Ian Verrender

So I think it's better to look at the trend in government spending.

And the trend clearly has been coming down for the past 12 months.

And there have been, you know, clearly quite, you know,

concerned efforts to try and reduce government spending and to bring the budget back into some kind of surplus.

A lot of the surplus was blown out by the tax cuts, the stage three tax cuts.

We basically gave a lot of money back into the economy.

Government spending as a proportion of GDP is elevated.

There's no doubt about that, but it is being ratcheted back.

And it's that trend that you've really got to look at.

And I think you might find in the budget next week, that'll be a continuation.

Look, one of the difficulties with interest rate hikes particularly is that they target a very specific cohort.

So you target younger people, you target younger people who've bought homes, and you target younger people who bought homes in the last couple of years.

They've paid extraordinary prices for them.

They've had to borrow to the hilt.

And so any interest rate rise, the magnitude on your spending power is just incredible compared to years past when people didn't borrow as much and interest rates may have been higher so that when a rate hike came through, it wasn't proportionally as big an impact on your budget and on your spending power.

So it's a very small section of the population that gets hit there.

Is that fair?

Well, no, it's not.

And so should we be looking at other ways to try and rein in spending in the economy over a broader measure?

Yes, we should.