20 September 2023

Doorstop interview, Sydney


Subjects: OECD report, global economy, PwC, consultation on draft legislation to strengthen tax system, ACCC report on gas, Employment White Paper, inflation, cost-of-living relief and safety net changes


Overnight, we saw an important contribution from the OECD. What this shows is that the global economy is unpredictable right now and that will have consequences for Australia. We do expect this global economic uncertainty to slow our own economy in combination with the higher interest rates, which we have seen already impacting on consumption in particular, and the economy more broadly. When the global economy is unpredictable as it is right now, it's especially important that we take the most responsible approach to economic management – and we are. There is always a premium on responsible economic management, but particularly when the global conditions are unpredictable as they are right now. We are getting the budget in much better nick, we are making our economy more resilient, at the same time as we roll out billions of dollars in cost-of-living assistance in a way that doesn't add to our inflation problem. Our economic plan is making welcome progress but we know, we are realistic, about what the next 12 or 24 months might bring and the OECD report goes to that as well.

Today, we've also put out for consultation, the next steps in our response to the PwC matter. We understand that Australians are justifiably filthy about what happened at PWC and today we are responding. What this is all about, it's about empowering our regulators, it's about cracking down on bad behaviour and it's about increasing penalties. We want to make sure that what happened at PwC doesn't happen again. We want to be able to consult the private sector when it comes to changes which impact them, and in order to do that we need to rebuild trust and confidence that that consultation is treated the right way. This is another really important part of our crackdown on the behaviour that we saw at PwC. We don't want to see it happen again and that's why by empowering our regulators and increasing penalties and cracking down on dodgy behaviour, we can try to avoid a repeat of what we have seen.

Also, today, we saw the ACCC report on gas. We're really pleased to see the ACCC expect that there will be sufficient supply at the start of next year in the gas market at the same time as our exports increase as well. This is a really important part of our energy mix and it's a really important part of our economy and it also shows that the government's energy plan is working. The Opposition said when we brought in the energy relief plan to take the pressure off small businesses and households – they said that it would threaten supply. And the ACCC has said today – that is of course complete rubbish. The ACCC is expecting sufficient supply next year, we're also expecting exports to grow. That's good for our economy and good for the budget at the same time. It beggars belief that the Liberals and Nationals voted against a plan which is taking some of the edge off power prices, at the same time as it's ensuring we're getting enough supply next year, in the ACCC's estimation.

The final thing I want to touch on is the Employment White Paper which we'll be releasing on Monday. This is all about making sure that our labour market is as dynamic and as inclusive as it can be. We want to make sure that there are more jobs and more opportunities for more people in more parts of the country – and that's what the Employment White Paper is all about. We want to make sure that Australian workers are beneficiaries of the changes that we're seeing in our economy in our society, not the victims of that change, and that will be a key focus of the Employment White Paper. The Employment White Paper is about five things – it's about full employment, it's about job security and decent wages, it's about filling skill shortages, it's about making our economy more productive by investing in people, and it's about trying to deal with the barriers which are preventing people from finding work even when national unemployment has been especially low. Our labour market has proven to be really resilient but we're not resting on our laurels. This is all about the labour market that we need for the future so that our people can grab the opportunities of an economy like ours.


The OECD report predicts a slowing global economy, so higher inflation here. What's your message to Australian consumers?


Well, we are expecting more global economic turbulence and that will impact on us here in Australia. The pressures that are being felt around the world are being felt around the kitchen tables in Australia as well, and we understand that. The government's highest priority is rolling out billions of dollars in cost-of-living relief in a way that takes some of the edge off this inflation rather than add to it. We've seen some welcome progress when it comes to inflation moderating but it's still higher than we'd like and it will be for longer than we would like, and so we remain vigilant about that. We go into this new period of global economic uncertainty from a position of genuine strength. Our labour market's been resilient, inflation is moderating, we've got the budget is much better nick, and all of those things put us in good stead as we face the global economic uncertainties ahead.


Oil prices are at a ten month high and the combination of El Nino declared yesterday – how serious or how worried are you about a reacceleration of inflation, or at the very least, that inflation will stay higher for longer?


We are vigilant about inflation. Our primary goal here is to see inflation moderate. That's why we've got the budget in much better nick, that's why we're rolling out this cost-of-living help in a way that takes the edge off inflation rather than add to it. That's why we're dealing with issues in the housing market, in the energy market, with out of pocket health costs and elsewhere as well. We need to remain vigilant because inflation is still too high, even as it’s moderating. We recognise it's still putting people under extreme pressure. There are lots of risks in our economy, whether it's global and domestic right now, we're vigilant about that. We're managing the economy in the most responsible way possible, and we're making some progress but not resting on our laurels.


Given that inflation is so high, welfare payments increased today, is it enough?


We found a way to get the budget into a substantial surplus at the same time as we help people with cost-of-living pressures. We haven't had to choose between getting the budget in better nick, or providing help, especially for the most vulnerable Australians on social security. And we are pleased that we've been able to get the budget in better nick, at the same time as we provide these increases in social security payments, whether it be JobSeeker or rent assistance. These are important ways that we help people deal with the pressures that they confront. Thanks very much.