JIM CHALMERS MP
SHADOW TREASURER
MEMBER FOR RANKIN

E&OE TRANSCRIPT
RADIO INTERVIEW

POLITICS WITH MICHELLE GRATTAN
WEDNESDAY, 12 MAY 2021

SUBJECTS: Budget 2021

MICHELLE GRATTAN, HOST: Jim Chalmers your central criticism with the Budget appears to be it doesn't do enough to push wages up, but if you pull unemployment down isn't that a central way of increasing wages?

JIM CHALMERS, SHADOW TREASURER: It's an important part of the story, Michelle, but it's not the full story. Getting unemployment down is obviously a very important objective, the closer we can get to full employment the better. But the country's had an underemployment problem too for much of the last eight long years of this coalition Government, and that's part of the story, too. So we need to deal with unemployment and underemployment, and we need to deal with some of the structural barriers to people grabbing the opportunities in this recovery - whether it's childcare, training, industrial relations, concentrated disadvantage and long-term unemployment. All of these things have been left to fester for too long and that's preventing people from getting a slice of this recovery. The defining element in my view of the Budget is even after the Government spends $100 billion and racks up $1 trillion dollars in debt, working people are still going backwards because they're coping a cut in their real wages and that's an extraordinary admission of failure. More needs to be done to deal with the issues in the labour market so people can actually get ahead and provide for their loved ones.

GRATTAN: But of course there are two points here. One is that some things outside the role of Government or the control of Government, and the other thing is what more can Government do, should the Government do?

CHALMERS: Obviously there's a role for Government, there's a role for the private sector, and we've never pretended otherwise. But if the Government's prepared to intervene in the economy as they have been and spray around what is an extraordinary amount of money, then you'd think that working people will actually get a slice of the recovery. It's amazing to think that after everything that Australians have been through the thanks they get from their Government and this Budget is a cut to their real wages. It's a pretty extraordinary admission of failure. So what we say is we can deal with issues in industrial relations, the fact that work is not secure, there's a casualisation problem, underemployment problem, makes people's work lives precarious, we've had lots to say about that, skills and training. The cuts to apprenticeships over eight years haven't helped childcare. We've got a superior offering. There are a range of things that Government can legitimately do, responsibly do, to try and turn around these issues that we've had in the labour market, not just as a consequence of the pandemic, but for much of the last eight years.

GRATTAN: You emphasise the extraordinary amount of money, isn't the truth of the thing that the Government has in fact left Labor struggling to find political space in the wake of this Budget, you can really only say, do more of this, do more of that?

CHALMERS: My view is if you do the right thing in the Budget and you get the economic settings right so that we've got that broad and inclusive and sustainable growth where working people actually benefit from it and get a slice of the recovery, then the politics will take care of themselves. And I know that there is a political conversation about whether or not the Government's tried to minimise the differences with Labor on the economy, which is pretty amazing in itself.

GRATTAN: Well it has, hasn't it?

CHALMERS: It's amazing in the sense that you think about that dishonest sham campaign that they've run for ten years that you have observed Michelle as closely as anyone. Debt when it was a fraction of what it is now is a disaster and now all of a sudden it's responsible. I think their credibility has been shredded over the last ten years, but the politics will take care of themselves. Let's get the right outcomes in the economy. Among the many deficits in the budget was a deficit of vision, and I think Labor has a role to play there to say this is how we make the economy stronger after COVID than it was before COVID so the working people can actually get ahead in this economy and aren't held back by those stagnant wages.

GRATTAN: But on this point about the debt argument, even if one accepts that the Government overhyped debt in earlier years, you've got to admit that circumstances have changed very, very dramatically?

CHALMERS: We've been consistent all along, Michelle. And we've said that there is a role for Government and there's a role for the Budget to step in when people's livelihoods are at risk, we've been entirely consistent about that. The Government's run this sham campaign for much of the last ten years based on a big lie. And the fact that they've had to at least rhetorically shift away from that I think shreds their credibility. It means that you can't believe a word that they say about the economy. We've been consistent, there's a role for Government when things are difficult, as they have been in the last year, as they were a little over a decade ago. But when you're spending that amount of money, it's not just the level of debt that matters, it's the quality of the spending. And this Government's got a Budget which is riddled with rorts and weighed down with waste. There are new slush funds in last night's Budget and that means we're not getting the bang for buck that we need to be getting in terms of jobs and other important objectives.

GRATTAN: Well just on the question of the actual measures, are there any measures that Labor will fight in the parliament?

CHALMERS: Well we're still going through the Budget. as you'd expect. We go through it with a fine tooth comb. We are worried about those slush funds, there's billions and billions of dollars set aside for political reasons to get them through the election.

GRATTAN: What are some examples here?

CHALMERS: Well there's twenty-one in total so it would take us too long to run through all of them.

GRATTAN: Could you give some of them?

CHALMERS: The Better Regions Funds has been one of those funds that the Government has routinely rorted and there's a top-up to that fund. That's one example that Katy Gallagher has been talking about. But my point is really this: a lot of wastage in the Budget there's a lot of rorts in the Budget over the last eight years. I think the Australian people have a right to expect them to spend their money more responsibly. Every dollar is borrowed and so we need to make sure we're getting maximum benefit from it.

GRATTAN: Do you accept that the Budget will at some point have to be repaired in fiscal terms, and would Labor be willing to do it if it won the election?

CHALMERS: I think there will come a time where it would be responsible to repair the Budget but the best way to do that and our first port of call is to grow the economy sustainably enough that debt as a proportion of the economy comes down, that's our first priority. One of the many missing ingredients in the Budget last night was a plan for how to do that. There's an assumption that that will happen, that somehow the debt will disappear, but not a plan to do it. I think the difference between us and the Liberals when it comes to a plan for the future is we want to genuinely grow the economy. That will require a shift in energy policy, skills and training, innovation so we're turning our ideas into jobs, all of the things that we've been talking about, that the Government has largely vacated the field on.

GRATTAN: But apart from growth would you as Treasurer have the backbone to undertake the hard decisions to repair the Budget when the time came?

CHALMERS: Yes, I think so Michelle. And there are a number of ways to do that. Let me give you one example. It is my personal view that, on multinational taxes, that the system can be improved to make that part of the system fairer.

GRATTAN: Both sides have said this for years.

CHALMERS: Well, I think, only one side's meant it. But you know, there might be opportunities in there down the track. Clearly, we'll go through all the Government spending as well, try and spend it more effectively. I think when it comes to the debt and deficit, we've acknowledged there's a role for the Budget to support jobs in the near term. I think both sides acknowledge at some point the Budget will need to be repaired. I think the Government will go for harsh cuts if they're re-elected. I think we'll be more responsible about it.

GRATTAN: You will only have mild ones?

CHALMERS: We'll go through what the Government's proposed. Anybody who looks objectively, as you did Michelle, at the Budget over the last eight years, the idea that there's not waste and rorts in that Budget is laughable. So there might be some opportunities for us to either wind back some of that spending or spend more effectively.

GRATTAN: Jim Chalmers, thanks very much for talking with us today.

CHALMERS: My pleasure, Michelle. Thank you.

ENDS