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December 18, 2025
MELISSA CLARKE: We have James Paterson, the Shadow Finance Minister, joining us and acting Shadow Treasurer at the moment. James Paterson, welcome back to Radio National Breakfast.
SENATOR JAMES PATERSON: Good morning, Mel.
MELISSA CLARKE: Jim Chalmers has said that the story of this mid-year budget update is one of delivery and responsibility, that they've been able to deliver improvements to the budget bottom line over the years ahead. Is that the sort of responsible economic management that the Coalition has been calling for?
SENATOR JAMES PATERSON: No, it's not. The key test for Jim Chalmers and Katy Gallagher in MYEFO was did they do everything they could to take the pressure off rising inflation, and they've failed. And you don't need to take my word for it, one of Australia's most respected independent economists, Saul Eslake, is quoted in the Financial Review this morning saying they've done nothing to make Michele Bullock's job any easier. The truth is, inflation is above the band and rising, and there's a very real risk, if you listen to the Commonwealth Bank or the National Australia Bank, that interest rates will rise next year, and if that happens, that will be a body blow for Australian families. The reckless spending we've seen under Labor since they came to office has only continued and is making that problem worse.
MELISSA CLARKE: One of the key things the Coalition has been calling for is reducing the size of public spending as part of that, the size of the public service. The government has found $6.8 billion in savings from the public service in this budget. Isn't that the kind of approach that you have been calling for?
SENATOR JAMES PATERSON: Well, they have claimed to have found those savings. Let's see whether they actually deliver them in practice, because this is a government which often says they'll find savings in contractors and outsourcing and expenses, but then often fails to actually deliver it in practice and often spending on those things are higher than they promised they would be. So let's see what they actually delivered. But let's look at the numbers that are actually in the budget. Government spending will rise in real terms by 4.5% this year. That's about twice the rate of economic growth. Government spending will remain the highest proportion of the economy for about 40 years outside the pandemic. The deficit is going to be three times larger this year than it was last financial year. And since they came to government, they've added $110 billion of net spending decisions. Now, all of those things put upward pressure on inflation and increased the risk of interest rate rises.
MELISSA CLARKE: So, when it comes to those spending pressures, much of what has increased since the last budget update we had is things like extra spending on the age pension, on veterans' entitlements, areas like natural disaster relief. Are those areas that you think should be cut back in the effort to try and get to a more sustainable payment level?
SENATOR JAMES PATERSON: No, some of those things are things which should happen, and no one would propose not happening. But actually, the decisions made by the Albanese government, the active policy choices they've made, are what have worsened the budget bottom line by $110 billion since they came to office. And what previous governments did is they had fiscal rules in place, which said, of course you can provide for new spending, but you have to offset that new spending. And actually, had the Albanese government had this discipline, they could have had a budget surplus last year, and they could have had a budget surplus this year. This year, $38 billion of net decisions made by this government take effect, and that could have turned a $37 billion deficit into a $1 billion surplus.
MELISSA CLARKE: You're listening to Radio National Breakfast, and my guest is the Shadow Minister for Finance, James Paterson. If I can turn to the Bondi terror attack and the response to those events on Sunday, you're part of the opposition's new Antisemitism, Extremism and Counterterrorism task force, which has met for the first time this week. Can you explain what this task force in opposition will do?
SENATOR JAMES PATERSON: The task force is about taking action. It's about addressing the inaction and delays under the Albanese government over the last two and a half years on antisemitism. As an Opposition, we can't do everything, but one thing we can do is help the government take the steps it needs to take. And the most glaring and obvious one is their failure to respond to the antisemitism commissioners' report. Jillian Segal was appointed by the Albanese government, handed down recommendations to them five months ago, and they're still yet to formally respond. And many of those things are things which could make our country safer, and particularly make the Jewish community feel safer.
MELISSA CLARKE: Jillian Segal has said that the government has been working with her in this time, but now she would like to see that accelerated. So it's not that they haven't responded at all, they just haven't given a formal response and haven't moved on some of the recommendations. That's a fair assessment.
SENATOR JAMES PATERSON: Jillian Segal is being appropriately diplomatic, as she should as a government appointee, but I can be more critical. And when you look at the list of recommendations that she has made, almost none of them have been actioned by the federal government. No legislation has been introduced by the government in response to recommendations that Jillian Segal made. And they are now saying they will accelerate the implementation. I really hope they do, and we will hold them to account if they don't, because the Australian Jewish community has been warning for two years that an event like this would happen and they feel outraged and angry that their warnings have been realised, that they've been vindicated in a terrible and perverse way.
MELISSA CLARKE: Labor's former Attorney-General, now backbencher Mark Dreyfus, has suggested it would be worthwhile re-looking at the hate speech laws that were updated earlier. There's also discussion at a state level about what might be done around protests and limiting protests. Are they initiatives that the Coalition would support?
SENATOR JAMES PATERSON: Yes, we're happy to look at all of the above. I'm particularly concerned about the way in which incitement to violence laws have not been adequately enforced. Over the last few years, we have had hate preachers inciting violence against the Jewish community who have got off without any consequences at all, and factories of hate like the Al Madina Dawah Centre in Sydney, which have been openly fermenting violence, in my view, against the Jewish community that have not been shut down, and they should be.
MELISSA CLARKE: You see that as an enforcement issue, though? Not an issue with the law as it's drafted or the reach of the law that is drafted, you see it as an enforcement issue?
SENATOR JAMES PATERSON: It may well be both. If legislative changes are necessary to allow better enforcement, then we're up for that conversation. But I also don't think that the government has lent in hard enough on testing these laws and making sure they are enforced. And I have to say, I was absolutely flabbergasted to hear Tony Burke and Jim Chalmers say, ‘we can't have a Royal Commission because that might delay action.’ Well, firstly, you can act and have an inquiry at the same time. And secondly, the only thing the Albanese government has done for the last two years is delay action. So for them to use that as an excuse now for not getting to the bottom of how this happened, I think, is a disgrace.
MELISSA CLARKE: If you have a sense of what should be done now and you see the special envoy's report as a blueprint for that, does the Royal Commission risk duplicating a plan that has already been developed by the specialist in this space?
SENATOR JAMES PATERSON: No, not at all. We need to have a Royal Commission because only a Royal Commission can identify whether or not operational failures occurred here. A Royal Commissioner has the power to get behind and look at the intelligence and policing issues. There may well have been no operational failures, but we won't know until we get to the bottom of that, and there may well have been policy failures as well, and Royal Commissions are very powerful at elucidating those issues. This is the worst ever terrorist attack in Australian history. We have had royal commissions about much more trivial matters than this, and I think it is the bare minimum we should expect from the government.
MELISSA CLARKE: As well as calling for a Royal Commission, your former colleague, former Liberal Treasurer Josh Frydenberg in speaking yesterday, put blame and responsibility directly at the feet of the Prime Minister. Do you agree with Josh Frydenberg that the Prime Minister has a level of personal responsibility here?
SENATOR JAMES PATERSON: Josh gave an incredibly powerful speech yesterday. I was there as he was concluding his speech, and I spoke to him immediately afterwards, and it was incredibly well received by the members of the community there. Josh was speaking as a Jewish Australian and as a leader of the Jewish community in Australia who's been so vocal over the last two years and so I absolutely understand his anger and frustration and can I tell you, as someone who's spent the last few days with the Jewish community in Melbourne and Sydney, it is a sentiment which is overwhelmingly shared by the Jewish community.
MELISSA CLARKE: Is it a sentiment you share that the Prime Minister has a level of personal responsibility?
SENATOR JAMES PATERSON: Look, I won't use the exact same language as Josh, I'm not a Jewish Australian, but I understand why he and many others feel that way. And I am frustrated that the warnings that was given to the Albanese government by the Jewish community, by security experts, and the Opposition, weren't heeded and that more action hasn't taken place. I think the Prime Minister must step up now and lead. The time for rhetoric, and empty platitudes, and talking points is over. People are sick of it. They want action, and they want to make our country safer, and he's got to step up and do that.
MELISSA CLARKE: James Paterson, thank you very much for joining me this morning.
SENATOR JAMES PATERSON: Thank you.
ENDS