Shadow treasurer Ted O’Brien has rejected Labor’s claim that private demand is driving inflation, blaming excessive government spending instead.
Shadow treasurer Ted O’Brien has accused the federal government of fuelling inflation through excessive spending, disputing Labor’s claim that private demand is the main driver.
Speaking on RN Breakfast, O’Brien said he accepted comments by Michele Bullock that both public and private spending were rising, but argued government outlays were the dominant problem.
He said government spending had grown at around four times the pace of the economy in the past financial year and about twice the pace this year.
O’Brien said the opposition would impose tighter fiscal rules if elected to rein in spending growth.
He identified cuts to the electric vehicle fringe benefits tax exemption and the Net Zero Authority as priority savings, estimating they would deliver around $5bn in reductions.
Labor has repeatedly rejected opposition claims that government spending is the primary driver of inflation, pointing to Reserve Bank commentary highlighting strong private demand.
