RUBY:

So, Paul, you've just come out of the budget lockup. What was it like in there?

PAUL:

Oh, well, it's quite a new experience, really. The lockups these days are actually done in the press gallery and in the bureau. So we were, as it were, locked in The Saturday Paper bureau with a treasury official who took our phones off us and made sure that we could not communicate with the outside world.

RUBY:

Paul Bongiorno is a columnist for The Saturday Paper and this is not his first rodeo.

PAUL:

It’s very different from the first lockup I attended, I can tell you. 37 years ago, Ruby. Probably before you were born, but I won't say anything.

RUBY:

Tell me about that, what was it like 37 years ago?

PAUL:

Well in 1988, Paul Keating was the treasurer. On the morning that he delivered the budget, he got into the mood by listening to Richard Wagner's four last songs from one of Wagner's operas. And I think the version was sung by Jesse Norman. I went out and bought the CD and, I must say, it’s very moving music. I was just trying to work out how many budgets I've actually covered in those 37 years and it's 35, I've missed two. So that's not a bad show-up rate.

RUBY:

35 budgets. Okay, so how does this budget then, as someone who's been around for three and a half decades, how does this compare?

PAUL:

Well, this is a pre-election budget, even though the Treasurer tried to convince us all that it was economics first and politics second. I know a lot of the gurus at the other end of the corridor in the financial press aren't all that impressed. They just look at the budget bottom line and all they see is red and they say, aha, that proves it's all about politics rather than good economic management.

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RUBY:

As the government makes its pitch for re-election, gross public debt is forecast to hit $1 trillion next year and a decade of deficits loom.

But treasurer Jim Chalmers used his budget night pitch to argue that if it wasn’t for Labor, the picture would be worse.

It’s a tough sell at a time when cost of living is biting but, with a record investment in Medicare, energy bill relief and a surprise tax cut for everyone, the government is hoping to secure a second term.

From Schwartz Media, I’m Ruby Jones. This is 7am.

Today, budget veteran Paul Bongiorno, on whether Labor’s election budget will pay off and what’s in it for you.

It’s Wednesday, March 26.

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RUBY:

Paul, let's talk about the budget bottom line. The total gross debt is expected to peak at 37% of GDP in coming years and we're now expecting deficits for the next decade. So why is that, Paul, given that we have had surpluses for the past two budgets? What has changed?

PAUL:

Well, a few things have changed, but I think we should make this point, that Australia, with 37% of the total economic output - that's what GDP means - is amongst the lowest in the world. The United States is 100% of its GDP, as is the United Kingdom. So the Australian economy, even on that measure, is in much better shape than other major democratic economies. But the explanation is that commodity prices have come off, energy prices have risen as a result of the continuing war in Ukraine and also the war in the Middle East, which is disrupting energy supply chains. So all of that is an explanation. The other explanation is that the revenue that our commodity producers were getting in recent years meant that they were paying a lot more tax. Well, this year, the government's not getting the revenue bonanza it was and it has gone into deficit, and a big reason for that is because it knows — and the treasurer made a big point of this in his budget speech and throughout the budget papers — that people are hurting and they do want relief.

Audio excerpt — Jim Chalmers:

“We've made a lot of progress together but we know that many people are still doing it tough. Our plan to rebuild living standards starts with cost of living help and wages growth. It includes more hip pocket help for households.”

PAUL:

And Labor, which spoke about delivering relief at its budget last year but didn't see any reward in the opinion polls for it, knows that it has to have another big go this year because, within six weeks, we'll be going to an election. And I think that's one of the reasons why we've seen the sort of budget that we have.

RUBY:

Can you talk to me a little more about that Paul? I mean, there's no doubt that this is an election budget but what does it say to you about how Labor is positioning itself to voters? What is the overarching message here?

PAUL:

Well, the overarching message is, to quote the Prime Minister, although I know there have been some critics of him for saying this, that Labor's got your backs. This is what they're trying to say. There's a lot of measures that we've already heard about. More bulk billing, more help with electricity bills, cheaper medicines, less student debt, and a big investment into manufacturing in Australia, as well as more homes. The Treasurer really hit the fact that a lot of money will be directed in the area of providing more housing and there'll be more investment in skills and education.

Audio excerpt — Jim Chalmers:

“This is a responsible budget with five main priorities. Helping with the cost of living, strengthening Medicare, building more homes, investing in every stage of education and making our economy stronger, more productive, and more resilient.”

PAUL:

But what we did see really as the surprise centrepiece of the budget tonight was Jim Chalmers pulled a scrawny rabbit out of the hat.

Audio excerpt — Jim Chalmers:

“These additional tax cuts are modest but they will make a difference. The average earner will have an extra $536 in their pocket each year when they're fully implemented. Combined with our first round of tax cuts this is $2,190 and the average total tax cut will be $2,548 or about $50 a week.”

PAUL:

So that's adding the $5 to the tax cuts you got in July, which is a very clever political way, in my view, of upgrading and updating the tax cuts as something new.

RUBY:

Okay. So we have this small tax cut. Let's talk about the spends though. A big focus of that is healthcare, we're seeing $8.5 billion for bulk billing incentives. There's also this plan to reduce the cost of scripts under the PBS. There's a women's healthcare package as well. So tell me more about the details of the health spending and why you think it is that Labor is focusing on this.

PAUL:

Well, Labor is focusing on that there for various reasons, namely that health is an issue that voters have identified as something that is impacting on their wellbeing in a very big way.

Audio excerpt — Jim Chalmers:

“Tonight we are proud to make the single biggest commitment to Medicare since its creation. A record $8.5 billion to lift bulk billing rates and build our health workforce. Because of this investment, nine out of 10 GP visits should be fully bulk billed by the end of the decade.”

PAUL:

The calculation politically, the hard-edged calculation is, that Peter Dutton, when he was Tony Abbott's health minister, launched a full frontal attack on bulk billing by wanting to have a co-payment. Now, when the Senate at the time refused to play ball with that, what the Abbott government followed by then the Turnbull and Morrison governments did, they froze the Medicare rebate paid to doctors, and what we've seen over those intervening years, instead of a co-payment imposed by the government, they've forced the doctors to charge when you visit them. In other words, it was still the co-payment by stealth.

Now the $8 billion that's going back into raising the rebate for doctors, plus the incentive for them to bulk bill, is hoping to readdress that but it also gives a line of political attack of the government on Peter Dutton because of his record in this area.

RUBY:

Coming up after the break - is this budget enough to get Labor re-elected?

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RUBY:

Paul, this is Jim Chalmers fourth budget and, depending partly on how this lands, it could be his last. And I think, over the years, it's fair to say there have been a lot of small changes, a lot of little mechanisms that might make things cheaper for households, but there's never been a big centrepiece policy, something like making childcare universal, for example, or putting dental into Medicare. So, when you look at the last few budgets, what does it tell you about the sort of treasurer that you think Jim Chalmers is showing himself to be?

PAUL:

Yeah, well, I think that he would take great exception to what you've just said. And by the way, what you have just said is not unusual. There are many critics, both from the left or the right, that make similar comments.

RUBY:

It just seems like there's lots of long lists of small things rather than tent pole policies.

PAUL:

Well, for example, on childcare, the government is now moving to three-day free childcare for everybody, you know. So sure, that's not five days a week, and a lot of working parents point out that that still leaves them with a terrible gap, but it's a hell of a lot more than what was on offer before. The other point to be made, too, like, for example, the government is spending billions now on raising the salaries and the wages of care workers. Now that in a real sense will be a signature policy as well. I also myself don't have a lot of sympathy for the criticism in the sense that Medicare is a major, big ticket item and $8 billion more — that's on top of what's already being spent — has been put into what is in a legacy sense an historic, you know, Labor policy. But when you come to Medicare dental, how much would dental Medicare cost? Now, there are a lot of arguments to say whatever it costs, it's going to save you billions more because of the relationship between dental and overall health. And I guess all budgets come down to choices, and this is a choice that, the current government and treasurer at this stage aren't prepared to make. So look, Chalmers, I think, has established a reputation already as a competent treasurer. Should we be demanding more of him as a competent treasurer? Well, he would say, as he in fact did today at the news conference inside the lockup, that we've laid the foundations, elect us again and we'll do even more soon. So, whether voters buy that, we won't have to wait very long to find out.

RUBY:

And so as we've said, Paul, this is ultimately an election budget. So is it enough to get Labor re-elected?

PAUL:

Look, Ruby, I think any pre-election pitch does depend, not only on what one side offers, in this case, the Labor government, but what the alternative side will offer to entice voters to go for it. Now, as I moved around the lockup this afternoon after doing my homework so I could talk to you, talking to other journos and lobbyists, they were saying that Peter Dutton, they think, might have left it a bit too late. What has he put out there as a real alternative to what the government is doing? All he's been left to say, and I'm sure he'll say this on Thursday night, is, me too, me too on this. And it's as if Dutton was convinced that Albanese and his government were completely on the slide and he didn't have to do much but stand to the side and cheer as they self-destructed.

Well, what we've seen, especially since the beginning of this year, far from self- destructing. The Labor government is fighting back.

RUBY:

Paul, thank you so much for your time.

PAUL:

Thank you, Ruby. Bye.

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RUBY:

Also in the news today...

The Coalition will not support the tax cuts announced in last night’s budget, the shadow treasurer Angus Taylor has revealed.

Taylor called the cuts “an election bribe by a weak prime minister” and a “cruel hoax” that will do little to improve the standard of living.

The opposition has previously claimed that taxes would be lower under a Peter Dutton led government but has not yet revealed its tax policy.

Peter Dutton’s budget-in-reply speech will be delivered on Thursday night.

And,

Brisbane is set to get a new 63,000 seat stadium for the 2032 Olympic and Paralympic Games. The stadium will be built at Victoria Park, a popular, inner-city public park.

The Queensland Premier David Crisafulli unveiled the plans for the venue yesterday, despite promising multiple times during the election campaign that he would not be building a new stadium for the games.

I’m Ruby Jones, this is 7am. Thanks for listening.

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