0:01

This is The Guardian. I'm

0:11

Brati Jabour, coming to you from Gadigal land.

0:14

And this is Full Story Newsroom

0:16

Edition. When

0:22

the leaves on the trees in Parliament Houses' forecourt

0:24

start to change, it can

0:26

only mean one thing. Budget

0:28

lock-up is almost upon us. And

0:31

for next week's federal budget, Treasurer Jim

0:33

Chalmers faces a unique set of

0:35

economic and social challenges. It

0:38

would not be wise when

0:40

people are doing it tough and

0:43

when the economy is soft for

0:45

us to slash and burn in this budget.

0:48

And he also needs to demonstrate that his

0:51

government's economic management is stronger than

0:53

the opposition's. The budget

0:55

is in much better nick than

0:57

the budget that we inherited almost

0:59

precisely two years ago. Today,

1:02

Editor-in-Chief Lenore Taylor and Deputy Editor

1:04

Patrick Keneally on how the government

1:07

tries to sell the budget. It's

1:10

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2:39

morning, Lenore. Morning, Bridie. Good

2:41

morning, Patrick. Morning. Next Tuesday

2:43

is the Albanese government's third

2:46

and possibly final budget before

2:48

an election. There's a whole lot of

2:50

rhetoric and maneuvering around the budget, which we

2:52

will get into. But first

2:55

of all, let's talk about what the lockup

2:57

actually is. Yeah,

2:59

it is a sort of an Australian-specific

3:02

tradition. I don't think they do it in

3:04

other places, certainly not in the UK, where

3:07

the media is locked up as

3:09

in has no access to

3:12

electronic communications at all for several

3:15

hours before the treasurer gets to his feet

3:17

at 7.30 to deliver the budget

3:19

speech. The ostensible reason

3:21

is so that market-sensitive information can

3:24

be digested. And then when the

3:26

treasurer gets up, the markets have

3:28

closed. I think a

3:30

likely reason is that the government of the

3:32

day wants us to have time

3:35

to read what is a lot

3:37

of material and think about it

3:39

and digest it before we immediately

3:41

start reporting it. And

3:43

also over time, it has

3:46

been sort of more constrained in

3:48

order to more manage the message.

3:50

So once upon a time, because

3:52

I have been doing these things for many, many

3:54

years, we could access

3:57

officials from other parties or interest groups in the

3:59

UK. the lockup. You can't do that now.

4:01

In fact, I think the press gallery is

4:03

locked up in their own individual rooms.

4:06

And we have a sort of secure

4:09

link to a lockup in Sydney where

4:11

we're editing the budget coverage. You basically

4:13

can't get anybody else's views or ideas

4:15

or thoughts on what's in the budget

4:17

before you start reporting on it. You

4:19

just have your own assessment

4:21

and reading of it. But before the

4:23

lockup, there aren't quite a few things

4:25

that we already know is going to

4:27

be in the budget because the government

4:29

has a narrative they're working to get out

4:31

beforehand, don't they? Yeah, the government is

4:34

continually in the lead up to the budget,

4:37

either making announcements publicly

4:40

or there's a whole series of either

4:42

leaks or drops out to media.

4:45

Mostly drops. Mostly drops, yeah. There's many

4:47

more drops for leaks. I think they

4:49

sometimes like to think they're leaks, but

4:51

they're really just drops, which are what

4:53

journalists call pretty much information that's just

4:55

given from the government to a

4:58

journalist, a favorite journalist often. And

5:01

sometimes it might go to Channel 9, sometimes it might

5:03

go to Sydney Morning Herald, sometimes it might come to

5:06

us. But they do it in a

5:08

way that they think they will get the best possible

5:10

publicity for their budget and different

5:13

policies and how they'll appear to the public. So

5:15

there's a whole lot of kind of dark arts

5:17

going on in there in media units within the

5:19

treasurer's office and prime minister's office, thinking, you know,

5:21

the presell of the budget, how can we get

5:23

all these pre-announcements out in a way that's going

5:25

to set the narrative for us and set us

5:27

up for success in the budget? Yeah. And

5:30

like Pat says, that is partly about making

5:32

sure they get maximum publicity for

5:34

each bit of the budget. But

5:36

it's also about corralling the message.

5:38

So they know that on

5:40

the night we're going to concentrate most on

5:42

the bits we didn't know about. So

5:45

they eke out some bits of it early so

5:47

that then on the night the bits that are

5:49

new are the bits that they really want the

5:51

media to focus on the most.

5:54

So it's sort of a message controlling thing.

5:56

And also, you know, they

5:58

are also thinking about the phrases. and

6:00

the terminology that they can use to

6:02

try to influence the messaging on the

6:04

night, influence those headlines. So a killer

6:06

line like Paul Keating's, this is the

6:09

one that brings home the bacon or

6:11

Peter Costello's one in 2002

6:14

when he wanted to focus on his baby bonus and he said,

6:16

you know, have one for mum, one for dad and one for

6:18

the country. Like they're thinking all the time

6:20

about how they can corral us to a point

6:22

where the picture we paint around the budget is

6:24

the one that they want us to paint. Sometimes

6:26

it doesn't go so well. Joe Hockey's the end

6:29

of the age of entitlement was his kind of

6:31

budget line. And I think that went down like

6:33

a lead balloon with most people. Yeah, that was

6:35

the 2014 budget. And

6:37

I think in that way, though, the

6:39

pre-messaging almost worked too well

6:42

in the first instance, in that lots of media

6:44

picked up on what the government

6:46

was saying, which was that, you know, this

6:48

was the fiscal medicine that Australia needed, whatever,

6:51

whatever. But the measures in

6:53

the budget were so harsh and so

6:56

difficult to swallow for most Australians that over

6:58

time, a lot of it came unstuck, came

7:00

undone. So, you know, I think that that

7:02

was an instance of they in most of

7:05

the media, not Guardian, but most of the

7:07

media, they got the message they wanted, but

7:09

the budget itself was so poorly constructed that

7:12

it came undone over time. So

7:14

what do we know is already in

7:16

this budget? So I think the centerpiece

7:18

of the budget and the one that the government has

7:21

really been keen to talk up is cost of living

7:23

relief. That's the main message they're trying to get out

7:25

of it. So they're talking about things like tax

7:27

cuts, changes to stage three, which would deliver

7:30

tax cuts to more Australians. There was also

7:32

the changes in we already know that they're

7:34

going to change the indexation rate for hex

7:36

and help debt, which was becoming

7:39

a really sore point for students.

7:42

We know defense spending is going to be

7:44

increased and rejigged. We know, I think

7:47

we also know a bit about what won't be there.

7:49

So we know there won't be or it

7:51

seems very unlikely that there'll be further changes

7:53

to job seeker levels. And,

7:56

you know, I think sometimes we

7:58

too easily accept. That

8:00

same thing is too expensive. But budgets are about

8:02

choices, right? And the government is making a

8:04

choice. Well, we think they're making a choice

8:07

to not increase job seeker, even though it

8:09

is below the poverty line in

8:11

a cost of living at crisis. But

8:13

there have been hints that maybe there would

8:16

be some adjustment to other allowances, like

8:18

rent assistance. And that could be for

8:20

both job seekers and use allowance. And

8:23

that would give the government something to say when

8:25

asked, what are you doing for the people who

8:27

are struggling at the most? I think the other

8:30

pieces that we know about the budget so far

8:32

is Jim Chum has been keen to say that

8:34

this will not be an inflationary budget. It won't

8:37

add to inflationary pressures, which is part of the

8:39

reason why they're saying things like, we just can't

8:41

add more to the job seeker payment at the

8:43

moment, why they're keen

8:46

to dampen down expectations at the

8:48

moment of spending. But there's

8:50

also a whole series of other smaller measures which

8:52

are inside the budget. And I say small, but

8:54

they're still often worth billions of dollars, like, for

8:56

example, the future made in Australia package, which is

8:59

a whole range of spending measures

9:02

from the government, including things

9:04

like quantum computing, minerals research,

9:07

and exploration. So yeah,

9:09

there's a range of measures that have been

9:11

dropped to the media so far. But

9:13

I think Pat's right that the

9:15

central point of analysis is going

9:17

to be whether the

9:20

budget adds to aggregate demand, whether

9:22

it is or is not inflationary.

9:25

Jim Chalmers insists he can put more money

9:28

into people's pockets and not add to

9:31

upward pressure on inflation. The

9:33

new RBA Governor Michelle Bullock says

9:35

she doesn't think government spending is

9:37

adding to inflation yet. But this

9:39

is going to be what's scrutinized. I

9:41

think it's going to be particularly scrutinized

9:44

because the coalition's spent decades claiming that

9:47

labor can't manage the economy. And

9:50

also really expounding

9:52

this idea that a budget

9:54

surplus now and forecasting to

9:56

the future is the measure of

9:58

a good treasure, is the BIO. and end all

10:01

and I feel like we would be

10:03

better served by slightly more sophisticated analysis

10:05

than that. I think that's also

10:07

why Jim Chalmers and others within the government see

10:09

this is really critical that they must come out

10:12

with either surplus or a very balanced budget because

10:14

they see there's a generational opportunity to change the

10:16

narrative away from what happened in the

10:19

GFC where they were attacked

10:22

by Tony Abbott quite effectively for his

10:24

so-called debt and deficit disaster. And

10:26

they see this as Labor has got

10:28

this one shot in government now

10:31

to completely change that narrative and

10:33

flip it and Labor become perhaps

10:36

once again, if you look at the Hawke heating years,

10:38

once again the party of better economic

10:40

managers and they see this as really

10:42

critical to the long-term survival and future

10:44

of the Labor Party. But

10:47

so much of that surplus argument is

10:49

BS, right? It really is nonsense and

10:51

that so much of the budget and

10:53

the budget situation is outside of

10:55

a particular government's control. I mean Peter

10:57

Costello, yep, he ran surpluses for decades

11:00

and paid off the Commonwealth government's debt

11:02

in part through spending cuts, yes, but mostly

11:04

because he had massive, massive soaring

11:07

commodity prices and more revenue coming in

11:09

than he knew what to do with. Some

11:11

budgets, he had so much money that he

11:13

just gave pensioners $500 for the hell of

11:16

it and said it was an energy bonus or some

11:18

such. Yep, he set up the Future Fund,

11:20

that was a good idea, but that could have

11:22

done a lot more to sort of future proof

11:24

the Australian economy then. And then

11:27

Wayne Swan and Josh Frydenberg, they both

11:29

ran deficits because they each faced a

11:31

huge economic shock, the GFC and the

11:34

pandemic. That was the right

11:36

time for government spending. They did the right thing.

11:38

And Chalmers is now benefiting from higher

11:41

commodity prices, international factors, which means revenue

11:43

estimates are going up and they're higher

11:45

than forecasts and I think he probably

11:47

will deliver a second surplus on Tuesday

11:50

and I think that's the right thing

11:52

for him. But I just,

11:55

I feel the idea of a surplus as

11:57

being the be-all and end-all measure of a

11:59

treasurer's college. or incompetence is, you

12:02

know, I don't think we should all swallow it. Craig

12:04

Emerson wrote an interesting piece to the ASR a while

12:06

back, looking at the last 50

12:08

years of budgets and how

12:11

Labor and the Coalition compared.

12:14

And really, when you look at it, there's actually very

12:17

little in it. Like he talked about the

12:19

overall tax take as a percentage of GDP.

12:22

Over the last 50 years, Labor's

12:24

been at 21.1% of GDP on

12:27

average, while the Coalition's 21.9%. The

12:30

Coalition's been higher taxing overall, but really 0.8%

12:32

is not much in it. When

12:35

you look at other measures, like

12:37

average spending as a percentage

12:39

of GDP, the Coalition's on

12:41

24.5% and Labor's,

12:44

you know, basically similar within 0.5% of the Coalition.

12:49

So, this narrative has

12:51

developed which doesn't actually relate very

12:54

closely to reality. To reality,

12:56

exactly. And also, I mean,

12:58

I do believe

13:01

and accept that if

13:03

governments have a revenue infold, if the economic times

13:05

are good, you know, they should put their budget

13:07

into surplus and they should start paying down debt.

13:09

Like that is the right thing to do. But

13:12

I really don't buy the argument that

13:14

balanced budgets in and of themselves, you

13:17

know, lead to a better society that, you

13:19

know, all boats rise or whatever they say.

13:21

I mean, we had decades and decades

13:23

of incredible economic growth in Australia, those

13:25

years when governments had money to burn.

13:28

And we still had rising inequality and really

13:30

entrenched inequality at the end of it. I

13:32

mean, was that really the best way to

13:34

spend our money? And, you

13:37

know, during that same period or sort

13:39

of after the GFC, other governments

13:41

went to sort of extreme austerity

13:43

measures in order to rebalance

13:46

their budgets. And that, A,

13:48

it was bad for their economies. It hollowed out the

13:50

middle class and there weren't any consumers to keep their

13:52

economy going. It was disastrous

13:55

for their political systems. That

13:57

level of inequality and that level of hardship led

13:59

to... the polarisation of politics

14:01

and repercussions that it's still reverberating.

14:03

So, I just think

14:06

the arguments need to be more

14:08

nuanced. We need to pull apart

14:10

the ideology that prevailed for a really long time and

14:12

think about it a bit. Which I think

14:14

is what we're going to be doing in lockup on

14:16

Tuesday. Along with a lot of jelly snakes. And

14:20

the media has a role to play in that

14:22

narrative, don't they? So, how does the media

14:25

choose what to cover and

14:27

how to cover the budget? I think different

14:29

parts of the media look at a budget

14:31

through different prisons. So, the News

14:34

Corp, particularly the Australian and probably the Finn

14:36

Review as well, have a pretty dry

14:39

economic view of things.

14:41

That colours how they report about something

14:43

like future made in Australia. They see

14:45

it as interventionist industry

14:48

policy, not a good

14:50

thing, picking winners. Perhaps Australia

14:52

would be better off just continuing to

14:54

buy manufactured goods from countries where

14:56

labour market costs are lower. The

14:58

government, as Pat said, sees it

15:01

as a strategic and an economic

15:03

imperative and they're not at all

15:05

ashamed or apologetic about it being

15:07

more interventionist. Although they say the

15:10

aim is to attract private capital

15:12

in a global race for private

15:14

capital for the energy transition in

15:16

particular. So, I guess

15:18

in some ways we look at a

15:21

budget through a more progressive lens. We're going

15:23

to report more from the perspective

15:25

of inequality and fairness. So,

15:28

there's a legitimate sort of different way

15:30

of looking at things. I think there's also

15:32

a responsibility to sort of dig behind the

15:34

narratives that he said, she said narratives of

15:37

the parties, which can sort of really dumb

15:39

things down. So, as we

15:41

touched on before, the lockup in Australia is

15:44

very unique. What do they

15:46

do in other countries when it comes to

15:48

the budget? Yeah, it is a bit of

15:50

a strange process in Australia that's developed over

15:52

decades. But Australia is not the only one

15:54

to have its own little weird quirks. Like

15:56

in the UK, for example, they have this

15:58

red leather. box, the budget

16:01

papers have to sit in, the chancellor

16:03

at the exchequer stands outside, I think

16:05

it's number 11 Downing Street where he

16:07

lives, or he lives and holds up

16:09

the red box and shows it around to the media

16:11

and they all take photographs of it before. But that's

16:13

not the only weird thing. There was another great one.

16:16

Apparently, it's the only speech throughout

16:18

the year in which the speaker

16:20

can drink alcohol while speaking. So

16:22

apparently Gordon Brown, of course, drank

16:24

mineral water while he was there,

16:27

but others have drunk things like

16:29

gin and tonic, Jeffrey Howe, Randy

16:31

and water, Benjamin Disraeli and Gladstone

16:34

liked to drink sherry with

16:36

a beaten egg, which is

16:38

great. It's completely great. I

16:44

never understand what's relaxing about drinking on the

16:46

job. Next,

16:49

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365 day returns. What

18:10

was it for you this week, Patrick? So the

18:13

federal government is not the only one to issue

18:15

a budget around this time of year. The

18:18

Victorian government's just released their budget in which

18:20

they again kick the can down the road

18:22

on building a rail link to Melbourne Airport,

18:24

partly because there's this ongoing fight

18:27

between the Victorian state government and

18:29

the Melbourne Airport Corporation over whether

18:31

the train station should be

18:33

above ground or below ground and the airport wants it

18:36

below ground, which would cost much more money. So

18:38

instead, the Victorian treasurer said, oh, well, if you

18:40

don't like this proposal, we'll just build a rail

18:42

line to Avalon Airport, which is like three times

18:45

as far and will cost way more money. Very

18:48

funny tactic, I think. And I think Melbourneites would

18:50

be pretty annoyed if the

18:52

wrong airport got a rail link before,

18:55

you know, the one that's actually much closer to the city

18:58

every time we take a flight to Melbourne and you have

19:00

to get on Skybus and go into the city. I think,

19:02

God, this is like Australia's most popular

19:04

city and it's a joke. Anyway, I

19:07

disagree. We've had this argument. I

19:09

know you like the right. I know you like the

19:11

Skybus. But what is wrong with the Skybus? It's just

19:13

so much more efficient. They don't get caught in traffic.

19:16

It's funny. You get on the Skybus. It dumps you

19:18

in the middle of the city. I see no problem with

19:20

the Skybus. Readers are welcome sending letters

19:22

of support of the Skybus. I

19:25

know my viewers are minorities. Moving

19:27

on from the Skybus, Lenore, what can't

19:29

you get out of your head? Something

19:32

altogether more depressing. Guardian

19:35

in the UK or Guardian around the world actually asked 380 of

19:37

the world's leading

19:39

climate scientists what they felt about

19:41

the future. The resulting

19:43

story is, I've got to say,

19:46

very hard to read. 77

19:49

percent of those 380 top

19:51

climate scientists think global temperatures will reach

19:53

at least 2.5 degrees

19:55

Celsius above pre-industrial levels,

19:58

which is a desire. It's

20:00

a complete disaster. Almost

20:02

half think it'll be more than three degrees

20:05

Celsius and only 6% of them think that

20:08

the 1.5 degrees Celsius limit, which

20:10

is what's in the Paris Agreement,

20:12

will be achieved and they

20:15

describe how terrified they are

20:17

and it's really not easy

20:19

reading but I think it's essential reading. Yes,

20:22

I had to brace myself before I clicked on

20:24

that headline. Yeah. Thank you

20:26

so much for joining me this week,

20:28

Lenore. Thank you, Brady. Thank you, Patrick.

20:31

Pleasure. That's it

20:33

for today. This

20:36

episode was produced by Camilla Hannon

20:38

and Joe Kony. The executive

20:40

producer is Miles Martagnone. If

20:43

you enjoyed this episode, you can subscribe to Full

20:45

Story where you can also leave us a

20:47

rating and review. I'm

20:50

Brady Givore and we'll be back with a

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new episode of Full Story on Monday.