TOM CONNELL, HOST: Welcome back. It's a budget that is going to recognise there are cost of living issues whilst realistically doing much to address them. So how should you be feeling about it at home? Joining me live is Assistant Minister to the Prime Minister, Patrick Gorman. Thanks very much for your time. It was the biggest pledge, I think the most noteworthy one for Labor, to get real wages growth going. Quite a few months in, they're going to plummet, essentially, and be way behind inflation for a while.
PATRICK GORMAN, ASSISTANT MINISTER TO THE PRIME MINISTER: Well, rising inflation, both domestically and internationally, is the biggest factor affecting the formulation of this budget. The Treasurer has been very clear about that. What we do hope, over the forward estimates, is that we get to a point, and again the Treasurer has explained this, where inflation, which is going to persist for a little longer than we had expected a few months ago, eventually starts to come off and we start to get real wages heading up again. We're being really open with people Tom. This is a really difficult set of domestic and international economic circumstances, but you see it in the legislation we're putting into the Parliament, we do want to get wages moving again and we do want to act on cost of living and we will see that in the budget tomorrow night as well.
CONNELL: There's not going to be much at all on cost of living there in that budget.
GORMAN: You tell that to the 1.26 million families that are going to benefit from our childcare changes.
CONNELL: From July next year?
GORMAN: From July next year. That's exactly right.
CONNELL: So the cost of living peak that's happening over the next few months, there's nothing for then?
GORMAN: We've got of course, as well, changes to the Pharmaceutical Benefits Scheme, bringing the cost of medicines down from $42.50 down to $30, the biggest cut in the price of PBS medicines in 75 years. And, of course, there will be more measures announced in the budget tomorrow night.
CONNELL: This is a big question. Everyone understands you can't announce spending straight away, that it contributes to inflation, but there's nothing stopping you announcing family, whatever it might be, benefits, payments, whatever they might be, from say July next year. Are we going to see something there in the budget tomorrow?
GORMAN: Well, what you saw indeed this morning was the announcement from Jason Clare around university places, making more Commonwealth supported university places available.
CONNELL: That's not a cost of living announcement.
GORMAN: Well, it is if you are someone who is making that decision as to whether you go to university, where some students indeed do have the choice, where they can be offered a full fee paying place or they're offered a Commonwealth supported place. More people being offered Commonwealth supported places, 20,000 more across the country, including 3000 more in Western Australia, that is a cost of living measures.
CONNELL: Look, sure, they can get more people into uni, but it's not a cost of living fix for a standard family, individual, whatever out there. Are there more measures specifically on cost of living that are going to be announced even if they won't take effect for a few more months?
GORMAN: Well, I'll leave all of the announcements that are not out there publicly for the Treasurer to announce tomorrow night.
CONNELL: I'm just wondering, is there something else for families out there watching right now? Is there something else specifically on cost of living that we're going to get or is that it?
GORMAN: We're really conscious of how much, particularly inflationary pressure and interest rates pressure is putting pressure on working families across Australia and we don't want to pretend that we can fix all of those challenges. Indeed, some of them are because of the domestic circumstances where we've got a range of challenges, but some of them are also from global economic circumstances where as well, we're very conscious that there are some economies in the world who are at serious risk of recession. So all of these factors are going into the very difficult decisions that the government has made over recent times and that will be announced tomorrow.
CONNELL: From what you said before, I felt like there's something else in cost of living there. Is that fair to say?
GORMAN: Well, you will see all of the measures tomorrow. As we said, we have already introduced legislation around making sure we do try and get real wages moving again.
CONNELL: Your bread and butter cost of living, the one change that would be felt before the middle of next year would be slightly cheaper medicines. I mean, that's hardly transformative. For some families that rely on this a lot, particularly if they have got sick children, great for them. But for most people, that's not really much of a change.
GORMAN: Well, again, I would respectfully disagree. I think for people who do have those costs in their day to day lives, for medicines, particularly on their monthly or fortnightly scripts, it does make a real difference. I'm saying 1.26 million families who are going to benefit from cheaper childcare. 180,000 families who will benefit from our expansion of paid parental leave, all of these things.
CONNELL: It's not cost of living. It's not helping right now.
GORMAN: Well, it does help and it also gives people an indication that we are serious about supporting families in some of those things that we know put real pressure on family budgets. Now, I've got to say it, with a trillion dollars of debt left behind from the previous government, yes, the options available to government are less than they may have been in previous budgets.
CONNELL: If you were in charge you would have spent more money on the pandemic. You wanted JobKeeper open for longer and more generous.
GORMAN: Well, we weren't in charge. The former government was in charge, the Liberal government was in charge and all of their decisions and bearing in mind they also built up half of that debt before the Pandemic even hit. I think that's worth reminding viewers as well. The biggest cost that's increasing in the budget is this servicing of liberal national debt.
CONNELL: I want to touch quickly on interest rates. Is Labor totally comfortable with the RBA path? You don't feel like there's an increase of recession if they keep going hard?
GORMAN: We respect the independence of the Reserve Bank.
CONNELL: So down the track, if we do get in trouble, that won't be well, they shouldn't have hyped rates too quickly?
GORMAN: We respect the independence of the Reserve Bank. The Treasurer has announced a review to make sure that the Reserve Bank is able to best meet its objectives and functions. But we respect the independence of the Reserve Bank.
CONNELL: And the NDIS. Is that sustainable as it is?
GORMAN: We know that there's a lot of spending pressure that comes from the rollout of the NDIS, but we also know that there are families who have really struggled to even get into the NDIS. So there are challenges at both ends. I commend the work that Minister Shorten has done in terms of halving the number of people who are waiting for those NDIS packages to be decided upon through appeals processes. And I think of Charlie in my electorate who was a young child who couldn't get into the NDIS. He was eligible, but the process wasn't working for him. And we were able to help him.
CONNELL: A lot of people want it to be reviewed, want the people that need it most to be able to access it, perhaps and not the cost of blowout for assessment. All right, nearly out of time. Just very briefly on the NDIS, is this another area that just seems unsustainable in terms of spending right now to you?
GORMAN: The National Disability Insurance Scheme is a proud Labor achievement. We back the national disability insurance scheme. We know that when it fully meets its objective of ensuring that people with disability can live full meaningful lives.
CONNELL: So hang on, you’re saying the parameters of it right now are sustainable?
GORMAN: What I'm saying is that we back the National Disability Insurance Scheme and the Minister has himself acknowledged that we need to make sure that it is fulfilling its objectives, fulfilling its policy mandate. But also we've seen some significant appointments to the board to make sure that the NDIS can be sustainable for the long term. So it's there for those that need it.
CONNELL: Got to leave it there. Patrick Gorman. Thank you.
GORMAN: Thank you, Tom.