Transcripts → 2022


Radio Interview - ABC RN Breakfast

Minister for Finance
Minister for the Public Service
Minister for Women


Date: Monday, 24 October 2022

Budget savings and repair; economic outlook; funding for additional university places; payrise for aged care workers; violence against First Nations women and children

PATRICIA KARVELAS, HOST: The Government promised to find waste and rorts line by line in the previous Budget and has today come up with a dollar figure on how much can be saved. The Finance Minister Katy Gallagher joins us now. Minister, welcome to breakfast.


KARVELAS: $10 billion will be cut from spending and another $11 billion in spending will be adjusted. So, there'll be delays beyond the forward estimates over the next four years. So where is the $10 billion dollars of clear cuts coming from?

GALLAGHER: PK all of this will be outlined in the Budget but obviously there's been a fair bit of interest in the work that's being done on the spending audit across Government. So we've found in total about $22 billion worth of saves, which we are able to partly return to Budget for Budget repair, but also to reallocate or reprioritise to better align with Government priorities. Those savings have been found across Government so it's, like across a whole range of portfolios and departments. And we'll outline all of that in the Budget tomorrow night.

KARVELAS: And when you say saves, some of it will be spent just later, to be clear, and that's the $11 billion which is being adjusted. What are you delaying beyond the forward estimates, Finance Minister?

GALLAGHER: Well, in terms of some of the infrastructure spending that has been re-profiled, and will be worked through with Catherine. Obviously, that's a really big infrastructure project, it's $120 billion over 10 years. So there are some challenges with particular projects. There's some issues with accessing materials and workforce. So, I think it's very sensible to look at where we can find some, you know, reprofiling of that, but there will be also some some genuine savings in that portfolio, but it's not exclusively infrastructure. We are finding savings across Government. We have gone to every single department and asked them to look at their programs to identify programs that don't need to be done any longer or don't align with Government priorities and where we've been able to return some money to the Budget we're doing that. The other part of it is actually not adding new funding to things but using existing funding to fund some of our priorities. So it's been a very useful exercise and I think $22 billion is a pretty reasonable figure to have achieved over just, you know, a couple of months in Government.

KARVELAS: Is there more fat that can be trimmed in May or have you run out of fat?

GALLAGHER: Well, my view as Finance Minister is that this is a process that should keep going. We've identified, obviously, some of the short term work and that will be reported in the Budget but this spending audit should keep going. We should do it in every Budget, just to make sure that we're constantly looking at ways we're spending money and I think the Australian public would expect us to do that, that it's not always adding in new spending when there's, you know, need that arises and there will be, but we're looking at existing expenditure as well and how we can reuse that or re-align it with, you know, new investments. So, yes, it's an ongoing piece of work in short, and I think the other thing I'd say is some, the audit has identified areas where we just need longer to work through as the Finance Department to see whether there's opportunities for again reprioritisation, or savings.

KARVELAS: Can you give me a sense of where those areas where you need longer where they come from? What areas are they?

GALLAGHER: Look, there's, it's across a number of departments. I think where we're just looking at, you know, it's really just having the time to work back through and see, you know, whether there's areas where there's duplication of programs and I think that that can happen over time in Government where you start a program, you know, a couple of years later, you might come in and there's a new way, you know, a new program, which essentially can do the same thing. I don't want to really single anybody out at this point because I need to work with my colleagues over the next few months to work through some of that, some of it might come to nothing, but at the end of the day, we're looking and we know that spending restraint is part of the challenge of Budget repair. It has to be part of the next couple of years of work that we do, we can't just keep adding to new spending.

KARVELAS: A few of my listeners are rightly asking what does reprofiling mean? My understanding of what it means from reading all the information is taking money away from some of the projects that the former Coalition Government promised and spending it on projects you think are important, including your commitment to this suburban rail loop project in Melbourne, a $2.2 billion project, but that hasn't been recommended by Infrastructure Australia. So how have you come to conclusions like that that is a good use of spending?

GALLAGHER: Yeah, so the, I'll go to the first bit first, the reprofiling it's a couple of things. So one, it can be that you, you know, projects aren't ready, there's more work that needs to be done and so you're shifting them out a couple of years before making any decisions. There's definitely projects that we will be stopping, so that's slightly different. And on the suburban rail loop, this is one that we have been working with the Victorian Government on, there is a very detailed business case that underpins this project and a very positive cost benefit ratio for the project and the Victorian Government I understand, not only working with us, is talking to Infrastructure Australia about that, that project. So I think at the end of the day, and you can speak to Minister King about this, her position that she comes in as Infrastructure Minister is really looking at the, you know, the rigor that sits behind some of the projects in infrastructure making sure they have rigor, putting in good process and then making decisions based on that.

KARVELAS: Expected GDP growth is 1.5% in 2023-2024. That is actually a percentage point down on what was expected in the March Budget. What does that say about how much trouble the economy and your Budget is in?

GALLAGHER: Well, I think it's, all Australians have realised there's a lot of uncertainty globally across the economies of the world. We've got rampant inflation, we've got issues here locally with inflation, rising interest rates, and that's having an impact. I don't think anyone would be surprised by that. But it has been a challenging set of circumstances for us to put a Budget together in, you know, we're having to be very clear that where we are spending we're not adding to the inflation problem. We've been honest about some of the challenges the Budget faces and honest about some of the challenges the economy faces, and then aligning our policies to deal with some of those challenges. I mean, we've got a lot of things going for us here. But there are challenges, no doubt, and that's why some of our policies which we will be funding in this Budget, become even more important. So you know, some of those productivity policies like around skills, around dealing with climate, some of the participation policies like childcare and PPL, all of these, you know, have to pay off with an economic dividend it's not just spending for spending's sake, these are investments into our economy and to deal with some of these challenges.

KARVELAS: Minister, there will be detail on your election commitment to fund 20,000 extra university places, where will those places go? What kind of courses are you prioritising?

GALLAGHER: Well, if you don't mind Patricia I think this is something I'd leave to the Minister for Education, he'll be making some of those announcements today. But you know, investment in education is also part of our focus in productivity enhancing investments. I mean, there's no doubt that universities have suffered, they suffered terribly through the pandemic and we made some commitments through the election about supporting universities, increasing opportunity for people to get into university and we'll deliver on that in this budget.

KARVELAS: Now, during the election, you pledged to fund pay rises for aged care workers and that decision, I understand is looming. Is that going to be factored into the Budget?

GALLAGHER: There'll have to be some provision made. I mean, obviously, we don't know what the commission is going to find. But we are expecting that there will be you know, a significant increase for aged care workers and we welcome that. But, you know, we really aren't in a position to go any further on that until the commission comes down with their decision but you know, making sure that we're dealing with again, the significant challenges in the care economy, dealing with low paid work, dealing with the feminised industries like this is a key priority for us and we will be responsible about meeting some of those costs. We see them as investments, particularly as the care economy increases as a share of you know, jobs and opportunities over the next few years. It's important that the Government supports those professions.

KARVELAS: Being able to increase pay in these really feminised industries is a priority for you and the Government, as you've just said. Do you think ultimately like level with us, the taxpayer should be responsible for meeting that bill, of what you've identified as an entrenched societal problem and how is the Budget going to be hit by that?

GALLAGHER: Well, again, yeah, I don't think it'd be any surprise to your listeners that in the areas, aged care is one of those areas where we're seeing significant growth and there is a role for Government in helping to meet some of those costs. Obviously, there are different you know, in childcare and aged care, there are, you know, consumer costs as well, but there's no doubt the Government has a responsibility here to make sure that elderly Australians are able to get the care they want, where they want and how they want. And I'm not pretending that that isn't a significant challenge for us in Government, but it's a challenge that we believe it's our responsibility to meet and we'll be doing all of the work that's needed to make sure we are building and creating an aged care system that works for the people who need it. And that's what we haven't seen in the last decade and it's something that we're deadly serious about getting right, now.

KARVELAS: Minister, you're the Minister for Women and Four Corners tonight is investigating systemic issues behind the deaths of Aboriginal women in Australia. They're up to 12 times more likely to be murdered than other women. You have committed to having a specific agreement which deals with violence against Aboriginal and Torres Strait Islander women, but it's unfunded at this stage. Will there be a provision in the Budget for putting significant and important investment in this area?

GALLAGHER: PK this is an area where Amanda Rishworth and myself are looking closely at along with Linda Burney. We will have that action plan for First Nations women that comes and sits alongside essentially the National Plan to End Violence Against Women and Children. I had some meetings last week on this subject around the deaths of First Nations women across Australian communities. And it is just, it's shocking, the reality of the lived experience of many women across Australia. We have to deal with this problem. I mean, I would love it if we didn't have to invest over you know, one point, well, it's over $1.5 billion in addressing violence against women and children in this country, you know, wouldn't that be a great position to be in. Unfortunately we're not, because violence against women and children is so prevalent in across Australia, First Nations women experience it at much greater levels, and we have to do something about it. And I commit myself and my colleagues to working closely to particularly with First Nations communities, First Nations women, leaders, to do what we can to support them better.

KARVELAS: Finance Minister and Minister for Women Katy Gallagher, thanks for joining us.


Thanks very much PK.


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