Just as the battle between the Albanese Government and the Reserve Bank of Australia over inflation and interest rates escalates, following former Labor Treasurer Wayne Swan slamming the central bank for not cutting rates, along comes the story of insurers killing small businesses.

The Daily Telegraph reports that “skyrocketing insurance prices are ‘threatening’ Sydney small businesses, with one in four businesses suffering from premium hikes of more than 30 per cent in the past year.”

New research from Business NSW says that “more than 13 per cent of small to medium enterprises say insurance increases are putting their business at risk”.

Business NSW chief executive Daniel Hunter says

the cost of insurance is seen as the number one culprit putting heat on businesses. That competes with interest rates, power bills, human demands for big pay hikes, the cost of imports with a relatively weak dollar and government charges.

The effect of rising premiums is to see businesses reduce their insurance because being properly insured would force them to close their doors. The research says 20% have reduced their cover while 12% are taking the punt to operate without insurance!

Business NSW wants the state government to have oversight on premium increases to create “right-size” policies, so businesses aren’t overpaying on their insurance and for prices to be driven down in the next three years.

Given insurers are making bumper profits, the idea of governments naming and shaming exploiters of the current inflation situation looks acceptable. And this story shows the Resolve Political Monitor that while found 51% of voters blame the Albanese Government for high inflation and no cut in rates, and 27% think it’s an RBA mistake, there are other culprits.

The Government’s Budget tax cuts have kept demand up and prices as well. The Australian reports today that two-thirds of jobs created over the past couple of years have been funded by taxpayers via government policies.

The RBA wants to see higher unemployment before it cuts rates, so this isn’t good for Treasurer Chalmers and the PM who are wanting to absolve themselves from the level of inflation and the fact rates haven’t been cut.

The RBA’s action to raise rates 13 times and then not cut rates have both caused and sustained high inflation, as businesses facing higher costs on loans would pass this on, if they can, as higher prices.

However, RBA actions have worked in bringing inflation down from 8.4% in December 2022 to the 3.5% in the year to July. Their job would’ve been made easier, and rates might be on the way down, if the tax cuts hadn’t been delivered.

That said, there are other contributors to inflation including supermarkets, airlines, energy companies, importers and, of course, today’s headline-makers — insurers!

And don’t leave out state and local governments that slug businesses and consumers with extra excessive charges often to cover up their incompetence, poor productivity and pathetic business leadership.

Ask anyone who has tried to get plans to build in a fast and professional way and you soon hear about a litany of slow or no action obstacles that councils put in the way of a building project. These end up costing the applicant money, which is inflationary for the consumer. If it hits a business, that cost increase gets put into their pricing, which then adds to inflation.

A Simpson episode featured Bart as the “I didn’t do it kid”, which became a viral social media event. Despite everyone seeing him do something wrong, everyone laughed about a kid who patently lied. Inflation creates an “I didn’t create it” mentality from the groups who clearly did do exactly that. It’s time the culprits are exposed, named and shamed.