Interview with Laura Jayes, AM Agenda

29 November 2023

LAURA JAYES: In the meantime, the Reserve Bank Governor claims household finances are holding up. That's despite almost half of Australian mortgage holders saying they were in financial stress even before the interest rate rise on Melbourne Cup day. Michele Bullock has warned it's not over just yet saying it's very uncertain quote unquote Inflation will return to target over the next couple of years. Joining me now is the Shadow Finance Minister Jane Hume. Jane thanks so much for your time, Michele Bullock is that anchored in reality, do you think that's what most people are feeling at the moment?

JANE HUME: Well, I don't want to pass comment on Michele Bullock. What she's seeing in statistics, certainly what we're hearing on the ground is that Australians are doing it really tough right now and that the lead up to Christmas is going to be very difficult for so many Australian families. We have the Salvation Army in just yesterday who were telling me that around 62% of Australians are feeling stress in their finances more now this year than they were last year and we also know that every time that varies an interest rate rise, but the number of people seeking hardship programs from their energy providers and seeking services from charities goes up, there is a direct correlation. Now you can't blame Michele Bullock for doing what is essentially her job. She has one job and that is to get inflation back down to the target band and she has one tool in the shed to do it and that is interest rates, which is why we've been calling on the government to do its fair share of the heavy lifting by developing a plan to tackle inflation, not peripheral stuff, not tinkering around the edges, a plan to tackle installation because otherwise Michele Bullock is going to be sheeted with blame for doing her job, which is to get inflation back down to that target band and she has said that she has a low tolerance for leaving inflation higher for longer with good reason. Inflation is the thief in the night. It eats away at your savings. It erodes your purchasing power. It reduces your standard of living and it reduces your quality of life. We must reduce inflation. It should be the priority of this government. Unfortunately, it seems to have taken its eye off the ball and has priorities elsewhere.

LAURA JAYES: Okay, what is the fiscal solution that you're talking about? Perhaps a pause in the petrol tax would that help ease the cost of living or would that be inflationary? You're talking about not doing things around the edges? So what are you talking about?

JANE HUME: Well, that's a very good question. Surely with all the resources of the Treasury behind him, Jim Chalmers can come up with a plan to reduce inflation. We can already see the rumblings on the Labor backbench, who are now seeking consultations with Jim and Katy Gallagher, so that they can do more about the cost of living which is affecting their constituents. They're hearing on the ground that this is issue number one, two and three, and yet, whatever it is that Katy and Jim say that they're doing is having no difference whatsoever.

LAURA JAYES: Backbenchers apparently Jane as well, sorry, sorry to interrupt. backbenches, apparently, you know, finding it pretty hard to defend stage three tax cuts. How would you defend that?

JANE HUME: Well, isn't that funny? Isn't it funny that it's always the case that labor find one solution to every problem, which is to raise taxes. If they cut the stage three tax cuts, that would be a specific breach to a promise. In fact, Katy Gallagher said specifically in the chamber, or just a couple of weeks ago, that the stage three tax cuts were in fact cost of living relief. We know that real disposable income has decreased for three reasons: increased mortgage or increased interest rates, or inflation, and higher taxes under this government. At the beginning of this year, Anthony Albanese said that his New Year's resolution was to tackle the cost of living. Well, here we are, it's nearly the end of November. He has on every measure, he has failed in that objective, either he didn't mean it or he doesn't know what to do with it. Jim Chalmers needs to come up with a plan to tackle inflation directly. This should be the number one priority.

LAURA JAYES: What about migration? We speak about this every fortnight. What's the solution?

JANE HUME: We do, we do and there is no doubt that the nexus between migration and increased demand in the economy, overall demand economy is being drawn. That there is the nexus between migration and demand for housing has been or whatever all of that is providing additional additional pressures. The fact that we have a migration system that does seem to be out of control, something that the government have washed their hands on, they said it's demand driven, it's not our problem. That doesn't seem to be a rational solution to a very serious problem. There are things that the government can do in productive capacity to the economy, rather than taking away productive infrastructure and instead of spending money on boondoggles like the Suburban Rail Loop, it could increase productive capacity by maintaining those infrastructure investments that are going to deal with a rising population and congestion in our suburbs. It could reduce spending, more importantly, no rein in spending because let's face it, Australian families are making really tough decisions right now about their budgets. Perhaps it's time that the Treasurer made some pretty tough decisions around his.

LAURA JAYES: Well, not according to Michele Bullock. Not every family is having to make those difficult choices. We will probe that a little deeper later in the program, Jane Hume, great to see you.