Treasurer defends 'sound' national economy
Australia's economic fundamentals are sound, despite the impact of global uncertainty and the drought, Treasurer Josh Frydenberg says.
The economy expanded by 0.4 per cent in the three months to March, on seasonally adjusted basis, and by 1.8 per cent in the previous 12 months.
Government spending made a major contribution to the growth, with more cash flowing into disability, health and aged care services.
But household spending was weak, with people buying fewer non essential goods, including furniture and meals at restaurants.
The weak figures come after the economy grew by just 0.2 per cent in the December quarter, and by 2.3 per cent throughout 2018.
"The fundamentals of the Australian economy remain sound," Mr Frydenberg told reporters in Canberra on Wednesday.
He said the proportion of working age Australians on welfare was at a 30-year low, a triple-A credit rating remained in place and the nation was in its 28th consecutive year of economic growth.
Mr Frydenberg said "real international and domestic challenges" would be met by the government rolling out personal income tax cuts, the Reserve Bank's interest rate cut, $100 billion in infrastructure spending, extra spending on skills and training and the expansion of the instant asset write-off.
Meanwhile, the treasurer said Westpac and ANZ owed their customers an explanation after keeping some of the rate cut for themselves, despite their own funding costs recently falling from high levels.
"I think their customers have been let down by this decision," he said.
"We know that people can move between banks and seek a better deal as well, and I'd encourage them to always look for the best possible deal for themselves and for their families and their businesses."
Mr Frydenberg says he can't force the banks' hand but has reminded them of the recent damning financial services royal commission.
The cash rate was on Tuesday dropped by 25 basis points to 1.25 per cent, marking the first cut in nearly three years, with more expected to follow.
The Commonwealth Bank and NAB have said they would pass on the full cut to those who hold mortgages with them.
Shadow treasurer Jim Chalmers says Westpac and ANZ's choice not to do the same is "disgraceful", as the nation grapples with a slowing economy.
"We can't afford to have banks pocket some of this interest rate relief," he told ABC News on Wednesday.
Mr Chalmers has also reminded customers they can express their distaste by going elsewhere if they like.
"They should certainly shop around to see whether they can get a better deal somewhere else."
