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More Costello indifference to likely rate rise.

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Wayne Swan MP Federal Labor Shadow Treasurer

13 February 2005


Peter Costello’s refusal to rule out a leadership challenge this morning is another clear indication that his eyes are on the Lodge, rather than on the impact of a likely rise in interest rates on family budgets.

In an interview this morning he first denied the Government had embarked on a $66 billion spending spree to buy a fourth term, then denied that a spending spree of this magnitude would put upward pressure on interest rates.

Both claims are deceptive and dishonest, and are contrary to the views of respected economic commentators.

Access Economics and the budget papers themselves have shown that the spending spree during the election year was an extraordinary $66 billion.

Peter Costello’s claims that less was spent on the Coalition’s bid for re-election reflects a sensitivity on his part that he failed to stand up to the Prime Minister who wrecked his budget.

His second dishonest and deceptive act was to deny that the Government’s lack of fiscal restraint is one reason why interest rates are expected to rise in the first part of this year.

Economists agree the spending spree is putting upward pressure on inflation and interest rates, as is their failure to invest in skills development and the infrastructure we need to be competitive in the world.

Higher interest rates will be the direct result of policy failure from this Government; no long term investment in skills and an election campaign where they spent like drunken sailors to buy a fourth term.

With Costello’s eyes on the Lodge we can expect more dishonesty on interest rates and more of the same cavalier attitude to any impact on family budgets.


Contact Jim Chalmers 0417 141 676