Australia news LIVE: Peter Dutton says migration surge will fuel Australia’s housing crunch in budget reply; Stage three tax cuts will still leave middle income wages worse off

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Key posts

  • Migration surge will inflame Australia’s housing crunch: Dutton
  • RBA modelling reveals huge cost of lifting rates more aggressively
  • US ambassador accuses South Africa of providing arms to Russia
  • This morning’s headlines at a glance

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Migration surge will inflame Australia’s housing crunch: Dutton

Opposition Leader Peter Dutton has escalated a federal budget fight over migration by accusing Labor of making life harder for working people on low incomes with plans for 1.5 million migrants who will put pressure on housing, transport and wages.

Dutton seized on the migration forecasts as a test for Prime Minister Anthony Albanese after the federal government chose to review major road and rail projects rather than reveal a funding package for new construction in this week’s federal budget.

Opposition Leader Peter Dutton during his budget-in-reply speech.Credit: Alex Ellinghausen

But the prime minister dismissed the attack as a hypocrisy because Dutton had spoken in favour of migration last year when Labor lifted the permanent intake from 160,000 to 195,000 a year in a compromise with employers and unions.

More on this issue here.

RBA modelling reveals huge cost of lifting rates more aggressively

The Reserve Bank was told that aggressively lifting official interest rates by a full percentage point would drive inflation down to its target band by late next year, but at a cost of almost 200,000 people out of work.

In documents released under freedom of information laws on Thursday, internal research by bank economists – dated February 2023 when the cash rate was 3.35 per cent – showed a string of larger interest rate rises until May would pull inflation to within 2 and 3 per cent at least six months earlier than the bank is currently forecasting.

The Reserve Bank of Australia modelling shows what would happen if it aggressively lifted rates. Credit: Dominic Lorrimer

The documents also reveal that a separate analysis, completed in September last year, showed the bank’s much-claimed “narrow path” could be a coin toss between Australia sinking into recession or avoiding a downturn.

Keep reading here. 

US ambassador accuses South Africa of providing arms to Russia

The US ambassador to South Africa accused the country of providing weapons and ammunition to Russia for its war in Ukraine via a cargo ship linked to a sanctioned company that docked secretly at a naval base near the city of Cape Town in December.

South African President Cyril Ramaphosa said an investigation into the visit by a Russian vessel named Lady R to his nation’s main naval base was already underway behind the scenes with the help of US intelligence services before Ambassador Reuben Brigety went public at a news conference in the South African capital, Pretoria, that the cargo was weapons and ammunition.

People pass by an apartment building damaged by a drone that was shot down, during a Russian overnight strike in Kyiv. Credit: AP

Brigety said the US was certain that military equipment was loaded onto the Lady R at the Simon’s Town naval base between Dec. 6 and Dec. 8 and then transported to Russia. He said it brought into question South Africa’s supposed neutral stance on the war in Ukraine and its calls for the conflict to end.

“The arming of the Russians is extremely serious, and we do not consider this issue to be resolved,” Brigety said in comments reported by multiple South African news outlets.

If South Africa is found to be giving Russia military aid, it threatens to fracture the relationship between the United States and a key partner in Africa. Despite South Africa’s neutral stance on the war in Ukraine, the Biden Administration was hoping it could still be a key buffer against growing Russian and Chinese influence on the continent.

While Ramaphosa’s office said in a statement later Thursday that there was currently “no evidence” to support allegations that arms were loaded onto the Lady R, The Associated Press established that the vessel is tied to a company that was sanctioned last year by the U.S. for being involved in transporting military equipment for the Russian government.

The news of Brigety’s comments broke while Ramaphosa was in Cape Town answering questions on other matters in Parliament. When the leader of the political opposition, John Steenhuisen, asked about the weapons and ammunition, the president replied that “the matter is being looked into, and in time we will be able to speak about it.”

AP

This morning’s headlines at a glance

Good morning, and thank you for your company this Friday.

I’m Caroline Schelle, and I’ll be anchoring our live coverage for the first half of the day.

It’s May 12 and here’s what you need to know before we get started:

  • Opposition Leader Peter Dutton used his budget reply speech to claim the government on making cost of living pressures worse, and that a migration surge will inflame Australia’s housing crunch.
  • Independent analysis found stage three tax relief will leave middle income wage earners up to $172 worse off in 2025.
  • Government modelling of plans to extend the length of people’s NDIS support packages and increase oversight of how money is allocated and spent could save more than $15 billion.
  • The Reserve Bank of Australia has been told if it aggressively lifts interest rates by a full percentage point it would drive inflation down to its target but at a cost of almost 200,000 people out of work.
  • The fallout from consulting giant PwC’s tax scandal is growing with Greens and integrity experts urging the Commonwealth anti-corruption commission to investigate.
  • Meanwhile in NSW, the premier implored the opposition to support new legislation to clean up government grants in the state after a series of scandals.
  • In Victorian political news, the state Liberal Party will hold its second vote on whether to expel controversial Liberal MP Moira Deeming.
  • WA Premier Mark McGowan delivered the state’s sixth budget surplus in a row.
  • Overseas, a man in Canada shot and killed one police officer and wounded two others in what authorities described as an ambush in a rural part of the country’s most populous province.

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