JOHN STANLEY:
My name's John Stanley. You're listening to 3AW, 2GB, 4BC and stations up and down the east coast of Australia. We're joined now by the Treasurer, Jim Chalmers. Good evening to you, sir.
JIM CHALMERS:
Good evening to you, sir. How are you, John?
STANLEY:
I'm not bad. We're here with Joe Hildebrand, Scott Haywood and Tom Elliott of 3AW.
CHALMERS:
I didn’t know Hildebrand was going to be there, I wouldn't have come on.
JOE HILDEBRAND:
G’day, Treasurer. How are you?
STANLEY:
And Scott Haywood and Tom Elliott from 3AW as well.
TOM ELLIOTT:
Hi Mr Chalmers, Tom Elliott here. So, there was no message tonight of the stage three tax cuts. Does that mean they are locked in? That they cannot be taken away in this or any future Budget?
CHALMERS:
The reason they weren't mentioned in the Budget today is because they were legislated some time ago. They don't come in for another year and a bit, and the Budget just lists the new decisions. And so, because there hasn't been a change in position, it doesn't get a specific mention in every Budget after they've been legislated.
ELLIOTT:
And there won't be a change in position regarding them?
CHALMERS:
We haven't changed our position, we haven't contemplated it in the course of this Budget, we’ve got other priorities.
SCOTT HAYWOOD:
Treasurer Jim Chalmers, Scott Haywood from 3AW Money News. Small business in Australia employs around about 4.7 million people. That's about 40 per cent of the business workforce. Yet all you did tonight was give a 20,000 instant asset write off, maybe an energy incentive and maybe some grants for digital technology. That's not enough when you also said tonight that wages growth is going to go up by four per cent and small businesses have not recovered from the pandemic. What do you say to those owners tonight?
CHALMERS:
Well, we've tried to do what we could to support small businesses in this Budget. Hundreds of millions of dollars in new tax breaks that you just ran through I don't think are minor benefits. We're hoping that we can help small businesses invest and grow and innovate, and that's what's behind those new tax breaks that I announced tonight.
HILDEBRAND:
And, Treasurer, the other big centrepiece of the Budget was this $2 billion hydrogen fund, this hydrogen development fund. A lot of people consider this to be a little bit pie in the sky. I know Twiggy Forrest is all in on it. I know there are huge potential benefits, but this hasn't really been road tested yet. How confident are you that hydrogen is going to be a serious part of Australia's future fuel mix?
CHALMERS:
I'm supremely confident and if you asked me that question 10 or 15 years ago, I would have probably said that there's an element of uncertainty about it. But you look at how the world's moving, you look at what the Americans are doing in particular. And our job here is to try and work out how do we become beneficiaries rather than victims of all this investment that's going into cleaner and cheaper energy and where do we get our slice of the action. And I think increasingly, the business community, certainly in the investor community I knock around with, they see hydrogen as a really important part of our future and we want to back it.
HILDEBRAND:
And I imagine you're envisaging it for heavy industry. I mean, I know there's a bit of money there for sort of hydrogen transport and that infrastructure isn't even literally on the map yet, but I imagine you're thinking of it for using things like really high energy stuff, like steel and aluminium smelters. And again, of course, for big machines on mines or transporting stuff. Is that what you're imagining, or are we all going to be driving hydrogen‑powered cars one day?
CHALMERS:
No, I think two things primarily, it'll be heavy industry, as you rightly identify, but also, it's a big export opportunity for us. Japanese love it, and others, the Koreans. And so what we really want to do is we want to back production, and that's what this production credit is all about.
ELLIOTT:
Treasurer, the $10 billion Housing Fund which the Greens oppose, I actually think it's a good idea, but would you be able to get them on side? Because they want to freeze rents for, like, two years until they agree to it. Have you done any sort of deal with them to get their vote in the Upper House, to get this through the Parliament?
CHALMERS:
Well, we haven't done a final deal, but we've been trying to get the support of the Parliament and we've made a number of changes to the policy to try and get people to vote for it, because there's two things going on here, and a lot of your listeners would understand this from their own lives, which is that we've got really low vacancy rates in the rental market. We’ve got really high rents and so the job of Government ‑ I think there's two of them. One is to try and encourage the building of more properties. So, there's the Housing Australia Future Fund, but also I announced some new tax breaks tonight for build‑to‑rent properties, to build more rental properties near where the jobs are being created. And also we're going to take some of the edge off these higher rents, and the best way to do that is to increase the Commonwealth Rental Assistance as well by 15 per cent, which was another big announcement in the Budget tonight.
HILDEBRAND:
And, Treasurer, another thing that will piss off the Greens, and I just so much enjoy it when your Government does this, you've got an impeccable track record. And can I just say from the bleachers, we're all cheering for you. But was the announcement of and in dollar terms, it's not that much, but I think it's far more significant in terms of what it signals to Australians and to the industry. But this future gas strategy, this is in line with the thinking of former Chief Scientist Alan Finkel, for example, who says that gas is a really important transitional fuel that we shouldn't be throwing it in the same handbasket as coal and just getting rid of the whole thing. We need to keep it online until we've got enough energy security and enough affordable energy. How committed is the Government to making sure we do have a gas industry in Australia for as long as we need it? It seems to me a pretty clear signal that if you've got a future gas strategy that you're paying $6 million to develop, then you're pretty big on future gas.
CHALMERS:
Yeah, I think it's got an important role to play and the Prime Minister does as well. Really the Cabinet does. Even the Climate Change Minister believes, rightly, that gas has got a role to play in firming and in the transition to net zero. I knock around with the gas companies a bit because we've just announced a $2.4 billion increase to the PRRT and that's meant a lot of consultation with the industry. And in every stage of that consultation, I've made it really clear that I think they've got an important role to play in our economy and in the transformation to net zero over time and the Budget and that strategy that you are kind enough to mention backs that in.
STANLEY:
Treasurer most of the measures, the cost‑of‑living measures are targeted toward low income earners, people on fixed incomes, concession card holders, people on JobSeeker and other payments. People in the middle listening to us tonight who are doing it really tough with the cost‑of‑living, but they're in that middle income bracket, what have you got in there for them? Because the Opposition is saying that they're probably about 25,000 a year worse off than they were a year ago and there's not much in this Budget for them.
CHALMERS:
Well, first of all, you can't believe a word that those characters say. But I won't spend a lot of time on ‑
STANLEY:
What is there for them right now, those people?
CHALMERS:
That's what I want to get to. So, obviously some of the measures around JobSeeker and rent assistance and energy relief are about people on the lowest payments. But there is a heap of stuff in this Budget for middle Australia and they have been a big focus. For example, tripling the bulk billing incentive for families with kids under 16 is a big thing for middle Australia. Cheaper medicines for millions of people, big thing in middle Australia. The broader investments in Medicare, the Household Energy Upgrades Fund, big thing for middle Australia. There's a whole bunch of stuff in there. And because we've said that when you've got a tight Budget, you've got to prioritise the most vulnerable. That's true. They are the priority in the Budget, but that doesn't mean we haven't picked up on, I think, the reasonable point that you're making, that people are doing it tough even in middle Australia, and the Budget supports them too.
HAYWOOD:
Treasurer, I want to harness that word you said being vulnerable, because you said tonight that we're approaching some of the toughest economic environments in the next few years. And right across the Nine Radio Network, we speak to vulnerable scammers sorry, vulnerable retirees who are subject to scammers. Now they get spoof text messages who impersonate official organisations such as banks and MyGov. Now, tonight you announced 10.5 million is going to be spent to establish an SMS Sender ID Registry. Is that really enough for vulnerable retirees and those who don't understand what messages they are or aren't getting?
CHALMERS:
It's really important, but it's not [inaudible] we're doing. And tip my lid to Stephen Jones, my colleague, the Assistant Treasurer, who's been doing a heap of work on scams, working with Michelle Rowland in Communications and with other colleagues working with the banks, and the private sector. I think this is a huge, huge problem. I see it in my own community, people getting ripped off by these absolute grubs from around the world and sometimes closer to home. And we want to stamp it out. It's getting more sophisticated and so the Government response needs to be more sophisticated as well. The text part of it that you just mentioned is part of it, but it's not all of it. There's a lot of work going on.
ELLIOTT:
Well Treasurer, you've got the first surplus in I think it's 15 or 16 years, $4 billion this year. You're then going back into deficit. Do you reckon you'll see another surplus down the track which will actually help start repaying all the debt that we're accumulating?
CHALMERS:
Well, I just announced this one and it's a forecast surplus for this year, but you're right that subsequently the deficits are smaller than what they were before. And obviously we got more work to do. We don't ever see it as mission accomplished when it comes to making the Budget stronger, more sustainable, more responsible. But we made so much progress over the first two budgets, the biggest turnaround in history in the Budget, and that's because we're taking a responsible approach to these upward revisions to revenue. We're doing it in the most responsible way at the same time as we provide a bit of money to help people through hard times and invest in the future at the same time. So, we made a heap of progress in the near term and in the structural position of the Budget. But if your question is, is there more work to be done, then obviously in every single Budget we try and get maximum value for money. We try and clean up the mess as much as we can so that we can do the things that we want to do for people.
ELLIOTT:
And finally, you made a point during your speech about how one of the biggest economic challenges of our time is inflation, and obviously it is, because the Reserve Bank keeps putting up interest rates. The way you've structured the $500 I'm not sure if it's a rebate on power bills. Is that going to be done in a way which will reduce the headline rate of inflation?
CHALMERS:
Yeah, so what the Budget papers say from the Treasury is that a combination of the caps that we put on the price of gas and coal, combined with this energy bill relief will take about three quarters of a per centage point off the inflation forecast next year, which is a decent improvement. One of the reasons why inflation is moderating next year is because of those policies and the way that we're doing it in most instances ‑ it's a different deal for every state and territory ‑ but the way we're doing it in most instances is we get that amount subtracted from the bill that people get. And so that means the bill they get in the mail would be lower than it would otherwise be.
HILDEBRAND:
And just briefly, before we let you go, Treasurer, we mentioned that last surplus in 2008. If memory serves, you were Wayne Swan's Chief of Staff at that time, or Senior Advisor. How much did the memory of that surplus and then, of course, all the promise that the GFC and then the promise surpluses that never arrived, how much did that fuel your decision making in this Budget? And perhaps even, how much did memories of that time haunt you?
CHALMERS:
Obviously we're all aware of the history. I think the much more important history is when my predecessor was wandering around this building with Back in Black mugs and giving himself a big pat on the back, that was a bit humiliating. I've tried to be more cautious about it. Joe knows me a bit and he knows I'm a pretty cautious, pretty careful character when it comes to these sorts of things. We're forecasting a surplus for this year.
STANLEY:
You got to deliver it though, don't you?
CHALMERS:
That's a good outcome. We'll know in a couple of months if we got there. But what we already know is we wouldn't be within cooee of a surplus this year were it not for the responsible approach that we've taken over two budgets.
STANLEY:
All right, Treasurer, we'll let you go. And I'm sure there's going to be more analysis. And as usual, you'll probably want to see what those front pages are tonight to see how your Budget's been overwhelmingly positive. Thank you. Treasurer Jim Chalmers.
CHALMERS:
Appreciate it fellas, thank you very much.