Interview with Laura Jayes, AM Agenda
4 December 2024
LAURA JAYES: Joining me now is the Finance Minister, Jane Hume who's made some similar points as Michele Bullock over the last couple of months as well. We're likely to have that confirmed in the GDP figures today, aren't we Jane? Yes, the economy is growing, but it is due to a lot of government spending. So is that good or bad?
JANE HUME: Laura, yeah well, it's terrible news for the economy. You know, it's in the last two and a half years of this Labor Government, we've been talking about the cost of living and inflation and inflationary pressures. But this has been a real sleeper issue behind that, this anaemic economic growth that we've seen over the last couple of years and the fact that we are, in fact, already in a per capita recession, it's only been that high migration and now we're hearing that public sector spending that's been keeping the economy alive. Now, that public sector spending at that level, around 27.3% of GDP is about 5% more than the average public sector spending as a percentage of GDP in the decade prior. That's really unsustainable. That's not an economic plan. That's a Ponzi scheme. So we need to see some, you know, dramatic changes to the government's approach to managing the economy. Otherwise we're going to see deficits as far as the eye can see. That anaemic growth will stay, and our standard of living will continue to go backwards. At the same time, we'll see inflation be higher for longer, we'll see inflation stay higher for longer, and we'll see interest rates stay higher for longer. I don't think Australians want more of the same.
LAURA JAYES: So what would you cut? What's the number one thing that you'd cut if you got into government?
JANE HUME: Well it's not a matter of cutting, Laura. It's a matter of making decisions, making, you know, your economic priorities and how you manage your budget. And we've spoken about that before putting those guardrails…
LAURA JAYES (interrupts): Yeah but would you keep the same spending and just spend it better?
JANE HUME: Well, you make sure that you maintain your essential services, but you don't spend money on discretionary items. Let me, let's pull out a $450 million referendum on a voice that nobody wanted. Why don't we talk about the Solar Sunshot investment into solar panels that are never going to be competitive, or half $1 billion into Psi Quantum an American company for apparently a future made in Australia? These are not productive capacity investments that are going to give Australians a better standard of living. We want to see economic growth go back onto the trajectory that is going to deliver prosperity in the future, not this continual propping up of an economy with public sector spending that is, in fact, eroding our standard of living and making us poorer. You know, Australians have really struggled in the last few years. They've seen their real disposable income go backwards by 8.7%. So if your viewers are feeling poorer it's not in their heads. They in fact are poorer.
LAURA JAYES: Yeah they're working harder too Jane, before I let you go, this BCA report that showed that Victoria is not a great place to do business. It points out that there has been, you know, $30 billion or 30% increase, I should say, in business investment in the last little while. We just spoke to the South Australian premier Peter at Malinowski, as he's tearing care out trying to free up more land for housing. But he also critically points out something that both you and the Government have been fighting over, and that is caps on universities. He wants more university students because he doesn't have the student housing problem that is seen in Melbourne and Sydney, but the 10% vacancy there for students, so he can afford more international students, and that would be good for the economy. There should be carve outs shouldn’t there?
JANE HUME: Well, that's why we've been saying for a long time now that if you're going to cut back your migration and cut back your number of international students, which the Coalition will do, it has to be done in negotiation with each individual university, because not all universities, not all states, not all towns, are the same. We want to make sure that we encourage international students. We want the best and the brightest here, but what we don't want is this explosion of international students that in my home state of Victoria, is really pushing up rental prices, particularly in the inner city, and exacerbating not just congestion but housing prices as well. That BCA report was damning, and my heart breaks for my home state of Victoria. If the rest of Australia would like a lesson in what economic mismanagement from a decade long Labor government looks like. Look no further than my own state, which is wrapped up in red tape, which has the highest property prices in the country and the lowest standard of living. It's a disgrace what's happened here. And you know, I genuinely dispair for my own state. But let's not let this happen at a federal level. Let's make sure that we make the right decisions now to get the economy back on track so that we get a better quality of life and a better standard of living in the future.
LAURA JAYES: Jane, thank you. We'll see you soon.