E&OE TRANSCRIPT
RADIO INTERVIEW
ABC MELBOURNE MORNINGS
WEDNESDAY, 20 NOVEMBER 2019
SUBJECTS: Liberals' infrastructure announcement; Ageing population; Record household debt.
VIRGINIA TRIOLI, ABC MELBOURNE MORNINGS: Jim Chalmers is the Shadow Treasurer. We invited Josh Frydenberg, the Treasurer, on the program this morning, and there was no response from him. Jim Chalmers, though, good morning.
JIM CHALMERS, SHADOW TREASURER: Good morning, Virginia.
TRIOLI: The Reserve Bank has been calling for it for months, the business community, the IMF has wanted to see it for some time too, and Labor as well. Is it too late?
CHALMERS: That remains to be seen, Virginia. I think overall what we're seeing today is an admission that the economy has been much weaker than the Government's been telling us. For months now in the face of all of those calls from all of those organisations the Government's been saying that their policy settings are bang-on and that the fundamentals of the economy are strong. With this announcement today I think we can conclude that the Government has been wrong all along.
TRIOLI: We'll leave it for others to conclude whether the Government's been wrong all along. The comment from the Prime Minister is a panicked reaction to contemporary challenges would amount to a serious misdiagnosis of our economic situation, thereby implying that to do it any earlier would have been a panicked reaction. It wasn't needed earlier, seems to be the strong suggestion there?
CHALMERS: We don't agree with that and nor does the business community, the IMF, or the Reserve Bank. A whole range of organisations have been calling for measured, proportionate stimulus to boost an economy which has been floundering.
What the Prime Minister is announcing today isn't a comprehensive plan to deal with the weakness in the economy, particularly the deterioration in the economy since the election. It won't on its own deal with the slowest growth in a decade, the weakest business investment since the 90s recession, weak retail, stagnant wages, and almost two million Australians who are looking for work or more work.
We've been calling for this step to be taken. The Government has been saying that nothing needed to be done until now. It's not a comprehensive plan yet. It's not what all of those organisations want to see to boost an economy which has been floundering on the Liberals' watch.
TRIOLI: The trouble is that at the moment this money will be earmarked for the big infrastructure projects that State Governments might have ready to go but we now have an incredibly high cost of construction and also labour shortages and therefore high costs of labour too, and some material shortages as well. While the money is there to go, it may not actually be able to be spent in an effective way right now.
CHALMERS: There's a couple of important points to make about that. Firstly, there are skills shortages in some parts of the economy and in some parts of the workforce which is really disappointing when many of these skills shortages have been around for a long time. It's remarkable that we've got skills shortages and wage stagnation at the same time.
As it relates to infrastructure, this Government has got form when it comes to promising things and not being able to get the money out the door, something like $5 billion of promises have been made by the Government but not delivered, as Catherine King and Anthony Albanese keep reminding us. There still is capacity in the labour market and in the infrastructure market to do more -
TRIOLI: Just to jump in there, Jim Chalmers, in the construction part of the market?
That's certainly not what we're being told by those who are engaged in the big projects. They're saying they can't see any slack in that part of the market where it could now quickly be built if the money started rolling for these projects.
CHALMERS: It's a different story in different parts of the country. With some types of projects it’s easier to fill labour and material needs than others. We've said all along that we're conscious of that but it's still possible to bring forward infrastructure investment. It's still possible to get some of these projects rolling earlier.
In term of Mr Morrison’s announcement today, Virginia, most of the projects are off on the never-never. Even what they're announcing today, the bulk of it is more than three and four years away. The economy is floundering right now. We need to see a more comprehensive plan to boost growth in the economy than what we're seeing today.
TRIOLI: I just want to get to on a couple of other quick issues if I can while we have you here, Jim Chalmers. The Council on the Ageing and PWC among others have endorsed the Federal Treasurer's call for us to keep being retrained through our working life. Do you agree?
CHALMERS: Obviously we need to keep training people through the course of their working life. That is a no-brainer. What a lot of seniors’ groups are reacting angrily to from Josh Frydenberg’s speech earlier in the week, is the return to work-until-you-drop. This is a Government that tried to increase the pension age to 70 and cut the pension. They're attacking superannuation now. People are rightly saying hang on a minute, we've got almost 2 million Australians wanting to work or more work, when there's been a 45 per cent increase in the number of people over 55 years old on Newstart, and when training has been gutted, how are we going to deliver on what the Treasurer is talking about? There has been quite an angry reaction to Josh Frydenberg's speech -
TRIOLI: Not from the Council on the Aging which is a peak body representing older Australians. It's not fair to characterise them as being angry.
CHALMERS: But that's not the only group. They're an important group but not the only group that have reacted to the Treasurer's speech.
TRIOLI: No but a peak group, and also to be fair this is not the first Treasurer of any political stripe to suggest that we need to keep working. Labor Treasurers have made the same indication themselves.
CHALMERS: It's been clear for some time that our population is aging. It has been clear for some time that people need retraining as they progress along their working lives. But at a time when the big growth in Newstart recipients has been in over 55s, when there's been big cuts to training, when the Government tried to increase the pension age and now when people hear that idea they'll working until they drop, I think that there is a lot of understandable concern in the broader community.
TRIOLI: And just finally, the record levels of household debt that Australia has at the moment - highlighted by our very own Alan Kohler over these two specials on 730 over the last couple of nights - what's the solution to that? If you were in charge right now, what would be the first thing you would do to try and grapple with the issue of Australian household debt?
CHALMERS: Alan's stories have been really important. For the first time in our history, people's debt is more than double their annual income. Household debt has never been higher than it is right now. It's largely a function of a couple of things, but one of them is stagnant wages. We need a wages policy. We shouldn't be hacking into penalty rates. We shouldn't be hacking into wages or attacking unions because stagnant wages is a big part of the household debt story.
TRIOLI: Jim Chalmers, good to talk to you this morning. Thanks very much.
CHALMERS: Thank you, Virginia.
ENDS
