Watt calls for Labor unity behind Chalmers as government seeks budget savings

Environment minister Murray Watt has called on Labor colleagues to stop undermining treasurer Jim Chalmers as the government searches for budget savings to ease inflation pressures. Popular clean energy subsidies are among the measures that could be curtailed, with ministers meeting again on Monday to consider spending reductions for next month’s mid-year budget update.

Asked about speculation of tensions between Chalmers and prime minister Anthony Albanese, and whether undermining and leaking against the treasurer should end, Watt replied: “Yes, I would.” He said government members had a responsibility to support one another and their policies during difficult times. Watt defended Chalmers’ performance, saying many of the factors affecting the economy were beyond any treasurer’s control, and acknowledged that criticism was coming from within Labor.

Two opinion polls released on Monday brought further difficulty for the government. The Resolve Political Monitor, published in the Age and Sydney Morning Herald, put Labor’s primary vote at 28%, compared with 34.6% at last year’s election. The Coalition fell one point to 22%, while One Nation remained at 25%. A Redbridge poll in the Financial Review recorded a two-point decline for Labor to 26%, a four-point rise for the Coalition to 25%, and a one-point fall for One Nation to 28%.

The cabinet expenditure review committee’s Monday meeting followed the Reserve Bank’s interest rate increase last week. Governor Michele Bullock said governments were responsible for managing their budgets independently of the bank, but identified both public and private spending as contributors to “excess demand” in the economy.

Watt also criticised the Coalition and minor parties over spending measures awaiting passage through parliament. These include savings from proposed changes to the private health insurance rebate for people over 65. He accused the Coalition of blocking $10 billion in government savings measures while simultaneously demanding further spending reductions.

Albanese has confirmed that public service spending will be examined ahead of the budget update, which is expected in mid-December. Departments and agencies were asked last year to find potential savings of up to 5% of their annual budgets as part of a push to reduce spending on lower priorities.

The government could also restrict its $7 billion home battery subsidy program and incentives for electric vehicle purchases. Announced in April 2025 with an initial expected cost of about $2 billion, the battery program has supported more than 600,000 installations and could face means testing. Electric vehicle subsidies have separately cost substantially more than anticipated. Meanwhile, Angus Taylor announced an opposition “red tape razor gang” on Monday aimed at reducing the burden that costly regulation places on businesses.