Treasurer Jim Chalmers grilled by Nat Barr as he defends $300 power rebate in Federal Budget

Treasurer Jim Chalmers has defended his Budget on Sunrise, saying people who earn a million dollars a year will get the $300 energy bill relief because it’s the “easiest way”.

Chalmers handed down his back-to-back budget surplus last night and has branded its Budget as an inflation-fighting weapon of precision. However, the reaction has not followed this rhetoric, with economists warning broad cost-of-living relief such as energy rebates and tax cuts for all may make things worse.

The first topic in the firing line was the non-means tested $300 energy bill relief.

“What happens with this energy bill relief is it comes off your bills. So if you pay your energy bills quarterly, you will get a $75 credit four times over the course of the next financial year,” Dr Chalmers stated.

“That will help take some of the sting out of cost-of-living pressures that I know people are under.”

Hitting back, Barr questioned: “If you’re earning a million dollars, why do you need a $300 power rebate?”

“Well, the energy bill rebate is primarily for people doing it tough. You know, millions and millions of Australians are under cost-of-living pressure.,” Dr Chalmers said.

“We’re doing more than just acknowledging that in the Budget. We’re trying to help.”

Pushing the treasurer to answer the question, Barr said: “You’re also getting it if you earn a million bucks. Why are they getting it?”

“That’s not the focus,” Dr Chalmers fired back.

“Because cost-of-living pressures are being felt right around our country.”

Barr questioned if “the million-dollar people” were under pressure.

“Yes, so once you go beyond providing this energy bill rebate like we did in the last Budget, for people who are on pensions and payments, once you go beyond that, you have to design a whole new system because the energy retailers that we use to provide this help, they don’t have income information for people,” Dr Chalmers said.

Seeking clarification, Barr questioned if it was a computer problem that did not allow the Government to know how much people earned.

“Well, we deliver this relief via energy bills, via the retailers. There’s not a system that allows you to slice and dice that allows you to slice and dice that beyond providing it either to people on pensions and payments or more broadly,” Dr Chalmers said.

Moving on to the topic of inflation, Barr asked how sure Chalmers was that his budgetary measures would not push up inflation.

“Well, the tax cuts are roughly the same size as the tax cuts they replace. So they won’t put additional pressure on the inflation forecast.”

“What we saw when we did this in the last Budget, for example, is instead of energy bills going up on average by 15 per cent in the year to March, they went up by 2 per cent.”

“So you can see by getting some of the edge off these bills, some of these big pressures that people are under, by putting downward pressure on bills, we put downward pressure on bills, we put downward pressure on inflation.”

Pointing out that the RBA and the treasury can get figures wrong, Barr pressed Dr Chalmers on how he knew the figures were right.

“In terms of the forecast, obviously treasuries and Reserve Banks, they make their best estimate of how they expect the future to play out. We’re not at odds with anyone. Our forecast takes into consideration the budget that I handed down last night, the Reserve Bank forecasts were from an earlier period where they weren’t able to do,” Dr Chalmers said.

Barr presented one forecaster’s reaction to the Budget, paraphrasing them as saying: “It’s like you’ve dieted for two years, but crumbled after someone shoved a bucket of KFC under your nose and now you’re spending too much.”

“Well, that’s not a forecaster, that’s a journalist. There are lots of opinions about Budgets. Typically this time of year, people’s opinions are pretty thick on the ground. My job is to just try and take the right decisions for the right reasons,” Dr Chalmers said.

“There will be lots of commentary. But I have to make things add up. I have to make the right calls for the right reasons. I’m confident in this Budget that we have.”

With a Federal election set for early next year, Barr questioned if this Budget was designed to get “everyone in a good mood”.

“No, that’s not our motivation,” Dr Chalmers said.

“Our motivation here is understanding that people are doing it tough and that we need to provide substantial cost-of-living relief in a responsible way. That’s what the budget does. So will there be a Budget does.”

“So will there be a Budget before the next election?,” Barr asked.

“That remains to be seen. I will certainly be ready to deliver another Budget next year,” Dr Chalmers said.“Our intention, our inclination, is to go full term. But that decision is taken by the Prime Minister. If I need to do a fourth Budget before we go to the people, I would be happy to do that, be ready to do that, but that is not a decision I take on my own.”