E&OE TRANSCRIPT
TELEVISION INTERVIEW
ABC THE BUSINESS
TUESDAY, 2 APRIL 2019
 
SUBJECT/S: 2019-20 Budget
 
ELYSSE MORGAN: While the Government says it's way ahead of Labor as the better economic manager, the polls have consistently put the Opposition out in front for the looming May election. Joining me now is Shadow Finance Minister Jim Chalmers. Welcome to the program. 
 
JIM CHALMERS, SHADOW FINANCE MINISTER: Thanks Elysse.
 
MORGAN: What do you think of the Finance Minister, Mathias Cormann's assertions about the strength of the surplus ahead?
 
CHALMERS: Well, a couple of things about it. He did admit at last that it's only a forecast or a projected surplus. If the Government were to change hands in May - and I'm not necessarily saying it will - but if it were to change hands in May, the new Government would inherit a Budget in deficit. Nothing has been delivered tonight, Only forecast and projected. Mathias Cormann did 'fess that up today. Josh Frydenberg hasn't done that so far. It's a projected surplus. It's built on a couple of things which concern us. It is built, as you mentioned, on a big underspend in the National Disability Insurance Scheme. That fundamentally means that a big part of the projected surplus comes from making people with a disability wait longer for the services they were promised. That is a concern. It is also based on the usual heroic assumptions about wages growth which haven't eventuated over the last handful of budgets. The Government is notorious for overestimating wages growth. Wages growth, as you know, has been stagnant. That $7.1 billion projected or forecast surplus for 2019-20, we won't know if it's a surplus until September 2020. And there are aspects of it that concern us.
 
MORGAN: In some ways though, when you look at it this could actually be a good Labor Budget. What would you give it out of 10? 

CHALMERS: Look, I'd give it a three. I've heard other commentators say they've copied some of our measures. I think it's less about a copy of Labor and more of a con. It's a con because... 
 
MORGAN: They've picked up your tax concessions to households. They've doubled what they were offering. I mean, that's basically carbon copy of what you're offering?
CHALMERS: Yep, in that aspect they've played some catch-up on tax cuts for low- and middle-income earners. They've still left people earning up to $40,000 short. We're going to look to see what we can do to improve the situation for two million low-income earners who the Government have left behind tonight in the Budget. Fundamentally, they have played catch-up on tax but they've also locked in big cuts to schools, big cuts to TAFE, hospitals, right across the board. They had an opportunity to change course and instead we got fundamentally more of the same.
 
MORGAN: The Government says your tax take will be $200 billion higher than theirs. This sets up a high-taxing, high-spending ALP potential Government against a low-taxing, conservative-spending Coalition?
 
CHALMERS: Not so fast, Elysse.
 
MORGAN: Going into an election, that's going to be the argument.
 
CHALMERS: A couple of things about that. Where to begin? The Government this year is collecting more tax than in any year, any full year of the former Labor Government. They always say they are low taxing but tax-to-GDP has been consistently higher under Morrison, Abbott, Turnbull and under Howard and Costello than under Labor. That's just the first point.
 
MORGAN: That's also a factor of economic growth and the fact we've had a huge boom in minerals, exports and that's increased the tax take, profits have increased tax take?
 
CHALMERS: The reason I'm picking up on it, Elysse, is because the Treasurer was in the House of Representatives just before saying taxes will always be lower under the Coalition than under Labor, except that they're not. That's just a factual point. On our proposed tax changes, we have been up-front about those. We've had them out in some cases for a number of years. We've made it very clear, we intend to close down some of those tax loopholes which are eating the Budget from within. We have other priorities - we want to invest in schools, hospitals and TAFEs. We've been upfront about those priorities all along. So I think the contest will be between six years of cuts and chaos and division and dysfunction and favouring the top end of town, versus Labor which wants to genuinely prioritise people on middle and low incomes, invest in their schools and hospitals and TAFEs and universities. That's how we get the place growing again in a sustainable way.
 
MORGAN: Let's switch to the economy. The Government today has said that we are heading into tougher times economically. Do you think we're heading for a recession? 
 
CHALMERS: No. I wouldn't use that language. The Government has been caught out I think using irresponsible language, politicising the economic conditions. I would point out three facts about the Budget tonight. These are the Government's own figures in their own Budget. The Government downgraded economic growth. They downgraded wages growth. They downgraded consumption. As you know, 60 per cent of the economy is consumption. So if this is such a fantastic plan for growth in the economy and for jobs, why are they downgrading their own numbers? What that tells me is after six years of cuts and chaos and division and dysfunction, we've got this failing Government with a floundering economy. This is supposed to be their big piece de resistance leading into an election campaign. Commentators said they will base their re-election on this Budget. Well the Budget's about slowing growth, downgraded wages and downgraded consumption. And that won't cut it.
MORGAN: Very quickly because we're almost out of time, but there's a lot that need to go right for Australia in order to reach the surpluses that have been forecast. What do you think is the most likely thing to go wrong?
 
CHALMERS: We have to be careful about global conditions, obviously. We need to keep an eye on, for example, the negotiations between the Americans and the Chinese. We need to be careful about that wages forecast. There's a whole bunch of things that are buttressing that projected surplus, which could go the other way. We're very conscious of that. That's why we'll take to the election a more responsible approach to the Budget than our opponents.
 
MORGAN: Jim Chalmers, thank you so much for your time. 
 
CHALMERS: Thank you Elysse.
 
ENDS