Wednesday, 4 November 2026

Topics: interest rates; inflation; spending.

E&OE……………………..

Sally Sara: Turning to the Opposition now, Tim Wilson is the Shadow Treasurer and joins me now. Tim Wilson, welcome back to the program.

Tim Wilson: Thank you for having me.

Sally Sara: The RBA Governor, Michele Bullock, says interest rate changes take time to flow through the economy, and the last couple of hikes haven't started to do that as yet. Should Australians be patient and have faith?

Tim Wilson: Well, Australians need hope right now, but what we've got is a government that's addicted to spending, and we've just heard it there where the Minister won't even acknowledge the problem. For every $2 they claim in savings, they go on and spend another $3. That's why we have persistent inflation. One of the things that's most concerning out of yesterday's rate rise is not just that rates have gone up for the fifth time this year. The RBA flagged that they're basically going to stay here for the full of next calendar year, which means Australians are going to pay more on their mortgage, they're going to go to the supermarket, they're going to pay more, and they're going to get less.

Sally Sara: Is private demand in the Australian economy contributing more to the inflation challenge than public demand?

Tim Wilson: Well, public demand is absolutely driving a lot of the problem Australians are experiencing right now. Now, some public demand or public spending goes through and becomes private demand, and so that's why government spending and how the government goes about it has such an impact on the inflation pressure. The government has basically acknowledged that. They like to talk now about savings while concurrently saying that there's no real link between public spending and inflation, but if there wasn't, they wouldn't be looking for savings. This is the fundamental problem: the government isn't prepared to admit the nature of the problem and therefore outline the pathway to address it and to get inflation pressure down and interest rates down.

Sally Sara: You're listening to Breakfast. My guest is the Shadow Treasurer, Tim Wilson. The Coalition's economic policies include significantly increasing defence spending and cutting personal income tax through the Tax Back Guarantee. They would increase inflation, wouldn't they?

Tim Wilson: Well, not if we provide the sorts of offsets we've already started to outline. We've outlined $31.3 billion of savings, specifically because we understand we've got to address the problems of inflation, and we also need to get the private sector moving. One of the biggest problems we have, and this came out very clearly in the data yesterday, is government is growing faster than the private economy. That just continues to stoke inflation. And the RBA Governor in their forward guidance yesterday warned Australians that we are at risk of higher unemployment, 5.1% by the end of next year, low productivity, and real wages continuing to go backwards. When you get that environment, you get a toxic mix which means Australians will feel worse off, be living lower standards of living, at a time when people desperately need hope.

Sally Sara: Is the Coalition willing to put forward and support cuts that may have negative consequences for Australians who feel that they are struggling economically right now?

Tim Wilson: We've already put forward $31.3 billion of savings for bureaucracies that don't achieve their outcomes, a focus on making sure that we cut organised crime and illicit tobacco. The government is not prepared to go along with any of those measures. We wrote to the Prime Minister at the start of this year and said, let's have a bipartisan solution to cutting spending. The only focus the Albanese Government seems to bring to cutting spending is cutting healthcare for pensioners, and they're not focused on how they're going to get the budget back…

Sally Sara: I want to ask you about that. If the task of finding savings is such a priority, why is the Coalition blocking policies that would save billions of dollars, which includes bringing concessions for older Australians' private health insurance rebate in line with the same concession that under-65s get?

Tim Wilson: Because it's false economics. People consume most of their healthcare expenditure in the latter stages of their life. We need more older Australians taking up private health insurance, not fewer. If you do, you're pushing more cost onto the taxpayer. This is just Labor trying to find a pathway to target older Australians again, rather than focusing on what will bring the budget sustainably back into a position and, more importantly, drive private sector growth.

Sally Sara: In the past couple of weeks, as you say, the Coalition has put forward $31 billion in proposed spending cuts, but the government also points to the fact that the Opposition has policy promises that are not fully costed. Will it be some time, i.e. much closer to the election, before we get those costings from the Opposition?

Tim Wilson: Well, what we want to see firstly is the next two federal budgets that will be handed down by Jim Chalmers or whoever the Prime Minister replaces him with before we can say clearly what's going to be in what would be our first budget or the third one after that. But our absolute intention is to provide full costings, because we understand that if you want to get inflation down, if you want to get interest rates down, if you want to give Australians economic hope, what we need is a rebalancing of the budget that's back focused on growth, back focused on growing the economy for Australians to improve their living standards, not what the RBA outlined yesterday, which is under this government, we're going to have rising unemployment, rising inflation, rising interest rates, and lower standards of living.

Sally Sara: We've seen Cotality data this week showing that housing values are falling further yet again. This could be a one in four-decade drop in prices. Is that a good thing?

Tim Wilson: Well, I think it's very challenging when we see the wealth and wages of Australians going backwards. We've seen that Cotality data which says that Australians who have bought a home will be worse off as a consequence. We're not seeing the new construction, the RBA data outlined yesterday that there'll basically be a completion of existing housing, and then new housing is falling off a cliff because of the Labor Government's tax changes, and of course, we're seeing real wages go backwards. So, in an environment where we're seeing the wealth and wages of Australians going backwards, I'm not opening champagne corks at all, because I think it's a disaster for Australians despite the celebrations of the Albanese Government.

Sally Sara: Tim Wilson, we'll need to leave it there. Thank you for your time this morning.

Tim Wilson: Thank you.

[ENDS]