JIM CHALMERS MP
SHADOW TREASURER
MEMBER FOR RANKIN
E&OE TRANSCRIPT
RADIO INTERVIEW
AUSTRALIA TODAY WITH STEVE PRICE
WEDNESDAY, 12 MAY 2021
SUBJECTS: Budget 2021
STEVE PRICE, HOST: Labor's Treasury spokesman Jim Chalmers is on the line, good to talk to you.
JIM CHALMERS, SHADOW TREASURER: Thanks for having me on the show, Steve.
PRICE: Is this an election budget, you reckon it?
CHALMERS: It is certainly a Budget which is all about the politics of the next six or twelve months certainly designed to get them through the election and not a lot of long term vision beyond that.
PRICE: What do you give them out of 10 on this?
CHALMERS: There's some things we liked, so a four or five. Obviously, we welcome more investment in mental health. Obviously, there's some issues around women's super that we are supportive of, but I think overall, a bit of a missed opportunity. They spent $100 billion of taxpayer money last night, all of it borrowed. Racked up a trillion dollars in debt. And I don't think they've got enough to show for it, even after all that spending. They're still expecting real wages to actually go backwards at the end of the Budget period. So I think that's a bit of a demonstration that they're not getting enough from paying all that borrowed money.
PRICE: I'm pleased to raise wages, but I like to distil these things down to what it means to average working people listening to us on the way to work today. We've had no wages growth really, I would say, over at least five years, maybe longer. And you don't sit and watch that economic statement last night thinking that people on a normal salary, working for a company that survived COVID, can look forward to anytime soon a wage increase?
CHALMERS: That's spot on, on both fronts. I think the defining failure of the Government's economic mismanagement for the last eight years has been stagnant wages. In the Budget there’s no joy for people who are hanging out for a pay rise. Real wages go backwards, as I said a moment ago. I think what's particularly galling for all those listeners who are driving to work and listening to you this morning, is that people did the right thing by each other. They limited the spread of the virus. That's why the economy is recovering. What the Budget said to them last night, is you're not going to get a slice of the action when it comes to this recovery. It's not a real recovery if people don't benefit from in terms of their wages.
PRICE: So if you're in that chair, how would you be this morning, explain to Australians off the back of COVID, and an economy that staggered to a halt and is now sort of firing back up. How would you explain to them that Labor would increase their pay-packet?
CHALMERS: Well, there's two parts to it. First of all, everyone wants to get unemployment down, but we also need to get underemployment down. A lot of your listeners would want to be working more hours, they can't get the hours they need to support their loved ones. So we have a big focus on underemployment not just unemployment because that's part of the reason why wages are stagnant, people's work is insecure and precarious. So we've had a few things to say about casualisation. That's part of the story, but also making sure that people can actually grab the opportunities of a recovering economy. Doing something meaningful on childcare, and skills and training, and doing something meaningful in the industrial relations system. When we get to the election the Government will be asking for 12 years and it will be more of the same wage stagnation because they don't actually understand how tough people are doing it on those stagnant wages.
PRICE: The Government has come back and said well, we've introduced tax cuts for low and middle income workers, we're ploughing billions of dollars into infrastructure which we believe will create jobs. They would say that, that's their answer to getting more people employed, and people to have more money in their pocket.
CHALMERS: I'm glad you raised those two things, Steve. The thing to understand about the tax cuts for lower middle income earners is that they run out after the election. So that is literally a plan to get people through to the other side of the election, when those tax cuts run out. The tax cuts for ordinary working people are temporary, but the tax cuts for the highest income earners are permanent, so people need to understand that. On infrastructure, obviously we want to see infrastructure built. We want to have a lasting benefit from all this debt that the Government is racking up. But what they didn't tell you last night is that there's something like a $3.3 billion cut to infrastructure over the next four years, which is remarkable in a Budget where all this money is spraying around. After getting the front page of the paper saying what a bonanza it was going to be for infrastructure, there's actually a cut in there. And that's another example of the gap between what this Government announces and what they actually deliver.
PRICE: Would you as a Government be trying to get the borders open quicker?
CHALMERS: We would be trying to get the vaccinations done quicker and that's really the key determinant of whether the borders can open. In the Budget last night there were some weasel words about when the vaccinations would be rolled out and what that means for the reopening of the economy. We think that that debacle around the vaccine rollout is costly for the economy. The Budget had an opportunity to spell out those costs and consequences last night and the Government didn't take it.
PRICE: Have your people been able to work out, because I can't, Jim, whether hidden away in the budget there's some money to build federally controlled and constructed quarantine facilities outside the big cities? Because I can't find it.
CHALMERS: No, I think it was crickets on quarantine. I'm happy to stand corrected if somebody can find it, but I’m a bit like you, Steve. We were very surprised and disappointed. They had all these glossy marketing brochures about getting people through COVID which didn't seem to mention quarantine. That's one of the big holes in the government's mismanagement of the health aspects of this crisis. So I think people were expecting to see something about quarantine. If it's in there, nobody has found it yet. And that's another example of a bit of a missed opportunity in the Budget to get this right.
PRICE: There's $480.7 million to expand the Howard Springs facility but that's on the table already in front of the Government. From the Victorian State Government, the Mickleham facility that they want to build. And the Wagner airport facility that Ananastasia Palaszczuk supports in Queensland and there's no money for either?
CHALMERS: Yeah, that's my understanding too, Steve. I think the reason for that is because the Prime Minister doesn't want to take responsibility for quarantine. It's one of the things that's gone bad. That and the vaccine rollout. Both of those are Scott Morrison's responsibility. They've both gone badly. And so he's trying not to take responsibility for those mistakes. What that means in the Budget is the Government hasn't really ponied up for a quarantine. I think the listeners would understand that quarantine is a big part of the story here, particularly when we're dealing with a delayed vaccine rollout, which means we will have some of these issues for longer than is ideal. And so quarantine needs to be fixed. And we don't think it was fixed in the Budget.
PRICE: Just finally, I know you're very busy. You're very clever on the macro, when you look at the numbers, when you look at the debt, and you consider that Josh Frydenberg three budgets ago said we would be back in the black. We now have a deficit predicted this financial year of $106.6 billion. And we're going to end up with a debt of about $920 odd billion dollars by 2023-24. Those figures are eyewatering, but would you as Treasurer be comfortable with that level of deficit and debt, given what we've been through in the last 12 months?
CHALMERS: I think, only if we're getting genuine, valid, value for money from it. One of the reasons why I don't think the Government's been getting as much bang for buck from all of that borrowed money is because they've got all these slush funds in the Budget. Unfortunately, when you look at the Budget last night, I think we counted something like 21 different slush funds which are all about spraying billions of dollars around to get the Government through an election. We've seen this movie before with sports rorts, and dodgy land deals, and all the rest of it. So I think Australians have got a right to be very wary and very suspicious of a Government that has wasted so much money. Some money has been spent for good purposes, but a lot has been wasted as well. And there's no sign that the Government has learned from all those rorts and all that waste. I think we can expect to see more of the same. So there's two different questions there. The level of debt that matters, but what really matters is whether or not you've got anything to show for it. And the Government doesn't have enough to show for that trillion dollars in debt.
PRICE: Finally Jim, unemployment staying at five per cent, and indeed predictions for it to go to four and a half, is that optimistic?
CHALMERS: Well, it remains to be seen. I think the country is capable of an unemployment rate lower than 5 per cent. We need to get there, but as I said before, that's part of the story and underemployment should be part of the story as well. The unemployment rate doesn't capture the full story of the jobs market. We need to deal with underemployment, stagnant wages, job insecurity, all of these issues together if we're to see that wages growth that's been missing for the last eight years, that Australians need and deserve so they can get ahead in the recovery and actually get a piece of this economic recovery.
PRICE: Thanks a lot for your time and enjoy Question Time!
CHALMERS: Thank you, Steve.
ENDS
