Interview with Michael Rowland, ABC News Breakfast

18 November 2024

MICHAEL ROWLAND: Let’s bring in now the Shadow Finance Minister Jane Hume, at appropriately, Parliament House. Jane Hume, good morning to you.

JANE HUME: Good morning Michael.

MICHAEL ROWLAND: Listen lots to talk about. I want to get your response first to what the Treasurer was announcing on our show. That was a move to ensure people who sell essential services like groceries and fuel will have to accept cash. Do you support that?

JANE HUME: Michael, this seems to be a government thrashing about for an economic narrative. After two and a half years, what they've come up with is a plan for a plan. It isn't going to come into effect until 2026. Not dissimilar to the surcharge announcement of a couple of weeks ago. This does seem to be a consultation about a consultation before we make a decision. Where is the decision on this, for this government to reduce the cost of living for all Australians? Because that's the number one issue that Australians are facing right now. We'll wait and see what this consultation is about because quite frankly, if it pushes up the costs of small businesses or even large businesses, if it pushes up the costs for consumers, well, that will have implications.

MICHAEL ROWLAND: Okay. So you're not supporting this in principle?

JANE HUME: All we've seen is a media release. We haven't seen anything else.

MICHAEL ROWLAND: But, well the principle is that people who want to pay cash to buy essential services like groceries and petrol should be able to, under the law, use cash. Do you support that principle?

JANE HUME: Cash is a store of value, but it's also a means of currency. Of course, people should be able to use cash, but inflicting more regulation, more red tape on businesses large and small does have implications for the cost of goods and services, and Australians are already paying too high a price for decisions that this government is making. We'll wait and see what it is that they actually want to investigate because at the moment it's just a consultation. It's just another plan for a plan. It's not action.

MICHAEL ROWLAND: Okay, the Treasurer also confirmed on our show The Treasury is looking at imposing a levy on banks to ensure they keep country branches open. What do you think of that?

JANE HUME: Well, we know that regional and rural banking services have been diminishing over the last decade or so. Again, if this was such a priority of the government, why is it that they've waited until the last two weeks of sitting for this year, potentially the last two weeks of sitting for this Parliament, to take action? And we've seen this throughout this term of government, that the government has taken its eye off the ball as to what's important. The cost of living has soared out of control under this government. Living standards have fallen by 8.7%. Why is it that the Government is making announcements now about issues at the edges, rather than dealing with the root cause of the problem, which is public sector spending.

MICHAEL ROWLAND: Well, I guess it's another in-principle thing. Do you believe that banks should be compelled to keep country branches open with a possible levy imposed on them?

JANE HUME: Well, we want to see that people in regional and rural areas are serviced appropriately and can be banked appropriately. Whether the appropriate way to go about that is by imposing more costs on banks that will be passed on to consumers. That remains to be seen.

MICHAEL ROWLAND: Okay. Late last week, a Coalition dominated Parliamentary Inquiry, chaired by you, found that indeed the cost of living was a clear and present issue for so many Australians. I mean, everybody knows it's an issue. How is the inquiry talking about fixing it?

JANE HUME: Well, the inquiry has returned three reports. Now, this is the third and final report with nine recommendations. The previous report had 14. The key finding of this report however, was that independent economists, the IMF and the Reserve Bank have all pointed to public sector spending as one of the great drivers of inflation. Inflation has kept the cost of living higher for longer and caused our living standards to collapse by 8.7% in the last two years. We're calling on the government to hold a National Cabinet into public sector spending at all levels of government, because it is a national crisis and it deserves a national response. There is already a mechanism there to do that. A National Cabinet looks at things like, it's already looked at things like domestic and family violence. It's looked at age verification and social media bans for teenagers. Why would it not look like look at the most important issue that's faced Australians right now, which is the cost of living crisis and their collapsing living standards and how to address that public sector spending that's keeping inflation higher for longer and keeping interest rates higher for longer and all Australians are paying the price.

MICHAEL ROWLAND: The Treasurer says government spending is pretty much the only thing that's kept the economy afloat, given weak private sector activity.

JANE HUME: Well, that's not what the economic, that's not what independent economists are saying. They're actually saying it's making the problem worse. The Reserve Bank has said that public sector spending has made the problem worse. It is one of the key drivers for inflation…

MICHAEL ROWLAND (INTERRUPTS): On that front, Michele Bullock, the Governor of the Reserve Bank says public spending is not the main game, her words, for the RBA in determining interest rates.

JANE HUME: And in fact, the RBA's economists said that they would need to see inflation cool by seeing public sector spending cool before they could lower interest rates further. They're already saying now that they're not expecting inflation to come back sustainably to band until 2026. That's way too long. That puts Australia up there with Slovenia and Slovakia for countries that have failed to get inflation under control, and that's being driven by that public sector spending, which is now at around 27.5% of GDP. That's much higher than the 22.5% it was in the ten years prior to Covid and in my home state of Victoria, Michael, public sector spending has increased by 7.7% in the last 12 months alone. That is entirely unsustainable and Australians are all paying the price for that higher inflation that's lasting too long.

MICHAEL ROWLAND: Okay, finally, the election is fast approaching. If the Coalition wins, there'll be a lot, a lot of extra public spending if it comes to implementing your nuclear power plan. When are we going to see the costings on that, Senator Jane Hume?

JANE HUME: Well, the Coalition have said, that before the election, the costings for our nuclear policy will be available. But what we saw last week was an independent economic report by Frontier Economics that showed that Labor's energy policy is actually going to cost so much more.

MICHAEL ROWLAND: Yes, so let’s just keep it to nuclear policy, championed by the Coalition.

JANE HUME: And you will see those costings. You will see those costings.

MICHAEL ROWLAND: By Christmas?

JANE HUME: Well we've said by Christmas you'll see those costings…

MICHAEL ROWLAND (INTERRUPTS): Christmas is only five weeks away.

JANE HUME: But the most important thing here, Michael, is that when we do release costings, that we compare apples with apples. We need to make sure it's a whole of system costing of the Coalition's policy versus Labor's policy and what we've seen is that Labor's policy, that all eggs in one basket approach, that renewables only approach, is actually going to cost around $500 billion more than they have said, and that is an unreasonable amount of money. We will make sure that when we release our costings, that you will get a clear picture of what one policy is versus another policy is. That energy mix that will keep prices lower as well as cost Australians less.

MICHAEL ROWLAND: Okay, I look forward to seeing them when they come out sometime in the next five weeks. Jane Hume, thank you.

JANE HUME: Thanks Michael.