SENATOR THE HON KATY GALLAGHER
Minister for Finance
Minister for the Public Service
Minister for Women
Date: Monday, 8 May 2023
ADAM SHIRLEY, HOST: Finance Minister, a very good morning. Thank you for your time.
SENATOR THE HON KATY GLLAGHER, MINISTER FOR FINANCE: Hi, Adam. Thanks for having me on.
SHIRLEY: First of all, to what many people hope will be day-to-day relief from their skyrocketing gas and electricity bills, I mean, it will depend on which family and how many hundreds of dollars relief they get, but is it really going to be enough in the scheme of things?
GALLAGHER: Well, it's an important part of the cost of living package, Adam, and we do accept that households have been doing it really tough. So we've been trying to find different ways through that cost of living package, to provide relief where we can, but without it adding to the inflation challenge in the economy. So I mean, it is, we do have a challenging set of circumstances here with inflation running high, with interest rates and the number of interest rate rises we've seen in the last year, and then also the impact that this is having on households, and how we find the right balance in responding to that has been important. Energy relief for homes and businesses is one of that, but you'll see other measures in the Budget as well.
SHIRLEY: Which ones for ACT residents, given our rents, the cost of housing here, and people try to balance all that up?
GALLAGHER: Well, we haven't been making these decisions based on a jurisdiction basis. You know, in that sense, we haven't looked at what we could do for Canberra, we've been looking at it across the board, of which Canberra is an important part, obviously. I would argue would be the most important part. But across the board, it's really about how we provide that cost of living relief across the country, because people are experiencing those pressures, as you say, in rent, in energy prices, in groceries, in all of those areas. And, you know, we've had to kind of take all of that into consideration as we make our final decisions. And you'll see that. I mean, the cost of living package is in the order of $14.6 billion. That's a big part of the Budget. And then we've also had to look at how we can make savings and reprioritise within the Budget. And also with the revenue upgrades, how much of that we're returning to the Budget so that, you know, dealing with this inflation challenge has been front and centre of our thinking as well.
SHIRLEY: I note some of the headline reports. And I know they're just headlines at this point, that there could be a surplus, that you and Jim Chalmers hand down tomorrow night, if that's the case, do you reckon many people who are really up against it with energy, with rent, will cop it?
GALLAGHER: Well, I think, what you'll see is a very significant cost of living package. So I think people will see the Government has tried very hard to make decisions around how to alleviate those cost of living pressures where we can, in terms of the revenue upgrades, and the improving Budget position. You will see that in the Budget tomorrow night – you'll have to wait to see the numbers as they're published. But I think an important part there is how much of that is returned to the Budget to assist with Budget repair. And the challenges in the Budget remain, like a short or a near term improvement is not, does not continue on into the out years or the medium term. And that's where some of those really significant cost pressures are coming our way in defence, aged care, health care, NDIS and costs of servicing the debt that we inherited. So all of that, you can see a Budget isn't one decision in isolation, Adam, it's like a whole range of decisions, and the Budget book is the balancing out of those decisions. And we're trying to do a number of things with this Budget, but cost of living is front and centre.
SHIRLEY: I guess, I get that. I mean, I've covered these sorts of things for many years. But in the meantime, a single mum or dad or a family that is surviving on one income, or a renter whose rent has gone up $100 a week, just in the last week, they might be wondering, “well, if the feds can actually generate a surplus, maybe it's the time to be giving some more immediate relief to all these people who are in such a historically high time of costs.”
GALLAGHER: Well, I think one of the challenges we've got, and again, I think when people see the Budget numbers, they'll see that whilst you do have a near term improvement, the Budget is still in structural deficit, Adam. So I think people will see that and they'll see the pressure the Budget's under, but part of our decision making has had to be mindful of the inflation challenge. And so just pouring money into the economy at the moment is not, well, it's not the right time to do that. So where we are making additional investments, they have to be targeted, and we have to be mindful of not making the Reserve Bank's job harder at the moment. So inflation is still high. It's coming down. That's very welcome, but the decisions we take in this Budget, have to be mindful of that environment. But you will see a very substantial cost of living package that's targeted to vulnerable Australians, but also has a reach beyond that, in terms of our child care changes come in on the first of July, our cheaper medicines policy will come in as well. And all of these impact on cost of living for individuals and for households.
SHIRLEY: Just a bit over 24 hours before the Federal Budget is handed down. I know this morning, you've provided some comments to the Canberra Times about no additional funding for a proposed ACT stadium, an idea that's been around for a long time, various iterations and ideas. But it looks like you've said you're open to working with the ACT Government if a formal plan is put forward by them. Does that imply that the ACT Government hasn't drawn up a detailed cost benefit analysis plan that you would otherwise be keen to act on?
GALLAGHER: Well, I think, and I was on your show earlier I think this month, Adam, when we were talking about the work the Chief Minister and I and others are doing, to basically have the Federal Government and the ACT Government work closely together on how we progress a range of issues across the territory, one of which is a stadium, obviously, but there are a number of other elements to that. And we will do that, we are, in fact, we are doing that. And the work on the stadium falls within that work, basically. But yeah, we haven't received a formal proposal from the ACT Government about, "this is the stadium we want to build on this site, and it cost this much". But that work, I think can be progressed through this broader agenda that the Chief Minister and I have agreed to, and we'll make good progress on that, I think, once we've landed all these decisions, the Budget work, over the next six months.
SHIRLEY: So are you surprised given how many years the possibility of a Civic stadium or Canberra stadium upgrade has been discussed, but to this point, there's not that formal plan and submission to you from the ACT Government?
GALLAGHER: No, I think it's about the ACT finalising, right, its own decision making and engaging with the Commonwealth. Up until the Albanese Government, I wouldn't have said you've got an open door, previously, for this type of discussion under the former government. So I think what we've got to do is seize the opportunity here and work together and see what's possible. I'm not saying we can do everything, but to see, genuinely, what's possible about investing in the ACT, whether it be stadiums, whether it be other pieces of infrastructure that I know people have lots of ideas on, whether it's in health, whether it's in land use and planning, a whole range of areas. I just think there's an opportunity here that we can seize, and I think Andrew and I are both keen to see how we can do that in the interests of the ACT.
SHIRLEY: So, if and when that more formal plan comes to you on a stadium, on a couple of the other things you just mentioned, how quickly would the Federal Government be willing, to put it bluntly, to pony up some money to help build it?
GALLAGHER: Well, it depends. That's a difficult question to answer, Adam, it's in the absence of some of those discussions and work. But I can say, we've got a Prime Minister that sees the value of the nation's capital. And you've seen that with the investment in the national institutions, the fact he lives here, the fact that he often speaks very fondly about Canberra. You've got me sitting at the table. There's a whole range of things. We've got Alicia, Andrew and David all advocating for Canberra. I can guarantee you that Canberra's interests are very well and strongly argued for around the Labor Government's table. And you know, there is an opportunity here. We don't want to miss it, but there's some more work to be done.
SHIRLEY: Right, Senator Katy Gallagher. I know there's still a few things, more than a few things, to work on before tomorrow night. I appreciate your time on Breakfast today.
GALLAGHER: Thanks for having me on, Adam.
Lisa Glenday 0403 931 209 | Gallagher.Media@finance.gov.au