Federal Treasurer Jim Chalmers has warned Australians face a difficult 12 months, saying the government expects no quick relief from cost-of-living pressures and urging progressives not to look down on voters who have shifted towards One Nation.
Speaking ahead of Labor introducing its 30 per cent tax on trusts on Wednesday, a key part of the May budget, Chalmers said the government was braced for a difficult year, according to a copy of his speech.
“Nobody expects polls to change much any time soon – it would be more surprising if they did. Same goes for consumer confidence,” he said.
“They don’t expect things to get a lot better in the next 12 weeks but they do expect things to get a bit better over the next 12 months … We expect the tax reforms will be bedded down and legislated by then, too.”
The government’s economic agenda has been set back by four interest rate rises this year, persistent inflation, soaring petrol prices driven by the war in Iran and a collapse in consumer confidence, while Pauline Hanson’s support has surged.
Chalmers’ admission of a year of financial stress and continued global turmoil makes it more likely the Prime Minister will wait until early 2028 to call the election, rather than going to the polls in late 2027, when interest rates may have started to fall.
Albanese on Tuesday rejected suggestions of a midterm slump and sought to reassure worried Labor MPs in a caucus meeting. Earlier, NSW Right faction MPs vented in a Monday meeting about potential blowback from tradespeople over the trust changes, which follow backlash against a tax office credit card ban and amendments that watered down Labor’s budget tax reforms.
The Greens are threatening to launch an inquiry into the trust tax proposal, extending scrutiny of the government’s tax agenda. Uncertainty remains about how the measure will affect businesses and families restructuring.