E&OE TRANSCRIPT
RADIO INTERVIEW
ABC SYDNEY
TUESDAY, 6 OCTOBER 2020
 
SUBJECT: 2020 Federal Budget.
 
LINDA MOTTRAM, HOST: Jim Chalmers, good evening and welcome.
 
JIM CHALMERS, SHADOW TREASURER: Thanks for having me on your show, Linda.
 
MOTTRAM: Given all the uncertainty, do you welcome the Government spending big like this across such a broad range of areas with jobs at the centre?
 
CHALMERS: Well clearly the circumstances warrant a lot of government support. That's been obvious for some time. Our issue is what we actually have to show for this trillion dollars in debt. They've racked up a trillion dollars in debt, but they're still expecting unemployment to be too high for too long, there's no real vision or plan for the future, and it still leaves too many people behind. Just take one example, think about the hiring subsidy, the wage subsidy that they've announced tonight, 928,000 people on unemployment benefits are not eligible for the hiring subsidy. That just goes to the missed opportunity of racking up a trillion dollars in debt and still leaving all of those people behind.
 
MOTTRAM: But still, on the Government's numbers, GDP is going to be 4 percent, 4.5 per cent higher than it would have been without these measures. Unemployment will be five per cent lower than it would have been. There's a lot of uncertainty here. This is a better result than we would have got otherwise.
 
CHALMERS: There is uncertainty.  The Government hasn't been exactly bang on when it comes to predicting what's going to happen in the economy. But let's talk about unemployment. They have racked up a trillion dollars and at the end of the forward estimates unemployment is still higher than what it was before COVID-19. The point that we are making, and our concern with the budget, there are some elements that we will support, but our concern is having racked up a trillion dollars in debt unemployment will still be too high for too long. It doesn't say enough about the future or build a lasting legacy from all of this debt. It doesn't undo all the damage of the last seven years. They've managed to spend a trillion dollars still without doing anything about child care or anything meaningful about public housing or anything meaningful about cleaner and cheaper energy. The list goes on and on. So it is a missed opportunity. We do acknowledge that the COVID crisis is having an impact on the economy and the budget. There's a responsibility for the Government to respond. But we need to get maximum bang for buck for all of these hundreds and hundreds of billions of dollars in new borrowings, we need to make sure that that's effective
 
MOTTRAM: You're saying there are those who have missed out but surely there has to be a limit to the eye watering debt, especially given that next year the pandemic might come back and bite us all over again.
 
CHALMERS: Of course, Linda. But it comes down to how you design these programs. For example, obviously it makes sense to have some kind of hiring incentive for workers, but what they've done with the cut off has meant that if you're over 35 years old there's nothing in terms of JobKeeper as that trails away. JobSeeker for the time being is going back to $40 a day, and for 928,000 people on that unemployment benefit they can't access these hiring subsidies. So there is an issue here with priorities. There is an issue here with the balance of what they've announced. Some of it we will support but there's an issue there when you can rack up so much debt and don’t get enough bang for buck.
 
MOTTRAM: Now Josh Frydenberg says he will introduce legislation tomorrow for the accelerated income tax and the temporary business investment incentives and the parliament needs to indicate it will support it straightaway so the ATO can get to work on it. Will Labor support it with that haste?
 
CHALMERS: I think that's a typical kind of political approach, looking for a political outcome rather than economic outcome. We've already indicated that we will be supporting the changes to the income tax cuts timeframe. We support tax relief for people on low and middle incomes. We've said that repeatedly. We've called for some of those tax cuts to be brought forward so the ATO can take their guidance from that. When it comes to some of the other measures, we're inclined to support the business tax measures as well but we've only seen them since 3:30pm this afternoon. It's a bit rich for him to be making those sorts of demands. We're inclined to support them. But one measure alone cost $27 billion in the forward estimates and so I think it's only responsible for us to say that we're inclined to support it, we see what they're trying to achieve, but we will work through the detail and make sure that spending that much money in this initiative is responsible, and will get that maximum bang for buck that we're looking for.
 
MOTTRAM: The Coalition is relying heavily on assisting the private sector to reboot the economy. Is that the right approach?
 
CHALMERS: Well obviously the private sector is the key job-generating, job-creating, wealth-creating part of our economy. Nobody contests that. There's an important role for the public sector too, but overwhelmingly the workforce in Australia is a private sector workforce. A lot of people have lost their job during the course of this crisis. The private sector economy was actually quite weak coming into this crisis and that left us vulnerable. So there's a lot of work to do there. We've had a business investment problem for some time even before this year. We have had an issue with business having the confidence to invest because there's been energy policy uncertainty and in other areas too. We need to address that. We need to get the private sector purring again because that's how we create jobs.
 
MOTTRAM: Okay, Jim Chalmers thanks very much for your time this evening.
 
CHALMERS: Thanks again, Linda.
 
ENDS