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Transcript 40343

Interview with Jon Faine, ABC 774 Melbourne

Photo of Turnbull, Malcolm

Turnbull, Malcolm

Period of Service: 15/09/2015 to 24/08/2018

More information about Turnbull, Malcolm on The National Archive website.

Release Date: 04/05/2016

Release Type: Transcript

Transcript ID: 40343

JON FAINE:

The Prime Minister joins me from the national capital, Mr Turnbull good morning to you.

PRIME MINISTER:

Great to be with you Jon.

JON FAINE:

Congratulations, what happened to the industrial relations emergency that was going to trigger the double dissolution, not a mention of it in the Budget last night? No measures to deal with it, nothing.

PRIME MINISTER:

Well Jon as you know, restoring the rule of law to the construction sector is a very important economic reform and –

JON FAINE:

It didn’t get a mention in the Budget.

PRIME MINISTER:

Well because it doesn’t require the expenditure of money Jon, its -

JON FAINE:

The Budget is a political speech not just an economic one.

PRIME MINISTER:

Well –

JON FAINE:

So on the one hand can you get your narrative straight, one week you’re saying there is an industrial relations emergency and the next time you get a big chance to steal the national stage it doesn’t get a mention.

PRIME MINISTER:

Jon let me just say this to you – the budget is a plan for economic growth. It’s a national economic plan to ensure we have strong job growth and strong economic growth in the future. It ties in with all of our measures, including our efforts to restore the rule of law to the construction sector. That is a very important part of our economic plan. Our economic plan includes all of the measures in the budget and others that we have laid out beforehand in the lead up to it. The National Innovation Agenda, ensuring that we get the right support for start-up businesses and we get more collaboration between our top researchers and businesses and industry. Of course it includes our Defence Industry Plan, where we will see our expenditure on defence getting the capabilities our Australian Defence Forces need, being provided by Australian industry - and above all with that the cutting edge of technology driving strong job growth and the type of innovation and high quality jobs that we want in the 21st century.

JON FAINE:

Where’s the job growth come from, what’s the evidence that a tiny cut to income, to company tax, a tiny cut, that generates for most businesses almost negligible improvement in their bottom line, that that will create jobs?

PRIME MINISTER:

Well let me say to you Jon, you’ll find that the Treasury and I think every economist will disagree with you there. If you reduce the tax on businesses, on companies, and remember most of the companies we’re talking about that are getting the benefit of these cuts at the outset, are family businesses. We’re talking about small and medium businesses. This next year businesses with a turnover of $10 million or less, these are not giant multinational corporations. These are family businesses for the most part, family owned, very often family run.

JON FAINE:

One percent change in company tax equals job growth? Where is the evidence of that?

PRIME MINISTER:

Well it’s not a one percent change Jon. Its two and a half percent out of thirty percent its quite a significant  -

JON FAINE:

For some of them but not for others.

PRIME MINISTER:

…it’s a significant reduction in company tax and what that does is it provides greater incentives for owners of businesses, investors in businesses, to invest. That’s why the Australian Treasury, not me, not Scott Morrison, the Australian Treasury forecasts this will add over time, as a result of these changes to enterprise, one percent to GDP.

JON FAINE:

Over decades. Don’t mislead us that’s over decades, not in the short term. Not in the next few years, that’s over decades. One percent over decades doesn’t equal jobs growth.

PRIME MINISTER:

Well Jon that’s your contention. Buts it’s not based on any evidence.

JON FAINE:

Well that’s the budget papers with respect Prime Minister.

PRIME MINISTER:

Jon let me just make this very clear. We have a plan for jobs and growth. Everything –

JON FAINE:

Well what is it? Because it wasn’t on evidence last night.

PRIME MINISTER:

Well Jon the evidence is there, we had 26,000 jobs created in March, we’ve seen strong -

JON FAINE:

Part time.

PRIME MINISTER:

…we have seen strong jobs growth across Australia notwithstanding the decline in the mining construction boom. What we are doing is ensuring through a whole range of measures including, I’ve mentioned a number; innovation; investment in defence industries; opening up big markets in Asia, the Free Trade Agreements in Asia; ensuring that out tax system is sustainable; ensuring that multinationals pay the tax that they should and that we crack down on avoidance; and then giving relief to Australian businesses that are paying their tax, giving relief to them so that they will get a better return on their investment.  As a result, if you provide that incentive, they will invest more and when they invest more there will be more jobs.

JON FAINE:

Joe Hockey promised that he’d crack down on multinational tax avoidance and offshoring of profits and that didn’t happen. Why should we trust that Scott Morrison and your plan is any better than his was?

PRIME MINISTER:

Well Jon if you follow this matter you’ll have noticed that Google is already making changes to its corporate structures so that it will pay more tax in Australia. It’s responding to the multinational tax avoidance measures that Scott Morrison introduced at the end of last year… Now what is set out in this budget is the toughest tax, multinational tax avoidance measures of any comparable country. So this is what we believe – we believe business taxes, should be, where it’s affordable, and we can afford it, lower. Because that provides incentives for investment and that will drive jobs and growth. We also believe –

JON FAINE:

The Panama Papers show us do they not –

PRIME MINISTER:

We also believe that everybody must pay their tax.

JON FAINE:

Prime Minister the Panama Papers show us that rich people will always find that’s its worth their while to spend their money on tax planning and tax evasion and avoidance, both of them, rather than compliance. It’s just it makes good business sense as you personally have discovered in the past. It makes good business sense to arrange your affairs to reduce your contribution to the tax and Treasury in Australia.

PRIME MINISTER:

Well Jon I have always paid tax in Australia. I pay tax on all of my investment income I always have done. I’ve always paid a lot of tax. I don’t have a family trust for example. I’ve always been very conservative –

JON FAINE:

You and me together Prime Minister.

PRIME MINISTER:

I’m very conservative in the managing of my tax affairs I can assure you and the innuendo you made there was unworthy.

But let me just say this to you: Of course people will try to avoid paying tax and of course some people will cheat and break the law. But that’s why you need to give the taxation office the resources to enforce the law and you need to make sure - 

JON FAINE:

And do you concede it was a mistake to de-skill and de-staff the ATO, ASIC and ACC organisations a few years ago when your colleagues Tony Abbott and Joe Hockey were in charge and ripped the guts out of those three regulators.

PRIME MINISTER:

Jon the issue is what we are doing now. The issue is what we are doing right now. What we are doing now is laying out a national economic plan for jobs and growth to ensure that we successfully transition from the economy pumped up by a mining construction boom to one that is more diverse. As part of that we are ensuring, with the toughest laws in any comparable country, that multinationals pay their tax. That everyone pays their tax. But obviously the issue of multinationals in a digital global economy that has produced challenges. It’s been recognised by the OECD and we played a leading role in tackling that as one of the OECD members. But this legislation that has already been introduced and passed last year, and the new measures proposed in the budget take the toughest laws in any comparable country. We take the view that paying tax is not optional. That you have to comply with the law.

JON FAINE:

OK the youth jobs plan, $4 an hour for interns already described by some of your critics as the new slave trade Prime Minister.

PRIME MINISTER:

Jon this is about ensuring that young people who are unemployed get a start. It ensures that they get the training they need to be job ready. Then they get the opportunity to be an intern and get the experience of working in a work place. You see Jon what we want is results. Scott Morrison honestly, frankly, acknowledged that the measures we have had to deal with this very difficult problem have not been successful enough and that we need to do something new. And that is what we are doing. The best way to make someone who is unemployed employable is to give them the experience of employment. That’s what this does.

JON FAINE:

Or does it just displace people who otherwise would get a real job and instead give the revolving door, the rotating internship priority over people who would otherwise get a proper job? 

PRIME MINISTER:

No Jon this is going to be transformational we are very confident -

JON FAINE:

I run a supermarket. I have a choice. I can either employ someone to stack shelves or just take a whole lot of interns and the Government will pay for them and I get $1000 every time I sign one up.

PRIME MINISTER:

Well Jon, this will ensure that those young people get an experience of being employed. And we have no doubt that many, if not most of them, we will see, time will tell, this is a very difficult area it is easy to be a critic. It is easy to be very cynical, as frankly as you are being. But we are in Government –

JON FAINE:

I’m being sceptical then I am doing my job which you would expect me to do Mr Turnbull of putting anyone in power to account. That is what we are here for.

PRIME MINISTER:

No Jon you don’t have to be so defensive. I am just making the point that it is easy to criticize. What we are seeking to do is make a difference to young people’s lives. What we are seeking to do is tackle this challenge of youth unemployment and give these young people a chance to work, to get the experience of a workplace, to get the experience of getting up, getting up in the morning, being at work punctually, engaging with other people in the workplace, getting that socialisation that comes from working with others. All of that will equip them better to get on the road to a lifetime of employability and that will mean obviously their lives will be changed. Theirs and their families for the better. That’s our commitment. Our commitment is right across the board, to a national economic plan which we have now laid out which will deliver stronger growth and more jobs.

JON FAINE:

Ok to the opposite end of the demographic spectrum from the young unemployed to the self-funded retiree…self-funded retirees ironically will be better off under the Labor Party’s plan than the Liberal Party’s plan. How can that be keeping your Liberal Party faithful happy?

PRIME MINISTER:

What we are doing with the changes to superannuation which is as you know reduce the very generous tax concessions to a very small percentage, a few per cent of superannuants, of people who are contributing to super, it is what we are doing is scaling back some of those very generous concessions and what that enables us to do is to ensure that the superannuation scheme works better for people on lower incomes and in particular for women. As you know providing more flexibility in the super system so that people whose employment, periods of employment have been interrupted, very often women who have taken time out with their family, are to be able to catch up with their concessional contributions, we also -

JON FAINE:

But Prime Minister the flaw in that thinking is that people on 60, 70, 80 thousand dollars a year, they don’t have spare money to put in to super they are struggling just to get by.

PRIME MINISTER:

Well John again, look all I can say to you is that our focus is on ensuring that people have opportunities, they have flexibility, that the super system works to achieve its purpose which is to give middle Australia the opportunity to make the savings that will enable them to be comfortable in retirement and not have to rely on the age pension. It is not designed to be a wealth creation exercise for the very rich.

JON FAINE:

No, no I totally agree. The point I am trying to address is one that is precisely the opposite. To try to offer incentives that you say are targeting people on 60, 70, 80 thousand dollars to maximise super, misses the point that those people don’t have any spare money to put into super. Their entire income is used just to stay, to clothe themselves and their kids and get them through school and keep the car running. They don’t have spare cash.

PRIME MINISTER:

Well Jon, I’m sure that as a person who is very well paid, and who understand the importance of the super system operates for the benefit of middle Australia and for all Australians - and for the objectives I described - you’ll understand that the people often, the earnings they have through their life, vary. People sometimes go through periods of low income, higher income, no income for a whole range reasons. The issue with women and the fact that they have accumulated materially lower super balances throughout their working life, that’s a big one. One way of addressing that is to provide disability to catch up after a period out of the workforce. It is a flexibility that we believe many women will take advantage of. You’re making the case that many won’t. Well at least we are providing the option to do so. We are giving people the freedom to - if their circumstances change then there is no barrier to them catching up for those years when they were not able to contribute to super because they were not employed.

JON FAINE:

A couple of other things please and I know my time is tight but if I may please contrast the Victorian Labor State budget with Scott Morrison’s Federal Liberal budget as we now have the two firmly in. From a Victorian perspective Prime Minister on display. The State Government here decided they would go on what I have called an infrastructure binge and the Victorian economy as you know is going gang-busters. You’ve gone in the exact opposite direction. Why not stimulate the national economy?

PRIME MINISTER:

Well we are spending a record amount on infrastructure and in fact you have mentioned Victoria - as you know and we talked about it when I was in Melbourne, I talked about it in Melbourne with the media in Melbourne - we are providing $1.5 billion as you know towards a series of important infrastructure projects in Melbourne. Towards upgrading the Monash Freeway which is as you know very congested, upgrading the Melbourne Ring Road, the M80 on the West of the city, that’s $350 million, $500 million for the Monash, $220 million to upgrade the freight rail lines in the Murray Basin. Of course through the Asset Recycling Initiative which was announced in the budget, we are providing an additional $877 million to Victoria, most of which is going to the Melbourne Metro. That is $857 to Melbourne Metro, and $20 million additional to the Murray Basin rail exercise. So what we are seeing is very substantial commitment of funds to infrastructure and of course collectively it’s a $50 billion program right across Australia.

JON FAINE:

One last issue though, do you too blame human rights activists and the lawyers for the self-immolations amongst asylum seekers on Nauru.

PRIME MINISTER:

Jon let me say this, these poor souls that have set out to harm themselves, one of whom of course has died. This is, these are tragedies and these people are going through, clearly, through very great mental anguish and.

JON FAINE:

You’re in a position to do something about it but you say you can’t.

PRIME MINISTER:

Well Jon, this is the issue. They are provided with medical support, they are provided with mental health services, but here’s the thing. If we were, as some people advocate, if we were to bring the people of Nauru and Manus to Australia, that would send a signal as you know it would to the people smugglers to start up again…

JON FAINE:

So do you blame the lawyers and the human rights activists too as did the Immigration Minister and the Nauruan government.

PRIME MINISTER:

Well let me just say this to you Jon, I would encourage everybody who participates in this debate to be very careful that they do not create the impression or offer false hope to people on Nauru and Manus that they may be able to come to Australia. Let me be very, very clear, we know this is a tough policy, but the alternative is thousands drowning at sea, thousands of unauthorised arrivals, the whole tragic people smuggling exercise underway again.

JON FAINE:

It doesn’t have to be the only alternative, it’s not as binary as that Prime Minister, we could arrange a more orderly way of dealing with the pressures as countries in Europe are trying to do but we choose not to.

PRIME MINISTER:

Jon we are seeking, we encourage the people on Nauru and Manus, those in particular whose applications for asylum have been rejected, we encourage them to return to their country of origin but they very often choose not to do so because they believe that the Australian government will relent and that they will be able to come to Australia or, as the people smugglers are now arguing now, and we know this, this is hardly secret, we know that the argument is being put to people that there’s an election coming and if the Labor party win the election then the doors will be open once again.

JON FAINE:

A double dissolution election, you have to negotiate with a hung parliament and a hung senate for support from the greens and crossbenchers and one of the conditions they demand for you to continue as Prime Minister is that you end offshore detention, would you agree to it or not?

PRIME MINISTER:

Now you can hypothesise about all sorts of scenarios.

JON FAINE:

Would you compromise on it to stay on in office?

PRIME MINISTER:

Jon we are focused on ensuring that we form a government after the election and that we deliver our national economic plan for jobs and growth. That’s our focus.

JON FAINE:

I look forward to seeing you at some stage during the two month long election campaign that will exhaust everyone but I hope not you. Thank you for your time this morning.

PRIME MINISTER:

Thank you

Transcript 40343