Labor’s taxes; Population; Global Compact for Migration; Paris Agreement;
Prime Minister
ALAN JONES: Change negative gearing, that means your rent will go up because fewer people will be investing in property to take advantage of negative gearing. And if you own a property, well there will be fewer bidders for your property when you want to sell it, so your price goes down. Then, a 50 per cent increase in capital gains tax – my view, and I’ve told you this many times - is if the Coalition sticks to those arguments and doesn’t get side-tracked, there’s no way in the world Labor can win an election, but he’s got a fight on his hands, the Prime Minister. He’s on the line, Prime Minister good morning.
PRIME MINISTER: Good morning Alan.
JONES: How hard is it to prosecute that case?
PRIME MINISTER: Well I think it’s changing because of what we’ve seen in the housing market most recently, which has been a real softening, which I know is of real concern to many Australians. The value of the most important asset that you have, what Labor is proposing is to smash the value of your house. It’s that simple. I mean when Paul Keating went and changed negative gearing back in the 80s he said: “Oh, this will be good and it won’t affect anything.” And guess what happened? Rents in Parramatta went up 20 per cent, 20 per cent. They had to be shamed into changing it back and now we’ve got Chris Bowen trying to emulate Paul Keating on that same change, beating his chest and saying; “It won’t be a problem”. Yeah it will. Your rents will go up and it will crash the value of your home.
JONES: This is, I’ve got to say Prime Minister, this was not a free kick to the Prime Minister, I’m raising these issues because this affects every Australian. There has to be an awareness of what the risk is, what risk is involved when you walk into that ballot box. Now, just on capital gains tax this doesn’t only apply to negative geared housing sales. I mean as I understand it – this point hasn’t been hammered – but all capital gains. This is if you’ve got shares, or a small business, or whatever, isn’t it?
PRIME MINISTER: It’s on everything.
JONES: That’s it.
PRIME MINISTER: It’s on everything, that goes up by 50 per cent. It’s an increased tax, as you say, of 50 percent on investment in everything. I mean how you think you can grow an economy – and there are lots of issues out there -
JONES: Everyone loves a bit of capital gain.
PRIME MINISTER: Well that’s the point, that’s why you invest, that your asset will appreciate. That’s why you do it, that’s how people pay for their retirement.
JONES: So just to explain again to our listeners, 50 per cent as things stand. 50 percent of the capital gain is now assessable for income tax rates?
PRIME MINISTER: That’s right.
JONES: That will rise to 75 per cent of the capital gain will be taxed?
PRIME MINISTER: Correct.
JONES: That’s a tax increase of 50 per cent.
PRIME MINISTER: Yeah and that’s one of $200 billion of extra taxes which will be one big wet blanket on an economy that we’ve got back into shape, which is ensuring that over 100,000 young people got a job last year. That is the strongest youth jobs growth that this country has ever seen on economic record. So, growing jobs, getting unemployment down, getting the economy moving forward. And Bill Shorten thinks the best thing you can do for that in the future is throw a $200 billion wet blanket of tax over the top of it, by abolishing negative gearing as we know it, putting up capital gains tax, as you say taxing retirees. What I’ve said about that is, that’s a $5 billion slug every year by the way. What it is, is those retirees, those Australians -
JONES: Well let’s come to retirees, sorry I’ll just cut you off there. Let’s come to retirees. This specific issue now, retirees. Complicated language, “dividend imputation” – I hate it - “franking credits”, I hate that sort of stuff. This is to avoid double tax, because already, company tax has been paid. But the issue that has been scrapped by the Labor Party here, is the same issue that the shadow treasurer Simon Crean addressed in 1999 when he said: “We have no difficulty supporting the proposal because it’s our policy. It builds on the major reforms accomplished by Labor all those 15 years ago and improves the current taxation system faced by low income investors especially retired Australians.” Now the Labor Party is saying –
PRIME MINISTER: Yeah they’re abandoning that. Basically, retirees won’t get their tax refund.
JONES: That’s it.
PRIME MINISTER: I mean if I came up to anyone listening to this program who isn’t retired and I said: “Oh, that tax refund by the way, we’re going to take that back, you’re not going to get that.” Well, that is exactly what Bill Shorten and the Labor Party are saying to retirees, to small business owners all around the country. The reason they’re doing this Alan, is because they’re making big promises and –
JONES: They have to be paid for.
PRIME MINISTER: They have to be paid for and the way they’re going to do it – they say they’re going to do it – is by increasing taxes. But it’s a dumb game, because if you throw these taxes on the economy, you slow the economy down, which means you make less revenue because the economy isn’t performing as well. You get people going off paying taxes to going back onto receiving welfare – which is what happened under Labor last time. That is one of the key reasons we’ve been able to get our Budget going back into surplus next year.
JONES: Okay. Now, look you’re the leader here, are you confident though that every one of your people are singing off the same sheet of music? I mean those are the stories that win elections, is everyone singing that song?
PRIME MINISTER: Yeah they are Alan. I mean there will be people outside of the Parliament, there will be people that aren’t in the team that runs onto the field, they’ll have their views and that’s alright. But the people in the team, the people lining up at the election, the people going to the people of Australia at the next election, we’re committed to having a stronger economy. We’re committed to delivering that for Australians. And not just to put the trophy on the shelf which says “AAA-rated economy, growing at over 3 per cent, unemployment down to five percent” – which as you said is full employment according to economists. We’re doing it because that’s what pays for hospitals and schools and the pension and affordable medicines and Medicare. See if you’re committed to Medicare you’ve got to be committed to a strong economy, because that’s what pays for it. This is the bit Labor never understands. They think they can pay for Medicare by jacking your taxes up. You know, it doesn’t work that way.
JONES: Right.
PRIME MINISTER: Businesses doing well, the economy doing well, employing people, that’s what pays for Medicare.
JONES: Okay, the Bradfield Oration – well done. But one sentence stood out and we talked about this yesterday on air here. “Australians are saying enough, enough, enough. The roads are closed, the buses and trains are full and the schools are taking no more enrollments. I hear what you’re saying, I hear you loud and clear,” and you’re talking about population. Now that’s all rhetoric. When are you going to announce that we are going to cut the rate of growth of migration? When will you announce that?
PRIME MINISTER: Well, that will go in next year’s Budget, because -
JONES: They want this next week.
PRIME MINISTER: Yeah but Alan, what I announced the other night is a fair dinkum process to actually get the actual level right. I suggested the other night that we’re currently running about 30,000 below the cap -
JONES: But the cap’s too high.
PRIME MINISTER: That’s what I’m saying Alan.
JONES: Well, can’t you announce today?
PRIME MINISTER: No, because I do my homework before I make decisions. What I’m -
JONES: Well, the public are wanting a decision. It’s a big issue.
PRIME MINISTER: Well, I know and this year’s migration program is set -
JONES: So you spelt the issue out -
PRIME MINISTER: Sorry, I’ll just finish.
JONES: Sorry –
PRIME MINISTER: What I’m saying is the migration program is set a year in advance. This year’s program is already set. We’re going to have to make a decision in next year’s Budget for the program that follows that.
What I’m saying is I’m asking each of the states and territories to tell me how many people they believe they can have next year. It’s up to the states to actually tell me that, because they’re the ones who build the hospitals and run the schools and put the roads in. They need to tell me what their infrastructure can carry.
JONES: I know, but out there the voter is very impatient. See, you made the case the other day -
PRIME MINISTER: I think that was a pretty big hint Alan. And people will know that I’ll follow the process and come to the right answer. But I’m not going to pull a figure out of the air. That’s not how you run a country.
JONES: Well we don’t like these hints but you said, just to clarify for our listeners, 54 per cent of Australia’s population increase in the two decades to 2016 came from migration, 54 per cent. But 75 per cent of that went to Sydney, Melbourne and south east Queensland.
PRIME MINISTER: That’s right.
JONES: Now you said; “We hear you, we hear you, we hear you.” We can’t pump in a million people every three years.
PRIME MINISTER: Yeah but then there are - as we discussed last time Alan, that’s true, that’s what is happening in south eastern Australia - but you go to northern Australia, you go to Darwin as I was just last week, if you go to Western Australia, South Australia, Tasmania, they’re wanting more people.
JONES: Are you sure?
PRIME MINISTER: Yes I am Alan, absolutely. I’ve been in all of those places.
JONES: Because people from Rocky wrote to me and said; “Look, he’s going to build a Ring Road, we want jobs. Why is he talking about bringing people to Rocky? We want jobs, we haven’t got them.”
PRIME MINISTER: Well that’s why we’re building the Ring Road Alan. It’s a pretty big project.
JONES: They’re not the sort of jobs they’re talking about.
PRIME MINISTER: It’s the biggest project they’ve seen in Rocky for a very long time. What the advice I got from the officers up there - you know the people who run the show up there – is, their infrastructure can cope with more.
JONES: So you’re telling me that people are saying to you; “We want more people”?
PRIME MINISTER: You go to Adelaide, that’s what they’re telling you. Go to Tasmania, that’s what they’re telling you. Go to Western Australia -
JONES: Who is “they”, who’s telling you that?
PRIME MINISTER: People I walk into in the street Alan, and the Premiers of these states. I mean, not everywhere in Australia is Sydney or Melbourne. Every state, every place has a different experience.
JONES: Right just on that, okay. Last night, late last night, and you’re going to make an announcement today - very quick stuff this - you’re not going to sign up to the global compact on migration?
PRIME MINISTER: No, I’m not.
JONES: Okay, but are you going to sign up to the global compact on refugees?
PRIME MINISTER: Well it doesn’t work the same way. The global compact on migration would compromise Australia’s interest. Because, amongst many things, it doesn’t distinguish between those who legally enter Australia and those who come the right way.
JONES: No, but you’ve taken the debate a step further last night - and I agree with you, everyone agrees with what you said; “We don’t feel the need to join the internationalist clubs to work out how to get this done.” Now I’m just asking you; why do we need to join the internationalist club to work out how to deal with refugees? Why do we need to join the internationalist club to join to know what we’re going to do about climate change?
PRIME MINISTER: Well let me answer both of those questions. In terms of the one about refugees, it’s not a signed-up compact like this one on migration, it’s a completely different process. There’s no document you sign and when it went through the UN with a whole bunch of other issues which are completely inoffensive - and both Peter Dutton and Marise Payne when they advised me about this, made it really clear that that one wasn’t compromising.
JONES: Well, the Global Compact is about resettling more refugees. Is someone going to tell us how many refugees you can take?
PRIME MINISTER: No they’re not. That’s not what that does and we said very clearly -
JONES: Labor will sign up to all this stuff.
PRIME MINISTER: If I could just finish, what I’m saying is, on the other one, we put our clear reservations, we put those on the record. So it doesn’t bind us into anything and it doesn’t compromise what we do on our borders.
I would never allow something to compromise our borders, I worked too hard to ensure that we weren’t in that position. This Global Compact on Migration, it’s not a good deal. We’re not going to sign up to it because I believe it would compromise us. But I will consider each of these on their merits and I’ll do what I believe is right.
JONES: Well, I understand the Global Compact on Refugees is going to commit countries to resettling more refugees and that worries people.
PRIME MINISTER: Well we’re not going to do that.
JONES: Okay, well then don’t bloody sign the thing. Now look, next week it is, they’re off to Poland to ratify the Paris Agreement. Do we need to join the internationalist club to work out what we will be doing about energy and global warming and all that nonsense? Are you sending someone to Poland next week to ratify Paris?
PRIME MINISTER: Well it’s not high on my agenda, about who we’re sending, Alan. But I simply make this point, as I’ve made on your program now on numerous occasions. There is no loss to Australia, no loss to Australia by keeping to the commitment we sent early in our Government, which is the 26 per cent. It doesn’t change electricity prices.
JONES: Therefore, there is no need to go to Poland?
PRIME MINISTER: Let me tell you this though; I’ve just spent the last several weeks re-engaging, stepping up in the Southwest Pacific, which is an incredibly important issue for Australia’s security interests and Australia’s national interests. Now this is the number one issue amongst our Pacific Island partners.
JONES: Okay now we’ve been beaten by the bell. Therefore -
PRIME MINISTER: Just let me finish, this is very important. To not go ahead with where we are on this – I’m not putting any money into global climate funds, I’m not doing any of that rubbish – what I am doing though, is ensuring that we secure Australia’s national interest by working closely with our Pacific partners.
There is something to be lost if we were to walk away from the position we’re in and there’d be nothing to gain by walking away from the position we have. So I’ve made that call.
JONES: All right, we’ll resume the discussion next week. As the Prime Minister, you’ve also affected the programming here but don’t worry about that.
Thank you for your time, we’ll talk next week.
PRIME MINISTER: Thanks Alan.