Leading economists from the Australian National University and the Economic Society of Australia have provided mixed assessments of Treasurer Jim Chalmers’ third budget. The economists were asked to grade the budget based on its ability to deliver on “inflation in the near term and then growth in the medium term.” It was found that most of the 49 economists surveyed failed to give the budget top marks.
Although the economists were reluctant to provide high grades, around one-third of them, 17 out of 49, gave the budget an A or a B. However, two economists chose not to offer a grade.
Peter Martin, the economics editor of The Conversation and a Visiting Fellow at the Crawford School of Public Policy at the Australian National University, highlighted that most economists did not give top marks to the budget, indicating a lack of unanimity among experts regarding its effectiveness in addressing inflation and stimulating growth.
Former federal treasurer Peter Costello expressed concerns about the budget, contending that it is inflationary due to the increase in spending, deficits, and debt. He emphasized that the budget, which included measures such as a $300 power bill rebate for all households and stage three tax cuts, could be stimulatory and lead to increased inflation. Moreover, he warned that this inflationary pressure could contribute to higher interest rates in the long term.
Treasurer Jim Chalmers’ budget has sparked a debate among economists, with varying opinions on its potential impacts on inflation and growth. While some economists remain optimistic, the lack of consensus among experts indicates the complexity of evaluating the budget’s effectiveness in achieving its economic objectives.
As the economic landscape continues to evolve, it is crucial to consider the diverse perspectives of leading economists in evaluating the implications of the budget. The discussions and analyses surrounding the budget highlight the importance of thorough assessments and ongoing monitoring of its impact on inflation and growth in the Australian economy.
