MATTERS OF PUBLIC IMPORTANCE

Ms CLUTTERHAM (Sturt) (15:44): Every government faces the same complex challenge. Resources are finite, and need and expectations are not. Australians rightly expect governments to help keep inflation under control, to pull what levers they can.

Australians also expect governments to fund healthcare, strengthen Medicare, provide dignified and quality care to older Australians, support housing, provide a social safety net, invest in defence and respond when communities need support. The real challenge of governing is balancing those priorities responsibly. The Australian people understand this.

This understanding is reflected in the many conversations I have with people in my electorate of Sturt every week. People understand the need to provide for others less fortunate than they are. They understand that decisions need to be made now which may not appear to have a short-term gain but which are creating the building blocks for long-term prosperity and long-term social cohesion and harmony.

They understand there are trade-offs, forgone benefits and compromises that the government has to work through every day. That means recognising that every decision has an opportunity cost. Every dollar spent is a dollar that cannot be spent elsewhere.

Equally, every dollar not invested can carry consequences for Australians who rely on essential services or consequences for the long-term strength of our economy. That is why the Final Budget Outcome this year was so important. It demonstrated that the 2025-2026 position was $6 billion better than forecast.

It showed that over four years the budget position has improved by around $230 billion. Gross debt is almost $200 billion lower than projected when this government came to office. Australia has one of the lowest levels of gross debt across advanced economies.

This is the result of a government making deliberate choices, finding savings, reprioritising spending and returning the majority of revenue upgrades to the bottom line. When this government came to office, inflation was above six per cent and rising. While inflation has moderated significantly, there is no question that it remains higher than what we would like.

Inflation is not solely an Australian phenomenon. Global economies are facing supply chain disruptions, energy shocks and geopolitical instability. Conflict in the Middle East has put upward pressure on global fuel prices, affecting inflation outcomes across advanced economies.

Now when constituents talk to me about the cost of groceries or fuel or insurance, they understand that global events are playing a role. This does not absolve governments of responsibility, and, in this respect, this government has repeatedly been very clear that it has a role to play in the fight against inflation. We've been honest about the combination of factors that drive inflation, and we've been clear about what tools we have available to address it.

What this all means is that governments must act responsibly in the areas they can control, which includes the budget. This is what this government has done and will continue to do. At the same time, fiscal responsibility cannot mean abandoning the services Australians depend on.

Those who call loudly for governments to cut spending never outline how they will address the risks of this. The first risk, significantly reducing government support, risks stagflation and a recession and would certainly make responding to other recessionary forces more difficult. The government needs to be careful to manage this significant risk with all of the attendant economic and social costs that would bring with it.

The second risk is that the policymaking process has limited bandwidth. Policymakers cannot address all issues at once, and good policy making is about prioritisation, not just offering up a wish list of things to cut risk. The third risk is that building future initiatives will get overlooked.

Cutting spending on programs supporting health, R&D, education, the social safety net and the care economy means the economic circumstances of Australians who are already at a higher risk of falling behind will worsen. This is not fair, and this lack of investment will leave future generations with a higher debt burden. There is an opportunity cost to inaction.

Good government requires difficult trade-offs and balancing budget discipline with a community's legitimate expectation that government will deliver essential services and invest in the nation's future. Responsible government is what we are practising. That is what we are doing.