SUBJECTS: 2022 Federal Budget; Budget Reply; fuel excise; cost of living; Federal election; Labor’s policy agenda; Labor’s Housing Australia Future Fund; housing affordability; national security; defence; Australia and Indo-Pacific relations; Labor’s Powering Australia Plan; Australia’s relationship with China; passing of Senator Kimberley Kitching.
 
PATRICIA KARVELAS, HOST: Tonight's Budget will set up an election contest over jobs and incomes, with the Government promising the strongest wages growth in a decade on the back of historically low unemployment. Voters will also be wooed with a cost of living package, which will include $250 one-off payments for 10 million Australians, and a cut of at least 10 cents a litre to fuel excise. The Opposition Leader, Anthony Albanese, joins us here in the Parliament House studio. Anthony Albanese, welcome.
 
ANTHONY ALBANESE, LEADER OF THE AUSTRALIAN LABOR PARTY: Good morning, Patricia.
 
KARVELAS: Labor has long argued that decent wages growth is the key to easing cost of living pressures. Are workers finally in line for a pay rise with the Budget forecasting unemployment to fall to 3.75 per cent this year?
 
ALBANESE: Well, Patricia, this Government have promised on 55 occasions different wage forecasts. And on 52 of them, guess what? They've missed. And yet again, in the lead-up to an election, they are saying, 'Oh, your wages will go up, just trust us. Give us a second decade in office'.
 
KARVELAS: But economists agree with them. I spoke to Chris Richardson earlier. And he says, with this unemployment rate being driven so low, we will see wages growth.
 
ALBANESE: Well, what that ignores, of course, is the changing nature of the workforce, is the growth of casualisation, the growth of the gig economy, the growth of people who are outside the system. This is a Government that can't even stand up in the Parliament and say they support people getting the minimum wage. What we know is that in last year's Budget, it forecasted real wage decline over the forward estimates. And in the last year, real wages have fallen by one per cent. And that's before the considerable increase we've seen recently in the costs of food, the costs of petrol, the costs of housing. They are all going up. Everything is going up, except for wages. And this Government said that low wages were a key feature of its economic architecture.
 
KARVELAS: And now, they're telling us that the low unemployment rate will drive up wages, which is basically basic economics.
 
ALBANESE: Except there is massive underemployment, Patricia. The figures hide the fact that people can be working just a few hours a week to get by to get some money. But that's not a sustainable income.
 
KARVELAS: Surely, having a job is the best way to deal with the high cost of living. And there are about 1.2 million more people in work since the height of the COVID pandemic. Doesn't that suggest that the policy settings are right if we are seeing unemployment go down like this?
 
ALBANESE: Well, of course there are more people in work than during a pandemic, when the economy was shut down, Patricia.
 
KARVELAS: We are now dealing with an unemployment rate that we have not seen for decades.
 
ALBANESE: But we are seeing massive underemployment, Patricia.
 
KARVELAS: So, you don't believe the figures?
 
ALBANESE: I believe the figures reflect people working a few hours. What we've seen, for example, even in aged care, Patricia, something that should have full-time employment. What we know is that one of the reasons why the virus spread was that people working two, three, four jobs in multiple facilities. And therefore, if they got COVID, they were spreading it around. It is the changing nature of work that this Government has nothing to say about. And the gig economy, they say they can't do anything about casualisation and increased use of labour hire. Insecure work is the problem here. Insecure work, leading to lower wages, which is actually the Government's policy, that they're quite happy to sit back and see the rise of insecure work.
 
KARVELAS: The Prime Minister says that addressing cost of living pressures will be the focus of tonight's Budget, delivered at 7:30 by the Treasurer. But if all the extra money flushing through the economy pushes up inflation, and real wages end up going backwards, why would Labor support the Budget?
 
ALBANESE: Well, we haven't seen it yet, Patricia.
 
KARVELAS: But you have indicated you won't stand in its way.
 
ALBANESE: We'll have a look at the detail. Well, we've been constructive as a Labor Party under my leadership, Patricia. We have never let the perfect be the enemy of the good. And we know that people are doing it really tough out there. So, if there are measures which give people money, for example, one-off payments, now, we're unlikely to say, 'No, don't give people a one-off payment'. But I'll tell you what. We'll point out that it's probably timed for the election. What we need is a plan for the economy, not a plan to get the Coalition a fourth term in office. And that's all we're seeing from this Government. It's long on politics and short on plans, as they always have been.
 
KARVELAS: The cut to the fuel excise is widely expected to be at least 10 cents a litre. We know there will be a reduction. And it's pretty much confirmed. So, you can't duck this question. Will Labor stand in the way of motorists and cheaper pump prices, regardless of how much It might cost the Budget?
 
ALBANESE: Well, we'll see what the proposal is, Patricia. But I've said, very clearly, that we believe there's a need for cost of living relief. And there's a need for that, though, on a permanent basis. So, we'll be looking as well for something in the Budget, anything, just a sign, that this Government gets the fact that people have been going backwards. And they just don't have a plan for that. And a one-off temporary relief on petrol, like one-off payments, remember the one-off payments on aged care for March and May, time for two payments on a pro rata basis for the election.
 
KARVELAS: Let me pick you up on the one-off payment critique. Does Labor want to bake in a permanent rise, for instance, to all of those that are getting this $250 payment?
 
ALBANESE: We will make our announcement.
 
KARVELAS: But you've criticised the one-off nature.
 
ALBANESE: What we criticise, Patricia, is payments designed to get a Government through an election. What you actually need to do is to deal with cost of living pressures. And this Government don't have a plan for that. And there's a range of ways you can do it. One is by lifting wages. The other is through measures like child care. And we had, in our first Budget, child care relief. The second is in terms of housing. In our second Budget Reply, we had our Housing Australia Future Fund, increasing support for social housing, for affordable housing, for essential workers, for emergency housing for women and children escaping domestic violence. We have looked for structural changes as well. And one of the things that we've looked for is the way that you can increase profits and wages. There's only one way you can do that together. And that's by lifting productivity. And that's what our child care policy was aimed at. That's what our TAFE policy and university policy is aimed at. Our National Reconstruction Fund is all aimed at a plan to lift productivity in the economy.
 
KARVELAS: If you're just tuning in, you're listening to ABC RN Breakfast. Anthony Albanese, the Opposition Leader, is my guest, live in the studio from Parliament House in Canberra. This cut will only be temporary to the fuel excise, meaning whoever wins the election, if you become Prime Minister, you will have the unenviable position of having to lift excise back above 44 cents a litre. If you are Prime Minister, how hard will it be to reintroduce the slug on motorists?
 
ALBANESE: Look, there'll be a range of issues which will be difficult. Because we will inherit a position whereby, we've had a Government that's been treading water for a decade, that hasn't put in place any economic reform of any significance. It doesn't have a social policy agenda. They don't have an energy policy. They've announced 22 of them.
 
KARVELAS: In six months' time, will you be prepared to lift it?
 
ALBANESE: Nothing's been reduced yet, Patricia.
 
KARVELAS: It will be reduced.
 
ALBANESE: Nothing has been reduced yet. We'll wait and see what's in the Budget. One of the things that has happened, though, that's pretty interesting, Patricia, is that there's been a leak from Treasury that the pre-election fiscal outlook will have different projections from that which is in the Budget tonight. Now, if that's the case, are there different projections on wages, has there been a political flavour put into this Budget? And that's something will be monitoring carefully. And I'd say to people, have a look at the pre-election fiscal outlook, which will be done by Treasury, independent of the sort of activity that we usually see, which has led to 55 wage forecasts, 52 of them being wrong.
 
KARVELAS: On the $18 billion in the Budget for more than 140 new infrastructure projects, one analysis shows that the new spending splurge clearly benefits battleground states that the Coalition must win at the election. A separate deep dive shows that just 15 per cent of the projects are on Infrastructure Australia's priority list. If you win the election, would you proceed with any of these projects?
 
ALBANESE: We will wait and see what they are, Patricia.
 
KARVELAS: We know what some of them are. They have been announcing them.
 
ALBANESE: An announcement doesn't mean anything happens with this Government. They consistently do announcements.
 
KARVELAS: The question is about what you will do with them.
 
ALBANESE: Well, you've just said there are many, many projects. And if we had an hour, I could go through them one-by-one.
 
KARVELAS: So, what is your approach, in a macro sense, of this?
 
ALBANESE: Our approach will be that infrastructure is one of the ways that you can boost productivity and boost the economy, but you need to do it appropriately. That's why we funded every single one of the priority projects on the Infrastructure Australia priority list when I was a Minister. That's why we doubled the roads budget, increased the rail budget by 10 times, rebuilt a third of the Interstate Rail Freight Network, did projects that have been talked about forever, like the Redcliffe Rail Line, promised since 1895. It took a Government and myself as Minister, Julia Gillard as Prime Minister, to deliver that.
 
KARVELAS: On China and its security agreement with the Solomon Islands, this is another problem you would inherit if you became Prime Minister and Labor wins the election. What would you do about Beijing building a naval base in the Pacific?
 
ALBANESE: Well, it's a real concern. And one of the things that we would do is to re-engage with the Pacific in a fuller way. The Pacific step-up needs to be more than a slogan. It needs to be backed up by action and respect for what our Pacific Island neighbours are saying, for example, about climate change. We need to be in a position whereby Australia is playing a leading role, along with our allies in the Pacific. Because I'm very concerned about this announcement that appears to have been made in the Solomons. It is a major issue for Australia.
 
KARVELAS: The New Zealand Foreign Minister has flown to Fiji to talk with Pacific leaders about the deal. Should Marise Payne be doing the same?
 
ALBANESE: Well, that's a matter for the Government. But what they should be doing, I'll say this, whether they're doing it physically or virtually, is engaging in full diplomatic efforts with all of our neighbours in the Pacific. But it needs to have happened beforehand as well.
 
KARVELAS: Right now, though?
 
ALBANESE: Right now, they should be fully engaged in this process. Because there is no logical reason why China needs to have a presence in terms of a base in the Solomons.
 
KARVELAS: Anthony Albanese, on Kimberley Kitching, Senators from across the Parliament paid tribute in the condolence motion yesterday. One of your own, Helen Polley, says Kimberley Kitching was bullied. She was bullied due to the strength of her convictions. Another, Deb O'Neill, said that the lack of support had put her health and possibly career at risk. These are direct quotes from your Senators in the Senate yesterday. Your own team says Kimberley Kitching was mistreated on the public record. Why won't you call an inquiry?
 
ALBANESE: Patricia, it's a matter of record that there was an issue with regard to Kimberley Kitching's participation in the Tactics Committee. That's on the record.
 
KARVELAS: But these Senators are talking broader. Why won't you call an inquiry?
 
ALBANESE: Well, an inquiry with what terms of reference?
 
KARVELAS: Well, I'm not going to write them. But you're the Opposition Leader.
 
ALBANESE: No one has been able to suggest.
 
KARVELAS: But you're the Opposition Leader.
 
ALBANESE: No one has been able to suggest anything other than the processes that we have in place. We have an ongoing rolling inquiry, Patricia.
 
KARVELAS: But this rolling inquiry mustn't be working very well if she had been saying to her friends and colleagues that she was being bullied.
 
ALBANESE: Well, it has worked. It has worked, Patricia. And in terms of the processes, we had a process established in 2018. It was updated in 2021. I'm up for any suggested changes that can be made for our processes to make sure that everyone feels that they can fully participate. But the thing that does happen in this building, Patricia, you might have noticed, is that there are differences of opinion, there are passionate views put forward all of the time. And there are also more people who want positions then are available.
 
KARVELAS: Okay.
 
ALBANESE: I promoted Kimberley Kitching and put her on the frontbench. And she stayed there.
 
KARVELAS: All of that is true about the culture of this place. Right? But if it's crossed a line, which is what these people are saying, doesn't there does deserve to be proper scrutiny of this?
 
ALBANESE: Well, there has been scrutiny, Patricia.
 
KARVELAS: There hasn't been an inquiry.
 
ALBANESE: There has been scrutiny of these processes. There has been one suggestion of an inappropriate comment made to Kimberley Kitching, which the person who made the inappropriate comment apologised. I have an open office for anyone to walk in at any time. We have clear and transparent processes that everyone has agreed with. But will everyone in this building always agree?
 
KARVELAS: No.
 
ALBANESE: No.
 
KARVELAS: Okay, so will you talk to Helen Polley and Deb O'Neill? Because they're clearly very concerned.
 
ALBANESE: I speak to Deb O'Neill and Helen Polley. I spoke to them yesterday.
 
KARVELAS: About their concern?
 
ALBANESE: No, they didn't raise any issues with me. And I spoke to them yesterday in the Senate, along with our other Senate colleagues. We had a memorial function for Kimberley Kitching that was very positive last night. And we will recognise Kimberley Kitching's contribution with a condolence motion in the House of Representatives when we sit at 12PM today. It's an opportunity to remember Kimberley Kitching for the fierce advocate that she was, for her views, and to recognise her contribution for the Senate. And to recognise as well, that it is a tragedy that a 52 year old lost their life. But it shouldn't be an opportunity for politicisation of that.
 
KARVELAS: Thank you so much for joining us.
 
ALBANESE: Thanks, Patricia.
 
KARVELAS: That is Labor Leader, Anthony Albanese.
 
ENDS