KATY GALLAGHER:
I’m starting off today, so thanks, everyone. Thanks for coming. Merry Christmas, almost, good to see you all here.
Today we’re just here to talk about some numbers in MYEFO, which, as you know, will be released in its entirety tomorrow. MYEFO will have $14.6 billion worth of savings and reprioritisations contained in it.
These include some of the significant reforms that we’ve done that were delivered through the parliament in aged care, also through defence reprioritising within their budget that they have available to them, but also in some other areas like the Indigenous Advancement Program to assist in paying for the remote employment service that was announced on Friday. There’s some better targeting of residential aged care funding, some renegotiating of the COVID‑19 vaccine supply agreement. There’s been some reprioritisations in education with the Townsville City Deal to support the Reef HQ construction, and again savings across home affairs and employment as well.
This brings to total $92 billion in reprioritisations and savings since we came to government. Every single budget or budget update, we have taken this approach to find savings to make sure that every dollar spent is going to the highest quality programs, and you will see that in MYEFO tomorrow.
There’s also the continuation of the unavoidable spending that we’ve inherited since coming to government. These are often ongoing programs that had a funding cliff or had no ongoing funding attached to them. This obviously was a feature of the former government’s budgeting where they sought to reduce costs or make it look like the budget was in better shape than it actually was.
So, there’ll be a further $8.8 billion in unavoidable spending, which really goes to services and programs that the Australian people rely on – extra going into the PBS for listing of new drugs for health terminating programs, including aged care COVID support, an important uplift to the AEMO digital systems to ensure energy security.
There’s been some increases in some of those cost pressures on infrastructure projects, some extra investments going in to support the NDIA and the reforms that we have done to the NDIS, some legal settlements and some extra investment going into DVA and the War Memorial to sustain their operations.
Again, when you look at this, over all of the updates since coming to government, that’s about an additional $48 billion in unavoidable or legacy spending since we came to government. Over the past 2 and a half years, at every budget or budget update, we’ve found savings, we’ve reprioritised. And we’ve dealt with billions and billions of dollars in ongoing spending that was never provided for.
We’ve also delivered, importantly, the biggest structural saves to the budget that would have been seen over the past decade. Aged care and NDIS, those important reforms that we got through the parliament this year are so important to ongoing budget sustainability.
Now, the biggest risk facing the budget and the biggest risk facing Australians right now is Peter Dutton’s nuclear scheme. His own costings, the Liberal Party’s own costings show that even though nuclear power plants are decades away, Australians will be paying for it straight away. Higher bills, fewer jobs, a hit to growth and worse for the environment.
In addition, the Shadow Treasurer has been out this morning with some extraordinary comments saying that there is no point spending on manufacturing or housing. Well, we disagree. We think a future made in Australia, we think dealing with the housing shortage that exists in this country is a Commonwealth responsibility and we are happy to be at the table and investing in Aussie jobs and homes for Australians. He’s also been unable to outline where the billions, hundreds of billions of dollars in cuts that they have announced and he has confirmed this morning will be coming from.
The biggest risk when we’re talking about the budget, the budget sustainability, all aspects of the budget, including important programs and services to the Australian people, is under threat by the plans that Peter Dutton has.
JIM CHALMERS:
Thanks very much, Katy. I wanted to pay tribute to Katy and her work and the work of the Expenditure Review Committee that Katy helps lead. We have found, as Katy said, almost $15 billion in savings in this update and $92 billion in savings since elected.
Remember, that compares with precisely no savings in the Coalition’s last budget. Savings and spending restraint have been hallmarks of our responsible economic management. Two surpluses in the first 2 years and smaller deficits than we inherited from our predecessors are a demonstration of those savings and that spending restraint, and that’s why it’s a hallmark of our responsible economic management.
Without that combination of savings and tax reform and spending restraint, we wouldn’t have got anywhere near the very positive turnaround that you’ll see in the mid‑year Budget update tomorrow. In a cumulative sense, the budget is in much better nick than what we inherited from our predecessors.
I’ll remind you just of the first 3 years that we’ve been in office: in our first year, we turned a $78 billion deficit into a $22 billion surplus. In our second year, we turned a $56 billion deficit into a $16 billion surplus. And in our third year, we’ve taken a $47 billion deficit from the Coalition and turned that into a much smaller $28 billion deficit in the Budget this year, and we’ll update that number tomorrow.
As Katy rightly identified a moment ago, there’s the near‑term pressure that we’ve taken off the Budget, but we’ve also worked at the same time on some of the bigger structural issues – and we’ve talked many times, Katy and I and all of you here, about the 5 big structural pressures on the Budget. Katy mentioned 2 of them, NDIS and aged care. But we’ve also made very, very substantial progress getting the debt down. That means we’re paying much less interest on that debt, tens of billions of dollars of interest repayments saved because of our responsible economic management.
This is not an end in itself. It’s how we make room for the nation’s priorities and it’s how we accommodate the very substantial pressures on the budget as well. What we’ve been able to do is to make room for our priorities and also for the pressures on the budget, some of them unavoidable.
Tomorrow, for example, a big feature of the mid‑year Budget update will be the estimates variations. Just to run through some of them: Age Pension indexation – $3.6 billion write up, the DSP – $3.6 billion, more kids in early childhood education – $3.1 billion, schools – $2.6 billion, Medicare and the PBS – $2.3 billion, indexation of income support payments – $2.1 billion, an extra $1.8 billion for disaster relief that I was talking to people in tropical Far North Queensland about late last week, as well as a multibillion dollar estimates variation which goes to extra demand for aged care services.
These are pressures but they’re also priorities and we’ve made room for them. You’ll see that in tomorrow’s mid‑year Budget update.
When the Coalition says that this is overspending, what they really mean is they’re coming after Medicare and medicines and pensions. If Angus Taylor and Peter Dutton think that extra spending for Medicare and medicines and pensions indexation is wasteful spending, then they need to come clean this week to the Australian people and say how much will they cut from Medicare and medicines and pensions and some of these other important areas like disaster relief or supporting veterans with the support that they need and deserve.
Every single time that Angus Taylor says that this is wasteful spending, he needs to be asked how much will he cut from Medicare and medicines and pensions indexation? Because that’s what he really means when he says that this is wasteful spending. Medicare and medicines and pensions are not safe under the Coalition.
We know that they are a risk to household budgets, because we know their record. We know that Peter Dutton came after Medicare last time. We know that they come after wages every time. We know that they will push up electricity bills with this economic insanity, which is Peter Dutton’s nuclear fantasy.
Despite all the pressures on the budget, we’ve delivered 2 surpluses, smaller deficits than we inherited and less debt as a consequence.
More broadly, if you look at the progress that the country has made in the last 2 and a half years: inflation down, wages up, a million jobs created, unemployment with a 3 in front of it, the gender pay gap the narrowest it’s ever been, with more work to do. A tax cut for every taxpayer, energy bill relief for every household and still those 2 surpluses, still that ongoing responsible economic management which is the defining feature of our government and will be the defining feature of the statement tomorrow.
I wanted to flag a couple of other things before Katy takes all of your questions. The first one is that this MYEFO tomorrow is part of a big week in the economy. We’re sprinting to the finish, all the way to Christmas.
I wanted to flag with you that later this afternoon we’ll be releasing the Tax Expenditures Statement. You know that we’ve put a lot of effort into renovating that, making it more useful to you, making its insights more valuable, so I wanted to flag that. We’ll be releasing that hopefully in the next couple of hours, if we can.
There’ll also be the Population Statement that we’re obligated to release in the summer. We’re looking to release that at some point this week as well, probably closer towards the end of the week than the start of the week, given everything else that we have on now.
When it comes to the Tax Expenditures Statement, you know that that’s a requirement under the Charter of Budget Honesty. It’s an important piece of analysis. It’s not a statement of policy intent.
You already know that we’ve got a substantial agenda when it comes to tax reform, and Andrew Leigh will also have a bit more to say later today about our country by country reporting that’s part of our multinational tax reforms as well. But I wanted to flag that with you. It will provide lots of detail on the tax system and what it means for the Budget, and we’ll put that out in the next couple of hours.
The last thing I wanted to briefly touch on is my friend Chrystia Freeland, the Finance Minister of Canada, has resigned overnight.
Chrystia is such a great friend to me and to Australia, and I really just wanted to wish her well. Over the last 2 and a half years, I’ve worked really closely with Chrystia Freeland. She’s an absolute legend and she’s been a great supporter of Ukraine, a big part of our efforts on the global economic stage.
We have an extremely strong relationship with all of our Canadian counterparts. But I really wanted to say that I wish Chrystia well. I look forward to working with her successor to further develop the important economic relationship between Australia and Canada, but also the big role that Canadian friends play on the world stage, particularly when it comes to the G20 Finance Ministers gatherings.
Happy to take your questions.
JOURNALIST:
You always compare the budget position now to what you inherited, to COVID budgets, COVID‑level spending, you say $56 billion deficit to a 16 surplus. Is it not equally fair to say you’re going to turn a $16 billion Labor surplus into a $33 billion labour deficit?
CHALMERS:
I’m not sure where you got the $33 billion number from.
You’ll see what the deficit is for the year that we’re in right now. I’d caution you against making assumptions based on numbers that other people make up. You’ll see the numbers tomorrow.
But what you will see, the reason we compare the budget that we inherited with the budgets and updates that we’ve been delivering is because the country’s made remarkable progress cleaning up the mess that we inherited.
You make the point about COVID budgets. That doesn’t explain all of the deficits that our political opponents handed down before that. They promised a surplus in their first year and every year. They went precisely 0 for 9. They delivered no surpluses.
We’ve been here 2 years and delivered 2 surpluses. We’ve tried to get those deficits down compared to what we inherited. There’s been a lot of progress made. But you can’t clean up the whole mess in one term. This is an ongoing effort.
One of the reasons Katy and I work together so closely with the ERC and others is because we know that the important task of budget repair and responsible economic management is never finished. Some of the pressures on the budget are intensifying rather than easing. We’ve tried to run you through some of those today.
JOURNALIST:
Given those pressures on the budget and the unavoidable pressures you speak about, the estimates variations. If you do hand down a third budget or if you do get a second term in government, is your goal still surpluses and balanced budgets or is it merely dampening the deficits moving forward?
CHALMERS:
The fiscal strategy set out in the mid‑year update and in the Budget papers and one of our highest priorities has been to get the debt down. There we’ve made some pretty extraordinary progress getting the debt down from what we inherited.
We do that for its own reasons, but also because we want to pay less interest on the debt. Those tens of billions of dollars that we’ve saved in debt interest can go to budget repair or they can be invested in other priorities like housing, like cost‑of‑living relief and the like.
We’ve worked very hard, consistent with our fiscal strategy, to try to get the debt down. We try to deliver the best set of books we can given the economic circumstances. That’s where what we’re doing in the Budget is so closely related to what we’re doing and the progress we’re making on getting inflation down.
The Reserve Bank Governor has said our 2 surpluses are helping in the fight against inflation. We’ve tried to get the budget in as good a nick as we can, to try to make sure that we can not add pressure to inflation.
That will be our ongoing effort.
JOURNALIST:
Do you share economists concerns about the Aussie dollar falling below the 60 cent mark US?
CHALMERS:
The dollar has been volatile in recent times and it’s been a little bit lower than what people have been accustomed to. But it can be an important shock absorber in our economy.
It’s frequently just a reflection of our own economy. It’s frequently a reflection of what’s happening in the US and what’s happening in China and how those considerations net out typically determines where our dollar is at.
I try not to be a commentator on the dollar. I try not to make predictions. But we’ve seen it’s been bouncing around the mid‑60s a little, bit lower than that in recent days for a range of reasons. I’m not especially troubled by it.
JOURNALIST:
Just a bit of a different one. Hugh Marks has been appointed as the ABC’s Managing Director. Given his controversial departure from Nine and the toxic workplace scandal that appears to have begun during his tenure. Is this a good appointment?
CHALMERS:
This appointment is made by the ABC board and we support the independence of the board. This is one of the tasks that we entrust the ABC board with and they’ve come to this view unanimously. They’ve considered a range of candidates and determined that he’s the best available candidate.
I don’t propose to second guess that.
JOURNALIST:
Senator Gallagher, you talked about that $92 billion in savings since coming to office. Do you have a similar figure for spending based on decisions taken by government over the same timeframe? And you mentioned lawsuits costs as one of the pressures, legal settlements. Are you able to go into any detail about what those are and what they relate to?
GALLAGHER:
On the second point, that’s relating to the McDonald wages class action settlement that occurred over, I think, from 1933 to 1971. So, it’s settling that matter.
In relation to spending, I don’t have that figure with me here today, but would be able to talk about that tomorrow when the MYEFO is released.
Governments are always going to have to spend and we’ve, Jim and I, have tried to bring the approach of making the best assessment of high quality spending that matches the Australian people’s priorities.
When we are making decisions like that, it’s not just about additional spending. We’re looking at ways that existing expenditure can offset some of that or be repackaged for it.
I’m very confident that the approach that we’ve taken since coming to government has been the right one where we acknowledge there’s pressures on the Budget. There are no shortage of good ideas coming forward from not just ministers but from people right across Australia. Our job is to weigh that up, make some decisions about what additional spending is required, but then look at how we can offset some of that.
JOURNALIST:
Minister Gallagher, you talked about billions in ongoing spending that was never budgeted for. Labor’s had now 3 budgets nearly 3 MYEFOs, wouldn’t there have been opportunity to deal with all those funding cliffs over the forwards already? Or is Labor also looking to make the Budget look a bit better than it was? And if I could, Treasurer tomorrow, if there are a lot of money in decisions taken but not announced, should Australians assume cost‑of‑living relief is on the way in the new year?
GALLAGHER:
So, to your first question, Clare, I think the approach we’ve taken is that every update we put a call out, essentially, to assess what are the programs that are terminating. So, we’ve tried to deal with them a bit separately than requests for, say, new spending, because they are ongoing programs that people are relying on.
We have public dental programs, we’ve got support programs in aged care and so we deal with them as they come up. They’ve all got different expiry arrangements.
So, in, say, in the Budget that we did in October 22, we were looking at in the next 6 months, what were those terminating programs. So it’s an ongoing process, essentially, to uncover all of those programs that don’t have ongoing funding and then to try to deal with those.
I think our approach has been quite different. If we have an ongoing program, we make provision for it.
CHALMERS:
Just on the decisions taken, but not yet announced, what you’ll see tomorrow is a number which won’t stand out to you. It won’t be particularly unusual compared to earlier budgets and updates.
When it comes to cost‑of‑living relief, the focus is on rolling out the very substantial cost‑of‑living help that we’ve already budgeted for and already announced.
As we’ve said on a number of occasions, we keep that under constant review from budget to budget. When we can afford to do more to help people who are doing it tough, we generally and genuinely try to make room for that.
So people should expect us to continue that approach into the future, just like we’ve had that approach in the past.
One of the reasons why people are getting a bit of help in their household budgets right now is because of all of the effort we put in in May, whether it’s the tax cuts for every taxpayer, energy bill relief, cheaper early childhood education, cheaper medicines, student debt relief announced not that long ago. All of these things are about taking some of the sting out of these pressures on household budgets. That’s rolling out right now.
JOURNALIST:
Treasurer, could we have your response please to reports that there has been pressure on government departments and bureaucrats to quietly defer spending in the current financial year to bring down deficits in the run up to the election?
CHALMERS:
From every budget to every update, we always try and make sure that the spending is profiled in the best way. Sometimes that’s unavoidable, there’s often slippage in spending in big projects in particular. That’s been a feature of budgets of governments of both political persuasions over a long period of time now. But there hasn’t been a sort of an unusual effort on that front this year and this mid‑year Budget update, we do that from time to time, we make sure that the profile reflects our priorities and reflects the reality of trying to get some of these big investments out the door.
JOURNLIAST:
Treasurer I guess developed countries, advanced economies across the world are facing greater, voters are wanting have greater demand for government services. Do you think there needs to be conversation in the next term government about revenue raising measures given that there is a greater demand for government services from the electorate?
CHALMERS:
The Australian people are right to expect a decent level of services and what we’ve tried to do is to make room in the Budget to provide the level of services that people need and deserve. Whether it’s aged care, Medicare, early childhood education, the care economy more broadly, this is going to become an increasingly important part of our economy as our population ages in particular.
We’ve tried to make room for that, tried to make sure we can pay people in these important parts of our economy appropriately so that we can recruit people into these areas.
That’s just the reality of the way that our country and the demographics of our country is changing and what we’ve shown an ability to do over 3 budgets now, and this will be the second update, is the combination of spending restraint elsewhere, finding all of those savings, some modest but meaningful tax reform means that we can pay for these priorities.
The focus for us is we have some unfinished business when it comes to some of the tax measures that we’ve already announced, multinationals, super tax concessions and the like and that’s our focus rather than new elements of an agenda on that front.
JOURNALIST:
You mentioned a slew of cost‑of‑living measures that Labor has introduced in your response to Clare. Why then do you think that 40 per cent of those surveyed in the essential poll today say that they feel worse off than they did 3 years ago? How are you going to counteract that sentiment as we head into an election, especially in the deteriorating budget position?
CHALMERS:
We acknowledge that people are doing it tough and more than acknowledge that we’ve been responding to it in all of the ways that we’ve mentioned a number of times now.
It’s the whole motivation for the tax cuts, the energy bill relief and all of the other ways we’re helping with the cost of living is we recognise that people are under the pump. That’s why we’re responding and making room in our budgets for cost‑of‑living help.
When we came to office, people were already going backwards very substantially. Living standards were falling, real wages, I think had fallen for 4 or 5 consecutive quarters when we came to office, and we’ve been working very hard to try to turn that around. But we acknowledge that people have got a lot of ground to make up in their household budgets. We know that and that’s why cost of living and beating inflation are our highest economic priorities. They’re our biggest focus because we acknowledge it has been a difficult few years for people in their household budgets and the choice for governments is whether or not to try to help, which has been our approach, or whether just leave people on their own, which is our political opponent’s approach.
JOURNALIST:
You’ve said many times that tomorrow won’t be a mini budget. And now that we’re on MYEFO eve I’m going to ask again. Can we expect any new announcements tomorrow in cost‑of‑living relief? If not, how soon could those measures be taken? You say you’ll find room to afford it where you can, but how soon could you see new measures rolled out and are we going to get another Budget?
CHALMERS:
First of all, on the big new measures front, I’ve made it clear on a number of occasions now our position on that. This won’t be a big budget, it won’t be something that you would consider to be a mini budget. It’s how we account for the various announcements that we’ve made and pressures on the budget. It’s how we update our forecasts. People should have measured expectations on that front. But we are constantly looking for ways to make life easier for people. We are constantly looking for ways, affordable, responsible ways, that we can help people with the cost of living. The appropriate time to budget for that is not usually in the mid‑year Budget update, it’s usually in the Budget itself.
JOURNALIST:
Are you going to have a Budget?
CHALMERS:
That’s our expectation. Katy and I have been working simultaneously on the –
GALLAGHER:
It’s a seamless transition from MYEFO to Budget.
CHALMERS:
That’s right and we’ve been in this room, a couple of doors down here for hours and hours on end in the last few weeks. Some of that’s been mid‑year Budget update prep, some of it’s been budget prep because we’re on the clock a little bit. We’ve got a Budget in March, we’ve got a mid‑year Budget update tomorrow. So a lot of the work’s been happening simultaneously because it’s our expectation that we’ll hand one down.
JOURNALIST:
There’s been a lot of effort this term to find savings in the NDIS and you’ll have a new Minister there soon. Is this work now done or is the NDIS an area for future pursuit of savings, if you can get them? And secondly, while taking your point about the tax expenditure statement not being government policy, can you tell us what are a couple of highlights in your mind from that statement?
CHALMERS:
Katy will go first on the NDIS and then I’ll do the TES.
GALLAGHER:
On the NDIS, and I tip my lid to Bill Shorten for all the work that he’s put in on this in this term and working with state and territory ministers to deal with some of the challenges in the NDIS. His approach has been to make sure that the NDIS remains a sustainable program for people who need its services but that is manageable in the budget context. We’re confident that the reforms that passed the parliament are putting it on track. There’s more work to do with states and territories in terms of the implementation of that through rules and other agreements that we have with them.
But the early signs are pretty pleasing on the NDIS front, certainly in achieving that 8 per cent growth target. So, coming down off 14 and 15 per cent growth, that is looking very positive. In that sense, the reforms that were outlined are working. There’s extra investment that will go in to make sure that the NDIA is able to implement the reforms and keep that on track but it is very positive.
CHALMERS:
That’ll be reflected in the update tomorrow. I encourage you to look for the figure that shows that growth in the NDIS is lower. That’ll be reflected in –
JOURNALIST:
Can you say how much?
CHALMERS:
We can tomorrow.
JOURNALIST:
Will it be the same as the actuary’s report?
CHALMERS:
It is based on some actuary numbers. What you’ll see tomorrow, why don’t we just say it?
What you’ll see tomorrow is growth in the NDIS is $1.4 billion lower than at budget time. That’s a new number that’ll be in the update tomorrow.
You’ll see that there was announcement from Bill and I joined Katy in her words, tipping our lid to Bill for his work on the NDIS, there’s some investment today which is in the paper, you’ve seen that. But we’ve also been able to slow growth a bit more in the Budget update and that’s an important part of our structural efforts. The near term efforts are important, but the structural efforts are important as well.
JOURNALIST:
Tax expenditure?
CHALMERS:
When it comes to the Tax Expenditure Statement, what you’ve seen is that the kind of innovations in the first couple will be replicated in this one.
It’s really about making sure we give as much information as we can. I think the highlights really are our ability to tell you more about the distribution of some of these tax concessions.
But again, we’re providing it, flagging it now, providing it today, giving you lots of time to have a good look at it but it’s not a statement of policy intent. I can’t really say that enough. It’s a really important piece of analysis but I encourage you not to read too much into additional policy steps.
JOURNALIST:
Treasurer, after months of steady growth, we’ve seen consumer consumer confidence slip today. Does that concern you and does it show that people are losing faith in the economic rebound?
CHALMERS:
I don’t think so. I have seen those consumer confidence numbers. I do watch them pretty closely.
What we’ve seen over the course of this year is a gradual and really important recovery. On most occasions those 2 institutions point to the role of the tax cuts in slowly rebuilding confidence. What we see around this time of the year, and it’s been especially pronounced in that one you’re referring to and the one before it from their competitors, is after the Black Friday sales, the Black Friday really distorts the way people think about their big purchases. It’s been in the last few years a bigger and bigger part of the volatility in spending around this time of the year.
What it means is before Black Friday, there’s a lot of people saying they’ve got the confidence to buy a major household item or something like that. Then afterwards you see the big correction. I think those 2 are really about that.
I’d really direct you and encourage you to interact with the longer term trend. We’ve seen it coming back a bit. It’s still not gangbusters, but it has been recovering. I think only a few weeks ago it was the highest it had been for years. I think some of the tax cuts certainly, and some of the cost‑of‑living relief is part of that. It also reacts to news we get in our economy. As you know, all of you know, the last National Accounts were especially weak. And so it’s probably partly a reflection of that as well.
JOURNALIST:
Just following up Clare’s question about the funding cliff given next year will be the final year of those forwards that we had from that pre‑election Budget. Does that mean you will uncover all the spending cliffs, you can’t claim any more after that? And also on the reprioritisations, I see again it’s shifting money around in defence to cover the stuff that we’re sending to Ukraine, that’s up to $1.3 billion worth now of defence equipment gone over there. Is that the wisest way to fund defence, you know, given the strategic environment that we’re in at the moment?
GALLAGHER:
Katina, so on the defence front, they are provided, unlike other departments, with an ongoing investment through their IIP program that recognises that they have big costs that come about as they are implementing the Defence Strategic Plan. And within that there is a level of expectation that they are able to manage timing and reprofiling of investments but we have invested heavily in national security since coming to government and right across the board, whether it be defence, billions of dollars, but also across our security agencies, recognising the very challenging geostrategic world we’re living in right now. So I think that works for defence and it’s an expectation, a reasonable expectation from government that we manage some of those costs.
Now one of those big areas in the reprioritisation is workforce training and retention, which is obviously a key priority for them to make sure we’ve got the workforce we need and so that’s a priority and they are able to meet some of those costs.
Your second point on terminating programs, I would expect that we have uncovered most of them. But for example, you’ll see this reflected in MYEFO because it was one of the announcements that’s been made since Budget, but the national legal assistance agreement, billions of dollars had zero provided for it at the end of that expiring of that agreement now under the former government, seriously suggesting that community legal centres and those sorts of services are just going to close their doors on July 1st.
It’s an unbelievably negligent way of providing budget sustainability when you have these massive lumpy costs that just drop off. And so I would expect we’ve found most of them, but that agreement, for example, is 5 years, so there may be some as they come to expire that we would uncover some, but I think certainly in two‑year and three‑year programs, we’ve probably uncovered most of them.
JOURNALIST:
Just to continue on with what Michelle was asking about, the tax expenditure statement, presumably it once again has very large numbers related to negative gearing. You say there’s more sort of definition around the spread of who benefits and who doesn’t. These statements have traditionally, as long as I can remember, always come out at the end of January or the beginning of February. It’s tempting to read into this that you want to get this out there earlier so people can consider it. Is that your sort of political goal with why you’ve timed it this week?
CHALMERS:
I think it’s important not to be cynical about it. What we’re doing here is it’s ready to go and when it’s ready to go, I like to get it out the door.
The to do list is long enough as it is without stuff hanging around unnecessarily. It’s ready to go. I think it’s ready to go a little bit earlier than usual and so when it’s ready to go, I’d like to tell you all about it so I’ll be doing that today.
JOURNALIST:
Can you just walk me and Australians through how you got to this multi‑trillion‑dollar nuclear cost from the Opposition?
CHALMERS:
What you’re talking about there is the growth sacrificed out of the numbers provided by the Coalition at the end of last week and what that’s based on is the low growth scenario in the work that’s been done.
They don’t dispute that, by the way. They’ve had the best part of a week now to say that that is wrong.
The economy in those numbers is $294 billion smaller in 2050, the cumulative lost output between now and mid‑century is $4 trillion, they haven’t disputed that and those are numbers which come from the scenario that they’ve adopted.
What that means is what they are proposing is less growth in a smaller economy with less energy and less industry and higher energy prices. This is the economic and fiscal absurdity of that trash that they put out at the end of last week.
A lot of you have been around here longer than me. It is hard to recall a messier, more absurd set of numbers than those put out there by the Coalition last week. For the Australian people who are kind of sifting through claim and counterclaim and big numbers, I’ll tell you the one most important thing that it means for them – higher electricity prices.
That’s because our political opponents, for reasons that are unfathomable to sensible people, have gone for the version of energy which is the most expensive, would push up power bills the most, would take the longest, would deliver only a sliver of energy and would turn Australia’s back on this remarkable combination of economic advantages and opportunities that we have and that’s why we saw that nuclear meltdown from Dutton and Taylor last week is because they finally had to come clean on the economic madness which is their proposal on nuclear.
It’s no surprise to us that it’s fallen in a heap and that’s because it’s mad. One more and then we’re done. We’re getting that look from up the back about how long the transcript’s going to be so we’ll take one more.
JOURNALIST:
Just quickly back to the NDIS, there are obviously a number of big changes ahead including transitioning to a needs based scheme which will result in thousands being moved on to yet to be announced for development Foundational Supports across the states and territories. I appreciate you are both in the numbers game but how are you balancing the needs of the 5.5 million Australians with disabilities with the pressures that you have on the Budget, obviously trying to get that scheme back down?
GALLAGHER:
We’re trying to create the system that works for everybody, so we’re trying to build a system where the NDIS isn’t the only offer in town which at the moment, if you have a disability or you require extra support because of the way the NDIS has developed, it’s kind of sucked up all the service system and the foundational supports are really about rebuilding that system that allows people to get the support they need but not necessarily be on the NDIS indefinitely and that’s going to be a big bit of work.
We’re making provision for it, but essentially I think the balance is how do you build a system that works for every person who has a disability and just doesn’t offer them a one size entry point? I think for people, particularly with young children, years ago in the ACT there used to be a therapy centre. If you had a speech delay or you needed occupational therapy, you could take your child there and have them supported and then transition out and that’s the kind of service system we need to rebuild.
CHALMERS:
Our big focus in the NDIS is on the people who need the scheme and spending on the scheme is still growing, but we’ve been able to slow the growth a little bit so that we get value for money and make the scheme sustainable so it can continue to deliver people into the future.
We’re in a very good conversation with the states and territories about how that is best done. I had a good conversation with the state and territory treasurers in this building a couple of Fridays ago and I think everyone’s got the same interest here, delivering for people number one priority and that means we’ve got to make sure that we can afford it and it’s sustainable.
JOURNALIST:
A quick one on public broadcaster funding announcements. In an environment of rising mis‑ and disinformation, particularly targeting the [inaudible] community and given the government’s stated goal of increasing social cohesion, what is the rationale for $80 million extra for the ABC and nothing more for SBS?
CHALMERS:
We have made a big new investment in the ABC and we’re proud of that and I pay tribute to Michelle Rowland for securing that funding.
We’re enthusiastic backers of public broadcasting, whether it’s the ABC or the SBS, we are enthusiastic backers and when we can afford to, we provide extra resources to both of those institutions.
In this case, the priority has been the ABC, $83 million over 2 years, followed by ongoing funding of $43 million a year, that’s a demonstration in our faith in the public broadcasting system, ABC and SBS together. Thanks very much.