Debate is raging over a looming interest rate hike and whether there is light at the end of the tunnel for struggling Australians.

Minister for Social Services Tanya Plibersek and One Nation MP Barnaby Joyce went head-to-head in a heated discussion about how the nation can wriggle free of economic pressures.

WATCH THE VIDEO ABOVE: Sunrise hosts heated debate over a looming interest rate rise.

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“The light that they see at the end of the tunnel is a train coming to run them over,” Joyce told Sunrise host Nat Barr on Monday.

The Reserve Bank of Australia (RBA) is expected to raise interest the official cash rate for the fourth time this year on Tuesday, lifting it to 4.6 per cent, which would out it at the highest level in 15 years.

Economists are divided on whether the nation will see a fifth rate rise before Christmas.

“Nobody wants to see rates go up, we know that it adds to the pressure that families are feeling,” Plibersek said.

A predicted interest rate rise would significantly impact monthly payments for mortgage holders. Credit: Sunrise

Plibersek said the government is trying to make things cheaper in other ways, listing conflict in the Middle East as part of the global pressure impacting the Australian economy.

“We’re making it cheaper to see the doctor, cheaper to buy medicines,” Plibersek said.

Government spending under the microscope

Plibersek knocked back Barr’s questioning over whether the government is overspending.

Barr said the International Monetary Fund recently inferred as much, and former Sunrise host David Koch directed a similar sentiment in an open letter to RBA governor Michele Bullock last week.

“The basics of the Australian economy are very strong. We are one of only nine countries that has a AAA credit rating from all three major ratings agencies,” Plibersek said.

“We’ll continue to bring down those government costs in a way thats responsible, but at the same time, we want to keep helping people.”

But Joyce, a long-time critic of the “so-called renewables sector” placed the blame directly on the Labor government’s “discretionary spending” on “intermittent power”.

“Renewable energy is bringing prices down,” Plibersek said. “What would you do?”

Barnaby said he would go back to the “fundamentals of ecomics, which is basically coal-fired power”.

Sunrise host Nat Barr questioned Minister for Social Services Tanya Plibersek and One Nation MP Barnaby Joyce on solutions to the nation’s economic pain. Credit: Sunrise

A heated discussion quickly ensued over the hypothetical cost of refurbishing each of the nation’s aging power stations, after Barr highlighted that “the coal stations are breaking down ... which need a lot of money.”

“You can’t do much better than Snowy Hydro 2.0 ... It was going to cost $2 billion, now its $42 billion, you could refurbish every power station in Australia with that,” Joyce said.

Joyce cited an estimate published by critics in March, but the official Snowy Hydro 2.0 costing currently sits at about $12 billion, with the company expected to make a new estimate public within weeks, with speculation the cost will climb to about $20 billion.

“Okay, so that’s where you’re going to start?” Barr said.

“He’s going to refurbish every coal-fired power station?” Plibersek questioned. “You’re a party now that wants to be taken seriously. Is that what you’re going to do, Barnaby? How much would that cost?”

“Well, look at what you’re doing,” Joyce snapped back. “You’re destroying the economy and you’re keeping it a secret.”

“I can’t even get a word in without Barnaby shouting at me,” Plibersek said.

The discussion continued to heat up as Joyce demanded figures for the Labor government’s capacity investment scheme, and said he would need that costing before he could work out whether there would be savings in a coal sector a makeover.

Plibersek said the renewable energy investment numbers are all available in public budget documents, but the One Nation MP slammed her redirection as a lie: “They’re not there.”

“Can someone look?” Barr said, wrapping up the debate for the time being.