Sally Sara:
The federal government in Australia will provide an additional $95 million in military assistance to Ukraine. It’s Australia’s first significant increase in military help to Ukraine in more than a year, bringing the total in defence support to $1.7 billion since Moscow’s full‑scale invasion began in 2022.
Jim Chalmers is the federal Treasurer and joins me now. Treasurer, welcome back to Radio National Breakfast.
Jim Chalmers:
Thanks for having me back, Sally.
Sara:
What can you tell us about this multi‑million‑dollar funding package for Ukraine. What will this money achieve?
Chalmers:
Well, we’re steadfast supporters of the brave Ukrainian people who are standing up to this Russian brutality. And the end of this war can’t come soon enough, but it needs to be a lasting peace that does justice to the courage that the Ukrainians have shown.
And so for as long as this war continues, we will continue to support Ukraine in any way that we responsibly can. Today’s announcement is all about that.
This is about contributing to a fund for material and equipment to help support the Ukrainian war effort. It does come as part, as you rightly identified, of a $1.7 billion package over recent years, which makes us a big contributor in non‑European terms, and it also comes hand‑in‑hand with some targeted sanctions. We’re going to sanction an additional 45 ships in Russia’s shadow fleet.
So all of these things are about supporting the bravery, the courage of the Ukrainian people in the face of these years now of completely unacceptable Russian brutality and aggression.
Sara:
You’ve mentioned briefly these new sanctions. So this will apply to around 45 Russian ships. How did the government arrive at this decision?
Chalmers:
Well, we take advice on this. There’s now about 200 sanctioned Russian vessels in their shadow fleet. As your listeners would appreciate, that sanctions need to evolve because the Russian strategy to avoid these sanctions evolves as well. We engage with our partners around the world and we take these decisions when it’s appropriate to do so. Really across a range of fronts, we’re doing what we can to try and strangle Russian oil revenue. That challenge evolves, and so our sanctions evolve as well.
Sara:
So how will the sanctions work on these 45 ships?
Chalmers:
Well, there’s a whole range of international legal arrangements, that’s why we work with our partners, nobody really imposes these sanctions completely alone, but we’ve seen, for example, in recent weeks stories about some of these ships accessing ports inappropriately. So there’s about 200 ships on the list now, they’re sanctioned as part of the shadow fleet, that gives them a different status as they try and access the ports of the world.
We don’t pretend that with every announcement that we completely strangle this trade in Russian oil, they’re doing a lot of work to get around it, but our sanctions evolve because their strategies evolve, and that’s part of it.
But the main thing today is this extra $95 million as part of our efforts to support the Russian military to try and achieve peace in that part of the world which does justice to the sacrifices that Ukrainians have made.
Sara:
Let’s take a look at the economy. The Australian economy grew by 0.4 per cent in the September quarter, a softer than expected figure, were you disappointed by that?
Chalmers:
No, not for one second. In fact, the number came in a bit lower because the quarter before was revised up and there was some unusual activity when it comes to inventories.
This was a very positive and very promising set of numbers and the reason for that is because the overwhelming story of these National Accounts was a very substantial recovery in the private sector.
We saw business investment absolutely galloping, we saw investment in the building of new homes growing strongly as well. We saw the fourth consecutive quarter of productivity growth. And so overwhelmingly this is a very positive and a very promising story emerging out of these National Accounts. It also means the strongest annual growth in the last couple of years. And so for all of those reasons, these numbers were very welcome.
Sara:
A lot of the growth for this quarter is driven by investment in data centres. You can’t count on that every quarter, can you?
Chalmers:
Well, the investment mix changes from quarter to quarter, but this is a trend now, and frankly, one of the most encouraging elements of this data was the way that this business investment grew very substantially, and technology and data infrastructure was a big part of the story. And that’s a good thing, because data and digital and artificial intelligence is a game changer for our economy, it will be a huge part of the more productive economy that we’re building into the future. And so we welcome this investment.
Investment came into other areas as well. Really, the new business investment number in the National Accounts was extremely positive as were the numbers around investment in building more homes. The productivity numbers were encouraging too. So really right across the board there was a lot to be pleased about in these National Accounts.
Sara:
You’ve attracted criticism from the Opposition about government spending keeping interest rates high. What do you say to those concerns?
Chalmers:
Well, it’s rubbish, and the reason it’s rubbish is, if you look at the National Accounts yesterday, it’s the private demand which is doing all the heavy lifting in our economy. Private demand has now contributed more to growth in our economy than public demand for 4 quarters in a row. In fact, in the quarter just gone the private economy made a 3 times bigger contribution than public spending. And if you think about the last year, annual private demand growth in the last year has increased more than 5 times and annual public demand growth is less than a third of what it was a year ago.
So they don’t know what they’re talking about. They’ll go to great lengths, even dishonest lengths to talk down our economy and diminish the progress that Australians have made together. Any objective observer of yesterday’s National Accounts would conclude that the private sector recovery is the stand out story of those National Accounts, and that’s a good thing.
Sara:
You’re getting ready to deliver the mid‑year budget update. What’s going to happen with energy rebates? Is there a case for those being extended?
Chalmers:
I will make those decisions in the final few days before we lock down the mid‑year budget update. I’ve made it very clear, I think, on your show before, Sally, and certainly on other occasions when I’ve been asked, that people shouldn’t expect that those energy rebates will be a permanent feature of the budget.
They are an important way that we’re helping people with the cost of living, but not the only way that we’re doing that – we’ve got tax cuts, cheaper medicines, student debt relief, more bulk billing, Fee‑Free TAFE, rent assistance, there are a whole range of ways that we’re helping people with the cost of living. We haven’t finalised the mid‑year budget update, but people shouldn’t expect those rebates to go on forever.
Sara:
Treasurer, thank you very much for joining me again.
Chalmers:
Appreciate it Sally, all the best.
Sara:
Jim Chalmers is the federal Treasurer.