Raf Epstein:
Just keep in mind, interest rates went up and up and up. We expect them to come down in February, and everyone’s also expecting the Prime Minister to call an election for April. Well, not everybody, but a lot of people.
The federal Treasurer is Jim Chalmers. Treasurer, good morning.
Jim Chalmers:
Good morning, Raf, how are you?
Epstein:
I’m okay. What are you doing on April the 12th?
Chalmers:
On April the 12th? I’ll have to check the diary. But –
Epstein:
Is it clear?
Chalmers:
Usually if that’s Saturday, I’ll be perched outside a supermarket in my electorate talking to the people I represent.
Epstein:
That’s the speculated election date. Three weeks until the bank meets, the Reserve Bank. Is that the longest wait of your life?
Chalmers:
I don’t know about that, and I’m very careful not to engage in commentary or make predictions about the conversation around the board table at the Reserve Bank in the middle of February. I am focused on my part of this, my job. And I see my job as really 3 things: getting inflation down, getting wages up, keeping unemployment low. Australians collectively can be proud of the fact that we have been able to do all 3 of those things. Not every other country has been able to make the kind of progress that we’re making on inflation which we saw in yesterday’s numbers without seeing a big spike in unemployment. We’ve been able to manage that. That’s really important. We should all be proud of that. But we should also not get too carried away when we get these good inflation numbers because, as you said rightly in your introduction, people are still under pressure. The cost‑of‑living pressures haven’t disappeared but they have eased. They are easing, and we saw that in the numbers yesterday.
Epstein:
So the pressures are there. We all notice it, no matter how much – how good our income is. Twelve interest rate rises – it’s really tough. It is a very blunt instrument. Has that been worth the pain?
Chalmers:
First of all, Raf, there were 13 –
Epstein:
Oh, sorry.
Chalmers:
– and the reason I point that out to you is because the first one happened before the change of government. Our political opponents always neglect to mention the first one, which was during the Morrison government. But overall your point, I think, is broadly right, that those interest rate rises have put a lot of pressure on people and they have slowed our economy considerably, a point that I’ve made in different ways over the course of the last year or 2. I think it’s self‑evident that those rate rises the put pressure on people and slowed the economy.
It’s part of the Reserve Bank’s efforts to get on top of this inflation challenge, and we’ve got different responsibilities here, me and the Reserve Bank Governor, but we’ve got the same objective. And together we’ve got inflation from where it was at the election, which was higher than 6 per cent and rising fast; now it’s got a 2 in front of it. It’s had a 2 in front of it for a couple of consecutive quarters now –
Epstein:
So are you saying that you do think it’s worthwhile? I mean, I don’t want to ask you about the alternative ways like GST yet, but do you think – like, it’s the only instrument we’ve got. It was worth the pain? Yes or no.
Chalmers:
Well, I don’t really do those kind of yes or no questions, Raf – and the reason for that is, whether it’s after decisions taken by the bank independently or before they take decisions, I don’t see myself as a commentator on that. My job is different. My job is to be a helpful part of getting on top of inflation, and the government has been helpful – 2 surpluses, the way we’ve designed our cost‑of‑living help to be part of the solution, not part of the problem. I’m focused on getting on top of inflation without sacrificing jobs and getting wages growing again, getting the budget in better nick, rolling out the cost‑of‑living help. These are the things that I focus on because they are my job. What we saw in those inflation numbers – and all Australians should take the credit for the progress that we’ve made together – what we saw was a really quite remarkable moderation in inflation. The improvements are now quite sustained. And that is a factual point, and the Reserve Bank will weigh all of that up. They’ll come to a decision independently, and I’m not going to colour that in for them in advance.
Epstein:
Okay.
Chalmers:
And I’m not going to second guess the decisions that they’ve already taken.
Epstein:
The federal Treasurer Jim Chalmers is with you on 774. It’s 18 minutes to 9. The Treasurer is on the National Security Committee of Cabinet. I might get to those issues in Sydney in a moment. But, Treasurer, just another really important but general point: the ABS says inflation is coming down. Maybe we’ll get a rate cut. We probably will. When is it going to feel better at the supermarket?
Chalmers:
I think we’ve seen a lot of those prices, goods prices, in the inflation numbers, they’ve come off pretty substantially. One of the reasons why we’ve been so tough on the supermarkets, why we are cracking down on anything which looks like anti‑competitive behaviour, why we’ve put so much effort into the changes we’ve made to get a fair go for families and farmers is because when the prices come down, we want to see that passed on at the checkout. And in those numbers yesterday we saw that goods inflation had come down a lot.
Again, I come back to the point I made a moment ago, and that is that we recognise that even with this very substantial, very sustained progress on inflation, it doesn’t always translate immediately into how people are feeling or faring. The cost‑of‑living pressures haven’t disappeared, but they have eased considerably, and we want to see that passed on at the checkout.
Epstein:
We lost little bits of that Treasurer, but we did get the gist of the answer, so I’m going to pursue the interview with that phone line. I do want to get to a few issues in Melbourne, including the Suburban Rail Loop, and I know a lot of people texting about a fire around Bentleigh and Moorabbin. If you can see that, if you know what’s going on, we’ll come to that as well.
Treasurer, the really disturbing story, we’ve only learnt in the last few days that there was a caravan found with explosives in New South Wales. It was actually found almost 2 weeks ago. So it had explosives in it and a list of Jewish organisations. That was found on January the 19th, a Sunday. We didn’t know that. We only heard this in the last few days.
I’m just asking sort of a timing question, because the day after the caravan was found you had the opposition demanding a National Security Cabinet Meeting on antisemitism. The Prime Minister resisted that and then sort of relented a day later. Did – was the government told? Was the federal government told about the discovery of that caravan on January the 19th, the Sunday or on the Monday?
Chalmers:
A couple of things about that, Raf. First of all, these revelations and these reports are chilling. they are incredibly disturbing. We know that some of the fears that Jewish Australians have right now are not unfounded when we get these kinds of reports, and we know from the authorities that this was a potential mass casualty event. This is why it’s so important that we work so closely with the police and other authorities, the states and territories and others because obviously there is no place for violence or antisemitism in country like ours.
You asked me about the timing, and the reason I’m going to be reluctant to get into that, Raf, is because there are important operational and other reasons why we don’t speak publicly about some of these briefings that we receive from time to time. I know that people would like to know more about that. I do genuinely understand that. I don’t begrudge you asking me that, but there are very important operational reasons not to go into that, and that’s why I won’t go into it today.
Epstein:
But there’s nothing to divulge in simply – we now know the caravan was found by police. Surely it’s just a matter of transparency to ask when did the federal government get told about the discovery of the caravan. Did – I mean, I’m really asking in some ways a very political question – did you guys know about the caravan when the Opposition’s demanding a big meeting on antisemitism, a National Cabinet Meeting?
Chalmers:
I understand the question. I’m not dark at you for asking it. But the advice that we get in the briefings that we receive is that it is unhelpful to go into the nature or the timing of those briefings. I understand the answer that you’re after, but unfortunately that’s the best answer that I can give.
Epstein:
I’m sure it’s a question the Opposition will pursue. Okay, I’m grateful for your time. Something that’s really significant – and I could actually ask you – I could spend the whole interview on it – is the Suburban Rail Loop Project. The federal – the plan from the state government is that the federal government funds one‑third of that project. I realise a lot of that is in years where you may well not be Treasurer, even if Labor wins the next few elections. Do you prefer the Suburban Rail Loop over Airport Rail, or are you very keen for Airport Rail to proceed ahead of the Suburban Rail Loop?
Chalmers:
I think the best way to describe our position on that is I know in some of the commentary about those 2 projects that it is often presented as if they are very closely linked. And we haven’t really proceeded with our thinking about those projects as if they are 2 sides of the one coin. We’ve thought about them in separate and distinct ways. We’ve made commitments and provisions to both, subject to the responsible work that goes into stacking up these business cases. We’ve made a couple‑of‑billion‑dollar commitment to the Suburban Rail Loop. We’ll work closely with the Victorian government – I know my wonderful colleague, a fine Victorian, in Catherine King, speaks to her counterparts down your way frequently about these projects – to see if we can get at this time built. But we’ve made big provisions. We’re enthusiastic about building more Victorian infrastructure, and we work with the Victorian colleagues to make that a reality.
It’s not talking out of school to say that I caught up with the new Victorian Treasurer yesterday afternoon in Melbourne, had a cup of coffee and talked about some of these sorts of issues, and that’s because we work closely with the governments around the country.
Epstein:
Okay, so can I – let me ask you the blatant question, if I can. It’s very much the feeling amongst some in both your government and the state government that it’s a game of chicken – you won’t really commit to the Suburban Rail Loop until the state government tips in more on airport rail. Is that what’s going on? You’re sort of – you won’t let the dollars flow further on the SRL until the state commits further to airport rail?
Chalmers:
I can genuinely say to you, Raf, that I’ve never been in a conversation of that nature. I haven’t seen it that way. I haven’t considered it that way. Nobody’s put it to me that way. We’re big and enthusiastic investors in Victorian infrastructure. We do as much as we responsibly can to work with the states to fund these projects. We’ve made a big provision for Suburban Rail Loop subject to the usual kinds of processes and pressures. And I haven’t thought of it the way that you’ve just described it.
Epstein:
I appreciate your time this morning. Thanks for joining us.
Chalmers:
Appreciate yours, Raf. All the best.
Epstein:
Jim Chalmers, the federal Treasurer.