PATRICIA KARVELAS, HOST: Prime Minister, welcome to RN Breakfast.
ANTHONY ALBANESE, PRIME MINISTER: Good to be with you.
KARVELAS: Prime Minister, this is a Budget that's been framed around making difficult decisions in difficult times. But haven't you kicked some of those big decisions down the road?
PRIME MINISTER: Not at all, Patricia. We have made difficult decisions in this Budget. We've returned 99 per cent of the revenue upgrades to the bottom line, for example, over the next two years and 92 per cent over four years. We have been straight with the Australian people by saying that we do face difficult times. There are headwinds, we've seen the fastest and most consistent tightening of monetary policy by central banks that the world has seen in many a decade and that is placing pressure on inflation. And that's a context in which we had to deliver during this Budget, including delivering on all of our election commitments.
KARVELAS: Will you, though, need reform on government spending and tax reform? And will this happen in this term of your Government?
PRIME MINISTER: Well, the job of reform is never done, Patricia. My Government is a reforming Government. What we said we would do in this Budget, we have done. We've said we would gone through line by line taking out much of the waste and rorts from the Budget, $22 billion of savings. But we've also provided targeted cost of living relief to Australian families. And we've taken a responsible approach to managing the economy, whilst we've delivered on our substantial commitments that we made to the Australian people before the election, commitments like cheaper child care, cheaper medicine, more affordable housing. We want to get wages moving again. We want to build a stronger and more resilient economy by investing in infrastructure, investing in the National Broadband Network, investing in clean energy. And you've seen that in this Budget.
KARVELAS: Yes, certainly that's what you've done at this point. But I just want to ask very clearly, is tax reform on the agenda in this term of your Government?
PRIME MINISTER: Well, our focus last night was certainly not on taxes, it was on delivering.
KARVELAS: Is that coming?
PRIME MINISTER: Look, we will have a discussion with the Australian people over coming years about reform. The job of reform is never done. The job of reform has to be continuous. I want Australia to be as strong and resilient as we can be.
KARVELAS: And you believe that should happen before the next election? Or do you think you need to get a mandate for such reform?
PRIME MINISTER: You always engage in the business of reform. We've been consistent in delivering on the commitments that we made to the Australian people. The big thing about last night's Budget is that it sees monetary policy working with fiscal policy. The idea that we could go out and have cash splashes, that that could continue, that we could continue to have the same approach the former Government had, for example, where almost $20 billion of its JobKeeper payments went to companies that were actually increasing their profits – that’s the sort of profligacy and economic irresponsibility that we had to turn around. We've done that. We have another Budget in May. We'll have another one the year after and possibly another one as well. This is the first step that we needed to take towards turning the economy around, moving towards responsible economic management and delivering for the long-term.
KARVELAS: Prime Minister, the Budget paints a grim picture of electricity prices. Bills will go up by 20 per cent this year and then 30 per cent next year, it's staggering. For someone with a $500 energy bill, they'll be paying around $780. This is a huge increase that's going to hit people, families, pensioners. Is your election promise of cheaper energy bills dead?
PRIME MINISTER: Our election promise was consistent with the modelling that we took to the election, which was about the fact that the cheapest form of new energy is clean energy. What we've seen from the former Government and what we have inherited was four gigawatts out of the system and only one gigawatt into the system, that's the practical example of why there simply wasn't enough investment. Now, you've already seen, as a result of our policy, which is essentially implementing the Integrated Systems Plan of Rewiring the Nation. You've already seen agreements reached last week with Victoria and Tasmania, including the Marinus Link, which is a major proposal that could never get done by the former Government that will make a difference. That will make an enormous difference.
KARVELAS: There's no doubt that those investments are really key in transforming the market. But they don't help families in the short-term, do they? And you did promise to cut power bills, that promise is dead now, isn't it?
PRIME MINISTER: Cheaper power bills will come as a result of investment in cheaper energy. That's just a fact.
KARVELAS: But not next year.
PRIME MINISTER: That will take time, of course. We can't turn it around in one month. And remember that the former Government actually changed the rules, they introduced a new system to avoid telling the Australian people that the power price increases that were baked in, that were due to occur, to keep from the Australian people that significant increase that occurred in the middle of this year.
KARVELAS: The Treasurer talked about possible regulatory interventions to help ease some of the rise in electricity prices and reign in those fossil fuel companies. What does regulatory interventions mean, Prime Minister?
PRIME MINISTER: It means regulatory engagement, intervention into the market, which is something that we will give strong consideration to. We'll be taking the advice of the appropriate departments about an appropriate intervention. We understand the pressures that are on here.
KARVELAS: What options are available to you, though?
PRIME MINISTER: Well, the ACCC has an important role to play here, the Australian Competition and Consumer Commission, to ensure that we don't see any price gouging that we're not seeing any companies taking advantage of the international circumstances which are there. There is a global spike in energy prices directly resulted from the Russian invasion of Ukraine. This is feeding into global inflation. These are circumstances that we have inherited, and we will be prepared to take the advice of the ACCC, the regulatory body, but also of our departments for any further action that can be taken.
KARVELAS: And how quickly will that happen, Prime Minister, given we're seeing these soaring prices that are really going to hit people particularly on fixed incomes very hard?
PRIME MINISTER: Well, we've already taken action, Patricia, when it comes to securing supply. And you saw that over recent weeks where we announced the agreement for the non-contracted gas to be made available here in Australia.
KARVELAS: But it hasn’t done anything to prices?
PRIME MINISTER: You've already seen the Government with our shoulder to the wheel. But the first step was to ensure supply. When you ensure supply, then you have an impact on price. And we'll continue to look at further regulatory measures as the Treasurer flagged yesterday.
KARVELAS: Spending on the National Disability Insurance Scheme could hit $102 billion in a decade. It will be well and truly the most expensive Federal Government social program if you do not rein in the scheme's costs. What's gone wrong with the NDIS? Why is it growing like this?
PRIME MINISTER: What we know is that there's a substantial amount of waste in the NDIS. This is a very worthwhile program, let's be clear.
KARVELAS: No doubt.
PRIME MINISTER: I think it has enormous support. But we need to make sure that it's sustainable in the future. We flagged this during the election campaign, you might recall, about ensuring that that waste was reined in, that there was appropriate support given to the NDIA with an increase in staff so that there's proper management of this, because of the nature of how the scheme works. We want to make sure that Australians with disabilities get the support that they need, because that will actually add to the economy. The full participation of people with disabilities in our economy and in our society is not only good for them, it is good for all of us.
KARVELAS: Prime Minister, do you have to rein in the states there? Do you have to rein in the states and actually get them to do more heavy lifting here? Is that part of your strategy?
PRIME MINISTER: We certainly will be engaging with the states. And that's something I have already flagged with the state premiers and chief ministers.
KARVELAS: What have you told them? What are you going to do?
PRIME MINISTER: I've already flagged with them that it's an issue in which we need to have a cooperative arrangement because of the way that the funding of the NDIS occurs. Largely, all of the heavy lifting falls on the Commonwealth rather than states and territories.
KARVELAS: So, have you told them they have to pay more?
PRIME MINISTER: It's not about them paying more. What it's about is making sure that we have appropriate management of the system to secure the best outcomes whilst making sure that it's financially sustainable into the future.
KARVELAS: Very briefly, Prime Minister, the promise of one million houses over four years from 2024. How did you come up with that figure? And isn't that just how many houses we were building anyway?
PRIME MINISTER: Not at all. This is substantial new investment. Of course, there is our investment in social housing and community housing that we flagged before the election campaign. But what we're talking about here is mobilising superannuation funds, other managed funds as well, into the housing sector in a way that creates jobs, that builds houses that therefore places downward pressure on the cost of housing so that people can have access to it. We know we need to increase supply of housing in this country. What this is about is how we mobilise private sector investment in the housing sector, as well as the additional support that will be given directly for social housing investment.
KARVELAS: People who are desperate for help didn't get any in this Budget because, as you say, the inflation pressure. What is your message to people who have disappointed by your Budget?
PRIME MINISTER: That what we're doing is making sure that we have a sustainable Budget going forward. That if we had have handed out money, what that would have done would have ensured that fiscal policy, basically the Government's Budget, was working against monetary policy. That would have meant that central banks would have been encouraged to further tighten monetary policy and you end up in a counterproductive system. You had to have a Budget that was responsible for the times while looking to the future. And that is what we've done last night in the Budget, with clear support for cheaper child care, cheaper medicine, more Paid Parental Leave, more affordable housing and higher wages.
KARVELAS: Prime Minister, many thanks for joining us.
PRIME MINISTER: Thanks, Patricia.