THE HON JIM CHALMERS
TREASURER
MEMBER FOR RANKIN
E&OE TRANSCRIPT
RADIO INTERVEW
ABC MELBOURNE MORNINGS
TUESDAY, 24 MAY 2022
SUBJECTS: 2022 Election, Swearing in of the Albanese Labor Ministry, Labor’s Economic Priorities, Operation Sovereign Borders, Fuel Excise
VIRGINIA TRIOLI: The Federal Treasurer and Labor MP for Rankin and he joins you now. Jim Chalmers, good morning and congratulations.
JIM CHALMERS: Thanks very much Virginia, and thanks very much for having me back on your show.
TRIOLI: First of all, do you have any more certainty this morning about the number of seats that you're going to end up with?
CHALMERS: Not complete certainty, Virginia. We are pretty confident that we will get to a majority in our own right, but that's not yet assured. There are still two or three bouncing around a little bit; more than we would like. But I think the most likely outcome is a narrow majority, but we will know more in the coming days, obviously.
TRIOLI: So 76 or 77, something like that?
CHALMERS: I haven't been paying as close attention as you might imagine, given some of the other things I've been working on, but my colleagues tell me that 76 or 77 is within reach. Most likely a narrow majority, but all of the possibilities are still on the table.
TRIOLI: Jim Chalmers, what's top of your list? What's your first big challenge as Treasurer?
CHALMERS: Working towards the October budget is really my highest priority. Working closely with Katy Gallagher, the Finance Minister, to go through the budget line by line, to see where we might be able to reorient spending away from wasteful spending ‑ which has been a defining feature of the budget for the best part of a decade ‑ into more productive investments in some of the areas that we nominated in the campaign. Whether it's skilling and training, or cleaner and cheaper energy, or child care and aged care, or a future made in Australia. The big concern that we have is that we are inheriting levels of debt which will take generations to pay down and we want to make sure that there is a generational dividend from that generational debt that we are inheriting from our predecessors.
TRIOLI: How do you define "generational dividend"? What does that mean?
CHALMERS: We need to grow the economy the right way. You know, where people, ordinary people, in real communities around Australia get to be part of a story of national economic success which is powered by cleaner and cheaper energy, and more investments in our people and their skills and their abilities to earn more. These are our economic objectives. The truth is that when you inherent a budget which is in as bad a condition as this one is, and when you inherent high and rising inflation, righting interest rates and real wages going backwards ‑ worse than they have for some decades ‑ then you need to be realistic about how quickly you can turn that around. But you also need to start the work immediately and that's what we've done.
TRIOLI: Petrol prices have skyrocketed again, knocking out really any gains to the consumer from the excise cut. Will you reconsider the expiration of the fuel excise cut in September?
CHALMERS: Petrol prices have spiked again, and they would be 22 cents a litre more expensive were it not for the relief that both of the parties supported out of the last budget. But, again, to be upfront with your listeners, we've said before the election and after the election that it will be hard to continue that petrol price relief indefinitely. Obviously, we play the cards we are dealt, and we will see what the situation is around the time of that October budget. But the legislation says that that petrol price relief comes off in September ‑
TRIOLI: So would you reconsider that?
CHALMERS: We’re unlikely to. We said it’s highly likely to be the case that that support ends in September as the legislation says. But if there are other ways that we can support people through a difficult period obviously we would consider that. But I wouldn't be being upfront with your listeners if I said or if I pretended that that petrol price relief could continue forever.
TRIOLI: So you are prepared to be the new mob who had petrol prices blow up in consumers' faces?
CHALMERS: I think people understand. They are pretty realistic and they know a lot about their own household budgets. They know that when that petrol price relief went in around the time of the last budget of the last government that it was designed in the legislation to end in September. That will be difficult for people; I'm not pretending otherwise. But, equally, I don't want to pretend that some of that short‑term relief in the budget can continue forever. We've got to weigh up all of the considerations and all of the priorities. There's not room in a budget with $1 trillion in debt for even all of the good ideas and so we've got to work out where we can make the most difference.
TRIOLI: You said yesterday inflation is almost out of control. What is in your control in terms of a first and immediate downward pressure on that?
CHALMERS: Well, first of all as we've just been discussing, there's some cost‑of‑living relief, that was delivered in a bipartisan way in the last budget, so that will help for the time being. Our priority is what comes after that. So our policies around cheaper child care, our policies around getting power bills down over the medium term, our policies for cheaper medicine, getting real wages moving beginning with a decent pay rise for minimum wage workers. These are the sorts of things that governments can do. There is an element of pressures imposed on us and the responsibility on Government is to be upfront about where they can change things and have the right policies and plans to do that. That's what the October budget will be about, implementing those commitments.
TRIOLI: Sure, but my question went to an immediate sort of handbrake on that if you can. You mentioned there cheaper child care. Well, that just piles the problem onto the other side of the ledger, doesn't it, in talking about that budget that's out of control and that budget that's already burdened with debt. I mean, it's sort of like handbraking with one hand and accelerating with the other foot.
CHALMERS: I don't quite see it that way. I see where you're coming from, but I don't quite see it that way. I think the most important thing you can do in a budget which is heaving with all of that debt is to take money that might have been thrown around for a political dividend ‑ that's why we are having the audit of rorts and waste in the budget ‑ and see where you can redirect it into more meaningful, more responsible areas of investment in strengthening the economy and making it easier for working families. So child care is a good example of that. If you take the just over $5 billion that we intend to invest in making child care cheaper and more accessible, that is a fraction, for example, of the $5.5 billion that was wasted on submarines that will never be built by the former government. So that's a good example of where we want to take wasteful spending and turn it to more productive purposes ‑
TRIOLI: Sure.
CHALMERS: ‑ that people can benefit from.
TRIOLI: But it's not like you can haul back that $5 billion.
CHALMERS: No, but it's a good example of the different approach. There's other examples too, whether it was the tens of billions wasted on JobKeeper or a $1 billion wasted on Government advertising. There are a whole range of things in the budget which has been defined, unfortunately, for the best part of a decade by waste and rorts. We want to invest people's money more responsibly and get an economic dividend, not just a political dividend.
TRIOLI: On the issue of waste, is there an opportunity ‑ is there some kind of legislative mechanism that you could now introduce to get back some of the access JobKeeper that was paid or is that money just gone?
CHALMERS: I think that horse has bolted, Virginia. We've been pretty clear for some months ‑ we welcomed some businesses that paid back the JobKeeper that they didn't need, but we see that horse as having bolted, something like $20 billion for businesses who didn't need help because their profits were already rising at the same time as some who did need help were unnecessarily excluded. So I think that's a black mark on the former Government, but we don't intend to try to recoup that. We think that horse has bolted.
TRIOLI: Yesterday you describe the economic conditions you've inherited as the trickiest circumstances a new government has ever had to deal with. Are you softening us up for a back‑down from some of your promises when you come in on day one and say, "Oh, look at this they are the worst books ever"?
CHALMERS: No, I'm not doing that. But what I'm intending to do ‑ what I'm committing to doing is to be really up‑front with people, not mincing words about the sorts of economic challenges that we face and the opportunities that are ahead of us as well. So what I've tried to do, not just this week but before that as well, is say we do have high and rising inflation, the Reserve Bank has said there will be more interest rate rises, we do have real wages falling, we do have $1 trillion in debt, we do have a lot of international uncertainty. There are no use mincing words about that. We will only address these challenges if we understand and acknowledge them, and if we work on addressing them together. That's why I hope in my time as Treasurer to be able to explain to people what's going on and to try and enlist the Australian people in this big journey of addressing these challenges but also grabbing the opportunities of cleaner and cheaper energy, and investments in training and people and all of these sorts of things which are ahead of us if we do the right things.
TRIOLI: Well, it's ‑ that's a big part of the challenge ahead of you actually, to boost renewable energy to the levels that you want to see and the level of supply you want to see by 2030, and also the cost of your budgeted electricity network upgrades and the transition to renewable power. Are you starting to estimate, though, what the effect of our current inflation levels are going to be on all of that? Because the costings are ‑ if not obsolete now, then the pressure is on and they are clearly rising.
CHALMERS: Well, first of all I see it as a massive economic opportunity. I'm really optimistic about our country's capacity to grab the opportunities of cleaner and cheaper energy. But it's true that right now we do have energy prices spiking, and whether it's liquid fuels at the bowser or whether it's power prices in our homes and businesses we are actually up for a period of high prices and that makes our approach to climate policy and energy policy more important; not less important. Because as our modelling shows, we can get power bills down over time, we can boost investment, we can create hundreds of thousands of jobs, particularly in the regions which are a real passion of mine if we implement our Powering Australia plan. So this spike in prices that we are seeing right now really is an important prompt to do the right thing on climate change policy. That's what we intend to do.
TRIOLI: Can you guarantee the rebuild won't drive up energy prices though, given the inflationary environment if which that will have to happen?
CHALMERS: Well, no ‑ renewable energy, where you add more renewable energy to the system as you know, and as your listeners know, you get power prices down over time. There is, as I've just said, likely to be a substantial spike in prices around now and that is unrelated obviously to our policy. If you care about lower energy prices you need to boost investment in new sources of cleaner and cheaper energy which is what our Powering Australia plan will do.
TRIOLI: On that, give them what they want or something of what they want?
CHALMERS: No, we intend to put to the Parliament the same policy that we put to the people which was endorsed at the election on Saturday. We understand that there are a range of views in the Parliament about the best way to go about dealing with this challenge and grabbing these opportunities. We will deal with everybody respectfully, but we intend to implement the policy that we got a mandate for or Saturday.
TRIOLI: Jim Chalmers is with you, Federal Treasurer and the Labor MP for Rankin. Labor said it will investigate the arrival of that Sri Lankan asylum seeker boat on the morning of the election that the Liberal Party texted millions of Australians about. Do you know anything of where it is? Does it exist? Are the people on board safe?
CHALMERS: Well, the former Government publicised that I think in quite a political way. I think it was disappointing, frankly, on Saturday in particular to see the way that the Government went about politicising that.
TRIOLI: Sure, but my question goes to what do you know about it so far.
CHALMERS: I understand. We've obviously got some briefings and had some discussions with officials, and if we can say something about the status of that at some point soon we will. But the most important thing for the people‑smugglers to understand is that Operation Sovereign Borders remains in place, that attempted arrivals like that one that was publicised on Saturday will be dealt with the same way under the new Labor Government as it was under our predecessors, and that if people try to come here in that fashion they won't make it to Australia.
TRIOLI: But there are those people on board, and they are safe somewhere right now. You can at least clarify that for us, Jim Chalmers?
CHALMERS: Well, I'm hoping to be able to say something about that before long. There's been some conversations at our end. I'm unable to elaborate on that at this point, but hopefully we can make that clear before long.
TRIOLI: Labor's competency to manage the economy is always the harshest measure by which your party is judged. Will it be your fault or the fault of what you've inherited if you can't get inflation under control if you can't lift wages, if you can't cut debt?
CHALMERS: Well, I don't really see it through that prism. I have always thought that this spin about the Liberals and economic management has been rubbish and I think that their record bears that out. We've been talking about the inheritance that we have received from the Government when it comes to the budget and the economy. So I think a lot of that is kind of self-evident. My most important mission is to be upfront with people about these challenges and to go about responsibly dealing with them as we try and modernise the economy and strengthen it for the future. And if we do that well all of the political considerations will take care of themselves.
TRIOLI: Finally, Jim Chalmers, you mentioned the legacies of Paul Keating and Wayne Swan in your first speech to Parliament. In fact, I think you wrote your thesis on Paul Keating all those years ago. If Paul Keating was the self-described Placido Domingo of the economy, which singer suits you best?
CHALMERS: I'm so reluctant to go down this path. I'm a kid from Logan City, I'm a hip‑hop guy.
(LAUGHTER)
I don't know if it would be helpful. I'm certainly no Placido Domingo. But I say this, Virginia, I've had a wonderful conversation with both Paul Keating and Wayne Swan. They are very, very close friends of mine and as I go about this task I will obviously consult them as I will consult a number of people with experience. But the conversations I had with Paul and Wayne were two of the best I've had since I've had this great honour of being sworn in as Treasurer. I appreciate their friendship, and they are very different to me in lots of ways but very important to me.
TRIOLI: Interesting to hear about the conversations. I hope you won't be a stranger. Jim Chalmers, thanks so much for joining us.
CHALMERS: Thanks for your time, Virginia. All the best.
TRIOLI: The Federal Treasurer and the Labor MP for Rankin, Jim Chalmers.
ENDS
