JIM CHALMERS MP
SHADOW TREASURER
MEMBER FOR RANKIN
E&OE TRANSCRIPT
RADIO INTERVIEW
AUSTRALIA TODAY WITH STEVE PRICE
WEDNESDAY, 2 FEBRUARY 2022
SUBJECTS: Scott Morrison’s grab bag of political patch-ups and panic buying, slush funds and scare campaigns; Unemployment and underemployment; RBA interest rates decision; Record low wages growth and Labor’s plans to help get wages moving; Morrison Government out of touch with the skyrocketing costs of living.
STEVE PRICE, HOST: I listened closely to this speech the Prime Minister made in the National Press Club yesterday. I happened to be in the car and had ABC NewsRadio on so I could concentrate on what he was saying. I thought I misheard this, but I'll read the quote back again to you and then I'll speak with Jim Chalmers the Shadow Treasurer in just a second. Scott Morrison said the Coalition's got a pedigree in growing the economy - you expect him to say that - and keeping Australians safe. But he said, quote, "this election is a choice, and this choice isn't about a referendum style choice, a yes and no on the Government." Well, yes it is. That's what every election is, isn't it? You're choosing whether you want to keep the government or not. Of course it's a yes / no choice. Jim Chalmers joins me on the line, could you make any sense of that?
JIM CHALMERS, SHADOW TREASURER: Like the rest of the speech and like the rest of the question and answer session, I think he was so busily trying to avoid responsibility for all of the stuff-ups of the last little while that he got himself all tangled up. Every election is both of those things. It's a referendum on the Government - whether it's done a good job in ordering rapid antigen tests, whether they've got enough to show for the trillion dollars in debt, all of those sorts of things. It's also a choice too on who's got a plan for the future, and we didn't hear that yesterday from the Prime Minister. A big opportunity at the Press Club to talk about the future of this country and what he's going to actually do, but there's nothing different after the speech then before the speech. A lot of evading responsibility, but not much of a plan for a better future.
PRICE: Do you give them a tick for the unemployment rate, that's important we want to see Australians in jobs. He said that they believe they can achieve an unemployment rate with a three in front of it, that's a good achievement surely?
CHALMERS: Clearly, we want the unemployment rate to be as low as possible, but it doesn't tell the full story of the labour market. One of the things that the Reserve Bank Governor's been talking about - and will probably talk about today - is the fact that even with unemployment heading down – and we welcome that - wages aren't really growing in any sustainable way so that people can keep up with these skyrocketing costs of living. The labour market is partly the unemployment rate, that matters, but it's not the whole story. There's issues around job insecurity, wages growth, all of those sorts of things, which are important too. We need to remember that.
PRICE: Is it possible when you look at that unemployment rate to work out, are the numbers being bolstered by workers who have not got full-time employment?
CHALMERS: There's two things about that. First of all, it's an unusual time because it's not a normal labour market with all the internal borders closed until recently and the international border has been more or less cut off too. So it's an usual period. The other thing - and a lot of your listeners would know this, a lot of people raise it with me on social media and the like - is those numbers catch people who might be working zero hours or a couple of hours but are technically still employed. It's good to have a low unemployment rate, we want to see that number as low as possible, but we need a bit of perspective here. It doesn't tell the full story, it's not a perfectly accurate measure, but we want it to be as low as possible, that's clear.
PRICE: Say you win the election and you're the Treasurer. One of the things that Australians have had to battle through over the last five years - maybe even longer - is lack of wage growth. People don't get pay rises anymore. I think that'll change slightly with the competition now on for staff and work. I mean, workers will be attracted to an employer who can pay them a bit more. But how do you properly, without COVID, stimulate wage growth?
CHALMERS: I think this is the kind of defining feature of the economy, not just the last couple of years but for much of the last decade, we've had historically low wages growth. At the moment, because of the way that costs of living are rising, real wages are actually going backwards in the Government's Budget this year. I think that is the big problem. That's the reason why people who are even working as hard as they can they can't quite get ahead, it's because of that stagnant wages growth. So there's two things going on there. Yes, people say we want wages growth to pick up as the unemployment rate falls - we hope that happens too - but it's been very stubborn and we don't know that it will. There's two things that matter here. There's the overarching issue, the state of the labour market. Then, more specifically, when it comes to job security, one of the reasons why we haven't had that wages growth is because we've had things like labour hire undercutting people who are doing the same work. We've had some issues in industrial relations. We've got things like the gig economy, which is an opportunity for a lot of people but also has its downsides because of the insecurity of that work. That's what's been eating away at the foundations of wages growth. We've had a policy out there since last year, one of the first policies that we put out there in much detail, which is about trying to deal with some of those issues - labour hire, gig economy, getting Fair Work Australia focused on turning casual insecure jobs into more permanent jobs. Those are some of the ways that you get wages growth going again.
PRICE: You could win an election and then get an interest rate rise, you know, just about as you take office. The RBA left the cash rate where it was yesterday. We haven't had a cash rate rise, incredibly - I couldn't believe it when I saw this number - for ten years or more. Do interest rates need to go up?
CHALMERS: I wouldn't necessarily put it that way, Steve. What we try and do, both sides of politics, is not kind of give free advice to the Reserve Bank or pre-empt it's decisions. I think that's important, because the Reserve Bank's independent, they've got a good Board...
PRICE: Yeah, I know.
CHALMERS:...but I think almost every economist understands that interest rates won't stay at zero or near zero forever, no matter who wins the election. At some point interest rates will go up. I think the indications the Reserve Bank Governor gave yesterday after the Board met - and he's giving a big speech at the Press Club today - is that they appear to be in no rush to raise interest rates. They are worried about those wages issues that we were just talking about. The indications that they are giving is that obviously rates will need to go up at some point, they can't be at zero forever under a government of either political persuasion, but they don't seem to be in a hurry.
PRICE: How much does a loaf of bread cost?
CHALMERS: I think it's about $3.50, but it's different depending whether you grab the fancy stuff or the Tip Top stuff! I've got a great bakery near me where they put it up for usually about $3, but most people pay about $3.50 I think.
PRICE: It was a gotcha question, but it's a reasonable one to pose. When you get to the office of Prime Minister, clearly you're not out doing the shopping and you're probably not ever putting petrol in the car because you got a limousine to drive around, but I don't know that it did Morrison too much damage to be honest.
CHALMERS: I think it may have. I take your point, but when the Prime Minister has been so keen to run a scare campaign on the cost of living, the least he could do is work out how much it costs to live. I think most people are relatively forgiving about the answers to those kinds of questions, except when the Government's made this big deal out of trying out a big scare campaign about the costs of living under Labor. You'd think he would at least try and understand what it costs to live before he did that.
PRICE: You guys might take a leaf out of John Howard's book, apparently he used to carry around a copy of the prices of those sorts of items just in case he got that question.
CHALMERS: I was thinking about that yesterday, Steve. Someone said to him what's the interest rate right now - they were running an interest rate scare campaign - and they said to him what's the interest rate and he didn't know. So they must've left that off his little laminated list in his pocket.
(LAUGHTER)
PRICE: That's the way it goes, these things can bite you for sure. Thanks for talking to us, always a pleasure, catch up soon.
CHALMERS: Appreciate it Steve, all the best and have a great day.
PRICE: Jim Chalmers there, the Shadow Treasurer.
ENDS
