Senior Labor sources have told News24 host Sharri Markson that Prime Minister Anthony Albanese had stopped the Treasurer from making additional spending cuts in the latest budget.
Markson told viewers on Thursday that Jim Chalmers wanted to rein in government spending but Mr Albanese blocked him, with one Labor source saying the party’s higher ups are not blaming the Treasurer for the economy.
“There’s a fair bit of finger-pointing at Jim about the messaging and the communication about the Budget, the housing market and anxiety around the economy,” a senior Labor source said.
“There’s not a serious voice in Caucus blaming Jim for the economy.
“The frustration is he is the Treasurer, the messaging and communication about the economy and why it’s not in the position we would want it to be.”
It comes as the latest News24.com.au / YouGov poll saw Labor sink to just 25 per cent of the primary vote, one point lower than its previous result.
It marks Labor’s lowest ever primary vote across every federal election since 1901 and was driven by a collapse in support among working class voters.
The Labor source told Markson there has been a degree of surprise at how openly Mr Albanese is criticising his Treasurer, which has led business leaders to believe he had “thrown Jim under the bus”.
“I know he’s blaming Chalmers and he’s saying Chalmers wanted to do even more in the budget and I blocked him,” the source said.
“Business people have said Albo has thrown Jim under the bus.”
Asked for comment by Markson, a spokeswoman said the claims were “nonsense.”
Mr Albanese has faced calls to either step down or dump Treasurer Chalmers to stem the loss of votes, as the party loses ground to One Nation.
Labor sources previously told News24.com.au that federal backbenchers feared losing their electorates in the next election, due to the government’s inability to handle the cost of living crisis.
On Thursday, Markson revealed multiple Labor sources said that Mr Albanese would not dump Mr Chalmers as it would be a “very silly” political move.
“It would be an admission of economic failure,” the source said.
“It would be politically very silly to do.”
In the NSW Right faction of Labor, there is a growing concern the Albanese government’s abysmal popularity could sink NSW Premier Chris Minns.
Mr Minns is a member of Labor’s Right faction and has himself described One Nation as a “genuine threat” to the party ahead of the March 2027 election.
Mr Minns last week publicly urged governments to rein in spending as inflation remained elevated and the Reserve Bank lifted interest rates.
The NSW Premier has also recently pressed the Albanese government on migration, reminding the Prime Minister that population settings remain a federal responsibility.