E&OE TRANSCRIPT
SUBJECTS: Reserve Bank’s decision on interest rates; mortgage pressure on families; energy costs
PETER STEFANOVIC, HOST: Let's go to Canberra now. Joining us live, the NDIS and Government Services Minister Bill Shorten. Bill, good to see you. Thanks for your time this morning. So, economists are split over whether the RBA increases rates again today, but how are you feeling this morning about a potential 12th rate hike?
BILL SHORTEN, MINISTER FOR THE NDIS AND GOVERNMENT SERVICES: I feel for mortgage holders. They're doing it tough. I mean, when you look at the increases and the impact it has on average mortgages and of course, for an average mortgage, that means half the people are above that. And another mortgage increase now will be very tough on family budgets.
STEFANOVIC: At national and state levels, there are boosts to minimum wages that are taking place at the moment. It is inflationary, so is there a danger that that becomes counterproductive?
SHORTEN: Well, both the President of the Fair Work Commission, that's the independent umpire who sets the minimum wage and the Governor of Reserve Bank have said that these increases, that the wage increases to nominal wages will not actually have an inflationary impact. The minimum wage is going to $23.25 an hour. That's very hard to make ends meet on $23.25 an hour, Pete so I don't accept - the other thing, of course, is the minimum wage increase hasn't happened, so it's a bit hard to blame a wage rise for low paid workers, which they haven't got, for the inflation we're already experiencing in the system. So no, I think the balance of opinion is that increases to the nominal wage here are not actually driving inflation. That's to do with factors largely driven from overseas.
STEFANOVIC: Even if there is a pause today, it does seem as though there would be another 1 or 2 rises that will eventually come this year. What are your fears of where this mortgage stress will leave some of that you just referred to in your first answer?
SHORTEN: I think it's incredibly tough. You know, I see some of the more hawkish economists saying, you know, blah, blah, blah, got to increase rates. Well, I'm not sure that's much comfort to hundreds of thousands of households who will be coming off fixed rate mortgages this year because that means that they'll be getting the whammy of several increases in one hit because their fixed rate is closing. I think people are doing it tough. That's why, for example, our energy price relief for 5 million households in the budget is well targeted. That's why the support for reducing the cost of childcare is well targeted. And of course, we all need medicine and cheaper medicines is something that the Government's contributing to right now. So, we're doing what we can. But I - you know, you can't sugar coat it, this is pretty tough for a lot, for millions of households.
STEFANOVIC: Despite that price relief, though, there are claims this morning that wholesale prices, when it comes to energy, will remain stubbornly high for several more years to come. Is it time to write off that election pitch of a $275 saving by 2025?
SHORTEN: Well, first of all, I think we've seen that because of our energy policies in the last 12 months, it's viewed that this is actually meant that inflation is three quarters of a per cent lower than it otherwise would. So, I do think we're making the right measures. Energy prices going up or being high for the next few years really makes you realise what we've squandered in all the rubbish climate change debates we've had for the last decade and a half of Australian politics. I mean we saw four gigawatts in the last decade roughly, taken out of the energy production market and only one gigawatt of new energy installed. These are - this shows that we need, we've needed market certainty so investors can move in. History doesn't grant a rerun, but I really do lament what little work happened on energy policy under our predecessors. And it just takes a while to put in place the new infrastructure.
STEFANOVIC: So, is it time to bin that election pitch, though, that promise of a of a saving by 2025? Or are you still hopeful that that will be achieved?
SHORTEN: Well, we're not at 2025 yet, so it'd be premature, I think, just to say that. But there's no doubt that we've seen - when that promise was made, that was before the Russians commenced their illegal war against Ukraine, which of course has had a big energy price shock right through the whole global economy. But I think when we look at our capping of gas prices and other matters, Labor hasn't wasted a day. We just want to get on and make sure we can do whatever we can to put downward pressure on energy prices.
STEFANOVIC: All right, Bill Shorten, appreciate it. We'll talk to you soon.