Interview with Sarah Ferguson, 7.30, ABC

Subjects: domestic and family violence, housing, Intergenerational Report, AI, productivity, migration, opinion polls, tax, intergenerational issues Sarah Ferguson: The Treasurer joins me now. Treasurer, welcome. Jim Chalmers: Thanks very much, Sarah.

Let me just start by asking you something about that story we’ve just run on those horrific incidents at the weekend. One of the experts in that report referred to the fact that housing is one of the contributors, contributing factors to the domestic and family violence crisis in Australia. Is that on your radar as an issue of housing as a contributor?

Of course it is. I thought Fiona’s story then was horrific, hard to fathom. And despite all of these extra resources the state and federal governments are investing in tackling this issue, we’ve still got a huge problem in this country, and we need to have an open mind to all kinds of solutions.

But when it comes to housing already, crisis housing, all of the work that Clare O’Neill and Tanya Plibersek do in our team to make sure that when people leave violent situations, that they’ve got somewhere to go. That’s one of the big motivations behind a significant part of our very ambitious housing agenda. Just on, just to stay with the issue for a moment if I could Treasurer, what role do politicians have to play in terms of leadership on this issue?

We’ve been talking about the same problems for many years now. What can you do to shift it? Well, resourcing is important.

I work closely with the Prime Minister and with Katy Gallagher and the relevant ministers to make sure that police and others get the resourcing they need, working with state governments, housing is a big part of it as you just said. I found it compelling what we just heard then from the expert talking about the role of this monetised misogyny that we see online, and so clearly this problem is of significant magnitude.

Clearly, it has a whole number of sources, and this Albanese Labor government – working closely with state governments and with the relevant authorities – is very committed to doing absolutely everything we can because we recognise this is a very, very serious issue. And the violence and tragedy that we saw on the weekend, unfortunately, is just one part of that.

Okay, let’s talk about the Intergenerational Report. Given the age of uncertainty that we are living in, with AI looming as a catalyst of immense capacity for change, how meaningful is it actually to predict the shape of the economy so far ahead? This is an age of uncertainty, but we know enough about the big shifts in our economy and our society to compel us to plan for a future which is increasingly dominated by artificial intelligence, the energy transition, a whole different industrial base, the ageing of our population, the fragmentation of the geopolitical environment.

Those are the big shifts which are playing out in our economies and in our society around the world, and certainly here in Australia. And so, the Intergenerational Report is a really important way that we get our head around all of those influences, all those factors. It is the case that change is accelerating around the world, and certainly here in Australia, we’re realistic about the risks that all of that poses.

But we’re also optimistic about the future because we are genuinely better placed and better prepared, and we have a better plan than other countries to deal with all of this accelerating change that’s coming at us. Now, AI’s potential to drive productivity is central to the economic case that you’re making here. What happens to living standards if AI underdelivers on productivity in what the report calls the downside scenario?

Obviously decent productivity growth is the key to lifting living standards over the 40‑year period or so of the Intergenerational Report, I think that’s self‑evident. And artificial intelligence and technological change is a big part of the story, but not the only part of the productivity story. In our Budget just a few months ago, we had the biggest and broadest productivity package that this country has seen for decades, which is all about faster approvals and a more effective federation, and attracting more investment.

Sure, but you are relying on the yields from AI to underpin productivity growth in the document that you’ve laid out today and the arguments you’ve been making. So, what happens? Do you know happens?

In part but not solely. Artificial intelligence is, I think, the most fundamental change that we’ll see in our lifetime. It will be genuinely transformational.

Every aspect of our economy, every aspect of our society, in one way or another, will be touched by this technological revolution. And it does provide an opportunity for us to make our economy more competitive, more dynamic, and certainly more productive but only if we do a good job managing the risks, and the risks are substantial. And if there’s one takeout from this Intergenerational Report, it’s that our efforts on productivity, housing market reform, tax reform, and also managing the risks of artificial intelligence – all of those things are absolutely key to ensuring that we can continue to grow the economy over the coming decades, that people can share appropriately in the benefits of that growth, and that we maximise all of the opportunities, whether it’s from AI and/or in the economy more broadly, while we minimise some of these downside risks, which are obvious when it comes to AI.

Let’s talk about immigration. Obviously, there are numbers here, further decline particularly in Australia’s fertility rate, which also obviously is related to population, to immigration. How do you convince people swayed by One Nation’s anti‑immigration agenda, that immigration is one of the factors propping up the Australian economy?

How do you win that argument? I think what One Nation is proposing would be devastating for the economy in the near term and absolutely diabolical in the longer term – in the context of a population which is ageing and fertility rates which are falling faster than we anticipated even a few years ago – because people are taking the decision to have smaller families later in life.

I’m a bit different to Peter Costello in the sense that I don’t tell people how to make choices about how many kids they have, I see that as a deeply personal decision. But for us, there are a couple of important elements – early childhood education, paid parental leave, super on paid parental leave, that’s about making it easier for people to make the choice to start a family or have more kids if they want to.

But migration is really key here too, and migration is a force for good in our economy and in our society so long as it’s well managed, robustly and transparently managed. And that’s why I think the changes that Tony Burke announced Thursday of last week are just so important, because they are about normalising net overseas migration down to more appropriate levels.

We’ve already got it down almost 50 per cent from its peak a few years ago, that’s a good thing. But migration will continue to play an important role in our economy, just as it has in the decades to here, in the decades from here as well. But do you think that you’ve persuaded the Australian voters that that number, the net overseas migration number, that they will accept that it stays at that level, which is 235,000 longer term, 225 short term, 235,000 long term, have you won that argument?

Do you think? Well, I don’t think that argument is ever necessarily won or lost. From our point of view, we will continue to make the case for getting that net overseas migration down in the most responsible way that balances all of the key considerations in our economy and in local communities, making sure that the visa system is robust, the system broadly is transparent, and serving our national interest, including our national economic interest.

And from time to time, people raise concerns about the level of migration, that’s not necessarily an illegitimate thing that they raise to make sure that we get the settings right. But I think it’s really clear – any objective observer of the ageing of our population and falling fertility rates, and the way that our economy is likely to play out over the coming decades, any objective observer would conclude that we need responsible levels of migration robustly managed – that’s what we’re doing.

Our political opponents, actually both of our main political opponents, would absolutely trash the economy in the near term, and the impacts of their policies would be even worse in the longer term. It’s one of the many ways that any coalition or combination of One Nation, the Liberal Party, and the National Party would actually make Australians worse off. Whether it’s the damage they would do to our economy, whether it’s coming after superannuation, coming after wages – these are all the tangible differences between a responsible government governing from the centre and some of these far‑right alternatives.

But the latest Newspoll shows the government is failing to convince voters that you can get them through this difficult period that people are experiencing. How worried are you that this slide could be permanent? I’m focused more on different sets of numbers today, as I think you would understand.

But obviously, I’ve seen the reporting of some of those opinion polls. I think those polls reflect the simple fact that people are under pressure, and when people are under pressure, they express themselves through opinion polls and through the political system. We take that seriously because we know that once you acknowledge that there are cost‑of‑living pressures in our economy, the responsibility that we embrace is not just to acknowledge that, but to act on that.

And still, overwhelmingly, even on a day where we’re releasing an Intergenerational Report, the government’s primary focus is on the here and now, the inflation challenge putting pressure on people, the fact that petrol prices have come up because of the war on the other side of the world. That’s why we’ve got 5 different tax cuts, why we’re investing in more bulk billing because that takes pressure off families, higher wages.

Our whole cost‑of‑living agenda recognises that a lot of people are under the pump and we’re seeing that playing out in our politics as well. And just very briefly, Treasurer, we’re about to experience a major transfer of wealth from baby boomers to the generation beneath them. Are you considering some form of inheritance tax?

Just briefly, if you would. No, we’re not. But when it comes to intergenerational wealth, the most important thing we’re doing is reforming the housing market by reforming the tax system.

And I think if you look at the Intergenerational Report today, it validates, it justifies, I think in time it will vindicate some of the difficult decisions that we’ve taken to reform the tax system, to reform the housing market at the same time as we strengthen superannuation and address the risks posed by AI. In every page of today’s Intergenerational Report, is our important motivations for the government’s ambitious reform agenda at the same time as we address those cost‑of‑living pressures.

Treasurer, thank you very much indeed for joining us. Thanks so much, Sarah.