CANBERRA, ACT, Feb. 3 -- The Treasurer of Australia issued the following transcript:

Note

Subjects: inflation, interest rates

Matt Shirvington:

Great to have you with us. Look, almost every economist is saying the same thing - government spending is to blame here. Do you disagree with all of them?

Jim Chalmers:

Well, there's not a unanimous view amongst the economists about what's driving the most recent tick up in inflation, but if you look at the facts, that tick up in the most recent data was largely about holiday spending, the withdrawal of the energy rebates and some more persistent issues in housing.

And so there are some temporary issues, some permanent or persistent issues when it comes to our inflation challenge, but we acknowledge we've got this challenge in our economy. We know that people are under pressure, but more than acknowledge that, we're rolling out cost‑of‑living help, we're repairing the budget because we know that even though the budget is not the primary determinant of prices in our economy, governments can play a helpful role, and that's our focus.

Nat Barr:

But Jim, the rest of the world has had holidays, too. They've got issues. We now have the highest inflation in the developed world, don't we - UK, US, Germany, Japan, Canada, France - all these countries are better than us. What are you doing wrong?

Chalmers:

Well, you've got to make the whole comparison, Nat. We've got lower unemployment than most of those countries, we've got faster economic growth than all of those countries except for the US, we've got a much better budget than those countries in the G7, the major advanced economies and so you've got to make the whole comparison.

The government is not disputing that we've got a challenge with inflation in our economy. The numbers which came in last week came in not that much higher than we expected but higher than we would like. We know that people are still under pressure, that's why our cheaper medicines policy is so important, more bulk billing, student debt relief, 2 more tax cuts. It's all about not just acknowledging that people are under pressure but acting on it, and doing that at the same time as we have dramatically improved the budget since we came to office.

The budget is more than $200billion stronger than when we came to office. We found $114billion in budget savings. The big story of the economy last year was public demand taking a back seat to private demand and private spending. And so we are managing the budget and the economy in a responsible way. We know that this inflation challenge is more persistent than anyone would like, and that's why it's our focus.

Shirvington:

Well, let's talk about that quickly, because people are making decisions on things that you say obviously. You said this back in June - let's just have a listen to this.

[Excerpt]

Chalmers:

The worst of the inflation challenge is now well and truly behind us.

[End of excerpt]

Shirvington:

You talk about responsible fiscal policy. That felt a bit irresponsible, didn't it, saying that the worst is behind us when you look now at what we're facing?

Chalmers:

Well, what I said then is absolutely and objectively true - the worst of the inflation challenge was in 2022 -

Shirvington:

But it's trending up again.

Chalmers:

But the worst inflation that we have had in recent years was in 2022. When we came to office, inflation had a 6 in front of it and was absolutely galloping. It peaked at 7.8 that year. This year inflation is higher than we want it to be - it's got a 3 in front of it. So the worst of the inflation that we've seen in recent years is in 2022, and that remains the case.

Now, that's not to dismiss the very real pressures that people are confronting right now. That's why our political opponents are tearing themselves apart. We're not distracted by that. We're focused on what really matters to people - the cost of living, housing, the economy more broadly because we know that that's the main game.

Australians have made a heap of progress in our economy the last few years. Inflation is lower than in 2022 but still higher than we would like, unemployment is in the low fours, business investment has been recovering strongly, the budget is in a better position than it was 3 and a half years ago - all of those things can be true at the same time as we recognise as a government and certainly me as Treasurer, we know that we've got more work to do, and that's our focus.

Barr:

Yep, still a long way to go. Thank you very much, Treasurer.

Chalmers:

Thank you.

Disclaimer: Curated by HT Syndication.