Weekly Wrap Up – 12 December 2025
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While the Prime Minister was overseas attending the Commonwealth Heads of Government Meeting, the political debate at home remained firmly focused on cost of living. The Reserve Bank’s decision to raise the cash rate by 25 basis points to 4.85 per cent, its highest level since 2008, added to pressure on households and sharpened the focus on government spending ahead of December’s MYEFO
Politically, the rate rise leaves the Government with little room to move. Higher mortgage repayments increase pressure for further cost of living relief, but additional spending risks adding to inflation and undermining the case for lower rates. Anthony Albanese and Katy Gallagher have instead begun preparing the ground for spending restraint and difficult budget decisions, while Jim Chalmers must balance growing expenditure across health, NDIS, aged care and AUKUS against the need to demonstrate fiscal discipline.
The result is that MYEFO is shaping up as an important test of the Government’s economic narrative. It will need to show voters it understands the immediate pressure on household budgets while making the case that spending restraint is necessary to bring inflation and interest rates down.
Top Talking Points
Prime Ministerial Travel: The Prime Minister attended the 2026 Commonwealth Heads of Government Meeting in Antigua and Barbuda, discussing climate change, trade, ocean conservation and artificial intelligence. The summit also supported Australia’s campaign for a UN Security Council seat in 2029-30.
Reserve Bank of Australia: Following an increase in Australia’s annual inflation rate from 4.0 per cent to 4.3 per cent in September, the RBA Monetary Policy Board raised the official cash rate from 4.60 to 4.85 per cent.
EU Free Trade Deal: Don Farrell urged the Coalition to support the Australia-EU free trade agreement. The agreement has become a point of contention, with some Liberal senators reportedly considering crossing the floor.
2026 McKinnon Index: The 2026 McKinnon Index found trust in federal politicians has fallen sharply from 36 per cent last year, with only 30.5 per cent now expressing confidence in them.
Polling: Newspoll shows Labor’s primary vote holding steady at 27 per cent, with One Nation leading on 28 per cent ahead of the Coalition and the Greens at 21 and 13 per cent. The poll also found support for Anthony Albanese continuing to decline, while Angus Taylor and Pauline Hanson improved their standing with voters.
Making headlines this week
Upcoming MYEFO
Murray Watt – Packaging and Recycling Update
Things to watch
9 November, the ABS will release Building Approvals data.
9 November, the AFR will host the Infrastructure Summit 2026 in Sydney.
9 November and 10 November: The Senate Environment and Communications Legislation Committee will hold public hearings into the Online Safety Amendment (Digital Duty of Care) Bill 2026.
10 November, Michael Crosby will address the National Press Club, discussing the CFMEU.
11 November, the ABS will release Lending Indicators data.
11 November, Denita Wawn will address the National Press Club, discussing corruption in the building and construction sector.
12 November, the AFR will host the AI Forum 2026 in Sydney.
12 November, the ABS will release Water Account data.
Treasury and Finance
The Federal Government released its new Statement of Expectations for the Australian Financial Security Authority. The Statement calls on AFSA to reduce administrative barriers and better utilise data to identify risks, harms and efficiencies, including risks affecting vulnerable populations. It also encourages greater collaboration between regulators through permitted information sharing and streamlined data requests.
ASIC is urging superannuation trustees to effectively use member complaints to identify systemic issues and improve services. The regulator found almost one quarter of trustees were not regularly analysing complaints data despite regulatory requirements.
ASFA appointed Australian Retirement Trust Chief Kathy Vincent and Brighter Super Chief Kate Farrar to its Board of Directors.
The ABS reported that approximately 82 per cent of businesses found that AI did not impact the level of job vacancies in August 2026. Four per cent of businesses reported that AI had reduced the number of job vacancies, while less than one per cent reported that AI had led to an increase in vacancies in their business.
DFAT and Defence
Jim Chalmers co-chaired the sixth Australia-China Strategic Economic Dialogue with Chairman Zheng Shanjie of China’s National Development and Reform Commission (NDRC). Chalmers described the discussions, which focused on shared economic challenges amid ongoing global volatility, as positive and productive.
The Australian Government imposed targeted sanctions on four Sudanese individuals and one entity, including leaders of both the Sudanese Armed Forces and the Rapid Support Forces, in response to the conflict in Sudan. It also called on all parties to agree to a ceasefire and allow humanitarian access.
Matt Thistlethwaite travelled to China to lead Australia’s delegation at the 2026 China International Import Expo. While in Chengdu, he visited companies and institutions showcasing technology and innovation, including Cochlear’s advanced manufacturing facility, the West China Marshall Research Centre for Infectious Diseases, Olymvax Biopharmaceuticals and Sichuan Agricultural University.
Energy, Agriculture, and Resources
ARENA invested $15 million in Hadean Energy’s hydrogen pilot in Victoria, testing Australian-developed technology that could use around 30 per cent less electricity than conventional electrolysers.
New South Wales opened consultation on a draft review of the state’s electrical and gas safety regulatory framework. The review examines the effectiveness of existing safety arrangements and proposes changes to improve regulatory oversight, clarify responsibilities and address emerging risks. Submissions close on 20 November, with a final report expected in January 2027.
The Queensland Government announced funding support for Peabody’s expansion of its Centurion mine gas power station from 5 MW to 20 MW, using captured mine gas to generate electricity and reduce emissions. Construction also commenced on Yancoal’s 30 MW gas power station at Kestrel mine, expected to operate from early 2027.
Infrastructure, Transport, Housing and Communications
Anika Wells announced $31.5 million for 54 news organisations through the News Innovation Fund to strengthen local journalism and help publishers adapt to digital change. Funding will support expanded Auslan news coverage, regional Indigenous reporting, and digital and commercial improvements for Country Press Australia publishers.
The Albanese Government announced a new parliamentary inquiry into the sustainability of Australia Post amid declining letter volumes and changing consumer behaviour. The inquiry will examine opportunities to expand and diversify post office services, with a report expected in the second quarter of 2027.
The NSW Government invested $90 million into Transport Oriented Development (TOD) Accelerated Precincts to prepare these areas for 60,000 new homes over 15 years. The funding will help nine councils deliver 20 walking, cycling, and street upgrade projects by 2029.
Health, Education, and Employment
The Government’s national network of long-acting reversible contraception (LARC) Centres of Excellence is now open. The centres offer free contraceptive advice, IUD and implant insertion and removal, outreach services and training for health professionals.
Jason Clare announced a national school reform package, including a digital detox through screen-time limits, restrictions on generative AI in assessments, maths curriculum reform, strengthened civics and antisemitism education, and the establishment of a national Teaching and Learning Commission.