Sam Rae (Hawke, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. What is the Albanese Labor government's approach to wages in the budget, and why is it so important to get wages moving?

Jim Chalmers (Rankin, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

Thank you to the member for Hawke for his question and for all the work that he does on behalf of his community here in this place.

Getting wages growing again is a deliberate design feature of our economic policy. That's why we do need to fix what is a broken bargaining system, which is only delivering stagnant wages—particularly for the low-paid and for industries dominated by women. It's why the budget is all about investing in skills so that we can train people for higher wage opportunities. It's about early childhood education—making it cheaper so that more parents can work more and earn more if they want to. It's about investing in the industries where we'll get the secure well-paid jobs, whether those are in areas of traditional strength or in new industries as well.

It's why we have started to make provision for the important interim wage outcome that has been announced by the Fair Work Commission for aged-care workers. And it's why one of the first decisions, if not the very first decision, of the cabinet of this new government was to support a decent minimum wage rise.

In the budget, the Treasury has now upgraded its forecast for wages growth to be 3.75 per cent this year and next. If that happens, it will be the fastest since 2012—and that would be a good thing. What we do know is that when inflation is high and rising it makes it even harder for Australians to keep up. Part of the reason for that is that for too long in this country wages have been too stagnant, and that has made it harder for people to keep up and harder for people to get ahead.

Under the life of the previous government, wages growth was just 2.1 per cent on average, compared with 3.6 per cent under the Labor government that preceded it. So, you can see that for the best part of a decade we've had wage stagnation. Nothing would make those opposite happier than another decade of wage stagnation and wage suppression. That's what they're here for. We know this because the shadow Treasurer was asked on TV why he opposed our industrial relations changes, and he said, 'Because it will push wages up'—which is kind of the point. It says it all, about the differences between the side of the House and that side of the House. We have policies and plans to get wages moving again. We want Australian workers to get a bigger slice of the action when the economy is growing. They failed on wages, and ordinary people copped it in the neck as a consequence.

So, there's a very important reason the minister for skills has been investing in skills and the ministers for education and early childhood education have been investing in cheaper child care. It's why the minister for industry has been investing in our supply chains and the industries that will secure, well-paid work. It's why the minister for aged care, working with the minister for health, has been so supportive of a decent pay rise for our aged-care workers. It's why the Prime Minister, during the campaign, and the industrial relations minister afterwards—all the cabinet—have been so supportive of a decent minimum wage rise. It's because we want to see wages growing again. You would happily see another decade of wage stagnation. (Time expired)

Dai Le (Fowler, Independent) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer tell the House how the government can offer additional childcare relief for those earning up to $530,000 while removing the low and middle income tax offset for individuals and families earning less than $130,000, who need tax relief the most during a cost-of-living crisis? How will the government provide immediate relief for struggling families like those in Fowler?

Jim Chalmers (Rankin, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

Once again, I appreciate the question from the member for Fowler and thank her for the conversations we've had about cost of living in the past. We do recognise and we do understand that when inflation is high and rising for longer than we would like then Australian families and Australians more broadly are under more pressure than we would like. When it comes to the low and middle income tax offset, it was a decision taken by our predecessors to end the LMITO, and that has ended. That's a decision that my predecessor, former Treasurer Frydenberg, made very clear.

What we have tried to do in the budget and what we have done in the budget is to provide cost-of-living relief to your constituents and to all our constituents in a way that doesn't add to inflation in our economy. We recognise that the reason real wages are going backwards is that inflation has been too high for too long. We recognise that interest rates are going up because inflation is higher than we want it to be, and that is largely a consequence of pressures coming from around the world, but it's felt around the kitchen tables of our communities. So, the cost-of-living relief that we are providing in the budget—whether it be cheaper early childhood education, whether it be the expansion of paid parental leave, whether it be the housing accord to get more, cheaper rental properties into the market, whether it be cheaper medicines or whether it be our policies to get wages moving again—are all about providing the cost-of-living relief that people need and deserve in a way that isn't counterproductive by making the inflation problem even worse. That's the government's strategy here. The alternative would be to risk making the inflation problem worse. But there is something like $7½ billion of cost-of-living relief flowing in the budget. As we go through these challenging times, if there's more that we can responsibly do then obviously we will consider it, and we'll always try to do the right thing by the member's constituents and by all the people we represent in this place.