2CC 1206 AM CANBERRA WITH STEPHEN CENATIEMPO
WEDNESDAY, 10 MAY 2023
SUBJECTS: Structural deficit in the budget, funding for cultural institutions, changes to prescription fees, raising JobSeeker, increasing wages for aged care workers.
STEPHEN CENATIEMPO (HOST): Morning. As we've been discussing all morning, last night Jim Chalmers handed down his - well, he's calling it his second Budget, but let's be honest, it's the first real Budget for this Labor Government. To talk to us about it is the Assistant Minister for Competition, Charities and Treasury, and the Member for Fenner, Andrew Leigh. Andrew, good morning.
ASSISTANT MINISTER FOR COMPETITION, CHARITIES AND TREASURY ANDREW LEIGH: Good morning, Stephen. Great to be with you and your listeners.
CENATIEMPO: The first surplus in 15 years. On the face of it, sounds like a good thing, but it doesn't really address the structural deficit. We go back into deficit next year and for the foreseeable future.
LEIGH: That's right, Stephen. So, there's a significant structural issue to be dealt with, and clearly, in one or two Budgets, we're not able to deal with the problems that have built up over nine years of Coalition misrule. But it is a welcome sign to be back in surplus, or the projected surplus that we've got. And that's largely off the back of better employment figures and better wage figures than we'd been anticipating. More Australians are in work and Australian's wages starting to rise. So, that's a really welcome story for the economy as a whole flowing through to the Budget.
CENATIEMPO: So, it's fair to say that your predecessors didn't leave you in such a bad position after all?
LEIGH: They left us with a trillion dollars of debt.
CENATIEMPO: Well hang on, hang on, hang on, I'm going to stop you there, because it wasn't a trillion dollars. Gross debt, it was $888 billion, 25% of that was contributed by the previous Labor government. So, let's stop this trillion dollar stuff and call it what it actually is.
LEIGH: Debt was projected to go to a trillion dollars when we came to office, Stephen. So, it's a significant fiscal burden left to us by our predecessors, but also the structural deficit. They had no path to surplus and the fact that we are now in this very modest surplus reflects the hard decisions that Jim Chalmers and Katy Gallagher have made. In the Liberals’ last Budget, in March of last year, they spent all of the revenue upgrades. Over our last two Budgets, we've banked 87% of the revenue upgrades. If we hadn't done that, we wouldn't have this surplus last night.
CENATIEMPO: Still a considerable amount of extra spending in this Budget, though, which the Opposition says, well, they call it extra spending and they say it's profligate. The Greens say it's a betrayal of the people because you didn't spend all of that $4.2 billion surplus.
LEIGH: Look, here in the ACT, you've got more than $500 million for our national cultural institutions doing things like fixing up the roof and so the National Gallery doesn't have to put buckets around to catch the rain when it rains. Questacon's got $60 million to do much needed property upgrades. You've got the boost to aged care wages, which will benefit 5000 aged care workers here in the ACT, a heavily feminised industry and a badly underpaid industry.
CENATIEMPO: No doubt about that.
LEIGH: You've got the assistance for people with medicines here in the ACT, more than 100,000 Canberra residents have access to cheaper medicines through the 60-day prescribing changes that we've made.
CENATIEMPO: Can you explain that to us? I think the 60-day prescribing thing is a good thing, but explain to us how that's actually a saving for us, because we still pay the same for the medicine, don't we?
LEIGH: You pay one prescribing fee and you get two months' worth of medicines. And so if you're paying that flat cost, you pay it once every two months rather than once every month.
CENATIEMPO: Right, okay. Which is about, what, about $1.20 each time?
LEIGH: It'll depend on where you're at in terms of which card you've got. But there are significant savings and adds up, particularly for people with chronic conditions. The more medicines you've got, the more beneficial it is to only have to go once every two months.
LEIGH: And of course, there's the time saving, too. Then there's the benefits that flow through from the energy bill relief. More than 50,000 ACT households will benefit from our cost of living measures. Stephen, we've been very targeted because we don't want to put additional pressure on inflation, but we know there's people that are doing it tough. And so that targeted package is not a cash splash, which would be a dangerous thing to do right now. It's focused bill relief for energy dependent households.
CENATIEMPO: Well, let's talk about that for a moment, because the vast middle of Australia gets left behind with this. And let's talk about the increases to welfare, for instance. They're fairly tokenistic, aren't they? I mean, the calls for increases to JobSeeker were far more than what the government has actually delivered, and we're talking about a couple of dollars a day, which is, isn't that going to be inflationary? Because it doesn't really make a real difference to anybody's life. So, it's money that's going to be spent and not necessarily on anything that's going to benefit them.
LEIGH: The Economic Inclusion Advisory Committee went through a range of recommendations, 37 different recommendations, and one of their key recommendations was this increase in JobSeeker. They would have liked a larger increase in JobSeeker, there's no getting around that. But the fact is, there's always going to be more calls on the Budget, Stephen, than we're able to deliver. As a Labor Government, we're focused on looking after those who are needing the most. And we're very aware that in the case of JobSeeker, it's a challenging benefit to live off.
CENATIEMPO: Andrew, I want to talk about the changes to aged care. Nobody would begrudge aged care workers getting the pay rise that they deserve. Where are the extra people going to come from, though, particularly to man the increase in aged care at-home packages?
LEIGH: That is a great question, Stephen, it's been a big priority for us. We're working to get more people into aged care training to make sure that aged care is an ongoing career. One of the reasons people have been uncomfortable about going into aged care or have sometimes left it, is because it's such been an underpaid industry and it hasn't had the respect it deserves. By raising the pay and respect of that sector, I think we're going to be able to encourage people to take on and sustain long term aged care careers.
CENATIEMPO: Unemployment is incredibly low and that's largely what this surplus comes off the back of. It is scheduled to rise over the next four years. Is there a concern here that it could get out of control?
LEIGH: The concern with the Reserve Bank and what it's doing is to engineer what economists call a soft landing. That's a concern for central bankers around the world. But the advice we've got is that inflation has passed its peak and it's now moderating. It's really essential that fiscal and monetary policy are working together to ensure that we maintain the low inflation, low unemployment that we've had. One economic measure is called the misery index and it's just what you get when you add up the inflation rate and the unemployment rate. We want that misery index to be low, as low as possible. We know as a Labor government the benefits that come from full employment. People getting jobs who wouldn't have had a look in if you'd had that kind of 10% unemployment that Australia had when I left high school.
CENATIEMPO: Andrew, good to talk to you this morning. Appreciate your time.
LEIGH: Great to chat to you. Take care.