Senator the Hon. Simon Birmingham
Minister for Finance
Leader of the Government in the Senate
Senator for South Australia
Date: Tuesday, 29 March 2022
Karl Stefanovic: Minister, good morning to you. Thanks for your time this morning. Big smiles. You've gone from pandemic spending to election spending. You're like the Imelda Marcos of Australian politics.
Simon Birmingham: Well, good morning, Karl, and happy budget day. This is a budget that will show we are banking the dividends of a stronger economy, that indeed we've managed to drive down and decrease rates of payments made by government to drive it down by more than any other government in the last 50 years. And so we are managing to achieve from a stronger economy, lower levels of government spending. That's going to mean lower debt and debt levels that will peak at an earlier point, lower levels into the future, lower deficits than had been previously forecast. What we also know-
Karl Stefanovic: Sorry. Where do you get where do you get low levels of spending from your spending like drunken sailors before this election?
Simon Birmingham: No, Karl. What we'll see here is, in fact, that there is a real reduction and a nominal reduction in the amount of spending by government. So we're being very careful here to make sure that we actually squirrel away and save some of the dividends of a stronger economy to make sure Australia is better positioned for the future. But we also know that Australians are doing it tough at present, that the war in Ukraine, the ongoing, ongoing aftershocks of COVID, they're all having impacts in terms of cost of living pressures, particularly at the petrol pump. And so there will be targeted, responsible cost of living relief to help Australians as well as the economic plan to keep our economy growing as strongly as it has been. That's driven unemployment to 4% already and gives us the opportunity to go even lower.
Karl Stefanovic: Okay. So it's no secret you mentioned the cost of living, right? Your $2.5 billion on cost of living easing and pressures will just well, won't it just get eaten up by the higher inflation and interest rates? Won't that be counterproductive?
Simon Birmingham: Karl, I think Australians know that, that the war in Ukraine, other factors have driven a real spike in oil prices. Now that's not expected to last forever. So what we want to make sure is that we deliver assistance that is targeted to address that and to help Australians through the pain they're feeling in those parts of their life right now. It comes on top of our income tax cuts that are already providing around one and a half billion dollars a month extra into the pockets of Australians to help with disposable income. And of course if we're re-elected, there's another stage, the third stage of our income tax cuts to be implemented in the next term of Parliament and to be delivered to Australians. And they will see around 90% of Australians pay no more than $0.30 in the dollar as their top margin-
Karl Stefanovic: I'm just not you've answered the question. $2.5 billion going to deliver in cost of living measures, savings for people at home. Won't that be eaten up by higher inflation and interest rates?
Simon Birmingham: Well, it's about responding to the pressures that are there. And of course, those pressures do involve global factors. As I said, we're responding here to spikes in oil prices, to other inflationary impacts, and we're doing it the same way we did through COVID, by being targeted, by making sure that things are temporary, to respond to temporary shocks, and by being responsible in how much we spend, but trying to help Australians and I think they will see that across a number of different spheres, not just any one particular payment. There is real help for cost of living pressures in the budget tonight.
Karl Stefanovic: So for example, I mean I think Australians need to know and they need to be able to budget for it and you would agree with that? What's to come? How long will the fuel price go down for? Is there is there a moratorium on it?
Simon Birmingham: Well Australians need only wait until 7:30 p.m. tonight to get that level of detail. But, we are going to hand down a budget that does respond to those pressures, does help ease those immediate cost of living pressures. As I said, the forecasts for oil prices are that they will stabilise again, but they're hurting right now. That's why we want to deliver support in terms of helping Australian households right now. That's why we're also going to ensure, though, that we don't shy away from the long term economic recovery to keeping jobs growth going in Australia to get unemployment below 4% to levels not seen since 1974. In terms of the budget forecast of 3.75% unemployment, that's involving investment in skills, investment in manufacturing, investment in our digital economy, support for small businesses. All of that will be detailed tonight in the budget.
Karl Stefanovic: Finally, the Prime Minister was working the phones last night trying to convince Papua New Guinea and Fiji to convince the Solomon Islands to back out of the deal with China. I mean, is that how bad things are over the Solomon Islands that you're relying on Papua New Guinea and Fiji to do the dirty work for you?
Simon Birmingham: The Pacific family always works as a family, and it's about all of the Pacific Island nations and others in the region working together. Now Australia has got a very close relationship with the Solomon Islands. We were the first country they called on to come and help with their troubles and to send our police force in. Last year we they asked us to extend our bilateral security treaty with them and we are by far and away their largest development partner. And so we continue to have dialogue with the Solomon Islands as we do with all of the countries across the Pacific. But it's a reminder, again, that we face uncertain times and the challenges of China's greater, more assertive approach coupled with that of Russia elsewhere in the world. It's all an important part as to how we invest and support our national security. And that, again, will be a feature in tonight's budget that investment in our defence forces, which Labor neglected so much.
Karl Stefanovic: Simon Thank you. Appreciate it.