KIERAN GILBERT:
Let’s bring in the Assistant Minister for Treasury, Competition and Charities, Andrew Leigh, who’s live in the studio. Andrew, pointing out that there’s been no Ministerial contact yet, but the Prime Minister reiterating that whenever they have an opportunity that will be raised to their concerns about the near miss last week.
ANDREW LEIGH:
Yes, Kieran, this isn’t just an issue of safety for our defence personnel. It’s also a question of maintaining international law and the freedom of our military to operate in international airspace. So, we are concerned and we’ve made those representations at the appropriate levels.
GILBERT:
It’s an interesting paradox, though, because during Beef Week, where we’re seeing all sorts of export deals done, Chinese representatives there, along with others from across the region. So, on the one hand, the trade relationship back on even keel, but some instability elsewhere.
LEIGH:
This will be true throughout our lifetimes, Kieran. If you go back 100 years, our biggest trading partner was Britain, which was instrumental to the founding of the Australian colonies. Then we had the United States, with which we had a defence relationship. But now and for the foreseeable future, our largest trading partner is going to be a country with which we’re not always lockstep in military sense. So, this is the new normal for Australian politics.
GILBERT:
Let’s look at a few other big issues around the Budget just a few days away. The spending versus inflation challenge. It is a balance. We’ve been talking about it for many days now. But is the federal government in some respects hamstrung as well by what the states are doing shovelling out money right now?
LEIGH:
Well, the way I think about the Budget, Kieran, is that it’s careful in dealing with the inflation challenge. It’s considered in looking to bring down that trillion dollars of Liberal debt we inherited. And yet it’s also courageous in making important changes around the stage 3 tax cuts which will ensure that four‑fifths of Australians get a larger tax cut than they would have done under the former government. We’ve made decisions which will benefit teachers, nurses and social workers through those prac placements. And 3 million people with student debts will benefit from the changed indexation arrangements. So, there’s a number of targeted measures here, all aimed at dealing with the cost‑of‑living challenges and ensuring that the Reserve Bank has the maximum room to move.
GILBERT:
You are an economist, a very well trained economist, the Treasurer, says in his language, this won’t be scorched earth austerity in this budget, but I ask you, should it be a contractionary one?
LEIGH:
Well, we’ve made significant changes, Kieran, since we came to office. That trillion dollars of Liberal debt has been reduced by $150 billion, which means net debt will peak about 10 percentage points lower than it would have otherwise have done. That’s as a result of us banking a lot of the revenue upgrades. Our predecessors banked about 40 per cent of revenue upgrades. We banked closer to 90 per cent of revenue upgrades.
GILBERT:
But that doesn’t mean it’s a contractionary budget. It’s a little technical, but economists say right now that’s what the RBA wants to see.
LEIGH:
Well, we’ve delivered one surplus, the first in 15 years and we have another surplus in sight. So, that’s important for the Australian economy to be getting to the stage where reducing those interest bills. We know that one of the big 5 pressures on the Budget is that interest spending. Those interest payments by Australians will be significantly lower as a result of the responsible decisions we’ve made.
GILBERT:
On the supermarket inquiry, the Senate inquiry, the first of 6 reports to be released on this issue. There was not agreement on the issue of breaking up the monopolies or the duopoly. You’ve said this to me before, that these laws, where they’re in place internationally, aren’t used very often. But doesn’t the threat of divestiture have an impact on behaviour?
LEIGH:
If it’s never used, it’s unlikely to have an impact on behaviour.
GILBERT:
Even if it is hanging over their head?
LEIGH:
Well, in the United States, for example, it hasn’t been used in a major case in decades. The Hilmer Review, the Dawson Review, the Harper Review didn’t recommend divestiture. The National Farmers Federation have argued against it and the Australian Council of Trade Unions have raised concerns. We need to make sure in this area, Kieran, we’re not doing things just because they feel good, but actually things that’ll make a difference for consumers. And that’s why we’re implementing the quarterly price monitoring by CHOICE. Moving to look at Craig Emerson’s recommendation of a mandatory code of conduct and food and grocery sector. And the work we’ve asked the ACCC to do around supermarket competition. All of those are targeted at making a difference for consumers and getting a better deal for farmers.
GILBERT:
On to the issue of the Palestinian protest, Dennis Richardson, the esteemed public official, probably the most respected in our nation’s history, is a former ASIO boss, among many other achievements in his career. He said to Josh Frydenberg in a Sky News documentary that ‘from the river to the sea’ is a very violent statement. The Prime Minister reiterated that he was asked by Mr Frydenberg about that. He said, ‘Well, it is.’ And he says he agrees that it has no place on our streets. What’s your read on this discussion right now, which remains one where there are some very strong opinions around this country as well?
LEIGH:
Well, the Prime Minister is absolutely right and we need to make sure that we have peaceful protest but not hate speech. You can be pro‑Palestinian, pro‑Israeli and pro‑peace, and that’s certainly the view that we take. We have been very clear in our concerns about the incursion into Rafah that the Israeli government is currently planning. We’ve also been very clear about the importance of ensuring that there is a good partner for peace on the Palestinian side.
GILBERT:
And on that specific language?
LEIGH:
I agree with exactly what the Prime Minister has said there.
GILBERT:
Okay, Andrew Leigh, big week ahead.
LEIGH:
Absolutely. Thanks, Kieran.