PRICES EDGING UP AGAIN; CHINA WARNING
Inflation on the rise again
Annual inflation is creeping up again in Australia, with the monthly Consumer Price Index indicator rising to 3.6 per cent in the 12 months to April. Inflation fell steadily in the latter months of 2023, but has risen steadily since bottoming out at 3.4 per cent in February, according to the Australian Bureau of Statistics. Insurance and financial services (8.2 per cent rise) and rentals (up 7.5 per cent) contributed to the rising rate of annual inflation. Government-funded energy bill relief helped to restrain rising electricity prices to an annual rise of 4.2 per cent; without the relief, electricity prices would have risen 13.9 per cent over the 12-month period.
China must accept scrutiny on defence, says Marles
Defence Minister Richard Marles has taken direct aim at China for its “strategic partnership” with Russia during the Ukraine conflict, claiming it undermined adherence to the global rules-based order. Addressing the Shangri-La Dialogue in Singapore, the Deputy Prime Minister said China must accept the increased scrutiny on the way it used its strength and its choice of international partners. Mr Marles said confidence and trust in Chinese intent would be the single most important ingredient to the maintenance of the global rules-based order, and to a stable and prosperous Indo-Pacific region. Citing Chinese actions towards Taiwan and in the West Philippine Sea and East China Sea, the Minister said Australia must pay attention to China’s strategic behaviour and the signals it sent. Mr Marles said Australia was deepening its alliance with the US, and expanding its relationships with Japan, Korea, India, Indonesia, the Philippines, Vietnam and other partners in Southeast Asia. He also welcomed a greater European voice in the Indo-Pacific region.
Labor loses Victorian seat in electoral shakeup, gain for WA
Victoria will lose the former blue-ribbon federal Liberal seat of Higgins and Western Australia will gain an extra seat under latest redistribution proposals released by the Australian Electoral Commission. In 2022, Labor won the inner eastern Melbourne seat of Higgins, formerly held by Liberal Prime Ministers Harold Holt and John Gorton, and by Federal Treasurer Peter Costello. Western Australia will gain a 16th federal seat, to be known as Bullwinkel, (after the WW2 Australian nurse and heroine, Vivian Bullwinkel) and located on the urban-rural fringe east of Perth. New South Wales is also due to lose a federal seat, with the AEC due to hand down its proposed redistribution in coming weeks.
Taxation revenue jumps by 10.6 per cent
Australia’s three tiers of government collected almost $756 billion in taxation revenue in 2022-23, up by 10.6 per cent on the previous year. Figures from the ABS show that the level of taxation relative to the size of the economy has risen steadily in recent years, from 27.8 per cent of gross domestic product in 2019-20 to 29.5 per cent of GDP in 2022-23. The Federal Government’s tax take constituted $618 billion, or 81 per cent of total taxation revenue. Across states and the territories, the level of annual increase in state taxation varied widely, falling by 3.5 per cent in the Northern Territory, and rising by 1.8 per cent in New South Wales, 6.7 per cent in the Australian Capital Territory and by 6.4 per cent in Western Australia.
Tougher checks on sensitive foreign investment, says Treasury chief
Federal Treasury Secretary Steven Kennedy said the Government’s approach to foreign investment would be more streamlined and more transparent in a bid to support priorities such as Future Made in Australia. In an address to the Economics Legislation Committee, Dr Kennedy said the approach to foreign investment needed to strike the right balance between economic and national security, amid strong competition for global capital. National security threats were increasing due to intensifying geopolitical competition. The Treasury Head said greater resources and scrutiny would be dedicated to foreign investment proposals in critical and sensitive areas of the economy, but consultation and assessment processes would be streamlined to enable faster decisions on lower-risk proposals.
Electricity emissions down but transport, farm emissions up
Climate Change and Energy Minister Chris Bowen has welcomed figures that report a 0.5 per cent drop in Australia’s annual total emissions in 2023. Mr Bowen said the latest update of the National Greenhouse Gas Inventory recorded a 2.4 million tonne fall in carbon dioxide equivalent emissions, which he said were chiefly driven by the renewables component of electricity generation. He said that while the electricity sector accounted for a 4.4 million tonne fall in emissions, it was partially offset by a 3.4 million tonne rise in transport emissions and a 0.5 million tonne increase in agricultural emissions. Mr Bowen said Australia’s greenhouse gas emissions were now 29 per cent below June 2005 levels, the base year for the Paris Agreement target. Under the Paris Agreement, Australia has committed to reduce emissions by 43 per cent by 2030, under 2005 levels.