Peter Stefanovic:
Three of the ‘big 4’ banks now expect a rate cut next month when the Reserve Bank meets after softer than expected inflation data yesterday that continues an ongoing downward trend.
Joining us live is the Treasurer, Jim Chalmers. Treasurer, thank you for your time this morning. Is the case for a rate cut now compelling?
Jim Chalmers:
Well, Peter, you’re right to say that the numbers that we got yesterday were better than expected and better than forecast, and what they showed is that we are making really sustained, substantial progress in the fight against inflation.
I’ll leave the decisions on interest rates to the independent Reserve Bank, they can make that decision without free advice or predictions from me. My job is to focus on our 3 goals which is inflation down, wages up, unemployment low, and Australians together have made very encouraging progress on all 3 fronts, especially in that inflation data that we got yesterday.
Stefanovic:
All of those 3 points are correct, and rate relief is no doubt good news, but how do you tell that to the thousands of businesses that have already folded this year?
Chalmers:
First of all, we understand – whether it’s small businesses or Australians more broadly – that there is still a lot of pressure. The cost‑of‑living pressures haven’t disappeared but they are easing. We’re not getting carried away by this progress because we know that a lot of people and a lot of small businesses are still under the pump.
One of the reasons why those numbers are a bit higher is because we’ve got more businesses in our economy. If you compare the number of businesses to the total business base in this country, the rate of insolvencies is actually lower than it was under John Howard and lower than the average. But we do acknowledge people are under pressure, that’s why we’re not getting carried away by yesterday’s inflation numbers even though they were very, very encouraging when it comes to getting inflation well into the Reserve Bank’s target band.
Stefanovic:
Sure. And despite possible relief, do you concede that people are still poorer now than when they were at the last election?
Chalmers:
Well, you asked me about how people were faring at the last election, remember inflation was higher than 6 per cent and rising then, real wages were falling, real incomes and living standards were falling then and we’ve turned around the inflation story in our economy, we’ve got real wages growing again, we’ve kept unemployment at the lowest average rate of any government in the last 50 years.
We know and we acknowledge and we’re upfront in saying that people have still got a lot of ground to make up in their household budgets – that’s why our cost‑of‑living relief is so important, that’s why it beggars belief that when it came to helping people with these cost‑of‑living pressures that Peter Dutton opposed them rather than supported them and that means people would have been thousands of dollars worse off if Peter Dutton had his way and they’ll be worse off still if he wins the election.
Stefanovic:
Signs are now pointing to an April election, Treasurer. Can you confirm?
Chalmers:
I can’t, Pete, that’s a decision for the Prime Minister. No doubt he’ll have a discussion with the colleagues about that. The election’s due by May. My job is to continue focusing on my job, those things that I keep coming back to, the lower inflation and higher wages and low unemployment. That’s my focus. I’ll keep doing my job until the Prime Minister calls the election and it’s a matter for him when he does that.
Stefanovic:
Okay. Elsewhere today, Treasurer, this potential mass casualty event in Sydney after that caravan filled with explosives was found bound for Jewish targets, can I just get your thoughts on that this morning?
Chalmers:
Incredibly disturbing and what it shows is that the fears that many have in the Jewish community in Australia are not unfounded when we hear these kinds of reports. Now I know that the joint counter terrorism teams have described this as a potential mass casualty event which is chilling, which is disturbing. We know that the threat is now being contained, we know that arrests have already been made and I thank the police and the authorities for what they’ve been able to do here. This is the whole reason why we’re working closer than ever with the police and other authorities because there is absolutely no place for violence or antisemitism in a country like ours.
Stefanovic:
Right. So what does the federal government do about that now? Are there security meetings that will be taking place?
Chalmers:
We’ll have an opportunity to be briefed this morning about what has happened here. We have shown a willingness as a government to work incredibly closely with the police and other authorities, with the states and territories, it’s why we’ve got these special operations, it’s why we are so grateful to the police and other authorities for containing this threat, for making these arrests.
We need to be vigilant and we will be because as I said earlier, there is genuine fear in the Jewish community that’s not always unfounded, and that’s because we get these sorts of reports and we will continue to work closely with everyone who has a role here in containing these threats.
Stefanovic:
So, when you say you’ll be briefed, is that a national security or Cabinet meeting?
Chalmers:
Well, I’m reluctant to go into the details, Pete. I think as your viewers would expect, we get the opportunity to be briefed on these sorts of major events and that will be the case this morning.
Stefanovic:
We’ll have to leave it there. Treasurer Jim Chalmers, thanks for your time.