The Costello way to the Wealth, everyone should have 5 jobs just to pay the bills. Treasurer Peter Costello denies he is trying to gloss over the rate of underlying inflation, saying "consumers' inflation" is the lowest in eight years.
He said the most important thing about inflation was that it averaged out at two to three per cent over the course of an economic cycle.
"... which is what it has done compared to the Labor Party of 5.2 per cent, when the Labor Party was in government," Mr Costello told ABC Radio today.
Mr Costello denied he tried to ignore the rate of underlying inflation when responding yesterday to the release of the latest consumer price index (CPI) data.
"For most people the important thing is whether they're facing price rises," he said.
"And the news that we got yesterday was that for consumers' inflation it is at 1.9 per cent, in fact it's the lowest in eight years."
Most economists are tipping an interest-rate hike next month after the data showed the underlying trend of inflation was nearing three per cent - at the top end of the Reserve Bank's target band.
A rate rise during an election campaign would deliver a potentially-fatal blow to the coalition, already reeling from the latest opinion polls showing Labor with an winning lead going into the November 24 poll.
Mr Costello said the government's objective was to get as many people in work, keep inflation low and to make sure the economy grew.
"We have inflation around two to three per cent on the lowest unemployment in 30 years," he said
"We couldn't have maintained anything like this inflation rate when we didn't have the important economic reforms that have been put in place.
"If you turn your back on those economic reforms with an unemployment rate that is at 30 years lows you will get ... a blow out in inflation."
Mr Costello said reversing industrial relations reform would set off wage inflation.
"As we had in the 70s, in the 80s and the 90s," he said.
"The last time the Labor government tried to cope with inflation ... they said we have to have a recession, that's what Paul Keating said.
"Industrial relations reform has given us the capacity to have much stronger employment and keep inflation in-between two and three per cent.
"If you turn you're back on that ... you are turning your back on Australia's future economic prospects."
ASX Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)