Senator the Hon Katy Gallagher

GREG JENNETT, HOST: Alright, let’s talk how we got there with these numbers. The Finance Minister, Katy Gallagher is with us now. Katy, good to see you again. So, it’s been too long on the Final Budget Outcome, but it is the cause for some minor celebrations within the Government. A big contribution was $10 billion in under-spends. How much of that simply slides over into the next year and makes it even harder to climb out of the $28 billion hole?

SENATOR THE HON KATY GALLAGHER, MINISTER FOR FINANCE:So, some of it will be moved into the next year and we were clear about that today. But really the story behind the two surpluses is the work that’s gone on over two years. I mean, we’ve found $80 billion worth of savings in our three budgets that we’ve handed down and we’ve returned revenue to the Budget when revenue is coming in. And all of those things matter to the numbers that we delivered today. If we hadn’t been doing those things, we wouldn’t have been having surpluses. So yes, there’s certainly some movement of funding around and some will go into this financial year. But the two surpluses is a story of our responsible economic management.

JENNETT: You said today savings on interest from generating these two surpluses means, quote, we have room to invest in cost-of-living measures. You had more to say on it, too. But if you flip that around, is the opposite true? That is, in deficit, as is currently forecast, you will not have the money available to do cost-of-living relief, like energy bill relief, next year?

GALLAGHER: Well, I think you don’t have a surplus as an end in itself. We’ve focused on making sure we are returning revenue to budget when inflation has been higher than we would have liked for longer than we would have liked, and the Reserve Bank Governor has said that’s helpful. So, at a time when we see inflation higher, it makes sense to look at how we can have surplus budgeting. But the Budget should be used to respond to the economic circumstances of the time –

JENNETT: So, even in deficit – in other words – you wouldn’t hesitate to do things like energy bill relief extension under cost-of-living pressures?

GALLAGHER: Well, the Budget’s there to support the community. And so it’s important that we’ve repaired some of those fiscal buffers since the pandemic so that we are able to respond if we need to, for whatever situation confronts us.

JENNETT: Even if that means deeper deficits than currently forecast?

GALLAGHER: Well, I think – we certainly continue to look for savings. As Jim said today, the deficit for this financial year is $20 billion less than what we inherited. So, we’ve already made some room in that budget compared to what we inherited. But you’ve got to continue to look for savings, make sure you’re investing in quality areas, productive areas, to drive economic growth. Things like that. So, yeah, it’s important to keep an eye on the deficits and look to reduce them where we can – which we’ve done with two surplus budgets. But we’ve also got to be realistic that there will be costs facing the Commonwealth and need to use the Budget to support the economy.

JENNETT: Alright. Let’s move on. There are also further questions today about negative gearing, and the Treasurer did make it clear – if he hadn’t done so before, he certainly did today – that it was me, the Treasurer, me doing my job as Treasurer to seek advice on various proposals in the public domain and also from time to time, in the Senate. So, we learned that he sought it, but it’s not yet complete. What happens next with that advice?

GALLAGHER: Well, look, I’ve been standing next to Jim the last couple of times he stood up. Not in China, when he was there, but I did in Brisbane and today. And I think the point he’s making is that it isn’t unusual or anything out of the ordinary that the Treasurer would be being briefed on housing policy and specific issues within housing that are raised from time to time. That is not unusual at all. And he’s saying that’s me doing my job.

JENNETT: He also said he sought it.

GALLAGHER: Well, he seeks advice on a whole range of things, as you would expect the Treasurer should. I mean, if you ask the Treasurer a question on negative gearing, he should be able to answer that. You would expect that as well.

JENNETT: So, it’s no more than that? It’s simply the ability to answer questions, as opposed to framing prospectively government policy?

GALLAGHER: Well, our policy is clear – and again, he said that today. It’s around supply, it is focused 100 per cent on supply. How do we build more houses, how do we get more properties available for renting, more affordable and social housing, and our Help to Buy scheme – more people out of renting, into home ownership. That is the problem in the economy at the moment in housing. It’s around supply of it and you know that is 100 per cent of our focus. So, I don’t know what the Opposition is going on about, trying to run a scare campaign essentially around our policy, which is focused on supply.

JENNETT: Presumably, you want this advice completed, handed up to the Treasurer. Are you curious at least to see what may be in it?

GALLAGHER: Well, we’ll – you know, I think through the ERC process, we get a range of advice that we consider on housing. Our focus has been 100 per cent on supply. What more do we do to get more supply into the economy as soon as we can to help people with housing? It’s – next to cost-of-living, it would be the number one issue I reckon that comes up with me when I’m out and about. And that’s what we’re focused on, and we’ll continue to be focused on. And if the Senate was more cooperative, we might even get Help to Buy through the Senate.

JENNETT: Alright. Well let me ask you about that, because the Prime Minister – while the cameras were present in the cabinet room today – did foreshadow you will be having a discussion about legislation for next week. So, are those two bills – Help to Buy and Build to Rent – coming back into either chamber next week?

GALLAGHER: Well, we’re focused on trying to get Help to Buy through and Build to Rent. It’s been delayed in the Senate. The Senate delayed for some crazy reason, voted to delay it until November –

JENNETT: But you could bring it into the House. Has that decision been made?

GALLAGHER: Obviously, we’re looking at options around Help to Buy. We are. And the best way to get it through in the quickest time possible, because out of our $32 billion that we’re putting into housing, it’s a reasonably big measure of that. It’s around $5 billion that’s associated with the Help to Buy program. So, we would like it through.

JENNETT: Yeah, so you’re not prepared to sit and wait and work to the Senate’s timeline if you can progress it in other means, a reintroduction?

GALLAGHER: If there’s other ways, we’re considering all options, essentially. But in the Senate, it would be actually very straightforward, which is that we list the Bill and the Bill gets debated and voted upon. And people should take responsibility for their vote. If they’re going to vote no to it, sit on the No side of the chamber. Don’t pretend and play the game we saw last week which was to vote to delay it as a way of avoiding an actual vote on the Bill.

JENNETT: Electoral reform? Will that come in next week?

GALLAGHER: That’s a matter for the Special Minister of State, so you’ll need to ask him about that.

JENNETT: Gambling advertising? I won’t read out the whole list, I promise, but –

GALLAGHER: Well, I’ve just been looking through the list. There’s a long list in the Senate already of quite big pieces of legislation and we accept – I think there’s only 11 Senate sitting days for the rest of this calendar year. The Senate does like to take its time with legislation, so we can see the runway running out. Certainly, by Christmas. So, we’ll work with colleagues across the Senate. Hopefully we don’t see the Liberals and Greens voting together quite as often as we did last week in that alliance, because that prevents us from getting our job done.

JENNETT: It’s certainly been excruciatingly slow to watch of late, I’ll acknowledge that.

GALLAGHER: I’ll pass that on to them.

JENNETT: Thank you. Not a criticism, just an observation. Alright, Middle East. ASIO told us in August when it lifted the terror alert level to Probable, global events such as conflict in the Middle East have resonated and will continue to do so. We saw protests in big cities yesterday, this is part of what ASIO would call a grievance narrative. Does the government conclude that heightened acts of politically motivated violence are more likely because of the escalation there?

GALLAGHER: Well, I think things are obviously very tense in the Middle East at the moment. And you know, we’re a large, multicultural community here in Australia with large populations of people who come from those countries or have family who live there. And so, yeah, I think you can see that rising tension here that we’ve been seeing really for the past year since the conflict started from 7 October onwards.

JENNETT: But is there any expectation that it deteriorates because of, you know, quite unprecedented levels of violence in even the last two days?

GALLAGHER: Well look, I trust both our security agencies and the police who work very hard with you know separate demographics within our community to make sure we’re doing what we can to calm division and to calm that angst and to allow – obviously, people can protest in a country like Australia, but we have the police and others who are managing those and any response to that. I think the job for government is to continue to work on calls for unity and calm. I mean, we are a successful multicultural nation for a reason and you know, we don’t need division and we don’t need stoking it, and it’s I guess no surprise we’ve seen Peter Dutton out again today stoking it with calls around visa status. You know, he’s all about stoking division and raising tensions and I guess from our point of view, we want to calm tensions down –

JENNETT: But that’s in play, isn’t it? To his point, anyone who might have fallen foul of the law with their involvement in demonstrations – by that I mean, displaying Hezbollah photos and flags – could well find themselves under Tony Burke with their visa very much in question?

GALLAGHER: Well, we have very strong and rigorous processes that allow that to occur should that be required. And I would have thought the Leader of the Opposition, in the leadership role that he has, would have faith in those processes as opposed to essentially having a crack at everybody who attended protests and threatening them. We have these systems for a reason. I think political leadership comes when you’re actually trying to bring communities together here in the country, not to divide them and not to incite further tension.

JENNETT: Yeah, fair point, not every person who attended the demonstrations is alleged in any way to have fallen foul of the law. But those investigations are underway. We’ll wrap it up there. Katy Gallagher, thanks so much, good to see you again.