CHARLES CROUCHER:
Treasurer, welcome. The centrepiece of this Budget is the tripling of incentives of bulk billing. How would that work?
JIM CHALMERS:
Well, for 11.6 million Australians, our broader Strengthening Medicare package will make it easier and cheaper to see a doctor. One of the big concerns we have is how hard it is to find a bulk billing doctor. It's a big driver of cost‑of‑living pressures if you can't find one that bulk bills. So, we're tripling the bulk billing incentive. It has an even bigger impact in the bush than in the cities. But right around Australia, a really important initiative, and you're right to say one of the big new centrepieces in the Budget tonight.
CROUCHER:
It's incentivised to pensioners, to children, to concession cardholders. Will it help every Australian get to see a doctor and get to see a bulk bill doctor or just those people?
CHALMERS:
Well, what we want to do is we want to encourage more doctors to bulk bill and we'd like them to bulk bill right across the spectrum. But I think in this initiative, what it does is it incentivises those groups that you mentioned. But there's broader Strengthening Medicare initiatives in the Budget too. There's more than $5 billion in a tight Budget invested in Strengthening Medicare. The tripling of the bulk billing incentive is part of that, but not all of it.
CROUCHER:
One of the other big, effectively cost‑of‑living measures is this Rent Assistance increase 15 per cent. How do you stop rents not just going up 15 per cent in response?
CHALMERS:
Well, one of the reasons why rents are going up is we don't have enough properties. Vacancy rates are really low, rents are really high. You can see in the Budget that that is a big driver of inflation in our economy. And so what we've tried to do is to take some of the sting out of that. We expect it to make a meaningful difference to people. Obviously, we don't want to see that passed on in higher rents. But the fact that we've got higher rents is really a supply problem. It's not because Commonwealth Rent Assistance is too generous. We've made it a little bit more appropriate to the kinds of pressures that people are facing.
CROUCHER:
I agree with you. It's a supply problem. This doesn't help supply.
CHALMERS:
No, but it helps people deal with these increases in rent that people are seeing. We understand that one of the big price pressures in our economy is rent. That's why we want to build more properties with the Housing Australia Future Fund, the Housing Accord and in other areas. But in the meantime, we've got to make things a little bit easier for people in the rental market, take some of this sting out of these high rents.
CROUCHER:
Let's go to JobSeeker ‑ $20 extra a week. Is that enough to see people, firstly, come out of poverty and secondly, go into a job?
CHALMERS:
Well, this is a meaningful improvement in the base rate of JobSeeker. But I understand there's always people who say don't do anything. There will be groups who say that we should be doing more. And I respect all of those opinions right across the spectrum of views. What we've tried to do here is strike a good balance. We tried to provide a bit of extra assistance for the people doing it toughest, including people on JobSeeker and the related payments, students and others ‑ $40 a fortnight. It's what we can afford. It's what is responsible. And we hope that, again, it helps a little bit with the cost‑of‑living pressures that people are facing.
CROUCHER:
They're the big initiatives in the Budget for cost‑of‑living, or some of them. The big threat remains inflation. The forecast is for that to almost halve over the next 18 months. Are you confident you can do that? And if so, how do you do that without interest rates going up?
CHALMERS:
We are confident that inflation is moderating in our economy, but not fast enough. It's higher than we'd like, for longer than we'd like. It's persistent in our economy, and that's driven a lot of our decisions. Whether it's the nature, the targeting, the size of our cost‑of‑living package, our investments in growing the economy, the restraint that we showed in spending in the Budget, all of those things are about inflation. We want it to moderate so we can get that real wages growth again in our economy, and so that we can take some of the pressure off people, which is really the kind of defining motivation of this Budget. Take the pressure off where we can.
CROUCHER:
Yeah, you talk about pressure, you talk about real rages growing. My concern is for those people that don't qualify for any of the assistance that you've paid. There's a lot of taxpayers out there that are going to look at this Budget and say, things are still tough for us. We've got this guarantee that in six months, eight months, 12 months’ time, things will get easier. What do you say to them?
CHALMERS:
There's a whole range of measures beyond what we're doing for the most vulnerable ‑ cheaper early childhood education will be a game changer for middle Australia, for example, that comes in on 1 July. Our Strengthening Medicare agenda that we were talking about a moment ago is not about how much you earn ‑ 11.6 million Australians will benefit from Strengthening Medicare. We've got initiatives for low interest loans to make your home more energy efficient so you can get your bills down. There's a whole bunch of ways that we are helping middle Australia in this Budget, but we are prioritising when it comes to JobSeeker and Rent Assistance the people who are on the lowest incomes -
CROUCHER:
Because that's where this balance comes in, right? If you can't get inflation down, and while you're doing that while increasing payments and seeing wages go up, I mean, what happens if that doesn't work out? Because it's those people that will be punished.
CHALMERS:
We don't have an inflation problem because wages are growing too quick and we don't have an inflation problem because people on payments are getting too much. That is obviously very clear. Inflation problem from the war in Ukraine, supply‑side issues in our own economy ‑ they have been clear. And so what we've done with this package ‑ we've targeted it, we've made it responsible over a period of time and that's because our cost‑of‑living package is designed to address cost‑of‑living pressures, not add to them.
CROUCHER:
Really quickly because we are short on time. There's billions in this for COVID still. Will that include a Royal Commission?
CHALMERS:
We haven't come to a concluded view on that. We've had other priorities when it comes to COVID, but we have had to extend COVID programs and obviously we need to do that. COVID is still a feature of our health landscape, still a feature in our communities, and so we still need to fund measures to address it.
CROUCHER:
I asked you last time about this, I asked you on Sunday about this, about when it will get easier. The Budget seems to think it starts to get easier from a month or two months’ time. Is that what you're hoping or what you're seeing?
CHALMERS:
Well, our objective is to try and make life a bit easier for people who are confronting these cost‑of‑living pressures that are putting them under the pump. Really, the defining objective of this Budget is to try and take some of the edge off these cost‑of‑living pressures to make life a little bit easier for people at the same time as we lay the foundations for future growth. I'm proud of what we've been able to do here because it's a responsible Budget. We are now forecasting a return to surplus this year and smaller deficits after that. But even within that responsible framework, we're still helping people with cost‑of‑living pressures, we're still investing in growth in the economy and that means extending and broadening opportunities for more people. And that's our objective, that's why we're here.
CROUCHER:
You mentioned the return to surplus. Last question, because you were a student of politics and the history of these things. It was about 35 years ago, almost to the week, that Paul Keating decided here was the Budget that would bring home the bacon. It doesn't seem like this is one that brings home the bacon, but is this the start of a reform and a change of the way you approach the Budget, the way Australia approaches the Budget and the way we start paying back some of the debt?
CHALMERS:
Oh, absolutely. We are showing in this Budget really important progress. In October we did, and in May we're putting the Budget on a much, much more sustainable footing. And I don't see that as an end in itself. I see it as the foundation upon which we do things for more people. We create more opportunities, we grow our economy and we make the right investments in the future. So, I'm proud of where we've got the Budget to, but there's more work to do. I don't think this is the end of a process. Budgets are always kind of staging points of progress rather than just moments in time. And I'm pleased with the progress that we've made here because we've been able to help people invest in the future at the same time as we put the Budget on a much more sustainable footing.
CROUCHER:
Treasurer, congratulations on Budget number two and thanks for your time.