Fed­eral frac­tures hit GDP

La­bor says di­vided Gov­ern­ment cur­tails growth

The Gold Coast Bulletin - - BUSINESS -

LA­BOR has come out swing­ing against a “triple whammy” of weaker wages, lower spend­ing and de­pleted house­hold sav­ings in the lat­est eco­nomic fig­ures.

Op­po­si­tion fi­nance spokesman Jim Chalmers said the na­tional ac­counts data ex­posed a Fed­eral Gov­ern­ment “too di­vided and too dis­tracted” to fo­cus on the things that mat­ter to the coun­try.

“The Mor­ri­son Gov­ern­ment has dropped the ball on the econ­omy,” Mr Chalmers (pic­tured) said yes­ter­day.

“That’s why we have slow­ing growth. We’ve got a slow­ing econ­omy, weak wages, weak sav­ings, weak spend­ing, and that’s be­cause we have a des­per­ately di­vided and dys­func­tional Mor­ri­son LNP Gov­ern­ment here in Can­berra.”

Of­fi­cial GDP fig­ures re­leased on Wed­nes­day re­vealed the econ­omy was slow­ing much more rapidly than ex­pected af­ter a growth spurt ear­lier this year.

Growth slowed to 0.3 per cent in the Septem­ber quar­ter, and to 2.8 per cent over the year to Septem­ber, the Aus­tralian Bu­reau of Statis­tics fig­ures showed.

That missed mar­ket ex­pec­ta­tions of 0.6 per cent growth for the quar­ter and 3.3 per cent growth for the year.

House­hold con­sump­tion and con­struc­tion were both much softer than ex­pected.

Home prices in Syd­ney have fallen 9.5 per cent since their peak last year. Mel­bourne is fol­low­ing suit, leav­ing con­sumers tight­en­ing belts as they feel less wealthy or are un­able to re­spond to ris­ing re­pay­ments by of­fload­ing prop­er­ties.

New home build­ing ac­tiv­ity de­clined 0.8 per cent in the quar­ter fol­low­ing gains of 3.5 per cent and 3 per cent in the pre­vi­ous pe­ri­ods.

House­hold fi­nal con­sump­tion ex­pen­di­ture in­creased just 0.3 per cent dur­ing the quar­ter.

But Trea­surer Josh Fry­den­berg said it was ridicu­lous to sug­gest the Aus­tralian econ­omy was not strong.

“At 2.8 per cent the Aus­tralian econ­omy is grow­ing faster than any G7 na­tion ex­cept the United States. We’re grow­ing faster than the OECD av­er­age,” he told ABC ra­dio.

“This is a very strong story. Only the La­bor Party are try­ing to poke holes in these na­tional ac­counts.”

Con­sumer spend­ing has fallen to a five-year low, pri­mar­ily due to a lack of wages growth.

The fig­ures seemed to sug­gest peo­ple were dip­ping fur­ther into their sav­ings just to stay afloat.

But the Trea­surer sees the trend in a dif­fer­ent way.

“Peo­ple feel con­fi­dent to spend,” Mr Fry­den­berg said.

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