E&OE TRANSCRIPT
TELEVISION INTERVIEW
SKY AFTERNOON AGENDA
WEDNESDAY, 7 OCTOBER 2020
 
SUBJECT: Federal Budget. 
 
KIERAN GILBERT, HOST: Let's bring in the Shadow Treasurer now, Jim Chalmers. A big 24 hours. First up, where is Labor at when it comes to the budget? Looking at the budget and the main measures, it's hard to see that you’re really going to oppose the tax cuts or the business incentives when Labor had a very similar idea at the election?
 
JIM CHALMERS, SHADOW TREASURER:We certainly support the income tax cuts. We've said for some time that they should be brought forward. It's pleasing to see the Government do that, so we'll support that. There are four other elements of the tax bill. Some of them are Labor initiatives that were abolished by the Government and now being reinstated and we'll be positive about those. There’s some very big spending in there; at $27 billion we want to make sure that that's right. We're inclined to support it. There’s the early expensing for businesses, we're inclined to support that but we want to make sure that we've had a proper look at it. There's some R&D tax changes too which fit into the same category.
 
GILBERT: But the tax cuts can happen pretty much for the individual taxpayers. The work can start immediately? 
 
CHALMERS: Absolutely. We want to give the assurance to the Tax Commissioner and to the broader community that Labor does support those income tax cuts. Just this afternoon I've written to the Tax Commissioner to formally indicate our view that we want to see those tax cuts brought forward. That's all he needs now to be able to implement those new tax scales so that people can get the tax relief that they need and deserve. 
 
GILBERT: In terms of the business asset write off, is your problem with the fact that it goes all the way up to businesses with a turnover of $5 billion per annum? Is that the concern?
 
CHALMERS: That's one of the elements. We're inclined to support it. We've had an initial discussion, and people are positive about the business tax changes but we saw this $27 billion spend at 3:30pm yesterday so we've only had it for about 24 hours. We want to make sure that we're doing the right and responsible thing and that means going through it. We hope to be able to support it. Unless something pops up in our investigations, that's what we'll do.
 
GILBERT: You've been critical of this wage subsidy the Government's looking at for younger workers; its impact on older workers, and that not as much is going into that as tax cuts. In principle, don't you think the idea of helping younger people into work is a good one, given youth unemployment is many multiples of the general unemployment rate?
 
CHALMERS: Clearly, we want to help young people back into work. The point that we've made about the hiring subsidy is the Government somehow managed to rack up more than a trillion dollars in debt and still leave 928,000 Australians on unemployment benefits unable to access their hiring scheme. We think that doesn't make a lot of sense.
 
GILBERT: In principle do you like the idea of this $200 per worker under the age of 30 wage subsidy, and $100 for those between 30 and 35? Is that a good idea?
 
CHALMERS: We’re worried about the people excluded from it. Clearly, we support wage subsidies. We've been talking about them for some time – 
 
GILBERT: But do you think it should be universal for anyone unemployed?
 
CHALMERS: We think that the cut off means that too many people miss out, 928,000 is not a small number of Australians. They're on JobSeeker right now; they might have just lost their job. There's no certainty about how much JobSeeker they'll get. It might be $40 a day which is obviously inadequate. So the issue there is that there is this big program that the Government's trumpeting, but not telling people that almost a million Australian workers can't even access it. That's a problem.
 
GILBERT: Do you buy the Treasurer's argument? He says there's two layers of safeguards to prevent an employer from sacking someone who's 55 and employing someone who's 25, or maybe two people who are 25 to broaden the workforce for less money or the same. 
 
CHALMERS: That's one of the issues that we're looking at. My colleague Brendan O'Connor and I are looking precisely at those kinds of issues. The problem we've got is the Government has made big claims about big spending programs before and it's fallen over in the implementation. We don't want to see that happen again.
 
GILBERT: Are you going to promise free childcare? There were reports today that Anthony Albanese with his budget reply will commit to at least some level of free childcare? Is that on the agenda?
 
CHALMERS: Anthony Albanese has said this afternoon that the story is not accurate. I'm not going to pre-empt what may or may not be in the Leader's budget reply, that would be career-limiting in the extreme! I will say it's amazing the Government has racked up a trillion dollars of debt in this budget and there’s still nothing for childcare. One of the biggest issues we've got is women's participation in work as the economy recovers; we want women to be able to grab the opportunities in the recovery and it's bizarre in the extreme that the Government hasn't taken that approach.
 
GILBERT: Is childcare the number one issue when it comes to that? The Treasurer says 60 per cent of the jobs that have returned in the nascent recovery that we've already seen have been women. That's a good trend. But is the key going to be childcare to maximise that number?
 
CHALMERS: Childcare is a crucial piece of the puzzle. Women were disproportionately impacted by the recession. So that number about women coming back into work, we need to recognise they start from further back in terms of the impacts. Childcare is an important piece of the puzzle. Its remarkable that in a budget with a trillion dollars of debt and $100 billion dollars of new spending, they couldn't find a cent for childcare.
 
GILBERT: Can we live with bigger deficits? If you look at the interest repayments, they're pretty steady across the forward estimates. 
 
CHALMERS: At times like this when we're in the midst of a deep and damaging recession, the Government needs to step in and support people more –
 
GILBERT: Should they have borrowed more?
 
CHALMERS: That comes with a price tag. Our issue is not necessarily with the level but with the effectiveness of the spending. We've seen all kinds of rorts and pork barrelling and all kinds of mistakes made with government spending. We want to make sure when we consider that every dollar here is borrowed that we get maximum effectiveness out of that and we measure that by what it means for jobs. 
 
GILBERT: Do you think that they should have borrowed more, because there are some economists saying that they haven't done enough in terms of a response to the RBA’s call for fiscal firepower? Are you worried about that?
 
CHALMERS: Certainly the Government got in too late in this recession. One of the key things here is how quickly you respond to the economy deteriorating. The Government was in late and JobKeeper was too narrow. But there have been other instances as well where there's been money wasted. The point that we've made is let's get bang for buck for all the spending. It's all borrowed; it's going to take a lifetime to pay back. We need to make sure that every dollar we spend is doing the job that we need it to.
 
GILBERT: Is it reasonable for the Government to base its forecasts on the assumption that there'll be a vaccine by the end of next year?
 
CHALMERS: Not just that there'll be a vaccine discovered, but that it will be deployed broadly around the country. People have made commentary; I don't know if that's going to be the case. I hope it is. Obviously, we all want the vaccine to be deployed as quickly as possible. If it’s not, though, then clearly that will have big consequences for the budget. 
 
GILBERT: The Prime Minister this morning said to me that this is an assumption. It’s not going to affect people's tax cuts, or other payments and so on. It basically just affects the parameters of the budget, the GDP forecasts, and so on. Is that a fair enough response?
 
CHALMERS: That has impacts on the budget as well. We haven't made a big song and dance about that assumption. We hope that it's right; we hope we get that vaccine deployed because that is a big part of the story. What we do know now is the economy is weaker than it needs to be and the unemployment queues are longer than they need to be because the Government hasn't been as effective as they needed to be in responding to the recession.
 
GILBERT: Do you see infrastructure and manufacturing as a couple of key areas where Labor can differentiate itself, because obviously in trying to find ways to make your argument there's not a lot you're disagreeing with the Government on when it comes to the key measures in the budget?
 
CHALMERS: The key difference in those areas, particularly those areas, is they’re them main areas where the Government makes big announcements and doesn't follow through. They haven't hit their target for infrastructure spending once in any budget. In manufacturing they've made all kinds of announcements and not followed through. We need to see them deliver in those areas. 
 
GILBERT: Do you think people buy it when you say the Morrison Recession because everyone's seen the pandemic? 
 
CHALMERS: It's a statement of fact. Morrison is the Prime Minister and we're in the worst recession in almost 100 years. I don't know what people are objecting to. It's a statement of fact. In our view, the recession is deeper than it needs to be because they got in too late and too narrowly with government support, and they look like they're exiting too soon when it comes to things like JobKeeper. 
 
GILBERT: But it's in mid-pandemic. It's a global recession. It's a COVID recession.
 
CHALMERS: Scott Morrison is the Prime Minister. We're in recession. It's the Morrison Recession made worse by decisions his Government is taking. 
 
GILBERT: Jim Chalmers, thanks for your time.
 
CHALMERS: Thanks, Kieran.
 
ENDS