Voters mark down Labor on economic management after RBA rates call

Voters have marked down Labor over its handling of the nation’s finances after a political dispute about public spending and high inflation, shifting more support to the Coalition on a key test of budget management.

Labor has lifted its primary vote from 28 to 29 per cent over the past four weeks, in a small but important gain after months of decline. Core support for the Coalition has fallen from 38 to 37 per cent.

But the Coalition has cemented its lead over Labor on economic management and it has also extended its gains on budget policy when the Reserve Bank is blaming federal and state spending for putting pressure on inflation.

The exclusive findings show that Opposition Leader Peter Dutton (36 per cent) has maintained his small edge over Prime Minister Anthony Albanese (35 per cent) as the preferred national leader, compared with 35 and 34 per cent one month ago.

The Resolve Political Monitor, conducted for this masthead by Resolve Strategic, confirms the pressure on households from the cost of living: 56 per cent of voters expect the national outlook to get worse over the year ahead.

Voters strongly favoured Dutton and the Coalition when asked to choose the leader and party they believed would do a better job managing the nation’s finances: 41 per cent chose the opposition and only 23 per cent chose Albanese and Labor.

The Coalition has widened its lead on this measure from 15 to 18 percentage points over the past month.

When voters were asked to name the best party and leader to manage the economy, 40 per cent chose Dutton and the Coalition, while 23 per cent preferred Albanese and Labor.

Federal parliament resumes on Monday with the major parties at odds over government spending after the Reserve Bank last week revised its forecasts to say inflation would remain above its target range of 2 to 3 per cent until late next year.

The bank blamed domestic demand for the higher pressure on inflation and named government spending as a factor, putting Albanese and Treasurer Jim Chalmers on the defensive over their spending decisions.

“Public demand is forecast to be stronger than previously expected, reflecting recent public spending announcements by federal and state and territory governments,” the RBA said, while holding the cash rate at 4.35 per cent.

RBA governor Michele Bullock said the public demand was offsetting weakness in private demand and added: “It’s not necessarily putting upward pressure on inflation.”

At the same time, RBA assistant governor Sarah Hunter countered some of the government’s claims about the economy by saying demand was running “a little bit hot” and the Labor measures to subsidise energy bills would not help achieve a sustained return to the inflation target.

Shadow treasurer Angus Taylor called for spending cuts to ease the pressure on inflation, noting the opposition had already rejected $45 billion in Labor policies, but he did not nominate specific cuts that would quickly affect inflation.

Treasurer Jim Chalmers.Credit: Dan Peled

“We need to see improvements in labour productivity. We need to see public spending reflecting what is needed to get inflation down,” he said last week.

While the government has tried to avoid inflaming a dispute with the central bank, Chalmers rejected the RBA assertions about economic growth and said budget spending was not the primary factor in lifting prices.

“I think it’s hard to sustain an argument that the economy is running too hot or that people have too much spare cash, given all of the data and all of the feedback that we get, which shows that’s not the case,” Chalmers said.

Rather than halting spending in light of the central bank’s warning, the government chose to proceed with a $3.6 billion two-year wage subsidy for childcare workers last Wednesday, reflecting strong views within federal cabinet about the need to maintain economic growth and lift wages.

Resolve director Jim Reed said the childcare move appeared to have little impact on the polling because there were only two remarks about it from the 1607 people surveyed.

When voters were asked who was best to keep the cost of living low, 34 per cent named Dutton and the Coalition and 23 per cent named Albanese and Labor. The Coalition increased its lead on this score from seven to 11 percentage points over the past month.

“Most voters are tuning out of political events and policy debates right now, so we find little evidence that the recent reshuffle, tax cuts, childcare subsidy or spending debate have influenced vote choice,” Reed said.

“Labor have benefited from some clear air, but many voters are still sending a message that they expect more in tackling living costs, housing and crime.”

The Resolve Political Monitor surveyed 1607 people from Wednesday to Sunday, producing results with a margin of error of 2.4 per cent. This means all changes in primary vote were within the margin of error.

Because the poll asked voters to nominate their primary votes in the same way they would fill in their ballot papers for the lower house at an election, there was no “undecided” category in the results. Some other surveys remove the “uncommitted” cohort before finalising their results from the remaining respondents.

Cut through the noise of federal politics with news, views and expert analysis. Subscribers can sign up to our weekly Inside Politics newsletter.