Ashleigh Raper:
Hello Treasurer, and welcome.
Jim Chalmers:
Thanks very much Ash.
Raper:
Is this the Budget you didn’t want to do?
Chalmers:
I’m looking forward to delivering a Budget on Tuesday night. It’s a Budget which is all about the cost of living, but also making sure our economy is more resilient in the face of all this global economic uncertainty and one way that we can build the future of our economy and our country.
So, I’m looking forward to handing it down. I know that cost‑of‑living pressures are front of mind for most Australians and cost of living will be front and centre in the Budget.
Raper:
So, in this Budget, you are promising to extend the energy bill rebate before the end of the year. So, an extra $150 off bills. What’s the rationale behind it? How did you arrive at the extra 6 months?
Chalmers:
The broader rationale is that even with the progress that we’ve made together as Australians on inflation, we know that people are still under pressure so we’re helping where we responsibly can. Strengthening Medicare, because more bulk billing means less pressure on families making medicines cheaper, as the Prime Minister announced in the last few days.
But also extending these energy bill rebates, we know that they have played an important role in taking some of the edge off cost‑of‑living pressures. This is more hip pocket help for households. It’s about recognising that even with all that progress on inflation, Australians are still under pressure and we’re responding to it.
Raper:
Is it a mistake for Labor to promise to lower electricity bills by $275 in the lead up to the last election? And has that plagued you and you’ve had to deal with that throughout this term?
Chalmers:
I’m not going to get into the political analysis of that. We’ve been working around the clock to ease cost‑of‑living pressures despite the opposition of the Liberal and National parties.
Raper:
But do you concede it’s a broken promise, essentially?
Chalmers:
We’ve been working around the clock to take pressure off household energy bills. You asked me about $275. We took $300 off last year. $300 for a lot of Australians the year before, at the same time as we’re introducing more cleaner and cheaper, more reliable energy into the energy grid.
So, I know that there’s a lot of focus on that. There’s a lot of focus from the government in taking the edge off these electricity bills. That’s what this announcement that we’re making today to extend energy bill release for another 6 months is all about.
Raper:
Last week we said there’d be few surprises because you’ve already made some promises in the lead up to the Budget. You’re also going to keep some for the campaign. Is this energy bill extension the only new cost‑of‑living relief we see this budget week?
Chalmers:
No, there’s also cheaper medicines, making the medicines on the PBS substantially cheaper.
Raper:
That was last week, I’m saying this week.
Chalmers:
There’s a real focus in the Budget on cost of living. We’re cutting student debt, it’s about cost of living. We’re strengthening Medicare because more bulk billing helps address some of these out‑of‑pocket health costs. We’re making medicines cheaper, we’ve got big new investments in women’s health and we’re extending the energy bill rebates.
And again, this is because we understand that cost of living is still front of mind for Australians even with all this progress on inflation. Cost of living is front and centre in the Budget and that’s why we’re making these investments.
Raper:
One of your favourite sayings to get a sound bar is that you turn Liberal deficits into 2 Labor surpluses. We’re now going to get a Labor deficit. How are you going to explain that to voters?
Chalmers:
It remains the case that we turn 2 enormous Liberal deficits into 2 Labor surpluses. The first government in almost 2 decades to deliver those back‑to‑back surpluses. But even this year where we do expect a deficit, it is much smaller than what we inherited from our predecessors. That’s because one of the defining features of this Albanese Labor government, has been responsible economic management.
We’ve helped engineer the biggest improvement in the Budget in a single term of any government ever in dollar terms. That means less Liberal debt and less interest being paid on that debt. It helps make room for us to provide this cost‑of‑living help to invest in the future and make our economy more resilient at a time when there is a new world of uncertainty around the globe.
Raper:
But you are doing a lot of extending. The energy rebate extension, the $8.5 billion incentives for Medicare, bulk billing. There’s been billions for roads, rails. Are there any savings in this Budget?
Chalmers:
There are savings in the Budget, but it’s also important to remember that most of the announcements that we’ve made between the mid‑year budget update and now have been already provisioned for in that mid‑year budget update. For example, the announcement we’re making today to extend the energy bill rebates, was provisioned in the mid‑year budget update in December about 3 months ago.
So, we are managing the economy and the budget in the most responsible way that we can. We’re making these investments, but also making room for these investments by banking up or provisioning the revenue over our time in office, delivering those surpluses in our first 2 years, finding savings where we can so that we can fund this cost‑of‑living relief and these key investments.
Raper:
So, has revenue like a bump in income tax, is that what has helped fund some of these units?
Chalmers:
There’s a very small increase in revenue in the Budget as a consequence of all of the factors, but much, much smaller than we’ve seen in earlier years – and that will all be detailed on Tuesday.
Raper:
Has the US President Donald Trump kept you up at night as you prepare this Budget?
Chalmers:
Well, certainly the escalating trade tensions around the world have been a big concern for us. What we’re seeing out of DC but also out of Beijing, 2 major conflicts, political uncertainty, and division around the world. All of that is casting a shadow over the global economy and over our Budget.
The 2 big influences on the Budget as we put the finishing touches on it, have been cost‑of‑living pressures and global economic uncertainty – so we are concerned about it. We’re a very trade exposed economy. We’ve got a lot of skin in the game when it comes to these escalating trade tensions. That’s why a big focus and a big priority of the Budget is to make our economy and our communities and our workers more resilient in the face of all these external shocks.
Raper:
Has it changed any of the forecasts or expectations in this Budget?
Chalmers:
It’s certainly changed the expectations. Some of the forecasts have been updated and some of them are broadly the same. But in the language of the economists, they talk about the risks being tilted to the downside.
What that means is even where we’ve left forecasts, broadly where they were in terms of American growth, for example, there are a lot of risks that that could get worse rather than better. A lot of economists have identified that risk.
Raper:
Now, the Albanese government has long talked about wanting to build a universal early education system. As the numbers person, the money man, is this feasible? Can it be achieved in the next term or beyond?
Chalmers:
It can certainly be achieved and that’s our aspiration, that’s our objective. But you need to get there in incremental steps, big incremental steps, and that’s what we’re doing.
The 2 big announcements we’ve made on early childhood education, the 3‑day guarantee, for example, but also the new money to build new centres, non‑profit centres, in areas where there’s a deficiency or shortage of early childhood education. These are really big, really important steps towards universality.
The Prime Minister, the Ministers, myself and others, we are huge believers in the transformational, transformative impact of early childhood education. We think it’s a game changer for families and for children and for our country more broadly. That’s why we’ve been such enthusiastic, multi‑billion‑dollar investors in getting closer and closer to universality.
Raper:
The government makes a lot about the gender parity for those sitting around the cabinet table, those in the Labor caucus, and how important it is to have women around the table and what it leads to, the decisions. Is there anything new specific for women in this Budget?
Chalmers:
We made it very clear that there’s a big game changing investment when it comes to women’s health. One of the things I’m proudest of in this Budget is the work that Katy Gallagher and Mark Butler and Ged Kearney and other colleagues have done to make these huge investments in women’s health in areas that have been neglected for too long, frankly. That’s one of the most important things that we will fund on Tuesday night.
The announcements that we made on women’s health, we’re very proud to do that in addition to everything else we’re doing to get women’s wages moving again to fund pay increases in industries dominated by women, investments in women’s safety. A very big and central priority of this government and this Budget is to do the right thing by the women of Australia. I think where people will notice that most substantially is when it comes to women’s health.
Raper:
This is your fourth budget. Has it got easier or harder over this term in terms of identifying your priorities?
Chalmers:
I think the priorities are clear. We’ve never had a problem identifying priorities. Cost‑of‑living help, Future Made in Australia, lifelong learning and education, strengthening Medicare. Our priorities have been clear, and our priorities have been validated and indicated by the progress that Australians have made together. So, the priority setting is easy. Making it all add up is more difficult. Each budget has got its own share of challenges, and this has been no different.
Raper:
Do you think you’ll be delivering a fifth budget?
Chalmers:
That’s up to the voters. It remains to be seen. I don’t take any outcome in any election for granted, least of all this one. It will be tightly contested; it will be close.
I hope that the economy is front and centre in the election contest because it’s really a choice between Labor helping with the cost of living and with a substantial detailed economic plan in the Budget versus the Coalition who have secret cuts that they won’t come clean on and won’t tell people what that means for Medicare or pensions and payments. That’s a choice at the election.
The stakes at the election are really high, and that’s because the stakes in the economy are really high. We’ll be setting out our plan in detail with dollars attached. It’s time for our political opponents to come clean on their cuts and how much worse off people will be as a consequence.
Raper:
Treasurer, thank you.
Chalmers:
Thanks, Ashleigh.