Treasurer Jim Chalmers is counting on the business sector to rescue Australia from its worst economic collapse since the 1990s recession, but has not ruled out further cost-of-living relief measures. Data released yesterday by the Australian Bureau of Statistics showed living standards are going backwards, with household spending falling sharply. Gross domestic product growth unexpectedly fell to an annualized 0.8% in September, from 1% in June, as the economy grew by just 0.3% in the previous quarter.
Consumer spending in Australia has fallen sharply in recent months. (Edwina Pickles/SMH) It shows Australia’s annual economic growth is the slowest outside the pandemic since the 1990 recession, with GDP per capita falling for the seventh consecutive quarter. The small expansion in the economy has been supported by government spending and immigration. The Albanese government’s energy rebates have not only brought relief to households but also helped keep overall inflation low. Chalmers said without public sector spending the economy would go backwards. Speaking yesterday, he said the federal government was looking to the private sector to kick-start the economy. Chalmers is preparing a mid-year financial update due in the coming weeks, as well as a pre-election budget due in March.Today he refused to rule out a new round of cost-of-living relief measures. “We’re always looking for responsible ways to help people wherever we can.” “We’ve got a very tight budget and we want to make sure we’re part of the solution and not part of the inflation problem.” But in the long term the government will rely on the business sector to pull Australia out of the downturn. “We recognise that as growth recovers, the best kind of growth is growth led by the private sector,” Chalmers said yesterday. Shadow Treasurer Angus Taylor said yesterday’s data showed the government had failed in its management of the economy. He warned that reliance on public spending and immigration could stoke inflation.