NATALIE BARR:
The federal government is set to deliver more cost‑of‑living relief in the May Budget. It comes after Labor suffered a significant swing against them in Saturday’s by‑election. Dunkley is a mortgage belt seat with voters making their hip pocket pain loud and clear.
Joining me now is Treasurer Jim Chalmers. Morning to you. We know we’re getting the stage three tax cuts in the budget. What else are you going to do for families?
JIM CHALMERS:
Good morning, Nat, and you’re right – every Australian taxpayer will get a tax cut from the 1st of July, and most people will get a bigger tax cut to help with these cost‑of‑living pressures. We’re also rolling out cheaper medicines, we’ve had the electricity bill rebates, we’ve got rent assistance rolling out right now, but if we can afford to do more in the May Budget, obviously we will consider that – we’ve made that clear for some time.
We know that people are under pressure. Even though inflation is coming off in welcome and encouraging ways, even though we’ve got this wages growth which is a good thing as well, we know that people are still under the pump – that’s why the tax cuts are so important and it’s why if we can do more in the May Budget, we will.
BARR:
Can you guarantee that the tax cuts won’t fuel inflation?
CHALMERS:
We made that very clear when we announced it. We consulted obviously the Treasury but also the Reserve Bank. There’s no change to the inflation forecasts as a consequence of these tax cuts and that’s because we’ve taken the same amount broadly – $107 billion of tax cuts and we’ve rejigged them so that everyone still gets a tax cut but there’s a bigger tax cut for people who need it most. And because it’s roughly the same cost as it was going to be before, we don’t expect it to add to inflation. We also think it will encourage more people into work, which is good for inflation too.
BARR:
We’ve just had these figures out – businesses are reporting a sharper fall in their inventories. They’ve got less stock. How worried are you that our economy is now really slowing?
CHALMERS:
Well, those inventories numbers certainly are a warning sign in our economy. We know when the economy is especially weak, businesses are more likely to run down their inventories rather than stock up and that's one of the ways that we know that the economy towards the end of last year when those numbers are from was quite weak. Remember, that was the quarter where Japan and the UK both went into recession, we had the interest rate hike in November, we had these persistent cost‑of‑living pressures that you asked me about a moment ago, and for all of those reasons, we think all of those things will weigh on growth in that December quarter of last year. We don’t yet know exactly how much – we’ll know that tomorrow when the National Accounts are released. But I’ve been pretty upfront with people and said that they should be ready for what was, we think, most likely, a pretty weak quarter of economic growth in our economy. And that’s why the investments that we’re making and the engagement that we’re doing here at ASEAN is so important.
BARR:
Okay, Peter Dutton is going nuclear, literally. What do you think of his plan? Can you guys guarantee that renewables will be able to supply 24/7 power?
CHALMERS:
Of course renewables are the most important way, but also the cheapest way and the cleanest way to satisfy our energy needs into the future. Increasingly over time our economy will be fuelled by cleaner and cheaper and more likely renewable and more reliable energy. And it’s no surprise –
BARR:
What about the nukes?
CHALMERS:
Well, it’s no surprise to anyone I think that Peter Dutton has gone for the most expensive option, the most divisive option and the one that will take the longest to build and that’s because he’s more interested in cheap and divisive politics than cheap and reliable power. We see that in this more or less culture war over nuclear energy.
This is a nuclear fantasy – it’s more expensive, it takes longer and we know here in Australia our advantages and our future lies in renewable energy. And that’s the difference between the two parties. If he was genuine about wanting cheaper electricity for Australians, he would have voted for our electricity bill rebates and he wouldn’t be going down this path, which will cost hundreds of billions of dollars, take decades to build and will turn our back as a country on the big renewable energy opportunity before us.
BARR:
Okay. Just finally Treasurer, we’ve been told by our mail room downstairs that we’ve got a delivery from the Prime Minister. Do you have any idea what that could be? It’s addressed to Shirvo.
CHALMERS:
I don’t know. Is it Shirvo’s birthday? I’m not sure.
BARR:
No, it’s not.
MATT SHIRVINGTON:
Should I be worried?
BARR:
Does he send – is it a – what about the buck’s party? Have the invites gone out for the bucks party?
SHIRVINGTON:
Can you ask the Treasurer if he’s been invited to the bucks party?
BARR:
Yeah.
CHALMERS:
I haven’t. I haven’t. Shirvo might have been, I haven’t. I’m not sure what the arrangements are on that front. But Shirvo, if you’re invited, my advice to you is to turn up.
BARR:
Interesting. Because there are headlines that you and Albo have fallen out –
SHIRVINGTON:
It’s going to be that good, is it?
BARR:
So maybe Shirvo’s got the invite and you haven’t, Jim Chalmers.
CHALMERS:
Maybe I could be Shirvo’s plus one.
SHIRVINGTON:
Absolutely. Who doesn’t need a plus one?.
BARR:
We’ll let you know what it is. Thank you very much, Treasurer.
CHALMERS:
Thanks.