Interview with Greg Jennett, ABC News, Afternoon Briefing
7th September 2022
GREG JENNETT: Let's pick through some of the day's economic news and what's going on in the Senate. Shadow Finance Minister Jane Hume joins us now, right here in the studio. Welcome back Senator, cost of living is the Coalition seriously expecting people to wait fully through the term of this parliament before it starts lobbying suggestions are specific suggestions into the economic debate of this country about how to resolve it?
JANE HUME: Well, Greg, in the lead-up to the last election, in May, Anthony Albanese, then the Opposition leader, talked a very big game about his government having the best answers to solve the cost of living crisis. Now, Australia voted for Anthony Albanese in the Labor Government and yet since they’ve come to government, they really have been devoid of any ideas, they keep talking about an economic plan that doesn't seem to have eventuated. They have crab walked away from their signature policy to reduce the cost of living, which was a $275 reduction in energy prices. Minister Bowen has come out and said that he stands by that modelling, but that's weasel words if he can't actually commit to the promise to reduce energy prices by $275.
JENNETT: I'm sure they will counter that with arguments that you'll be familiar with by now that they're tackling pharmaceutical benefits scheme out-of-pocket expenses, moving on childcare next year, and they have had a Jobs and Skills Summit, but for your part, in parliament, national economic debate is stimulated by ideas as well as asking the Government to come up with some. At one point during this electoral cycle, could we hear specific suggestions from you or Angus Taylor?
HUME: When we were in government, obviously, we dealt with the issues and challenges of the day. When the cost of living was an issue for the Coalition Government, that was when we introduced the fuel excise reductions. It was also when we introduced payments to pensioners to help those on fixed incomes deal with the cost of living. But we’re not in government now. Anthony Albanese is Prime Minister, and Labor is in government, and it's up to them to come up with the solutions. They certainly talked a big game in the lead-up to the election. I know that they’ve decided to cut the cost of medicine, and we support that. Not only do we support it, but it was our policy before the last election. It doesn't kick in until March next year. We know that they have decided to cut the cost of childcare, that’s terrific. We want to make sure that childcare is more affordable and accessible for Australians however, that doesn't kick in until June next year. What are they doing to help the cost of living today? We know that Australians are struggling at the bowser, at the grocery checkout and certainly paying off their mortgages.
JENNETT: And what does today's national account tell you about the cost of living pressures because at one level of analysis, and I'm sure this will be true for a certain number of households, particularly at the upper end, it's happy days.
HUME: There's good news and bad news in those National Accounts. Certainly, it shows that the economy was in good shape at the end of June. Certainly, when we left government when the unemployment was low, it had a three in front of it and was on its way down. We had a triple-A credit rating that we maintained throughout the COVID-induced economic crisis and pandemic as well. We had some of the best health and economic outcomes that the world had seen, and yet now, we have a new crisis, and that is a cost-of-living crisis, and that's what Anthony Albanese and the Labor government need to deal with today. The most important thing, though, is that we have a monetary policy and fiscal policy working in line, working together just as we did during the pandemic. At that stage, we needed to put our foot on the gas on fiscal stimulus and also reduce interest rates, but now, we need to move the other way. If we don't see the fiscal policy match monetary policy, well, then we are going to see Governor Lowe have to pull the lever much harder on interest rates.
JENNETT: He's going to do that anyway, isn't he? On the strength of these figures today but other data that inform his decision.
HUME: He certainly will if he doesn't see an indication from the Government that they are going to move into a position where the fiscal policy is working together with monetary policy, rather than in competition with it.
JENNETT: There’s much more I could ask you about the state of the economy, but I want to take you to something more specific in the Senate right now, and this is the debate over the Treasury Bill, the Government bill that would remove fringe benefits tax and lower the price of electric vehicles, what have you got against electric vehicles that you will oppose this bill?
HUME: Absolutely nothing, in fact, we've seen electric vehicles being the fastest take-up of market share of new car sales than ever before, and that's really good news. But this Bill, the Bill that's about to face the Senate, is actually just bad policy. We know that Treasury did no consultation on the effects of this bill, Labor said that it will cost around $200 million, but in fact, the PBO said it's around $350 million and $4.5 billion over the medium term. There are no estimates as to how many EVs this will increase by, no estimates as to how much emissions it would reduce by. The real issue with this at the moment is a matter of supply and infrastructure. Our suggestion would be that Labor refocuses its attention on electric vehicles, not on getting rid of the FBT, which we don't know whether will make a difference, but rather focus on infrastructure for EVs. Make sure that the charging stations are there right around the country so that there is a natural market take-up of electric vehicles.
JENNETT: I'm sure they would say that they have other forms of marketing interventions in the pipeline for EVs, one being this fuel efficiency standard that will apply to the national fleet of new sales, do you welcome that if you can't support this one, do you welcome that part?
HUME: We welcome the market taking up electric vehicles, which it’s already doing, which is terrific news, but it should be market driven. The issue at the moment is the supply of EVs and infrastructure for EVs, it’s not whether there is an FBT or carbon fuels, its supply and its infrastructure. That's what this government should be dealing with.
JENNETT: Somehow, I think we will be talking about that and some of these other persistent economic themes before too long. Jane Hume, thank you for joining us.
HUME: Great to be with you, Greg.