JIM CHALMERS:
Good morning, another budget day. We know that people are doing it tough and that’s why there’s more help on the way in this Budget. This will be a responsible budget which eases cost‑of‑living pressures and fights inflation, and invests in a Future Made in Australia. The cost‑of‑living relief in this Budget will be substantial and it will be responsible.
There will be a tax cut for every taxpayer and there will be more help, to help people make ends meet. This Budget will be responsible. It will put people front and centre. It will help all Australians to deal with the pressures that they’re under in the here and now, at the same time as we invest in the future. A tax cut for every taxpayer and more help to make ends meet.
There’ll also be substantial investments in more homes for Australians. In strengthening Medicare and the care economy, in reforming universities and boosting our skills base and investing in the jobs and industries which will power our future. The defining feature of the Albanese government is responsible economic management and the defining feature of the Budget tonight will be responsible economic management as well. The second surplus that we are forecasting in the Budget is a demonstration of that responsible economic management.
The second surplus is not an end in itself. It’s a demonstration that we’ve been able to get the budget in much better nick so that we can make room for our priorities, including easing the cost of living and investing in a Future Made in Australia. A second surplus is not an end in itself. It’s an important way that we make room to help people and to invest in the future of our communities and our economy as well. A second surplus would be the first back‑to‑back surpluses in almost 2 decades. This is a demonstration of the responsible way that we’ve gone about managing the budget. The Budget will put downward pressure on inflation, not upward pressure on inflation. We’ll do that by showing spending restraint, by banking almost all of the upward revisions to revenue this year, by finding more savings in the Budget, and also by making sure that we design our cost‑of‑living help so that it’s part of the solution to this inflation challenge rather than part of the problem. The primary focus in this Budget is cost of living and fighting inflation, but we found a way to do that at the same time as we invest in the future. Over to you.
JOURNALIST:
Is the second surplus based on commodities and income tax an economic celebration or a political one?
CHALMERS:
A second surplus is a demonstration of our responsible economic management. The primary driver of this second surplus is actually the way that we’ve been able to ensure that the labour market has stayed remarkably resilient. The biggest driver of this second surplus is not commodity prices, it’s the resilience of the labour market. Commodity prices have made a more modest contribution, a welcome contribution, but a more modest one on this occasion. But what matters is when you get these revenue upgrades in the Budget, and this one is only a sliver of what we’ve seen in years past, what matters is what you do with that. We are banking almost all of it this year. That is the reason why we’re forecasting this second surplus. To land a second surplus would see the first back‑to‑back surpluses in almost 2 decades. That’s a demonstration of a defining feature of this government, which is responsible economic management.
JOURNALIST:
Economists warn interest rates to remain high for longer if you get the balance on inflation wrong. Are you feeling that pressure?
CHALMERS:
Pressure is a privilege is the first point that I would make about that. But this Budget is all about putting downward pressure on inflation, not upward pressure on inflation. And you’ll see that in the inflation forecast that you’ve had a look at in the course of the last couple of days. This Budget will be part of the solution when it comes to inflation, not part of the problem. The future trajectory of interest rates is decided independently by the Reserve Bank and its board. The Budget has a role to play in fighting inflation, but it’s not the only determinant of that future trajectory.
JOURNALIST:
For people on the lowest incomes, pensioners, people on unemployment payments, for instance, they won’t get much help out of the tax cuts. Will there be any extension of those payments, any one‑off payments, for instance, for people on those sorts of incomes?
CHALMERS:
Yes. I say to people who are doing it tough and to the most vulnerable people in our community, that help is on the way in the Budget. The tax cuts are the biggest part of the cost‑of‑living relief in the Budget, but not the only part of the cost‑of‑living relief in the Budget. Our big priority here is to put the people front and centre. We know that people are doing it tough and that’s why more help is on the way tonight.
JOURNALIST:
Treasurer, is it time for Labor to roll out the Back in Black mug?
CHALMERS:
I roll a bit differently to my predecessor. I try and spend a bit more time on the actual budget and explaining it to people rather than flogging Back in Black mugs. I think that that, frankly, has been humiliating for the Liberals and Nationals. I take a pretty conservative and pretty cautious approach to these kinds of things. But if, in the event that we get this second surplus and we are forecasting it, we are expecting it, that would be the first time that that has happened back‑to‑back in almost 2 decades. That’s not an end in itself. It’s not necessarily a cause for celebration, it’s a demonstration we’ve been able to get the budget in much better nick, and not at the expense of helping people or investing in the future but in addition to helping people and investing in the future.
JOURNALIST:
Treasurer, using cost‑of‑living subsidies to lower headline inflation was labelled a political trick by Warwick McKibbin, doesn’t address underlying inflation pressures. What’s your response to that?
CHALMERS:
Opinions are pretty thick on the ground at this time of year, and my job is not to make opinions, my job is to make a difference and to make it all add up. I’m obviously conscious that there are a range of views about budgets, that’s as it should be. You read those in the papers from time to time. Our view, and our advice, is that the combination of cost‑of‑living relief that we are providing in this Budget, will put downward pressure on inflation and not add to broader inflationary pressures in the economy. I acknowledge that Warwick has a different view. I don’t agree with it.
JOURNALIST:
Treasurer, what about further tax relief such as LMITO, would that also help inflation while helping people on the lowest incomes?
CHALMERS:
We’ve found a more effective way to help people who are doing it tough. The LMITO was legislated to end by my predecessor, and it ran out on the schedule that he determined in his last budget. We have found more effective ways to give a tax cut to every taxpayer, an average tax cut of 36 dollars a week. In addition to other cost‑of‑living help in this Budget, which will help people make ends meet.
JOURNALIST:
Treasurer, what’s in this budget for northern New South Wales?
CHALMERS:
What you’ll see in the Budget is a really enthusiastic commitment to investing in communities right around Australia. Now, this is a budget for real people, in real communities doing it tough. It’s about investing in those people, in those communities and those local economies. If we want a strong national economy, we need to make sure that important local communities and economies like the north coast of New South Wales are supported and you’ll see that in the Budget.
JOURNALIST:
You said before that inflation is a priority but not the sole priority going to the Budget. Why not, given the cost‑of‑living pressures facing households? And is inflation the ultimate test of the Budget, the impact it has over the next couple of years?
CHALMERS:
I’ve said a number of times that the primary focus of the budget is this inflation fight and helping people with the cost of living. That is the primary focus, overwhelmingly of the budget, especially in the near term when those inflationary pressures are most acute. We are asked to strike a series of fine balances in this Budget primarily cost of living and fighting inflation, but also making sure that we’re strengthening Medicare and building more homes, reforming our universities, and strengthening our skills base. There are a number of tasks in this Budget, but none are more important than the inflation fight and easing the cost of living. What you’ll see in the Budget and in the forecast is this Budget will be part of the solution to inflation rather than part of the problem. The Budget will put downward pressure on inflation, not upward pressure on inflation.
JOURNALIST:
Energy bill relief and rent relief for people who are already on Centrelink payments. There are so many Aussies that are doing it tough, but they’re not at that level. Are you doing enough for those people?
CHALMERS:
What you’ll see in the Budget tonight is help for everyone to make ends meet.
JOURNALIST:
Not $37 a week, not the tax break. What else might be in there?
CHALMERS:
I encourage you to have a very careful look at the cost‑of‑living package that’s in the Budget. There are some assumptions about that cost‑of‑living package which may or may not turn out to be right. I encourage you to check it out. More importantly, I say to the Australian people, we know that you’re doing it tough. More help is on the way in the budget. That cost‑of‑living relief will be substantial, but it will be responsible. And in this Budget, the people of Australia, all of the people of Australia will be front and centre.
Thanks very much.