Kieran Gilbert:
Let’s go live to the Treasurer, Jim Chalmers, who joins us on Newsday. Treasurer, thanks for your time. Nice to chat to a young bloke like Jack. He’s from Melbourne and won this huge competition and appearing at Carnegie Hall this Sunday.
Jim Chalmers:
What a seriously talented fella. My goodness.
Gilbert:
Yeah, it is. It’s a tough act to follow.
Chalmers:
Unbelievable. I wish him all the best. Wonderful to be with you, Kieran.
Gilbert:
Absolutely. Thanks, mate. Well, when I was 15 I certainly wasn’t doing that. But let’s turn our attention to the news of the day and the COP talks. Is this a sense of relief for you that you don’t have to fork out what would have been a couple of billion dollars to host the thing?
Chalmers:
There were good reasons to support the bid for Australia and there were good reasons why the world overwhelmingly supported us, but I think this is a very welcome outcome in the circumstances. And that’s because for all of us who want to maintain momentum and progress in the world towards net zero, we couldn’t afford to see this drag out and drag on for another 12 months or so. And so I think a very good outcome in the circumstances, because it ticks 3 boxes which are really important to us.
First of all, we maintain an influential voice in all of this because Chris Bowen will be the President of Negotiations. That’s important to us. Secondly, we’ve made sure that the Pacific is front and centre, which is really one of our most important objectives in all of this. And thirdly, it means that we can do what we can to maintain and build progress towards net zero in this really important multilateral forum. So, a good outcome in the circumstances for those 3 reasons.
Gilbert:
At the same time though, the politics of it as we look to the year ahead, the Liberals really drawing a line in the sand. They say it’s all about affordability. Sussan Ley was out there again saying, ‘When are you going to bring down power prices?’ Week in week out, you can expect them to be making that case. Is it – you know, politically, is it a welcome result given you would have had tens of thousands of officials in Adelaide, questions over the taxpayer dollars involved at the same time? The contrast would have been difficult politically.
Chalmers:
We don’t view these developments through a political prism. Our opponents do that. Their decision‑making is guided by the very messy internal politics of the Coalition. We’re focused on the economic opportunity here and the world’s progress towards net zero. Certainly Australia’s part in the economic transformation that net zero represents, is a golden opportunity for our country. That’s how we see it and that’s how we approached this bid as well.
But when it comes to some of the things that Sussan Ley and others have been saying about net zero, let’s be really clear about this, Kieran. Abandoning net zero would push power prices up, not down. It would decimate investor confidence. And that means it would weaken our economy. The proposal that the Coalition’s put forward would be a disaster for our economy. The Treasury modelling document makes that clear. Even the IMF report today, which strongly supports the government’s approach to grabbing the economic opportunities given to us by net zero. All of the serious mainstream players here know that we’ve got to replace this electricity generation as the ageing coal‑fired power stations become less reliable and then come out of circulation.
The cheapest way to do that is with cleaner, cheaper, renewable, reliable energy. That’s what every serious economic analyst has concluded as well and that’s the government’s approach. So the other guys can be motivated by their internal politics. We’re motivated by the national economic interest and that means an orderly transition to net zero and it means making progress in the world, which is what COP’s all about.
Gilbert:
Yes, indeed. I understand you saying you’ve got the policy right, you believe that, but you’ve got to explain to people as well, convince them that their power prices will come down, don’t you? Because that question Sussan Ley keeps coming – when will the prices come down? When will they come down? That will resonate with many people as they struggle around the kitchen table.
Chalmers:
I think Australians understand that when we need to replace these aging assets which are becoming less reliable and, in fact, it’s the old assets which are pushing power prices up, not the new renewable assets which are being introduced into the grid. I think people understand that what matters is the type of electricity that we add to the grid, and the cheapest way to do that is with renewable, reliable energy and that’s what we are proposing to do.
Now, we understand that people are under pressure. It’s why we’re rolling out the cost‑of‑living help that our opponents opposed, it’s why we’re providing the electricity rebates, it’s why we’ve got these rebates for batteries which people are taking up with gusto. It’s why we’re doing all of this work to strengthen our electricity system in the most reasonable, responsible and rational way.
And so the point that Sussan Ley keeps making is motivated by internal politics. I think any serious objective observer of our energy grid understands that the best way to get power prices down over time is to introduce more cleaner and cheaper renewable, reliable energy and that’s what we’re doing.
Gilbert:
You urged the business community to pressure the Coalition to back the environmental law reform changes. Looks like it’s back‑fired, with the Nationals urging the Coalition not to do a deal, saying they shouldn’t do a deal if you’ve got the, you know, the proverbial gun to their head.
Chalmers:
Obviously, I don’t agree with the way that you’ve put that to me, Kieran. That wouldn’t surprise you. Look, I respectfully encouraged the business community in Western Australia, indeed the business community around Australia, to help land a responsible outcome when it comes to these important reforms to our environmental laws. These are all about better outcomes for our environment and for our economy by making the system faster, more efficient, more robust, more transparent. And next week is going to be a really important week in the Senate because it will determine whether we bed down these important changes or not.
So, I don’t think it would surprise your viewers to learn that I have been encouraging people to make the case. Out of the Economic Reform Roundtable, one of the key conclusions was that we needed to try and legislate this this year, rather than next year if we could. That’s in the hands of the Senate and I think anyone who wants to see this bedded down has an opportunity to lobby for that outcome.
Now, when it comes to the National Party, I mean, the National Party’s run by extremists and it’s no surprise to learn that the figures that you’ve quoted would like to say no to everything that the government puts forward in the Senate. That’s again not especially surprising. The Senate’s got a good opportunity next week to do the right thing by our economy and by our environment simultaneously, and I think the onus is on all of us who want to see that outcome to work towards it.
Gilbert:
The IMF report out today, it endorses the energy transition – the government’s targets for 2035 quite clearly, raises ideas like lifting the GST, like re‑establishing a mining tax. Those of us old enough – you know, too old like me – remember some of the history around that. But many of the new generation probably would like income tax cuts. If you can say, we’ll do this, lift the GST or broaden it and you get tax cuts. Is this something that the IMF raises where it’s appealing to you in any way?
Chalmers:
It’s not unusual for the IMF to put forward different ideas and it’s not unusual for the government to say we don’t agree with all of them. We don’t agree with all of the proposals put forward in the IMF report around the GST or some of these other tax matters. But we are cutting income taxes 3 times. We are introducing a standard deduction to provide a little bit more relief but also to simplify the system. We are reforming the tax system when it comes to incentivising more rental properties. We’re reforming the tax system when it comes to critical minerals and hydrogen.
So we are engaged in a lot of tax reform already, the primary purpose of that is to cut income taxes 3 times. Our opponents wanted to repeal those tax cuts so that people would be paying more tax. But under this government, whether it’s the wages figures yesterday, the employment figures last week or what we’re doing with these 3 tax cuts, this government is all about making sure that more Australians are working, earning more and keeping more of what they earn. That’s our objective, and that means we don’t have to pick up every suggestion put to us by the IMF.
But overwhelmingly, that IMF report today is a very powerful endorsement of Australia’s economic fundamentals and the government’s reform agenda, coming out of the Roundtable but also when it comes to net zero.
Gilbert:
Treasurer, thanks for your time.