SABRA LANE, HOST: Good morning and welcome to AM. I'm Sabra Lane coming to you from Nipaluna, Hobart. The Economic Roundtable at Parliament House in Canberra next week has no shortage of ideas. Suggestions include a cut in the company tax rate, expanding the Goods and Services Tax, a new road user charge to include electric vehicles, and now a four day working week. The Reserve Bank has made sure boosting productivity will be front and centre at the summit. While cutting the official interest rate yesterday by a quarter of a percentage point, the bank revised down long term forecasts for Australia's productivity rate, meaning the economy will be smaller and poorer than otherwise expected. To discuss that and other issues, we’re joined now by the Prime Minister Anthony Albanese, welcome back to AM.
ANTHONY ALBANESE, PRIME MINISTER: Good morning Sabra. Good to be with you.
LANE: Home borrowers are relieved that the bank has cut interest rates yesterday and has flagged the possibility of potentially more before Christmas. You'd be happy with that. But the Board also delivered something of a wake up call with its message about productivity. How do you view that productivity challenge?
PRIME MINISTER: Well, we certainly need to do better on productivity. It's been pretty flat for more than two decades now, and that is one of the reasons why we're bringing people together from business, from unions, from civil society to have those discussions. But yesterday - we shouldn't get away from what yesterday means for your listeners. For a household with a mortgage of $700,000 that will save around $1,300 a year. It’s a third cut this year. And together with real wages which are rising, inflation which continues to be low, at the bottom end of the RBA band, which is why they have cut rates, and unemployment relatively low at 4.3 per cent. The economic news now compared with when we came to office is certainly much more positive.
LANE: Ok, well given all of that then, what is your expectation then on fixing the sluggish productivity rate? Can this Government oversee a turnaround in three years?
PRIME MINISTER: It's certainly our objective not just to do it in three years, but to put in place measures that improve productivity over a long period of time. That's why we're looking at areas including regulation, including getting more efficiency in our energy system, including of course, better planning approvals. One of the things that is holding up our progress towards the 1.2 million new homes that we've committed to by 2030, is planning approvals. And we're working with states and territories to clear that backlog. And one of the things that has happened as a result of the convening of the Roundtable is that ideas are coming forward. Now, many of them are people putting forward, I guess, in their own interest, but many of them as well are certainly in the national interest, and we'll take all of them on board.
LANE: The Financial Review is reporting today that you and Jim Chalmers met face to face last week to rein in some of those expectations around these ideas at the summit. Is that right? How big an appetite does the Government have in reforming how the economy functions?
PRIME MINISTER: We're up for ideas, and the Treasurer, myself, and the Finance Minister, and others are certainly up for ideas. We have, of course, a big agenda that we were elected on May 3. But ideas, whether they be things that can be implemented immediately, some things that can feed into next year's Budget, or whether they be measures that we'd consider committing to for the next term of Government, these are all things that are worthwhile, and I always think it's valuable. I had a really successful meeting with some business leaders on Monday evening in Melbourne, and some of the ideas that we kicked around there are really positive. They'll feed into our processes, and that is how good governments should operate. We're an inclusive government. We are up for consultation and we're up for ideas. And if ideas are good, and they're implementable, and they're consistent with our agenda, then certainly I think there'll be many positive initiatives will come out of the Roundtable next week.
LANE: We'll get to some of those ideas in a tick. But just on that reporting, did you and Mr. Chalmers meet face to face last week to sort of raise some of the -
PRIME MINISTER: We meet every week, Sabra. Yeah, we meet face to face. Not just last week, but this week around the cabinet table, at ERC, one on one. We meet every single week. We talk every week, almost every day. We talked yesterday. We talk every day either in person or exchange messages. Certainly yesterday it was all about the RBA decision that is so welcome.
LANE: Some ideas include a tax on business flow. You've already said that you're only going to implement tax change that you took to the last election. But if there are new big ideas that the Government’s keen on, would you seek a mandate before putting them in place?
PRIME MINISTER: Well, it depends what they are, Sabra. You know, we're up for discussion. And one of the things I said very clearly was we weren't going to get into the rule in, rule out game. We have a big agenda. We were elected with it with a clear mandate on May 3rd. That's our priority, is delivering on that -
LANE: Okay.
PRIME MINISTER: But we’re also up for - we’re also up for ideas and we're up for things that can be done immediately. Of course, if they will improve the economy, then of course we'll give it consideration. But that will be, of course, a decision for the Cabinet. I run a proper Government. And the chaos of the former Coalition Government with their revolving door of Ministers is gone -
LANE: I'm just trying to suss out, though, Prime Minister, you keep saying you're up for discussion, but I'm trying to suss out how. What is the appetite for the Government in next week's summit? Will it change much at all? Will the status quo remain? Or are you up for big reform?
PRIME MINISTER: I'm up for big reform and we are a big reforming Government. The changes that we're putting in place, one of the biggest revolutions that we've seen is the shift to a clean energy economy. Later today, I'll be in Brisbane this morning looking at one of the 28,000 batteries that have been installed since July 1st as a result of the commitment we took to the election. That is 491 megawatt hours, almost the equivalent of four of the Hornsdale big batteries, which at the time was the biggest battery in the world. That is not only making a difference to households in terms of reducing their energy bills permanently, but is also taking pressure off the grid. We are up for big reform, whether it's strengthening Medicare, the changes to child care, the benefit to education, where we've got the Gonski reforms agreed to, that were talked about in 2012, but we're actually implementing them together with state and territory governments.
LANE: On the situation in Gaza, Australia has joined with 25 other nations overnight to warn that humanitarian suffering there has reached, quote, unimaginable levels. Famine is unfolding. That urgent action is needed now to halt and reverse this situation. The statement says, ‘humanitarian space must be protected and aid should never be politicised’. Why is Israel doing this?
PRIME MINISTER: Well, that's a question for Israel, of course, but I think it is not defensible. Israel made the announcement in March that they would put restrictions on the flow of aid and we're seeing the consequences of that. We have a humanitarian catastrophe unfolding in Gaza -
LANE: Some argue that deliberate starvation is a war crime. Is that what you think is happening here?
PRIME MINISTER: It's certainly not something that's consistent with international law. We have a circumstance where people can see it on their TVs every night, in spite of the restrictions that's there on the media entry into Gaza, people are witnessing people who not only are suffering enormously, and starvation and loss of life - but we're also seeing people killed while trying to get access to food and water. Now, in 2025, that's completely unacceptable. That's a position I put to Prime Minister Netanyahu when we discussed these issues last week.
LANE: Is it a war crime?
PRIME MINISTER: Well, people will do - there are processes for those things, quite clearly it is contrary to international law. And it's also, you know, to get around - you can get around all these definitions. What I would say very clearly is that it is an affront to common decency and common humanity what is happening in Gaza.
LANE: On Palestinian recognition, the White House has declined today to criticise Australia's announcements, telling Nine newspapers that it will, that Mr. Trump is not married to any one solution in the Israel-Palestine conflict. What's your reaction to that?
PRIME MINISTER: Well, President Trump and the United States, of course, will make their own decisions. They have a critical role to play. One of the things that has defined President Trump's position internationally on global affairs is that he is an advocate for peace, and he's been an advocate for peace in the Middle East for a long period of time. And the United States has an important role to play.
LANE: What's the likelihood of you meeting Mr. Trump while in New York next month for the UN General Assembly?
PRIME MINISTER: Look, we will meet at some stage. Those things are worked out through officials. We've had three very constructive discussions which indicate a positive relationship. And that is what President Trump has said himself as well.
LANE: Anthony Albanese, thanks for joining the program this morning.
PRIME MINISTER: Thanks very much.