JIM CHALMERS MP
SHADOW TREASURER
MEMBER FOR RANKIN
E&OE TRANSCRIPT
TELEVISION INTERVIEW
ABC CAPITAL HILL
WEDNESDAY, 12 MAY 2021
SUBJECTS: Budget 2021
JANE NORMAN, HOST: The Shadow Treasurer Jim Chalmers has been watching the Budget coverage as well as today's post-Budget speech and he joins me now. Jim Chalmers, thanks for your time. Could you ever imagine a Liberal Treasurer would be handing down that kind of Budget?
JIM CHALMERS, SHADOW TREASURER: It's important we start with something really important that Josh Frydenberg said in his speech just then, which I agree with 100%, he said that it's a Liberal Budget. It’s a Liberal Budget in one really important aspect; even with $1 trillion in debt, even with the $100 billion of new spending last night, the Government still expect real wages to actually fall. Only a Liberal government could spend that much money and still leave workers behind copping a real wage cut.
NORMAN: It is a lot of money to spend with few gains on the wages front. But, how do you get wages up?
CHALMERS: Well it's partly about getting the unemployment rate down but also dealing with underemployment. There is a lot of insecure work which has been a problem in our economy - not just because of the pandemic but because of eight long years of this Government. But, you also need to deal with some of the structural issues in childcare, in skills and training, in industrial relations - making sure people can actually grab the opportunities of a recovering economy. Our criticism of last night is that we think it is a massive missed opportunity. It's not a recovery if people aren't getting real wages growth. It’s not a recovery if people are getting left behind or left out in the cold, but that's what the Government's own Budget is predicting.
NORMAN: The RBA and Treasury both said that wages growth, inflation, will only accelerate when you can get the unemployment rate below 5% - with a 4 in front of it. Isn't that what this Budget is forecast to achieve?
CHALMERS: The big part of the story is getting that unemployment rate down but underemployment and some of the other issues which are preventing people from getting into work, not just getting into work but having enough hours to support their loved ones, so the unemployment rate is part of this story. What matters with this Government is not how many jobs they forecast, it’s how many good, secure, well-paying jobs they actually deliver.
You’d remember the centrepiece of the Budget last year was supposed to create 450,000 jobs – it created 1,000 jobs. If you had a mate who owed you $450 and gave you one dollar – you wouldn’t think that job was done.
So I think those kind of jobs forecasts - we have to see them to believe them. But there is an important task to be done here: get unemployment down and deal with underemployment and deal with some of those other issues. There is a reason why the Budget doesn't forecast any real wages growth and that’s because all of those other issues have been piling up for eight years and this Budget doesn't undo the damage of the first seven.
NORMAN: OK lets go through some of the big policy announcements last night and the centrepiece was the $18 billion aged care spend. $18 billion on home care packages, overhauling regulation, changes in staffing times for residential aged care residents, what do you think of this, where are the holes here that you would seek to fill?
CHALMERS: We are working our way through the detail, but it’s a fact that even with that big commitment of funds it falls short of implementing the Royal Commission recommendations. Your viewers would know that the Royal Commission made a series of recommendations. They uncovered some truly harrowing accounts of maggots in wounds and people malnourished and all the rest of it, so aged care has been a disgrace, frankly. The system has been a disgrace for some time. The Government has made some commitments that we will work our way through but they haven't delivered on the recommendations of the Royal Commission.
NORMAN: The Government has rejected about six recommendations and some others under review but the most significant it rejected was the proposal to fund the aged care system through a levy, would Labor consider that?
CHALMERS: We are working our way through the commitments in the Royal Commission which are about workforce and some of the other gaps the Government left last night. That’s our first priority.
NORMAN: The Government would argue it is funding 33,000 training places for people to obtain a Certificate III, that’s going some way?
CHALMERS: I think that’s a good description. I think they have gone some way but they’ve fallen short of implementing the recommendations, I think that is self-evident. They have done some things - there maybe some things in there that we can support, but we will come to a proper considered view, we are talking about massive amounts of money, we don't make those kinds of commitments off the top of our head, we will take time to go through it.
NORMAN: Anthony Albanese he gets his chance to make the Budget reply speech, can we expect an alternative policy from Labor tomorrow night on aged care?
CHALMERS: We will have something to say about all the issues in the Budget, I think that’s obvious. But I think it is important to think about what Anthony will be talking about tomorrow - not just as a response to all the different pages of the Budget, but an alternative vision for Australia. One of the many deficits was a deficit of vision and understanding that it's not recovery if ordinary working people miss out and I think that will be Anthony’s focus.
NORMAN: What about paid parental leave, Labor’s National Conference has set a goal of 26 weeks of paid leave, paid at the full rate with superannuation. Do you agree with the platorm position?
CHALMERS: Well obviously as the creators of paid parental leave in this country, we are always looking for ways to improve it, but we have to weigh up other priorities. An extension of PPL, clearly, on it’s own, would be something that would be welcomed in the community but we need to weigh that up and work through it. We hope to create a long-term Albanese Government and we need to sequence the priorities and weigh them up against each other, so when we have something to say about PPL, we will say it then.
NORMAN: Right now it is 18 weeks minimum wage with no super, so there’s clearly a pretty big gap between the existing policy and the one the National Platform has put in as a goal for Labor?
CHALMERS: Yeah and that’s a good way to understand it. It’s a goal for Labor. It's for the Shadow Cabinet to determine our medium and long-term priorities, we will weigh those up against each other. When we have something to say about PPL, we will say it then.
NORMAN: I want to talk about the LMITO – the Government has extended that for another year, does Labor support that?
CHALMERS: Well we support tax relief for people on low and middle incomes. I think it is interesting they extended it to the other side of an election, another illustration this Budget is about getting through an election rather than helping people with the cost of living. Particularly when wages are so stagnant and real wages are going backwards in the Budget, that tax relief is really important. So, we support that but we do note that tax relief for low and middle income earners is temporary, whereas the vast bulk of the tax relief coming into the Budget in a few years time is permanent and that overwhelmingly benefits high income earners.
NORMAN: Would Labor consider making a tax offset like the LMITO permanent?
CHALMERS: Oh look we’re considering all of those things, we are looking at the income tax system in its entirety – whether it’s Stage 3 , whether it’s the Low and Middle Income Tax Offset. Again we need to weigh that up against all kinds of priorities and we will make our views clear on income tax between now and the election.
NORMAN: Now that the Budget forecasts are out and it makes it clear, we will still be in structural deficit in three or four years time when those Stage 3 tax cuts are due to kick in, is it your view that the tax cuts are affordable? Should they go ahead?
CHALMERS: We’ve said for some time that it does not make sense to commit massive amounts of money years down the track when the Government did not know what the economy or the Budget would look like. Our position on that has been vindicated by the fact that they have now jacked up $1 trillion in debt, so the Budget is not in any kind of shape and yet they have made a commitment that comes in four years down the track. So we said at the time it was not the most responsible way to do it. They are legislated now, we will look at it and make our views known between now and the next election so people know where we are coming from.
NORMAN: But you seem to be leaning to the more ‘unaffordable’ side of the debate?
CHALMERS: I would not necessarily say that – I think it is self-evident that it is a massive amount of money that comes in years down the track in our Budget where there is debt, many multiples of what the Coalition inherited and we need to weigh that up.
NORMAN: Finally just before we need to move onto our next guest, you have been very critical of the Government's handling of the borders but I guess the question is when and how do you think they should open?
CHALMERS: It depends on the vaccination rollout. The debacle here is the Prime Minister's failure to get vaccinations away on the timetable that he originally promised.
NORMAN: So you are saying we should open the borders when the whole population is vaccinated?
CHALMERS: I’m saying it will be safer to open the borders once we get the vaccination program under control. I think it is more confusing after the Budget than it was before. What are the costs and consequences of his debacle on vaccines, and when is the place going to open up? Simon Birmingham, Josh Frydenberg, Scott Morrison – they’ve all had different answers on this the last 24 hours or so. We cannot have a first-rate economic recovery with a third-rate vaccine rollout. That is self-evident. We need clarity from the Government and how they are going to do it.
ENDS
