ALAN JONES:
I have been around, as they say in the Scent of a Woman, “I have been around, you know”. I don’t think I have ever heard anything worse in delivery or content as I did last night from the Opposition Leader, Bill Shorten. In terms of both, delivery and content, just have a listen to this will you, this was part of the speech:
BILL SHORTEN:
Does it return Australia to trend growth this year, in future years? No. Does it smooth the transition of our economy? No. Does it deal with the challenges of the digital age and the new skills and jobs that we need? No. Does it deepen our engagement with Asia? Does it help older Australians live in comfort? Does it advance the equal treatment of women? Does it tackle climate change? No, no, no and no.
ALAN JONES:
Oh boy. At that point I was nearly chucking something at the TV. It is instructive none the less to read the comments – I’ll talk to the Prime Minister in a moment – by Peter Strong, the Chief Executive of the Council of Small Business Australia about the Budget. Yesterday he said in part, “this is a ground breaking Budget. It could be truly called a small business Budget. I have been effusive in my praise of the Budget in various media. This worried me. Advocates don’t really want to be seen as too over the top in praise but I checked with our members and they agreed with the effusiveness. One even said I was understating the fact,” said Peter Strong the Chief Executive of the Council of Small Business Australia. “The announcement of immediate deductibility for each asset purchased up to $20,000 is as unexpected as it is welcome. It will provide motivation to people who want to start a business, those who want to expand their business and those who want to replace old machinery and stock. This in turn will mean an increase in employment opportunities. This is what governments and communities want.” He said the five per cent tax discount for unincorporated small business is another highlight of the Budget. “This new tax discount provides a break for an extra 1.5 million small business and the new tax rate for small business,” he said, “will be the lowest since 1967.” This in terms of what I said yesterday about the language of the Budget, I thought it was the best written Budget speech I had heard in a long time because it spoke in pub language. Well, this is Peter Strong, the CEO of Small Businesses Australia and he said, “one outstanding feature of the Budget is the way it has been communicated to the small business person. Normally, Budget Papers are dry tomes that are difficult to comprehend. This Budget has been communicated with an understanding that a small business is really a person or a couple, it has been written in our language.”
One of the authors of all that is on the line – the Prime Minister. Good morning. Prime Minister, good morning to you.
PRIME MINISTER:
Morning, Alan.
ALAN JONES:
Well, last night you were trumped because the Opposition Leader said it is not enough and you need a 5 per cent cut to small – are you laughing? – a five per cent cut to small business. Your comment?
PRIME MINISTER:
Well, it is interesting that he should demand that last night because you might remember back in 2010 Labor released the mining tax and one of the things Labor committed to when it brought down the mining tax was a 25 per cent company tax rate. So, it has actually been the Labor Party’s policy for five years to have a five per cent cut to the company tax rate but they had three years of that time in Government and they never delivered. So, this is a Labor Party and an Opposition Leader that just can’t be taken seriously because they throw around these commitments but never actually deliver on them.
ALAN JONES:
Isn’t it worse than that? I mean Kevin Rudd said in 2010, and I am quoting exactly, “the company tax rate at present exists in the upper third of the OECD.” In other words it is too high. “Our challenge is to bring it down at least to the middle and to optimally take it lower. The Government's target,” that is the Rudd Government, “is to bring it to 25,” and then this, he says, “but you know something, money doesn't grow on trees, you've actually got to fund the company tax cut from somewhere.” That’s the guts of it, isn’t it?
PRIME MINISTER:
Exactly right. So, what we had was a commitment to do it by Kevin Rudd but a recognition that it had to be funded and last night we had Bill Shorten saying we are going to do it but there wasn’t the slightest suggestion of where the money was coming from. That is why, like so much about the Opposition Leader, it just doesn’t add up.
ALAN JONES:
Were you surprised that there was no recognition whatever that if the Government, that is the Labor Government, had continued on that by the end of ten years the debt would have reached $667 billion. There was no recognition of debt or deficit or anything of that kind.
PRIME MINISTER:
Well, what we saw last night, Alan, was an Opposition Leader who was demanding, he was demanding more spending, he was demanding less tax, except on superannuation, he was demanding a smaller deficit and again it just doesn’t add up. It is magic pudding economics of the very worst sort. It is peddling false hope to people and the difference between the Budget and the alternative Budget last night: the Budget was a real plan, a real plan that we can and will deliver – unless the Senate, led by the Labor Party, tries to get in our way. Last night it wasn’t a plan – it was just a wish list.
ALAN JONES:
Why do you, I will just play this bit, and we hear this over and over again and of course it reaches the point whereby this stuff, if you say it often enough, the public perception is that it is truth. There was a cheer squad in the gallery which I have to say to my listeners was just extraordinary. Bronwyn Bishop had trouble, apparently these were people rallied by the Labor Party to be there. The galleries were full. Just have a listen to this extract:
BILL SHORTEN:
And I can promise you this Christopher Pyne; Labor will vote against $100,000 degrees every time you bring them to this Parliament.
SPEAKER:
There will be order thank you.
ALAN JONES:
Prime Minister, why does your Government allow that statement to prosper? There is not a university administrative figure anywhere in the country who has made any statement to the effect that any degree under deregulation would be anywhere near $100,000. Why does your Government allow that to be continually presented to the public?
PRIME MINISTER:
We can’t, as it were, gag the Leader of the Opposition, but people do need to understand that that is a complete fabrication, it’s a complete invention, it’s utter fiction. It’s utter fiction…
ALAN JONES:
Are they the same words as ‘lie’?
PRIME MINISTER:
Well, yes, it’s the big lie technique, I guess. You assert something often enough and you hope that people might actually get it into their heads. Even if they don’t quite believe you, they might get it into their heads. But one of the other extraordinary things he said last night was that there’d be no HECS for the 100,000 students doing education, science, mathematics etc. Well, if you looked at all those categories, there are 180,000-odd students in those categories and it’s yet another example of Bill Shorten not doing his homework because he just doesn’t think it through. It’s a series of thought bubbles which can’t be paid for which are completely unsustainable and that’s why as I said, Alan, he’s peddling false hope.
We brought down a Budget which was a serious attempt to grapple with our problems while at the same time making a serious attempt to kick-start small business, particularly the tradies of our country who deserve a fair go. The best thing about the Budget – and thanks for noticing this, Alan – Joe Hockey, remarkably for a Treasurer delivering a Budget speech, he spoke from the heart. There was passion and soul in Joe’s speech and it was based on his real experience, on the real experience of his family, on the real experience of millions of Australians. We want to encourage everyone to have a go. There are creative, dynamic people out there in our country and our economy. They’re clustered in small business and this is a Budget that wants to give them heart, to give them hope, to give them practical encouragement.
ALAN JONES:
But just on the other thing, because it disturbs me that the worst thing we can do in this climate now is to frighten people. Now, constantly the Opposition will tell you, and I must say even Gladys Berejiklian bought into this, that you have ripped $80 billion from the states in health and education spending and they mentioned the Gonski school funding. Is it correct that Labor did not put in the funding mechanism for those promises, there was never any money?
PRIME MINISTER:
Exactly right. Exactly right. They promised back in 2013 to spend money beyond the forward estimates but no money was ever allocated. It was always unsustainable, it was always pie in the sky. In Opposition, going into the election, we said that we would honour Labor’s commitments for the period of the forward estimates, but beyond the forward estimates that funding would go back to CPI adjusted for population and that’s what we’ve done. We haven’t ripped any money out because there was never any money there.
ALAN JONES:
Never any money in. Well just on the forward estimates, now I note on Tuesday the National Disability Insurance Scheme, we all agree with these things, in an ideal world they’re fantastic, but according to the Budget that will cost in four years’ time $53 billion. I mean, this is a mammoth amount of money.
PRIME MINISTER:
It is an astronomical amount of money and this is why the scheme has to be very, very well managed by absolutely top-rate people and why the whole of the Budget has got to be brought absolutely under control and that’s why you need people running the Budget, running the country who respect the taxpayers, who understand that every dollar government has we have it on trust from the taxpayers and we’ve got to be careful and prudent and frugal with it and we can only spend it in areas which are going to give a good return.
The interesting difference between Labor in government and the Coalition in government is under Labor spending grew by 3.6 per cent real a year. Under us it’s been growing by 1.5 per cent a year because we are careful with public money and because we’re careful, Alan, we are able to bring the Budget steadily back to surplus at the rate of about a half a percentage point of GDP every year.
ALAN JONES:
Now what’s all this business about paid parental leave? One ought to be simple to explain, namely that some employers have a paid parental leave scheme and if they don’t, well someone else will be able to get a paid parental leave scheme worth about $11,000, 18 weeks at minimum wage, $622, and then if your employer is already paying you, you surely don’t climb into the other. But you’ve got two people on your frontbench – Josh Frydenberg and Mathias Cormann – have had their noses in both schemes for goodness’ sake.
PRIME MINISTER:
Well, Alan, what we’re saying is that people are entitled to claim what’s available now, but going forward from the middle of next year, we think that there should be a safety net. If you don’t get any paid parental leave, the Government will give you paid parental leave, as you say, 18 weeks at the minimum wage. If your employer gives you less than that, we’ll top it up to that level. If your employer gives you more than that, well then you don’t need the government safety net.
ALAN JONES:
You don’t need it, it’s unbelievable, unbelievable.
PRIME MINISTER:
And we think that’s reasonable…
ALAN JONES:
Absolutely.
PRIME MINISTER:
… under the circumstances.
ALAN JONES:
Absolutely.
PRIME MINISTER:
And what we’re saying in particular is that we don’t believe that Commonwealth and state public servants should be getting two lots of paid parental leave funded by the taxpayer. That’s what we’re saying.
ALAN JONES:
Right. Australians own the iron ore that’s in the ground and the companies which mine it have signed contracts with the state of Western Australia in particular to maximise the price when they sell it. We’ve now got two big giants, Rio Tinto and BHP Billiton. The CEO of BHP Billiton said in October last year demand side in this business still remains good, but what we’re doing is we’re oversupplying at the moment and we will continue to oversupply. The Rio Tinto CEO, Walsh, said in June last year, “A lot of my friendly competitors are going to disappear.” In April this year, Walsh said Rio Tinto remains unapologetic about continued iron ore expansion that is forcing down prices. Now, as prices are forced down, the cost to the economy – all of us, the people listening to you now – are mammoth. In the month of March, the price fell 17 per cent, $8 billion ripped out of the economy. Isn’t there a point at which government has to intervene here and say to these people it’s not your iron ore, you were given a licence to sell this at the maximum price? I know there is an inquiry from Senator Xenophon. What’s your view about all of this?
PRIME MINISTER:
Well I think we do need an inquiry, Alan. I’m not in the business of demonising any company because I’m very conscious of the fact that Rio and BHP are Australia’s biggest corporate taxpayers and I want them to continue paying a lot of tax here in Australia and I want them to continue making a lot of profits here in Australia, but certainly, I think we do need to know the facts of what’s going on here, because I am conscious of the claims that are being made by Andrew Forrest and others.
ALAN JONES:
But of the cost to the economy? That’s to the people you’re talking to.
PRIME MINISTER:
And that’s why it’s important to know the facts and what we don’t want to see is predator behaviour by any companies. We don’t want to see irrational behaviour by any businesses, particularly when predator behaviour, when irrational behaviour may well have a dramatic impact on the economy.
ALAN JONES:
Well if it has a dramatic impact on the economy then surely there has to be some kind of sanction. Why wouldn’t government say, ‘Well listen, if you don’t play by the right rules then your licence to operate in Australia will have to be reviewed’?
PRIME MINISTER:
Alan, this is exactly why we’ve got the ACCC – the Australian Consumer and Competition Commission – we’ve got various corporate watchdogs out there to ensure that people are playing by the rules and it is against the rules in Australia for businesses to engage in predator conduct as some people allege is happening here…
ALAN JONES:
I know.
PRIME MINISTER:
… and we’ll make sure that the rules are enforced.
ALAN JONES:
Good on you. Good to talk to you as always and I thank you for your time.
PRIME MINISTER:
Thanks so much, Alan.
[ends]