CABINET MULLS DEFENCE PLAN; RBA DIGS IN
Strategic defence report in Government hands
Six months after it was commissioned, the report of the Defence Strategic Review has been handed to the Albanese Government. Conducted by former Defence Minister Stephen Smith and former Chief of the Defence Force, Angus Houston, the review examined Australia’s defence force posture, force structure and capabilities. It engaged with more than 150 defence specialists and received more than 360 submissions. Defence Minister Richard Marles said the review considered strategic circumstances over the “next couple of decades”, and with Australia in a “strategically complex environment”, there would be an increasing call on the federal budget. Defence Department Secretary Greg Moriarty told a Senate Estimates hearing that the review would inform a new defence industry development strategy, designed to increase Australia’s industrial capacity in priority areas to deliver and support defence capabilities.
No let-up on monetary policy to peg inflation
Reserve Bank of Australia Governor Philip Lowe has foreshadowed further increases in the RBA cash rate target to fight inflation, warning of the longer-term effects of ingrained inflation on the economy. In an address to the House of Representatives Standing Committee on Economics, Dr Lowe said it would be dangerous to not contain and reverse the current period of high inflation, which registered 7.8 per cent in the December quarter. Dr Lowe said the bank expected a slowing of economic growth, with the central forecast of a 4.5 per cent unemployment rate by mid 2025. Last week, the Australian Bureau of Statistics reported that the nation’s unemployment rate in January rose to 3.7 per cent seasonally-adjusted, up from 3.5 per cent in December, and representing a potential cooling of inflationary pressures.
Key federal by-election in Victoria
Voters in the outer eastern Melbourne seat of Aston will return to the polls on April 1, following the resignation from Federal Parliament of former Coalition minister Alan Tudge. The Liberals have held the seat since 1990, but Labor candidate Mary Doyle slashed the Liberal two-party preferred margin by 7.3 per cent, to 2.8 per cent, at the 2022 Federal Election. Ms Doyle will run again for Labor; if she takes the seat off the yet-to-be-announced Liberal candidate, it will give the Albanese Government a three-seat majority in Parliament.
Home Affairs steps up fight against foreign interference
Home Affairs Minister Clare O’Neil has flagged an escalation of government action to identify and address areas of potential foreign interference in Australia. In an address at the Australian National University, Ms O’Neil said the Australian Security Intelligence Organisation (ASIO) and Home Affairs would work together to develop, for the first time, a program to identify individuals who might be targets of foreign interference, and help them to respond to it. The Minister praised the role of universities in tackling foreign interference, with a “dramatic increase” in their level of awareness since regular engagement with government agencies like ASIO. Ms O’Neil said foreign interference was commonly seen through foreign governments seeking to exert covert influence over migrant communities in Australia.
Chalmers moves to legislate superannuation objective
Treasurer Jim Chalmers is seeking to enshrine in legislation the objective of Australia’s superannuation system, releasing a Department of Treasury paper for public consultation on the issue. Dr Chalmers said there was no agreed objective of superannuation, legislated or elsewhere, to serve as a guide for policy makers, government, regulators, the industry and the wider community. He said a legislated objective would provide confidence to the superannuation sector in Australia. During the Covid-19 pandemic, more than $36 billion was paid out from superannuation funds under the early release scheme, according to the Australian Prudential Regulation Authority.
International visitors, students on the way back
International travel in and out of Australia is slowly recovering to pre-Covid peaks, with 1.2 million arrivals and 1.5 million departures recorded for December 2022. International students are also returning, but the intake of 35,000 students who came to Australia was still 7.4 per cent lower than in December 2019. Pre-Covid, Australia was recording more than two million of both monthly arrivals and departures. According to the Australian Bureau of Statistics, the leading source countries for visitors in December were New Zealand, the United Kingdom and the United States.