LEIGH SALES, HOST:
Jim Chalmers is the newly appointed Treasurer. Congratulations, Treasurer.
JIM CHALMERS, TREASURER:
Thanks very much, Leigh. Thanks for having me back on the show.
SALES:
You've met with the Treasury Secretary and been given the so‑called red book, the briefing for the incoming Government. What is the lay of the land?
CHALMERS:
I've had three days of briefings now. The Treasury Secretary came to my place in Logan on Sunday, and now we've had basically two days of rolling briefings. The challenges in the economy are pretty clear. We've got high and rising inflation and therefore rising interest rates. We've got real wages falling backwards quite substantially, and we've got a trillion dollars of debt in the Budget, which will take generations to pay off, but it's not currently going to deliver a generational dividend. So the challenges that I'm inheriting from my predecessor are pretty serious challenges. We want to be upfront about that. We've already begun the work of trying to address particularly, those three challenges that I mentioned.
SALES:
How are you going to deal with the issue of not contributing to inflation while implementing some of the spending promises you've made during the election?
CHALMERS:
Well, the promises that we made during the election, the commitments that we will budget for in the October Budget, are all about trying to increase the speed limit on the economy without adding to those inflationary pressures. It's economic orthodoxy to say if you've got inflationary pressures, then you need to increase the size of the economy, you need to expand its capacity. And you do that with cleaner and cheaper energy. You do it by making the workforce bigger through childcare reform. You train people so that they can work more and earn more in those higher wage, higher skill opportunities that emerge in an economy like ours. Our economic plan, our economic agenda, is geared towards those inflationary pressures, and also getting real wages moving again in a way that doesn't add substantially to the Budget bottom line, but improves the quality of the spending in the Budget.
SALES:
Have you met yet with the Governor of the Reserve Bank, Philip Lowe?
CHALMERS:
I'll be meeting with Governor Lowe tomorrow. I'll be meeting with him and with all of the major regulators in our economic architecture, and I'm looking forward to that discussion. Phil Lowe is someone for whom I have a lot of respect and regard, I've known him for a long time now. I've worked closely with him in the past, and the same goes for the Treasury Secretary and a number of the other regulators as well. So I'm looking forward to that discussion.
SALES:
Have you sought any advice from one of the predecessors in your job, Paul Keating?
CHALMERS:
I have. Paul is someone that I've become pretty close to over the last decade or decade and a half, and I really appreciate his friendship and his advice. He's one of the reasons I got involved in politics in the first place, and so I speak to him regularly. I speak to Wayne Swan regularly, as you'd expect, as well. One of my favourite congratulatory calls was when Paul Keating rang the other day and he said "Treasurer!". He said: “Am I the first person to call you that?" And I said, not the first, but the one that I appreciate the most. I've always enjoyed his company and his advice and his encouragement, and that will be especially the case as I take up the role that he made his own for such a long time.
SALES:
Do you think that in your first Budget you will be presenting a plan to begin paying down debt?
CHALMERS:
Well, it will take generations to pay down the debt that we've inherited. The Budget is heaving with a trillion dollars in debt and not enough to show for it, because there's all of these rorts and all of this waste that you and I have talked about before. The first step Katy Gallagher and I will begin as soon as possible, is an audit of those rorts and that waste in the Budget. That will be an important way to try and go through the Budget line by line to make sure that we can either improve the Budget position or invest the taxpayers money more wisely to get a proper economic dividend for the country. We've already highlighted eleven and a half billion dollars worth of Budget improvements. We did that when we released our costings during the campaign. We hope to find more Budget improvements so that we can improve the Budget over time. But I've got to be upfront with you and with all of your viewers Leigh, and say this is a big, substantial problem. You can't just flick a switch and make a trillion dollars of debt disappear. It's going to be a lot of hard work over a long period of time, but that hard work has already begun.
SALES:
For years, experts have been saying that we have to embrace tax reform. And in fact, when you get into your new office in Parliament House, if you probably open the bottom desk, draw, pull out a big fat time and blow a thick layer of dust off it, you'll find the Henry Tax Review that was done when you were last in government. Is there any chance that you would take a look at shifting Australia's tax system away from income tax to consumption tax?
CHALMERS:
No, that's not our priority, Leigh. We made that clear on both sides of the election. We think that the best place to start when it comes to tax reform is multinational tax reform. There are global developments that we want to be part of to make sure that multinational corporations pay their fair share of tax in Australia. We think that's an important step.
SALES:
The Albanese Government has turned back its first asylum seeker boat. Can you give us some details of that, please?
CHALMERS:
We were really disappointed, frankly, Leigh, when the former Government publicised ‑ for political reasons on election day ‑ that this boat was headed towards Australian waters. What we did, the acting Prime Minister Richard Marles and myself as the acting Home Affairs Minister, is that we applied the exact same policy that the former Government would have, to make sure that those twelve passengers were returned to Sri Lanka. We did that under Operation Sovereign Borders and our message to the people smugglers throughout the region is that the policy of the new Government is no different to the policy of the old Government when it comes to enforcing Operation Sovereign Borders. If people try and take that dangerous trip, they won't make it here. They will be subject to the same arrangements that existed before Saturday.
SALES:
Treasurer, thank you.
CHALMERS:
Thanks very much Leigh.