Politics Now Economic Report Card | Insiders On Background
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Nov 28, 2025 In this engaging discussion, Aruna Sathmapali, CEO of the Grattan Institute, and economist Chris Richardson delve into the critical priorities for the government's new year agenda. They explore the implications of rising inflation and argue against the effectiveness of household energy rebates. Both experts stress the need for strategic spending cuts, emphasizing waste reduction and targeted reforms ahead of the May budget. They also highlight the urgency of boosting productivity to support essential services and climate goals.
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Modest Growth Can Reignite Inflation
- Inflation has edged higher again driven by a modest economic pickup and weak productivity.
- Chris Richardson warns a small speed-up in a clapped-out engine quickly lifts inflation and risks higher rates for mortgage holders.
Don't Make Rebates Permanent
- Avoid extending blunt household energy rebates as permanent policy because they don't target the worst-off or change behaviour.
- Aruna Sathmapali recommends pushing retailers to move customers to better, cheaper plans as a more durable solution.
Subsidies Don't Cure Inflation
- Subsidies like energy rebates add dollars without increasing supply so they don't fix underlying inflation.
- Chris Richardson says such measures look helpful politically but can worsen budget pressures and inflation dynamics.