Anthony Albanese mulling over further cost-of-living relief but denies it would be a cash splash

Australians struggling with the cost of living have been offered a glimmer of hope from the Prime Minister.

Anthony Albanese has left the door open to providing further cost of living relief for struggling Australians but cautioned against expectations of a looming “cash splash”.

The Prime Minister confirmed the government planned to bank the most of the savings from the inflated budget surplus and said the support measures already in place would help ease the burden on those doing it tough.

“On Saturday … we saw cheaper childcare come in. We saw paid parental leave be extended. We saw a tripling of the Medicare bulk billing rate so that 11 million Australians can see a doctor for free,” he told the ABC.

“We saw the funding for Medicare urgent care clinics so that more people can get access to a doctor. We saw energy price relief, a $3 billion plan between the Commonwealth and state and territory governments to take that pressure off energy price increases as well.

“We saw all of those measures come in just over a week ago. But we’ll continue to examine what we can do.”

But Mr Albanese stressed the need for the government to work “hand-in-hand” with the Reserve Bank.

Mr Albanese left the door open to further cost of living relief. Picture: NCA NewsWire / Martin Ollman

“If the government just splashed money around, that would put upward pressure when it comes to inflation, which would work counter to what the Reserve Bank is doing on monetary policy.”

Monthly figures released by the Finance Department last week showed the budget surplus had swelled to $19bn in May off the back off a tight jobs market boosting tax revenue.

That figure far exceeded the forecasted $4.2bn which was unveiled by Treasurer Jim Chalmers just two months ago.

But the opposition has claimed the government is not doing enough to trim back spending to address the inflationary pressures being passed onto households struggling under the weight of rate rises and price hikes.

On Tuesday, the RBA left the cash rate on hold at 4.1 per cent as it considers whether the most aggressive tightening cycle in recent history has done enough to tame inflation.

The RBA left the cash rate on hold on Tuesday. Picture: NCA NewsWire / Nicholas Eagar

Governor Philip Lowe said further increases could be required in the near future to bring inflation, now at 5.6 per cent in the year to May, back to its 2 to 3 per cent target.

Finance Minister Katy Gallagher again shot down fears Australia was heading towards a likely recession as the impact of the rate rises is felt by the economy.

“That's not the Treasury forecast, and I note in the decision of the bank yesterday, they do have a line in there that says the board is still expecting the economy to grow as inflation returns to the two to three per cent range,” she said.

“We accept, you know, people are doing tough out there. We accept that, you know, growth is slowing, economic growth is slowing, that is what was expected essentially as we try to deal with this inflation challenge.”

Originally published as Anthony Albanese mulling over further cost-of-living relief but denies it would be a cash splash