ABC NEWS BREAKFAST
THURSDAY, 23 JULY 2020
SUBJECT: Budget Update.
LISA MILLAR, HOST: The Coronavirus outbreak has taken a toll on Australians and the nation's finances for many years ahead. Today the Government is expected to reveal just how bad things are days after outlining changes to the JobKeeper and JobSeeker programs. Shadow Treasurer, Jim Chalmers, joins us from Parliament House in Canberra. Good morning. Welcome to Breakfast.
JIM CHALMERS, SHADOW TREASURER: Good morning. Thanks for having me.
MILLAR: We have already been told the figures are going to be eye-watering with a $90 billion deficit. Where do we go from here?
CHALMERS: That’s the most important question. We'll hear today how deep the downturn is. We will hear about how high the Government expects unemployment to get to. We will hear about how much debt has been piled up, not just during this crisis but before it as well. But it needs to be more than an assessment of how grim things are. There needs to be a genuine plan for new jobs into the future. A lot of Australians are understandably very anxious. There’s a lot of uncertainty. People are very worried. What they need to hear from the Government today is not just how grim it is but what they're going to do about it.
MILLAR: It is tricky when you have got a situation like Victoria which proves that no amount of planning can get you past unexpected surges and events that we are seeing here, 484 cases yesterday?
CHALMERS: Yes the numbers which were released in Victoria yesterday were incredibly confronting. Our thoughts are with Victorians and those affected, obviously, in NSW as well and elsewhere around the country. I think the important point to recognise here about the budget update and the Victorian outbreak is that most of the debt which the Government will be announcing today was accumulated well before the Coronavirus, something like two-thirds of the debt in the budget was borrowed by the Government before this outbreak of COVID-19. What we need to keep an eye out for is the Government trying to pull a swifty and pretending all the red ink in the budget is a consequence of the virus when the truth is the vast majority of the debt had piled up beforehand. What we need to see today is the admission the debt had doubled even beforehand, but more importantly a plan for jobs and recovery into the future when all of this otherwise welcome support runs out.
MILLAR: The economy had been knocked around with drought and bushfires. No one is denying it. The Government was hoping for and predicting a $5 billion surplus in the end and it is now going to be a massive deficit that is going to take decades for people to pay back. Lots of talk about industrial relations and workplace flexibility. How supportive and open is Labor going to be to that?
CHALMERS: So far it has just been slogans and marketing exercises. There’s not a detailed proposal on the table. There's nothing that resembles a plan for jobs and recovery into the future and that's what we need to see today. Your points about the bushfires over the summer and the damage done to the economy by COVID-19 are important. But it is equally important to recognise and remember that the Government wasn't just hoping for a surplus this year. They printed mugs that said that they had achieved a surplus this year. When they announce these deficits today they won't be the first and the second, they will be the seventh and eighth consecutive deficits. We need a bit of perspective here. The Government needs to acknowledge they weren't doing a good job leading up to this crisis. There has been some necessary spending to respond to the virus and we've been supportive, responsible and constructive about that. It is time for the Government to acknowledge that the last few months of spending doesn't explain the last seven years of failures in the budget.
MILLAR: But what would you be doing if you were in Government? We are looking at an unofficial rate, a real rate as it were, of 11 per cent unemployment. You talk about creating jobs. How do you create jobs in an environment like this?
CHALMERS: That is absolutely the key test. The Government, the Opposition, any decision-maker in the economy, should be judged on what happens to unemployment and what happens to underemployment too - we had an issue there before the crisis. We've been constructive and put proposals on the table. We think, for example, it makes a lot of sense to build more public housing because it is labour intensive and has a lasting benefit for the most vulnerable Australians. We put that proposal on the table. We said in the longer term, obviously, one of the reasons the economy wasn't growing very strongly before the crisis is because there wasn't a settled energy policy. We said to the Government, let's come together and agree on a settled energy policy so that businesses can invest with confidence. They have had their hands in their pockets because there hasn’t been energy policy certainty. We have made a range of suggestions. What we need to hear from the Government, the decision-makers here, is a comprehensive plan for jobs in the budget update, not just another press release to tell Australians what they already know which is that the economy is in bad nick.
MILLAR: Jim Chalmers, we are going to leave it there. Thank you for your time.
CHALMERS: Thank you, Lisa.