Rates blame game: Property Council aims up on government
The RBA decision to raise the home loan cash rates has hit mortgage holders hard at a time when cost pressures are already bearing down on families. While the Federal Government points the finger at the Mid-East conflict, back home the blame is directed at public policy.
ALTHOUGH it’s trying to blame the Middle East crisis, the Federal Government is copping heavy flak over the latest interest rate rise.
The RBA’s cash rate now sits at 4.6 per cent. Four hikes this year have added about $5,700 to the average annual mortgage repayment.
Among the Government’s critics is the Property Council of Australia, which cites federal spending.
“Talk about putting a nail in the market confidence tyre,” said CEO Mike Zorbas in his latest Executive Brief.
“High taxing governments are still spending too much. Excess government spending remains a significant factor in regressive interest rate rises.”
Zorbas quoted former Sunrise host David Koch’s September 22 open letter to RBA chief Michele Bullock, where he asked her to consider the “worryingly high” level of growth.
“So, who did the growing?” Koch asked. “Government, and not by a little.
“Commonwealth government spending has climbed to 26.8 per cent of GDP… the highest level outside the pandemic since 1986.
“Your rates instrument reaches roughly a third of households… those with a mortgage.”
Zorbas agreed with Koch’s call for regular RBA reporting of government spending beyond nominal GDP growth.
“Let’s put these voluptuous budgets on the treadmill of transparency,” Zorbas added.
” Profligate governments tax businesses and job creation harder too.
“Victoria is a warning to all other states on this. And the Federal government is headed that way.”
Victoria carries the highest debt among Australian states, with projections indicating it could reach almost $188 billion by 2027–2028.
“Witness the 2026 Federal budget tax hikes in the same cycle the government blew $16bn paying off HECS debt to stop a key demographic drifting to the Greens,” Zorbas added.
“Breathtaking. Undisciplined and self-interested political decisions like that mean the structural drivers for more tax hikes remain ahead of the next round of budgets.
“Unless we can get Federal and State governments to sign up to real plans for debt reduction,” Zorbas concluded.
