STEPHEN CENATIEMPO: Senator Jane Hume is The Shadow Minister for Finance and Chair of the Select Committee on the cost of living and she joins us now, Senator Good morning.
JANE HUME: Good morning, good to be with you Stephen.
STEPHEN CENATIEMPO: The Budget last night was back in surplus for the first time in 15 years. That's got to be a positive?
JANE HUME: You think so wouldn't you but unfortunately, it really is on the back, as you said of much higher taxes, bracket creep, that's been caused by that persistent high inflation has pushed people into higher tax brackets and the Government's reaping the benefits. But rather than banking all of that windfall revenue, instead, they've chosen to spend an additional $185 billion just this year alone. This is very much a traditional Labor big spending, big taxing Budget.
STEPHEN CENATIEMPO: A fair bit of that spending was necessary, though. I mean, we know that the rate of Jobkeeper had to be addressed, although there are those that were calling for it to be increased, concerned that it hasn't been increased by enough and the increase in funding to Medicare has got to be a positive?
JANE HUME: Well, we certainly want to make sure that disadvantaged Australians are looked after. Anthony Albanese promised when he came to Government that no one would be left behind and in fact, this Budget leaves the majority of Australians behind because let's face it, if you're over 16, if you don't have a child, if you're not on welfare, well, the only thing that this Budget delivers is higher inflation and inflation is the thief in the night, it erodes your purchasing power. It eats at your savings. It lowers your standard of living. It means that you spend more and you buy less and the only way for a Government to slay the inflation dragon is to get spending under control.
STEPHEN CENATIEMPO: Having said that, though, I mean, the myth that the Government was riddled with a billion, sorry a trillion dollars of Liberal debt has been thoroughly debunked, but the reality is gross debt was 888 billion when they came to power. I mean, a lot of that spending was due to your Government during the pandemic.
JANE HUME: Well, actually, you know, the Budget was brought back into balance at the end of 2019. At that MYEFO, something that we were very proud of and it was done through not lowering not raising taxes, but lowering taxes and maintaining spending control and that was done during a low inflation environment when we didn't get those windfall tax gains. More importantly, because the Budget was under control. We actually had the firepower to continue to manage COVID and come out of COVID at the other end with a really strong economy, low unemployment, and of having taken that $115 billion off the debt with one of the biggest Budget turnarounds that this country's have ever seen. And in fact, that trajectory has really been squandered here because this is a lost opportunity. We could have done so much more. But instead, this Budget is actually making life harder for Australians and it's explicitly removed the priority or reducing inflation making that entirely the responsibility of the Reserve Bank to get inflation under control.
STEPHEN CENATIEMPO: But the projections are that the inflation will get itself under control in the next financial year and moving forward?
JANE HUME: I'm looking through his Budget trying to find a single policy that will lead to that objective. Gas and electricity prices will continue to skyrocket. Yes, there's relief there. But it's limited and it's temporary and there is no plan to increase energy supply. Real wages haven't grown and they're not forecast to grow throughout the whole term of this Government. Inflation still remains high. There's a seven in front of it in the last three quarters of this year and there's new taxes now on farmers and on trucking and that means that food prices are likely to experience further pressure and on top of that, unemployment is forecast to rise and we are actually planning on 1.5 million new migrants over the next five years that includes this year, at the same time as Labor or delaying or cutting infrastructure that would support that higher population.
STEPHEN CENATIEMPO: Yeah, that is the extraordinary part about it. We just don't seem to have thought that through very well. I know that the Treasurer has claimed that he's going to build a million houses in five years. Nobody knows where the materials the skills, or or indeed the land are going to come from to do that. That seems to have been the well, you'd say that they're the three key issues when it comes to building a house but they haven't been addressed?
JANE HUME: I'm very concerned that if you're in Government at a Federal level and in every State and Territory bar one in Tasmania, why would you not use your leadership to make sure that those premiers are opening up supply of new land that I think is a real indication of the leadership and the respect in which Anthony Albanese is held by his premier colleagues.
STEPHEN CENATIEMPO: While we're on this, here in the ACT there's a deliberate reluctance to release land from the Labor Greens Government. Now I do want to touch on one thing, the big loser out of this Budget seems to be Defence, not at all but not a cent extra for defence, a lot of shuffling of the deck chairs, but we still remain at that low level of defence spending, which most experts are saying is about one and a half percent of GDP less than what we need to spend.
JANE HUME: Not only that we've actually seen a reduction in the number of serving military personnel in the last 12 months by about 2000. I think that's some cause for concern. You're right. We do need to see an increase in spending on our national security that's so fundamentally important. The first responsibility of any Government is to keep its citizens safe. The Defence Strategic Review has made some recommendations and they are played out in the Budget. However, you know, what concerns me is that the Government was calling these things savings, they spotted savings, they said $17.8 billion of new savings, and then you scratch the surface, you realize that the first 7.8 billion of those is simply changing one submarine contract to another submarine contract. That's not a saving. That's simply an offset. That's just a reprioritisation. So during the Estimates process, we're going to be forensically examining exactly what this Government is calling a saving, and essentially just it's rebadging, relabeling or, or as you say, moving the deckchairs.
STEPHEN CENATIEMPO: So, tomorrow, Peter Dutton hands down his Budget in reply speech. Is this a real opportunity, for a kind of a make or break speech for Peter Dutton to cement his leadership. There's a need here for the Coalition to really set a policy agenda.
JANE HUME: Well, I think you'll have to wait to see exactly what's in that Budget in reply speech tomorrow night. I don't want to preempt what Peter is going to say. But I think that you know it most importantly the Budget in reply should reflect the Budget that was delivered and one of the things that we're disappointed about is that essentially, this Budget doesn't deliver for people that have mortgages, people that are in work, those middle Australians that are really doing it tough right now. My Cost of Living Committee has heard from charities, particularly food charities that have said the new people that are walking through their door and asking for assistance are often dual income families, they're people with mortgages and if the Government could do one thing that would help alleviate the pressure on some of those food charities, it would be to lower interest rates, so that those new customers weren't feeling the pressure to seek help from charities.
STEPHEN CENATIEMPO: Indeed, Senator, I appreciate your time this morning.