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Costello's inflation credentials in tatters.

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Simon Crean - Costello's Inflation Credentials In Tatters Thursday, 26 April 2001

Costello's Inflation Credentials In Tatters Simon Crean - Shadow Treasurer

Media Statement - 24 April 2001

Today's higher than expected 6 per cent inflation rate has smashed Peter Costello's credentials as an economic manager.

Once again he has tried to blame special "one-off" factors - the weather, foot and mouth disease, kids going to school, even his own GST - anyone and anything but the Howard Government.

If you take out everything that has gone up in price, you do get a low inflation rate. But that's the fantasy of a person out of touch with the experience of Australian families paying for his high inflation policies.

The cold hard truth is that when the GST was introduced, it resulted in the largest quarterly increase in inflation since John Howard was last Treasurer and pushed the inflation rate to 6.1 per cent. It's been there ever since.

Contrary to the Treasurer's claim that this is all a "one-off" the Australian Statistician's measure of inflation excluding volatile items (the "one-offs") rose 0.8 per cent in the quarter and 5.5 per cent for the year.

The Australian Statistician today revealed that in the first three months of this year, prices rose in the areas of:

Food (up 3.1% in the quarter and up 6.6% in the year) ● Health (up 2.8% in the quarter and up 3.9% in the year) ● Pharmaceuticals (up 9.3% in the quarter) ● Education (up 4.2% in the quarter) ●

The rise in pharmaceuticals comes as the Government prepares to make diabetics and those suffering from cholesterol pay even more, as revealed in the leaked Budget document from the Prime Minister's department.

Earlier this year, Peter Costello pointed to the rise in retail sales (turnover) figures as evidence the economy was recovering. It is now clear from today's rise in inflation the lift in retail sales were due to

higher prices. In other words, Peter Costello was taking credit for boosting prices.

While Peter Costello may like the luxury of "looking through" these price rises, Australians paying more for their kids' education; their medicines; and their food don't have that luxury.

Costello's Inflation Hit On Australians

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Authorised by Geoff Walsh, 19 National Circuit, Barton ACT 2600.

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