Topics: Budget 2022
30/03/2022
6:30AM AWST
Lisa: Treasurer Josh Frydenberg handed down the budget last night and now joining us to help us sort through it is Federal Finance Minister Simon Birmingham. Good morning.
Clairsy: Morning, Simon.
Simon Birmingham: Good morning, guys. Great to be with you.
Lisa: Lovely of you to join us. The first thing really that I think is on everyone’s mind at the moment is how the budget is going to affect cost of living. Cost of living obviously is an issue at every budget, but I feel like we’re in a time where everything seems to be affected at the same time – petrol, food, power. There really is a bit of a crisis. So in layman’s terms, what’s in this budget for everyday people when it comes to the cost of living?
Simon Birmingham: Yeah, look, it’s a tough time having been battered for the last couple of years by COVID 19. The world now faces the war in Ukraine. Russia’s terrible actions there. And they’ve caused a big spike in oil prices. Now, that’s not forecast to last forever, but it does mean that people are feeling the pinch with fuel prices going up a lot. And so the more you’ve got to run around to work, to school, to the shops in regional areas, the more it’s hurting. So in this budget we’re doing, as we did with COVID, targeted temporary relief knowing that those spikes won’t be with us forever. But we’re cutting the fuel excise by $0.22 a litre for the next six months. That’s going to save people about 15 bucks every time they fill their car up. So it’s a real saving to everybody who’s a road user. But we’re also making sure that to deal with these temporary pressures, there are some additional payments being made to our pensioners, carers, veterans, those on income support, as well as to low and middle income earners in topping up the tax offset that they will receive at the start of the new financial year and taking that up to a potential 1500 dollars tax offset per person.
Clairsy: Okay, Simon, people are always going to be cynical in some way, shape or form, not just the opposition with a pre-election budget. So if there are handouts or the petrol, I mean, it’s a tricky thing to do and make everyone happy all the time. Isn’t it? I mean impossible?
Simon Birmingham: Look, it is. And I mean, I hear people in the morning after the budget, some saying we spent too much, some saying it’s not enough. What we’ve tried to do, I guess, is find the Goldilocks space of walking through the middle. That with the really strong economy we’ve got at present that’s recovered from COVID far better than almost anywhere else in the world. The strong employment numbers, unemployment pushing down to the lowest levels in 50 years. We’ve seen some big improvements in the in the budget position. Most of that we’ve done the right and responsible thing and we’re making sure the debt will be lower in the future. Deficits will be lower in the future. That’s what people expect a Liberal government to do. But we also, in recognising the pain people are feeling right now because of these events internationally, providing this support in terms of petrol prices, in terms of payments to low and middle fixed income earners. There’s also things there that are making medicines cheaper in the future, particularly for 2.4 million Australians who use medicines the most, but also our long term economic plan that continues to invest record sums in infrastructure into our defence of the nation, support for more hiring of apprentices and more investment in skills, and particularly a focus on small businesses and helping them to lift their investment in new technologies to make them more effective and efficient in the future.
Lisa: Another thing that’s been a big issue, no doubt exacerbated by the way the pandemic has affected people returning home and so on, housing and availability and being able to save up a deposit and so on. How’s housing being handled in the budget?
Simon Birmingham: So look we’ve got real support for housing in terms of $2 billion extra that we’re providing for affordable housing through the National Housing Finance and Investment Corporation. That’s about supporting innovative ways of getting affordable housing to those who need it most, but then, even more importantly, to actually get people into their own home. We’re supporting more first home owners in the country. Our government introduced what’s called the First Home Guarantee. It’s about making sure you don’t have to save the whole 20% deposit. That if a bank approves you for a loan when you’ve only got 5% of the deposit or in some cases even two and a half per cent, you can stop paying rent, get into your home, start paying off the loan sooner and that’s going to provide even more opportunities with a doubling of places to 50,000 per annum in that scheme to get more first home owners in. We did a review of retirement savings in the last couple of years and it showed that as well as the amount of money you’ve got in super. The one other thing that makes the biggest difference to your retirement is owning your own home. And we’re really proud that as a government, we’ve seen an increase in first home ownership again, and we want to keep that going.
Clairsy: Simon we know here in the West we’re a bit different from the way we dealt with COVID, to the riches that come out of our land here, which helps with the surplus. But how do you do that? How do you work? And, you know, through the numbers with the custom building things for different regions in different areas around the country and Western Australia in particular.
Simon Birmingham: Yeah, look, it’s a really careful balancing act to make sure that we keep the debt levels as low as possible. And it’s why we’ve, we have in this budget really focussed on bringing those future deficits down and halving them compared with what had previously been forecast. It’s also we’re investing in, in targeted infrastructure that is really necessary, like the Comprehensive Cancer Centre in Perth that the PM recently announced. It’s an important investment in the social services that people support, the health care systems they want. But investing in our national security, such as the $4.3 billion large vessel dry berth in WA, that’s going to help our Navy in their operations out of the West, but also help shipbuilding and commercial ship building to grow in in Perth and WA. And in this Budget more support for further infrastructure upgrades in in the Pilbara. Such a wealth generator for our nation. But this is really geared about making sure that in new energy areas like hydrogen development in the future in achieving net zero emissions, that we’re backing the capacity of our infrastructure to meet those new opportunities of the future, too.
Lisa: All right. Well, we’ll probably have to let you go in a moment. But before you do, Simon, I don’t have to tell you that budgets bring out the most cynical of cynics, especially election time budgets. What do you say to people who say, oh, this is just an attempt at vote grabbing ahead of the election? How do we know the government will follow through?
Simon Birmingham: Look, what I’d say to them is partly judge us on our track record. That we have delivered a strong economy that is faster growing than much of the rest of the world. That’s got unemployment to 50 year lows. We’ve cut income taxes twice already and we’ve got already legislated further income tax cuts in the next term of parliament. That in this case, we’ve shown a balanced and a responsible approach. Bringing, you know, taking most of the dividends of a stronger economy and applying them to lower debt and lower deficits in the future, some of it to helping people with cost of living pressures today, but again, in a temporary and targeted way that responds to needs and then really investing further in small business, in manufacturing, in agriculture, in research and commercialisation to keep that economic growth going into the future.
Clairsy: Well, busy time, busy day for you out there. And we know that the PM is busy with Josh selling the budget today. So on your way out, you can tell us the election date. He’s not listening, Simon. Can you just drop it for us?
Simon Birmingham: It will be May 14, give or take a week.
Clairsy: Hey, well done.
Lisa: Give or take a week.
Lisa: I’m tipping this weekend for an announcement, but we will see. Simon, thank you for sparing us some time on a very busy day. We appreciate it.
Simon Birmingham: Thanks, guys. My pleasure.