Interview with Anna Henderson, SBS World News

JANICE PETERSEN:

Returning to our coverage of the Federal Budget now, and the Treasurer says that increasing migration will be central to the nation's economic success. But Jim Chalmers has also warned that global conditions could trigger a rise in unemployment. He sat down with our Chief Political Correspondent, Anna Henderson.

ANNA HENDERSON:

Treasurer, thanks for reaching our SBS News audience. We're coming off record lows, but we are now looking at a projection of unemployment increasing ‑ 150,000 potentially jobs to go. What do you say to those people who potentially voted for you, who might now be in a situation where they don't have a job to go to?

JIM CHALMERS:

I think people broadly understand that the economy will slow, and unemployment will tick up a bit, still lower than what it was before the pandemic, but it will tick up a bit in Treasury's estimation, because of that combination of a big global slowdown which most people are predicting has implications for our economy. Interest rates rising as they have been, will bite at some point and that will have implications for growth in the economy and for the jobs market as well. And the natural disasters aren't helping either. All of these things are combining to slow our economy a bit. I'm still very optimistic about the future of the economy and the future of the country, but we do have some economic difficulties to navigate together in the near term.

HENDERSON:

Given we have these labour force shortages at the moment why isn't your Government putting more focus on immigration as a solution here, because wouldn't that actually drive down inflation?

CHALMERS:

I think it's an important piece of the puzzle. We see migration as a very important part of our economic policy. It's not a substitute for training more people for more opportunities here as well. It should be complementary and not at odds, and that's how we see it.

HENDERSON:

Are you worried about what's on the horizon with China's economy and how that could impact on Australia?

CHALMERS:

Yeah, the slowdown in China is an influence on our budget. It's one of the key reasons why our Treasury has downgraded their forecasts for the global economy and for our own economy. And you'll see that in the forecasts, in the Budget.

HENDERSON:

You still have time in your term of Government to ditch the stage three tax cuts. If the economic picture does get bleaker, will that be on the table?

CHALMERS:

What we've tried to do is to start a broader conversation about the sustainability of the budget and that's been a focus of that. I understand that and I appreciate that, but really much more broadly than that, what we need to do is work out how are we going to fund these big, persistent structural pressures on the budget. The fastest growing area of spending is actually the interest bill on the trillion dollars of debt we've inherited. But beyond that, aged care, health care, NDIS and defence, these are all areas we want to invest in, and we want to get a good bang for buck in. In order to do that, we've got to make sure the budget is sustainable more broadly, and that's the conversation that I'm keenest to have.

HENDERSON:

But my question is about the first term. So, it sounds like you're not prepared to rule out that if economic conditions change, that stage three tax cuts could be reversed.

CHALMERS:

I'm just saying it hasn't been a focus for us, and I'm not trying to send some kind of signal about that to your viewers. I'm just being up‑front with them and levelling with them that we've got big pressures on the budget. The best way we can deal with that in the near term is in the ways that I've described in this Budget on Tuesday night, which will be solid and sensible and suited to the times. And central to that are the priorities and policies that I've outlined.

HENDERSON:

Treasurer, thank you so much for joining SBS.

CHALMERS:

Thanks for having me back.