JIM CHALMERS
SHADOW TREASURER
MEMBER FOR RANKIN
E&OE TRANSCRIPT
RADIO INTERVIEW
ABC MELBOURNE
WEDNESDAY, 23 MARCH 2022
SUBJECTS: 2022 Budget; Address to Australian Chamber of Commerce and Industry, Costs of living skyrocketing under Scott Morrison while real wages go backwards; Tax reform; Kimberley Kitching.
VIRGINIA TRIOLI, HOST: Jim Chalmers joins me now, the Shadow Treasurer, to talk about just what the ambitions might be if the Labor opposition was elected to government. Jim Chalmers, good to talk to you. Good morning.
JIM CHALMERS, SHADOW TREASURER: Thanks for having me on your show, Virginia.
TRIOLI: In a speech that you gave yesterday to the Australian Chamber of Commerce and Industry you spoke about how Australia's economic recovery could be derailed, you said, if consumers fail to tap into all the money that they have saved during COVID shutdowns around about $250 billion. So does economic recovery rely largely on us as individuals?
CHALMERS: I think that's a big part of the story Virginia but also governments, also central banks as they raise interest rates no matter who wins the election, also how the markets respond to all of the global uncertainty. The point that I was making at the Australian Chamber of Commerce and Industry was that the economy is recovering and that's obviously welcome, it’s coming off a low base, but it's recovering and that's a good thing. But five or six times in the last couple of years, the government's told us that things were about to come good and then because of some kind of complacency, whether it's on the vaccine rollout, rapid tests or purpose built quarantine, that recovery has been cruelled. So we can't be complacent about it. We've got good reason to be optimistic about the future but we're going through a period of uncertainty right now which puts the onus on government to ensure that the budget next week is a plan for a better future for Australia and not just a plan to get the government a fourth term.
TRIOLI: Alright, let's return to my question. I mean, we talk about, what the plans may be by you and by the government as well. But if the major part of the recovery is about us tapping into our savings, I've not actually heard a political leader speak about that in such blunt terms before, that we're hanging on to savings and that that's a bad thing, and we need to get out of it actually spend them.
CHALMERS: The point that I was making is more that not everybody has a buffer, a lot of people are doing it incredibly tough, we need to recognise that first. Everything's going up except people's wages, and that's probably the defining issue in the economy: the fact that prices are skyrocketing, real wages are going backwards and many people are falling behind. But for a lot of Australians, they have taken the opportunity to save over the last couple of years, around $250 billion. That's an advantage. It's something that we have going for us and one of the things that both sides of politics recognise. I've heard the Treasurer talk about this and on this particular aspect I agree with him, we do need some of that money circulating in our small businesses, local economies and local communities. People will make their own responsible decisions about their own family budgets. But we do need to see people have the confidence to be able to spend in our economy. Unfortunately because we've got all this inflation and we've got real wages going backwards, we've seen these big drops in consumer confidence. Yesterday there was a massive drop in consumer confidence. So the job of the budget needs to be to help people get through difficult times not just help the Coalition through an election. That means doing things like responsibly supporting families, as they're dealing with these massive cost of living pressures and real wages going backwards. But it also means having a plan for a better future and growing the economy the right way in areas like child care, skills, cleaner and cheaper energy, a better NBN and a future made in Australia and that's what the speech was about.
TRIOLI: Does that mean then, if you acknowledge that not everyone has that buffer in the bank and that's clearly true, but some do. Does that mean that these calls that seem to be increasing for consumers, for ordinary voters to be given some sort of relief as cost of living giving pressures increase that actually, we have the answer ourselves in our savings? Is that the corollary of what you're saying, Jim Chalmers?
CHALMERS: Again, not everyone has a buffer, as you just acknowledged, but I think that there is a role for government to provide some cost of living relief. Let's see what's in the budget. We have been pretty constructive over the last couple of years, if the government's looked to provide some kind of relief, we're typically pretty forward leaning about that, but it shouldn't just be about getting the government through an election. The government now pretends that they care about these cost of living pressures because they've worked out that we're only maybe seven weeks or so from an election. If they really cared about the cost of living pressures, they wouldn't have spent the last decade going after people's wages and job security. That's a big part of the story, which doesn't get talked about enough, the fact that real wages are falling. A big priority for us to get those real wages growing again. We also need to recognise, and the government wants your listeners to think that these cost of living pressures just showed up because petrol went up after Russia invaded Ukraine. The pressures on Australian working families didn't begin with the Russian invasion of Ukraine, they began with the government's attacks on wages and job security.
TRIOLI: I want to ask you about that. I mean that's something that we just played a moment ago, your observation that if the government truly cared about the cost of living pressures on Australian families, "they wouldn't have spent the best part of a decade going after their wages and their job security". What do you mean by that? How did the government go after wages?
CHALMERS: In multiple ways. For example, cutting penalty rates is a big part of the story. A lot of industrial relations changes designed to weaken the bargaining position of Australian workers. The approach that they've taken to labour hire, which has undermined wages growth and the approach that they've taken to job security. We had the longest serving Finance Minister of this government say that stagnant wages were a deliberate design feature of their economic policy. We've seen the fruits of that not just over the last few weeks, not just over the last few years, but over much of the last decade, we've had stagnant wages, historically low wages growth and real wages are actually going backwards. This means that families can't keep up with the skyrocketing cost of living. Everything is going up except for people's wages. When you talked in your intro about the battlelines election, I think it should be an election about the economy. The economy is about these pressures that working families are under. They're falling behind, because they've got a government that goes after their wages and job security and doesn't understand those costs of living pressures.
TRIOLI: Tell us exactly how you would lift those wages then without having an industrial relations wars breaking out left, right and centre. How do you precisely get those wages increased?
CHALMERS: We need to deal with this issue on a range of fronts. It's such a big and entrenched over the last decade. So dealing with things like labour hire, making sure that people get the same pay for the same job. That's part of the story. Making sure the Fair Work Commission has the ability to turn long term insecure jobs into long term more secure jobs when we're dealing with aspects of casualisation…
TRIOLI: Just to jump in there for a moment. How then do you ensure that those wage increases then don't turn into a further pressure on cost of living increases by driving up the cost and the prices of the things that these people are being paid to produce? Whether will be passed on costs wouldn't there?
CHALMERS: That's not the risk here. The risk here is that we don't have enough demand in our economy because people are too worried to spend and they're not getting the responsible wages growth that they need to keep up with the cost of living, and that has impact on local communities and local small businesses. I think that's well understood across the community. The primary risk here is we've got inflation of two kinds. Yes, some of it is turbocharged by Ukraine, but it's an issue that's been around for longer than that. It's not just petrol, but that's the big part of it. We've got rent, childcare, other costs of living are going through the roof. If Australian working families cannot keep up with those skyrocketing cost of living because their real wages are going backwards, the whole economy and the whole country pays a price for that.
TRIOLI: Would a Labor Government, should you win government, how prepared are you to tackle major tax reform? We've had some pretty important and in one case very well regarded bit of tax reform that took a great deal of time and money to actually research and procure that's been completely ignored and left to gather dust on the shelves. It's probably outdated now. But do you have the appetite for that?
CHALMERS: Our major priorities are in some of those areas that I just ran through a moment ago and I won't run through them again. But we said that there might be opportunities, for example, when it comes to working with other countries to make sure that multinationals pay their fair share of tax here in Australia, where they make their profits. There is a big global movement here that Australia should be part of. I think there is an opportunity there for some ambitious tax reform when it comes to multinationals. That will be good for Australian businesses who do the right thing and pay their fair share of tax here.
TRIOLI: There's agreement across two sides of the aisle on that about making multinationals pay more but on a more micro basis here in Australia. Is the appetite there and what's the particular focus?
CHALMERS: I wouldn't see tax reform as the highest priority of an incoming Labor government for the reasons I've just outlined. We've got other priorities, but there's an opportunity in multinational taxes. I think there is a conversation to be had with the states about state tax reform if there's an appetite across the different parties that are governing our states, and we'd certainly want to lead that conversation. So there might be some opportunities there. But we're not talking about or thinking about taking the same kinds of policies to this election that we took to the last election. Our priorities lie elsewhere. We think that there is a big ambitious agenda there to grow the economy the right way and to have a better future in our economy if we deal with things like skills, childcare, cleaner and cheaper energy, the NBN, co-investment in a future made in Australia. These are our priorities when it comes to the economy so that we can get cost of living down, get real wages growing again, but also make sure that our economy and the recovery works for more people.
TRIOLI: I just want to ask you one question on another issue, which doesn't go away before I let you go, Jim Chalmers and that's your party still being characterised as having bullies in the ranks. How do you make sure that this issue doesn't become a big one for you at the federal election and doesn't overshadow whatever it is that you're trying to argue. Is a properly convened, independent inquiry, the way to do that, or do you resist that idea?
CHALMERS: We won't be going down that path, I think as Anthony Albanese might have made clear this morning.
TRIOLI: Yes but do you think that on reflection that actually might be the way to cauterise it?
CHALMERS: No I think the way the best way is to first of all honour Kimberly's memory, of course. Secondly, to make sure that our processes always keep up and are always under review when it comes to dealing with complaints that people might make from time to time, even those that are contested. I think thirdly, the big responsibility, as I think was said by Bill Shorten and others at the funeral, we've got a responsibility to get around each other. It's an incredibly sad and difficult time. We've got responsibilities to each other in our Labor family, and we've got responsibilities to the nation. I think one of the ways that we can pay tribute to Kimberly's immense and courageous contribution is to change the government, which is what she wanted.
TRIOLI: Good to talk to you this morning. Jim Chalmers. No doubt we'll talk again. Thanks so much.
CHALMERS: Thanks Virginia.
ENDS
