Former political heavyweights John Howard and Peter Costello have criticized the Albanian government’s financial mismanagement as the nation battles an ongoing cost of living crisis.
Speaking on the release of his government’s 2004 Cabinet papers, the former prime minister and federal treasurer gave the country’s current leaders – on both sides of the aisle – a grim report when it came to his handling of the national finances. .
Former Prime Minister John Howard expressed concern about the deteriorating fiscal situation, stating that the budget was “out of control”.
He warned that while there may not be an eminent risk to Australia’s credit rating, investors would be increasingly cautious.
“There may not be any immediate risk to your credit rating, but eventually there will be,” Mr Howard told The Australian newspaper.
Howard noted that the current government’s acceptance of a long-term debt future contrasts with previous Labor governments that prioritized balanced budgets.
Peter Costello, former treasurer in the Howard government, criticized the current treasury for not focusing on taxpayers.
“The Treasury can no longer be trusted to try to defend taxpayers,” Mr Costello said.
Howard (pictured left) and Costello (pictured right) gave a grim report on the current government’s handling of the nation’s finances.
Prime Minister Anthony Albanese came under harsh criticism
“They have joined this big government and this big spending. So I think even the Treasury as an institution has been degraded by this process.”
Howard criticized the economic management of Albanese and federal Treasurer Jim Chalmers.
‘The current government made a terrible economic and also political mistake by having delivered a couple of surpluses and then not saying: “We are going to do everything possible to keep it like this because we cannot afford (not to do so) at this time.” . difficult time for our economy,” said Mr Howard.
‘Maybe the government thinks the public doesn’t care. I think they are wrong.’
Costello agreed and blamed both sides for the dire state of Australia’s balance sheet.
He said the budget should have returned to surplus following the stimulus spending required during the 2008 financial crisis and the 2020-21 pandemic.
“What is happening in Australia is that per capita taxes are increasing and per capita spending is increasing even more rapidly,” Mr Costello said.
‘We are moving towards a country with higher taxes, higher spending and higher debt, and at the same time we are becoming a less productive country.
Treasurer Jim Chalmers has been urged to boost the nation’s productivity.
‘If productivity is ever to be regained, something must be done about the growing tax burden and the growing spending burden. There are many things that have contributed to the decline in productivity in Australia, but that is one of the most important.’
Costello said that while other nations had already reduced interest rates, Australia had yet to do the same.
He attributed this delay to a government characterized by high expenses and taxes, which has allowed the budget to once again be in deficit.
“The rest of the world is in an easing cycle: the British, the Europeans, the Americans, the New Zealanders,” he said.
“Australia hasn’t had any easing yet.”
Costello blamed public spending.
‘There is no doubt that public spending has kept interest rates higher for longer in Australia. “If they had adjusted spending in the last budget, or the previous one, we would now be in a cycle of flexibility,” he stated.
Howard and Costello also expressed concern about incoming US President Donald Trump’s controversial tariff plans.
“I am concerned, to put it mildly, very concerned, about Trump’s speech on tariffs,” Mr. Howard said.
‘Trade has lifted millions of people out of poverty. Unilaterally imposing tariffs of that order of magnitude on countries, whether they want to or not, is simply bad for global trade and is bad for the global economy.
Costello said he was not in favor of tariffs and they would not be good for Australia.
“Certainly, in my opinion, it is not in the spirit, if not the letter, of the free trade agreement, and we should do everything we can to try to convince Americans of that,” he said.