THURSDAY, 9 MARCH 2017
SUBJECT/S: Turnbull Government risking AAA rating; $50 billion big business tax cut; Liberals’ capital gains tax division; WA election campaign costings; Pauline Hanson doing over Queensland on GST; Hanson and Malcolm Turnbull supporting penalty rates cuts; Kate Ellis; ABCC
JIM CHALMERS, SHADOW MINISTER FOR FINANCE: There's a few issues to cover today. I'll respond to the Prime Minister's speech about the AAA credit rating, also the capital gains tax debacle on the Liberals' side and some issues out of the WA state election before I take your questions.
The AAA credit rating is crucial for Australia because if it's lost by Malcolm Turnbull and Scott Morrison it means that mortgage repayments will go up, and it means that business and consumer confidence will be smashed in our economy. That AAA credit rating was won from all three rating agencies under the last Labor Government. And if it's lost by Malcolm Turnbull and Scott Morrison, they'll have nobody to blame but themselves. Under Scott Morrison and Malcolm Turnbull and Tony Abbott and Joe Hockey, we've seen this year's deficit triple and we've seen debt blow out by more than $100 billion. This is the record of this Liberal Government in Canberra. There are Budget blowouts as far as the eye can see and that's why Australia's coveted AAA credit rating is at risk. Labor is doing our bit. We are agreeing with savings where we can and where we oppose measures, because they attack the most vulnerable people, we are pitching up alternative savings that the Government is welcome to pick up and run with. We call on the Government to spend less time pretending that the Budget blowouts are Labor's fault and more time adopting Labor's sensible alternative savings, which will help lock in that AAA credit rating, which is so important to Australians, to their mortgage repayments and to confidence in our economy. If the Turnbull Government was serious about locking in the AAA credit rating, they wouldn't be proceeding with a $50 billion tax cut for big business, which includes a $7 billion tax cut for just four big banks. They would ditch that $50 billion tax cut immediately. They would pick up and run with Labor's sensible alternative savings and they would secure that AAA credit rating.
One of Labor's sensible proposals is to change the arrangements for capital gains tax to halve the discount for capital gains tax in this country, in conjunction with our proposals for negative gearing. On the Liberals' side we see again in reports today that they can't get their act together on capital gains. Watching the Liberal Party trying to come to a position on capital gains is like watching a three-ring circus. You've got all of these clowns riding around on unicycles trying not to collide with each other. You've got the Finance Minister Mathias Cormann ruling out any changes to capital gains; you've got Scott Morrison with an open mind on changing capital gains and you've got a divided backbench calling the shots. This is no way to put together a Budget. It's time for them to end this division and end this farce on capital gains and pick up and run with Labor's sensible policy, which we announced two years ago now, which would contribute to the effort to lock in Australia's AAA credit rating and would end all of this division and all of this dysfunction on the Budget and on tax on the Liberal side.
On Saturday, there will be an election in Western Australia. I wish Mark McGowan and Ben Wyatt and all of the team all the very best. There was an extraordinary revelation yesterday, with the release of the costings of the Liberal Party proposals. What was revealed yesterday was that last week, Mathias Cormann, the Federal Finance Minister, wrote secretly to the Liberal Party to commit another $300 million for the controversial Perth Freight Link network, bringing $300 million into the forward estimates of the federal Budget - without explanation, without coming clean with the people of Australia or the people of Western Australia. An extraordinary intervention which only came to light because of the release of the costings yesterday when we saw that $300 million buried amidst all of the other costings released by the Western Australian Treasury. We call on Mathias Cormann to explain immediately this intervention at the 11th hour in the WA election campaign; his attempt to save a tired and dying Government from defeat in just a couple of days' time. He owes it to the Australian taxpayers to come clean and to convince them that this isn't some kind of dodgy deal between the federal Liberals and the WA Liberals to try to save Colin Barnett's skin. We're talking about $300 million, this is a serious amount of money. It has gone unexplained so far by Mathias Cormann. The time has come for him to come clean and to answer the questions that have been raised in WA and elsewhere about this reallocation of federal money.
Over to you.
JOURNALIST: Surely the Prime Minister has a point though that it's beholden on Labor to take a bipartisan approach to protecting the AAA rating?
CHALMERS: The Prime Minister makes that point at the same time as he goes out of his way to point the finger at everybody else over the fact that he and Scott Morrison and his predecessors have been the ones who have jeopardised that AAA credit rating. We are doing our bit on the Labor side. We have agreed to swathes of savings which we consider to be fair but we will not agree to the Liberal plan to ask the most vulnerable people in our country to carry the can for the Liberal Party's Budget failures at the same time as they give a $50 billion tax cut to multinational corporations; at the same time as they give $7 billion to just four big banks. That is an act of fiscal vandalism that the country cannot afford. So he should spare us the lectures about bipartisanship. We are doing our bit. We are being more constructive than any Opposition in memory - supporting where we can, opposing where we must and pitching up alternative savings to help the Government fix this mess they've made of the Budget, which has seen the deficit triple and net debt blow out by more than $100 billion, which is what's putting pressure on the AAA credit rating, with big consequences for Australians in our neighbourhoods.
JOURNALIST: We're talking about Budget measures from 2014 that still haven't passed. What hope does this year's Budget have and is this why Australians are getting disillusioned with both major parties?
CHALMERS: I think Australians accept that the job of an Opposition is to support that savings that we can, to oppose the savings that we must and to pitch up alternatives where that's possible. I think if you look objectively over the last few decades of Australian politics, this Labor Opposition has done more than anyone else to pitch up alternative savings to help repair the Budget, to help the Government out of the mess that they've made of the Budget and to try to lock down Australia's AAA credit rating. And I know this about what Australians expect: they do not expect a Government to support cuts to the take-home pay of low-income workers at the same time as big business gets a $50 billion gift. They expect that if the Government wants to ask vulnerable people to tighten their belts, they should not be doing that at the same time as they shovel $50 billion in the direction of multinational corporations.
JOURNALIST: Are you heartened that there's been reports in the last couple of days that the Government is looking at negative gearing again? Would you encourage them to look a bit further?
CHALMERS: Tax policy on the Liberal side in Canberra is a farce. It's a circus. It is quite extraordinary to watch them bag the Labor Party for measures that they say privately that they might then adopt. The time has well passed for them to end this farce and end this debacle; to agree to the changes that Labor has proposed to negative gearing, supported by experts, supported by economists; to pick up our changes to capital gains at the same time to help lock in that AAA credit rating; and to end that sort of dysfunction and division, which sees everyday a different story in the newspaper about whether they're for or against changes to capital gains. This is creating extraordinary uncertainty out in the community. Labor's position has been well known for a couple of years now. We all know it's the right thing for the economy and for the Budget and they should pick it up and run with it. They should stop trying to play political games. They should stop disagreeing with each other in the pages of newspapers on background and get this done in the interests of the country.
JOURNALIST: Just to go to a different tax, the GST. Revelations in the last day or two - Pauline Hanson has been in favour of seeing Queensland get a cut to their GST to bail out WA. Is she failing Queenslanders as our Senator?
CHALMERS: There's no question Pauline Hanson is failing Queenslanders as their Senator, arguing for less money to go to Queensland and more money to go to WA. This is a really extraordinary development. You'd be hard-pressed to find another Senator elected by a state arguing for that state to be done-over in the interests of another state. It's entirely reasonable for state governments to enter the fray and state oppositions to enter the fray and argue for a bigger share of the GST pie. But it's unprecedented as far as I'm aware for a Senator to make the case for another state against the interests of her own state. What Pauline Hanson doesn't understand and Malcolm Turnbull doesn't understand is that you can't go to one state and promise one thing and not fess up to the impact that would have on other states. This is a serious issue that requires serious consideration and collaboration. It's not something that should be done in duelling doorstops hoping that other states don't notice what you say when you visit Perth.
JOURNALIST: Does that mean that a future Labor Government would look at reviewing the GST carve-up between the states?
CHALMERS: We've got a Commission that does these formulas and does this work. We've always said, whether it's this issue or a whole range of other issues, we're always up for a conversation with state governments about the best way to do this. But what we won't do is, we won't fly into Perth and make a promise that we can't keep. We won't fly into other state capitals and pretend that giving them more of the GST carve-up doesn't have consequences for other states. This is a serious issue. It deserves better than the sort of slap-dash promise making that we see from Malcolm Turnbull and it deserves better than a Senator, elected by the people of Queensland, doing over her own electors in such a spectacular fashion.
JOURNALIST: Is that a sign that Pauline's populist message can only go so far before it comes unstuck?
CHALMERS: There's a whole range of things to say about the message that Pauline Hanson is putting out there. She would like to pretend that she is a friend of the battlers at the same time as she joins with Malcolm Turnbull in supporting a pay cut for low-paid workers; up to 700,000 Australians losing up to $77 a week. I would encourage Queenslanders and Australians to look very carefully, not just at who Pauline Hanson pretends to be, but what she supports. And right now she's joined at the hip with Malcolm Turnbull and the Liberals in supporting a cut to the take-home pay of up to 700,000 low-paid Australians. That's a change that we won't cop. If people want to know the difference between the major parties and between us and Hanson, there's no better example than us standing up for battlers in our community, particularly low-paid workers against the cuts to their penalty rates, which Malcolm Turnbull and Pauline Hanson both support.
JOURNALIST: Kate Ellis is retiring, which is a bit of a loss to Labor?
CHALMERS: It's a huge loss to Labor. It's a sad day actually. I consider Kate to be not just a friend, but really quite an extraordinary contributor to our party, to our Parliament, to the politics of the nation. Because Kate's so young, people forget that she's been there now for I think 13 years and if this runs full-term, we're talking about 15 years. So she's made an extraordinary contribution over the time. On a personal level, I'll be very sorry to see her go, when somebody's making the sort of contribution that Kate is making, it is a sad day. But also to know that she leaves for the very best of reasons that she's identified. Anybody who's got kids, and particularly little kids, knows that although these jobs are an extraordinary privilege and you do get the opportunity to do good for your community and your country, it is hard to be away from little kids. It is hard to come home late at night. So Kate has identified that as one of the reasons why she won't be recontesting her seat. Like all of my Labor colleagues, I wish her the very best. She will be really, really missed from the party room and from the Parliament and from the politics of our nation. She's got a little while yet to run and I look forward to marking her contribution at the appropriate time. But it's a sad day.
JOURNALIST: One last question. Just across town we've got hundreds of unionists who've walked off the job. They were warned yesterday that they could be in breach of ABCC laws now. Is this a sign of why we had to get tighter restrictions around it, to stop this sort of behaviour?
CHALMERS: The ABCC was an ideological attack on the labour movement since day one. I don't support unions or anyone in the workplace doing the wrong thing, and that goes for bosses as well. There were appropriate avenues to deal with behaviour which is illegal. We always considered the ABBC to be an unnecessary addition to those arrangements. As for the dispute that's on today and the rally that's on today, I'll encourage you to talk to the organisers of that, I'm not part of it.