SAMANTHA DONOVAN:
Jim Chalmers, the value of Australians' income is going backwards due to inflation. We know prices are surging, housing for both renters and borrowers is exorbitant. How much longer are Australians going to continue to suffer in this economy?
JIM CHALMERS:
Inflation still is the primary challenge in our economy, and that's what makes it the primary focus of our economic plan, and also the upcoming Budget in May. There's no use sugar-coating the fact that inflation will be higher than we'd like for longer than we'd like. And that's one of the reasons why we have had these interest rate rises since before the last election, as the Reserve Bank takes its decisions independently to try and get on top of these inflationary pressures. And that's why today's decision to leave rates on hold this month, I think, will be a welcome reprieve for a lot of Australians, but we know that people are still doing it tough - they're still under the pump. And that's why we're working around the clock to try and give people a little bit of relief from these cost‑of‑living pressures where we can do that responsibly.
DONOVAN:
How long though do you think the rate rise reprieve will last? You're saying inflation is continuing to be a problem, are you expecting there'll be more rate rises this year?
CHALMERS:
Well, it remains to be seen. And certainly in the statement issued by the Reserve Bank today, they made it clear that today's decision is to give them the opportunity to take stock, and to see what the impact of the interest rate rises that are already in the system is, and to also see the impact of this pretty substantial global uncertainty that we have at the moment. So that's how they've described the decision that they've taken today. I don't second guess or pre-empt decisions that the Reserve Bank takes independently. I think today's decision will be a welcome reprieve for a lot of people. There will be a sigh of relief in the community but we understand that people are still under the pump.
DONOVAN:
Have you got any intel or forecasts yourself on when the rate of inflation will come down to match wage rises?
CHALMERS:
We will update those forecasts in the Budget. The Budget is not that far away now, only about five weeks or so. And in that Budget, we'll update all of the numbers for inflation, for wages, for all of those numbers. We have seen the beginnings of some wages growth in recent times and that's a welcome development because wages have been stagnant for too long in our economy. But we need to see that inflation moderate as well. The nature of our inflation challenge has been changing. We're conscious, in particular, of the pressure from energy prices and rents, and some of these other sort of core areas of household spending. And so what we're trying to do in the Budget is to provide some relief, for example, with energy bills so that we can take some of the edge off those rising energy costs and make life a little bit easier for people.
DONOVAN:
Dr Chalmers, we've heard just in the last day or so from the CoreLogic data that home prices in Sydney, Brisbane, Melbourne, Perth are going up again, so making it hard for anyone wanting to get into the market - renters as well. How concerned are you by those increasing prices? Would you have liked to have seen a bigger contraction in the market for longer perhaps?
CHALMERS:
I wouldn't necessarily see it that way but I do think we've got a housing affordability challenge in our economy. I think that's self-evident and the best way to deal with that is to build more homes and that's why it beggars belief that when we proposed to the Parliament a program of building a substantial amount of homes - particularly at the social end that will have an impact right through the system - that the crossbench and the Opposition voted against that. That was a great shame because the nation needs more houses. We've got our fair share of challenges in the construction sector and we've got to get building because we don't have enough houses. That's why vacancy rates are low. That's why rents are high. It's why the housing affordability challenge is so acute. We want to work with people in the Parliament to begin to deal with some of these issues and unfortunately, disappointingly, that cooperation hasn't been there.
DONOVAN:
Dr Chalmers, on the Budget, in his election speech of course, we recall the Prime Minister promise no one would be left behind under a Labor Government. We know that the JobSeeker payment is still $50 a day, ACOSS is calling for it to go up to at least $76 a day in line with the pension rate. Are we going to see any movement on that in the May Budget?
CHALMERS:
There are a series of decisions that haven't yet been taken for the May Budget. I think people do appreciate that there's pressure on the Budget and that we will do whatever we can in a responsible way to try and ease some of these cost‑of‑living pressures. We put together the Economic Inclusion Advisory Committee to provide advice, including from ACOSS and others about some of these really important issues. We've received that report now, I'm working through it methodically with my colleague Amanda Rishworth to see what if anything might be able to be done in the near term but I've got to be upfront with your listeners, there are a lot of pressures on the Budget, we will do what we can to make life a bit easier for people and we will go through the report that we've been provided on JobSeeker and other issues with that in mind.