The Hon Andrew Leigh MP
Assistant Minister for Productivity, Competition, Charities and Treasury
E&OE TRANSCRIPT
TV INTERVIEW
NEWS24 POLITICS NOW, WITH TOM CONNELL
WEDNESDAY, 30 SEPTEMBER 2026
SUBJECTS: Labor’s fiscal discipline; Inflation; Scrapping card surcharges
TOM CONNELL: Alright, let's go to my guest, Andrew Leigh, who's been patiently waiting over here. I know you like looking at your numbers. So, what do you make of that? This is a much bigger spending government than the Coalition was. This is an economy that has heat contributed towards it on those figures, isn't it?
ANDREW LEIGH: Well Tom, it's strange that some of our free-market critics aren't able to recognise that four in five dollars of demand is coming from the private sector rather than the public sector. If you look at Michele Bullock's statement yesterday from the Reserve Bank, they begin talking about the inflationary pressures from the war in Iran and then go on to talk about the impact on prices of the AI-driven data centre boom.
So, they're the principal pressures that the Reserve Bank is looking at. Obviously, public demand plays a part which is why we've been so focused on making cost savings, including $38 billion over four years off the NDIS, savings from ending Inland Rail at Parkes – $4 billion there, another $3 billion saving on ensuring the private health insurance rebate is based only on income rather than age, and a whole other series of savings that our government has made.
TOM CONNELL: And they've been totalled up. And this is sort of why I alluded to, you can always mention different figures but that spending as a percentage of GDP – that is a huge increase from pre-COVID. That can't just be explained by saying, ‘Oh, well there's a bit more we're spending on defence’. We're talking $65 or $70 billion dollars per year now. That's a lot more money, isn't it?
ANDREW LEIGH: There's very clear pressures in the budget, including the defence spending pressure, including the NDIS where we've made significant decisions, and also including areas where the Coalition have opposed savings measures that Labor has put forward. So, the private health insurance changes that I mentioned before – opposed by the Coalition. They've announced a whole lot of new spending, but haven't said where that would come from. And of course, they went to the last election promising Australians higher taxes and higher deficits.
TOM CONNELL: The spending we're at now, with the per cent of GDP – with that figure – putting all the other stuff aside, do you think it needs to come down? Or is that figure – nearly 27 per cent of GDP – is that the new normal with our demographics now? And the defence and security and NDIS, all of that – is that just what, in your view, we need to be spending? Is that a reasonable figure?
ANDREW LEIGH: Tom it's always easier to be talking about spending in the abstract rather than the concrete. And so, you'll hear various armchair critics saying that government ought to cut spending. Much more rarely will you hear them actually talk about what areas they would like to make savings. You look at what we've done in consultants and contractors, more than $4 billion in our first term, another couple of billion dollars in the most recent budget. These things add up. They've come through tough decisions around the Cabinet table and Expenditure Review Committee…
TOM CONNELL: So, is what you're saying there that you are doing everything you can as a government on spending and this is the best possible outcome, or do you think that number needs to come down?
ANDREW LEIGH: Well, I begin with the proposition that four-fifths of demand in the economy is private demand and that the Reserve Bank statement focused on the war in Iran and the AI-driven data centre burden as the principal pressures…
TOM CONNELL: They’re the recent numbers, I mean that could be fair enough but they’re only the recent numbers because we've had elevated spending for so long?
ANDREW LEIGH: Well, what we've done as a government is made a bunch of tough decisions around spending reprioritisations. We've made decisions, for example, around defence land. Again, being opposed by the Coalition. So, the Coalition are very happy to go out there and attack the quantum of spending but when it comes to us making specific saves, they're opposing those savings.
TOM CONNELL: Well yeah, we'll see if they come up on that because it is incumbent on them to do that. But that's something we'll have to assess at the next election. But you're saying – the short answer is, that level of spending and it is a big increase, isn't it? It's a big increase from pre-COVID. It's inarguable?
ANDREW LEIGH: We've made a series of decisions which are focused on delivering what Australians want. Yes, we…
TOM CONNELL: So you think Australians have such a demand for services that this figure of 27 is now sort of the reality of what's needed?
ANDREW LEIGH: Look, I think Australians have a demand for Urgent Care Clinics, which we've delivered. I think Australians have a demand for higher bulk billing rates, which we've delivered. I think Australians have a demand for getting more essential drugs onto the PBS, which we've delivered. And I think Australians also expect a government to make a series of tough decisions where we can, such as the NDIS, private contractors and the rest where we've made serious decisions to curtail spending.
TOM CONNELL: Could I ask you about the surcharge that’s – the changes basically being scrapped. So, I want to give you an example rather than talk about the abstract because you just alluded to the abstract. So, a not-for-profit pre-school. If parents pay with a credit card, that costs the school money. They still get charged by their bank. If they pay by bank transfer, it doesn't cost the school money. Why shouldn't they be able to pass on that cost?
ANDREW LEIGH: Well there's two things about this, Tom. First of all, this is about transparency, about ensuring that there is a price that you see which is a price you pay. Australians are pretty sick of looking at one price on the menu and then finding another price being charged when they get to the till. But we're also reducing interchange fees, the amount that can be charged by credit card providers to businesses. For credit cards, that will come down from 0.8 per cent to 0.3 per cent, a very significant reduction. These changes have been estimated to save small businesses something in the order of $900 million a year.
TOM CONNELL: Well, except that if the cost is just passed on, it wouldn't save the small business necessarily?
ANDREW LEIGH: No but that's the point, Tom! This is reducing the interchange fee which is charged by the card providers to the business or the child care centre…
TOM CONNELL: But that example I gave you. Given any not-for-profit. If someone pays with a credit card versus bank transfer, it costs them more. Why shouldn't they just be able to pass on the true cost?
ANDREW LEIGH: Well, what we're ensuring is that you have a transparent price in the economy. When you have a clear…
TOM CONNELL: Yeah, but you can still have the transparent. You can say ‘Pay by card, pay this. Pay by bank transfer, pay this’. That's transparent?
ANDREW LEIGH: Well, we're not getting a lot of transparency where you have these sneaky fees out at the last minute. I think people would like to have consistent pricing. Cash has a cost, credit cards have a cost, debit cards have a cost and this reform ensures that there is much more transparency. As the Assistant Minister for Competition, one of the things we've aimed to do is to try and get a more competitive ecosystem and you do that with clear pricing.
TOM CONNELL: So in that scenario, because this is what, you know, I imagine parents paying by credit card actually get 55 days without having to pay the money and maybe airline points. That's the benefit. If they want that, pay a bit extra. Isn't that fair?
ANDREW LEIGH: What this reform ensures, Tom, is that you have transparent pricing through the economy. You've picked one specific example, but the vast majority of cases are going to be people walking up to the till, discovering that they're paying an additional cost compared to what they saw on the menu or walking up to the checkout counter and discovering that the price is different from what it said on the shelf. That's gone as of tomorrow. And the small businesses will benefit as a result of those interchange fees being brought down very significantly for credit cards but also for debit cards as well.
TOM CONNELL: Andrew Leigh, thanks for your time.
ANDREW LEIGH: Thank you Tom.
ENDS