Cenatiempo:
Let’s talk federal politics with the Assistant Minister for Competition, Charities and Treasury, and the Member for Fenner, Andrew Leigh. Good morning.
Leigh:
Good morning Stephen. Happy Budget day!
Cenatiempo:
Well look, I’ve got to say I hate Budget week Andrew, but I thank you anyway, I want to ask you something – your role as Assistant Minister for Treasury. What does that mean? How does that tie into the overall Treasury, Treasurer, finance portfolio, et cetera.
Leigh:
I’m part of the Treasury economics team, and I have particular responsibility for the issues of competition, multinational tax, for the Mint and for the Australian Bureau of Statistics.
Cenatiempo:
Okay. Now the Budget will be handed down tonight. Now pox on both your houses. I mean, this is going to be a cash splash which all budgets leading into elections are, and the Opposition has basically said they will match every dollar. Isn’t it time for some responsible economic management rather than just throwing cash around that we don’t have?
Leigh:
Well Stephen, in less than 3 years we’ve reduced Liberal Party debt by $177 billion.
Cenatiempo:
Well, it’s not Liberal Party debt. Stop saying that. But okay, you say you’ve reduced debt. Okay.
Leigh:
This is compared to what they were forecasting in their last budget and what we’ve achieved. We turned 2 big Liberal deficits into 2 Labor surpluses. We shrunk this year’s deficit. We have made huge reprioritisations and savings. Some $95 billion of reprioritisation savings over the last term.
Cenatiempo:
The vast majority of that turnaround has been receipts that the government wasn’t anticipating, so you can’t take credit for that?
Leigh:
Well, the reprioritisations and savings are government decisions, and that $95 billion compares to zero in the Liberals’ last budget. So we’ve made tough decisions, and some of that has involved curtailing the use of consultants and contractors, which Canberrans will know is a much more expensive way of doing things. We had that shadow public service workforce of 50,000, rather than having properly trained public servants doing their jobs. We’ve managed to get down the wait times for Veterans Affairs, and we’ve managed to ensure that we have the public service as a steward of the nation’s finances.
Cenatiempo:
Yeah, I’m sure that resonates here in Canberra, but I don’t know that it resonates in the rest of the country Andrew. But I want to talk about this latest cash splash, an extension of $150 of this energy rebate. There has been no attempt from the government to actually fix the underlying problem, and that is the cost of electricity. All you’re doing is giving us our own money back to pay electricity bills that you’ve made higher.
Leigh:
Well, I think Canberrans know the benefits of having renewable energy, given that we’re 100 per cent renewable energy.
Cenatiempo:
Well, we’re not. That’s again, again that’s another lie but anyway. I’m not saying you’re perpetrating that lie, because it’s something that we just tend to throw around when we know it’s not true.
Leigh:
Stephen, it is a fact that the ACT is 100 per cent renewable energy.
Cenatiempo:
Well hang on, hang on Andrew. Andrew, no, no, I’m going to stop you there because I hate it when people say this. We produce 5 per cent of our own electricity. Ninety-five per cent comes from across the border, and of that 95 per cent somewhere between 70 per cent and 80 per cent is made from fossil fuels. We do not have 100 per cent renewable electricity in Canberra, full stop.
Leigh:
We have always relied on electricity from New South Wales. We choose now to draw it from renewable sources in New South Wales and the ACT.
Cenatiempo:
You can’t make that determination. You just, that’s just something you say.
Leigh:
No, this a fact. And what that meant was when you had the overseas crisis which drove up gas prices, the ACT wasn’t affected by that in the way that other jurisdictions were.
Cenatiempo:
Well, my electricity bills going up.
Leigh:
By moving to renewable energy, we’re able to make ourselves less dependent on global crises. Alongside the renewable energy rollout, we’re delivering energy bill relief. This energy bill relief will continue for another half a year, and Canberrans will see it taken directly off their bill.
Cenatiempo:
But Andrew, this is the point. It’s not energy bill relief. The energy bills are still what they are, and they’re still rising. You’re just giving us back our own money to cut a little bit off the top.
Leigh:
Well, what people are going to see very clearly Stephen, is that $150 in rebates automatically applied to their energy bills in quarterly instalments. I think that’s going to be pretty important for many Australians.
Cenatiempo:
Why should I subsidise your electricity bill by $150 Andrew?
Leigh:
Well, we’re not the only sources of revenue Stephen. One of the things the Albanese government has done is focused on multinational taxation, making sure multinationals pay their fair share. That is one of the sources of government revenue which goes into paying these energy bills.
Cenatiempo:
But my point is, you as a well‑paid public servant, don’t need the $150 – yet those Canberrans that desperately do need it are subsidising, to an extent, your $150.
Leigh:
Yeah, I mean we certainly looked at targeted ways of doing this. It turns out that the cost of targeting can be bigger than the benefits. In this case, flat energy bill relief provides a straightforward, simple way of doing things and ensures that every Australian is getting energy bill relief, just as every Australian income taxpayer got a tax cut last year.
Cenatiempo:
I just, you know it seems to me that you know when fiscal, economic management is the order of the day, all we’ve seen is the Prime Minister stand up for the last 2 weeks and promised to throw a billion dollars of this, billions of these, billions of that, billions of that. It’s like an Oprah Winfrey Show.
Leigh:
I guess what people aren’t seeing are those savings and reprioritisation that we talked about before. Those are demonstrated in our first 2 surpluses and in a much smaller deficit this year than the one we inherited. Those are the quiet decisions that have been made that underpin this Budget. The responsible economic management that we’ve put in place very careful reprioritisations and savings, infrastructure portfolio and public service and a whole range of other areas. Now we came into office after sports rorts, the car park rorts, with so much wasted. Waste and mismanagement under JobKeeper – $20 billion going to firms with rising revenue.
Cenatiempo:
And at the time, you supported all that but yeah.
Leigh:
I was a vociferous critic of the JobKeeper rorts and waste, saying very clearly that we shouldn’t have been giving JobKeeper to firms with rising revenue. $20 billion out the door through that one decision alone, I was very critical of the sports rorts, very critical the car park rorts. I’m on the record on most of those things while the former Morrison government was in office, and that’s what’s changed.
Cenatiempo:
But hang on. When you say rorts – you use the term rorts and I’m going to pull you up on this, because rorts means anything the other side does if we do it, it’s responsible. That’s the reality of it. So you know, you use these terms, and it’s just pure politicking Andrew. We’re not talking about reality.
Leigh:
We had an Auditor‑General report very clearly casting at the former government over sports rorts. A Minister resigned over that Stephen. This was a very clear rort. I don’t think rorts come much clearer than when a Minister says I’m stepping down because I’ve done the wrong thing. And the Auditor‑General says this is outrageous.
Cenatiempo:
Well, yeah. Okay, alright. I want to read something to you for a moment. This is from a report that’s been done by the Vice President of Crestview Strategy here in Australia in a pre‑budget reflection. She says ‘Framed as responsible relief, the package continues Labor’s patent of targeted subsidies and short‑term support. But there’s growing criticism that these handouts while politically popular, do little to address structural issues and may in fact worsen them. As AFR Editor‑at‑large, Michael Stutchbury put it – ‘This is a government that treats voters like mugs with short‑term cash splashes while ignoring long‑term fiscal consequences the promised $275 cut to household power bills from 2022 remains unmet, and this rebate looks more like a political band aid than an economic fix’. You can’t argue with any of that?
Leigh:
We certainly need to be doing both things Stephen. You need to be dealing with those immediate cost‑of‑living pressures and making investments in productivity in the future. The energy investments we talked about are a part of that, but also the investments in better infrastructure around competition. So, the supermarket report that came out last week…
Cenatiempo:
Yeah, which said there was no evidence of price gouging by the way.
Leigh:
…which said very clearly that there were patterns such as high‑low pricing, that margins had increased and that our supermarkets are among the most profitable in the world. It then made a series of recommendations…
Cenatiempo:
Do we want our supermarkets to not be profitable?
Leigh:
We do not need the most profitable supermarkets in the world. I don’t think we need those margins to be rising. They were some of the salient points that the ACCC was making, that the squeeze at the checkout was being matched by an increase in profit margins. And you talk about structural reform Stephen, some of the work we’ve done in competition really is about structural reform because competition is so fundamental to productivity growth which ultimately drives living standards growth. So we’ve had the biggest merger shake up in half a century. We’ve had a whole lot of careful work being done by the Competition Taskforce in order to produce a more dynamic and competitive economy.
Cenatiempo:
Well, some economists would disagree with you there Andrew, but is there anything in the Budget that’s going to come out tonight that we don’t already know about?
Leigh:
Absolutely, there’s always some exciting bits coming out in the Treasurer’s speech. So, everyone should be tuning in at 7.30 to hear Jim stand up and deliver his fourth Budget.
Cenatiempo:
Alright, we’ll be broadcasting that live here on 2CC. Andrew, next time we catch up I think we’ll officially be in an election campaign won’t we?
Leigh:
I think that’s likely, but the Prime Minister will make the decision.
Cenatiempo:
But I mean, he doesn’t have a choice anymore, does he? I mean he’s got to go. Well, I mean the 17th of May is the absolute latest he can go?
Leigh:
We’ll have a May election. The only question there is which Saturday in May it will be.
Cenatiempo:
Righto. Alright, well he’s got to call it sooner rather than later. Andrew, good to talk to you. We’ll catch up in a couple weeks.
Leigh:
Likewise, thanks Stephen.
Cenatiempo:
Andrew Leigh, Assistant Minister for Competition, Charities, Treasury, and the Member for Fenner.