NSW Premier Chris Minns has taken an indirect swipe at Anthony Albanese and Jim Chalmers over their approach to government spending, saying every level of government must play a role in easing inflationary pressure.
The comments came after the Reserve Bank unanimously raised the cash rate by 25 basis points to 4.6 per cent on Tuesday, taking borrowing costs to their highest level since 2011.
Australian Bureau of Statistics figures released on Wednesday showed the Consumer Price Index climbed 4 per cent in the 12 months to August 2026. That marked an increase from the 3.5 per cent recorded in the year to July.
After the inflation data was released, Minns highlighted his government’s record on spending restraint and referred to Reserve Bank warnings about the potential inflationary impact of public expenditure, appearing to contrast NSW’s approach with Canberra’s fiscal policy.
‘I think every government has a responsibility to do what it can to take demand out of the economy,’ he said on Wednesday.
‘We have heard the advice from the RBA over the last two years that we need to be careful with public funds.
‘As a result, over the last four years, we’ve had the lowest increase in spending growth of any jurisdiction in the country, Labor or Liberal, any state, any territory, any government.
‘And the reason for that is we’ve had to make difficult decisions along the way.’
Chris Minns (pictured) has stressed his NSW government’s fiscal record after the latest interest rate increase
The Premier said governments had to acknowledge the limits of public finances, arguing that fiscal discipline had helped bolster confidence in NSW’s financial position.
‘We recognise there’s a finite amount of public funds to use and just recently we’ve had our credit rating reaffirmed by the ratings agencies,’ Minns said.
‘In fact, there’s been an upgrade to it which has been the result of a lot of hard work.’
Despite the pointed remarks, Minns stopped short of openly attacking the federal government, while maintaining that controlling the growth of public spending was necessary.
‘I’m not going to make a long commentary about other governments. It’s up to them and their decisions, obviously,’ he said.
‘But we want to make it clear that we’ve been careful with public money, particularly the growth in public money, and that will continue if we’re re-elected next March.’
Reserve Bank Governor Michelle Bullock likewise avoided directly blaming the government, although she pointed to Australia’s weak productivity performance as a significant concern.
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‘The bottom line is that productivity is doing nothing. And I know we talk about productivity a lot, but it’s so important if we want the economy to be able to grow and create jobs,’ she said on Tuesday.
One NSW Labor MP said they wished Albanese could ‘stay away’ from the 2027 election
Minns’s comments come as tensions appear to be growing between NSW Labor and the federal government, with the Premier seeking to reinforce his own political identity.
The NSW Premier has taken different positions from his federal colleagues on several policy matters in recent months.
He has supported One Nation leader Pauline Hanson and the federal Coalition’s push for a reduction in tobacco excise, and publicly clashed with Chalmers over GST arrangements.
Some NSW Labor MPs would like Minns to go even further.
The Daily Mail understands several state MPs believe the premier should put as much distance as possible between himself and the Prime Minister ahead of the 2027 election.
They have suggested he adopt a similar approach to former Premier Gladys Berejiklian’s decision to keep Scott Morrison at arm’s length before the Coalition’s victory in 2019.
‘I wish [Albanese] could stay away,’ one NSW Labor MP told the Daily Mail last week.
The private frustration reflects growing concern within sections of the NSW Labor caucus that the Prime Minister could drag down the party’s vote, especially in regional areas where cost-of-living pressures remain acute and support for major parties has softened.
Those worries have been sharpened by the rise of Pauline Hanson and One Nation, with the party believing it can make significant gains across regional and outer-suburban NSW at the next state election.
When it comes to the interest rate increase, Chalmers and Albanese have rejected claims that government spending contributed to the hike.
The Prime Minister said his government would consider new cost-of-living relief and spending cuts in the mid-year economic update due in December.
Asked whether he agreed with claims inflation was largely homegrown or with Chalmers’ argument that the US war with Iran was a key driver of the rate hike, Albanese said he agreed with both.
‘They are not saying contradictory things at all,’ he said.
‘The Treasurer has been very consistent, speaking about the inflationary pressures which are there in the economy. [But] the war in the Middle East has had an impact and people can’t just dismiss that.’