James Glenday:
Treasurer, good morning and congratulations on your fourth Budget.
Jim Chalmers:
Thanks very much, James. Good to be back with you.
Glenday:
We’re going to get to some of the measures in the Budget in a moment but yesterday your colleague Katy Gallagher reminded you to both keep smiling as she stood up for the Budget press conference. I think we’ve got that here.
[Excerpt]
Katy Gallagher:
Keep smiling.
[End of excerpt]
Glenday:
Now, this was a Budget that few expected would actually ever be delivered. Has it been a crazy couple of weeks to get this document delivered?
Chalmers:
Oh, it’s been a busy couple of weeks but we’re proud of the Budget that we handed down last night because it’s all about helping with the cost of living, strengthening Medicare and building Australia’s future.
And one of the most important elements was additional cost‑of‑living relief in the form of tax cuts, 2 more tax cuts to top up the tax relief which is already flowing and the combination of those 3 tax cuts means an average tax cut of about $50 a week.
And that’s all about helping people with the cost of living because we know that’s still a pressure even as we make this really quite substantial progress together getting inflation down.
Glenday:
This latest loss is going to cost about $17 billion and be worth about $5 a week from next year. Who are you targeting in particular with this?
Chalmers:
Well, these tax cut top ups are all about helping people with the cost of living and the 2 together is an additional $10 a week which takes the total to about $50 a week on average.
There will always be an appetite for us to do more, we understand that these are modest in isolation but meaningful when you combine them with the other tax cuts we’re providing as well as all of the other cost‑of‑living relief that we’re providing that you ran through a moment ago.
And what Angus Taylor’s brain explosion about opposing these tax cuts really means as the election is going to be a pretty clear choice and that choice is crystallising between a Labor government which is cutting taxes to help people with the cost of living or Peter Dutton who has secret cuts which will make people worse off, not better off.
And so that’s really the choice at the election. That’s the difference on these tax cuts, what that really means for people who are watching your show this morning.
Glenday:
We’ll be able to ask the Opposition leader, Peter Dutton, about some of those things later in the program. The Coalition and some commentators have suggested that you’re trying to bribe voters with these cuts and some of these measures in the Budget. People can make their own mind up about that. Taken in total, though, reductions in health scripts, tax, things like that, is there a risk that that contributes to inflation over the next year or so?
Chalmers:
No. What the Budget papers make really clear is that what we are proposing and what we are announcing in the Budget last night is consistent with inflation coming down lower and sooner. One of the most encouraging elements of the forecast in the Budget is Treasury now expects inflation to be sustainably within the target band earlier, 6 months earlier than had been anticipated at the end of last year. That’s a very good thing.
And what it shows is in our economy, we’re getting inflation down, we’ve got wages up, unemployment’s very low, we’ve got the debt down, interest rates have started to be cut and growth is rebounding solidly in our economy as well and so our economy is turning the corner. The credit for that belongs to the people of Australia who have been through a lot. We want to help them with the cost of living. Peter Dutton wants to prevent that. Peter Dutton wants to cut everything except for people’s taxes. We’re providing tax cuts in the most responsible way that we can, recognising that people are still under pressure and we’re helping them.
Glenday:
Ok, well, we’re not sure exactly what Peter Dutton is going to do. We’ll ask him next hour. Just on the actual budget books, you’ve delivered 2 surpluses. The Budget now predicts deficits way out into the future. I don’t think anyone was expecting major, major shake‑up on the eve of an election. But after the election, is there going to come a point where a future government’s going to have to take some very, very hard decisions to get the budget out of a structural deficit?
Chalmers:
Well, first of all, we’ve taken some of those difficult decisions. We’ve made a structural improvement in the budget in areas like aged care and interest costs and the NDIS but I do acknowledge that work is ongoing.
Glenday:
But with the, sorry to jump in, I mean. Yeah, there’s deficits out for the next decade though. I mean that that is not a good long term structural problem to have.
Chalmers:
First of all, when we came to office, there were only deficits and we turned 2 of them into surpluses and this year’s deficit is much smaller than we inherited. But I take your broader point about the structural position of the budget, we know that that requires ongoing work but we shouldn’t dismiss or diminish the very substantial progress we’ve made in the budget in structural terms and in terms of getting the debt down. The debt this year is $177 billion lower than what we inherited, that’s saving the Australian people $60 billion in interest costs and that’s making a structural difference to the budget too.
Glenday:
Just finally, you want to ban non‑compete clauses for people earning less than $175,000 a year. I’m not sure how widely this is discussed in the community or indeed how widely these are used. What do you hope these changes will achieve?
Chalmers:
Well unfortunately, these non‑compete clauses apply to something like 3 million Australian workers and they make no sense because what they do is they prevent people looking for and securing higher wage opportunities, different jobs with higher wages and we want to make that easier, not harder. So, we’re abolishing these non‑compete clauses for most Australian workers. It’s good competition policy that will help grow our economy but it will also help boost wages because the more people who are free to seek those higher wage opportunities, the better.
Glenday:
All right, Jim Chalmers, thank you for your time this morning and being able to talk over those very noisy currawongs behind you.
Chalmers:
Thanks James.