

It was a simple test for Labor and any Party that seeks to claim it can manage the economy.

Instead, we saw the opposite:

• $185 billion in new spending since Labor came to office.
• $2 of new spending initiatives for every new dollar of revenue initiatives.
• Poorly planned migration that the Treasurer’s own Budget papers say will drive up housing costs.
• A fiscal strategy that removed “fighting inflation” from what was already called “the weakest fiscal strategy in living memory” (as Steven Hamilton has said)
• A failure to heed the calls of major business groups and economists to restore the fiscal guardrails that had been in the fiscal strategy since 1996 including a commitment to Budget balance.

As has been pointed out by the Australian Financial Review’s John Kehoe, this Budget even walks away from the Treasurer’s one fiscal rule in the last Budget.

Far from returning 99 per cent of revenue windfalls to the bottom line, as promised in October, the government has banked just 40 per cent of improvements in the budget bottom line since PEFO, and spent 60 per cent of the massive windfall from strong commodities and job markets.

No one wins from a big spending government in an inflation crisis.

At best the Budget fails to address inflation.

At worse it adds fuel to the fire.

There is a credible case that it is making it worse.

Rich Insights director Chris Richardson said he: “had thought that the Reserve Bank was done and dusted but this has notably raised the chance that they will do another swing of the baseball bat”.

S&P Global Ratings disputed the Government’s forecasts, stating: “We expect inflation to be stubbornly higher than the Reserve Bank of Australia’s target until fiscal 2026” and that “handouts in today’s budget may add to inflationary pressures.”

Betashares Chief Economist David Bassese called the Budget “unambiguously expansionary.” 

It is concerning to see the Treasurer, who has spent more time spinning budgets than studying them, dismissing the views of economists so easily. 

Meanwhile, the government seems to have spent the last week trying to work out who this budget is supposed to help – rather than being focused on it from the start.

Middle Australia was not spoken of in the lead up to the Budget or in the Treasurer’s Budget speech and yet, in the post-Budget wash-up, the Treasurer mentioned “middle Australia” 41 times.

The Prime Minister? 15 times in his media appearances and counting.

Labor can try and spin its way out of a Budget failure but it won’t change the fact that there is no light at the end of the tunnel for hardworking Australians who are trying to get ahead.

Given the strength of commodity prices, the jobs market and the trend of monthly surpluses coming out of the pandemic, it’s been clear a drover’s dog could have delivered a surplus this year.

It is essential the government do so next year.

It is also within reach to deliver ongoing budget balance. This is the test for Labor.

It’s not easy. But it can be done. We did it.

Prior to the pandemic, the Coalition balanced the Budget.

We did this while increasing spending on essential services, growing Defence spending to over 2% of GDP and supporting the creation of more than 1 million jobs and 250,000 businesses. 

Simpler and lower taxes

The path to fiscal consolidation is not to tax Australians more.

Labor’s fiscal strategy sets no cap on tax growth and contains no commitment to private sector-led growth.

This is the wrong strategy.

Higher taxes stifle investment, innovation and aspiration.

As economist Alberto Alessina has shown us, tax driven fiscal improvements damage growth compared with containing spending growth.

Put simply, you cannot tax your way into economic prosperity, just as you cannot spend your way out of high inflation.

Australians struggling with the cost of living will see taxes rise on top of ever-increasing prices.

But worse – some of these taxes are bound to be passed right on to consumer’s bills:

• The truckie tax adding to the cost of food and freight;
• $153 million tax on our farmers
• Labor’s franking credits and super taxes will be directly felt by self-funded retirees and pensioners alike.
• And bracket creep, the tax you don’t notice until you look at the impact on your bank account, is eating away at Australians earning power. The Budget papers show income tax as a percentage of GDP growing over the forwards.
• Over the next five years, the tax paid by Australians will increase by more than $300 billion.

This Budget has abandoned tax incentives that support innovation, investment, and productivity that grow the economy.

• The patent box regime has been abandoned.
• The Technology Investment Boost has not been extended.
• And while we welcome the retention of the Instant Asset Write Off, the government has decimated its asset value cap and removed access to the investment allowance for medium-sized businesses.

Labor’s big spending, high taxing, high regulation agenda risks putting us in to a period of stagflation.

Inflation and low economic growth are a dangerous combination.

It’s why the Coalition is committed to restoring the same fiscal rules that delivered lower taxes and a balanced budget in 2019.

• It is why the Coalition is committed to restoring the tax-to-GDP cap.

• It is why we are committed to delivering the stage 3 tax cuts.
• And it is also why we will continue to fight Labor’s broken promises on taxes to superannuation and franking credits.

The Path To A Low Inflation, High Growth Economy

Strong economic growth over the short term and the longer term is essential to boosting quality of life.

At a time where inflation is making quality of life worse, productivity gains are the only pathway to ensure Australians can realise their aspirations.

Making it easier to do a job or run a business.

Making it easier to for customers to get a better deal or to engage with government services.   

The McKinsey Global Institute has highlighted that productivity reform is essential to solve the challenges confronting most advanced economies – ranging from labour market shortages, debt, inflation, and energy.

The Reserve Bank minutes from April have sounded the alarm on productivity, but the government isn’t listening.

The government talks a lot about productivity to justify billions of extra expenditure.

Yet its own Budget shows a deteriorating productivity position, despite the spending.

The Productivity Commission’s five-year review, has been all but buried with not a single measure in Budget Paper No 2 a direct response to the recommendations made.

Worse, the Budget throws up challenges to productivity and economic growth, particularly when it comes to people and energy.

People – Migration 

The Budget has the Australian population growing by substantially more than the size of Adelaide over the next five years. But with no plan to address housing supply and infrastructure needs.

We all support a well-planned migration program – and that’s the history of Coalition governments.

But over five years, net overseas migration will see our population increase by 1.5 million people.

It’s the biggest migration surge in our country’s history and it’s occurring amidst a housing and rental crisis.

Migration is an enormous part of our history and has been critical to our economic success, our culture, our lifestyles and who we are.

I saw the power of aspirational migrants as a kid growing up near Cooma in the Snowy Mountains – one of the proudest migrant communities in the nation.  

More than 100,000 people from over 30 countries travelled to the Snowies after the Second World War to work on the Snowy Hydro Scheme.

While migration will continue to serve us well into the future, it only works if you have a plan around the infrastructure, the housing and the services. 

Instead the government is cutting infrastructure spending in real terms and reallocating to pet projects.

People – JobSeeker

If you talk to any business big or small and they will tell you one of the biggest supply constraints in the economy remains labour shortages.

We have record job vacancies – more than 435,000.

Alongside managed immigration, there is an opportunity to give more Australians the incentive to get into work, or increase their hours.

A high proportion of the 550,000 unemployed Australians are capable of working 30 hours or more.

There is nothing like getting a job to improve someone’s life.

Australians on Jobseeker face effective marginal tax rates of up to 60c. This is a disincentive to work at a time the economy and Jobseekers cannot afford it.

It’s why Peter Dutton announced our proposal, to increase the amount a JobSeeker recipient could earn before their payment is affected.

This is a common sense policy that could boost the income of someone on JobSeeker that works not by $40 a fortnight but by up to $300.

It is similar to the Pension Work Bonus reform we championed, and the government ended up implementing a version of last year.

We have suggested this in a bipartisan, constructive way because we think that this is ultimately better for those on JobSeeker but also better for the country.

Energy
Another major barrier to growth is energy prices going in the wrong direction, alongside Labor’s attacks on the gas sector. A sector we need to support lower emissions and lower energy prices.

Between the gas caps, the PRRT, the safeguard mechanism, delayed approvals and the abandoning of carbon capture and storage incentives – one of our largest export industries is under attack from this government.

It’s a death by a thousand cuts for an industry that has powered our nation and the economy for so many years.

Meanwhile, most hardworking Australians will not benefit from a cent of the government’s cost-of-living relief despite power bills still increasing by more than $500.

Our answers

A more prosperous Australia demands a sharp focus on a low inflation and high growth economy.

In Peter Dutton’s Budget Reply, he made several downpayments on an agenda that will promote growth in the medium-term:

• Supporting gas as a medium-term energy source and removing barriers to nuclear energy;
• Restoring mental health sessions to Medicare so Australians can be healthier at a time of crisis for many;
• Committing to a tax-to-GDP cap that will incentivise productivity in government;
• Repealing Labor’s super tax.

The starting point for real action on productivity is to take action to support businesses to lower costs and keep employment low. 

Conclusion

A dollar today is worth less than it was a year ago.

And this government’s policies risk inflation and interest rates that are higher for longer, prolonging the pain.

Australians trying to get ahead will be the ones who pay the biggest price.

The Coalition has been clear that we would not have delivered this Budget.

Our priority would be to bring down inflation and set up Australia up for growth in the medium-term through lower taxes and productivity enhancing policies.  

This would take pressure off prices and prevent a generation of Australians becoming the working poor.

It would support the Reserve Bank by having fiscal policy pulling in the same direction as monetary policy.

And it would set all Australians up for the future they deserve.

Below are some photos and text from the night.

Innes Willox – Chief Executive of the Australian Industry Group

While fiscally prudent, this year’s Federal Budget unfortunately lacks the urgency and imagination required to power the Australian economy through a period of anaemic growth, Innes Willox, Chief Executive of the national employer association, Ai Group, said tonight.

“It offers little to kickstart the structural reforms needed to boost productivity, investment, innovation, job creation and sustainable real incomes growth,” Mr Willox said. 

Read full text at the Ai Group website.

AMA President Professor Steve Robson

I’m Steve Robson, Federal President of the Australian Medical Association. Around the country, Australians have understood that our health system is in crisis and that affordable and accessible care with GPs has been very difficult to find and it’s getting worse. So we absolutely welcome to light a lot of the initiatives in this Budget.

Read full text at the AMA site.

National Seniors Australia Chief Advocate Ian Henschke

Henschke’s message was ‘Simpler system’ needed to ‘attract and keep’ seniors in the workforce

Helen Dalley-Fisher, ERA Convenor, said “This budget is a move in the right direction for women – it has its heart in all the right places. This Government seems to understand that we need deep structural change to our economic and policy systems to make real change for women. Although there is much more that could be done, we’re not seeing anything tonight which moves in the wrong direction.”

Read more at the Equality Rights Alliance site.

Dr Nicole Higgins, President of the RACGP

The Royal Australian College of GPs (RACGP) has welcomed the federal Budget as a game changer for GPs, practice teams and the patients they care for across Australia.
RACGP President Dr Nicole Higgins said the Budget is a win for patients.

“Every patient deserves access to high-quality, affordable and accessible general practice care, irrespective of their postcode or income,” she said.

“I commend the Albanese Government for committing to this massive investment in general practice care. We know the problems impacting our health system can’t all be fixed in one go, but tonight’s Budget includes a groundbreaking investment in the health of all Australians by strengthening general practice care. The Government has shown real commitment to strengthening Medicare and rebuilding general practice care for all patients.”

Read more at the RACGP site.

Melissa Donnelly National Secretary of the Community and Public Sector Union

Melissa Donnelly tweeted – 10,800 APS jobs (6% increase) across the APS Big outcomes in NDIA, ATO, Climate Change, Agriculture, DVA and more. After a decade of attacks and cuts to the public service, tonight’s investment will make a real difference.

Australian Conservation Foundation, Chief Executive Officer, Kelly O’Shanassy

Federal Budget 2023-24 contains ‘the good, the bad and the timid’, according to the national environment group, the Australian Conservation Foundation.

“The Albanese government is making good, solid investments in the clean energy revolution with funds to build transmission infrastructure, attract clean capital to Australia and help workers through the energy transition,” said ACF’s CEO Kelly O’Shanassy.

“ACF welcomes the $2bn Hydrogen Headstart program to accelerate the development of Australia’s clean export industry.

Read more at the acf.org.au site.

John Grimes, CEO Smart Energy Council

“Finally genuine action to harness the benefits of renewable energy and grow our economy through investing in Australia’s cutting-edge smart energy industry.”

2023-24 Federal Budget response from John Grimes, Chief Executive, Smart Energy Council:

“We are seeing the first steps on the path to Australia becoming a renewable energy superpower. Tonight the Federal Government has funded the establishment of a renewable hydrogen industry in this country,” said Smart Energy Council Chief Executive, John Grimes.

Read more at Smartengergy.org.au

Rewiring Australia co-founder and chief scientist, Dr Saul Griffith

Rewiring Australia co-founder and chief scientist, Dr Saul Griffith, said this budget is a profound reset of climate and energy policy after a lost decade under the previous government.

“This is Australia’s first electrification budget. It positions us to become a world leader in the efficient electric energy system of the future. It demonstrates federal ministers have worked hard to start the massive shift towards a new energy paradigm across the economy,” Griffith said.

“The electrification budget builds on Australia’s love affair with rooftop solar. It will help households to realise cost savings from substituting expensive gas machines for clean, electric alternatives.“

Australian Local Government Association (ALGA) President Cr Linda Scott

Australian councils have welcomed tonight’s Federal Budget as a solid investment in local government, with councils receiving $3.1 billion in Financial Assistance Grants over the next 12 months.

“For Australia’s 537 councils, $3.1 billion of local government funding is a vital investment in Australia’s productivity, allowing us to employ nearly 200,000 Australians and provide local services in every corner of the nation,” said Australian Local Government Association (ALGA) President Cr Linda Scott.

Read more at the Australian Local Government Association site.

Jo Briskey, National Political Coordinator at United Workers Union

Major Budget measures announced today show the Albanese Labor Government implementing a bold reform agenda to address issues facing low-paid workers in the midst of a cost-of-living crisis, United Workers Union said today.

Read more at the United Workers Union site.

Matthew Addison, Chair The Council of Small Business Organisations Australia (COSBOA)

Small businesses play a vital role in the Australian economy, employing millions and generating income for countless individuals and business owners. A healthy small business environment is essential for a vibrant and thriving community. The 2023-24 Federal Budget acknowledges small business, but there is a need for greater focus on empowering them, promoting entrepreneurship and providing enhanced reasons to commence and remain in business.

Read more at the COSBOA site.

Marc Purcell, CEO, Australian Council for International Development

The Australian Council for International Development (ACFID) welcomes the 2023-24 Federal Budget’s measures towards improving Official Development Assistance, describing them as “responsible and sustainable.”  

While the Budget contains only modest immediate measures aimed at boosting ODA, ACFID recognises the Government is devoted to sequenced increases of 2.5 percent per year over the longer term from 2026-27 onwards.  

“One year in, these measures place Australia’s aid program on stable footing for the future,” said ACFID CEO Marc Purcell. 

Read more at the Australian Council for International Development site.

See more political photos at – Rob Keating Photography