Chalmers hints at what’s in October budget

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Growing economic challenges are in the mind of the Albanese government as it sells its likely approach to the federal budget.

Treasurer Jim Chalmers told ABC News that the national accounts released yesterday provided evidence of a “pretty encouraging, pretty solid outcome” but that it showed the beginnings of factors contributing to the rise in inflation.

Chalmers said the national accounts were put together two months ago and since then interest rates have gone up further, with an accompanying greater deterioration in the global situation. The national accounts for the June quarter revealed that the economy grew by just under 1% and that the growth was in consumption and net exports.

“So, I think it’s possible to recognise that we had a pretty solid, relatively strong June quarter in those national accounts for the economy, but people are under no illusions about the rocky terrain that we have to climb for the next six or 12 months,” Chalmers said.

The treasurer is set to table a budget in late October, and he said it will have specific cost-of-living relief measures.

“When we provide responsible cost‑of‑living relief in the budget next month, which I will do, we want to make sure it also delivers an economic dividend,” he said. “So childcare obviously eases people’s cost‑of‑living pressures but also delivers a big economic dividend when more parents, and especially more mums, can return to work if they want to.

“Making it cheaper to go to TAFE obviously has implications but is also good for the economy. Cutting medicine costs as we intend to do – all of these things are important ways to ease people’s cost of living without adding to those inflationary pressures because it delivers an economic dividend.”

Chalmers and finance minister Katy Gallagher have been reviewing budget line items. One of the early culls announced publicly is the $18 million funding planned for a leadership program advocated by governor-general David Hurley.

The Australian Future Leaders Program had funds allocated to it via a regulation and the $18 million funding plan faced two disallowance motions – one for each chamber of parliament – aimed at killing it off.

Motions of disallowance have been rendered unnecessary following the federal government’s indications that the multimillion-dollar injection of funds into the leadership program would not proceed.

“What we’re doing is we’re going right through the budget line by line to make sure that we’re getting value for money for some of the commitments in the budget. And that one didn’t pass muster from our point of view and so we won’t be providing that $18 million or the ongoing funding after that as well,” Chalmers said.

“We have to take some difficult decisions in the budget. There have been some funds committed which will not be proceeding and that’s an example of that. And there will be other examples, too.”