Interview with Chris Kenny, The Kenny Report

2 November 2022

CHRIS KENNY: Shadow Finance Minister Jane Hume was at that event, and I asked the Victorian Liberal Senator why the proposed laws are extreme.

JANE HUME: Well, Chris, let's take a step back prior to the election, Anthony Albanese assured Australians that wages would rise under a Labor government. And in fact, what the Budget papers have said is no such thing will occur. In fact, they're suggesting that real wages won't increase over the entire term of this Parliament. And despite that, they're now introducing industrial relations reforms that could potentially make that worse. They've said it will drive wages up. We think that they will do no such thing. In fact, those IR laws that they're talking about, that old fashioned 1970s style patent bargaining will make things so much harder, particularly for small businesses who may never have had to deal with unions before because it will allow unions into their workplaces, sometimes for the first time. It will in fact, reduce competition between organisations. It will stop people striving to do better, striving to offer higher wages in some companies rather than others, so that labour mobility really won't occur. We think this is actually going to be a big step backwards in productivity and the progress of our economy rather than something that will push wages just to be sustainably higher into the future.

CHRIS KENNY: You're absolutely right. This is what Labor are arguing now. They’re saying that real wages are still going backwards and they say they'll still go backwards for a long while but they say their new industrial relations changes, their workplace laws will help industry right but by bargaining the push up and negotiate and demand higher wages. That seems a very, very risky strategy when you're looking at an inflation problem already, but I'll come back to that question. Why are these laws then described as extreme?

JANE HUME: Well, because we think that they're going to take the economy backwards rather than push it forwards. And of course, you know, let's face it, the only way to dig yourself out of a deficit crisis, which again, the government has not just said it will maintain but will make worse into the future into the not just over the forward estimates, but into the medium term. The only way you could reduce that deficit is through three things. One is raise taxes, which we don't think - we think that's the worst thing you could do to the cost of living crisis. Two is to rein in your spending. And three ways to grow the economy. Now we think reining in your spending and growing the economy is by far the best way of doing it. But if you want to grow the economy, the worst thing you could possibly do is to put these red tape restrictions on the way that businesses go about their daily operations. Now we think that this is actually going to make things far worse, far harder for businesses and potentially because of the complexity of these IR laws and our award system more broadly, it will slow down wage increases. These are companies that don't have human resources departments. So dealing with these, these incredible IR pressures now, industrial relations pressures, is going to make life so much harder for mom and dad businesses out there right across the country.

CHRIS KENNY: You're so right. I mean if we want economic growth, and we really need it badly now to recover from our debt crisis and to get on top of these other issues. You need less regulation, less government, not more regulation and more government so we'll see what transpires here, but I for one am very pessimistic. Now, you mentioned cost of living. We all know about the cost of living pressures at the moment and the fact that they're going to get higher. Tell us about this Senate Select Committee that's gonna travel the country and ask people about cost of living, why is there a need to do that? Don't we just need action?

JANE HUME: Chris, before the election, the Labor government, the then opposition, said that they had all the answers to the cost of living crisis, and they kept telling us what the problem is, but you know, there's no point pointing to the fire unless you've got a hose. The price of failure here is far too great for Australians. We've already seen mortgages go up again just yesterday and now a family with an average mortgage of around $750,000 is paying more than $1,200 a month more in their mortgages than they used to. But that's just the tip of the iceberg. We're hearing stories about things like power bills being- power prices and contracts being renegotiated for small businesses, but it's flowing through to the cost of goods that they're selling on to the consumer. What we want to do with this cost of living committee is find out the real sources of the cost of living crisis, go to the causes, not just the symptoms, and find practical, everyday solutions. And we'll do that right around the country because the cost of living bites, with different demographics, in different geographical locations. We want to find out just how people are doing, where they're finding it tough and find practical solutions because we want the government to succeed here. They said they were going to, they've showed us no economic plan to do so. But the cost of failure is far too high a price to pay.

CHRIS KENNY: You're so right when it comes to these different demographics because you've got to listen to people in the suburbs and the regions because that's where people are feeling the electricity price hikes, and of course the food price hikes and the interest rates if you only listen to the teal seats where people are living in multimillion dollar houses in high incomes, I can tell you that's not where electricity prices and interest rate rises.

JANE HUME: Well that's right and that of course those regional and rural states are feeling the double pain at the moment because they've had the guts of their infrastructure projects ripped out in this budget. And instead, you know, funneled off to Daniel Andrews $2.2 billion Suburban Rail loop which even Infrastructure Australia, you know, hasn't approved and the Victorian Auditor General says the cost benefit analysis doesn't stack up. So rather than getting that productive capacity out to the regions where it could be doing some real good you know, it was the regions as David Littleproud will tell you that got us through the worst of the economic crises in the last couple of years. Now they're being punished for it, without having that proper productive capacity investment that was so important, such an important feature of the Coalition's infrastructure plan.

CHRIS KENNY: I like to be optimistic, but I fear we've got a difficult year or two ahead of us. Thanks so much for joining us, Senator.

JANE HUME: Great to be with you, Chris.