QUESTIONS WITHOUT NOTICE
Dr CHALMERS (Rankin—Treasurer) (14:59): I thank the member for Werriwa for her question and for the great work that she does in her local community. From an economic point of view, the end of the war in the Middle East can't come soon enough. We've seen in the last day or so that the oil price is now, again, $107 per barrel; that's 50 per cent higher since the conflict started.
What that means is that the war on the other side of the world is weighing on growth, and it's pushing up inflation right around the world. This is the point that the Reserve Bank's assistant governor, Sarah Hunter, made yesterday when she described the global environment as more inflationary and said the risk to inflation from the Middle East conflict has 'tracked up recently'.
The longer the war drags on, the more concerned markets become about the impacts of inflation. It pushes up expectations for global interest rates, which then pushes up bond yields as well. We saw the European Central Bank raise rates last week, and the market is now pricing in an interest rate hike in every single major advanced economy.
Overnight, the US 10-year yield crossed five per cent for the first time since 2023, and that means higher borrowing costs as well. We're not immune to these challenges. Our 10-year yield is up around 75 basis points since the conflict started, whereas in the US it's up about 100 basis points.
That's why, at a time of heightened global economic uncertainty, responsible economic management is more important now than ever before. It's why it's so important that we have lower gross debt to GDP than every major advanced economy. Our gross debt as a share of our economy is much less than half of the US, less than half of Canada and the UK.
It's also less than a quarter of gross debt to GDP in Japan. Because of this government's responsible approach to the budget, the bottom line is more than a quarter of a trillion dollars better than what we inherited from those opposite, and gross debt is around $200 billion lower. Our responsible approach to managing the budget stands in stark contrast to those opposite.
Most of the $1 trillion of debt in the budget—in fact, almost two-thirds of it—was racked up by the Liberal Party, when they doubled the debt even before COVID. They now have made more than half a trillion dollars worth of commitments since the election, with no explanation as to how they would pay for them—just over the four-year forward estimates, more than $110 billion in commitments.
Mr Tim Wilson: That's just a lie. Dr CHALMERS: We know that the war in Iran is the key driver of the uptick in inflation around the world, but by their own— The SPEAKER: Order! We're going to get the member for Goldstein—don't look surprised—to withdraw.
Mr Tim Wilson: To assist the House, I'll withdraw. Mr Burke: Mr Speaker, 'to assist the House' is viewed as a qualified apology, which is done on occasions when you have not ruled that something is unparliamentary. When something is unparliamentary, a withdrawal should simply be made without any qualifiers whatsoever.
The SPEAKER: We'll do it the right way. It was good enough for the Leader of the Opposition yesterday to follow my lead. It'll be good enough for the member for Goldstein to simply get up and withdraw.
Mr Tim Wilson: I'll withdraw. Dr CHALMERS: It's the closest he gets to the microphone during question time! By their own logic, their unfunded commitments will push inflation up, deficits up— (Time expired)