The one question Jim Chalmers can’t answer as Aussies face skyrocketing electricity, petrol and grocery bills just weeks out from Christmas
- Inflation in the year to September rose by 7.3 per cent – fastest pace since 1990
- Another rate rise is expected on Tuesday, as experts predict a 0.5 per cent jump
- But the Treasurer could not answer the one question everyone wants to know
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Australians are facing some of their worst bill shock ever with electricity prices skyrocketing, the war in Ukraine driving petrol prices up and inflation surging to 7.3 per cent in the year to September.
Inflation is rising at its fastest pace since 1990 with another price shock on the way as Westpac predicts yet another 0.5 per cent rate rise on Tuesday.
With the rising cost of living firmly on his mind, Federal Treasurer Jim Chalmers put on a charm offensive on Sunday morning when he appeared on ABC’s Insiders.
But there was one question Mr Chalmers could not answer – exactly when Australians may get some relief from skyrocketing bills.
Federal Treasurer Jim Chalmers (pictured) could not answer the one question on everybody’s mind when he appeared on ABC’s Insiders program on Sunday
People are increasingly concerned at the price of petrol. Pictured is a woman filling her car at Edgecliff Road in the Sydney suburb of Bondi Junction
If Westpac’s forecast of a 0.5 per cent rise on Melbourne Cup Day proves accurate, it would take the interest rate to a 10-year high of 3.1 per cent.
A borrower with a typical $600,000 loan would see their monthly repayments climb by another $181 to $3,236.
Mr Chalmers talked around the issue on Sunday, saying the government was ‘always recalibrating our expectations for electricity price rises’.
‘We had a choice to make, to be upfront about what’s happening in these energy markets or not, we chose to be upfront,’ he said.
‘We think it’s crucial we do that so we examine, shine a light on the important work that now needs to happen and part of that work is investing in new sources of cleaner and cheaper renewable energy.’
Mr Chamlers told Insiders host David Speers that the government was ‘making progress every day’.
‘We are working quite hard on this challenge not just since the budget but before it as well,’ he said.
But Speers pressed him on when there would be a solution to higher prices.
‘I’m not going to give you a date today, David, but I can indicate to your viewers that it’s obviously a high priority for us,’ Mr Chalmers replied.
‘It is a bigger and bigger part of the inflation challenge that we confront more broadly and government will work as hard as we can to get an outcome here as soon as we can.’
Families in Australia are concerned they won’t have as much to spend at Christmas as they’d like due to high inflation. Pictured are shoppers in a Sydney supermarket
Inflation in the year to September surged by 7.3 per cent – the fastest pace since 1990
Mr Chalmers was then asked when energy prices would specifically start to come down.
‘We tried to be up front about the composition of this inflation challenge and the fact that because of the war in Ukraine electricity prices and gas prices will become a bigger part, a bigger component of this inflation challenge,’ he said.
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Mr Chalmers said natural disasters, such as flooding, were also pushing up the cost of living.
‘This is what we are expecting… the 20 per cent (rise in energy bills) number is already flowing. It’s actually partly a consequence of the rises that (former energy minister) Angus Taylor hid during the election campaign,’ he said.
‘So we need that perspective too. We expect (a) 20 per cent (rise), then (a) 30 per cent (rise).’
Speers interrupted Mr Chalmers to say ‘we heard about this during the week, when will prices come down?’
Mr Chalmers’ response was unlikely to have calmed the nerves of Australians wondering how much they may be able to save before Christmas.
‘We have provided the near term forecast, the 20 per cent and the 30 per cent (rise). That covers this year and next year,’ he said.
‘Obviously as we invest more in cheaper and cleaner forms of energy, obviously depending on what regulatory interventions we can sensibly make in the near term, that will have an impact.
‘But I think most importantly for families and for Australians and for Australian industry we do expect prices to rise this year and next year.’
The Insiders host then put it to Mr Chalmers that he didn’t know when prices would come down.
‘Well, we know that they will moderate in time and we know that we give ourselves the best chance to do that by investing in new sources of cleaner and cheaper energy, which is the government’s priority,’ Mr Chalmers replied.
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