Dr Chalmers will argue that with annual economic growth at its lowest since the global financial crisis and private demand at its weakest since the 1990-91 recession, it was clear the living standards of most Australians were deteriorating.
“Put bluntly, the Australian economy is running on fumes. Growth is too weak, too uncertain, and too narrow,” he will say.
“It’s neither trickling down to the people nor out to the suburbs.
“The greatest threat to Australia’s future growth is a cancer of complacency which cripples this Morrison government.
Dr Chalmers will reveal Labor plans to target three key broad economic issues around supporting consumption, boosting productivity and investment, while also dealing with “megatrends” such as changing technology and demographic challenges.
He will signal a co-operative approach in stark contrast to the “top end of town” rhetoric employed by former leader Bill Shorten ahead of this year’s election.
“[We will approach] the task of reform with a mindset of genuine partnership and co-operation,” he will say.
His approach will be followed by another later in the year as Labor attempts to map out its economic message.
The Treasurer, however, will use his own series of addresses over the next few weeks to highlight what he will argue are the economy’s current strengths now and in the near future.
He will map out the challenges facing the economy on Tuesday in a speech at the Australian National University, followed by a series of other public speeches in coming weeks before the release of the mid-year budget update in mid-December.
That update will have to contain major changes to its forecasts with the economy in a starkly different situation than in April when Mr Frydenberg handed down the 2019-20 budget.
The update will have to contain downgrades to growth and wages while making room for extra commitments to deal with the drought and the interim report from the aged care royal commission.
Despite the downgrades, Mr Frydenberg may have a short-term boost due to continuing high commodity prices plus a jobs market that is growing by more than 300,000 people a year.
On Friday, the heads of both the Commonwealth and Westpac banks said the economy would be boosted if the government brought forward tax cuts that are legislated to begin in 2022. Both said further interest rate cuts would fail to lift confidence and increase consumer spending.
Shane is a senior economics correspondent for The Age and The Sydney Morning Herald.