Senator the Hon Katy Gallagher

PATRICIA KARVELAS, HOST: Minister, welcome to the program.

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

KARVELAS: The jobless rate fell to 4.2 per cent in July. Doesn’t that now reduce the prospect of a September rate cut, and perhaps rate cuts for this year?

GALLAGHER: Well, as you know, PK, the Bank makes its own decision based on a whole range of data sets. I mean, I think the thing that jumps out at me from the ABS data released today is that despite everything that's been thrown at us, including a massive inflation challenge, that our labour market has remained relatively strong and we've managed to keep unemployment historically very low, and that's a good outcome for people. More people in jobs, more people working, dealing with cost of living pressures where they can. That's been quite a remarkable achievement over the last 18 months or so.

KARVELAS: There’s no doubt that the low unemployment rate is quite surprising, really, given the situation we’ve been in over the last few years. But doesn’t it also indicate that the trajectory of rate cuts – I know you don’t make the decisions – but if unemployment stays at that rate, that’s a pretty important metric for the Bank to look at and think perhaps the economy is more resilient, and doesn’t need further rate cuts?

GALLAGHER: Well, I think Governor Bullock addressed some of this in her remarks the other day. And you know, that's a great opportunity for journalists to talk directly with the Governor and how the board comes to these decisions. But certainly, looking at the labour market, how it's operating, where demand is, you know, shortages of skills and things like that. All of that data feeds into their consideration, but it isn't the only consideration. They look right across the economy. And, you know, we've had three rate cuts in six months. We know that that's helped households with some of those cost of living pressures they were experiencing. But there's still more work ahead across the economy, which is why next week in our Economic Roundtable, we’ll work through some of those issues that we're thinking about.

KARVELAS: I just want to go to new ABS statistics which show that the gender pay gap is now 11.5 per cent. That’s a pretty encouraging figure, isn’t it?

GALLAGHER: Yeah, it's a great result. I mean, I was really pleased to see that. I happen to be at the Workplace Gender Equality Agency today, where all the workers work on the gender pay gap in particular, and reporting against it. So it was a great opportunity to talk with them. I think, a couple of things out of the release today. One, it's the lowest gender pay gap since records began. So again, showing that we are making progress. But also, that the participation rate for women was up, and also that we can see that by reducing the gender pay gap and addressing some of those wage inequity areas, like in the care economy, that women are now earning more and keeping more of that than when we came to government. And that's been a key focus for us in driving gender equality and addressing some of the inequality that we've seen at work. Including doing things like banning secrecy provisions as part of your employment contract, that's making a difference. More to do, though, and we've got a lot of ideas about how to do that.

KARVELAS: I wonder if we can go to that, before we go to some of the other issues, because the Greens are arguing that early childhood education should be one of the main focuses of next week’s Roundtables. That kind of neatly fits into your broader agenda for women, because women, of course as we know, deal with childcare responsibilities disproportionately. Will it be on the agenda?

GALLAGHER: I think, certainly it was raised – I did an ACT Roundtable yesterday that will feed into the national Roundtable – and it certainly was raised as part of that. Like, how do you deal with some of the underutilisation we see in the labour market? How do we make it easier for people to work the hours they want in the way they want, while they're managing caring responsibilities? So, I have no doubt issues around the provision of early education and care, and how we in particular build the workforce, and make sure that early education and care is safe, will be part of discussions and ideas that are raised. It certainly has been with me.

KARVELAS: And accelerating that move towards universal childcare, is that something you’re thinking about?

GALLAGHER: Well, a couple of things about that.  When we've had, I mean, obviously that has the Prime Minister has that as a priority. But a couple of things that we need to do as we walk down that path is, one, build the workforce. So there's a lot that we need to do there, even if you went out tomorrow and said ‘this is what we're providing,’ you wouldn't have the workforce or the centres to provide that care. And so that's why, in the last budget, we had money set aside to help build more centres, particularly in areas where the market isn't building them. But also, how do we support through wages, an improvement in wages, people considering early education and care as a job? And also within that, how do we support skill development, professional development within that profession? Similar to how we've seen other professions, like nursing, professionalise so that you actually think that you've got a career in that, as opposed to not huge opportunities unless you become trained at a teacher level. So, we've got to do all of those bits of work before you can start saying that you can deliver universality. But that is something that the Prime Minister wants us to work towards, and that's why we've got those focuses on infrastructure and workforce as key components of that.

KARVELAS: Minister, leaked Treasury documents obtained by the ABC have revealed a list of recommended outcomes for the Roundtable next week, including advice to pause the National Construction Code, to cut environmental red tape, and also speed up housing approvals. Are these things that are done and dusted, you’ve agreed to these?

GALLAGHER: Not at all. Obviously, the Treasury and right across government, in fact, we've been getting advice about some of the issues that have been raised through the work that's already been done, some of the discussions that have been had, some of the submissions that have been provided. So, you know, they're definitely – the ones that have been reported in the ABC – are definitely ideas and issues that have been raised, I think, with all of us as we've been developing the Roundtable, and next week obviously we'll concentrate some of the discussion around it. But nothing has been decided. But we, certainly, as Ministers, we are prepared for the discussions and for the ideas that have been raised with us.

KARVELAS: But if it’s an official Treasury document, with ideas to sign off on. That usually means, from my many years of political reporting, that it’s got to a pretty high level. That would be fair to surmise, wouldn’t it?

GALLAGHER: Well, certainly Treasury have been briefing the Treasurer. I've been in part of discussions with the Treasurer and others about ideas that are being formulated and some of the advice that has been coming forward. But I can certainly tell you, and you know, I operate at a pretty high level, that nothing has been pre-determined or pre-decided. Issues have definitely been raised, some of them – definitely the ones that have been reported in the ABC – along with a whole range of others, in fact, and Treasury has been providing advice, as my department has provided me with advice about issues that have been raised with me. Like around procurement, for example, which is one of those issues that's raised fairly constantly with me by the private sector. So I mean, I see it as part of the normal preparation and planning for the Roundtable. And I think it's going to be a really interesting and exciting opportunity to pull everyone together in a room and start talking all of these things through.

KARVELAS: The National Construction Code outlines minimum provisions for safety and accessibility, health, sustainability for buildings, houses, commercial properties. Now, Labor was opposed to the idea of pausing that, have you revisited that? Do you think that it’s worth doing that, so that you can really accelerate new builds?

GALLAGHER: Well, housing has been one of the areas that we have, obviously, discussion around this Roundtable has focused on. I know Claire O'Neill has been working closely with the Treasurer as she goes to implement the commitments that we took to the last election and indeed the ones we were working on before. And people have a range of ideas about what needs to be done to accelerate housing supply. Certainly, the National Construction Code comes up as part of that, as does, as you would expect, planning reform, roles of local government, states and territories. That's all part of the discussion, and I imagine housing will be a key part of those discussions next week.

KARVELAS: So, before the election though, the Coalition wanted to change this. Labor didn’t. If you do, is it fair to just say, yeah we got that one wrong?

GALLAGHER: Well, as I said, nothing has been decided PK, so we need to have the discussions-

KARVELAS: But it sounds like you think it’s a good idea to accelerate all of this. So why not just say yeah, fair cop, we got that one wrong?

GALLAGHER: Well, to be honest, I can't recall what the Coalition's commitment about that was, but I know it has been raised with government as an option that people think should be discussed as part of the productivity Roundtable. And, you know, I've heard the PM say it, I've heard the Treasurer say it. You know, we're not going to tell people what ideas they can and can't raise. We want a good discussion, and if there are areas of consensus for us to think further about what can be done. I mean, this is a rare but genuine opportunity to bring people together and talk about some of the things that, you know, various stakeholders representing different parts of the economy. And I imagine there'll be mixed views around changes to the National Construction Code, as there will be about other areas, but if there are areas of consensus, what can be done to make reforms and to progress and improve productivity across the economy.

KARVELAS: The Prime Minister said there are some things which are ‘low hanging fruit,’ one of my favourite terms, that you can sign off on next week. Would that fit into low hanging fruit?

GALLAGHER: I really can't answer that question for you, PK. I think we need to have the Roundtable. We need to work through what those ideas are, and then have a process that, you know, considers what the outcomes are. I mean, we haven't gone in with, as I said, with a predetermined list of outcomes. And we really need, and most genuinely, want those three days to be full of frank and honest and constructive discussion.

KARVELAS: Okay, so you would know, because you do work at the highest levels. Paint me a picture. You have the three days. At the end what can Australians watching expect? Is it a communique with some broad agreements? Will it be policies ticked off on? What does it look like at the end of those three days?

GALLAGHER: Look, I think there would definitely be, and I would imagine the Treasurer would be wanting to give that, you know, whether he just stands up and does a press conference or something else at the end of those three days to talk about what's been discussed, and what will be progressed, and what's been decided, I would imagine. Again, not having got to next Thursday yet, we'll need to go through the Roundtable, but I would expect the same frankness and openness from the Treasurer that he has shown since he and the PM announced this idea a couple of months ago.

KARVELAS: The other idea is the Albanese Government working on a plan to phase in a road user charge that would begin with a trial of heavy electric vehicles, before being applied to cars. Is that low hanging fruit that’s going to be ticked off on next week?

GALLAGHER: I think I refer to my previous answer, but also the Treasurer, again, has been clear that that is something that we've been talking with states and territories about. Obviously, as we go through this transition from petrol fuelled cars to electric vehicles, we need to talk about how we're going to fund the road system and the infrastructure required across the country. States and territories are actively engaged in this discussion. I know Minister King is actively engaged, as is the Treasurer. And you know, that was something we talked about before the election. It's something that I imagine, again, will be raised at the Roundtable, and we'll see where that goes.

KARVELAS: Minister there’s been a lot of talk about tensions between the Treasurer and the Prime Minister. You do operate at the highest levels, you’re known to be close to both of them. What role do you play in that dynamic?

GALLAGHER: We're a pretty tight three, you know, the three of us. We, in fact, we were just messaging earlier today. You know, it's important I think that the PM, Treasurer and Finance Minister work very closely together considering, regardless of what issue we're talking about, most of them end up, you know, we have some role in deciding or looking at how to fund or looking at how to say no. Between the three of us, we all have a role to play there. So it's an important relationship, and it's a strong relationship. And, you know, we get a lot of things done.

KARVELAS: But if there is like, tensions between them, are you the broker?

GALLAGHER: No, not at all. It's a very equal role across the three of us when we do have those discussions, we all come at things slightly different because we're slightly, you know, we're different people. So we have different perspectives, and we often come with our own portfolios in mind as well. But it's a very constructive relationship, and it's an important relationship that we're all, you know, that we all invest in because of the importance of that working and ensuring the government's success. And we're all deeply involved in making sure that we deliver on those commitments we took to the last campaign and deliver on the ones that we had underway before the election.

KARVELAS: Minister, just finally, Hamas lauding the Government in relation to Palestinian recognition. Hamas has distanced itself from the statement applauding Australia’s decision to recognise Palestinian statehood. But the Opposition says any statement from Hamas should give you pause to reconsider this decision. Will there be any looking back for the Albanese Government?

GALLAGHER: Well, we've made our position. We took that decision, and it was announced on Monday, and it's the right decision for the right reasons. And I would say to the Opposition, I don't know why they would be wanting to promote the propaganda of Hamas, which is exactly what they are doing. We've made our decisions. They've been based on a range of discussions with a number of countries, including the Palestinian authorities, and we've been very clear that, based on our position, Hamas has no role in the future of Palestine. And our position is very clear and very firm, and I would urge the Coalition to stop promoting Hamas propaganda.

KARVELAS: Thank you for joining us. 

GALLAGHER: Thanks very much, PK.