JIM CHALMERS MP
SHADOW TREASURER
MEMBER FOR RANKIN

E&OE TRANSCRIPT
NATIONAL PRESS CLUB TREASURERS DEBATE

WEDNESDAY, 4 MAY 2022

 

SUBJECTS: Federal Budget; Federal election.

LAURA TINGLE, MODERATOR: Good afternoon ladies and gentlemen, and welcome to the National Press Club in Canberra and the Westpac address. My name is Laura Tingle, I'm the Club's President. Today we are hosting the two men who hope to be the country's Treasurer after the election on May 21, and giving them a platform to debate their respective policy economic positions. The guidelines of the debate have been agreed and are fully set out on the Club's website, but here are the main points. Each speaker has been allocated six minutes for opening remarks. After that, we will have questions from the working media. The questions should be posed as one question for both speakers or one question to one of the speakers. Separate questions to the two speakers will be disallowed and dealt with very firmly, and only the first question will be allowed to be dealt with. This will be firmly enforced, as I remind my colleagues, as we have a very tight time schedule. There'll be a maximum of two minutes to reply to questions and if the question has been put to just one speaker, the other speaker will have the option of rebutting for one minute. However, I will endeavor to try to keep this a free-ranging conversation where we can. I also have the capacity to ask my own questions and also to invite both speakers to address a question to each other. Finally, I'd like to say the Press Club – as a platform for national debates - has invited the major parties to take part in debates on health, foreign policy, aged care, women and climate change. We have not been able to get the parties to agree on those debates. A toss of the coin has decided that Jim Chalmers will speak first, and I'd ask you to welcome him to the lectern.

JIM CHALMERS, SHADOW TREASURER: Thanks very much, Laura. Thanks, Josh. Thanks to the Press Club and to everyone who's joining us here and around Australia. Australia, this election is your opportunity to cast your verdict on a wasted decade of missed opportunities. But it's also a choice. A choice between a stronger economy and a better future under Labor, powered by cleaner and cheaper energy, and responsible investments in skills and industries, and more opportunities for more of our people, and another three years of dysfunction, and drift, and waste, and rorts, and mistakes, and buck-passing, which have made it that much harder for Australians to get ahead. The defining issue of this election is the full-blown cost of living crisis which has emerged on the Morrison Government's watch, and it didn't just show up when Russia invaded Ukraine. It showed up when the Coalition the best part of a decade ago started attacking the wages and job security of Australian workers. Neither a war in Europe in 2022, nor even a pandemic explains or excuses what has been almost a decade now of economic mismanagement. Last Wednesday, Australians got confirmation of something that they already knew - that costs of living are out of control, that wages are nowhere near keeping up with inflation - and then a rate rise yesterday just added to the pain that so many are feeling and there's more rate rises to come. No wonder consumer confidence is absolutely plummeting. This is the thanks that Australians get for the sacrifices that they've made for each other to get through this pandemic. A country which rose to the occasion and a Government which fell back into old habits.

From this lectern, not that long ago, my opponent - who I respect - said that his hero throughout the pandemic is Margaret Thatcher. Margaret Thatcher of course said that there is no such thing as society. Hello, I couldn't disagree more. My heroes are the essential workers and the shift-workers who did so much to keep the wheels of the Australian national economy turning throughout the course of this pandemic, and the reward for their efforts can't be another three years of working hard but still going backwards in this economy. Three more years of finding it harder and harder to get ahead and provide for their loved ones. Three more years of being absolutely punished by this triple whammy of skyrocketing inflation, falling real wages, and now interest rate rises as well. Now, Josh, the job that we both seek is supposed to be about real people in real communities around Australia. And our first, our second, our final obligation, is to them - to each other as Australians - and I don't think that this Government gets that. I don't think that they understand that primary, singular responsibility we have in managing the economy is to provide a better future for more people by providing them with more opportunities. Now, the Government wants to talk about economic management. It's not good economic management if ordinary people who work hard can't get ahead, if they can't provide for their loved ones, if they can't make ends meet in our economy. It's not good economic management if you have almost nothing to show for almost a trillion dollars in debt, half of which was racked-up even before the pandemic. After almost ten years now in office, the Liberal and National legacy in the economy is weak growth after the pandemic, and rising inflation, falling real wages, flatlining productivity, weak business investment and the Budget which is absolutely heaving with rorts, and waste, and Liberal debt.

They have absolutely no idea of the pain that that inflicts on ordinary Australians, and they have no plan to deal with it. If they do, that plan isn't working. We are the only party, Labor is the only party, taking these challenges seriously. Our Economic Plan is all about growing the economy without adding unnecessarily to the inflationary pressures. It's about genuinely relieving cost of living pressures on families over the longer-term. It's about getting real wages moving again. And it's about having something to show in economic terms for the trillion dollars of debt that we will inherit from Josh. What we're proposing is responsible and meaningful change, not radical change. We know that we can't undo all of the damage done over almost a decade in one Budget, or indeed even in one term. Australians are asking for better than this. Their Government, at the same time, just promises them more of the same. But more of the same Government means more of the same punishing combination of skyrocketing costs of living and falling real wages from a Government that takes credit for the good things but none of the responsibility for the difficult things, and a Prime Minister who has excuses for everything but plans for nothing. You can't pay your mortgage or feed your kids with the excuses that we get from this Government. So Australians have had enough of the excuse making, and the buck-passing, the overpromising and underdelivering. What we commit to is putting people at the centre of our vision for the economy , and to put a stronger economy at the centre of our vision for a better future. I'm looking forward to expanding on that through the course of this debate and beyond.

TINGLE: Thanks, Jim Chalmers. Treasurer.

JOSH FRYDENBERG, TREASURER: Well, thank you Jim. Thank you, Laura. Three years ago to this very day, I stood before this lectern in this room ahead of the 2019 election. Little did I know, little did we know, what Australia was going to go through over the next three years. We saw the biggest economic shock since the Great Depression. The first global pandemic in more than a century. 1.4 million Australians either lost their jobs or saw their working hours reduced to zero. Treasury came to me and said, Treasurer the unemployment rate in Australia could reach as high as 15%. That would be more than two million people unemployed. The size of the global economic shock during COVID was more than 30 times that experienced during the GFC. And I'm proud and pleased to stand before you today and say the unemployment rate is not 15%, the unemployment rate is not 5.7% as it was under Labor, but the unemployment rate today is it's equal lowest in 48 years at just 4%. In fact, it was Jim who said the single biggest test for the Morrison Government's management of this recession would be what happens to unemployment and jobs. And female unemployment today is at its lowest level since 1974. There are around 2 million more Australians in work today than under the Labor Party. Youth unemployment, underemployment, female unemployment, headline unemployment, all lower today than under the Labor Party. Now, if you think that is luck, you are wrong. It's an economic plan that is working. JobKeeper saved more than 700,000 jobs. HomeBuilder put more than 100,000 people into their own home. Our tax relief provided support for more than 11 million workers and three and a half million small businesses, and we are one of nine countries in the world to maintain a Triple A credit rating from the three leading credit rating agencies. And just last month, the International Monetary Fund upgraded Australia's economic growth forecast while it downgraded the rest of the world. Now, this is our record and we will campaign on our record. But it's also about the future, our future economic plan for the country. A plan that I laid out in a Budget just a matter of weeks ago. A plan that delivers cost of living relief now, halving the fuel excise, ensuring that the Low and Middle Income Tax Offset has been lifted by $420, seeing 6 million pensioners, veterans, others on income support, carers, get $250 cheques in the mail, and also ensuring that our medicines are more affordable for more than 2.4 million Australians. We laid out a long term plan to create more jobs by backing our regions as the new frontiers of economic growth, by backing small business with increased tax deductions, by investing more in manufacturing so that we can have supply chains that are resilient, and ensuring that Australia moves to net zero emissions by 2050 with a fully-funded and costed plan. That is what we set out in the Budget, while guaranteeing the essential services that Australians rely on with record spending in health, in education, in disability support, in mental health, and also for women's safety. And we're investing more in national security and defence after the Labor Party recklessly saw defence spending on their watch go down to its lowest level since 1938 as a percentage of GDP. And we're living in a more unstable environment and we need to invest more in national security and defence. So that's our plan. And that's our record. Now, the Australian people will go to the ballot box in just a few weeks’ time. They will face a very clear choice between a Coalition that has delivered more jobs, and lowered the unemployment rate, and a Labor Party which, when they came to government, the unemployment rate was 4.4%, and when they left government the unemployment rate was 5.7%. Between a Coalition that has delivered lower taxes - $40 billion alone since the start of the pandemic - and a Labor Party when they were last in government increased taxes by $120 billion and took to the last election $387 billion of high taxes, and a Coalition that has steered the economy through the biggest economic shock since the Great Depression, leading the world with our recovery and a Labor Party that got the big calls wrong - like on JobKeeper, when Anthony Albanese said the economic roof would come crashing down when that was ended, and they wanted the COVID disaster payment to keep going, and they wanted to splash $6 billion of taxpayers money on people to get the jab when they already had the jab. You see, the Coalition has delivered lower unemployment, lower taxes and a strong economic recovery, and we have the plan to take Australia forward. Whereas the Labor Party has no plan other than their 13 page brochure, which means more public servants, another review, and Bill Shorten’s old multinational tax agenda. This is the choice. The Coalition and the Prime Minister, Scott Morrison, who's delivered a Budget, who's held a Treasury portfolio, and Anthony Albanese who's never delivered a Budget, never held a Treasury portfolio, doesn't know what the cash rate is, doesn't know the unemployment rate. That's the clear choice for 26 million Australians.

TINGLE: Thank you, gentlemen. Let's take a stocktake of what one of you will face after the election on May 21. We've got a Budget with unprecedented debt and deficits. And in the Budget that you handed down Treasurer, there was over $70 billion of new spending, no savings, and you're basically relying on the economy growing to improve the bottom line. It's now pumping more money into the economy as we speak and there are more election promises to come. That stimulus is now working against interest rates and monetary policy - which were raised yesterday of course - and with the Governor indicating we've got at least a year of rate hikes to deal with inflation. Further, the outlook for Australians, based on what the Reserve Bank had to say yesterday, was for further cuts in real wages in the next three years. So my question to both of you is, the arms of economic policy seem wildly out of sync now. What are you going to do about it?

FRYDENBERG: I'm happy to go first. You raise debt levels, which of course are higher as they are around the rest of the world given the size of the shock that we have faced, but what we saw in the budget was a material improvement to the bottom line by more than $100 billion, the fastest fiscal consolidation in more than 70 years in Australia. We're seeing deficits that more than halve over the forward estimates and then more than halve again over the medium term. We're seeing debt as a proportion of the size of the economy peak four years earlier and more than five percentage points lower than what was previously forecast. And we've done so off the back of conservative commodity price assumptions, unlike the Labour Party when they were last in government, who baked in iron ore prices $180 a tonne, I've got it in the budget is $55 a tonne, even though you're selling it today at $130 a tonne. I've got thermal coal in the budget at $60 a tonne even though today it's $360 a tonne. And same with metallurgical coal, I've got it in the budget at $130, even though it's selling for $510 a tonne today. If these commodity prices stay where they are for another six months, that will be worth an extra $30 billion to our budget bottom line. But we took conservative commodity price assumptions, and we saw that more people are going into work. Three quarters of the fiscal dividend that we saw and we banked in this budget came from having more people in work and fewer people on welfare. So our goal is to grow the economy, an economy that is expected to grow by four and a quarter per cent this year and three and a half per cent next year. An economy that is leading the world.

CHALMERS: Well you've got to hand it to Josh. Even in the midst of a full blown cost of living crisis, the most wasteful government since Federation, taking for the first time in an election, a trillion dollars in debt and almost nothing to show for it, and he's still managed to find a way to give himself a little pat on the back. And it is incredibly frustrating for Australians right around this country for the Treasurer and the Prime Minister in the midst of this cost of living crisis for them to be telling Australians just how lucky they are. Now Australians have had enough of this self congratulation. They know that after a decade in office, the challenges in the economy are acute. And they know that only Labor has a plan to take seriously and deal with these challenges. And that's why the economic plan that we released is all about how do we deal, how do we grow the economy in an inflationary environment? How do we give cost of living relief over the long term not just to get themselves through an election? You know, how do we get real wages growing again? How do we get some benefit from this trillion dollars in debt? These are the key questions which are being ignored in this flurry of self congratulation from the Treasurer. Australians are not asking for too much from us. They just want us focussed on their everyday concerns. How do they feed their kids? How do they provide for their loved ones? How do they service a mortgage with interest rates rising? How do they save for a holiday when their real wages have been going backwards for some time, not just the last few months? These are the defining issues in the economy and they should be the defining issues in the election as well. Now all of the numbers that Josh will tell you about commodity prices and all the rest of it, they are cold comfort for people who are doing it tough and you can't take credit for high commodity prices without taking responsibility for the rest of the mess that Australians in real communities right around Australia are dealing with.

TINGLE: Thank you. The next question is from Shane Wright.

JOURNALIST: Gentlemen, Shane wright from The SMH and The Age. Following on from Laura's question. I love my dog Scully, like I know Josh loves his dog. I took it for a run this morning without incurring any cost on the taxpayer. But the Coalition has promised $320,000 for a dog park in the marginal Liberal held seat of La Trobe and Labor's promised $200,000 to upgrade two dog parks in the marginal seat of Macquarie. Given the level of debt and deficit, why is it a good use of taxpayers money to expend that money on pampered pooches in marginal seats? And is there any productivity gain to be made by spending money on dog parks?

TINGLE: Jim, you might go first this time.

CHALMERS: Thanks Shane and thanks Laura. There is a time for investment in communities but you need to make sure that that spending is well motivated. That it's not politically motivated. And what we've seen partly because of your work and Katina Curtis' work, is we have seen from the most wasteful government since Federation, we have seen people in ministerial offices poring over colour coded spreadsheets, allocating money purely for political purposes. This is one of the reasons why Australia doesn't have enough to show for Josh's trillion dollars in debt. This is one of the big problems we've got. And one of the most egregious examples of this was the more than $600 million committed to commuter car parks. Now every 10th dollar of that Josh committed to his own electorate, in some cases at train stations which soon won't exist, and he had to walk away from that commitment. None of them were even built and completed. Now there is a problem in the budget with spending in politically motivated ways. Now our commitments are typically working with local governments or state governments or others to make sure that we're getting maximum bang for buck which should be the test there will be commitments made by all parties around Australia. The key is to make sure that we get value for money for that. There has not been enough value for money in the budget the last almost 10 years. That's why we've got these stupendous levels of debt and why we don't have enough to show for it. We are committed to doing better, and we're also committed to auditing this wasteful spending in the budget, Treasury and Finance within the first year of a Labor Government because Australians deserve better value for money for their cherished taxpayer dollars.

FRYDENBERG: Of course the Labor Party is always holier than thou even though I think the same paper found that the Labor Party were providing small grants in a whole range of targeted seats. And we do know that the Labor Party in which Jim Chalmers was the Shadow Finance Minister ahead of the last election also had a park and ride scheme. And Bill Shorten was going out and promoting it and making announcements ahead of the last election, and they are about projects to get more people onto public transport. But with respect to local community programs, they'll always exist they have always existed, and they will continue to exist. But our focus in the lead up to election day has been making big announcements, big announcements about glucose monitoring for people with type one diabetes, big announcements about the income thresholds for concession cardholders to make it more available to 50,000 seniors, big announcements around the co-payment for PBS medicines and so forth, and also big announcements about deeming, all of which all of which the Labor Party has simply copied us. So this is the Labor Party's strategy, a small targets strategy to forget about their addiction to higher taxes and simply to copy the Coalition. There's four policies that we've announced in recent weeks where the Labor Party was quick to say yes, we'll do that. Wasn't their idea, but were yes to do that. Because they know we were the ones who came up with cost of living measures. We were the ones who took to a budget just a matter of weeks ago, measures to halve the fuel excise. Things that Jim himself was questioning before we announced it. We took measures to the budget which we are implementing now to ease the cost of living. We recognise this is the number one topic of discussion around the kitchen tables of Australians. Australians are doing it tough right now. And just as we had their back at the height of the pandemic, we have their back now. The Labor Party is simply trying to sneak into government and to copy our policies which are designed to ease the cost of living for millions of Australians.

TINGLE: So to clarify your answers to Shane Wright's question and paraphrase somebody else when's the reckless spending going to stop? What is the roof on this? And do either of you have a rule for how much outlays should be as a proportion of the economy? One minute each?

FRYDENBERG: Okay, well, as you know, in the peak of the pandemic, we saw payments go up to about just over 30 per cent of GDP. Now they've come down to 27 per cent of GDP and they're going to come down further to just over 26 per cent of GDP. What we are seeking to do is to end that emergency economic support and we will criticised by Jim and his party for doing so. I mean, JobKeeper, the COVID disaster payments we were criticised by Labor when we brought that spending to an end. What we want is the economy to normalise. And that means ensuring that we focus on the things that will boost the productivity of the nation and will create more jobs, tax relief, investing in more roads, investing in water infrastructure, investing in telecommunications infrastructure.

CHALMERS: We don't doubt the Government's ability to make announcements we doubt their ability to deliver them. And when you look at the spending in the budget, Josh wants to make an issue out of the things that we agree with the Government on. I think Australians expect us from time to time to have the same view about some of the initiatives that he's talked about. This is a Government which has spent more, taxed more and borrowed more than the last Labor Government but delivered much less. And that's because the budget is absolutely riddled with rorts and waste and that's why it's heaving with a trillion dollars in Liberal Party debt. So what Katy Gallagher and I have said, is that immediately if we are elected to office, we will audit the wasteful spending in the budget, the rorts in the budget to try and get the budget on a more sustainable footing so that the spending in the budget, investment in the budget delivers a tangible economic return.

TINGLE: The next question is from Patrick Commins.

JOURNALIST: Patrick Commins from the Australian newspaper. I have a question for both of you. Capacity constraints in the economy, supply side issues are a big part of the rise in inflation and now interest rates, and also a big part of that story, the supply constraint story is around the labour market. There are severe labour market shortages. Now business want two things, they want skills, they want greater investment in skills, more upskilling for the nation, you both agree on that. They also want a boost to skilled migration so we can get over the hump in the near term while we skill up the country. Why is neither of the major parties prepared to come into this election with a commitment to increase temporary skilled migration at least for a temporary, sorry permanent skilled migration, at least for a temporary basis?

FRYDENBERG: You won't see from us cheap political opportunism when it comes to skilled workers. You will see that from the Labor Party and we have seen that from the Labor Party. Those skilled migrants perform an absolutely vital role in our economy, helping to address some of those workforce shortages. Whether it's engineers on mining sites, whether it's IT programmers in our telecommunications companies, or whether it's people working in our hospitality industry. And since we opened the borders in November, we saw more than 70,000 skilled migrants coming to Australia. But it's not just about skilled migrants. It's also about labour mobility across state borders, and Andrew Barr is in the audience and we worked together around the Council of Federal Financial Relations table to get an agreement to occupational licensing changes, which stayed in the too hard basket for more than a decade. And what that will see is more than 150,000 people benefit as they move between states without needing a new license, paying a new fee and new qualification. And that's going to provide more than a billion dollars of lift off or benefit to the economy more broadly. And then the third aspect of this because there's no silver bullet but it's skilled workers, its labour mobility, and it's also training up the Australian workforce. And we put aside more than three and a half billion dollars in the budget for 800,000 new training places with a fundamental structural reform to our skilling system, to replace what is known as the NASWD with the states and the territories, and to use the National Skills Commission front and centre with more efficient pricing and a better model rather than untied grants to the states. Our focus is on addressing some of those workforce shortages, which are very real but I do point out to everyone here it's a very clear contrast with Australia's previous experience after coming out of recessions. In the 80s and the 90s unemployment remained elevated for up to a decade. This time around when you speak to employers the biggest issue is where do I get more workers? That's good news for young people entering the workforce, and that will be good news ultimately for our economy.

CHALMERS: I don't think the Chief Minister will let me live down that you beat me to an Andrew Barr shout out so well, well played. I think this is one of the defining issues in the economy, and we are up for a sensible conversation about the optimal migration mix as we emerge from the pandemic. My colleagues, including Kristina Keneally and others have talked about trying to get that balance right, between permanent and temporary. I think that is one of the big challenges. But bringing people in, even in sensible ways should never be a substitute for training people for opportunities as well. You know, I agree with something that Josh said, which is that inevitably it is a mix between the two things. Too often, I think in the public conversation about skills and migration, people pretend that it's one or the other and in reality, of course, it's a mix of both. Now our issue that we have with the Government is they spent a long time hacking away at training and skills and TAFE in our economy and now all of a sudden the chickens are coming home to roost. If you look at the Reserve Bank Governor's statement yesterday, I thought one of the things that really leapt out at me was the issue that you raised about capacity constraints, and skill shortages are probably the defining capacity constraint. Now training is a big part of it. We've got a policy for fee-free TAFE more than 400,000 places. That's part of the story. But also child care is part of the story here. If we want a bigger workforce, we need to make it more attractive and easier for people to earn more and work more if they want to. That's a story about parents returning to work as well. So our policies are geared towards this challenge specifically. We've got inflation running out of control. We've got real wages falling. Part of that is capacity constraints domestically, not just the international issues that just likes to lean on. And so that's what our policies are all about dealing with.

TINGLE: The next question is from Karen Barlow.

JOURNALIST: Hello, Karen Barlow from the Canberra Times. My question is directed at the treasurer. A lot has been made by the Prime Minister and yourself regarding Anthony Albanese's lack of economic experience, in particular the economic portfolio, and not having done a budget, in fact you've said it earlier in your speech. Do you accept that many Australian Prime Ministers have been in the same boat including Robert Menzies, Tony Abbott, Bob Hawke? Looking elsewhere you've got Angela Merkel, and you can look to the President of Ukraine being a comedian before he entered politics. Do you accept that they are effective leaders or have been effective leaders and aren't you reflecting back on them?

FRYDENBERG: Certainly not. What our major concern is with Anthony Albanese is what we have seen to date, which is after three years in Opposition a lack of a detailed economic plan. I mean, Jim put out a 13 page pamphlet, and that's what he calls his economic plan. Three quarters of it was sledging the Coalition. And then the last few pages was talking about some multinational taxes that they wanted to introduce, which was a rehash of what Bill Shorten had talked about. And the other part of it was to have a review after the election, and we know he wants to have a budget after the election if he's successful, but he won't tell us beforehand whats to go into that budget, and the other was some more public servants. So I look at what Anthony Albanese has done with respect to his economic opportunity over the last three years to put an alternative plan and he hasn't done so. And so that is what is most damning of him. And he was found out early on in the campaign, when he didn't know what the cash rate was and he didn't know what the unemployment rate was. And as the Prime Minister said, it wasn't whether a per cent was missing here, or half a per cent here or half a per cent there. He was just way off. And I had said during the budget speech, of course, which was sitting across the table, the unemployment rate today is it's equal lowest in 48 years at 4 per cent. And he didn't know what it was. Now Jim would have known it because Jim has worked in this portfolio. But at the same time, he is the Leader of the Labor Party, and the choice is very clear who is going to lead a Labor government if they were successful. It would be Anthony Albanese, not Jim Chalmers.

CHALMERS: Look, one of the reasons why the Government is maintaining almost exclusively a focus on Anthony and the Labor Party is that they're hoping they can get all the way to the 21st of May without having taken any responsibility for this cost of living crisis, which is punishing people right around Australia. And they have their little slogans about Anthony and about the Labor Party because they can't defend their record, as I said before, spent more, taxed more, borrowed more and delivered less. And because they are entirely bereft of a plan for the future. Now, the two things you need if you want to pitch up for a fourth term, is the ability to defend your record and a plan for the future and they have neither of those things and that's why we get this pathetic point scoring about Anthony. Anthony is one of the most experienced candidates for Prime Minister that we've had in Australia. He was in a key economic portfolio of infrastructure. And he performed extremely well in it. And so I think you can take all of this other rubbish from the Government in that light.

TINGLE: Next question is from John Kehoe.

JOURNALIST: Thanks gentlemen. We have an inflation issue in this country now. That's been misjudged by the Treasury, the Reserve Bank. The budget forecasts inflation at just four and a quarter per cent peaking. The RBA said yesterday, it's now going to peak at 6 per cent. So my question is to both of you, the budget tipped an extra $39 billion of discretionary spending into the economy at a time when we've got inflationary pressures already. There's more commitments being made during the election. Labor is also pretty much match most of the Government's commitments and has some of its own spending priorities too. Are either of you prepared to make discretionary spending cuts or tax rises to help take pressure off the RBA on inflation and lifting interest rates? Or is this just a job for the RBA to keep lifting interest rates as high as they need without help from fiscal policy?

FRYDENBERG: Well, our spending plans are set out in the Budget and have been announced subsequent to the Budget. I do point out to you that Treasury was asked at budget estimates whether the announcements we made to ease the cost of living would have a material impact on inflation and they said no. And then if you look at the statement, which no doubt you would have looked at the statement from the Reserve Bank yesterday, they were very clear in their words. These are not mine. The main driver of inflation has been international factors. And you had Moody's come out yesterday and criticised the Labor Party for trying to politicise the cash rate increase. You see, Jim can't have it both ways. He was criticising the Coalition when interest rates fail. And yesterday he was criticising the Coalition when interest rates rose. And Moody's called him out just yesterday in a statement, which is very unusual. And so the point here is it's been the COVID pandemic, and it's been the war in Ukraine which have been the main drivers of the inflation. Now, importantly, you raised the notion of higher taxes. Other countries in the world like the UK and the US have lifted taxes through the pandemic. We have not. We've cut taxes by $40 billion dollars for households alone. And we increased that tax relief in the Budget. It is a very different approach between us and the Labor Party and the Australian people need to know it. We are prepared to have the discipline of a tax to GDP cap at 23.9 per cent. They are not. They took to the last election $387 billion of higher taxes, something that Jim said at the time he was proud and pleased of. Yet now they're trying to hide and not reveal what their true intentions are until they have a budget if successful after the election. That's not good enough. We know the Labor Party will always tax more. They'll always spend more, whereas our plans are set up very clearly in the Budget.

CHALMERS: The Treasurer has just lied to you. In every way that you measure tax in the budget, this Government has taxed more than the last Labor Government. That's just a fact. They've taxed more in total, they've taxed more as a share of GDP. They've taxed more per person. And they've tax more adjusted for inflation. So that's a lie. And we need to call it out when we see it. It's one of those big furphies that gets dragged out in election campaigns in particular. Now this tax cap that Josh talks about, 23.9 per cent. In the history of this nation, that tax cap has been breached four times. Every single time was a Liberal Government. Every single time. No Labor Government has any got anywhere near breaching the current tax to GDP cap. So let's have some facts about this on the table. This Government is the second highest taxing government of the last 30 years and the highest taxing was John Howard's. So enough of this rubbish about tax. Now John's question about how do we start to take seriously this fiscal challenge we have in the context of high and rising inflation. That is a key challenge that either of us will face, no matter who wakes up as the Treasurer on the 22nd of May. It is a key challenge. And we have already put on the table two ways that we think we can start to make a meaningful difference. John, you ask about discretionary spending cuts. We've announced $3 billion in trimming a budget which has gotten out of control when it comes to outsourcing and labour hire and contractors and consultants in the public service. And we have said that there is something that can be done responsibly, modestly carefully, to change the way that we tax multinationals so they pay their fair share of tax and Josh has said before that he supports that so I don't know why all of a sudden, he says he opposes it. We need to take this seriously. The budget's got a trillion dollars in debt with not enough to show for it. Only one side in this election is being upfront with people about the task ahead.

TINGLE: Neither of you have actually completely answered John's question, which was about spending and tax and also reflected what I was saying, we are now in a different economic environment of rising inflation to one we've had for the last, certainly the last 20 years. So the question I'd like both of you to answer is can you nominate actual discretionary spending cuts in terms of proportion of GDP, that you'd be aiming for in the next three years and with respect, Jim Chalmers $3 billion is eh big deal in a trillion dollar...

CHALMERS: Well it's $3 billion more than is being administered by the others.

TINGLE: And Treasurer, you haven't answered the question about the fact that you haven't really engaged in any serious discretionary spending cuts either. What is the task that we have to face and the taxpayers have a right to know about in the next three years?

FRYDENBERG: Well the focus of our spending is creating more jobs and driving up productivity. And I think both Jim and I would agree that we need to lift our productivity here in Australia and it's a global challenge right now. So the digital transformation, the 10 year $120 billion infrastructure pipeline. Melbourne to Brisbane Inland Rail, getting food from the paddock to the plate that much faster. A second airport for Western Sydney. Snowy 2.0, a major energy project . They're all nation building projects that have begun on our watch, and they're all about driving higher productivity. So we have also made significant changes to child care, including $1.7 billion in last year's budget, which was designed to make it easier for 250,000 families who will save more than $2,000 a year. So I would defend our spending. We've turned off the emergency support and with respect to taxes, our record is very clear. People are paying lower taxes under us than the Labor Party. And if Jim had his way and introduced $387 billion of taxes at the highest taxes the last election, the tax to GDP ratio would have gone to a record high of 25.9 per cent.

CHALMERS: Josh is fighting the last election again. Look the point that I would make about this, is the quantity of spending in the budget obviously matters a great deal, we pay interest on the debt the Government has racked up and so it matters. So you need to get maximum bang for buck. But what matters just as much, if not more is the quality of that spending. And if you stack up the record of the Government against the commitments that we have made in this, well before this election campaign, over the course of the last three years. Let me give you a couple of examples. Now the Government spent at least five and a half billion dollars on submarines that will never be built. We think we should invest a little less than that, but around that in child care so people can work more and earn more if they choose to. I can go through lots of examples of this. Our spending is responsible, it's carefully calibrated to deliver an economic dividend, whether it's productivity, whether it's participation, whether it's other forms of economic dividend. Because the big challenge in the budget which gets missed in the kind of conversation around the headline figures is that we're just not getting value for all of this debt. And we want to get some value for it. And we measure that by the economic dividend. There's been a lot of waste, there's been a lot of rorting of the budget over the best part of the last 10 years and we need to do much better than that.

TINGLE: Next question is from Sarah Martin.

JOURNALIST: Sarah Martin from Guardian Australia. A question to you both. Can you tell us what you expect the annual cost of Medicare, aged care and the NDIS to be in 10 years time and how you each believe the growing demand for these services should be paid for and are either of you prepared to have an honest conversation with the Australian people about this looming challenge for the country?

FRYDENBERG: Well we've set out the forward costs in the IGR and in the case of all of those areas they're going to continue to go up because we've got an aging population and we're also spending heavily in another key area which is disability support. So the expectation is that while the NDIS today is about 1.2 per cent of GDP that's going to go up to about 1.5 per cent in the coming years as set out by by the IGR. We're going to have to pay for all those services, including hospitals, disability support, increased mental health support, and education. And the way to do that is to grow our economy. And that is why I do defend the spending in productivity enhancing areas. I do defend our record where we've created more jobs so that nearly 2 million more people that are in work today than at the start of, the start of when we came to government. The way we're seeing an improvement in our budget bottom line is actually moving people from welfare to work. That's how you improve the bottom line. That's how you grow the economy. That's how you pay for those increased expenditures on social services.

CHALMERS: Every dollar that gets wasted or rorted in the budget is a dollar that can't go to some of those fast growing areas of important public spending. Medicare is one, NDIS as Josh said is another, aged care is another, defence spending will need to go up as well and we've acknowledged that too. And so what we need to be able to do is to flick the switch in the budget not to austerity but to quality, so that we can fund the things that we care most about including those four things that I mentioned a moment ago. If you take aged care for a moment, you know, we've got a $2.5 billion commitment in aged care, which recognises that people are not getting the care that they need and deserve. They're not getting the food they need and deserve. The workers aren't getting the support that they need and deserve. And that's a meaningful, important commitment, a modest commitment, which will make a meaningful difference to people's lives. And so as we reorient the budget away from the rorts and the waste that we've seen for much of the last 10 years, towards more meaningful, more productive spending, then of course we need to factor in that some of the things that we care most about are the things which cost more and more as time goes on. If you look at the intergenerational report, I think one of the great tragedies as an economics nerd, one of the great tragedies of the release of the intergenerational report is that it didn't get the attention that it deserved. What the IGR said, released by Josh and his department is that unless we change the way we go about things, we're up for 40 years where the economy is smaller than it's been for the last 40. We've got 40 years of deficits. We've got an extraordinary amount of debt, with not enough to show for it and that's why we need to start thinking differently about the budget. We have nominated areas where we can begin that task but the task should be there for whoever wins office in every budget until we can meaningfully pay for these commitments that we make to the Australian people.

TINGLE: The next question is from Chris Uhlmann.

JOURNALIST: Gentlemen, Chris Uhlmann, Nine News. Both of you claim to be able to control power prices in some way, wholesale power prices. The Government says that you're responsible for bringing power prices down. The Labor Party says that you can bring them down further. Wholesale power prices are on the march and they're on the march because the price of coal is on the march. Can you both explain why that will not be the case in the future, that that will continue to set the price of power in the marketplace? And as wholesale power prices go up, so will retail power prices?

FRYDENBERG: So commodity prices have gone up and coal is one of those and that's largely out of what has been happening in the Ukraine and it's the expectation of Treasury that those prices would start to normalise over time and then that would play through to the energy system. I do point out that electricity prices for households are down by about 8 per cent the last two years under the Coalition and for small businesses down by about 10 per cent and they doubled under the Labor Party. The key here is to get the transition right and that is particularly important as we move to net zero emissions. I used to be the Energy and the Environment Minister and I've got the scars to show it. What you've got to get right is that transition to more intermittent sources of energy. I saw when Hazelwood closed, Hazelwood was a dirty coal fired brown power station in Victoria responsible for about 25 per cent of Victoria's energy supply. Victoria went overnight from being a net energy exporter to being a net energy importer at time was a peak demand, but they saw a spike in the wholesale price of about 80 per cent at the time. And I remember getting calls into our office and indeed other offices from pensioners who couldn't afford the heating and they would have to sleep in bed with extra layers of clothes and extra blankets. And the same pensioners were sweltering in the summer and couldn't afford their cooling. And so the point here is that unless you get that transition right the cost to both households, and particularly the most disadvantaged members of our community who spend a higher proportion of their income, their disposable income on electricity, and businesses which are hugely price sensitive to energy input costs, like glass, like manufacturers of paper, steel, and other manufacturing goods are all hypersensitive to getting electricity prices down. So our focus is about a proper transition ensuring we've got dispatchable power like gas, bringing in more renewables into the system, having backup storage like pumped hydro and snowy 2.0. All of which hopefully will smooth that transition because inevitably we're moving to a smaller carbon footprint. That's a good thing for the environment, but it's also over time a good thing for the economy.

CHALMERS: This is a long term challenge, as you know, and it leads to long term policy and long term planning and shouldn't make your policy based on kind of near term spikes in prices. We all recognise, at least the major parties recognise, that there will be a mix of energy sources and that that mix will change over time. And it's not just the Labor Party saying that energy costs will come down if we introduce cleaner and cheaper energy into the system. The investment community has been saying that for some time to their credit, the peak business organizations have been saying that to their great credit, the contribution that they've made to this conversation. Now, getting cleaner and cheaper energy into the system is Australia's biggest opportunity over the next decade or two. And I think Australians are angry that we have been stuffing around with this for a decade now. All of this uncertainty created by a Government where some of the members say that net zero is rubbish and other members say that net zero is locked in, depending on where they are in the country whether they're in Kooyong or Capricornia. Okay, and there's a cost to that. There's a cost of that to our economy and one of the reasons why we need a Labor government. And a key part of a better future for this country is to finally get on with the job of grabbing this incredible opportunity that we have. Probably the most important opportunity that we have as a country and as an economy is to grab this thing because if we get that cleaner and cheaper energy, we will unlock tens of billions of dollars of investment. We will create hundreds of thousands of jobs, and we'll make energy cheaper, all the way from pensioners, to working families, to businesses as well. If we miss this opportunity, we should hang our heads in shame but that's what's been happening. This opportunity has been going begging and it's not good enough, it needs to change and it will change if there's a Labor government.

TINGLE: I'd just like to point out to the viewers at home that we're going to continue broadcasting till 1.40 today and we'll extend the broadcast to maximise the number of questions and at this point, I'd like to ask the two gentlemen whether they would ask each other a question for which they'll have a minute response time?

FRYDENBERG: My question to Jim, he says that...

CHALMERS: After you Josh...

(LAUGHTER)

FRYDENBERG: Sorry, you did speak first. My question to Jim is he says we revisit the last election, but it actually goes to the heart of the believability of the Labor Party. They are trying to sneak into government and say that they will hold a, having a budget after the election but not tell the people before the election what would be in that budget. Now Jim, you said you were proud and pleased of $387 billion of higher taxes. Higher taxes on super, higher taxes on income, higher taxes on housing, higher taxes on retirees, higher taxes on family businesses. Indeed there were media reports even less than a year ago about you revisiting the housing tax, the family business tax. What impact would have $387 billion of higher taxes that you took to the last election have had on an economy that has just encountered the biggest economic shock since the Great Depression with COVID?

CHALMERS: Josh, this might come as a big surprise to you but it's 2022 now. The 2019 election has been run and won. And I think it speaks volumes, frankly and with respect, of your approach to this job, and to this economy and to the future of this country. That when you're given an opportunity to ask one question of your opponent, you ask a question about the 2019 election. I think that speaks volumes about what you're offering the Australian people. Australians had their chance to cast their judgement in 2019. They cast their judgment and we respect the judgment that they made. We have been working around the clock since then to earn their trust. And part of that has been acknowledging where we put forward a policy that wasn't right and where we have found a better way to deal with some of these issues. Now, contest this election on the policies we're putting forward, not on the policies that we're not putting forward. Contest this policy on a Plan for a Better Future. That's what we're trying to do. You should try it too.

TINGLE: Jim Chalmers, do you have a question for the Treasurer?

CHALMERS: I do. How much Josh, do the real wage cuts in your budget cost the average Australian worker this financial year?

FRYDENBERG: Well firstly we're saying that wages will continue to rise. And there's about a $900 difference for somebody who's on average full time earnings between what the wages would be and what the inflation rate would be. But as you know, they get $1,500 in tax relief from the first of July. So that makes up for that difference between the WPI and the difference between, the wages price index and the inflation rate.

TINGLE: Next question is from my ABC colleague, Andrew Probyn.

JOURNALIST: Finished early there Treasurer. Gentlemen, Andrew Probyn, ABC. I wanted, just talk about the, ask about the NDIS and firstly, your budget, Treasurer, forecast the NDIS costing $70 billion by 2030. Well in excess of any expectation. Now both sides of politics over the years have to their credit, proposed ideas to pay for it and Julia Gillard in 2013 with an increase in the Medicare Levy, Scott Morrison too by another 0.5 per cent in the 2017 Budget. You might remember he cited his brother-in-law, wanted to give his brother-in-law funding certainty. But he ended up scrapping that idea a year later claiming that the Government had found source funding through unexpected extra revenue. Now, given the current circumstances, given there's a trillion dollar debt, do either of you have the courage that Julia Gillard showed, the courage that Scott Morrison showed at one point, to propose a levy to fund the NDIS which is blowing out in cost? And in anticipation you're going to mention it. Please don't say it's fully funded. Because if it's fully funded, how do you explain that to people who are going to be lumbered, your children, my children with $1 trillion debt?

FRYDENBERG: Well, our plans are set out in the budget... 

JOURNALIST: That is not an answer.

FRYDENBERG: But that is the truth. You're asking about future levies. And I'm saying to you that what we have set out is the funding for the NDIS which is going to continue to grow and as I said earlier, from 1.2 to 1.5 as a percentage of GDP. What we have undertaken as the Commonwealth and obviously, we inherited this from the previous government was a structure where the Federal Government, the Commonwealth Government was up for the bulk, for the bulk of the expenditure increase in the NDIS. So today, we're picking up about two thirds of the increase that will lift to about 75 per cent. Now I recognise that the NDIS, Andrew is an absolutely critical program, and it is providing support for the people who need it most. But it is increasing both in terms of demand and in terms of cost. And today you have half a million people on the NDIS, half of whom are getting support for the first time. And those numbers will actually increase over time. So we're going to continue to fund it. You know I put 30, there was $30 million in the budget to help the NDIA in terms of compliance. So there are measures there to ensure that we are getting value for money out of that scheme. So we put that in the budget, $30 million in the budget. But what I recognise is that we need to continue to fund this scheme. And we continue to provide those services even as it becomes more expensive.

CHALMERS: Thanks, Andrew. We're not proposing to introduce a levy to pay for the NDIS as some of the predecessors that you mentioned have proposed in the past. We do recognise as Josh just did, that this is a big and growing part of the Commonwealth budget, but it's an important part of the budget as well. And I think what we need to do in this country is change the way we think about the care economy. You know, this is about, this is primarily about providing a level of services to the most vulnerable people in our society. That's an important part of what we're talking about here. But there's also an opportunity for Australia, a vast opportunity for Australia in the care economy, whether it's disability care, whether it's aged care or whether it's child care. And we need to also be seeing investments in this part of the budget as job creating, prosperity creating, productivity enhancing investments, and so they deliver a double dividend. The cost is substantial, not disputing that. But so are the benefits for individual people being cared for, but also for the economy more broadly. If you look at the way that our economy is changing and evolving services, particularly in the care economy will be a bigger and bigger part of our economy as our society ages. And so we need to see it that way as well. We get a benefit of it as a nation as well as a benefit for it at the individual level. We pay for that in the usual way and we're not proposing to change the tax arrangements for it.

TINGLE: If I could just follow up on Andrew's question, how can the NDIS be fully funded if people's schemes are being cut back, if their plans are being cut back at a great rate of knots? And the Productivity Commission five years ago said that one of the problems with the NDIS wasn't with the scheme itself it was the fact that the rest of, a lot of the care economy wasn't properly funded. Is there a case for revisiting the arrangements with states and local governments about the services they provide, so that the NDIS is not ending up carrying services that were previously covered by other sectors?

FRYDENBERG: Well I mean, in terms of Federation, there's always opportunities to sit around with your counterparts at the state level to work through these issues. Because ultimately, we're both heavily invested in it states, territories and the Federal Government. So there will be those sorts of discussions because we both mutually have responsibility for the scheme. But what I was pointing out, Laura, is that it's the Federal Government, that is shouldering the bulk of the load right now. Two thirds of the increase in the NDIS costs are being met by the Commonwealth that's lifting to 75 per cent over time. And what we did do in the budget is we made an allowance for increased compliance.

CHALMERS: We should always be looking for ways to improve the NDIS. The NDIS is a terrific idea, which has not always been well implemented. If there are opportunities for discussions with all of the relevant stakeholders about how we provide a better level of care and service and how we fund it most effectively, then both sides of politics should be up for that conversation. You know, as a local member in my part of the world, I know that there are a lot of concerns with the NDIS right now, about packages, about access to decent services, about the responsiveness of the service. And so, as we have been saying throughout the course of this campaign, and well before that, we do think the NDIS can be better, that inevitably necessarily involves a conversation with all of the stakeholders.

TINGLE: Peter van Onselen has a question.

JOURNALIST: Peter van Onselen for Network 10. My question is for you both, probably starting with the Treasurer. What's your plan to get tax to GDP and spending to GDP into line to get rid of the structural deficit?

FRYDENBERG: Well obviously it's about growing the economy. That's what we're seeking to do, and therefore we can manage those high debt burdens. But we have set our tax to GDP cap at 23.9 per cent, bearing in mind today it's around 22.4 per cent, because we believe in the discipline of ensuring that we don't lift taxes beyond a certain amount. The Labor Party will not have that discipline. As I said, and the reason why I asked Jim about his commitments at the last election is because that would have seen tax to GDP go to 25.9 per cent. And he is seeking and the Labor Party is seeking to go to the next election, saying that those things that were hand on heart, fundamental principles and policies and philosophies for them, little less than three years ago, no longer is relevant. And that is just not being true to the Australian people. So we are seeking to end that emergency support as I said. You had spending as a proportion of GDP above 30 per cent during the height of the pandemic, that's come down to around 27 per cent today. That will come down another per cent to around 26 per cent. Tax to GDP at 22 per cent, just over 22 per cent today, does go up over time, but because we have that speed limit with the tax to GDP cap of 23.9 per cent we're prepared to say we will continue to cut taxes. The Labor Party will never say that.

CHALMERS: Well, there's lots in that, so let me try and gallop through all of the furphies that the Treasurer just talked about. First of all, the issue about tax to GDP. I dealt with that partly before. Taxes as a proportion of the economy average 20.9 per cent under the last Labor Government, 22.3 per cent under this Liberal Government. The only four times that the tax to GDP cap's been breached in the history of this country was under a Liberal government. You ask about the relationship between the Government's so called tax cap and their level of spending. There is an issue with the structural position of the budget. And one of the reasons why I think a lot of the serious economists are critical of the approach that the Government has taken is because they've capped one and not the other and that, depending on the level of growth in the economy, has the capacity to deliver a structural deficit. The IGR says that there'll be deficits for the next 40 years, partly as a consequence of the way that the Government is going about this. Now Josh knows, because he reads by transcripts more closely than any other human being on the planet, that we are only taking to this election one tax reform proposal and that's multinationals that he has previously said that he supports. We have put on the table, some responsible spending cuts. We've put on the table a process for the way forward to try and get the budget under control. When people at home hear the Government talk about the budget position, particularly when they try and play politics with Labor, never forget that on the facts, indisputable facts - this Government has taxed more and borrowed more and spent more than the last Labor Government and delivered less.

TINGLE: Andrew Clennell from Sky has a question.

JOURNALIST: Gentlemen, neither of you are really saying what you're going to do in terms of spending cuts or tax rises after the election, so let's try something different. Why don't each of you tell us what you think specifically the other guy is going to do in terms of tax rises or spending cuts? You've been saying Anthony Albanese is in charge of, wants death duties for example, let's see if you say that here. And while you're at it, given we're talking about debt can Jim Chalmers name the net debt... But you could mention the debt figure for 22-23, just putting it out there for you?

TINGLE: We might start with Jim Chalmers this time.

CHALMERS: Okay. Well, net debt $715 billion for 22-23 in the Budget that was just released. On the issue of what I fear from this Government, I fear that they will continue to ignore this cost of living crisis. And I fear that this Government will continue on the path that they've created for the best part of a decade now. The biggest risk at this election is that nothing changes at all. You know it takes an especially out of touch Liberal Treasurer in the context of skyrocketing inflation out of control and falling real wages and rising interest rates and consumer confidence plummeting, his key argument at this election is you want to stay the course. Why would Australian families want to stay that course? The course that this Government has us on is punishing people. They're falling further and further behind. Their household budgets are getting pummelled by this triple whammy, this cost of living crisis. So my big fear and my message to anybody who might still be watching, is that the biggest risk here, the biggest risk here iin this election is three more years of the same. Now only a Liberal Government, a Liberal Treasurer, a Liberal Prime Minister this out of touch would see the inflation numbers, the real wage numbers, rising interest rates, all the rest of it, and think that what Australians really need is more of the same. More of the same from more of the same of this Government is absolutely punishing people and we can't stay on this course.

FRYDENBERG: My greatest fear is that if Labor got over the line, they would revert to their natural instincts to tax more and to spend more. Instincts that were on full display when they thought they had the election in the bag last time. When you go to their national platform, it spells out increased spending on aid, increased spending on a paid parental leave scheme, increased spending on childcare. We've totalled up the cost of that increased spending, it's more than $300 billion. Yet any hard question and Jim will dodge the answer, and that's the reality. He's the same Shadow Treasurer that was Shadow Finance Minister at the last election who described small business as the top end of town. He was the one who said he was proud and he was pleased of a retirees tax and a housing tax. And he's the same Shadow Treasurer that said a housing policy that did not tackle capital gains and negative gearing was a shocker. They're not my words they're his. So if you ask me what my biggest concern is, is that what he is saying to you today is not what you can believe, you cannot take it to the bank. Because Anthony Albanese who's championed higher taxes his whole life, whether it was a carbon tax or a mining tax, or the higher taxes of the last election, backed up by his then Shadow Finance Minister, will do the same if they get half a chance.

TINGLE: We'll have one final question from Melissa Coade and then closing statements.

JOURNALIST: Good afternoon, Melissa Coade from the Mandarin. Economic vision, we've got a desire for less waste, less rorts and there's the economic plan and record that the Coalition talks about but the public service are the one who implement this vision. Labor have announced some plan for what they hope to see change in the public sector. And my question for both of you is to invite a comment on how the public sector either more public servants or reforms in other ways can help implement the bold economic vision you both put forward?

FRYDENBERG: Well I can only say from firsthand experience in the last three years, how outstanding and professional the public service have been, and I'm sure Jim would agree with me on that. We have relied more heavily and more, more than ever before, not just on the advice of Treasury but the advice of the Department of Health. And we've also relied on them to implement the policies in record time, payments that have gone out to the community when they needed it most. So I've only got the utmost respect for the public service. Numbers have actually increased under us for the public service, but it's about making sure they work most efficiently and effectively because ultimately, they're paid by the taxpayer.

CHALMERS: I have the same view as Josh about the professionalism of the public service. We've both had the opportunity to work closely with Treasury in particular, and we do agree that there are first class public servants in that department and right around the public service. It's one thing to respect and admire the public service and it's another thing to invest in its capacity. And one of the policies that Katy Gallagher, my colleague has released as part of our trimming spending on outsourcing in the public service, is to invest in the capacity of the public service in key areas where it's been especially hollowed out. We have high expectations here, and so we should, of the public service in Australia. It is one of the finest in the world. And it's got a lot to be proud of. But as governments or alternative governments, we need to make sure we're investing the right amount in their capability and their capacity. I've worked closely in the past in the portfolio that Josh keeps mentioning, on public service reform. I thought that there was a missed opportunity, frankly, out of the Thodey review that was done before or during the course of the last term of government. And so I think there are opportunities to pick up and run with some of that agenda. But part of that is investing responsibly in people in the public service so they can continue to deliver the high quality of services, the high quality of advice that we need in this country and that Australians deserve for their taxpayer dollars.

TINGLE: Well, thank you both gentleman, we'll have closing statements in reverse order from the opening ones and if you'd like to conclude your remarks for a period of one minute. Treasurer?

FRYDENBERG: Thank you very much Laura, and thank you Jim. He said earlier that he respected me and I want to repay that compliment. I respect him and he does bring a great deal of experience to the role, and off camera we actually get on better than probably we do on camera. But we're here to debate the issues, and we're here to debate the policies, and we're here to debate the alternatives that the Australian people have before them at the next election. Now, the Labor Party would like to wish away the last few years but the reality is that we have faced the biggest economic shock since the Great Depression and he set the test. He said the biggest test of the Morrison Government's management of the pandemic would be what happens to jobs and unemployment. We have delivered the lowest unemployment rate in 48 years and it's going to go even lower. Each one of those people whose jobs are saved is a mum or a dad or a brother or sister, and we have the economic plan set out the Budget to make Australia even stronger for the future.

CHALMERS: Well, this debate and this election can't be about, can't exclusively be about the past. It's got to be at least partly about a better future and we've got a plan for a better future. At the core of that is a stronger economy and more opportunities for more people. That's the difference really. That's the choice. One side, the Labor side has a plan for that better future and the Liberals and Nationals want to bang on about the 2019 election. Australians deserve better than that. We are here for one reason we need to remember Josh, who sent us here and why we're here and that's to deliver for Australians in their communities. The very troubling thing about this debate is that you either don't know or don't care what the impact of the real wage cuts in your own budget are for ordinary working people. $1,355 this financial year.  And that speaks volumes, I think about a Government which has let inflation run out of control and dropped the ball on cost of living. A government which has deliberately gone after wages and job security for the best part of a decade and the consequence of that is a full blown cost of living crisis. Only Labor has a plan to strengthen the economy to deal with that and to deliver the better future that Australians need and deserve.

TINGLE: That concludes our 2022 Treasury debate. Thank you to both of you for answering, or not answering our questions. Please join me in thanking Jim Chalmers and Josh Frydenberg.

ENDS