Topics:  Labor’s homegrown inflation, Labor’s housing tax, 

E&OE   

 

CHRIS KENNY: 

I put it to Shadow Treasurer Angus Taylor, that Labor's trickery has failed to con the Reserve Bank. 

 

ANGUS TAYLOR: 

They won't be conned. The Reserve Bank won't be conned. This government constantly deals with the symptoms of inflation rather than going to the source. They're always putting a band aid on a bullet wound Chris, and it won't work. And the Reserve Bank yesterday, the Governor couldn't have been clearer, the statement from the Reserve Bank couldn't have been clearer. They have to see sustained reductions in inflation, not temporary reductions, and what the government has done is a temporary reduction, which will come straight back on next year. And the Reserve Bank is just not going to take any notice of that, and frankly, nor are Australians, because they've got to pay for it again next year. So look, this is exactly what we see from this government. Everything is politics, but when it comes to inflation, you've got to deal with the underlying policy, the source of the problem, and that's what this government refuses to do, because they're out of their depth and they're out of touch when it comes to fighting and beating inflation.  

 

CHRIS KENNY: 

Yeah, well, there were two points on that really. First of all, when it comes to electricity prices, yeah, the way to tackle that is to actually put in policies that gives us cheaper, more reliable electricity and that will depress inflation, rather than using taxpayers' money to artificially subsidise electricity prices. You're not dealing with the real problem there. 

 

ANGUS TAYLOR: 

Well, it's because they've failed. They've failed. They promised a $275 reduction. We haven't seen that. We've seen, obviously, huge increases in electricity prices since Labor came to power, at the same time as emissions have gone up, Chris. This is how badly Chris Bowen has failed on his policy objectives. He's not even close. And so now they're handing out subsidies, which ultimately don't solve the underlying inflation problem and don't help to bring interest rates down, which we desperately want and need to see as soon as possible. So the government will pat itself on the back for doing what, for not solving the problem. But yeah, it seems to be a recurring pattern.  

 

CHRIS KENNY: 

Well, that's the other side. The other fork in this economic policy, if you could call it that, is that the subsidies come off. They come off next year. And so if we saw this headline inflation rate drop down now, the Reserve Bank and consumers know it's going to come back up again when the subsidies come off and power prices jump. 

 

ANGUS TAYLOR: 

That's exactly right, Chris. And even more than that, what we saw in the data today is that the trimmed mean, the core inflation rate is still well above target. We are at the back of the pack compared to other peer countries around the world in terms of bringing inflation down. Our inflation is higher than every other major advanced country outside of the UK, and they're a basket case economically right now. That's not where we want to be, but it's actually where we're at. And the Reserve Bank understands that. The statement from the Governor and the press conference was very sober. It recognised that labour productivity in this country has been in absolute free fall, over 6% reduction since Labor came to power. It recognised that immigration is making, excessive immigration, is making the situation far worse, and that we're still a long way from getting to where we need to if we're going to restore Australians' standard of living, and there's no sign of that happening anytime soon.  

 

CHRIS KENNY: 

Now going back, when Bill Shorten was leading Labor and they tried to win an election by being honest about their policy agenda and failed, of course, but he promised then to get rid of some of the tax concessions for real estate investments, negative gearing and capital gains tax concessions. Labor, this time under Jim Chalmers and Anthony Albanese, promised to leave all that alone, but we learn now that Treasury is actually looking at negative gearing changes. 

 

ANGUS TAYLOR: 

Exactly right. You can't trust Labor when it comes to tax, Chris. Already they're going after franking credits, we've seen that. They're going after superannuation, they're imposing a tax on unrealised capital gains. And now we learn that they're secretly working on a plan to impose a tax on negative gearing, on capital gains tax, effectively a housing tax.  

 

CHRIS KENNY: 

This is the problem. Sorry for me jumping in there, Angus, sorry. Apart from the broken promise, the problem here, isn't it, is if you want more housing available, if you want more renters to be able to get into accommodation, you don't tax real estate investment, you encourage it. 

 

ANGUS TAYLOR: 

You know, it's a great rule of taxation. When you learn about taxation in economics, that if you want less of something, you tax it more, and they clearly want less housing. It's bizarre. But we know they have a vision of housing which is completely at odds with the Australian people. They want houses to be apartments. If people want to live in an apartment, knock yourself out, but a lot of Australians want free standing houses. They want them built by the CFMEU, because they're their mates. And they want them owned by big investment funds and rented by Australians. That's their vision of housing. They don't want a local plumber or local chippy who's bought a couple of houses and done them up and then is renting them out. They hate that. That's not the Labor vision. Well, it's my picture of what a good housing policy looks like, a good housing outcome looks like. And it's much closer, I think, to the genuine Australian dream, which we've been losing in recent years, of owning your home over time, you rent often when you're younger. And that, I think, is an essential part of what it is to grow up and have a family in Australia.  

 

CHRIS KENNY: 

I think you're right. I think it's the Australian way. And if they want to have that fight coming up to the next election, you can add that to their list of problems. Thanks for joining us, Angus Taylor, I appreciate it. 

 

ANGUS TAYLOR: 

Good on you Chris. 

 

ENDS.