It's a quarter to two here on five double A and we are keeping you across the score down at Karen Rolton Oval for the Sheffield Shield Final between South Australia and Queensland. And Queensland have lost yet another wicket not even halfway through day one and they're eight for eighty five. So South Australia doing well so far. Let's hope they can continue with this momentum. As I said, we'll keep bringing you updates throughout the afternoon and Rowe and Timmy G will be broadcasting from the Oval the Savo, so they'll have everything for you in detail after four And speaking of Rowe and Timmy G. On Friday, their showdown fish Off is happening. We'll have one boat captained by Rowe and another one by Timmy G. It'll be crows v Port with bragging rights on the line. So make sure you tune in this Friday from four pm to see who's taking on that inaugural trophy. It's all thanks to Pepper's Cleaning Products and Alpha Industries celebrate forty years delivering custom made outdoor living and storage solutions out for industries dot com dot au. But now we're talking about the federal budget and getting some thoughts from a couple of you on the text line zero double four to eight zero eight thirteen ninety five. In regards to that idea from Theofikari from the Australian Association of Convenience Stores to freeze or reduce the tobacco exercise, it's more popular than I thought it would be. I didn't think that we thought of smokers in our community as the ones who need a bit of a break. But Russell agrees. He says drop prices all great to drop prices on legal cigarettes. It might fix the underground sale of cigi's and improve the government returns. But what about the non smoker who doesn't want secondhand smoke? YEP, I agree with you on that, Russell. The last thing I want to see is more people smoking in the streets of Adelaide. It's already too many. I was walking down Pirie Street yesterday and there was a lady walking past me with a cigarette and I just thought, no, I don't I don't want that in my face. Please keep it away from me. Andrew though says, I agree with the gap between vapes and legal cigarettes being way too big. I reckon, freeze the excise and reduce it later. There you go. There's one way of thinking about it. Eight double two to three double double oh is the number to call. Let's talk about the rest of the budget though. AMP chief economist is doctor Shane Olive's a long time budget watcher, and he joins you, now, good afternoon, Shane, thanks for your time.

It's a quarter to two here on five double A and we are keeping you across the score down at Karen Rolton Oval for the Sheffield Shield Final between South Australia and Queensland. And Queensland have lost yet another wicket not even halfway through day one and they're eight for eighty five. So South Australia doing well so far. Let's hope they can continue with this momentum. As I said, we'll keep bringing you updates throughout the afternoon and Rowe and Timmy G will be broadcasting from the Oval the Savo, so they'll have everything for you in detail after four And speaking of Rowe and Timmy G. On Friday, their showdown fish Off is happening. We'll have one boat captained by Rowe and another one by Timmy G. It'll be crows v Port with bragging rights on the line. So make sure you tune in this Friday from four pm to see who's taking on that inaugural trophy. It's all thanks to Pepper's Cleaning Products and Alpha Industries celebrate forty years delivering custom made outdoor living and storage solutions out for industries dot com dot au. But now we're talking about the federal budget and getting some thoughts from a couple of you on the text line zero double four to eight zero eight thirteen ninety five. In regards to that idea from Theofikari from the Australian Association of Convenience Stores to freeze or reduce the tobacco exercise, it's more popular than I thought it would be. I didn't think that we thought of smokers in our community as the ones who need a bit of a break. But Russell agrees. He says drop prices all great to drop prices on legal cigarettes. It might fix the underground sale of cigi's and improve the government returns. But what about the non smoker who doesn't want secondhand smoke? YEP, I agree with you on that, Russell. The last thing I want to see is more people smoking in the streets of Adelaide. It's already too many. I was walking down Pirie Street yesterday and there was a lady walking past me with a cigarette and I just thought, no, I don't I don't want that in my face. Please keep it away from me. Andrew though says, I agree with the gap between vapes and legal cigarettes being way too big. I reckon, freeze the excise and reduce it later. There you go. There's one way of thinking about it. Eight double two to three double double oh is the number to call. Let's talk about the rest of the budget though. AMP chief economist is doctor Shane Olive's a long time budget watcher, and he joins you, now, good afternoon, Shane, thanks for your time.

My pleasure, thanks for having me now.

My pleasure, thanks for having me now.

I don't think we were expecting any big surprises. And the main surprise, in my opinion, it certainly wasn't big five dollars a week tax cut from July next year. Then what is it? Ten dollars a week from twenty twenty seven. Do you think it will actually filter through to struggling Aussies or is it going to get eaten up by bracket creep.

I don't think we were expecting any big surprises. And the main surprise, in my opinion, it certainly wasn't big five dollars a week tax cut from July next year. Then what is it? Ten dollars a week from twenty twenty seven. Do you think it will actually filter through to struggling Aussies or is it going to get eaten up by bracket creep.

Well, to be honest with you, it's better than nothing. But when you put it in the context of just five dollars a week or ten dollars a week in a couple of years time, it's hardly anything in the great scheme of things. Amanda Vanstoner, I think was in the Howard government many years ago, referred to the tax cutters of that magnitude is a sandwich and a milkshake tax cut, but of course it wouldn't these days. In many cases, it wouldn't be enough to buy that much of a milkshake toge It's not going to make a huge difference to anyone. It's a little bit of help. I guess it is good to see that the government is giving back what they call bracket creep, which is where people just jump into higher tax brackets over time. But in the great scheme of things, it's pretty modest. I don't think it's going to make a huge impact, huge difference to the economy, and many people won't even notice it.

Well, to be honest with you, it's better than nothing. But when you put it in the context of just five dollars a week or ten dollars a week in a couple of years time, it's hardly anything in the great scheme of things. Amanda Vanstoner, I think was in the Howard government many years ago, referred to the tax cutters of that magnitude is a sandwich and a milkshake tax cut, but of course it wouldn't these days. In many cases, it wouldn't be enough to buy that much of a milkshake toge It's not going to make a huge difference to anyone. It's a little bit of help. I guess it is good to see that the government is giving back what they call bracket creep, which is where people just jump into higher tax brackets over time. But in the great scheme of things, it's pretty modest. I don't think it's going to make a huge impact, huge difference to the economy, and many people won't even notice it.

Bracket creep is on a lot of people's minds at the moment, As you know, cost of living goes up and inflation is occurring for all of us. Is this a way of the government saying, well, we're trying to address that by reducing your tax while not actually making any substantial change to the tax brackets that will have any long term impacts on how much money we take home and therefore on the budget and how much money they bring in in taxes.

Bracket creep is on a lot of people's minds at the moment, As you know, cost of living goes up and inflation is occurring for all of us. Is this a way of the government saying, well, we're trying to address that by reducing your tax while not actually making any substantial change to the tax brackets that will have any long term impacts on how much money we take home and therefore on the budget and how much money they bring in in taxes.

It's a bit of a slide of hand. I think government loves bracket creep. It means that the tax take basically goes up over time simply because people jump into higher tax brackets brackets that their wages go up. What should happen is that the tax brackets should be indexed to inflation or wages, and so you don't jump into these higher brackets unless you've got bigger than normal wage rises. But they don't want to do that because if they do that, then they won't get the extra revenue. They can't say, well, in ten years time, we're going to balance the budget. The only reason it's been budget it's been balanced in the budget numbers that came out last night is because our bracket reep over the next decade. Like to sort of leave it in there to say, well, eventually we'll get back to balance. But they also like to leave it in there because when elections are around the corner, they can announce tax cuts and say, gee, aren't we fantastic. We'll give you a tax cut, and that's what they've done here. So it would make sense to index the brackets, raise the brackets every year in line with the rate of inflation, just like we raise pensions and other things. But I can't see the government, any government and any political persuasion doing it in Australia out of interest. There's lots of countries and comparable countries. America indexes their tax brackets every year to inflation, so they don't have this issue of bracket creep. But I think politicians are addicted to it and love the idea of saying oe, aren't we good We're giving you these tax cuts. So I don't see it being changed.

It's a bit of a slide of hand. I think government loves bracket creep. It means that the tax take basically goes up over time simply because people jump into higher tax brackets brackets that their wages go up. What should happen is that the tax brackets should be indexed to inflation or wages, and so you don't jump into these higher brackets unless you've got bigger than normal wage rises. But they don't want to do that because if they do that, then they won't get the extra revenue. They can't say, well, in ten years time, we're going to balance the budget. The only reason it's been budget it's been balanced in the budget numbers that came out last night is because our bracket reep over the next decade. Like to sort of leave it in there to say, well, eventually we'll get back to balance. But they also like to leave it in there because when elections are around the corner, they can announce tax cuts and say, gee, aren't we fantastic. We'll give you a tax cut, and that's what they've done here. So it would make sense to index the brackets, raise the brackets every year in line with the rate of inflation, just like we raise pensions and other things. But I can't see the government, any government and any political persuasion doing it in Australia out of interest. There's lots of countries and comparable countries. America indexes their tax brackets every year to inflation, so they don't have this issue of bracket creep. But I think politicians are addicted to it and love the idea of saying oe, aren't we good We're giving you these tax cuts. So I don't see it being changed.

Yeah, yep, absolutely, And unfortunately, like you said, it doesn't seem like either of the major parties have any appetite to change it, especially not for this election or any time soon.

Yeah, yep, absolutely, And unfortunately, like you said, it doesn't seem like either of the major parties have any appetite to change it, especially not for this election or any time soon.

Now.

Now.

Shane budgets. There are always a time where we get a good look at the forward look at the economy. Are there any surprises in the forecasts for inflation and employment? Is there any spanner in the works for potential rate cups this year?

Shane budgets. There are always a time where we get a good look at the forward look at the economy. Are there any surprises in the forecasts for inflation and employment? Is there any spanner in the works for potential rate cups this year?

Well, probably not. I thought the forecast the government had were pretty bland. They see a pickup in economic growth to in a fewyears time two point seven five percent, unemployment staying around or a little bit above current level saur point two five percent, and inflation basically staying around two and a half percent. A bit of a blip up next year when obviously they're assuming the electricity rebates come to an end, but only to three percent, then going back to two and a half percent. So it all fairly blands. I guess some of ours economists, how much stingy bunch, you know, we might sort of football. Well, you know, we've got all this extra spending going on over the next four years. They're pumping in another thirty five billion dollars into the economy in extra spending. You know, maybe that's going to to heat things. And we've still have a big government recently locking in record levels of government spending. Those sorts of things, you could argue, well, may mean that interest rates stay higher than would otherwise have been the case. And I do think that if we hadn't had all this spending by governments, by stay of federal probably would have been seeing interest rates a lot lower than they are now. So that's arguably an ongoing weakness. And all of this government likes that politicians like to look like they're doing things, spending money, making promises to do this, and that you get a bit bit of political cute offs for that, but a cost is it has made the reserve banks job harder because the Reserve Bank has been trying to get us to cut down our spending to ease the pressure on inflation, and of course we have been ordinary restraints have been the governments have been spending year after year far more quickly than would normally be the case, and that's been making resis Bank's job harder. This budget doesn't really change that.

Well, probably not. I thought the forecast the government had were pretty bland. They see a pickup in economic growth to in a fewyears time two point seven five percent, unemployment staying around or a little bit above current level saur point two five percent, and inflation basically staying around two and a half percent. A bit of a blip up next year when obviously they're assuming the electricity rebates come to an end, but only to three percent, then going back to two and a half percent. So it all fairly blands. I guess some of ours economists, how much stingy bunch, you know, we might sort of football. Well, you know, we've got all this extra spending going on over the next four years. They're pumping in another thirty five billion dollars into the economy in extra spending. You know, maybe that's going to to heat things. And we've still have a big government recently locking in record levels of government spending. Those sorts of things, you could argue, well, may mean that interest rates stay higher than would otherwise have been the case. And I do think that if we hadn't had all this spending by governments, by stay of federal probably would have been seeing interest rates a lot lower than they are now. So that's arguably an ongoing weakness. And all of this government likes that politicians like to look like they're doing things, spending money, making promises to do this, and that you get a bit bit of political cute offs for that, but a cost is it has made the reserve banks job harder because the Reserve Bank has been trying to get us to cut down our spending to ease the pressure on inflation, and of course we have been ordinary restraints have been the governments have been spending year after year far more quickly than would normally be the case, and that's been making resis Bank's job harder. This budget doesn't really change that.

It's a cruel, cruel cycle. So what do you what do you think in terms of interest rates? Is I think last time we spoke you were you were forecasting another one, maybe two rate cuts this year. Are you still.

It's a cruel, cruel cycle. So what do you what do you think in terms of interest rates? Is I think last time we spoke you were you were forecasting another one, maybe two rate cuts this year. Are you still.

We're on the optimistic side? And there were some good numbers out today It probably lost in the budget analysis. But the inflation numbers are for February two point four percent over the last year, and the so called trimm don mean form. As an economist, I don't like talking about the trim mans. That sounds statistical nonsense, but basically it troops out the energy of rebates and things due to floods and bad weather and stuff. But it looks at the underlying tendency infell to two point seven percent. So both of the measures of inflation are in the target range, and you could argue they're around the two and a half percent midpoint of the target range, which is good news. And we think the Reserve Bank probably won't cut next week. They have a meeting on April Fool's Day next week. I think Donald Trump was going to make big announcements on tariff's on April Fall's date when he realized it was Fapral Fall's Day and made it April the second, when we'll hear about his tariffs. But I don't think the RBA is going to move next week because we're probably going to get an election announcement in the next few days. I reckon, yeah, and they're probably thinking, oh, let's wait for the Dingy Die CPI, the quarterly one that comes out in a month's time, and then wait to May and maybe make a decision to cut in May, which I think they will do. But I don't think they'll cuts next week. And we do see another cut in August. There are two more cuts this year, so a bit more relief coming through. But I reckon, if if you hadn't had the list government spending, mortgage holders would be felling a lot more relief by now, and we'd probably see bigger infestrate cuts than we're currently forecasting.

We're on the optimistic side? And there were some good numbers out today It probably lost in the budget analysis. But the inflation numbers are for February two point four percent over the last year, and the so called trimm don mean form. As an economist, I don't like talking about the trim mans. That sounds statistical nonsense, but basically it troops out the energy of rebates and things due to floods and bad weather and stuff. But it looks at the underlying tendency infell to two point seven percent. So both of the measures of inflation are in the target range, and you could argue they're around the two and a half percent midpoint of the target range, which is good news. And we think the Reserve Bank probably won't cut next week. They have a meeting on April Fool's Day next week. I think Donald Trump was going to make big announcements on tariff's on April Fall's date when he realized it was Fapral Fall's Day and made it April the second, when we'll hear about his tariffs. But I don't think the RBA is going to move next week because we're probably going to get an election announcement in the next few days. I reckon, yeah, and they're probably thinking, oh, let's wait for the Dingy Die CPI, the quarterly one that comes out in a month's time, and then wait to May and maybe make a decision to cut in May, which I think they will do. But I don't think they'll cuts next week. And we do see another cut in August. There are two more cuts this year, so a bit more relief coming through. But I reckon, if if you hadn't had the list government spending, mortgage holders would be felling a lot more relief by now, and we'd probably see bigger infestrate cuts than we're currently forecasting.

Yeah, okay, so probably not next week, but maybe in May. That could be a little bit controversial as well, depending on the exact date of the election when we get one, because I know the RBA doesn't usually like to be seen to be getting involved in an election campaign, but we could be seeing a great decision right in the crux of.

Yeah, okay, so probably not next week, but maybe in May. That could be a little bit controversial as well, depending on the exact date of the election when we get one, because I know the RBA doesn't usually like to be seen to be getting involved in an election campaign, but we could be seeing a great decision right in the crux of.

It, well, we could. It's funny this year. I don't know why it happened, but the RBO used to have it February, May, August and November and the first Tuesday of every month. But the main meeting this year is not till I think maybe the nineteenth. Oh it's a little bit after an election seventeenth, it could be nineteenth or twentieth or something like that. So they'll probably, as far as I understand, they'll miss it. Oh all right, because I expect the election will need to be in the first or second Saturday in May, which case the RBO meeting will come after that, Whereas if they were to ease next week, it could well be in the election campaign if they do that, But I don't think they will lose next week.

It, well, we could. It's funny this year. I don't know why it happened, but the RBO used to have it February, May, August and November and the first Tuesday of every month. But the main meeting this year is not till I think maybe the nineteenth. Oh it's a little bit after an election seventeenth, it could be nineteenth or twentieth or something like that. So they'll probably, as far as I understand, they'll miss it. Oh all right, because I expect the election will need to be in the first or second Saturday in May, which case the RBO meeting will come after that, Whereas if they were to ease next week, it could well be in the election campaign if they do that, But I don't think they will lose next week.

Yeah, all right, well there go. Maybe they maybe they had a forward look at the calendar and thought, oh well.

Yeah, all right, well there go. Maybe they maybe they had a forward look at the calendar and thought, oh well.

I reckon, they might have you. I reckon because I reckon given all the flack that the previous guy got for hiking rates in the middle of election campaign, that they wanted to avoid it this time. One way to do that is just push forward, to push out the meeting beyond when the election might be. But of course the RBA will probably never tell you that was the reason they changed the day.

I reckon, they might have you. I reckon because I reckon given all the flack that the previous guy got for hiking rates in the middle of election campaign, that they wanted to avoid it this time. One way to do that is just push forward, to push out the meeting beyond when the election might be. But of course the RBA will probably never tell you that was the reason they changed the day.

No, And you know what, I don't think many people would be too critical of them for that. If it means that they will at least be making a decision based on the economics and not based on the politics, I'm okay with that.

No, And you know what, I don't think many people would be too critical of them for that. If it means that they will at least be making a decision based on the economics and not based on the politics, I'm okay with that.

Yeah, that's fair enough, That is fair enough. I mean, what do they want to get political? You know, to be a small target and stay away, keep out of it. Yes, they got enough flat a few years ago and then governor ended up going and blah blah blah or government. I have a different spin on it, but nevertheless, they did get a lot of flak. I'm almost certainly they wanted to avoid having to do anything an election campaign this time around.

Yeah, that's fair enough, That is fair enough. I mean, what do they want to get political? You know, to be a small target and stay away, keep out of it. Yes, they got enough flat a few years ago and then governor ended up going and blah blah blah or government. I have a different spin on it, but nevertheless, they did get a lot of flak. I'm almost certainly they wanted to avoid having to do anything an election campaign this time around.

Yeah, and fair enough, too, all right, Shane, Well, it's always great to get your thoughts. Really appreciate your time. I know it's a busy couple of days for economists like yourself, so thank you.

Yeah, and fair enough, too, all right, Shane, Well, it's always great to get your thoughts. Really appreciate your time. I know it's a busy couple of days for economists like yourself, so thank you.

My pleasure, thanks for having me.

My pleasure, thanks for having me.

Thank you doctor Shane Oliver there, chief economist with AMP and as I say, longtime budget watcher. Quick update from Karen Rolton Oval Queensland now sit at nine for ninety one after thirty three overs. We'll continue to give you score updates from the Sheffield Shield Final throughout the afternoon, but now it's time for the two o'clock news and after that Real Estate Radio with Bronte Manual, so if you've got a question for him. Eight double two to three, double O, double OW five Double A Afternoons with Stacy Lee

Thank you doctor Shane Oliver there, chief economist with AMP and as I say, longtime budget watcher. Quick update from Karen Rolton Oval Queensland now sit at nine for ninety one after thirty three overs. We'll continue to give you score updates from the Sheffield Shield Final throughout the afternoon, but now it's time for the two o'clock news and after that Real Estate Radio with Bronte Manual, so if you've got a question for him. Eight double two to three, double O, double OW five Double A Afternoons with Stacy Lee