The commencement of winter has brought with it blue skies and sunshine albeit lower temps also, which will take a little getting used to!
With school holidays starting towards the end of June here’s hoping the skies remain blue for all the holidaymakers keen to enjoy our tourism offerings after a very damp summertime. Since I last communicated to you, we’ve had a ‘changing of the guard’ in Canberra with the Albanese Government taking control of the Federal purse strings.
Immediately the new Treasurer has started blaming the previous government for financial aspects appearing on the horizon for Australia and has already issued dire warnings about the economic road ahead. We are all aware that inflation has soared and that upward pressures on the inflation rate are coming thick and fast, such as fuel prices, floods affecting food supply, the war in Ukraine and the spiralling cost of building supplies. There is no doubt that a rise in interest rates will follow and to what extent that rate reaches will determine the economic reality check on the booming housing market.
As someone who paid the 20% interest rate on business loans in the late ‘early nineties’ with the Paul Keating “recession we had to have”, I think it is time to take a very conservative approach to fiscal measures in the months and years ahead. A 5% wage rise which the new government is asking the Fair Work commission for is another inflationary measure that will only add to more wage-driven demands from other sectors, and this will add to a spiralling rise in interest rates which will eat into your business bottom line.
On budgetary matters, the Queensland State budget will be brought down on June 14th, and we are bracing ourselves for a “Ned Kelly” raid on fees and charges payable to the Government in Labor’s attempt to pay the rising interest bill on their $130,000,000,000 (yes, that is the amount of zero’s!) Queenslander debt that you and I will have to pay back at some stage in the future. Mining royalties and massive stamp duty income increases will have softened the blow of a budget deficit to some extent, but it is still a crazy amount of debt hanging over our heads particularly when these profligate spenders have wasted $3.5billion on infrastructure cost blow-outs.
That is $26,000 of debt on the head of every man, woman and child in Queensland. Throw in Queensland’s share of nearly a trillion dollars in Federal debt and people should be very concerned about the fiscal road ahead.
As we head into the second half of 2022, winter is halfway behind us and mid-year school holidays have brought many visitors to the coast, a welcome boost for our local restaurateurs and retailers. Unfortunately, the year-long rain drenching of the Gold Coast continues ruining holiday-makers’ plans. So we do hope to see a return to sunshine soon!
Cost of Living
With both interest rates and inflation on the rise, households will be cautious about where they are spending their hard-earned dollars whilst balancing their budget around soaring energy and fuel costs.
The RBA cash rate has been hiked by 0.5%, from 0.85% to 1.35% and this is the second 50-basis point increase in as many months. This rings alarm bells for many homeowners and investors and puts the construction industry on notice of hard times ahead. Coupled with the soaring cost of building supplies, the business community is facing extreme economic uncertainty in these unparalleled times.
And that brings me to this year’s Palaszczuk State Labor budget which is nothing but bad news for the business community. Three new State taxes affecting employment, small business and the gambling industry and more debt for Queenslanders with the Governments’ dodgy accounting practices failing to hide their addiction to putting more zeros onto the astronomical debt levels of Queenslanders with no payback plan in sight.
The new mining tax will deliver more unemployment in the “FIFO” mining industry and the new payroll tax hikes will strike a $400 million blow to the bottom profit line of small businesses, the largest employer in Queensland. Their answer to unemployment is to hire more public servants which have seen the public service grow under Labor’s watch from 190,000 to 250,000 in just seven years. 60,000 new public servants is an annual recurrent cost to the budget of $ 6 billion dollars and yet our hospital system is still a shambles despite all of these new union membership public service employees.
Despite the Premier’s cries of a record spend on public health, which it is every year anyway, there will not be one new hospital bed from this year’s budget until 2028 – 6 years away!
Our Leader, David Crisafulli is doing a grand job, of taking the Government on in health issues, integrity and corruption issues as recent polling are reflecting. The real elephant in the room is the upcoming economic issues that the Palaszczuk Government has no idea how to deal with.
Soaring electricity and gas prices are already upon us and our political catch cry of the moment being climate change and moving immediately to renewables in energy supply are front and centre for the blame in this area. Despite large vested corporate interest in the move to renewables, coal-fired power stations are a necessity in keeping power prices low. Unfortunately, this will be just another factor adding to the inflationary gallop and it will be incredible viewing as to what the Federal Labor Government and the Queensland State Labor Government come up with as viable treatments to this economy’s crippling fiscal threat.
Should you have any State issues you would like to discuss please feel free to contact my office on:
Tel: 5600 0100 / Email: Mermaid.Beach@parliament.qld.gov.au
You can also find me on Facebook at www.facebook.com/RayStevensMP.
Ray Stevens MP
State Member for Mermaid Beach