The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
Picture of Peter Costello

Peter Costello

Treasurer

11 March 1996 - 3 December 2007

Transcript of 31/05/01

Transcript No. 2001/081

TRANSCRIPT
of
HON PETER COSTELLO MP
Treasurer

DOORSTOP
Ballarat
Thursday, 31 May 2001
2.45pm

 SUBJECTS: Russell Mark, Labor policy on petrol excise indexation, One.Tel employee entitlements, tax bracket creep

JOURNALIST:

Mr Costello, Mr Beazley was here in Ballarat yesterday (inaudible) win for the next election. How do you feel about that?

TREASURER:

Ballarat is going to be a hard seat for the Coalition to win. The Labor Party is treating it as if it is already their own. But one of the advantages that we have got here in Ballarat, is, we have got a terrific candidate. He is a Ballarat boy, he is somebody who’s represented his country, he knows what it is to work hard. And I must say, of all the candidates that I’ve ever campaigned with, I think Russell Mark is truly one of the most outstanding candidates. He aims to win the trust and support of the people of Ballarat, he has got every chance to do so, and I wish him well in that effort.

JOURNALIST:

How important is this seat to the Liberal Party?

TREASURER:

Very important. Look, the next election is going to be a close election. Most people reckon that Labor is the favorite, Labor reckons it’s the favorite. The Labor Party is already counting itself as getting ready for government…

JOURNALIST:

What (inaudible)

TREASURER:

…and we have to make sure that we hold seats like Ballarat to continue good government for the people of Australia. I’lI say this, look, the last time the Labor Party held Ballarat remember this, the home mortgage interest rates were 17 per cent. That’s what you were paying the last time the Labor Party held Ballarat, today it’s 6.8 per cent. It could so easily go back and if you did there’d be many families that couldn’t afford a home, families that would be under severe financial pressure and it’s important that we keep good economic management going in Australia. You don’t get that from the Labor Party.

JOURNALIST:

What impact do you think the requirements for Michael Ronaldson’s (inaudible).

TREASURER:

Michael was undoubtedly a very popular local member. He won Ballarat in 1990, he held it through four election campaigns, he had a lot of friends and supporters, but Michael is giving Russell his full support. Michael was very instrumental in talking to Russell and encouraging him to run, and Russell has got Michael’s full support, and (inaudible) got the good wishes of a number of people here and he is, as I said, one of the outstanding candidates I think for election in the next Federal election.

JOURNALIST:

Are you actually claiming (inaudible)?

TREASURER:

We’ve actually cut the petrol excise and abolished indexation. That means that under our policy petrol excise won’t be going up, but when the Labor Party was asked yesterday whether it supported our abolition of indexation they wouldn’t say they did and they wouldn’t commit to keeping that indexation abolished.

JOURNALIST:

(inaudible)

TREASURER:

So what is obvious is that the Labor Party now has a plan to increase the petrol excise. We abolished indexation. They won’t commit to keeping that abolition in place. If they are elected, they wouldn’t give that commitment, and rural and regional Victoria ought to know this: Beazley and Crean kept indexation in place during 13 years of Labor government, we abolished it, they have not given a commitment that they won’t bring it back. They won’t give that commitment because they fully intend, if they can get away with it, to bring back petrol indexation which would increase excise for all rural and regional motorists.

JOURNALIST:

Will you give a commitment that you won’t (inaudible) motorists?

TREASURER:

For which motorists?

JOURNALIST:

For those motorists (inaudible)

TREASURER:

Let me say what this Government has done. We give a full rebate on diesel excise for primary producers. We introduced a new system by which truckies get a rebate, a part rebate in relation to diesel which didn’t exist before. Under our Government, we gave a rebate to truck drivers. They are paying 27 cents a litre less in tax on diesel than they would have been under the Labor Party policy. We then abolished indexation on petrol which had been introduced by the Labor Party in 1983, so we have got the runs on the board for cutting diesel for farmers and primary producers, for cutting the cost for trucks and for abolishing indexation and helping motorists. And when the Labor Party was asked yesterday, do they match us on the abolition of indexation, they refused to say. They want to re-introduce indexation, I keep on saying it. They introduced it in 1983, they want to bring it back. It’s one of the taxes Mr Beazley is going to put up. He has to put up taxes. If you’re going to roll-back the GST you’ve got to put up other taxes. It’s obvious now one of the taxes that he intends to put up, is the tax on petrol.

JOURNALIST:

Mr Costello, what do you think of One.Tel going into voluntary receivership?

TREASURER:

Well, like anybody in Australia, I regret the fact that the company has got into difficulties. I don’t think anybody would welcome financial difficulty for One.Tel or for any other company in Australia. The directors have obviously got an obligation to comply with the law. It is obviously why they have appointed an administrator. I hope the administrator can maximise the value of the company and protect the creditors. That is a matter for the administrators, not a matter for government.

JOURNALIST:

Mr Beazley’s response to that is to say that he would introduce legislation to protect all workers’ entitlements when a company collapses. What do you think of that?

TREASURER:

Well, again it’s just something that he obviously doesn’t feel very deeply about.

JOURNALIST:

Would you be prepared to do the same thing?

TREASURER:

Well, you might ask me why doesn’t he feel deeply about it? Because in 13 years of government he never introduced a guarantee for anybody’s entitlements, not one dollar, not for one employee, not for one company. The only government that ever introduced a guarantee for entitlements is the Coalition Government. We introduced a scheme to guarantee entitlements up to a safety net which we fund 50 per cent and the State governments fund 50 per cent. No Labor State government has yet put a dollar into it, but the Liberal and National Party Federal Government has paid its 50 per cent liability. Now, nothing under Labor. We introduced the scheme, we pay our 50 per cent. No Labor government pays its amount and all of a sudden Mr Beazley’s got interested in the issue. It’s just an example of, he says things off the top of his head but I’d say to the public of Australia look at what he does, not what he says. He was in government for 13 years and he didn’t do anything.

JOURNALIST:

Mr Costello, about a half a million people, about a half a million people are going to be paying the top tax rate (inaudible) 4 years (inaudible) bracket creep?

TREASURER:

What we did about bracket creep is we dramatically reduced income tax rates.

JOURNALIST:

So it’s going to get worse?

TREASURER:

If we hadn’t cut income taxes on 1 July last year, average workers today would be on the top income tax rate. They’d be on 43 cents I should say, on 43 cents today, and it was by cutting income tax rates on 1 July last year that we freed average workers from that 43 cent rate. We’ve got average workers down to a 30 per cent rate. They would have been on 43 per cent, we’ve got them down to a 30 per cent rate. And you don’t go above a 30 per cent rate whilst you go through average wages in Australia. That was what our tax plan did, and we’re now 11 months into those tax cuts, but this is an illustration of the advantage of those income tax cuts. We took a person on average wages, who would have been on a 43 cent marginal tax rate and we cut it to 30 cents. We cut it from 43 cents to 30 cents, and the Labor Party opposed us every step of the way. They opposed that plan, and if we hadn’t have been able to put that tax plan in today the marginal rate, the top marginal rate for a person on average earnings would be 43 per cent, but it is only 30 per cent. That is one of the advantages of income tax cuts that we put in place on 1 July 2000.

Thanks.