SABRA LANE: Good morning, Prime Minister, and welcome to the program.
PRIME MINISTER: Well thank you, Sabra. It's great to be with you.
SABRA LANE: Let's start with the Fair Work Commission ruling on penalty rates. Do you support the ruling or not?
PRIME MINISTER: We support the independent umpire. We support the Fair Work Commission, the expert body, making the decision on this. As indeed Bill Shorten did, as you know, again and again –
SABRA LANE: Just hang on for a tick. I'm going to stop you right there because I stopped Bill Shorten from banging on about the other side when he was here last. I'd like you to talk about the ruling per se, not the Commission itself. Do you support it or not?
PRIME MINISTER: If you're asking me do I think that the penalty rate for a public holiday should be reduced in one award from 250 to 225 per cent, that is a matter that the Government has not decided. That is a matter for the Fair Work Commission. This is very important. A few days ago, you were asking Scott Morrison where is the evidence. The evidence is in the report which I have in front of me here, well over 500 pages. They’re the expert body. They've heard all the submissions and they've heard all the evidence. So they've made a number of adjustments and that is their judgement. It's their decision.
SABRA LANE: Cool, but it is a ruling. Do you support it? It's is a simple question? Yes or no?
PRIME MINISTER: We support the independent umpire and therefore, their decisions should be respected and accepted. That is exactly what Bill Shorten had always said. I know you don't like me saying that, but the fact is he's a back-flipper and he's a hypocrite on this. Now, we've been-
SABRA LANE: You say that I won't like hearing that. There will be a lot of people who say you are the leader of this nation, you should have an opinion. They would say that language that you're speaking to them at the moment is very lawyer-like.
PRIME MINISTER: Well, it's not. Why don't we stop trading debating points. Let's talk about low-paid workers.
SABRA LANE: It's not debating points. I'm challenging you to have a conversation and tell the people what you think.
PRIME MINISTER: What I'm saying to you is this. You have an independent umpire in the industrial relations area, the Fair Work Commission. They've heard over the years of an inquiry - that was started by Bill Shorten, the results of which he said he'd accept - they've come down with a ruling to reduce penalty rates in retail and hospitality, some of those awards, not all of them, on Sundays and public holidays. They've reduced, you know, typically from 250 per cent to 225 per cent or 175 to 150 per cent, those sorts of changes.
Now, an element in a part of every modern award says that it is the intention that any changes to awards will not reduce the take-home pay of employees. That is the take-home pay clause in every modern award. The Commission is now seeking submissions as to how to manage the transitional arrangements. There are a number that they have said that they do not support; what's called red-circling, which is where you would say that employee A's penalty rate remains the same but new employees, B, C, D, would be under the new arrangements.
SABRA LANE: So no grandfathering?
PRIME MINISTER: Well it depends what you mean by grandfathering. They've said they're not in favour of that. That’s what they’ve indicated, provisionally. They have asked for submissions on how the take-home pay orders could be conducted. But what they have said - and this is consistent with the practice in the past - is that the changes to penalty rates should be phased in over a period of years. Of course, what that means is that as the base pay goes up every year with the minimum wage, so you know, 2.4 per cent or whatever it is - that's what it was last year - every year. The employee's overall pay packet increases and offsets the phased-in reduction in penalty rates. Now we are very supportive of the Commission.
This is a complex area, I might say -
SABRA LANE: It is very complex -
PRIME MINISTER: But we're very supportive of the Commission managing this transition in a way that ensures that take-home pay is, as far as possible, maintained. Which is the object of the modern awards and -
SABRA LANE: No worker is worse off, is that what you are saying?
PRIME MINISTER: I think the difficulty with that Sabra is, let's take an example of a worker who only works on public holidays, right? Even if you phased it in over ten years, or five years, they would still have a reduction. Although, of course, and again this is why it's complex, the base rate is going to be increasing.
So I think the Fair Work Commission is very conscious of the need to protect low-paid workers. So are we. We respect them in the way they're doing that. We encourage them to do that job. They've asked for some submissions on some technical issues. We'll provide them with those. But the important thing is they have both the intent and the tools to ensure that the changes are phased in so that workers are not - as far as possible, not worse off in terms of this transition.
SABRA LANE: Still but you can't say yes or no, whether you actually support the ruling?
PRIME MINISTER: I support the Commission. If you're asking me to say do I agree that the rate for a particular award on a particular public holiday should be 275 per cent or 250 per cent, that is not a judgement that we have taken and neither have you. Because I haven't been through all the evidence, the Government hasn't been through all the evidence, in the way the Fair Work Commission has. That's their job. You see this is the point. This is an expert -
SABRA LANE: People from your own side say the Government is bleeding on this. People don't think: ‘Gee, the Fair Work Commission has made this ruling’. They associate the decision with you?
PRIME MINISTER: No, I believe Australians understand this is a decision of the Fair Work Commission. It's very important -
SABRA LANE: Your people are telling me they're bleeding on this, because people are blaming the Government. We sent Julia Holman out to a shopping centre on Monday and they certainly associate this with a decision of Government and not the Fair Work Commission.
PRIME MINISTER: Well it is a decision of the Fair Work Commission. It is decision of the independent umpire and that's the fact. Here we are on the national broadcaster with millions of listeners who will be pleased to know that the facts are it was a decision of the Fair Work Commission, not a decision of the Government, and that was quite appropriate.
You know, we've got to recognise that it has been an absolutely fundamental element of the Australian industrial relations system that penalty rates in awards, minimum wages, are set by the independent umpire, the Fair Work Commission, and its predecessors, rather than by Government.
I mean Bill Shorten warned against the terrible idea that Parliament would be setting penalty rates, only last year. He chastised the Greens for suggesting such a reckless policy. Now that's his policy.
SABRA LANE: Economists have acknowledged the nation’s growth rate figures of the nation yesterday were very, very good. Consumer spending was up. It helped boost all of that. Are you aware that a good portion of the population, feel though they're not rolling in good times?
PRIME MINISTER: We certainly are. We certainly are concerned to ensure that the benefits of economic growth are felt by, are enjoyed by, all Australians. Right across Australia and all parts of Australia. There's no doubt that parts of regional Australia - not all, but parts - of regional Australia have done it tough, largely because of the downturn in the mining and construction boom.
You know, we have seen in this last quarter a pick-up in business investment which is a very good sign. But obviously, we had mining investment, investment in mining was up to 8 per cent of GDP. It couldn't stay there forever. It came off and that's hit some regional areas very hard.
Now, the good news is that because we are growing our exports, and you saw on the weekend I secured greater access for sugar and for beef into Indonesia, both. It’s a huge market. It will be the fourth biggest economy in the world in a few decades. I mean this is a very big market. So we're driving that market access. That benefits regional Australia. You're seeing that in the numbers in the national accounts. You see the growth -
SABRA LANE: I see you've got a list. You'd probably like to read out the lot?
PRIME MINISTER: No, I'm not going to read them all out but I’ll just tell you, you look at the significant growth over the year, over the quarter and over the year in agriculture, forestry and fishing. Now that is driven by, up 23.7 per cent through the year, that is driven by better prices and more volume. That is powered, supercharged, by the big export trade deals that the Coalition Government has secured.
SABRA LANE: Now, the Treasury Secretary, John Fraser, has given the Government a bit of a caution. He would like to see these proceeds banked to help budget repair. Will you do that?
PRIME MINISTER: Well, we're certainly focused on bringing the budget back into balance, as you know, by 2020-2021. That is our goal and we need to do that. We cannot keep on living beyond our means and passing a larger and larger mountain of debt on to the shoulders of our children and grandchildren.
SABRA LANE: The first budget of an electoral cycle is usually one that gives governments the opportunity to make unpalatable choices. The Government is in a position where is doesn't have any political capital to expend on unpopular choices.
PRIME MINISTER: Well, this is your comment?
SABRA LANE: Yeah, well it is my comment. How do you respond?
PRIME MINISTER: The Government is charged with leading Australia, with managing the economy, with restoring the budget to balance. All of the political commentary in the world, Sabra, doesn't get away from the fact that I have a responsibility as Prime Minister to ensure that we deliver the economic growth, the responsible and prudent management that will ensure our children and grandchildren have great jobs and that we're not burdening those very same children and grandchildren with a mountain of debt that will mean, inevitably, they will either have reduced government services, or higher taxes or probably both.
SABRA LANE: Do you think Tony Abbott is intent on blowing up this government?
PRIME MINISTER:Look, I'll decline the opportunity to comment on personalities.
SABRA LANE: Without naming him, you blamed Mr Abbott's intervention last week for the bad polling results that the Government received in Newspoll on Monday. He might do that for 30 successive Newspolls.
PRIME MINISTER: I'm more interested in the very good results in the national accounts. I'm more interested in the jobs that are being created in regional Australia because of those big export opportunities.
SABRA LANE: Sure.
PRIME MINISTER: Because of our investment in the regions too, in infrastructure.
SABRA LANE: Nice deflection. There will are many people though who think; is Mr Abbott's contribution now a worthwhile one? Is it worthwhile him continuing to sit in the Parliament?
PRIME MINISTER: Sabra, my focus is on delivering strong economic growth, great opportunities for Australians. What is our mission? Opportunity, supported by security –
SABRA LANE: There’s your mission but he keeps sucking out the oxygen of what you do, Prime Minister.
PRIME MINISTER: Well, this is, you may be interested in personalities or a couple of personalities. I'm interested in the prospects of 24 million Australians. That requires continued, strong economic growth.
You've got to have businesses that are growing, businesses that are opening, businesses that are starting and expanding and around Australia you're seeing strong economic growth.
We'd like it to be stronger, that's for sure, and we're doing everything we can to drive it.
That's the big difference between my Government and the Labor Opposition. Every single one of our policies is designed and calculated to deliver more investment, more employment, more growth.
Labor is on an anti-business campaign, as you know. They're playing the politics of envy. There is nothing in their platform that would encourage one business to invest one dollar or hire one new employee.
SABRA LANE: Just on that point of not one dollar and one piece of investment there. That was the argument that the Treasurer used yesterday for not wanting to buy into the argument about changing 18C of the Racial Discrimination Act. Do you agree with his sentiments there?
PRIME MINISTER: With what he said yesterday to you?
SABRA LANE: Yeah.
PRIME MINISTER: Yes, I think the point that he made - that it’s obviously not an economic issue - that's true, that's for sure.
SABRA LANE: It's going to be up to you now though to make decisions on whether 18C will be altered. What are you going to do?
PRIME MINISTER: Well, it with will be up to the Cabinet and ultimately the Party Room to consider the report of the committee.
We are the most successful multicultural society in the world. It is founded, it's built on a foundation of mutual respect. Nobody talks about the importance of mutual respect, the importance of multiculturalism, our extraordinary success, more than I do. I spoke about it at the United Nations last year and described how we have done something truly remarkable in Australia.
Equally, we are a free society and freedom of speech is critically important. So it's perfectly legitimate for there to be a debate about how do you balance the universal condemnation of speech that incites racial hatred, or vilifies people on the basis of their race. Nobody supports that.
On the other hand, you've got to support free speech, so getting the balance right is the issue and the committee's done a very good examination of it.
I have always been a passionate defender of free speech from the days when, as a mere boy, it seems so long ago, I defended the right of the old spy Peter Wright to publish the Spycatcher memoirs.
SABRA LANE: Is it an ideological frolic? One of your colleagues, Craig Laundy, says that this is a frolic and it shouldn't be tinkered with. It's being pushed by MPs who sit in safe seats and don't have to worry about a backlash.
PRIME MINISTER: Well, Sabra, there is a wide range of views about it but getting the balance right on free speech is important. Can I tell you - free speech is not something we should take for granted. If you lose it, you'll know that it's gone.
We are very lucky to live in a successful, multicultural society, a democracy, rule of law, freedom - freedom is the most important element. Freedom, democracy and the rule of law. We've got that here in Australia and we should cherish it. And we should never, ever be ashamed or afraid of looking at the balance between protecting people from race hate speech and freedom of speech. This is a very legitimate area to discuss, to debate.
Scott's right, it's not going to result in people making another investment and taking on more employees. But nonetheless, we are here in a house of freedom, in Parliament House, a house of democracy, and these issues are important.
SABRA LANE: Prime Minister, thank you very much for joining AM this morning.
PRIME MINISTER: Thanks so much, Sabra.