{"id":948203,"date":"2026-11-01T01:26:15","date_gmt":"2026-11-01T01:26:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/948203\/"},"modified":"2026-11-01T01:26:15","modified_gmt":"2026-11-01T01:26:15","slug":"a-safe-bet-labor-is-in-for-a-rough-economic-ride-this-melbourne-cup-day","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/948203\/","title":{"rendered":"A safe bet Labor is in for a rough economic ride this Melbourne Cup Day"},"content":{"rendered":"

Forget the form guide. The closest thing to a sure bet this Melbourne Cup Day is another rate rise.\u00a0<\/p>\n

And unlike the punters at Flemington, millions of Australians won’t have a say in how much it costs them.<\/p>\n

The average household bears no responsibility for the wars, oil crisis and AI boom that are driving up inflation, but that doesn’t save them from the economic pain.<\/p>\n

It’s why Labor’s emphasis on these international factors is wearing thin with voters, who want workable solutions and help rather than explanations or excuses.<\/p>\n

As pressure builds on the Albanese government, the remarkable caucus discipline of the past four years is fraying by the day.<\/p>\n

No easy way out of inflation<\/a><\/p>\n

Another bad inflation result causes pain for households, business and the government. They also show that a tougher approach may well be needed to curb the problem.\u00a0<\/p>\n

The difficult economic outlook has been compounded by a succession of own goals, failures of process and poor consultation, which have sparked a litany of post-budget backdowns.<\/p>\n

The accumulation has taken a toll, with many Labor MPs feeling like they have been left to defend decisions they had little say in shaping.<\/p>\n

Internal discontent and anonymous griping are at a notably high watermark.<\/p>\n

There are apparently plenty of people in government able to diagnose the problems, but what’s lacking is articulation of a clear path forward.<\/p>\n

All eyes on MYEFO<\/p>\n

Markets are pricing a more than 80 per cent chance the Reserve Bank will lift the cash rate to 4.85 per cent on Tuesday, a level not seen since the global financial crisis in 2008.<\/p>\n

As households do what they must to absorb the cost, focus on the federal government’s role in the inflation fight will only sharpen.<\/p>\n

Gone are the days of energy rebates and slashing the fuel excise, now almost all of the political debate is about how to cut public spending to help the RBA.<\/p>\n

All this makes next month’s mid-year economic and fiscal outlook (MYEFO) an unusually important moment for the government.<\/p>\n

\"A<\/p>\n

The days of handing out relief to a public struggling with cost-of-living are gone.\u00a0 (AAP)<\/p>\n

Having already promised savings to help ease demand in the economy, Treasurer Jim Chalmers was this week asked if the December update would result in a “net” reduction in government spending.<\/p>\n

He pointed out that in this year’s budget and the last MYEFO, net policy decisions had made a “positive contribution over the four years” of the budget.<\/p>\n

That is true over the forwards, but when it comes to fighting inflation, it’s the shorter term that really matters. And for the current and last financial year, government decisions in those two updates added about $14 billion to the overall spend.<\/p>\n

There is no shortage of Labor MPs who believe this MYEFO must be different, with terms like “means testing” and “net savings” a constant refrain in private conversations.<\/p>\n

Albanese heads to CHOGM<\/p>\n

None of this is news to Chalmers, as evidenced by his own camp pointing out it is the prime minister who ultimately rules the all-powerful expenditure review committee, where such decisions are signed off.<\/p>\n

That sparked some ministers in Albanese’s corner to argue the prime minister had been prudent in reining in some of the treasurer’s budget ambitions.<\/p>\n

The apparent deterioration in the relationship between Albanese and Chalmers has started to concern some in Labor, who fear the more time spent apportioning blame for recent events, the less the government appears focused on solutions.<\/p>\n

Chalmers caused some raised eyebrows when he this week suggested that while he “genuinely” took responsibility for some of the “hard stuff” in the budget causing political pain for Labor, it was also up to “other ministers and the prime minister how they describe their part in that”.<\/p>\n

\"A<\/p>\n

Jim Chalmers will be on his own to face an almost definite rate rise.\u00a0 (ABC News: Matt Roberts)<\/p>\n

Whether or not the treasurer is unfairly copping the bulk of the criticism, as one Labor MP noted, it “matters little” to voters who “will be just as happy to blame us all”.<\/p>\n

That is likely precisely what will happen on Tuesday when the Reserve Bank is expected to lift the cash rate.<\/p>\n

Chalmers will be left to manage the immediate fallout at home, while Albanese lands in the Caribbean for the Commonwealth Heads of Government Meeting (CHOGM).<\/p>\n

Those optics are not lost on the Coalition, which already started using Question Time last week to needle the prime minister about his impending absence.<\/p>\n

The decision to attend CHOGM has puzzled many of Albanese’s colleagues.<\/p>\n

As the prime minister himself revealed, the request came directly from King Charles, and while there Albanese will hold talks with UK leader Andy Burnham and Canada’s Mark Carney.<\/p>\n

The hope is voters will understand the need for Australia to engage on the world stage, particularly when so many of the forces affecting its economy originate overseas.<\/p>\n

But with the demands of summit season dragging Albanese abroad for almost four of the next seven weeks, expect his detractors to give the “Airbus Albo” moniker a workout.<\/p>\n

The prime minister has ridden out plenty of political turbulence before, but this time the economic headwinds are being compounded by growing frustration within his own ranks.<\/p>\n

Whatever happens at the Melbourne Cup, at least someone will finish the day a winner. The same can’t be said for either Albanese or Chalmers.<\/p>\n

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