Federal fractures hit GDP

Labor says divided Government curtails growth

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 slow- ing 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 expec- tations 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.