The two most notable Labor promises before the May 2022 election involved ‘getting wages moving again’ and the promise to bring down electricity prices.

We heard them ad nauseam, yet it is worth quoting precisely what was said so that we can check on their progress.

Launching an energy policy at a press conference in December 2021, Albanese said that under him, ‘…Electricity prices [would] fall from the current level by $275 for household[s] by 2025…’

When questioned by a journalist whether he thinks the promise is feasible in such a short time, the Prime Minister replied: ‘I don’t think, I know.’

More than halfway through the government’s term in office, prices have actually risen by quite a bit. The Australian Bureau of Statistics (ABS) produces estimates of electricity price changes on a quarterly basis as part of its Consumer Price Index (CPI) survey.

The ABS summarises and aggregates all the electricity price information it gathers from around Australia into a statistical index number. An increase in the index number represents a rise in the price of electricity.

Albanese was elected in May 2022. This means that the first quarterly datapoint relevant to an analysis of electricity price changes under his administration is that of June 2022.

For that quarter, the ABS estimates the number 127.2 to represent the average electricity price across Australian capital cities.

The latest data we have is for the September quarter of last year. The ABS has published an electricity index number of 150.3.

By doing a simple percentage change calculation, divide 150.3 by 127.2 and subtracting one, I calculate an electricity price rise of 18.2 per cent.

Usefully, the ABS also produces separate index numbers for capital cities in each state and territory.

The numbers show, for example, Sydney recorded the highest electricity price rise (38.7 per cent), and Perth the lowest. In fact, electricity prices in Perth fell by 42.9 per cent from June 2022 to September 2023.

Another interesting way to carve up the data is by examining price changes under various Prime Ministers. This gives some indication of the priority the government gives to constraining utility prices.

Here the news is also bad for Albanese. So far under his government, the electricity price rises have been higher than any other government going back to 1997. Notably, electricity prices fell under his predecessor Scott Morrison – at least according to the ABS index data.

After Albanese, the next two worst Prime Ministers for electricity prices since 1997 were Julia Gillard and Kevin Rudd. The ALP does seem to value high energy costs.

Turning to wages and the claim that under the Coalition there was a deliberate strategy to keep wages low and that Albanese would get wages moving again.

In his budget reply to speech on 31 March 2022, Albanese said:

‘This Government wants to keep your wages low…

‘And this is a central difference between this government and Labor on jobs and on cost-of-living…

‘The truth is if you want real, permanent, meaningful help with the cost of living, you need a plan to get wages growing again. And you need a Labor Government to do it.’

In assessing wage rises, it is important to read carefully what Albanese said. He wants wages higher to help with the cost of living. In other words, what’s important is that of ‘real’ wage rises. This makes perfect sense.

If your wage increases by $20 but your grocery bill increases (due to inflation) by $30, then your real wage has fallen.

The standard means of calculating ‘real’ wages is to estimate two data points. The first is the change in wage levels over some time period, typically either quarterly or annually.

The next step is to estimate inflation over that same time period, and then subtract it from the wage change estimate. Once again, the ABS provides ‘index’ numbers to represent both wage changes and general inflation.

In June of 2022, the ABS estimates the hourly wage index number at 140.1. As of September, the index is 147.9, so there has been some growth in wages paid. As a percentage, the increase is 5.57 per cent.

Over that same period, however, cost of living has also increased. The CPI for Australia as a whole has risen by 7.3 per cent.

By the simple calculation, this means real wages have fallen by 2.31 per cent – not a great look from a party that identified higher wages to offset higher living costs as a major reason for electing them.

Again we can compare Prime Ministers for ‘real’ wage outcomes over their tenure. When we do, you discover Albanese has overseen the highest quarterly average decline in real wages of any prime minister going back to 1997.

Real wages also fell under Morrison, but at a lower rate of decline than what has occurred under Albanese.

Whether Peter Dutton and the Coalition can take advantage of these poor outcomes is another matter, the media seem much less interested in real wages than they did before the 2022 election.

But what’s more certain, if these trends continue, is that real wages and electricity bills won’t again be a part of Labor’s sales pitch at the next election.

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Nick Hossack is a public policy consultant. He is former policy director at the Australian Bankers’ Association and former adviser to Prime Minister John Howard.

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