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Prime Minister and Treasurer blame previous government for interest rate rise.

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Tuesday 5 February 2008

Prime Minister and Treasurer blame previous government for interest rate rise


TONY EASTLEY: Australians with home loans and debts could be facing another interest rate rise as of today. If the Reserve Bank hikes the price of money it will be the sixth consecutive interest rate rise in two years. It will take interest rates to an 11 year high. 


The Prime Minister Kevin Rudd has no doubt about who's to blame. 


KEVIN RUDD: My job is to run a very tight fiscal policy given the inflation legacy left to us by our predecessors. Our job and our government's side is to act on fiscal policy and our predecessors let the reins far too loose on that one.  


TONY EASTLEY: Kevin Rudd on the 7.30 Report last night. 


His Treasurer, Wayne Swan, goes further, blaming the Howard government's spending for today's inflation worries that are likely to prompt the Reserve Bank to hike rates. 


WAYNE SWAN: Well, what I'm saying is that the Howard government let the inflation genie out of the bottle. It's been on the march for a long period of time, particularly over the past two years, so it's taken some time to develop and it will take some time to deal with. 


The previous government was spending like a drunken sailor. That has an impact on inflationary expectations in the economy. 


TONY EASTLEY: The Federal Treasurer Wayne Swan on AM last week.