Domestic cost pressures still there: oppn

Joe Hockey called on the government to reveal how the lack of a budget surplus impacts living costs. Source: AAP

SHADOW treasurer Joe Hockey says the government must reveal how its broken promise to return a budget surplus this financial year will impact on the cost of living of Australian households.

Mr Hockey said the latest consumer price index for the December quarter released on Wednesday showed the annual rate of inflation edged up to 2.2 per cent from two per cent previously, while domestic cost pressures remained of concern.

He said non-tradeables - domestically produced goods and services, such as meat, newspapers, takeaway food and new dwelling purchases - rose 0.7 per cent in the quarter and 3.9 per cent over the year.

He also noted that the cost of electricity over 2012 rose by 17.7 per cent, while other gas and household fuels increased by 17.3 per cent.

"These have been directly impacted by the carbon tax and the government could relieve cost pressures in this area by abolishing the carbon tax," Mr Hockey said in a statement on Wednesday.

Mr Hockey pointed to comments made by Treasurer Wayne Swan on budget night in 2011 that "meandering back to surplus" would compound pressures in the economy and push up the cost of living.

"The treasurer must come clean on how his broken promise to return the budget to surplus will impact on the cost of living of Australian households," he said.

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