From the newsrooms of the Sydney Morning Herald and The Age, this is inside politics. I'm Jacqueline Maley, it's Friday, May 10th. The federal government will hand down its third budget next Tuesday, May 14th. Treasurer Jim Chalmers has promised the budget will be about cost of living relief and also reform.

From the newsrooms of the Sydney Morning Herald and The Age, this is inside politics. I'm Jacqueline Maley, it's Friday, May 10th. The federal government will hand down its third budget next Tuesday, May 14th. Treasurer Jim Chalmers has promised the budget will be about cost of living relief and also reform.

It'll be about relieving cost of living pressures in the here and now, and positioning our economy to take maximum advantage of of these opportunities into the future.

It'll be about relieving cost of living pressures in the here and now, and positioning our economy to take maximum advantage of of these opportunities into the future.

The treasurer says people should also expect ambitious investment from the government on housing supply.

The treasurer says people should also expect ambitious investment from the government on housing supply.

Housing will be front and centre in the budget. It's going to be a big part of what people can expect to hear on Tuesday night. That's because we don't have enough homes. We need to build more homes for more people, and that requires a bunch of things. It requires more Commonwealth investment. We will do our bit.

Housing will be front and centre in the budget. It's going to be a big part of what people can expect to hear on Tuesday night. That's because we don't have enough homes. We need to build more homes for more people, and that requires a bunch of things. It requires more Commonwealth investment. We will do our bit.

So today, in a special episode, chief political correspondent David Crowe and senior economics correspondent Shane Wright speak to the treasurer, Jim Chalmers, in Canberra. They'll cover migration, housing pressures, the future Made in Australia policy and the Treasurer's general focus ahead of next week's budget.

So today, in a special episode, chief political correspondent David Crowe and senior economics correspondent Shane Wright speak to the treasurer, Jim Chalmers, in Canberra. They'll cover migration, housing pressures, the future Made in Australia policy and the Treasurer's general focus ahead of next week's budget.

Good I treasure and welcome to Inside Politics.

Good I treasure and welcome to Inside Politics.

Thanks for having me guys. Shane and David, nice to see you. Great to have.

Thanks for having me guys. Shane and David, nice to see you. Great to have.

You. And thanks very much. First question really is about comparing this budget to last one. Last year you announced 14.6 billion in cost of living relief for households. Will you have to make that kind of help more modest this time around, because you cannot afford to put upward pressure on inflation?

You. And thanks very much. First question really is about comparing this budget to last one. Last year you announced 14.6 billion in cost of living relief for households. Will you have to make that kind of help more modest this time around, because you cannot afford to put upward pressure on inflation?

Well, the foundation stone of the cost of living help in the budget is $107 billion worth of tax cuts for every taxpayer. And so really, the main difference between last year and this year is we've got quite substantial help for 13.6 million Australians announced and built into the budget, and people will receive that from July. I think the average tax cut will be about $36 a week. So that's the main difference. But there will be additional cost of living help as well. For the final figures around that, all of your viewers and listeners will have to tune in on on Tuesday, but we've said we've been prepared to do a bit more, but to do it in a responsible way and in a meaningful way, that helps with the inflation challenge rather than makes it worse.

Well, the foundation stone of the cost of living help in the budget is $107 billion worth of tax cuts for every taxpayer. And so really, the main difference between last year and this year is we've got quite substantial help for 13.6 million Australians announced and built into the budget, and people will receive that from July. I think the average tax cut will be about $36 a week. So that's the main difference. But there will be additional cost of living help as well. For the final figures around that, all of your viewers and listeners will have to tune in on on Tuesday, but we've said we've been prepared to do a bit more, but to do it in a responsible way and in a meaningful way, that helps with the inflation challenge rather than makes it worse.

And so Future Made in Australia is going to be another big theme here. And we've heard a lot of talk about critical minerals, about renewable energy projects and so forth. Now, you've signalled some tax incentives as part of this agenda. Um, how broad will those tax incentives be? Are they restricted to specific industries or do they go beyond that?

And so Future Made in Australia is going to be another big theme here. And we've heard a lot of talk about critical minerals, about renewable energy projects and so forth. Now, you've signalled some tax incentives as part of this agenda. Um, how broad will those tax incentives be? Are they restricted to specific industries or do they go beyond that?

Well, there'll be a combination of measures in the budget. Um, you know, this opportunity doesn't present itself in one way. And that means that the the levers that we pull are not identical, you know, right across this agenda. You know, this agenda is, is all about making ourselves an indispensable part of the global net zero transformation. It's about grabbing the vast industrial and economic opportunities, uh, of of net zero. Uh, and so within those opportunities and you've mentioned a couple of them in your question, uh, different levers are more or less appropriate. And so people should expect to see a package which is coherent. Uh, but, uh, incentives, which are quite bespoke depending on the type of opportunity we're, we're, we're seeking to maximise.

Well, there'll be a combination of measures in the budget. Um, you know, this opportunity doesn't present itself in one way. And that means that the the levers that we pull are not identical, you know, right across this agenda. You know, this agenda is, is all about making ourselves an indispensable part of the global net zero transformation. It's about grabbing the vast industrial and economic opportunities, uh, of of net zero. Uh, and so within those opportunities and you've mentioned a couple of them in your question, uh, different levers are more or less appropriate. And so people should expect to see a package which is coherent. Uh, but, uh, incentives, which are quite bespoke depending on the type of opportunity we're, we're, we're seeking to maximise.

Why not just cut company tax instead?

Why not just cut company tax instead?

That would be quite a blunt way of going about it. Quite an expensive way. Um, and what we're trying to do here is we're trying to attract more, uh, private investment, uh, at the intersection of industry, energy, resources, skills. Uh, and those are our big national advantages. That's why we feel optimistic and confident about the future. And the best way to incentivize the private investment that we need, which is the overwhelming focus of the package, uh, is to focus on where we think those opportunities will be most fruitful.

That would be quite a blunt way of going about it. Quite an expensive way. Um, and what we're trying to do here is we're trying to attract more, uh, private investment, uh, at the intersection of industry, energy, resources, skills. Uh, and those are our big national advantages. That's why we feel optimistic and confident about the future. And the best way to incentivize the private investment that we need, which is the overwhelming focus of the package, uh, is to focus on where we think those opportunities will be most fruitful.

So the budget every year outlines the liabilities, the contingent liabilities of what the government might face. That includes, uh, a liability in case a piece of Australian space junk hits anyone on the planet. We have a liability if that happens to us.

So the budget every year outlines the liabilities, the contingent liabilities of what the government might face. That includes, uh, a liability in case a piece of Australian space junk hits anyone on the planet. We have a liability if that happens to us.

Has that happened to you, Shane?

Has that happened to you, Shane?

Not lately. But the important thing in this space is you can't guarantee any of the businesses that you support. All of them will succeed. Does that mean you will have to allow for the possibility that the government will lose money, that taxpayers will lose money, and will that be part of the budget? Well, first.

Not lately. But the important thing in this space is you can't guarantee any of the businesses that you support. All of them will succeed. Does that mean you will have to allow for the possibility that the government will lose money, that taxpayers will lose money, and will that be part of the budget? Well, first.

Of all, I mean, that's not unusual or unprecedented. I mean, we wouldn't be the first government, uh, to to co-invest in the economy. And so we will account for that and we'll treat, treat that the usual way. Uh, but also and this goes a bit to, to David's question a moment ago, you know, we don't people shouldn't assume that what we're trying to do here with public investment is replace private investment. We're trying to incentivize we're trying to attract it. Uh, and that won't necessarily always be with grants or equity. You know, there are other ways that we can support, uh, the future growth of our economy. And I know that this is, uh, uh, you know, to take the most expansive view of this, and you would know this, Shane, and you would know it, too. David, you think about the way that our economy has unfolded since Federation and Paul Keating talks about this. The first economy was colonial and agricultural. The second one was industrial behind the tariff wall. The third one was the big opening up in the 80s and 90s. This is really about the fourth growth model for Australia, and it recognizes that our future will be powered by cleaner and cheaper energy. Uh, there is economic and industrial opportunity in that for us, in fact, a golden opportunity for Australia. And if we don't play the cards that we have been dealt, uh, that would be an egregious breach, in my view, of our generational responsibilities. But if you.

Of all, I mean, that's not unusual or unprecedented. I mean, we wouldn't be the first government, uh, to to co-invest in the economy. And so we will account for that and we'll treat, treat that the usual way. Uh, but also and this goes a bit to, to David's question a moment ago, you know, we don't people shouldn't assume that what we're trying to do here with public investment is replace private investment. We're trying to incentivize we're trying to attract it. Uh, and that won't necessarily always be with grants or equity. You know, there are other ways that we can support, uh, the future growth of our economy. And I know that this is, uh, uh, you know, to take the most expansive view of this, and you would know this, Shane, and you would know it, too. David, you think about the way that our economy has unfolded since Federation and Paul Keating talks about this. The first economy was colonial and agricultural. The second one was industrial behind the tariff wall. The third one was the big opening up in the 80s and 90s. This is really about the fourth growth model for Australia, and it recognizes that our future will be powered by cleaner and cheaper energy. Uh, there is economic and industrial opportunity in that for us, in fact, a golden opportunity for Australia. And if we don't play the cards that we have been dealt, uh, that would be an egregious breach, in my view, of our generational responsibilities. But if you.

Offer things like loans, um, or take equity, in some cases, that may not work out. Do you acknowledge that some of those loans may end up failing? And there's a logical question, which is if they do fail, who takes the blame? Is that on you, or is that on some other government agency? Well, two.

Offer things like loans, um, or take equity, in some cases, that may not work out. Do you acknowledge that some of those loans may end up failing? And there's a logical question, which is if they do fail, who takes the blame? Is that on you, or is that on some other government agency? Well, two.

Things about that. I mean, the first part is to is to go back to my answer to Shane, which is that's been a feature of, of budgeting for a long time. That predates our approach. Secondly, what we've tried to do with these co-investment funds is make sure that they've got the best possible people, the best possible evidence based decision making, so that we're government is taking a stake or making a co-investment of any kind, that it is well informed. Uh, and that will be the approach, you'll see, uh, in the various ways that we've put together, uh, the public part, which is only a sliver of the equation, the public part of some of this investment.

Things about that. I mean, the first part is to is to go back to my answer to Shane, which is that's been a feature of, of budgeting for a long time. That predates our approach. Secondly, what we've tried to do with these co-investment funds is make sure that they've got the best possible people, the best possible evidence based decision making, so that we're government is taking a stake or making a co-investment of any kind, that it is well informed. Uh, and that will be the approach, you'll see, uh, in the various ways that we've put together, uh, the public part, which is only a sliver of the equation, the public part of some of this investment.

When making these kind of loans available to companies and putting taxpayer funds at at risk, shouldn't taxpayers be able to see more information about how those investments are made so they can see official advice that gives them a level of assurance that the deal stacks up?

When making these kind of loans available to companies and putting taxpayer funds at at risk, shouldn't taxpayers be able to see more information about how those investments are made so they can see official advice that gives them a level of assurance that the deal stacks up?

What I intend to do in the budget, uh, is to make it even clearer. Uh, the kind of frameworks that we will be relying on as we consult on and finalize the policies that will be announced in the budget. You know, I've already indicated publicly to help form people's consideration about this, the sorts of considerations that we will apply, uh, and why, uh, but the combination of the future Made in Australia Act and some of the other detailed framework that I release, uh, next week. And after that, we'll go to this question. You know, we do want people to understand the nature of the opportunity, but also to assure people that there is a rigour and a robustness, uh, about how we're going about this. It's not some kind of free for all of taxpayer dollars, very rigorous, very robust, guided by legislation and frameworks, uh, heavy involvement from Treasury Department, the Finance Department, in combination with Ed Husic's Department and Chris Bowen's department and the rest to make sure that we get value for money here.

What I intend to do in the budget, uh, is to make it even clearer. Uh, the kind of frameworks that we will be relying on as we consult on and finalize the policies that will be announced in the budget. You know, I've already indicated publicly to help form people's consideration about this, the sorts of considerations that we will apply, uh, and why, uh, but the combination of the future Made in Australia Act and some of the other detailed framework that I release, uh, next week. And after that, we'll go to this question. You know, we do want people to understand the nature of the opportunity, but also to assure people that there is a rigour and a robustness, uh, about how we're going about this. It's not some kind of free for all of taxpayer dollars, very rigorous, very robust, guided by legislation and frameworks, uh, heavy involvement from Treasury Department, the Finance Department, in combination with Ed Husic's Department and Chris Bowen's department and the rest to make sure that we get value for money here.

I just want to circle back a bit to, to tax, um, because the decision to rejig the tax, uh, stage three tax cut, very big political argument as well as ringing a bell. Yeah, a big economic one for you as well. Is this the shape of the personal tax system that you think you'll take to the next election? Is this the way that you you think the tax system should be set for the next two, three, four, five years?

I just want to circle back a bit to, to tax, um, because the decision to rejig the tax, uh, stage three tax cut, very big political argument as well as ringing a bell. Yeah, a big economic one for you as well. Is this the shape of the personal tax system that you think you'll take to the next election? Is this the way that you you think the tax system should be set for the next two, three, four, five years?

I certainly we haven't been contemplating another, uh, round of, uh, personal income tax reform to come so closely on the heels of this round. You know, we've only just legislated, uh, these changes and they'll flow from, from July unless something dramatically changes. I think people should expect to see that these are the rates and thresholds that will apply at election time. Uh, and we did this for a very good reason. And we've talked about this on a number of occasions before. Uh, we think this is a better way to return bracket creep. We think it's a good way to ensure that people earn more and keep more of what they earn. It's better for labor supply, better for women, better for young people, better for middle Australia. Uh, so we're quite proud of the changes that we've made. And our focus is on rolling these out rather than on the next round.

I certainly we haven't been contemplating another, uh, round of, uh, personal income tax reform to come so closely on the heels of this round. You know, we've only just legislated, uh, these changes and they'll flow from, from July unless something dramatically changes. I think people should expect to see that these are the rates and thresholds that will apply at election time. Uh, and we did this for a very good reason. And we've talked about this on a number of occasions before. Uh, we think this is a better way to return bracket creep. We think it's a good way to ensure that people earn more and keep more of what they earn. It's better for labor supply, better for women, better for young people, better for middle Australia. Uh, so we're quite proud of the changes that we've made. And our focus is on rolling these out rather than on the next round.

Yet I was going to say going to bracket creep. Over 126,000 have been waiting for some relief from bracket creep since Scott Morrison announced this whole program years ago. Why don't you go back to Malcolm Fraser and Phillip Lynch and say, right, let's index thresholds with inflation. That would ease bracket creep very quickly for a lot of people.

Yet I was going to say going to bracket creep. Over 126,000 have been waiting for some relief from bracket creep since Scott Morrison announced this whole program years ago. Why don't you go back to Malcolm Fraser and Phillip Lynch and say, right, let's index thresholds with inflation. That would ease bracket creep very quickly for a lot of people.

Well, indexation is not a common feature of our tax system. There are other rates and thresholds which aren't which aren't indexed in that way. Governments from time to time, uh, we'll want to change rates and thresholds. Uh, we're reforming the income tax system here. We're cutting two rates and we're lifting two thresholds, I think, from memory. And you'll correct me if I'm wrong. Uh, the last time the top threshold was lifted was also by labor in about 2008, uh, implementing the changes announced before that election. And so there is tax reform here. We are returning bracket creep. We're doing it in a much, much better way, uh, than would have occurred had we not changed the tax cuts at the start of the year.

Well, indexation is not a common feature of our tax system. There are other rates and thresholds which aren't which aren't indexed in that way. Governments from time to time, uh, we'll want to change rates and thresholds. Uh, we're reforming the income tax system here. We're cutting two rates and we're lifting two thresholds, I think, from memory. And you'll correct me if I'm wrong. Uh, the last time the top threshold was lifted was also by labor in about 2008, uh, implementing the changes announced before that election. And so there is tax reform here. We are returning bracket creep. We're doing it in a much, much better way, uh, than would have occurred had we not changed the tax cuts at the start of the year.

Your answer a moment ago suggested that we shouldn't be expecting any further change on personal income tax before the next election, but we do know that the coalition is going to tweak its personal tax policy because they complained, but then accepted the stage three changes. Shouldn't you leave yourself a little bit of leeway to respond to whatever tax change they may put up?

Your answer a moment ago suggested that we shouldn't be expecting any further change on personal income tax before the next election, but we do know that the coalition is going to tweak its personal tax policy because they complained, but then accepted the stage three changes. Shouldn't you leave yourself a little bit of leeway to respond to whatever tax change they may put up?

We'll always try and do the right thing. Uh, by by people, you know, conscious of the budget, conscious, conscious of cost, of living pressures and the needs of the economy now and into the future. So that's that's our standing position on that. The reason I'm smiling, David, is because it's not clear to me what the coalition. In the same interview on Sunday, Susan Lee said both things that they were going to change it. And then she said, I didn't say they were going to change the tax system. It would cost about $40 billion, uh, to implement the, uh, higher income part of the old stage three. The opposition says that they're interested in doing that. They should tell us on Thursday night in the budget reply how they'll pay for that.

We'll always try and do the right thing. Uh, by by people, you know, conscious of the budget, conscious, conscious of cost, of living pressures and the needs of the economy now and into the future. So that's that's our standing position on that. The reason I'm smiling, David, is because it's not clear to me what the coalition. In the same interview on Sunday, Susan Lee said both things that they were going to change it. And then she said, I didn't say they were going to change the tax system. It would cost about $40 billion, uh, to implement the, uh, higher income part of the old stage three. The opposition says that they're interested in doing that. They should tell us on Thursday night in the budget reply how they'll pay for that.

The Sydney Morning Herald and The Age are releasing new episodes of the highly successful podcast Bondi Badlands. Plenty has happened since the first season over two years ago. Two men have been sent to prison, one for the manslaughter of gifted mathematician Scott Johnson in 1988, another for the murder of martial artist Raymond Keene. Listen to exclusive interviews with Scott Johnson's brother Steve and findings from the world's first gay hate inquiry last year. Bondi Badlands wherever you get your podcasts.

The Sydney Morning Herald and The Age are releasing new episodes of the highly successful podcast Bondi Badlands. Plenty has happened since the first season over two years ago. Two men have been sent to prison, one for the manslaughter of gifted mathematician Scott Johnson in 1988, another for the murder of martial artist Raymond Keene. Listen to exclusive interviews with Scott Johnson's brother Steve and findings from the world's first gay hate inquiry last year. Bondi Badlands wherever you get your podcasts.

On Friday national cabinet's meeting to discuss elements of housing. Should we expect this budget to be ambitious in terms of housing supply?

On Friday national cabinet's meeting to discuss elements of housing. Should we expect this budget to be ambitious in terms of housing supply?

Yes, you should, and it will build on the $25 billion and 17 existing policies that we've invested in over the course of the last two years. Housing will be front and centre in the budget. It's going to be a big part of what people can expect to hear on Tuesday night. That's because we don't have enough homes. We need to build more homes for more, uh, people. Uh, and that requires a bunch of things. It requires more Commonwealth investment, and we will do our bit. It requires the states and territories to to do their bit. And I'm confident that they will. It requires a better, bigger workforce. And that's why we're paying for 20,000 fee free opportunities to to train more builders and construction workers. All of these things need to happen if we are to hit that ambitious but achievable target of 1.2 million homes for five years after this July. Uh, so, yes, uh, long way of saying people should expect housing to be a big focus and that we will do our bit, we'll do our bit and we will fund our bit.

Yes, you should, and it will build on the $25 billion and 17 existing policies that we've invested in over the course of the last two years. Housing will be front and centre in the budget. It's going to be a big part of what people can expect to hear on Tuesday night. That's because we don't have enough homes. We need to build more homes for more, uh, people. Uh, and that requires a bunch of things. It requires more Commonwealth investment, and we will do our bit. It requires the states and territories to to do their bit. And I'm confident that they will. It requires a better, bigger workforce. And that's why we're paying for 20,000 fee free opportunities to to train more builders and construction workers. All of these things need to happen if we are to hit that ambitious but achievable target of 1.2 million homes for five years after this July. Uh, so, yes, uh, long way of saying people should expect housing to be a big focus and that we will do our bit, we'll do our bit and we will fund our bit.

So the fact that the national cabinet meeting on Friday, does that mean that there's something new that's being informed or handed to the states on Friday? Or is it simply a meeting to say what you already know? We're actually finalising in the budget? Should we be expecting, in other words, a big surprise on housing.

So the fact that the national cabinet meeting on Friday, does that mean that there's something new that's being informed or handed to the states on Friday? Or is it simply a meeting to say what you already know? We're actually finalising in the budget? Should we be expecting, in other words, a big surprise on housing.

I know not to, uh, front run or pre-empt or make assumptions about conversations with the states and territories, uh, you know, two terrific colleagues, uh, one called Anthony and one called Julie, uh, are doing a lot of this work at the moment. Obviously, we've got an interest and an involvement in that. I don't want to pre-empt it. Uh, but I am prepared to say that we want to work with the states and territories to build more homes. Uh, you think about the pressures on rent, uh, how hard it is for people to get into the housing market. We've got a responsibility here. And we we will meet it.

I know not to, uh, front run or pre-empt or make assumptions about conversations with the states and territories, uh, you know, two terrific colleagues, uh, one called Anthony and one called Julie, uh, are doing a lot of this work at the moment. Obviously, we've got an interest and an involvement in that. I don't want to pre-empt it. Uh, but I am prepared to say that we want to work with the states and territories to build more homes. Uh, you think about the pressures on rent, uh, how hard it is for people to get into the housing market. We've got a responsibility here. And we we will meet it.

What do you say to those people who are worried extra homes means crowding in and changing the nature of their suburbs?

What do you say to those people who are worried extra homes means crowding in and changing the nature of their suburbs?

Yeah. I mean, it does remind us that planning is a big part of the story here. Uh, and planning can sometimes be contentious. We know that planning has to change a big part of the story. We need to make sure, uh, that we're releasing the land and we've got the planning arrangements which will support us building more homes. Can you? That is a huge objective that we need to share at every level of government.

Yeah. I mean, it does remind us that planning is a big part of the story here. Uh, and planning can sometimes be contentious. We know that planning has to change a big part of the story. We need to make sure, uh, that we're releasing the land and we've got the planning arrangements which will support us building more homes. Can you? That is a huge objective that we need to share at every level of government.

Can you offer more financial incentives to the states to do that land release. So there's actually a bit more pressure on the system to open up new areas where homes can be built.

Can you offer more financial incentives to the states to do that land release. So there's actually a bit more pressure on the system to open up new areas where homes can be built.

Are we are doing a bit of that already. Um, and I think that is important. Um, because, you know, I speak to a lot of local councils, state governments, obviously investors, you know, we're all trying to work out how to get these homes built. Uh, and one of the one of the issues is, uh, infrastructure bottlenecks in terms of land release. Yeah. So we have, uh, provisioned some money in the past for that. Can you do.

Are we are doing a bit of that already. Um, and I think that is important. Um, because, you know, I speak to a lot of local councils, state governments, obviously investors, you know, we're all trying to work out how to get these homes built. Uh, and one of the one of the issues is, uh, infrastructure bottlenecks in terms of land release. Yeah. So we have, uh, provisioned some money in the past for that. Can you do.

More of that? I'm trying to find out whether that's going to be a big theme, because it's easy to say there's some land here to release. Yeah, but states will need federal help to build the roads and the railway lines to get to that new destination.

More of that? I'm trying to find out whether that's going to be a big theme, because it's easy to say there's some land here to release. Yeah, but states will need federal help to build the roads and the railway lines to get to that new destination.

Yeah, infrastructure is a big part of the story. Uh, and whether it's the public transport or the road infrastructure, uh, equally the kind of smaller scale local government level, uh, infrastructure that can be a bottleneck. Uh, we've shown a willingness to, to come to the table on that in the past. Uh, and you can assume from that that we'd be willing to do that again in the future.

Yeah, infrastructure is a big part of the story. Uh, and whether it's the public transport or the road infrastructure, uh, equally the kind of smaller scale local government level, uh, infrastructure that can be a bottleneck. Uh, we've shown a willingness to, to come to the table on that in the past. Uh, and you can assume from that that we'd be willing to do that again in the future.

We've seen community concern about where migration is going. Will the government's cut to offshore student numbers and other changes to migration actually have the impact of reducing economic growth?

We've seen community concern about where migration is going. Will the government's cut to offshore student numbers and other changes to migration actually have the impact of reducing economic growth?

Well, what you'll see in the budget forecast is that net overseas migration next year will be about half what it was last year. Um, and that reflects a couple of things. It reflects that the big spike in students in particular, but also long term tourists that we saw after Covid, you know, that is washing out a bit out of the system. But also, uh, to her credit, Claire O'Neill and other colleagues have put some effort into making sure that the student market in particular, uh, is, is robust and defensible so that the people who are coming here to study are coming here genuinely to study. And that's part of the story as well. And we ended the pandemic visa and a whole bunch of stuff that we did to try and moderate, uh, this growth. Um, I don't really necessarily see that, uh, as, uh, denying ourselves, uh, growth in the economy. Um, obviously, you know, the amount of people and the distribution of people in our economy matters to our to our prospects. Uh, but I just see it as a responsible way of managing the situation, uh, and making sure that we can manage the pressures on our communities. Uh, and so that is our objective, uh, that will impact on the forecast for growth and the economy, but worth it.

Well, what you'll see in the budget forecast is that net overseas migration next year will be about half what it was last year. Um, and that reflects a couple of things. It reflects that the big spike in students in particular, but also long term tourists that we saw after Covid, you know, that is washing out a bit out of the system. But also, uh, to her credit, Claire O'Neill and other colleagues have put some effort into making sure that the student market in particular, uh, is, is robust and defensible so that the people who are coming here to study are coming here genuinely to study. And that's part of the story as well. And we ended the pandemic visa and a whole bunch of stuff that we did to try and moderate, uh, this growth. Um, I don't really necessarily see that, uh, as, uh, denying ourselves, uh, growth in the economy. Um, obviously, you know, the amount of people and the distribution of people in our economy matters to our to our prospects. Uh, but I just see it as a responsible way of managing the situation, uh, and making sure that we can manage the pressures on our communities. Uh, and so that is our objective, uh, that will impact on the forecast for growth and the economy, but worth it.

The other side of the population growth is natural population growth. Yeah. Fertility rates down 20% since 2008. The natural population growth is down 14% from 2019. You're a father of three. Why do you think Australians are having fewer children?

The other side of the population growth is natural population growth. Yeah. Fertility rates down 20% since 2008. The natural population growth is down 14% from 2019. You're a father of three. Why do you think Australians are having fewer children?

I think people are leaving it later. Uh, and, um, sometimes that means you get timed out. Um, but there are a whole range of reasons people's preferences are changing. Um, uh, it's expensive to raise kids.

I think people are leaving it later. Uh, and, um, sometimes that means you get timed out. Um, but there are a whole range of reasons people's preferences are changing. Um, uh, it's expensive to raise kids.

Your government has put a lot into areas from child care to Pell. Yeah. Why not revisit the baby bonus?

Your government has put a lot into areas from child care to Pell. Yeah. Why not revisit the baby bonus?

Oh, I think the answer is in your question. You know, we think that there are better ways to do that. You know, I don't knock what Peter Costello did all those years ago, uh, around that first intergenerational report. In fact, I've given him, uh, credit for starting the Intergenerational Report, which was part of this important, uh, conversation. It's helped educate our choices about the aging of the population. Um, it would be better if birth rates were higher. Uh, and we need to balance that against all of the other ways that our population grows. But people have got different preferences, and we want to make it easier for them to make choices in their own interests. So paid parental leave, adding superannuation guarantee to that huge investments in early childhood education. All of these things are about trying to, um, make it easier for people to have more kids if they want to, uh, and to work more if they want to, after they've had their kids.

Oh, I think the answer is in your question. You know, we think that there are better ways to do that. You know, I don't knock what Peter Costello did all those years ago, uh, around that first intergenerational report. In fact, I've given him, uh, credit for starting the Intergenerational Report, which was part of this important, uh, conversation. It's helped educate our choices about the aging of the population. Um, it would be better if birth rates were higher. Uh, and we need to balance that against all of the other ways that our population grows. But people have got different preferences, and we want to make it easier for them to make choices in their own interests. So paid parental leave, adding superannuation guarantee to that huge investments in early childhood education. All of these things are about trying to, um, make it easier for people to have more kids if they want to, uh, and to work more if they want to, after they've had their kids.

What's your philosophy with this budget? When you did your PhD on Paul Keating, you were researching and studying somebody who was about divesting assets, opening up the free market and scaling back government. You sold off Qantas. He sold off the com bank. You're scaling up government. You're scaling up investment in public assets or private assets through public loans and so forth. Have you changed your economic philosophy over time, and is that reflected in in the budget?

What's your philosophy with this budget? When you did your PhD on Paul Keating, you were researching and studying somebody who was about divesting assets, opening up the free market and scaling back government. You sold off Qantas. He sold off the com bank. You're scaling up government. You're scaling up investment in public assets or private assets through public loans and so forth. Have you changed your economic philosophy over time, and is that reflected in in the budget?

Well, I don't see it as a repudiation of the really quite remarkable progress that Paul and Bob and their colleagues made in the 80s and 90s. You know, there's probably no one in this Parliament that's in your question again, uh, who has been more attentive to or more grateful for that really quite remarkable golden period of reform. Um, what we're talking about here is not a repudiation of that. It's just a recognition that the the world has changed and the orthodoxy has changed as well, the sorts of things that we're contemplating. First of all, they are largely about incentivizing private investment, but they're not out of place in the investor community that I move in global and domestic. They're not out of place amongst my colleagues and counterparts around the world. The orthodoxy has changed just as the world has changed and the pace of that change is accelerating. And what for Paul in the 80s and 90s was opening up without selling out? Uh, for us is about investing and engaging, not protecting or retreating. Uh, we're not talking about manufacturing the past. We're talking about powering the future of our economy. And if Paul was in my job in 2024 rather than 1984, I suspect he would be interested in the energy transformation to have, you know, he be. Yeah. We talk about this from time to time. Um, the.

Well, I don't see it as a repudiation of the really quite remarkable progress that Paul and Bob and their colleagues made in the 80s and 90s. You know, there's probably no one in this Parliament that's in your question again, uh, who has been more attentive to or more grateful for that really quite remarkable golden period of reform. Um, what we're talking about here is not a repudiation of that. It's just a recognition that the the world has changed and the orthodoxy has changed as well, the sorts of things that we're contemplating. First of all, they are largely about incentivizing private investment, but they're not out of place in the investor community that I move in global and domestic. They're not out of place amongst my colleagues and counterparts around the world. The orthodoxy has changed just as the world has changed and the pace of that change is accelerating. And what for Paul in the 80s and 90s was opening up without selling out? Uh, for us is about investing and engaging, not protecting or retreating. Uh, we're not talking about manufacturing the past. We're talking about powering the future of our economy. And if Paul was in my job in 2024 rather than 1984, I suspect he would be interested in the energy transformation to have, you know, he be. Yeah. We talk about this from time to time. Um, the.

I think he's on board with Future Made in Australia.

I think he's on board with Future Made in Australia.

Um, well, I know that he he sees the energy transformation as Australia's big chance. Uh, and that's what this is fundamentally about. You know, I think a lot of people recognize that the global net zero shift, it's not the only show in town, but it's the main show in town. And we need to be part of it. Uh, and if we're if we don't make ourselves an. To a part of that, uh, our people will be poorer and our economy will be more vulnerable, and our and our society will be weaker as a consequence.

Um, well, I know that he he sees the energy transformation as Australia's big chance. Uh, and that's what this is fundamentally about. You know, I think a lot of people recognize that the global net zero shift, it's not the only show in town, but it's the main show in town. And we need to be part of it. Uh, and if we're if we don't make ourselves an. To a part of that, uh, our people will be poorer and our economy will be more vulnerable, and our and our society will be weaker as a consequence.

One of your apart from economic reform has been institutional reform, the reserve Bank. You've really been pushing in that space. Of course, the bank board met this just this week. But under your original timetable, that board would only meet once more before July 1st, and then we'd have moved to a monetary policy committee. But you haven't got that through Parliament. Where is it up to? And surely you can't expect that you'll get you'll hit that target now.

One of your apart from economic reform has been institutional reform, the reserve Bank. You've really been pushing in that space. Of course, the bank board met this just this week. But under your original timetable, that board would only meet once more before July 1st, and then we'd have moved to a monetary policy committee. But you haven't got that through Parliament. Where is it up to? And surely you can't expect that you'll get you'll hit that target now.

Well, unfortunately, some of that is in the hands of the Parliament. Uh, and you've probably followed more closely than anyone, uh, our efforts to make this a bipartisan thing. I think the future of our central bank should be beyond partisan politics. I genuinely believe that. That's why we put so much effort into engaging with and briefing and consulting the opposition. Uh, unfortunately, they teamed up with the Greens to put it into a committee process which has delayed things more than I would like. I'm just being upfront about that. Uh, we would like to be further progressed, but we're not. We play the cards that we're dealt in the Senate in particular. Uh, but we are working away behind the scenes to do everything that we need to do to be ready for that deadline. Uh, and that includes things like, um, you know, I speak quite frequently with Governor Bullock about the optimal composition and combination on those two new boards, Monetary Policy and Governance Board, in addition to the old payments Board, to make sure that we be at the best combination of talents and to make sure that we get continuity on both boards rather than on one board. And that's one of the things that our opponents have have disagreed with.

Well, unfortunately, some of that is in the hands of the Parliament. Uh, and you've probably followed more closely than anyone, uh, our efforts to make this a bipartisan thing. I think the future of our central bank should be beyond partisan politics. I genuinely believe that. That's why we put so much effort into engaging with and briefing and consulting the opposition. Uh, unfortunately, they teamed up with the Greens to put it into a committee process which has delayed things more than I would like. I'm just being upfront about that. Uh, we would like to be further progressed, but we're not. We play the cards that we're dealt in the Senate in particular. Uh, but we are working away behind the scenes to do everything that we need to do to be ready for that deadline. Uh, and that includes things like, um, you know, I speak quite frequently with Governor Bullock about the optimal composition and combination on those two new boards, Monetary Policy and Governance Board, in addition to the old payments Board, to make sure that we be at the best combination of talents and to make sure that we get continuity on both boards rather than on one board. And that's one of the things that our opponents have have disagreed with.

Will that monetary policy committee be in place, say, for its August meeting?

Will that monetary policy committee be in place, say, for its August meeting?

Uh, I'd like it to be. I mean, it's it's subject to the to the Senate in one way or another, unfortunately. But I'll certainly do everything that I need to do, uh, to make it possible, uh, to have the, the two new boards, uh, constituted and ready to go.

Uh, I'd like it to be. I mean, it's it's subject to the to the Senate in one way or another, unfortunately. But I'll certainly do everything that I need to do, uh, to make it possible, uh, to have the, the two new boards, uh, constituted and ready to go.

What should Australians expect on Tuesday night? Because you've had various themes for previous economic statements and budgets. What's the theme we should be expecting?

What should Australians expect on Tuesday night? Because you've had various themes for previous economic statements and budgets. What's the theme we should be expecting?

This budget will be about relief and reform. It'll be about relieving cost of living pressures in the here and now, and positioning our economy to take maximum advantage of, of these opportunities into the future. Uh, it'll be about cost of living help and a future made in Australia. And that's what, uh, that's what people should expect to see. And that will all be built on, uh, the kind of responsible economic management which saw us deliver a surplus in our first year and pay down all of that debt. Uh, not as an end in itself, but so that we can make room for all of these other priorities. But primarily, I think anyone who tunes into the budget on Tuesday night will see a government that is very focused on easing pressures in the here and now at the same time as we invest in the future.

This budget will be about relief and reform. It'll be about relieving cost of living pressures in the here and now, and positioning our economy to take maximum advantage of, of these opportunities into the future. Uh, it'll be about cost of living help and a future made in Australia. And that's what, uh, that's what people should expect to see. And that will all be built on, uh, the kind of responsible economic management which saw us deliver a surplus in our first year and pay down all of that debt. Uh, not as an end in itself, but so that we can make room for all of these other priorities. But primarily, I think anyone who tunes into the budget on Tuesday night will see a government that is very focused on easing pressures in the here and now at the same time as we invest in the future.

Well, thanks very much for your time. Thanks for joining us for the podcast.

Well, thanks very much for your time. Thanks for joining us for the podcast.

I really appreciate it, guys. Thanks very much.

I really appreciate it, guys. Thanks very much.

Today's episode of Inside Politics was produced by Kai Wong and Rachel Clun, with technical assistance by Debbie Harrington. Our head of audio is Tom McKendrick. Inside politics is a production of The Age and The Sydney Morning Herald. If you enjoy this show and want more of our journalism, subscribe to our newspapers today. It's the best way to support what we do. Search the age or Smh.com.au forward slash. Subscribe. I'm Jacqueline Maley, this is inside politics. Thank you for listening.

Today's episode of Inside Politics was produced by Kai Wong and Rachel Clun, with technical assistance by Debbie Harrington. Our head of audio is Tom McKendrick. Inside politics is a production of The Age and The Sydney Morning Herald. If you enjoy this show and want more of our journalism, subscribe to our newspapers today. It's the best way to support what we do. Search the age or Smh.com.au forward slash. Subscribe. I'm Jacqueline Maley, this is inside politics. Thank you for listening.