Chalmers takes credit for S&P’s affirmation of Australia’s ‘AAA’ rating

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International credit ratings agency S&P Global has kept Australia’s credit rating at ‘AAA’ and the federal government is rather chuffed about that.

Treasurer Jim Chalmers said yesterday that the government viewed the ratings agency’s announcement as an endorsement of the government’s budget released last October and its economic plan.

Chalmers also said the agency bumped up the fiscal assessment score from two to one.

“The report highlights the economy’s strong fundamentals, including our historically low unemployment and the good prices we’re getting for what we sell to the world,” Chalmers said.

“This — along with the beginnings of wages growth after a decade of stagnant wages — are reasons to be optimistic about our economy’s future despite the challenging global environment.

“Australia’s strengthening fiscal position is a result of our responsible fiscal management, which returned the majority of revenue upgrades to the budget while restraining growth in spending.”

Chalmers’ statement on the S&P Global announcement also spruiked the government’s “fiscal repair”.

“We returned 99% of the upward tax revisions for the next two years to the Budget when the inflation challenge is most severe, and 92% over the forward estimates. This compares to around 40% under the former government,” Chalmers said.

“The government’s spending discipline means payments are forecast to fall in real terms over the next two years. Real spending growth is expected to average just 0.3% per year over the forward estimates.”

Chalmers also said that there were only nine countries in the world to have a ‘AAA’ rating from the three major credit agencies.

“The S&P report is a reminder of the importance of our responsible economic management, especially in these uncertain times,” he said.

News of the maintenance of the ‘AAA’ credit rating from S&P Global is good news compared with the inflation figure of 7.8% the treasurer fronted the media to address last week.

“This is very high inflation by historical standards, there is no use pretending otherwise — it’s unacceptably high,” Chalmers said.

“It’s in line with the Treasury forecasts for inflation and it’s almost as high as the Reserve Bank’s forecast for inflation as well.”

The board of the Reserve Bank of Australia will meet for the first time this year on February 7 and announce a decision on interest rates next week.

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Coalition takes credit for Australia’s ‘AAA’ credit rating