Doorstop, Parliament House
8 May 2023
JANE HUME: Australians are making difficult decisions about their own budget and that's why they should expect that Jim Chalmers has done the same with his budget. Labor needs to make some very tough decisions right now. It's not just about reducing the cost of living. It's not just about those band aid measures, because that's what they will be unless you can tackle the cause of the cost of living rises and that's inflation. Unless this is a Budget, that doesn't just say it won't be inflation, that actually says it will reduce inflation, unless this is a Budget that can point to policies that will actively reduce inflation. Well, all Australians will pay the price, because that's the only way that you can reduce the cost of living for all Australians.
JOURNALIST: Senator, today, the Federal Government has announced that all of its cost of living measures will cost about $15 billion over four years. Are you confident that they won't be inflationary? The Government says they won't be.
JANE HUME: It's not enough that those policies won't be inflationary and we'll wait to see what's in the Budget papers and we'll ask those questions that estimates, certainly make sure that they can point to the modelling that shows that those policies won't be inflationary. But the fact is, unless they reduce inflation, or any cost of living measure, any handouts, any increase to welfare, it will simply go up, it will be eroded by high inflation and that's what we've seen from this Government. Inflation with a seven in front of it for three quarters in a row now, and that's after the Government promised when they came to Government, that they would reduce the cost of living and that we would see real wages increase. In fact, we've seen the exact opposite and unless you get inflation under control that will continue.
JOURNALIST: The classic way to slow down the economy outside the RBA’s powers is to cut government spending. If you were in power, what would you be cutting?
JANE HUME: Well, the first thing we would do would not say for instance, increase the number of public servants. We've already seen the number of public servants increase by 8000 in the last 12 months alone, that's increasing Government expenditure. More importantly, we wouldn't call offsets savings. I think we can ask this Government, not where it's making offsets, and just reprioritising its expenditure, but where there are actual savings measures that have been banished to the budget bottom line. Instead, what we're hearing is that there's this windfall revenue coming from high commodity prices coming from income tax, from bracket creep, and that's now being spent more than 40% of it is in fact, going to further expenditure, rather than being put back into sustainable surpluses, sustainable expenditure control, reining in those innate Labor urges to spend more and tax more, because you cannot tax your way out of prosperity. The only way we're going to sustainably see an improvement of people's cost of living is if you rein in inflation and Labor seems to have raised the white flag on this and turned the responsibility over to the RBA.
JOURNALIST: So on that issue, you're questioning the $17.8 billion in extra savings that they say they found. So they found 20 billion they said in October. Now they're saying they found another $17.8 billion, you're questioning that $17.8 billion figure as to where that money is coming from?
JANE HUME: Well, they've already admitted that the first 7.8, of 17.8 billion is simply a re-prioritisation of defense spending, something that was going to go to one thing, and is now going to another. So, what's happening with the extra $10 billion, is that the same because let's face it, if you're just re-prioritising, existing expenditure to call that a saving is disingenuous. That's not a saving. That's an offset. That's a basic budget discipline. If you're looking for savings, genuine savings, you can go to the budget bottom line that will improve the budget in the long term, and we haven't seen that from his Government. Instead, we've seen that natural that big tax, big spend traditional Labor Budget that we were all expecting and that's not going to help anybody because the only way you can help Australians with their cost of living crisis is to get inflation down, not just deliver a Budget that isn't going to make the situation worse, and not bring inflation down at the moment, the RBA has to do all the heavy lifting, because Jim Chalmers won’t.
JOURNALIST: How about the energy rebate? Katy Gallagher confirmed that it will be up to $500 and it could be different from State to State given that there's different electricity markets that work differently in every jurisdiction. Is that something that you'd support?
JANE HUME: Well, the reason why an energy supplement is needed is because energy prices have skyrocketed and we saw that those energy prices were predicted to skyrocket just in the October budget alone. Now there's two issues here. One is that Katy Gallagher is suggesting that the measures that were undertaken in December last year are going to be the centrepiece of this Government's energy supplements. Well, I think that's rather disingenuous, the Budget is supposed to be what happens in the future, not what's already been done. But more importantly, the only way that you can sustainably bring down energy prices, is through improvements in supply, increasing the number of big investments into energy, into the grid. That will sustainably bring down energy, if not, all you're doing is throwing out a band aid, that potentially may not be inflationary now, but once you lift that subsidy away, well, that will be inflationary again.
JOURNALIST: Well just on that issue, then how about the $2 billion that the Government is saying that they'll raise from gas and oil companies? Do you think that that could encourage gas companies, maybe not to explore?
JANE HUME: The PRRT changes were initiated under a Coalition Government through the Callahan review, and that's something that we'll look at very carefully in this Budget. But let's face it, the oil and gas companies have been hit with a price cap, they have been hit with the safeguard mechanism, and now they've been hit with a new tax, you cannot tax your way into prosperity. It simply is impossible. I think it was Winston Churchill that said, taxing your way out of a budget crisis is like lifting yourself up by the hand while standing in a bucket with a hammer. Something as articulate as that I'm sure but the most important issue here is that if you keep taxing these companies, if you keep messing with their market mechanisms, if you put on a price cap, how can you possibly get new investment into the energy grid? How can you possibly ask new companies to come in and make that high risk investment? If the Government keeps going, keep going to interfere and keep taxing more, and that's just going to push energy prices up for all Australians. Any subsidy that they make right now is only going to scratch the surface of energy prices that keep going up.
JOURNALIST: How about Jobseeker? Would you support, would the Coalition be supporting an across the board increase for Jobseeker, not just for those over 55?
JANE HUME: Well, again, we want to make sure that most vulnerable Australians are taken care of, that is a responsibility of the Government. Jobseeker is already indexed. And of course, while inflation is high, while inflation has a seven in front of it every quarter for the last three quarters under this Government, well, Jobseeker is going to have to ratchet up. I think we'll see an extraordinarily huge amount of money, dedicated and a budget for Jobseeker, just through the indexation alone. The most important thing here though, is Jobseeker, any increase is going to be gobbled up, is going to be eroded, as long as inflation stays high and that's why this Government's number one priority should be reducing inflation. It shouldn't be a standalone policy objective. This government needs to reduce inflation in order to tackle the cost of living.
JOURNALIST: That sounds as though the Coalition would not support an across the board increase in Jobseeker, you just would accept the indexation?
JANE HUME: Well, we'll look at the details in the Budget. Obviously, with it's only been rumoured now, we haven't seen what the details are. But the most important thing that this Government can do is tackle what's important, rather than just sticking a band aid over the top, because quite frankly, if they don't tackle inflation, any efforts and cost of living relief will simply be eroded away, simply eaten away.
JOURNALIST: Your colleague Angus Taylor has said that ‘a drovers dog could deliver a surplus’
JANE HUME: Yeah I heard that, he stole my line.
JOURNALIST: In which case, why was your government not able to do that?
JANE HUME: Well, in fact, we delivered a balanced budget at the end of 2019, then of course, COVID hit. We had that balanced budget that actually gave us the firepower to be able to deal with a crisis that had been an unprecedented health and an economic crisis combined and we came out of that crisis, with an incredibly strong position, low unemployment and a growing economy, a growing economy faster than most of the G7 nations. That's something that we should be really proud of. More importantly, in the last year of the Coalition Government, we reduced that debt by $115 billion and that's because the economy was growing strongly and let's face it, Labor has inherited that. That's that strong economy and that improving fiscal position that proves the Budget position, they've now capitalised on that, with inflation causing bracket creep, that's causing income tax revenues to rise and those soaring commodity prices. Surely, we know that this is a windfall profit, why would you be spending it? Why would you be spending it rather than banking it? This is an opportunity for this Government to make some real, significant improvement to the Budget bottom line in a sustainable way, not simply spending it in one Budget on band aid measures. Thanks, guys.