1
00:00:05,320 --> 00:00:08,200
Speaker 1: From the Australian. Here's what's on the front. I'm Claire Harvey.

2
00:00:08,280 --> 00:00:15,440
Speaker 1: It's Tuesday, February three, twenty twenty six. Federal parliaments back

3
00:00:15,440 --> 00:00:19,040
Speaker 1: today and everything's all shook up, with the crumpled coalition

4
00:00:19,200 --> 00:00:23,440
Speaker 1: scrambling to reorganize their seating arrangements and Susan Lee bracing

5
00:00:23,520 --> 00:00:24,440
Speaker 1: for a looming.

6
00:00:24,120 --> 00:00:25,520
Speaker 2: Assault on her leadership.

7
00:00:25,880 --> 00:00:29,360
Speaker 1: We'll be following every development live at the Australian dot

8
00:00:29,400 --> 00:00:36,239
Speaker 1: com dot au. The Reserve Bank meets today and is

9
00:00:36,400 --> 00:00:39,480
Speaker 1: likely to push up the cash rate. That's because inflation,

10
00:00:39,800 --> 00:00:42,760
Speaker 1: fueled by government spending, is on the way back up.

11
00:00:43,120 --> 00:00:46,400
Speaker 1: Through the past year, Treasurer Jim Chalmers and Bank Governor

12
00:00:46,440 --> 00:00:50,599
Speaker 1: Michelle Bullock were optimistic that the economy was improving. So

13
00:00:50,920 --> 00:00:53,240
Speaker 1: how did they get it wrong? And who's to blame

14
00:00:53,360 --> 00:00:56,880
Speaker 1: for the rise that will cost average mortgage holders thousands

15
00:00:56,960 --> 00:01:12,960
Speaker 1: of dollars? That's today's story. Treasurer Jim Chalmers says it

16
00:01:13,080 --> 00:01:16,280
Speaker 1: all the time. The independent Reserve Bank.

17
00:01:16,440 --> 00:01:20,440
Speaker 3: The Reserve Bank has taken its decisions independently. Cut rates

18
00:01:20,440 --> 00:01:23,640
Speaker 3: are ready. I don't second guess decisions taken independently by

19
00:01:23,680 --> 00:01:26,399
Speaker 3: the Bank or it's board. I don't know that they've made.

20
00:01:26,440 --> 00:01:29,320
Speaker 3: I cherished the independence of the Reserve Bank and tain

21
00:01:29,360 --> 00:01:33,200
Speaker 3: the report are about bolstering the independence of the Reserve Bank,

22
00:01:33,360 --> 00:01:35,560
Speaker 3: not undermining that independence.

23
00:01:36,880 --> 00:01:40,160
Speaker 1: But is the central bank responsible for setting the cash

24
00:01:40,240 --> 00:01:43,040
Speaker 1: rate that determines how much it costs banks to obtain

25
00:01:43,160 --> 00:01:46,039
Speaker 1: money and therefore how much they charge us all in

26
00:01:46,040 --> 00:01:48,000
Speaker 1: interest rates? Really independent?

27
00:01:48,640 --> 00:01:52,240
Speaker 3: Jim Charmers says higher interest rates are smashing the economy.

28
00:01:52,600 --> 00:01:56,120
Speaker 3: Global economic uncertainty and higher interest rates are smashing household

29
00:01:56,160 --> 00:01:57,680
Speaker 3: budgets and slowing our economy.

30
00:01:58,080 --> 00:02:01,360
Speaker 2: Dr Chalmers is blaming the economic outlook on the RBA's

31
00:02:01,440 --> 00:02:02,440
Speaker 2: rate hikes.

32
00:02:04,400 --> 00:02:07,040
Speaker 1: When Jim Chalmers became Treasurer with the election of the

33
00:02:07,040 --> 00:02:10,280
Speaker 1: Albanzi government in May twenty twenty two, the cash rate

34
00:02:10,400 --> 00:02:13,520
Speaker 1: was zero point three five percent and the standard variable

35
00:02:13,600 --> 00:02:16,320
Speaker 1: rate for home loans was four point seven seven percent.

36
00:02:16,840 --> 00:02:20,880
Speaker 1: Then it went up and up twelve consecutive rises until

37
00:02:20,919 --> 00:02:24,440
Speaker 1: February twenty twenty five, then three cuts and a whole

38
00:02:24,480 --> 00:02:28,240
Speaker 1: lot of holding steady through the past year. Chalmers has

39
00:02:28,280 --> 00:02:31,040
Speaker 1: been quick to bask in the glory when the bank

40
00:02:31,160 --> 00:02:31,920
Speaker 1: cuts rates.

41
00:02:32,240 --> 00:02:34,280
Speaker 2: Thanks for your time, Gi, you must have been happy

42
00:02:34,280 --> 00:02:35,240
Speaker 2: when you got that news.

43
00:02:36,720 --> 00:02:39,000
Speaker 3: I was a pretty welcome decision by the Reserve Bank

44
00:02:39,000 --> 00:02:41,800
Speaker 3: because it means more money in the pockets of millions

45
00:02:41,800 --> 00:02:44,959
Speaker 3: of Australians who are still under pressure. It also means.

46
00:02:44,800 --> 00:02:47,640
Speaker 1: Even when the bank has held rates steady, like in

47
00:02:47,720 --> 00:02:50,960
Speaker 1: July twenty twenty five, the Treasurer has talked about it

48
00:02:51,000 --> 00:02:53,280
Speaker 1: as part of an overall downward trend.

49
00:02:54,240 --> 00:02:58,240
Speaker 3: But it is clear now the direction of travel on

50
00:02:58,360 --> 00:03:01,680
Speaker 3: inflation and on interest rates has been established.

51
00:03:02,680 --> 00:03:06,200
Speaker 1: And now he's insistent that b learning inflation isn't the

52
00:03:06,240 --> 00:03:10,240
Speaker 1: government's fault, that is ultra higher public spending isn't what's

53
00:03:10,320 --> 00:03:13,959
Speaker 1: causing the independent Reserve Bank to keep rates high or

54
00:03:14,000 --> 00:03:14,680
Speaker 1: push them up.

55
00:03:14,960 --> 00:03:17,079
Speaker 3: The Reserve Bank Governor has said on a number of

56
00:03:17,120 --> 00:03:20,360
Speaker 3: occasions now our budget is better than a lot of

57
00:03:20,400 --> 00:03:25,440
Speaker 3: other countries, and that a change in fiscal policy wouldn't

58
00:03:25,480 --> 00:03:28,800
Speaker 3: necessarily warrant a change in their approach to monetary policy.

59
00:03:28,800 --> 00:03:30,280
Speaker 3: And so I know that there'll be a lot of

60
00:03:30,360 --> 00:03:34,119
Speaker 3: political commentary about last week.

61
00:03:34,200 --> 00:03:38,160
Speaker 1: Inflation numbers came in higher than the government wanted, up

62
00:03:38,320 --> 00:03:41,160
Speaker 1: point four of a percentage point to three point eight percent,

63
00:03:41,520 --> 00:03:46,040
Speaker 1: and well above the Reserve Bank's target range. Matthew Cranston

64
00:03:46,200 --> 00:03:49,720
Speaker 1: is the Australian's Economics editor Matt The Reserve Bank is

65
00:03:50,160 --> 00:03:53,480
Speaker 1: widely tipped to put rates up when it meets on Tuesday.

66
00:03:53,920 --> 00:03:55,440
Speaker 1: If it does, who can we.

67
00:03:55,400 --> 00:03:59,560
Speaker 2: Blame, Claire? I think you can blame both the RBA

68
00:04:00,240 --> 00:04:03,720
Speaker 2: and governments and why because governments have been spending an

69
00:04:03,840 --> 00:04:08,080
Speaker 2: enormous amount and that has been driving up inflation. But

70
00:04:08,200 --> 00:04:11,040
Speaker 2: also you've got to blame the RBA too, because the

71
00:04:11,160 --> 00:04:14,440
Speaker 2: RBA has missed on a lot of its forecasts, whether

72
00:04:14,520 --> 00:04:17,360
Speaker 2: it's where it thinks GDP is going to go, or

73
00:04:17,360 --> 00:04:20,320
Speaker 2: where it thinks inflation's going to go, or unemployment for

74
00:04:20,320 --> 00:04:25,559
Speaker 2: that matter. So I think both have responsibility in where

75
00:04:25,600 --> 00:04:28,960
Speaker 2: inflation's gone because that's what's causing interstrates to go back up.

76
00:04:29,480 --> 00:04:32,480
Speaker 2: Who's to blame for inflation is the question, really, Claire,

77
00:04:32,800 --> 00:04:36,800
Speaker 2: And both the government and the RBA are responsible in

78
00:04:36,839 --> 00:04:40,160
Speaker 2: some ways for that. The RBA delivered three interstraight cuts

79
00:04:40,200 --> 00:04:44,240
Speaker 2: last year, which is very stimulatory to an economy, and

80
00:04:44,480 --> 00:04:47,159
Speaker 2: the government has been spending, at least the federal government

81
00:04:47,160 --> 00:04:49,840
Speaker 2: as well has been spending at a record amount, and

82
00:04:49,920 --> 00:04:52,280
Speaker 2: states governments as well have been spending in a lot

83
00:04:52,400 --> 00:04:55,279
Speaker 2: and that just drives inflation, and that's probably why we're

84
00:04:55,279 --> 00:04:57,400
Speaker 2: going to see a rate hike on Tuesday.

85
00:04:57,600 --> 00:05:01,200
Speaker 1: Yeah, there's two kinds of public spending. Government outlays on

86
00:05:01,320 --> 00:05:05,520
Speaker 1: pensions and welfare and public sector wages, and then there's

87
00:05:05,560 --> 00:05:09,000
Speaker 1: what they call public investment, which is spending on infrastructure projects,

88
00:05:09,040 --> 00:05:12,400
Speaker 1: big roads, big rail projects. Both of those are at

89
00:05:12,400 --> 00:05:14,800
Speaker 1: record highs at the moment. But the government has an

90
00:05:14,880 --> 00:05:18,160
Speaker 1: argument to defend both of those things, that it's not

91
00:05:18,240 --> 00:05:21,360
Speaker 1: got welfare out of control, and that those infrastructure projects

92
00:05:21,400 --> 00:05:23,560
Speaker 1: are part of the great growth in productivity that we're

93
00:05:23,560 --> 00:05:25,800
Speaker 1: all going to have. What's your take on both of

94
00:05:25,800 --> 00:05:26,360
Speaker 1: those things.

95
00:05:27,000 --> 00:05:30,240
Speaker 2: Well, the Treasurer keeps saying that government spending is not

96
00:05:30,279 --> 00:05:35,400
Speaker 2: contributing to the overall increase in GDP growth. That's not right.

97
00:05:36,279 --> 00:05:37,840
Speaker 2: You can just go on to the ABS and look

98
00:05:37,880 --> 00:05:40,560
Speaker 2: at the September quarter and you can see that public

99
00:05:40,640 --> 00:05:45,279
Speaker 2: demand did contribute, and it contributed both in expenditure. So

100
00:05:45,320 --> 00:05:48,200
Speaker 2: that's the things like you mentioned before, where you're just

101
00:05:48,600 --> 00:05:52,360
Speaker 2: spending to keep people employed or you're spending to buy materials,

102
00:05:53,200 --> 00:05:56,320
Speaker 2: and the other side, which is this investment. So it

103
00:05:56,400 --> 00:05:59,200
Speaker 2: keeps on pumping out money as well, especially in these

104
00:05:59,240 --> 00:06:03,520
Speaker 2: things called off balance sheet items. So for example, last

105
00:06:03,600 --> 00:06:06,600
Speaker 2: year they went and put money into all sorts of investments.

106
00:06:07,560 --> 00:06:11,240
Speaker 2: That's doing two things, as you say, the capital investment

107
00:06:11,440 --> 00:06:15,240
Speaker 2: and the spending, and that is contributing overall. And what

108
00:06:15,320 --> 00:06:17,400
Speaker 2: else does that do. It has the potential to do

109
00:06:17,480 --> 00:06:20,080
Speaker 2: what it's called crowding out and that means that the

110
00:06:20,120 --> 00:06:23,000
Speaker 2: private sector goes, oh, well, the government's beating us on

111
00:06:23,520 --> 00:06:26,640
Speaker 2: this contract or in terms of buying the things that

112
00:06:26,680 --> 00:06:30,520
Speaker 2: are needed for it, competing with resources and labor and materials,

113
00:06:31,160 --> 00:06:33,200
Speaker 2: and then the private sector doesn't grow as much as

114
00:06:33,240 --> 00:06:35,800
Speaker 2: it could. So private sector is still growing, but it's

115
00:06:35,800 --> 00:06:38,520
Speaker 2: not growing as much as it could. And it also

116
00:06:38,640 --> 00:06:41,919
Speaker 2: means that there's capacity constraints in the economy too. So

117
00:06:42,720 --> 00:06:46,440
Speaker 2: that's the answer is that, well people say it's not,

118
00:06:47,000 --> 00:06:49,359
Speaker 2: it is and you can see that just with the

119
00:06:49,440 --> 00:06:51,080
Speaker 2: last September quarter of data.

120
00:06:52,279 --> 00:06:55,680
Speaker 1: Jim Chalmers would say that on those big spending priorities,

121
00:06:55,720 --> 00:06:57,720
Speaker 1: you know, let's say the NDI is that the government

122
00:06:57,760 --> 00:07:00,320
Speaker 1: is trying to get spending under control, and that for

123
00:07:00,360 --> 00:07:03,960
Speaker 1: other priorities, let's say the Orcus nuclear submarine project, that

124
00:07:03,960 --> 00:07:07,240
Speaker 1: that's something that Australia just has to do. Where are

125
00:07:07,279 --> 00:07:10,400
Speaker 1: the most obvious areas that public spending is out of

126
00:07:10,440 --> 00:07:12,800
Speaker 1: control or is too high, or they haven't shown the

127
00:07:12,840 --> 00:07:13,920
Speaker 1: restraint that they've needed.

128
00:07:14,400 --> 00:07:18,080
Speaker 2: Well and diis they said only in the media budget

129
00:07:18,120 --> 00:07:21,160
Speaker 2: update in December was growing at ten percent and their

130
00:07:21,200 --> 00:07:24,320
Speaker 2: target was more like six percent. So Indy Ice is

131
00:07:24,440 --> 00:07:26,760
Speaker 2: one area that I think you wouldn't have too much

132
00:07:26,880 --> 00:07:30,960
Speaker 2: trouble trying to find some excessive spending on trying to

133
00:07:30,960 --> 00:07:34,320
Speaker 2: get what you need out of that service. Public sector

134
00:07:34,360 --> 00:07:37,760
Speaker 2: wages are pretty big. They fall through public sector wages.

135
00:07:37,800 --> 00:07:40,160
Speaker 2: That's an area where I think the bill has now

136
00:07:40,200 --> 00:07:43,800
Speaker 2: reached a record for public servants, the wage increases they get.

137
00:07:44,360 --> 00:07:48,040
Speaker 2: I think overall, though, there's this idea that the spending

138
00:07:48,120 --> 00:07:52,080
Speaker 2: doesn't contribute to inflation because it might not be as

139
00:07:52,160 --> 00:07:54,880
Speaker 2: big as it has been in the past, and that's

140
00:07:54,920 --> 00:07:57,400
Speaker 2: sort of true. The rate of growth in government spending

141
00:07:57,480 --> 00:08:01,640
Speaker 2: is sort of coming back down again. But I actually

142
00:08:01,720 --> 00:08:05,000
Speaker 2: just don't believe that they are going to show as

143
00:08:05,080 --> 00:08:09,080
Speaker 2: much fiscal restraint as they say they have. I think

144
00:08:09,120 --> 00:08:12,680
Speaker 2: a huge amount of the spending is actually discretionary. When

145
00:08:12,960 --> 00:08:17,160
Speaker 2: the Treasurer says that this spending is in what he said,

146
00:08:17,360 --> 00:08:21,280
Speaker 2: any reasonable person would call this necessary or essential spending.

147
00:08:23,160 --> 00:08:25,360
Speaker 2: And I think this is a really important point, Claire,

148
00:08:25,400 --> 00:08:28,880
Speaker 2: because it shows if you read the retoric of the

149
00:08:29,320 --> 00:08:32,800
Speaker 2: Treasurer on this point, it shows you that if they

150
00:08:32,880 --> 00:08:37,000
Speaker 2: think this is essential spending, then they're going to continue

151
00:08:37,200 --> 00:08:41,520
Speaker 2: that spending. And I think they actually believe that all

152
00:08:41,559 --> 00:08:42,880
Speaker 2: this spending is warranted.

153
00:08:45,800 --> 00:08:48,360
Speaker 1: For Jim Chalmers and Anthony Albanezi, I think the greatest

154
00:08:48,400 --> 00:08:53,640
Speaker 1: fear is spiraling unemployment. Michelle Bullok has had a similar

155
00:08:53,679 --> 00:08:56,240
Speaker 1: tune the governor of the Reserve Bank. She said that

156
00:08:56,400 --> 00:08:58,959
Speaker 1: her goal has been to avoid high unemployment.

157
00:09:00,160 --> 00:09:03,200
Speaker 4: The board strategy, as you know, has been to bring

158
00:09:03,240 --> 00:09:07,520
Speaker 4: inflation down while avoiding a sharp rise in unemployment. Because

159
00:09:07,520 --> 00:09:09,960
Speaker 4: we didn't take rates as high as some other countries,

160
00:09:10,040 --> 00:09:12,480
Speaker 4: it may be that we don't need to reduce rates

161
00:09:12,520 --> 00:09:13,280
Speaker 4: as much either.

162
00:09:14,840 --> 00:09:17,319
Speaker 1: Has she not been quick enough to push rates up?

163
00:09:17,800 --> 00:09:20,520
Speaker 1: And some of her critics would say that if that's

164
00:09:20,520 --> 00:09:23,800
Speaker 1: the case, that she is under political pressure from the

165
00:09:23,800 --> 00:09:25,600
Speaker 1: government or she's buckling to that pressure.

166
00:09:25,800 --> 00:09:28,480
Speaker 2: What do you think? Okay, So just there's two parts

167
00:09:28,559 --> 00:09:32,120
Speaker 2: that question. The first is around the employment. Really interesting

168
00:09:32,160 --> 00:09:34,720
Speaker 2: to know that a lot of the new employment and

169
00:09:34,760 --> 00:09:37,160
Speaker 2: what's got us down to this really low employment rate.

170
00:09:37,640 --> 00:09:41,319
Speaker 2: A lot of it has been public sector jobs. So

171
00:09:41,320 --> 00:09:43,880
Speaker 2: how do you get the public sector jobs through spending?

172
00:09:44,360 --> 00:09:47,320
Speaker 2: How do you do the spending through borrowing? And what

173
00:09:47,440 --> 00:09:50,720
Speaker 2: happens when global cost of debt goes up That means

174
00:09:51,559 --> 00:09:55,160
Speaker 2: younger people have to flip the interest bill in decades

175
00:09:55,200 --> 00:09:59,319
Speaker 2: to come. There's that first part of the question. Second is, yeah, well, look,

176
00:10:00,000 --> 00:10:01,560
Speaker 2: I've been in the US for four years and I

177
00:10:01,640 --> 00:10:06,160
Speaker 2: came back a year ago listening to the change in

178
00:10:06,200 --> 00:10:11,000
Speaker 2: the retric from the RBA governor and the relationship between

179
00:10:11,320 --> 00:10:15,000
Speaker 2: the treasure Jim Charmers, and I measured that against when

180
00:10:15,040 --> 00:10:17,320
Speaker 2: I was away. There was quite a lot of tension

181
00:10:17,640 --> 00:10:22,480
Speaker 2: around what Michelle Bullock was saying needed to happen, and

182
00:10:22,880 --> 00:10:25,000
Speaker 2: there was a little bit of rgie bargie, to say

183
00:10:25,040 --> 00:10:29,320
Speaker 2: the least, between Charmers and Bullock, and I think that

184
00:10:29,600 --> 00:10:33,760
Speaker 2: set a tone. And I interviewed Michelle Bullock in December

185
00:10:34,520 --> 00:10:37,520
Speaker 2: and I said to her, are you actually saying what

186
00:10:37,559 --> 00:10:41,440
Speaker 2: you need to say to inform the public about how

187
00:10:41,520 --> 00:10:45,079
Speaker 2: important the fiscal impulse is, the government spending is when

188
00:10:45,120 --> 00:10:48,000
Speaker 2: it comes to making your decision about where interest rates

189
00:10:48,040 --> 00:10:50,880
Speaker 2: should go. And she said, we had to do better.

190
00:10:51,480 --> 00:10:53,920
Speaker 2: So she's saying that the RBA has to do better

191
00:10:54,360 --> 00:10:58,040
Speaker 2: in explaining to the public the importance of government spending

192
00:10:58,080 --> 00:11:01,719
Speaker 2: and so forth. So I think maybe she's gone through

193
00:11:01,760 --> 00:11:04,760
Speaker 2: a lull of pushing back on charmers and you know

194
00:11:04,840 --> 00:11:08,440
Speaker 2: where rates should be and so forth, because obviously Chalmers

195
00:11:08,480 --> 00:11:11,040
Speaker 2: would love to see further interest rate cuts to keep

196
00:11:11,040 --> 00:11:14,640
Speaker 2: on fueling the economy, but she's now having to go, well,

197
00:11:14,720 --> 00:11:17,800
Speaker 2: we have to lift to make sure that inflation doesn't

198
00:11:17,800 --> 00:11:21,320
Speaker 2: get away from us. And I think maybe that easing

199
00:11:21,360 --> 00:11:24,040
Speaker 2: in the language is starting to just ever so slightly

200
00:11:24,080 --> 00:11:30,080
Speaker 2: maybe come back. And even though government spending growth is

201
00:11:30,400 --> 00:11:33,400
Speaker 2: slightly less than the growth it was before, and it's

202
00:11:33,400 --> 00:11:35,120
Speaker 2: sort of coming to a point where she might be

203
00:11:35,120 --> 00:11:37,959
Speaker 2: a little bit more comfortable, I still think she's going

204
00:11:38,000 --> 00:11:41,440
Speaker 2: to give some slight nudges about all governments, not just

205
00:11:41,480 --> 00:11:44,160
Speaker 2: the FEDS, but the states as well, in making sure

206
00:11:44,559 --> 00:11:47,880
Speaker 2: that the government spending is in control and doesn't contribute

207
00:11:47,920 --> 00:11:51,160
Speaker 2: to inflation which would force them to make even more

208
00:11:51,200 --> 00:11:57,560
Speaker 2: than one or two interestrate hikes.

209
00:11:58,040 --> 00:12:01,880
Speaker 1: Coming up. Housing is a big part of huge daily expenses,

210
00:12:02,360 --> 00:12:06,400
Speaker 1: so how we'll pushing up mortgages make anything better? That's

211
00:12:06,520 --> 00:12:25,000
Speaker 1: after the break. Finally, Matt, let's just talk about housing.

212
00:12:25,160 --> 00:12:29,280
Speaker 1: One of the mind bending parts of this inflation jigsaw

213
00:12:29,320 --> 00:12:31,880
Speaker 1: puzzle is that one of the big contributors to inflation

214
00:12:32,000 --> 00:12:34,960
Speaker 1: in January was housing. The cost of housing, and everyone

215
00:12:34,960 --> 00:12:37,320
Speaker 1: who's got a mortgage or is paying rent knows that

216
00:12:37,400 --> 00:12:41,160
Speaker 1: it is cripplingly high. A rise in the cash rate

217
00:12:41,280 --> 00:12:44,560
Speaker 1: will mean mortgage rates go up and housing becomes even

218
00:12:44,600 --> 00:12:47,520
Speaker 1: more expensive. So how do we get out of this spiral?

219
00:12:48,760 --> 00:12:52,120
Speaker 2: I know it sounds silly, but it's a very simple answer.

220
00:12:52,280 --> 00:12:56,080
Speaker 2: But it's just politically not workable, and that is you

221
00:12:56,200 --> 00:13:01,439
Speaker 2: have to boost supply side. Politicians fall in love with

222
00:13:01,559 --> 00:13:04,760
Speaker 2: demand side because it always looks as though they're giving

223
00:13:04,800 --> 00:13:08,760
Speaker 2: money to people and they're helping people, whereas supply side,

224
00:13:08,760 --> 00:13:11,720
Speaker 2: what you're doing is you're helping produce, and there are

225
00:13:11,800 --> 00:13:15,600
Speaker 2: fewer producers than there are consumers. Right, so you might

226
00:13:15,640 --> 00:13:19,760
Speaker 2: just have one property developer who sells to one hundred consumers. Right,

227
00:13:20,240 --> 00:13:24,640
Speaker 2: So it doesn't have the same political power as helping

228
00:13:24,679 --> 00:13:28,600
Speaker 2: the demand side. But the solution is the supply side

229
00:13:28,840 --> 00:13:32,480
Speaker 2: got to release more land, got to cut the regulations.

230
00:13:32,800 --> 00:13:34,880
Speaker 2: It's all the stuff that isn't that sexy and that

231
00:13:34,960 --> 00:13:38,120
Speaker 2: doesn't get big headlines and so forth, but it's the

232
00:13:38,160 --> 00:13:42,480
Speaker 2: stuff that actually helps increase supply so that you're not

233
00:13:42,559 --> 00:13:47,600
Speaker 2: really damaging house prices because we all want our homes

234
00:13:48,080 --> 00:13:51,280
Speaker 2: to be worth more and to not affect our wealth,

235
00:13:52,040 --> 00:13:55,240
Speaker 2: but also we want more homes so that people can

236
00:13:55,280 --> 00:13:58,880
Speaker 2: actually get started and move in. I mean, there really

237
00:13:58,960 --> 00:14:02,240
Speaker 2: is no other response way because everything else is demand,

238
00:14:02,720 --> 00:14:06,760
Speaker 2: and you're just throwing more money, which allows more people

239
00:14:06,800 --> 00:14:09,040
Speaker 2: to compete and bid each other up, and it makes

240
00:14:09,040 --> 00:14:12,439
Speaker 2: it harder to get in it's supply side, and until

241
00:14:12,480 --> 00:14:16,040
Speaker 2: the politicians brave enough to go down that avenue. I mean,

242
00:14:16,200 --> 00:14:19,360
Speaker 2: there are some things. Peter Chulick, the former RBA economists

243
00:14:19,400 --> 00:14:22,600
Speaker 2: now working at the Center for Independent Studies, He was

244
00:14:22,640 --> 00:14:24,600
Speaker 2: saying that what you should do is sort of ramp

245
00:14:24,680 --> 00:14:29,320
Speaker 2: up reward payments to the states who can make sure

246
00:14:29,440 --> 00:14:32,960
Speaker 2: that they are boosting supply side through measures such as

247
00:14:33,480 --> 00:14:37,720
Speaker 2: expediating approvals and so forth. So that's sort of interesting.

248
00:14:38,360 --> 00:14:41,160
Speaker 2: The government does have a mechanism to do that, where

249
00:14:41,200 --> 00:14:44,640
Speaker 2: they give more money to the states who meet their

250
00:14:44,680 --> 00:14:46,640
Speaker 2: goals in delivering housing supply.

251
00:14:52,040 --> 00:14:53,680
Speaker 1: Matthew Cranston, thank you very much.

252
00:14:54,520 --> 00:14:59,200
Speaker 2: Thanks Claire, you can read.

253
00:14:59,000 --> 00:15:02,560
Speaker 1: Maths journalism and follow our live reporting and analysis of

254
00:15:02,600 --> 00:15:05,880
Speaker 1: the Reserve Bank decision and all the fallout live at

255
00:15:05,960 --> 00:15:08,080
Speaker 1: the Australian dot com dot au