Television interview - Sunrise

NAT BARR, HOST: Joining us now is Prime Minister Anthony Albanese. Good morning to you.

ANTHONY ALBANESE, PRIME MINISTER: Good morning, Nat.

BARR: This is being labelled a budget of broken promises. Can Australians still trust the things you say?

PRIME MINISTER: This is a Budget of reform and resilience. It is making sure that the Australian dream of owning your own home isn't out of reach for this generation of younger Australians, but of future generations to come. We have changed our position. I'm up front about that. And we'll own that and we'll argue why that's the case. We've been throwing everything at housing supply and at addressing what is the biggest issue, I think, facing younger generations, the issue of housing. But it hasn't been enough, which is why we've made this decision. Importantly, we're grandfathering the changes. So, if you've got existing arrangements, they remain in place in terms of negative gearing. But the difference between negatively gearing a new home and an existing home is that you can still invest to boost your income and wealth, of course, but by investing in a new home, what you're doing is investing in Australia as well as your own future wealth.

MICHAEL USHER, HOST: PM, the voters need to trust you, though. And you were very adamant before the election that these changes were off the table. Just have a listen to this. [CLIP] Well, PM, look, you've told me a few times you're a conviction politician, but you didn't have the conviction to take this to the voters, if we're very fair about it. So, let's get you on the record here. You've backflipped on property tax. Are you now considering a death tax?

PRIME MINISTER: No, we're not. And we have changed our position on property issues because we want 75,000 additional young Australians to be able to access their own home, that security that comes with having a roof over your head.

USHER: I appreciate that, but you knew that before the last election a year ago, none of the big factors have changed that much in the last year.

PRIME MINISTER: Well, what has changed is that increasingly it became obvious that everything that we were doing was not enough. So, we are throwing everything at this. It will make a difference for younger Australians. We're making sure, as I've said, that we're grandfathering the changes. So, if you have a negatively geared property at the moment, no change for your existing arrangements. That's the right thing to do. We've been criticised for doing that, saying it doesn't go far enough, but I think that's the right thing to do, getting the balance right. But we're also saying we're not going to sit back and just kick this can down the road again when we know that we need to do something to get those 75,000 additional people into a home.

USHER: A lot of feedback.

BARR: Yeah, we're getting lots of messages, aren't we? Here's one from Lee. He says, Mr Albanese was able to build his property portfolio through negative gearing. He's taken the opportunity away from young people to do what he did. What do you say to that?

PRIME MINISTER: That we haven't. They can invest in a new build.

BARR: But not in existing property.

PRIME MINISTER: No. They can invest in a new build, though. And what they'll be doing is not just helping to build their own portfolio, they'll be helping to build homes that other young people will be able to move into and rent, and it boosts supply as well. So, they'll be able to do that in exactly the same way. They can even choose the old system of capital gains of a 50 per cent discount if they choose to do so.

USHER: But that's a very different - I mean, there's a very heated, very, very heated property market from when you were able to invest and use negative gearing, like a lot of politicians have used negative gearing. It's a very different market right now, you'd have to concede, PM

PRIME MINISTER: It is. That's the whole point of why we're making this change. You've just said it's a very different market. That's the point. We need to drive supply. This measure along with the other measures that we have, the $2 billion for infrastructure, the additional sewerage or energy or the extra kilometre of road that's required to boost supply. We're throwing everything at this to make a difference, because it has got tougher. That's the whole point. As time has gone on, it's got tougher and tougher for young people to enter the housing market. That is why we're making that change.

USHER: There's no doubt about that. Let me just ask you about spending and inflation. Let's get some big picture here. You had the RBA warn you not so long ago with the last interest rate rise, that the Government's got to be checked on spending here to try and keep inflation down. I'm having a look at what you're saving. The NDIS, for example, $37.8 billion. But it looks like in other spending, you've got about 80 per cent of that spent. You know, $18 billion in extra spending. Defence, PBS, Services Australia. What has the Government done here to actually keep a check on its spending to keep a lid on inflation, which is predicted to be 5 per cent by the middle of the year, 7 per cent if oil keeps going through the roof?

PRIME MINISTER: Well, we've got $64 billion of savings in this Budget. In addition to the -

USHER: But that's over many, many years, Prime Minister, isn't it - that's not immediate and the immediate pressure is inflation and interest rates rising.

PRIME MINISTER: Now, this is a responsible Budget where we have banked every additional dollar of upgrade in revenue, whether it be for, as we did in MYEFO at the end of last year as well - that's the first time ever that a government has banked revenue upgrades for two economic statements in a row over a period of time. What we've done since we came to office, debt is $173 billion lower than the one that we inherited.

USHER: But the $64 billion you're talking about in savings, over how many years is that?

PRIME MINISTER: Well, the $64 billion in savings is across the Budget period. And what we've done is make sure that there's more than 150 different savings measures in this budget. More than 150. We went through -

BARR: But what if you can't save $37 billion in the NDIS? No government has been able to save that much. I mean, it's very ambitious and people say we need to change. But what if you can't save nearly $40 billion from the NDIS? This is, this is contingent on that.

PRIME MINISTER: Well, look at our record, Nat. When we came into office, the NDIS was growing at 22 per cent a year. We've got that down to 10 already. With the measures that we've put in place, we know we can get it down further. We've provided in addition to that through Thriving Kids. We're saying we don't want people to be left behind here. We're making sure that measures are put in place so that the NDIS operates the way that it was supposed to when it was introduced.

USHER: All right, Prime Minister, as you and the Treasurer have said, you know, big reforms in there, and certainly had a good look at CGT, negative gearing, all things that probably need to be addressed. You didn't tell us about it at the election, but you've done it now. We'll just see how young people respond because they desperately need to get into housing markets.

PRIME MINISTER: Well, I think it's not just young people. The people who raise it with me are parents and grandparents who are really worried about their young ones coming through.

USHER: That's a genuine worry.

BARR: It is. Across Australia.

PRIME MINISTER: And we're doing something about it, Nat, that's the point. You're elected to govern, to make hard decisions. We expected, I knew there'd be a bit of blow back on this. I understand that, you know, I'll put why we're doing it, but gee, it's the right thing to do.

BARR: Well, 94 seats and two and a half years before an election, you can afford to run the risk, can't you? Thank you very much.

USHER: Thanks, Prime Minister.

PRIME MINISTER: Thanks very much.