The Budget And A Better Future

05 April 2022

Address to The National Press Club of Australia 






Thank you Laura Tingle, Maurice Reilly and the Directors for this opportunity to speak at the Press Club for the fourth time this term.

For the first – and hopefully not the last! – time in this grand and auspicious Great Hall.

Recognising that the history of this place is just a tiny speck on tens of thousands of years of the world’s oldest culture.

Acknowledging the customs, elders, and traditions of the Ngunnawal and Ngambri people and all the First Nations.

And proud that an Albanese Labor Government will implement the Uluru Statement from the Heart.

I’m really grateful to Anthony for being here today.

But also for the opportunity to work in an economic team with outstanding colleagues and friends like Katy Gallagher; Stephen Jones; Andrew Leigh and Matt Thistlethwaite.

With other colleagues in the shadow cabinet and parliament who have joined us here, and with outstanding leaders in our federation like Andrew Barr.



Now on the face of it, the frantic last few days before an election’s called might not seem an ideal time to take a step back, to take stock of our economy, our country, or our future.

But with so much at stake, I think it’s the perfect time.

We’ve learned so much.

From mediocrity before the pandemic, catastrophe during it, and uncertainty now.          

From floods and fire; a pandemic; a war in Europe.

Before that, from the first recession in 30 years, and another deep and damaging downturn last year.

From the false starts and false dawns of this recovery, marred by policy mistakes and missteps.

From a nation which rose to the occasion each time, and a Government that fell back into old habits.

A people who were there for each other at every turn, and a Prime Minister who went missing – taking credit but never taking responsibility.

Now after nine long years, three treasurers and three prime ministers, the verdict is in.

Average economic growth at 2.3 per cent a year under this Liberal-National Government; lower than the 2.5 per cent of the last Labor Government.

Average productivity growth at 1.1 per cent a year under them versus 1.4 per cent under us.

Average wage growth, 2.1 per cent a year under them but 3.6 per cent under us.

Average business investment, -2.8 per cent a year compared with 5.5 per cent.

Average unemployment at 5.7 per cent under this Government versus 5.1 per cent under its Labor predecessor.

Multiplying debt, and deficits as far as the eye can see.

Fact after fact speaking to this one, disappointing truth:

This has been a wasted decade of missed opportunities.

Of families falling further and further behind, weighed-down by skyrocketing costs of living and falling real wages.

And now, not even a recovering economy, a recovering Budget, high commodity prices, an unemployment rate falling in welcome ways, not even the skills shortages that come with that, have brought decent wages growth.

Shouting louder and louder at Australians about how great they’ve got it and how grateful they should be, doesn’t make it true.



So, if the looming election meant the Budget couldn’t be an act of contrition, it should have at least been an act of recognition.

Not just recognition of today’s pressures, but recognition that those pressures existed well before the pandemic.

Understanding, that we can’t have a better future if we double-down and double-back on the failed policies of the recent past.

An acknowledgement, that nine years of waste and rorts in the Budget, and mismanagement of the economy, have delivered:

The worst wages growth of any government, ever.

The weakest business investment and productivity outcomes of the past thirty years.

The worst set of books ever presented before an election.

A Budget riddled with rorts and choc-full of wasteful spending.

A Treasurer personally culpable for tens of billions of emergency support for businesses which didn’t need it.

Another $5.5 billion wasted on subs that will never be built.

Sports rorts, car park rorts, dodgy land deals – the list goes on.

When Josh Frydenberg said from this lectern six days ago that his main “focus is on winning the election”, and when Scott Morrison talks about the Budget being a “shield”, they gave the game away:

This was a Budget designed to shield a Government from the people.

All about setting the Coalition up for a fourth term, not setting our country up for a better future.

That’s why it is a Budget unworthy of the Australian people, the sacrifices they’ve made and the struggles they’ve endured.

A Budget unfit for the scale and scope and severity of the challenges our country and our world are grappling with.

Australians deserved so much better, and the challenges of the moment demanded so much more.



At their best, Budgets bind together a government’s agenda and lay the foundations for the future.

They should be the ‘how’ in the story, clear and compelling proof of how a party’s promises and plans will matter for real people. 

A Budget should embrace the big task of finding a place for everyone in the unfolding story of national economic success.           

Think of it this way:

This huge tapestry Arthur Boyd produced for this room is not a traditional landscape, it’s a close-up of bushland.

Apparently, the impression he wanted to leave was of a story in the middle of its telling.

A story of vivid detail, clear and creative direction, but a destination not ever finally reached.

No rest, no end.

Governing is a bit like this too.

We should always be in the middle of that story.

By which I mean, we should be prepared to embark on new initiatives knowing we may not be around to take credit for their success.

That’s the weight of responsibility and the generational perspective a Budget should carry.

That’s the approach I want to take as Treasurer. 

Instead, last week we got a document that gloried in its shallowness and wallowed in its triviality.

Deliberately, overtly – insultingly – conceived as a prop for the election.

And celebrated by the Liberals and Nationals not for what it would do for the country, but just for giving them something to say in ads.

Last week’s Budget showed exactly what sort of campaign Scott Morrison and Josh Frydenberg will run.

Glib, incoherent, in denial of reality and silent on the future.

No ambition beyond their own survival.

No vision beyond election night.

We have to expect more than that from government.

If last week had been a Labor Budget:

It would have offered hope and support and resources to communities cleaning-up floodwaters and rebuilding after bushfires.

It would have delivered a plan for cheaper child care and stronger wage growth, easing families off the punishing treadmill of rising prices and flatlining pay.

It would have invested in Australian skills, small businesses and local supply chains, to grow our self reliance and our resilience and make our future here in Australia.

It would have put an end to 9 years of stupendous rorts, abuse and waste – and funded a National Anti-Corruption Commission.

It would have invested in productivity, so we can grow the economy more strongly without runaway inflation.

And – as Anthony Albanese made clear – a Labor Budget and a Labor Government would fix the crisis in Aged Care.

This is the least we can do for older Australians and the workers who care for them.

Because through everything the world has thrown at Australia over the past few years, our people have shown their best qualities.

But this Budget showcases the Government’s worst instincts.

Self-obsessed, short-term – and out-of-touch with reality.

A $103.6 billion improvement in the Budget courtesy of commodity prices and automatic stabilisers but still $1.169 trillion worth of generational debt without a generational dividend.

Another promise of wages growth, hoping people would forget they’ve been wrong 52 of the other 55 times they’ve forecast it.



We know prices for essentials like petrol, rent and child care were already skyrocketing even before Russia invaded Ukraine – while Australians’ real wages were going backwards.

We understand the invasion exacerbates this – and feeds into global investor uncertainty which had only just begun to recover in the aftermath of the pandemic and the recession.

We recognise geopolitical risks aren’t just rising in Europe, but closer to home too.

As we consider the implications for our national security and for our economy from a Chinese leadership which is becoming not just more assertive in tone but more aggressive in posture.

And just the other day, factory activity in China slumped at its sharpest pace in two years, reminding us that the global health uncertainty from the pandemic still isn’t over.  

We’ve all heard the Reserve Bank Governor warn that interest rates will rise before long no matter who wins the election – driving up the costs of borrowing for families, businesses and governments.

The wrong and risky response to this uncertainty, this context, this backdrop – is to continue on the current course and cling to the status quo.

The most damaging thing Australia could do right now - the biggest economic and social harm we could inflict - would be to accept flatlining wages, soaring prices, tepid investment and weak growth as our best case scenario, our new normal.

That’s not stability, that’s stagnation.



The warnings have been there, and have been ignored, for some time.

Australians have already paid too much for this complacency.

From a lack of disaster mitigation to a bungled vaccine rollout and a rapid testing debacle which emptied our supermarkets.

Cost of living pressures haven’t just shown up, out of the blue.

They aren’t just a consequence of Russia invading Ukraine; they’re a consequence of the Coalition attacking wages and job security.

That’s why the relief in this Budget isn’t even enough to make up for the more than $3,200 fall in real wages for the average worker these past two years.

But of all the failures in this Budget, all the drift and disappointment of the eight before it, the most glaring omission is the future.

Again, the warnings were plain for all to see, this time in the Government’s own Intergenerational Report.

It said if we do nothing to arrest our decline, we face an economy that is smaller than expected, growing slower than before and saddled with at least four more decades of debt and deficits.

And that’s even before we factor in lower productivity growth at the average of the most recent cycle under the Coalition.

In that more realistic case, the economy would be almost 10 per cent smaller by 2060 and Australians would be $32,000 worse off each, on average.

In the Budget over the same timeframe, the deficit would be 2.2 percentage points bigger, and net debt would be 22.7 percentage points higher than the substantial debt and deficits forecast already.



Australians can’t afford this complacency that’s characterised the Liberal and National approach to the economy.

That’s why we have said if we’re successful at the election we’ll hand down a proper Budget this year.

One which will implement our commitments, put in place our economic strategy, and begin the hard work of dealing with a legacy of wasteful and rorted spending.

Today in giving you a sense of that, you’ll see what the first half of a first term in my portfolio might look like if we are successful.

The economic strategy, the fiscal strategy, that we will run alongside our white paper on the labour market and our review of the Reserve Bank and the intersection of fiscal and monetary policy.

One belief unites our whole approach:

That an economy and a society stronger after COVID than before, is within reach.

Our plan for economic growth invests in the future, targets cost-of-living pressures and supports sectors that will improve our lives, create more secure new jobs, and grow our economy.

Each of our investments are designed for a generational dividend, and not just a six to seven week pay off.

Instead of a panicked, political pamphlet we offer a plan.

It has five parts:

A Powering Australian policy to get energy costs and emissions down as we transition to new sources of cleaner energy.

Hundreds of thousands of fee-free TAFE places to address the skills shortages acting as a handbrake on our economy.

Cheaper, more accessible childcare to build a bigger workforce able to work more and earn more if people choose to.

More modern infrastructure, including key investments in upgrading the NBN and the digital economy.

And a future made in Australia, made possible by smart co-investments in crucial sectors like manufacturing and the care economy and boosting the resilience of small business.

This five-point plan will lift the productive capacity of the economy and lift the speed limits on growth, without adding unnecessarily to inflationary pressures.

It will help create the more secure work and the stronger wages growth we need.

By training people for higher-wage opportunities, by making it easier for mums and dads to go back to work, and by ensuring we’re dealing with issues around labour hire, the gig economy and casualisation which have undermined wages for too long.

So much of what we propose will deliver more than one benefit to our economy, its workers, families and employers.

For example, investing in cleaner and cheaper energy will cut emissions.

But it will also cut power bills by $275 a year by 2025, unlock $76 billion of investment and create over 600,000 jobs, most of these in the regions too.

Fee-free TAFE and more university places to equip Australians with critical skills will go some way to addressing the crippling shortages which are holding so many Australian businesses back.

TAFEs and universities add billions to the economy each year but also help Australians take advantage of the best opportunities.

For example, Deloitte has recently found average digital skills are attracting a wage premium of around 9 per cent, equivalent to an additional $7,700 per worker every year.

Upgrading the NBN could help us capture a digital opportunity which AlphaBeta has estimated could be worth $207 billion in GDP per year by 2030 if Australia caught up to global leaders.

But it will also make it easier for Australians to decide how they work, and where they work from, in the post-pandemic economy.

A Future Made in Australia with procurement and co-investment plans will create new jobs and revitalise our regions with new industries and more opportunities in more parts of Australia.

And it also will help shore up our supply chains and make them more resilient.

Cheaper child care will boost GDP from higher participation by at least three times as much as the Government’s alternative.

But it’s also great for kids and helps alleviate cost pressures on working parents.

Our aged care policy is all about doing the right thing for older Australians and those who care for them.

But again there’s an economic dividend that flows from investment in such a big part of the care economy.

Last year, after steady growth over the past decade, the health and social assistance sector made the second largest contribution to GDP of any industry.

Ten years ago, it wasn’t even in the top five.

And when it comes to aged care specifically, the sector employs close to 400,000 Australians and generates tens of billions of dollars in wages paid, in total revenue and in GDP value-added every year.

So, each element of our plan reinforces the other.

Our policies were designed and developed together – and they work together, as a coherent strategy in pursuit of clear objectives.

That’s the product of 103 hours of careful, considered deliberations of our Shadow Expenditure Review this term.

And it’s what bang for buck looks like.



Instead, we get cash shovelled in the general direction of voters in the hope they’ll forget a decade of flatlining living standards.

From the most wasteful government since federation.

To paraphrase another Queenslander, I say this to Scott Morrison and Josh Frydenberg:

This reckless rorting and wasteful spending must stop.

If it’s not the time to flick a switch to austerity, it is the time to flick a switch to quality, to smart investments in the future.

Because the best way to repair the Budget is to get the economy growing in a broader, more sustainable, more inclusive way.

Contrast the bleak picture from the Intergenerational Report with the opportunities before us if we choose the right path.

PwC has estimated with growth just 0.5 per cent higher per year than what is currently projected, the structural deficit would close and would reach zero net debt fifteen years earlier.

That’s why we want to be judged on the quality of our spending, to the extent that it delivers the right kind of growth.

We will be investing where it counts to create more opportunities, unlock business investment and drive productivity. 

This has never been more important than right now where we know that our economic pressures lie on the supply side.

That’s why the quality of spending matters as much as the quantity.

We are acutely aware of rate hike risks and what this means for household and federal budgets.

The Commonwealth Bank’s latest forecasts are that a cash rate of around 2.5 per cent, in line with market pricing, will push mortgage payments as a share of household disposable income to a record high.

This reflects the worsening housing affordability under the Liberals and the record household debt to income ratio, which has increased by 20 percentage points after remaining stable during Labor’s last term.

We know rising mortgages are bound to impact the recovery and the comfort of households in deploying the $250 billion worth of savings on their balance sheets.

So, we take these risks seriously.

But when you take two of our largest Budget commitments so far in child care and aged care, together they make up only one fifth of the Government’s new spending decisions that they unveiled in their latest Budget.

To put that into context, by 2025-26, our largest commitments will make up only 0.3 per cent of GDP spread over the next four years.

In comparison, the Government’s decisions in this year alone are larger – at 0.4 per cent of GDP – and represent around 1.5 per cent of GDP over the forward estimates.

So we maintain that our approach is necessary and responsible and right for the economic conditions.

So is our fiscal strategy:

Grow the economy the right way;

Focus on quality and bang for buck;

End the rorts and waste;

And work with other countries to make sure multinationals pay their fair share of tax in Australia where they make their profits.



When it comes to value for money it’s hard to think of a better investment than in aged care.

And for those of you tempted to write of the blurred differences between the major parties I offer you this as an example of one of the defining distinctions.

It has been disappointing but not surprising to see the lengths this Government will go to, to deny people decent care, decent food and decent wages.

I know they think they’re on a winner when they talk about the price we are willing to pay for tangible improvements in the lives of older Australians and the working lives of those who care for them.

First, our plan is fully-costed.

But second, do they hear themselves when they ask these questions?

That $2.5 billion is too high a price to pay to spare older Australians from neglect and abuse and literal starvation.

And even if somehow you could put that moral calculation aside, every time we are asked how we’ll pay for important investments in our economy such as child care and aged care, remember this:

The Government just spent $39 billion in a Budget without offsetting it.

They talk about temporary spending, but they’ve opened up a structural deficit that will see a deficit of 0.7 per cent of GDP in 2032-33.

They committed to $70 billion in spending between the December update and the March Budget alone.

They wasted $5.5 billion on subs that will never be built – more than twice the cost of our aged care plan.

They have wasted at least $30 billion on other rorts, around 12 times the amount we propose to invest in extra support for aged care.



The election campaign that officially begins in a few days is an opportunity for a proper national conversation about all the issues I’ve touched on today.

I repeat my challenge to Josh Frydenberg, to debate the Budget and the economy and the future – at least three times, here, in the west, anywhere we can make it happen.

He shouldn’t hide behind scare campaigns, or dishonest paid advertising, or try to fight the 2019 election all over again.

This campaign needs to be better than that.

Before Australians choose what kind of government they want, we first need to choose what kind of campaign we want.

When the Prime Minister spoke to you in January he said it wouldn’t be a referendum, it’d be a choice.

But it’s both.

A referendum on the past ten years – which sifts through the rubble of the Government’s economic credibility and the shards of the prime minister’s glass jaw.

And a choice to be made about the next ten.

The campaign to frame that decision can be a battle of one-liners or a contest of substance.

It can be spin and marketing, or it can be real talk.

About what’s confronting this country and what’s at stake.

Most of us in this room have roles to play.

But in the end, what we say, how or whether you cover it, what you write or produce, is only one small part of the big, shifting, sprawling conversation that every election represents.

At a national and local level, for communities and for individuals, a whole host of complexities will decide who Australians choose to govern them.

And we know that whoever wins government on the 14th or 21st of May, that when Australians wake up on the morning on the 15th or 22nd

Real wages will be going backwards.

Businesses will be short of staff.  Industries short of skills.

Child care fees and healthcare costs will be too high, for too many.

There will be conflict and tension in the world, far away and closer to home.

Our country will occupy a precarious place in global supply chains.

There’ll be a trillion dollars in debt and not enough to show for it.

Petrol prices and interest rates will be about to rise again, no matter who wins.

A long rebuild ahead, in places like Lismore and beyond.

But what I also know, is that if people wake up with a new Labor Government, then, for the first time in 9 years, there will be a Prime Minister, a Treasurer, a Cabinet and a Government with the determination and resolve and sense of responsibility to address these challenges.

And there will be a government that has the plans for a better future.

For a stronger, more resilient, more inclusive, more sustainable economy that creates opportunities and puts them within reach of more Australians.

Because we want to run this country, its economy, in the interests of its people.

A people who are, like Arthur Boyd’s tapestry, in the middle of our story.

The election will be tough and close.

The path beyond is challenging too.

So we’re not here to muck around or muddle through.

A better future depends on it.

Thank you.