Senator the Hon. Simon Birmingham
Minister for Finance
Leader of the Government in the Senate
Senator for South Australia
Date: Wednesday, 12 May 2021
Robbie: This morning by senator for South Australia, good morning to you, Minister.
Simon Birmingham: Good morning, Robbie, Wendy and listeners.
Robbie: All right. We know that this is being billed as a big spending budget, of course, it was only a few years ago that the rhetoric from the Coalition was get the budget back into black. We don't want big budget, we don't want big deficits. This is the biggest deficit on record.
Simon Birmingham: Well, this is the budget, actually, where net debt is forecast to come down across each of the 10 years in the budget projections compared with what was handed down last year. So we've managed to hand down a plan that because of our economic strength, because of the jobs growth we've got across Australia, enables us to do as we promised in investing in essential services, in fully funding the NDIS as we promised, in investing in the response to aged care. But being able to do that while bringing the nation's net debt down compared with what had been forecast in last year's budget.
Robbie: Sure, but we are still seeing a record debt in that area, which of course, in years previously was something that you had accused the Opposition of being spendthrift around. I guess this is a very big change of rhetoric. That's my point.
Simon Birmingham: Well, a global pandemic changes the circumstances in a great way and it absolutely has hit Australia's economy and economic forecasts for six. Even in this budget, we are still committing a further 40 billion dollars, or thereabouts, in COVID responses in how we actually manage our way through the pandemic, both on a health and an economic front, and so those temporary expense measures do come at a cost and do less of an ongoing expense in terms of in terms of the debt that is accumulated. But they're essential to keep Australian jobs secure. And, you know, we're a country that has got employment levels back above where they were pre pandemic. And we're the only country in the developed world to have achieved that outcome already. And we've actually managed to get Australia into an incredibly strong position. But we know when we see Europe going into a double dip recession now that we can't take anything for granted in terms of that economic recovery. And it's why the plan is comprehensive in focussing across how we grow our digital economy, how we grow our agricultural sector, how we grow our manufacturing sector and sovereign capability in Australia. And these are all key parts, along with further tax incentives and breaks for investment and for households that are essential for our continued growth.
Wendy: If, I know how long the budget takes to prepare it, it's a really huge job. If you were to look at this budget and you say, look, there's one thing here that I'm really pleased with, what would it be, Minister? One little gem there that you think, well, this is something really special for this year,
Simon Birmingham: The mental health package. I think the mental health package stands out very much as something that over time will be transformative. You know when the Howard Government began the process of supporting and establishing the Headspace youth mental health centres that have become such an important part of helping young Australians across the country. And we're establishing another five satellite headspace centres. But in this budget, the transformative part, in terms of mental health support, is to create an adult facility with a head to health adult mental health centres, which we will have some 40 altogether of centres and satellite centres established across the country, recognising that many Australians face mental health challenges and that we need to make support for them more available, and this budget does so.
Wendy: Was that a personal crusade for you, or where did that impetus come from?
Simon Birmingham: I've got the full credit to, I mean, the Prime Minister who put suicide prevention as a priority on his agenda in his first year as Prime Minister. If people look back, they'll see he spoke passionately there and has tasked work in that area. But then he appointed Sydney MP David Coleman to a particular role reporting to the Prime Minister to drive those policy initiatives. And David Coleman deserves enormous credit for these measures.
Robbie: The aim for this budget is to try and get the unemployment rate down below five per cent and to have another 250,000 Australians in jobs. You're asking for 100,000 extra apprentices to be taken up over the coming few years as well. Can you give us an idea of how that training is going to take place? How much of that is going to be private training colleges and how much is going to be in TAFE for example?
Simon Birmingham: That's really a matter in part for the states, and in part for businesses and individuals as to where they choose to go in the training market. So, you know, we are supporting essentially through two streams, the training sector, as you said, 100,000 additional apprentices. We're driving that through effectively an apprenticeship subsidy to get employers to employ those apprentices. So, where they're trained will then depend very much on the relationship those employers have with different training institutions or, of course, the sector that they're in and where the best training is available. So some of it may be not for profit industry training. I know sectors like the motor trades, for example, run their own group training programmes often that are important or specialist industry training. But some of it no doubt will find its way into pay for other training providers.
Wendy: Well, I guess that's the question, isn't it, really? That is the sort of training going to be portable or is it going to be tied to a particular business if it comes through some of these private colleges? We do have a lot of people listening to us who probably want to upskill or, you know, put young people through TAFE. They want to make sure that what they're being taught is state of the art obviously and it's also portable and not just, as I say, being funnelled into one particular company or another.
Simon Birmingham: Absolutely, Wendy and that's why in the apprenticeship side it's about creating a job. You know, the apprenticeship is a job that comes with training. So in that sense, we're providing the incentive for the employer to create the job and to take on the young Australian usually into that role. But then a broader skills package being negotiated with the states and territories is about, again, creating places for individuals, not funding institutions. Institutions have to deliver the training, high quality TAFEs, high quality not for profit and private providers. They all play an important part in that mix. But again, in that training budget, we've identified some priorities. More than 33,000 places identified for aged care training, recognising that if we're to achieve our ambitions in terms of improving the quality of aged care, there's a workforce requirement that goes with that. We've equally recognised in our digital economy strategy particular areas where we want to encourage more women to pursue some of those digital skills and capabilities in areas of STEM and so forth with new scholarship programmes. Again, very important measures to equip people with the skills of future jobs.
Robbie: Minister if there's a focus on vocational training. Fair enough. Sure. That's where a lot of jobs are going to go. But why then a cut to higher education in the university sector of like 8.3 per cent?
Simon Birmingham: Well, there's not. So universities continue to receive guaranteed funding of 19 billion dollars across Australian universities, there's around 30,000 additional enrolments.
Robbie: Are you saying there's not an effective funding cut of 8.3 per cent for universities?
Simon Birmingham: I am saying that for sure that in this budget we're guaranteeing that continued funding in the budget bottom line for universities. In last year's budget, we provided a top up for 2021 at one billion dollars to support research activities in Australian universities during this COVID crisis as well. So that money is still being rolled out as promised in the budget only handed down in October of last year and we got around 30,000 additional enrolments across Australian universities as a result of the funding guarantees we've put in place.
Robbie: Ok, Simon Birmingham is with us this morning. Federal Minister for Finance. And of course, it's the morning after the budget. One other area of course, you were mentioning the pandemic and the need to stimulate the economy because of the pandemic and I guess Australia is a very different place to what it was pre-pandemic. But we are also facing huge pressures when it comes to climate and issues around climate. It's essentially being responded to, well in terms of budget spending last night, a disappointing budget when it comes to the environment. There was 263 million dollars for research and carbon capture and storage, for example, but not a whole lot of money elsewhere when it comes to renewable technology.
Simon Birmingham: Well what we're shifting the focus to now in terms of achieving our environment goals, our emissions reduction goals and driving Australia towards net zero emissions is a focus, certainly in relation to the goals we need to achieve in relation to hydrogen technology, in relation to soil capture. We can see in terms of the renewable energy space, the transformation is firmly underway. That our investments in relation to Snowy 2.0, creating the Battery of the Nation project with Tasmania, that were pre-existing commitments and that are underway at present. They’re projects that continue to sustain growth in the renewable energy sector by making continued investment in wind and in solar possible, because you've got that renewable energy battery back-up of hydro technologies. Now, our investments are focussed on meeting the stretch goals of how do you get hydrogen production to a level that is commercially viable, like renewable technologies have become so in the energy sector.
Robbie: But there's not a whole lot of new funding last night into renewables, is there? There's 30 million dollars for a big battery in the Northern Territory, what else was in last night that's new funding?
Simon Birmingham: So we are spending very significant sums to deliver Snowy 2.0. We already had that in the budget. So it's not, they're not new measures, they’re measures that we are delivering right here right now. But there are new measures in terms of around 1.6 billion dollars off the top of my head in relation to investment in emissions reduction activities that are about those hydrogen projects that we're supporting. New hydrogen generation hubs across the country, and that's about displacing other emissions intensive industries and contributors. As well as funding the global partnerships that we want to pursue in terms of emissions reduction opportunities, recognising that getting these new technology breakthroughs. We are firmly on track to see transformation in the energy sector when it comes to emissions reduction. To actually achieve net zero though, we need transformation in relation to industrial emissions, in transport emissions, in agricultural emissions. And that's why investing in these next waves of areas like hydrogen, like soil carbon, is so important to actually achieve a net zero outcome. It's not just about net zero in terms of electricity generation, net zero requires change right across the board.
Wendy: So when you look at our budget, this budget, I mean, how will you gauge its success? When will you say to yourself, ‘that budget really worked’, do you think?
Simon Birmingham: Wendy, I'll probably let that assessment go to the commentators, to the Australian people ultimately. Look our measure of success is to deliver on our commitments and plans. It's about job security for Australians and seeing the unemployment rate get to below five per cent. That's our plan.
Wendy: And once that happens, are you off to the polls?
Simon Birmingham: No, no. Look we will run the term of this government as expected, the election is due next year. That's when I’d expect it to be.
Wendy: All right. So I've got you there. I've written this down. You're looking for well under five per cent unemployment, we are not budging on our electoral cycle. We're not going early. We're going as expected.
Simon Birmingham: That is fully my expectation right now.
Robbie: And, Minister, I noticed that you did get pulled up a little bit yesterday for posting a photograph of the so-called budget tree, that wasn't actually the budget tree just before the budget. It might have been a little bit earlier in the season, looking a little bit healthier.
Simon Birmingham: Yeah, I did see a little bit of online commentary. If I'd taken the picture at the time we posted it, you wouldn't have been able to see the budget tree because it was dark. OK, yes. It was a picture from a couple of weeks earlier but the budget tree is iconic to Canberra.
Robbie: It is indeed. All right. Thank you so much for your time this morning. Federal Finance Minister and senator for South Australia, Simon Birmingham, just there.