Peter Fegan:
Well, there was a bit of good news yesterday and don’t we all need it? Inflation is down. In fact, some economists are declaring the worst of inflation is behind us. The figures released yesterday have Australia’s underlying inflation rate at around 3.2 per cent. That’s a three‑year low, which is fantastic. And there’s further good news because, with the inflation down, it’s now more than likely that the RBA will offer a rate cut in February. Economists are suggesting that’s what will happen. And joining me on the line now to discuss it is the federal Treasurer, Jim Chalmers. Treasurer, a very good morning to you.
Jim Chalmers:
Good morning to you, Pete. How are you doing?
Fegan:
I’m very well, my friend. Before we get into the facts and figures of inflation and the economy, can I just briefly get your comments on yet another antisemitic attack in Sydney? This is abhorrent behaviour. Look, fingers crossed and touch wood, Treasurer, we haven’t seen a lot of it here in Queensland, but it is absolutely and utterly unacceptable in our society.
Chalmers:
Completely disgraceful, despicable, unacceptable, as you say, and unfortunately not the first time that we’ve seen this. This is why we work so closely with state governments, with the police, with the authorities, because there’s no place in a country like ours for antisemitism or for violence or for these kinds of incidents which have unfortunately become more frequent.
Fegan:
The underlying inflation rate is at 3.2 per cent. It was a great result. So, are you now confident, Treasurer, that economists are saying the RBA will offer some more mortgage relief? Are you confident, as Treasurer of Australia, that we will see that relief in February?
Chalmers:
I try not to make predictions about interest rates because the Reserve Bank will come to their view independently in the middle of February and they’ll announce their decision then. What I try and do is to focus on my part of this. We’ve got the same objective as the Reserve Bank to get this inflation down. We’ve made really quite substantial progress in the fight against inflation now and those numbers showed that. And my part of the job is to get inflation down, get wages up, and keep unemployment low, and on all 3 of those fronts Australians should be really proud of what we’ve been able to achieve together in meeting those objectives.
I know that when your listeners are listening to this, that many, if not most of them are still under a lot of pressure and that’s why we don’t get carried away when we get these great numbers. We know that these cost‑of‑living pressures haven’t disappeared, but they are easing and that’s the encouraging thing about yesterday’s numbers.
Fegan:
If the RBA doesn’t, will you demand that Michele Bullock provide a ‘please explain’ to Australians? I think we all deserve it because it has been so long now since we’ve had a rate cut. And as you mentioned, the cost‑of‑living crisis is hurting all of us, and mortgage holders are really feeling the crunch.
Chalmers:
I acknowledge that one of the big pressures on household budgets has been these higher interest rates. Interest rates haven’t gone up since November of 2023, but they’re still –
Fegan:
They haven’t gone down either.
Chalmers:
– so, they’re putting pressure on people. One of the things that I’m really pleased about, Pete, is one of the changes I made to the Reserve Bank with the support of Governor Michele Bullock – she actually explains every decision. She comes out publicly and makes herself available to explain a decision whether interest rates go up or stay steady or go down. And so, people can expect whatever the decision that they take independently in February, Governor Bullock will make herself available after that to talk people through it.
Fegan:
Treasurer, we’re not far off from an election. I’ve suggested it may be mid‑April. I’m sure you have some idea, but look, everyone’s keeping their cards close to their chest. I understand that. I’ve got a fair bit of –
Chalmers:
I’m not sure if you can hear me, Pete, but I can’t hear you, my friend. My phone is playing up today.
Fegan:
Have you got me there, Treasurer? You still got me. I can hear you. Treasurer, can you hear me?
Chalmers:
I’ve got you now.
Fegan:
Sorry, Treasurer.
Chalmers:
That’s on my end, I apologise.
Fegan:
No, that’s okay. No dramas. Just talking about the election. It’s upcoming. I think we suggest it might be in April sometime. You’re keeping your cards close to your chest. We understand that as Australians. So, that’s what politics is. I’ve got a little bit of feedback here, questions from our listeners to ask you, Treasurer, but I want to ask you this, and I think this is a very, very fair question. Is Australia in a better position than we were 3 years ago under a Labor government? And just hear me out here for a moment because we’re currently experiencing a cost‑of‑living crisis. National debt is at a record high, energy prices are through the roof, as most people have mentioned on the text line this morning. Household living standards for working Australians are down by about 18 per cent. A typical mortgage holder of that $600- and $700-thousand range is paying around $50,000 more in interest. That’s just to name a few so, Treasurer, is Australia in a better position than we were 3 years ago?
Chalmers:
Well, let’s run through each of those, Pete, because I think in running through each of those, you get a good answer. Think about inflation, that when we came to office it was higher than 6 per cent and rising. Now it’s got a 2 in front of it and it’s falling. Similarly with living standards – they were falling fast when we came to office. We’re seeing a recovery in living standards, acknowledging that people have still got a lot of ground to make up in their household budgets. You mentioned energy prices numbers that we got yesterday. Energy’s gone down a little over 25 per cent in the year.
Fegan:
But have our prices gone down, though, Treasurer? I mean, we were offered, we were promised at the election, promised that our energy prices would go down. And I know there has been some relief. I know the state’s offered some relief, but federally, I have to say that you’ve let us down.
Chalmers:
No, we’re offering relief as well, Pete. I think we need to acknowledge that. There’s energy bill relief at the federal level, not just the work of the –
Fegan:
Is that the $275 that’s gone missing, though?
Chalmers:
Three hundred dollars, $300 electricity bill rebate – and because of that, but not just because of that. If you look at yesterday’s numbers, one of the most heartening things is electricity went down I think 25.1 per cent. A lot of that is the rebates that we’re providing federally, but not all of that would have gone down without it. Happy to front up to your listeners and to you this morning, Pete, and say that I know that the cost‑of‑living pressures aren’t over, but what we’ve been able to do together as Australians is get that inflation down and get wages up and keep unemployment low. And that does give me a bit of confidence about the year ahead because a lot of these indicators which you ran through and then I ran through, were much worse in May of 2022 when we came to office. We’ve worked around the clock to try and turn things around, but we know that it’s not yet mission accomplished because so many of your listeners are still under the pump.
Fegan:
Just on some of those listeners, we’ve got some – this is just a fraction of what we’ve got here this morning, Treasurer, but it’s good to have this feedback because a lot of people do want to talk to you. And this is Mark at Park Ridge. He says ‘Hi, Peter. Can you please ask the Treasurer did they lose their plan to lower our electricity bills?’ John at Thornland says, ‘Morning, Peter. A question for the Treasurer. The drop in electricity prices was one of the stated reasons for the drop in rate of inflation, as this was artificially achieved by government’. Another one from Steve. This is just another one. It says, ‘Can you ask the Treasurer and ask him to be honest, no spin. Can he look Australians in the eye and say that we are financially better off under an ALP government?’ I mean, think they’re all very fair questions, Treasurer?
Chalmers:
Yep, yep. And one of the reasons I like coming on is because I like feedback questions. It’s one of the reasons why I perch myself outside the supermarket on a Saturday in my local community so that people can give me feedback in a characteristically blunt and Aussie way. I like that. Yeah, I welcome that. Welcome those questions. And so, if you run through the ones that I can recall from your list on energy –
Fegan:
It’s energy essentially.
Fegan:
Yes, energy bills. We did provide that $300 rebate. That’s the second time we’ve done that. But that’s not the whole reason that electricity prices have come down in that year to December. They would have gone down a bit even without our efforts, but I don’t see that as artificial, Pete. I think helping people with the bills which are putting pressure on family budgets, there’s nothing artificial about that. That’s what we’re doing proudly as a Labor government – helping people take some of the edge off these cost‑of‑living pressures, doing that at the same time as we get inflation down and get the budget in better nick. And so, for all of these reasons, whether it’s the progress we’re making together on inflation or employment or wages, 2 surpluses in the budget, less Liberal debt in the budget, rolling out this cost‑of‑living relief, we found a good combination of ways to deal with these cost‑of‑living pressures.
And I think we saw yesterday the progress that we’re making together, very welcome, very encouraging, but we don’t get carried away because we know, whether it’s people calling into your show or texting into your show or right around Australia that people are still under pressure. That’s why our cost‑of‑living help is so important. And that’s why it would be, I think, important that we remind your listeners that at the election, it’s a choice, really. We have been providing people with cost‑of‑living help and we want to build the future of this country. Our opponents didn’t want to see this cost‑of‑living help. And because of that, if Peter Dutton had his way, people would be thousands of dollars worse off and they’ll be worse off still if he wins and that’s because his nuclear insanity will push electricity prices up, not down.
Fegan:
Treasurer, thank you for your time this morning, and let’s chat before the election.
Chalmers:
Really enjoyed the chat, Pete.