Senator the Hon Katy Gallagher

EMMA REBELLATO, HOST: A parliamentary inquiry into Labor's changes to property tax settings has kicked off as borrowers await the RBA's decision on interest rates today. Finance Minister Katy Gallagher joins us now. Minister, thanks for joining us.

KATY GALLAGHER, MINSTER FOR FINANCE: Thanks for having me on.

REBELLATO: Inflation is such a big factor, as we know, in the RBA's decisions. If this US-Iran deal sticks, when do you expect inflation and prices to fall?

GALLAGHER: So, there is a decision today, as you know, as you just outlined, from the bank. I mean, time will tell around the impact of the agreement that's been reached around the Middle East, and the impact that has on the global economy. We know it's one of the factors that has led to inflation being higher than we'd like, particularly seen through petrol prices. So, there will be a tail to this conflict if the conflict has ended and that ceasefire holds. But working out how that runs through the global economy is something that we'll have to watch over the next little while.

REBELLATO: Just on petrol, the PM's indicated the government's going to decide in coming days over whether to extend the cut to the fuel tax excise. The trucking sector, we know, is worried, tourism too. Would you consider a staged approach to rolling it back?

GALLAGHER: Look, as the PM said, we have this under consideration. I mean, we've seen the price of oil come down even yesterday on the back of the announcement around the ceasefire, petrol certainly in my hometown is a bit below where it was before the war broke out. The fuel excise has helped there, we know it's helped households, so this is something that we keep under active consideration. It's due to expire on the 30th of June. It was always intended that it was temporary, but we keep this under watch.

REBELLATO: Can Australians expect other cost-of-living relief measures? The PM seems to open the door to that.

GALLAGHER: Well, I think we've been clear that we're always focused on how do we deliver cost-of-living help to households. I mean, in all of the decisions we've taken in the Budget, that's really been centre of our thinking, so we've got tax cuts coming in on the first of July. PPL, paid parental leave, is extended to the full six months. We've got our investments in housing, our investments in health, in Medicare, and bulk billing, cheaper medicines. All of that is about how do we provide ongoing cost-of-living help to households in a way that doesn't antagonise or impact on inflation across the economy, we're monitoring that as well. This is something that drives our government, is how do we help households when cost-of-living pressures are real.

REBELLATO: The parliamentary inquiry into the tax changes is under way. We've heard from business groups who are angry, they're saying it will discourage investment and punish business owners. There have been consultations under way. The government's been telling us that. Will there or won't there be any carve-outs? Have you decided?

GALLAGHER: Well, we've been clear that we are engaging with stakeholders, particularly around the area of start-ups, and we were clear about that on Budget night. I think, again, we've made it clear that the legislation that we've introduced into the parliament is, the reforms are the reforms that we want, but, you know, we've got a bit of work to do. There's the committee that's been hearing, and there has been obviously criticism, but there's also been positive support for the changes that we're putting in place. We believe the housing system isn't working for everybody, and that's why we're making these changes. We want young people to get into housing, and we have to deal with the interaction between tax and housing as part of responding to that challenge.

REBELLATO: But have you decided if there will be any carve-outs, any changes to this legislation?

GALLAGHER: Well, as I said in my earlier answer, we've made it clear that we are engaging, and the Treasurer is leading that work for the government around particular impacts, but we've also got legislation in the parliament now, which sets out the framework for the Working Australian Tax Offset, the instant deduction, and the changes to CGT and negative gearing that we want to get through the parliament in the next couple of weeks.

EMMA REBELLATO: Minister, I'd like to ask you about KPMG, regarding the whistleblower scandal. What action is the government taking regarding KPMG and its audit work?

GALLAGHER: So we are very concerned about the allegations that have been made by the whistleblower and KPMG's response to that. We have been actively engaging with them since those allegations were raised. We have notified it as a significant event across government procurement, more broadly across the Commonwealth, and we have reached agreement with KPMG that they don't bid for new work whilst we do a review into the way that they have been operating across the Commonwealth, and that review has been commissioned and will report by the end of September. So I think we're taking this very seriously, and you can see that by the actions that we've determined.

REBELLATO: We're focusing on this breakfast this morning on the mouse plague affecting WA. We’ve heard about the psychological impact, of course, the economic impact too. Has the government been too slow to respond and to help people in those communities?

GALLAGHER: Well, the state and territory governments, in this instance in WA, lead on the response to events like this. I know that Minister Collins is actively engaged, and where appropriate, the Commonwealth will play a role, including through the APVMA, and some of the work they do to make sure that farmers have everything that they need to deal with this plague, but it's primarily led by the state, but obviously when things like this happen, the Commonwealth stands ready to assist.

REBELLATO: Finance Minister Katy Gallagher. Thanks for your time.