Ahead of an inflation figure due next week that financial markets expect to be high Mr Abbott said since Labor took office electricity prices had climbed 35 per cent, gas prices 24 per cent, water prices 29 per cent, bread 11 per cent and rents 15 per cent.
Asked what he would do to reign them in, he pointed to labor's failed FuelWatch and GroceryWatch schemes and to $47 billion of budget savings promised by the opposition in its response to the May budget.
Asked earlier on Sky News whether he could guarantee his policies would put downward pressure on interest rates, he replied: "Absolutely, I do."
The pledge is similar to but weaker than Prime Minister John Howard's 2004 guarantee that "interest rates are always going to be lower under a coalition government."
The words came back to haunt Mr Howard in the 2007 election with Labor able to quote them back as interest rates climbed five times and then once more in the campaign itself days before the poll.
Not all of the price comparisons used by Mr Abbott reflect favourably on the Coalition. While electricity, gas and water have increased in price far more under Labor than during the same period at the end of the Coalition's term, the price of bread - highlighted by Mr Abbott - has in fact increased more slowly. It climbed 13 per cent under the Coalition.
And overall price growth has been near-identical under each... In the nine quarters for which there is data under Labor the consumer price index climbed 6.8 per cent. In the Coalition's final nine quarters it grew 6.9 per cent.
Mr Abbott blamed Labor's debt and "failures to keep government spending under control" for high inflation and high interest rates.
"We are determined to make sure government exercises the same kind of restraint over its spending which businesses and households have long understood. Households and businesses have had to tighten their belts over the last few years and it’s high time that government tightened its belt," he said.
"There is no doubt that when you've got a government out there in the market borrowing $100 million a day, every day - I mean the debt will be $3.5 billion or thereabouts higher at the end of this campaign than at the start - when you've got a government that's on a spending spree, when it's spending out of control, yes that's a $100 million every day that would be available to other borrowers."
"Of course it puts upward pressure on interest rates," he said.
Treasurer Wayne Swan said rates were in fact lower under Labor than under the Coalition and that Labor's infrastructure spending should take pressure "off inflation, and therefore off rates".
Mortgage rates at present average 7.4 per cent with the possibility of an increase to 7.65 per cent two weeks into the campaign.
The Coalition left office with mortgage rates at 8.55 per cent.
Mr Swan acknowledged the cost of living was "a real factor for many people in our community".
"That's why we were so intent on delivering the three rounds of tax cuts that we promised," he said. "The last round only delivered a couple of weeks ago."
Published in today's SMH and Age
TRANSCRIPT OF THE HON. TONY ABBOTT MHR
JOINT DOORSTOP INTERVIEW WITH FIONA SCOTT,
LIBERAL CANDIDATE FOR LINDSAY
Subjects: The Lindsay Electorate; the cost of living; the Coalition’s direct action plan to reduce carbon emissions; the ‘moving forward’ slogan.
Ok, well look it’s good to be here in Western Sydney, in the electorate of Lindsay. It’s good to be in the home of Christian and Emily Knight and I want to thank them for making us so welcome. It’s good to be with Fiona Scott, the Liberal candidate for Lindsay, and also with Senator Marise Payne who is the Shadow Minister for COAG and also our Senator for Western Sydney.
Just chatting to the Knights and the Stratfords, it’s very interesting that the two issues that are worrying them are basically rising interest rates and the rising cost of living. Every day this Government is borrowing $100 million a day and that is putting needless upward pressure on interest rates and that is putting unnecessary pressure on the family budgets of people like the Knights and the Stratfords.
Then, of course, there’s the broken promises. We heard a lot from the Labor Party before the 2007 Election about restraining the cost of living. They talked about FuelWatch and they talked about GroceryWatch – two schemes that never got off the ground. Meanwhile, the cost of living just goes up and up. Electricity prices up 35 per cent, gas prices are up 24 per cent, water prices are up 29 per cent, the price of bread up nearly 11 per cent and the price of rent is up 15 per cent. These are Labor Government failures. They are broken promises. Failures to keep government spending under control that is causing harm to everyday Australian families.
The other subject that I’d just like to mention is today the Prime Minister made a $200 million plus local infrastructure announcement. Well, Julia Gillard has a record with infrastructure, it’s called the Building the Education Revolution programme - $16 billion, much of which has been wasted because the Prime Minister wanted to give the money to the State education bureaucrats to waste rather than give it to the parents and principals to invest wisely in their children’s future. So how can you trust Julia Gillard to spend this latest $200 million well, when she’s made such a mess of the $16 billion that she spent earlier. How can you trust them to deliver on their 2010 promises, when they completely reneged on their 2007 promises? So, I might ask Fiona, who will be a strong voice for the people of Lindsay and for Western Sydney, just to say a few words.
Thank you Tony. Thank you. It’s been a great honour to be the candidate for the Liberal Party out here in Lindsay and I’ve been hearing so much, so much from the people out here that they are so concerned about the seven interest rate increase in a row. The cost of living here is going through the roof. We need to ensure that we’re out here working hard for the people of Lindsay to bring these pressures back under control. It’s really important.
Ok, all right, now are there any questions that people have got?
What’s your answer on the cost of living? It’s all very nice on a beautiful day to call us out here, but you haven’t got a policy to announce it seems?
What I do have is $47 billion worth of reductions in government spending, and that will help to take the pressure off interest rates. If government gets its spending under control, that will help households with their spending because the interest rate pressure will be reduced.
Where would your axe fall first Mr Abbott?
Well, I’ve published a list. Andrew Robb and Joe Hockey published a list the week after the Budget came out. One of the things that we’re determined to do is to make sure that government exercises the same kind of restraint over its spending which businesses and households have long understood. Households and businesses have had to tighten their belts over the last few years and it’s high time that government tightened its belt and that’s why it’s important that we do exercise restraint and that’s why we’ve identified $47 billion worth of reductions.
The cost of living Mr Abbott would inevitably rise as a result of the policy on climate change and carbon prices [inaudible]? What role will carbon prices have in an Abbott government and action on climate change?
Well, we do not believe in artificially imposing a carbon price on consumers. There will be no carbon price on consumers under a Coalition government, none whatsoever. Julia Gillard says she wants a carbon price, she supports a carbon price and she will bring in a carbon price and there is no way that this government should go right through to polling day without coming clean on exactly what its plans are to impose a carbon tax on everything and on everyone.
What if the world acts? What if there’s finally global agreement on such an [inaudible]? Will you follow them?
Well, Julia Gillard has said she will act in 2012, come what may.
What about if the world? Washington?
You are asking about a most unlikely hypothetical situation.
An Abbott government?
No, an international agreement binding on countries like India and China to deny themselves the means of increasing their standard of living.
Mr Abbott, on the 20th of May Joe Hockey said inevitably we’ll have a price on carbon, we’ll have to. Do you agree with that comment? It appears not.
I think it is very, very unlikely that India and China will deny themselves the means of improving their standard of living. In order to raise their standards of living, they are inevitably going to become much bigger users of energy over time and the idea that they are going to deny themselves the kind of standard of living that other countries enjoy, it’s just not very plausible and it’s not going to happen any time soon.
Last week the Climate Institute found that dithering and indecision and uncertainty on the ETS was in fact forcing the price of electricity up. What would you do to end the speculation to keep a lid on prices?
Well, I say that you can be certain under a Coalition government that there will be no carbon price imposed on consumers. That’s what I say. The other thing I say is that the Climate Institute actually said that the Coalition had a better policy on this because we actually have a policy to reduce emissions by five per cent by 2020 but we can do it without imposing higher costs on consumers. That’s the whole point of our policy, to improve the environment without destroying the economy, to improve the environment without slugging consumers with a great big new tax.
Do you still believe climate change is absolute crap?
The issue is not climate change, the issue is how you deal with it. We’ve got a policy to deal with climate change; the Government doesn’t.
The Prime Minister’s repetition of her slogan yesterday ‘moving forward’. What do you make of that slogan [inaudible]?
I think she’s really insulting the intelligence of voters to think that anyone is going to be persuaded by such a vacuous, empty phrase. It really is a completely contentless phrase and I think it exposes the bankruptcy of this government, the intellectual and policy bankruptcy of this Government and as I said, I think that by the time the public have heard this mindless mantra hundreds, if not thousands of times, they will have come to the conclusion that the best way for our country to move forward is for Labor to move out.
A question for Miss Scott. You spoke about how you’ve been talking to people around the electorate, but you were only preselected a matter of a couple of weeks ago. Why did it take so long for someone to be preselected in this seat and isn’t it as Barry O’Farrell said because the poll results are so low hardly anyone wanted to actually do it?
I am a local girl, I’ve lived in Penrith all my life. I’ve grown up in the area, I went to school in the area. I’m very in tune with the issues in this local area. People are very concerned about interest rates. We’ve had seven in a row.
Then why weren’t you preselected earlier?
It’s just part of the way things have been. We are a democratic Party. We democratically select our Leaders and we democratically select our candidates and it’s something that’s a really unique and fabulous trait of the Liberal Party. That takes time.
Thanks so much, thank you.
. Oh my. What party is that man standing for again?
. Lock August 3 in your diary, it's the most likely date for a pre-election hike
. Normal, but not for long - RBA