Interview with Michael Rowland, ABC News Breakfast

14 May 2024

MICHAEL ROWLAND: Jim Chalmers is putting the finishing touches on his budget in which he is promising cost of living relief to all Australians in what will be the Albanese Government's last full budget before the next election. The Treasurer is walking a pretty fine line between keeping inflation down and providing assistance for those doing it tough and while the Budget forecasts the first back to back surplus in more than 15 years, Jim Chalmers says that comes on top of, not at the expense of those measures. It is a highly anticipated Budget. We'll hear from the Treasurer later this hour here at Parliament House. But first, let's bring in the Shadow Finance Minister, Jane Hume here in this chilly Senate courtyard this morning. Jane Hume, very good morning to you.

JANE HUME: Good to be with you, Michael.

MICHAEL ROWLAND: So back to back surpluses. Not a bad thing?

JANE HUME: Well, I think that if you speak to ordinary Australians they'll tell you what we're all feeling and that is two years of a Labor Government and Australians are poorer. What we want to see in this Budget is restoring our standard of living and taming inflation, fiscal restraint, bringing back that fiscal discipline, those guardrails around the Budget that we've seen as a hallmark of Coalition Budgets in the past and then, of course, restoring opportunity and prosperity to all Australians, but that doesn't seem to be what we're seeing. In fact, I would agree with Anthony Albanese when he says that this is a true Labor Budget, through and through. It is high tax, high spend and Australians will be worse off for it.

MICHAEL ROWLAND: But in terms of Budget surpluses are a good thing. It's the last back to back surplus since the global financial crisis.

JANE HUME: Well, Jim Chalmers is returning a surplus not because of his hard work, but because of the hard work of ordinary Australians. This is a surplus that's been gained on the back of high commodity prices and more importantly, because of bracket creep, because people are paying more taxes, because of the inflation that Jim Chalmers has failed to tame. And he's passed two Budgets, he's passed two Budgets, have failed to do what they should set out to do. This one looks like it's going to be no different.

MICHAEL ROWLAND: I'm glad you mentioned bracket creep, because I want to talk about the stage three tax cuts. The reworked stage three tax cuts will be a key feature of the Budget speech tonight. The Coalition is promising a tax relief package in line with the original stage three principles. What do you mean by that?

JANE HUME: Well, stage three as we knew it, has been trashed. Now, that's a shame because stage three addressed that pernicious, that insidious bracket creep that makes Australians poorer over time, that sucks the aspiration out of our society, that makes you not want to work that extra day or take on that extra promotion or get that pay rise. So we want to make sure that our tax system is slower, is simpler and is fairer so that all Australians can benefit.

MICHAEL ROWLAND: So you promise what the former Government promised in terms of abolishing that 37% tax bracket, a flat rate for people on 45 to 200,000, because that costs, as you know, tens of billions of dollars.

JANE HUME: Well, that was the original stage three and as I said, that’s been trashed.

MICHAEL ROWLAND: Well, that’s what the opposition is saying. Angus Taylor, your colleague, is saying he wants to bring in a promise to Australians, a package in line with the original package.

JANE HUME: That's exactly right. That's exactly right. Lower, simpler, fairer taxes. But the original stage three has gone. It's been trashed. Now we will announce our tax policy. Not according to the media's timetable, not according to Labor's timetable, but according to our timetable. But what I can assure you is it will return lower, simpler and fairer taxes that are in line with the principles of stage three, because that was reform, that was genuine reform and even when that reform was paid for and budgeted, still Labor didn't have an appetite for it. That's a real shame. Australians will pay a price for that.

MICHAEL ROWLAND: Okay, so we've got back to back surpluses tonight and the Treasurer is forecasting bigger than forecast deficits in the out years from next financial year onwards. What do you think of that?

JANE HUME: Well that's exactly right. I think the only way he's going to be able to pay for these surpluses. Quite frankly, they're not structural surpluses. These are windfall gains and that's demonstrated by the fact that he can't return structural surpluses into the future because he hasn't made the hard decisions necessary to do so for the long term prosperity of the country. Quite frankly, when he talks about a lower inflation target by the end of the year, you've got to scratch your head and wonder at what cost, what gives in order for that to happen, why is his target so different to that of the RBA? Is it because interest rates will take longer to come down now, which means that consumption will be lowered? Is it because unemployment is going to go up? These are the things that we're going to be looking for in the Budget tonight.

MICHAEL ROWLAND: The Treasurer says and the Finance Minister, Katy Gallagher, says as well, the bigger than forecast deficits will be the result of unavoidable spending. We're talking of the NDIS aged care, defence and health. What would the Coalition cut?

JANE HUME: Well, this idea of unavoidable spending I think, is more like unavoidable decisions that both the Finance Minister and the Treasurer have tried desperately to avoid and Chris Richardson said it right, Budgets are all about decisions. They're all about decisions. What this Government is doing is essentially baking in long term promises on the back of short term windfalls. That's not good fiscal management.

MICHAEL ROWLAND: So what long term promises other than funding, aged care, NDIS, health and education are you talking about?

JANE HUME: Well, we will see the details of what it is exactly that they're promising tonight.

MICHAEL ROWLAND: How can you criticise the Government for these yet to be announced measures?

JANE HUME: Well there are some measures that they have announced. They've announced, for instance, $1 billion of your taxpayer monies to subsidise an American company on some technology that is not yet available to be commercially viable. Now that's an extraordinary decision to make, considering it's supposed to be part of a future made in Australia. Why we're paying an American company for a future made in Australia, I'm not quite sure, particularly when there's Australian companies out there that could do the same thing. Even the Chief Scientist said that this particular company probably won't get to a commercially viable solution any faster than any of the other companies out there. They're paying another billion dollars for solar panels, which even their own hand-picked Productivity Commissioner has said potentially could subsidise an industry forever and a day that will never be competitive. These are decisions that the Government has made that are costing Australians more.

MICHAEL ROWLAND: Just before we go, speaking of what's commercially viable and what's not commercially viable the former New South Wales Energy Minister Matt Kean, on Q&A last night said of nuclear energy, which the Coalition is heavily promoting, in his view too costly and also a trojan horse for the coal industry to continue burning fossil fuel. What do you say to Matt Kean?

JANE HUME: Well, Matt Kean hasn’t been in the meetings that I’ve been in.

MICHAEL ROWLAND (INTERRUPTS): He looked at nuclear as an option for New South Wales when the Coalition was in Government, not too long ago, and he forms his views on that.

JANE HUME: What I can tell you is that lifting the moratorium on nuclear energy in this country is a no brainer, and any industry expert will tell you that opposition to lifting that moratorium is simply ideological belligerence.

MICHAEL ROWLAND: Even from Matt Kean?

JANE HUME: Even from Matt Kean, he's not in the meetings that I'm in.

MICHAEL ROWLAND: Jane Hume, really appreciate your time this morning. Happy Budget day.

JANE HUME: Thank you very much, Michael.