Senator the Hon Katy Gallagher

STEPHANIE FERRIER, HOST: The Federal Government has delivered its mid-year budget update as it prepares to face voters without the economic recovery it hoped for. Finance Minister Katy Gallagher joins us now from Sydney [Canberra]. Thank you Minister for coming on News Breakfast.

SENATOR THE HON KATY GALLAGHER, MINISTER FOR FINANCE: Thanks for having me.

FERRIER: Well, we’ll get to the mid-year budget update in just a moment, but first of all I want to ask you about a couple of international stories that are still developing at the moment. The first of course, the unfolding disaster in Vanuatu. I want to ask whether or not you’ve heard anything further about any Australians that might have been hurt and what’s going on with some of those Australians that are caught up in this disaster?

GALLAGHER: Thanks very much for the question, and obviously our sympathies and hearts go out to the people of Vanuatu, such a beautiful country in our region. And the Australian Government has sent a number of planes over there full of support services and search and rescue equipment and personnel, at the request of the Vanuatu Government. So, that work is underway. Consular assistance is being provided to Australians in Vanuatu and in fact, about 140-odd, almost 150 actually, have returned on assisted travel from Vanuatu to Australia over the last 24 hours or so. And there are people in need, and certainly the consular -- the High Commission over there is working very hard to make sure that any Australians in need are supported. I don’t have any further advice other than that consular assistance is being provided to some Australians who remain in Vanuatu at the moment.

FERRIER: Okay, so we don’t know yet whether or not there are going to be any further assisted flights or any further aid for Vanuatu to help them recover from this disaster?

GALLAGHER: Well obviously, we stand ready to support the people of Vanuatu at the Government of Vanuatu’s request. Really what was sent in the last 24 hours was the first instalment and of course we are ready to provide further assistance as this disaster unfolds. We are neighbours and friends in this region. There’s a lot of close ties between our countries and we of course are going to stand with Vanuatu as it recovers from this disaster.

FERRIER: Now to the decision to open the Australian embassy in Ukraine, we’ve heard that 70 other countries have already done this. What drove Australia to make this decision now?

GALLAGHER: Well, I think we’d always been clear that we wanted to reopen the embassy when the time was right and when the advice to government was that that was safe to do so for all of the people that will be working in that embassy. And the Foreign Minister on her trip to Ukraine has announced that that will be the case, so that is good. We obviously -- it’s much better to have those facilities available in-country and that’s what will happen. So, that’s a very good outcome. But we also have to take the advice of when that is appropriate and make sure that we are keeping Australians safe.

FERRIER: Moving on to the mid-year budget update, the Opposition is accusing you of spin and spend. How confident should voters feel that you have the ability to manage the nation’s finances?

GALLAGHER: Well, I think we’ve shown, Steph -- we’ve delivered two budget surpluses, we’ve found savings, we’ve lowered the debt burden, we’ve lowered the interest on that debt, saving $70 billion in payments from what we inherited when we came to government. The budget over the forward estimates is $200 billion better off than what we inherited, and that’s been hard work and decisions made by this Government. And we’ve had to balance that at a time when we want to provide cost-of-living relief to households and at a time when we need to invest in Medicare and early childhood education and wages for aged care and child care workers. So, we’ve been doing all of that. The MYEFO is obviously a set of a number of decisions and these are tough decisions and we try to get the balance right.

FERRIER: People are really feeling the strain under the cost-of-living crisis. We’ve heard the Treasurer say that if we can afford to do more, if there’s a case, then we will consider that. When will you know if you can afford it?

GALLAGHER: Well, this MYEFO obviously has a number of cost-of-living measures in it. It’s got the HECS reductions for people who have HECS bills, the 20 per cent cut, it’s also got investment in early childhood educators’ wages, again to help them with cost-of-living, we’ve got the energy bill relief floating through, we’ve got the tax cuts floating through as well. But we keep these matters under continued assessment. We’re moving into putting the budget together for March next year, so these are all decisions that remain on our table. What more can we do without adding to the inflation challenge. But I would say Steph, the bigger risk to cost-of-living facing households over the next little while is Peter Dutton’s nuclear power plants scheme, because that will raise bills by about $1200 per household.

FERRIER: I just quickly want to ask you about another issue, which is this change in the controversial visa processing direction. What is the change that’s going to happen with Ministerial Direction 107 for university students coming in?

GALLAGHER: So, this was really -- we took some legislation to the parliament, which the Liberal party didn’t support, which was to manage some of the numbers of international students coming into the country. We’d seen quite substantial growth and we wanted to manage that growth. And the Liberal party didn’t support it. So now, we’ve worked on a way to make sure we can manage that through Ministerial Direction. So, we’ve been pretty up front about it. It’ll prioritise visas for students going to those regional and smaller universities, which is something that we had wanted to do through that legislation. And it will just help us manage those international student numbers, which as we’ve said, have contributed to quite substantial growth in numbers of people coming to Australia.

FERRIER: Finance Minister Katy Gallagher, thank you very much for your time. 

GALLAGHER: Thanks very much, Steph.