Finance Minister Katy Gallagher says Greens ‘out of control’ after forced rates cut demand
Finance Minister Katy Gallagher has called the Greens “out of control” after they demanded unprecendented action against the Reserve Bank.
The Greens have threatened that if the federal government did not force the RBA to cut interest rates, they would not support Labor’s major reforms to the central bank.
Senator Gallagher said on Monday “their ultimatum” was “crazy” and ruled it out.
Camera IconKaty Gallagher has called the Greens “out of control” after their latest move. NewsWire / Martin Ollman Credit: News Corp Australia
“Well, I just think the Greens are out of control at the moment, full of self importance and out seeking populist approach to everything,” Senator Gallagher told ABC radio.
“It’s crazy what they’re saying to us. So if that’s their ultimatum, and it’s a bit unseemly, Nick McKim going around issuing ultimatums, no, we won’t work with that, because that is crazy.
“It’s economically irresponsible, and we won’t do it.”
But Nick McKim, the Greens’ economy spokesman, has defended the Greens’ hostage-taking approach, telling the ABC: “I can tell Labor what is out of control, and that is the housing crisis in Australia.
“Renters and mortgage holders are getting smashed.
“Housing affordability, on the figures out this morning, has never been worse in Australia, and we are unambiguously using our political power in the parliament to fight to bring interest rates down mortgage holders get some much needed relief.”
Senator McKim dismissed the Reserve Bank’s independence, saying “the power exists in Australian law for the government of day to set interest rates.”
“If Jim Chalmers wants this bill passed, as he said he does, and if the governor of the Reserve Bank, Michele Bullock, wants
Camera IconRBA Governor Michele Bullock (pictured) is under pressure to cut rates. NewsWire / Max Mason-Hubers Credit: News Corp Australia
to see this bill passed, as she has said she does, they know what they’ve got to do.”
Pressure is mounting on the RBA to cut rates after the US just last week joined Europe and New Zealand in lowering interest rates.
Senator Gallagher said the government was still committed to the reforms and that it was working with the Coalition.
University of Queensland Professor John Quiggin says the RBA is the “odd player out” compared to other central banks around the world when it comes to cutting interest rates. The US Federal Reserve cut interest rates by 50 basis points this week. It signalled that more cuts are likely at its final two meetings of the year.
The Coalition earlier this month walked back its support for the government’s plan to create two RBA boards – one to manage interest rate decisions and one for governance.
Shadow treasurer Angus Taylor said he was concerned the move could undermine the RBA’s independence.
Treasurer Jim Chalmers has dismissed the concerns, saying the reforms had the support of the bank’s governor, Michele Bullock.
The Greens’ ultimatum is the latest hurdle cast before the government’s legislative agenda, with Labor struggling to get bills through a constipated senate.
Last week, the Greens dealt a major blow to the government’s plan to tackle soaring housing costs by refusing to support two key bills aimed at building more rentals and assisting first home buyers purchase properties.
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