There are certain traditions and rhythms around the Federal budget. There's a particular tree at Parliament House that always turns red Ozzie's coffee shop. Inside the building heaves with lobbyists and anyone with even the most remote connection to be in Canberra and shows not usually interested in politics.
Well they give it a crack.
Prime Minister. That debt isn't necessarily real, it's a number, and that I think most governments, not just the Australian government, governments around the world. They know that the world's going to be ending at some point in the future. So you guys are just going to continue spending because who cares. The debt won't exist when the world's done.
Anyway, Well, we are not planning for the end of the world. What we are doing is that a better future rather than no future, which is what the end of the world would represent. But thank you for the contribution.
From Schwartz Media in seven Am. I'm Ashlan McGhee. This is the cost inside the living crisis. It's now we're starting to get a real sense of how the budget's landing.
So as the treasure is spent.
Enough to help people out and we'll even remember it when it comes time to vote. Today contributor to the Saturday Paper, Paul bon Jorno on where the battle lines are being drawn. It's Thursday, May sixteenth, So Paul, this budget is only thirty six hours old. But we know we're going to be talking about this one a lot as we head towards the next election and as we try to get out of this cost of living crisis. So what are the early criticisms that we've heard of the budget?
Well, Ash, it was a shadow treasurer Angus Taylor's job to be the first coalition to hit the airwaves just an hour or so after the budget was delivered, and from the coalition's point of view, there's a lot hanging on Taylor's performance.
Angus Taylor, welcome to the program.
Could to be with you?
So I just heard a discussion well on the ABC seven thirty program with Sarah Ferguson after the budget was delivered. He attempted to skewer the government by saying it had spent too much and that spending would make inflation worse.
If your plan to spend a lot of money, it's inflationary. We've got a sixteen percent increase in spending over two years and the economy is only growing at closer to seven percent, So that's spending growing at double the pace of the economy and.
That But the problem for Taylor is earlier in the day before the budget was delivered, he'd been out there saying the government wasn't spending enough to support households. This left him in a pretty uncomfortable position when asked whether the Opposition would support the government's support for households.
Do you support the government's billions of dollars in subsidies to those struggling Australians Do you support that?
Well, what's clear in this budget is they're not going to the source of the problem. They're putting a band aid on a bullet wound.
I me just staying with that particular question do you support.
But this is the context is incredibly important and I will answer that question.
But the context, well, ultimately he said the budget was a band aid on a bullet wound. But with the election looming, he didn't make the same mistake the Opposition made with the first Energy Bill relief package. You might remember they voted against it. Well, this time with an election looming within twelve months, at the latest they'll be voting for it.
So we will support that, but not because we think that's ultimately the right answer. Labor has failed to deliver the energy price reductions they promised before they came to power.
And so the coalition itself hasn't pulled together a coherent story to really help its shadow treasurer to get onto the front foot. It sort of leaves him with nothing much more than strident criticism. So on Wednesday morning, Peter Dutton had to go and we got his first reaction.
Peter Dutton, thanks for joining am Pleasure Sabra. Thank you, every household rich and Paul will get three hundred dollars.
He confirmed the Opposition would vote for the government's student debt relief and energy bill relief and rent relief.
So are you going to support it or not, Well, we'll support.
Measures which provide relief and obviously this comes in this budget before the election in any case, but we do know that families under this budget, a typical Australian household with a mortgage is more than thirty five thousand dollars worse off.
Okay, that is a huge.
Dutton picked up on the concerns of many in the commentariat, you know, economists and the like, that the budget risks fueling inflation, despite the Treasurer's confidence it won't. But Dutton may well be right that Australians may have to wait longer for an interest rate cut or inflation may well rebound sometime in the future.
What they're sneakly trying to do is get an interest rate reduction before the election, but then rates will jump back up after. So I think there's a spoken mirrors game going on here, and giving three hundred dollars to people who are promised much more than that by why of reduction of their power prices is just not going to cut it for the average family.
This makes tonight's budget reply speech all the more interesting. Surely the pressure is now unduteen to come up with some serious and costed alternative policies.
Right So, do we have any sense of what the opposition's alternative would be here? Like, what hints do we have about what that'd be doing with the budget right now?
Well, there have been hints in the last days that they could promise even greater tax cuts. Angus Taylor and Senator Jane Hume, the Shadow Finance minister have made hints in the media that this is the direction they intend to go in Treasure Jim Chalmers has responded to those hints by putting the pressure on the Opposition to announce something concrete. Earlier this week he said they're all over
the shop when it comes to these tax cuts. Charmers said if the Opposition is going to give bigger tax cuts to people with high incomes, then they needed to put a plan for how they intend to pay for it and tell the Australian people tonight. Tuesday Night's figures show that while the government has found a surplus now and can make a debt in paying down debt, still by twenty twenty five twenty six, according to the budget papers,
Australia will hit one trillion dollars of gross debt. And that's simply because the cost of programs we already have like health, aged care and the NDIS as well as defense, are set to grow over time along with interest on our existing debt, and the revenue isn't going at the same rate. That's what we mean when we talk about structural deficits. But Ashton some of the harshest criticisms of the budget came not from the opposition but from the minor parties and the cross bench.
Right Paul, So, we know the cross Bench has been pretty vocal and pretty influential as well during this parliament. But have they been able to put forward as serious critique of this budget that kind of gives us an indication of how they'll fight the next election.
Well, the loudest voice has certainly been Jackie Lamby.
We're obviously getting this three hundred not means tested.
What are we back in.
COVID days where we're just chucking money left, right and center.
She slammed the three hundred dollars energy rebate for all households, saying that the government should have means tested it to spend more money on people struggling.
Seriously, you're too lazy to do some means testing. We don't need three hundred dollars, I can assure you, and that should have been passed forward.
I thint a.
Senator David Pocock actually put an alternative on the table, arguing that if the government invested in electrifying households instead of a one off three hundred dollars rebate going to each home, they would have made energy bills cheaper for Australians permanently.
The other bit I think that is missing from the future made in Australia is household electrification. It is such a.
Huge he said, the government needed to show we could be much smarter as a country. Amanda would have set up households to save thousands every year.
When we look at three hundred bucks to every household in Australia, I think we would be much smarter as a country investing in household electrification, where households can be saving two to five thousand dollars every year going forward. We know that it's anti inflationary because you're locking in the price of electricity.
And when it comes to the other major minor party, if I can put it that way, the Greens, they made it clear in their reaction that they do intend to fight this election on housing and rentals, with leader Adam Bant putting the issue at the heart of his early response to the budget.
Labour's band aid budget is a betrayal of people who are doing it tough. It's a betrayal of renters, of mortgage holders, of women, of students.
He linked this to inflation, saying rent is a massive driver of inflation, and the housing crisis is breaking people.
Labor's tightening your belts while letting big corporations and billionaires run wild. There's a lot more that would have been crisis.
But we have to take into account that we're in the last year of the electoral cycle and we have to run a filter over much of this criticism. Charmers, as the Treasurer in government, has to keep a broad swathe of the electorate and demands on him as on site as possible, and there is confidence in the government that the Treasurer has positioned Labor well on that score.
Coming up after the break, my deficit smaller than your deficit.
What a very camera argument, Paul.
This cost of living crisis has gone on for longer than pretty much anyone predicted, and inflation remains high.
Voters are crying out for help. Do you think the Treasurer.
Has promised people enough or will he face that criticism that he could really have been a bit more generous.
Well, there's no doubt millions of voters are frustrated with their struggle to make ends meet. The remarkable thing is Charmers in this budget has delivered a surplus and meaningful relief on energy costs, rent relief and health especially through the freeze on prescriptions through the PBS. And while we have forecast deficits, it frustrates the Treasurer that critics don't compare these forecasts with those of the last coalition budget,
which is still within the budget cycle. He said on radio on Wednesday morning that next year's deficit, predicted to be twenty eight billion dollars is nineteen billion dollars less than Josh Friedenberg was forecasting for the same year in his last budget. And the other point to make is the tax cuts and the rebates, the rent relief, the student loan repayment relief. All these measures kick in in
just two months time. The tax cuts will actually start turning up in people's paper packets, and the electricity bill relief along with the rent relief will be noticed, helped by the fact the government has allocated forty million dollars in multi platform advertising just to remind everyone and Ashland
there is another factor to take into account. Treasury has been ultra conservative in predicting where commodity prices will be iron or down from one hundred and ten dollars a ton we're actually getting predicted to go down to sixty dollars. Now I can tell you the budget will be looking a lot healthier if that proves to be way off the mark on the downside.
And so looking ahead towards the election that we all know is coming in the next year or so, Paul, what.
Does this budget tell us?
Do you think about where labor believes they can win and the kind of voters that they're keen to win over.
So when you look at where the government has landed with slowing inflation, you know it's half what the charm has inherited just two years ago. And we've got rising wages, especially for the care sector, and every household in the country and every taxpayer getting something. The challenge for the opposition is to say, what of any of this they would not do. Sure, they can talk about the risk of inflation and interest rate rises, but it's the Reserve
Bank's view that will be critical here. But we do have to remember the economy is weakening. The numbers actually have it closer to a basket case. So the next movement in interest rates will be down. It's just a matter of when.
So many have said that this budget is pretty much the starting gun for the next election campaign, but of course we still don't.
Know when that will be. Did last night give you any.
Clues about when exactly the government might call it on?
Well?
In the budget lockupres conference, the Treasurer said he was working to the economic cycle and not the political cycle. He said he was doing what the circumstances domestically and internationally were demanding. But I have to say this budget looks and smells like a pre election exercise. But on that it's over to the Prime Minister and when he judges is the most opportune time for him to pull the trigger and win the race.
Paul, always good to speak to you. Thanks so much for your time.
Thank you Ashland.
Bye tomorrow.
On the cost I'll be sitting down with Treasurer Jim Chalmers to ask whether this budget is good for young people when he thinks the cost of living crisis will finally be over.
Also in the news today, Donald.
Trump's ex lawyer Michael Cohen has testified in a Manhattan court that he did submit phony invoices to cover up a hush money payment to adult film actors Stormy Daniels. On Trump's behalf Cohen claimed his duties included threatening to sue people and planting positive stories about the Republican candidate in the press. And officials have hit pause on a public art project called The Portal that connects people in New York and Dublin via a continuous real time video link.
The Portal had become a magnet.
For controversial behavior, including a woman in New York flashing her breasts and some Dubliners holding up swastikas and displaying images of New York's Twin Towers burning. That's all from us for today. Thanks for your company. We'll see you again tomorrow.