The timing could not have been more awkward. Questioned in Senate Estimates over the government’s fiscal trajectory on Wednesday morning, Finance Minister Katy Gallagher defended Labor’s near-record public spending, claiming it was for “good reasons”. Shortly after those remarks, the September quarterly inflation data was released revealing that headline inflation had jumped from 4 per cent to the higher-than-expected 4.3 per cent.
Higher inflation adds fuel to the political fight over whether government spending is feeding sticky inflation. Under Labor, federal government spending has jumped to almost 27 per cent of GDP, the highest in 40 years excluding the pandemic.
Gift articles to anyone you choose each month when you subscribe.
