The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
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Wayne Swan

Deputy Prime Minister and Treasurer

3 December 2007 - 27 June 2013

21 March 2012

Interview with Sabra Lane

ABC Radio, AM Program

SUBJECTS: Minerals Resources Rent Tax; tax cuts for businesses; Clive Palmer's CIA conspiracy theory and influence in Liberal Party; Government's successful response to the GFC

Lane:

Wayne Swan, thanks for joining AM.

Treasurer:

Good morning Sabra. Good to be here.

Lane:

How confident are you that the Minerals Resource Rent Tax will withstand a High Court challenge by Andrew Forrest and possibly Western Australia?

Treasurer:

Look I'm very confident. It's a bit like a company tax. It's entirely constitutional. I'm confident it will survive that scrutiny. You see we're just seeing the wrecking tactics here from Mr Barnett, Mr Forrest and Mr Abbott, really.

Lane:

You say you're confident but the Government was confident too in its Malaysia swap challenge in the High Court and that failed spectacularly.

Treasurer:

Well, I think the history of that is well known. But the Government is very confident here. We've received our advice and we're acting on that advice.

You see Sabra, this is a very important economic reform for Australia. Not everybody is in the fast lane of the mining boom. That's why we do want to deliver very significant tax breaks for 2.7 million small businesses as well as this very big boost to superannuation for 8 million working Australians.

Lane:

Campbell Newman says if he wins the Queensland election this weekend that he'd prepare first to sit down and negotiate with you and ask you nicely and if that doesn't work he's prepared to look at following the states as well.

Treasurer:

This would be very bad for the mining industry if Mr Newman were to do that and I think he would find very substantial opposition there. You see, most of the responsible industry are out there supporting profits-based taxation. They don't think that increasing royalties is the way to go.

Lane:

The Shadow Treasurer, Joe Hockey, says he expects that the big miners will reshuffle their affairs, restructure their affairs and that they won't have to pay this tax for many, many years.

Treasurer:

Well, Mr Hockey is opposed to the tax. This is another example of Mr Abbott's wrecking tactics.

Lane:

But the substance of his point?

Treasurer:

Well, the substance of his point is that it is wrong.

Lane:

The associated tax cuts for corporate Australia certainly aren't assured and the Greens have said that they'll only support legislation to guarantee the cuts for small business, not big business, and they insist they're not going to buckle on this. How are you going to get this through?

Treasurer:

Well, let's just go back through the history here. The Greens always said they weren't in favour of a corporate tax cut across the board but Mr Abbott, until the end of last year, was supporting that tax cut. And Mr Abbott is the one…

Lane:

Mr Abbott is not in government and you are.

Treasurer:

That's right, but Mr Abbott has the numbers in the Senate and he can get this through. It is massively irresponsible of Mr Abbott to try and sink this corporate tax cut, which is so important to all of those businesses that aren't in the fast lane of the mining boom. So the weight is really on Mr Abbott.

We're going to do everything we possibly can to get this through the Senate and we're going to put the pressure on Mr Abbott and on the Greens to support this cut because what will happen in the Senate on what they are saying at the moment is the Greens and the Liberals will vote this down.

Lane:

I'm sure that his arguing point would be that if you want him to pass this hand over the keys to The Lodge. He'll do everything else.

Treasurer:

Well, it just shows Mr Abbott is prepared to wreck anything to achieve his political aims.

Lane:

This leaves the prospect of a two tiered tax system for Australia come July 1 this year, with the suggestion that companies will restructure their affairs to reduce their tax bill. That's a pretty crazy prospect.

Treasurer:

Well, I think business wants this corporate tax cut. It's very important in terms of economic reform for Australia. We will continue to fight for this in the Senate. And I believe the business community is going to put enormous pressure on Mr Abbott to act responsibly, to stop these wrecking tactics.

Lane:

Well, employers are now putting pressure on you. They say that future wage rises should factor in the rise in compulsory superannuation costs to them. The Australia Industry Group wants you to require and legislate for Fair Work Australia to factor that in when they're determining minimum wage outcomes. Will you do that?

Treasurer:

Well, first and foremost, this SG increase, the superannuation guarantee from 9 to 12, is phased in over six years.

Lane:

And employers will pay it.

Treasurer:

And it will be on the table when there are wage negotiations along with a whole range of other matters and it's not for the Government…

Lane:

Will you legislate for Fair…

Treasurer:

No I won't. I will not because it is not for the Government to dictate those discussions between employees and employers. We have had an enterprise bargaining system in this country for a long period of time. It's been very successful. It's lifted productivity in this country. And these are matters to be discussed at the bargaining table.

Lane:

Mining magnate Clive Palmer has suggested that the CIA is in cahoots with the Green movement here to stop coal exports. What's your view?

Treasurer:

Well, Mr Palmer is in cahoots with Mr Abbott. He is the Liberal Party's biggest donor and one of their biggest supporters, not just in the state of Queensland, but right around the nation. His behaviour is increasingly erratic and bizarre. But he pulls the strings in the Liberal Party. I think those questions are better directed to Mr Abbott because they are in a very, very close partnership.

Lane:

You made history yesterday, becoming the first Deputy Prime Minister and first Treasurer to be booted out of Parliament. Do you regret installing Peter Slipper as the Speaker now and do you regret saying what you did?

Treasurer:

No we don't. I mean, I won't take a backward step when I'm standing up for the small businesses of this country and the 8 million workers who stand to benefit from an increase in their super. It was a pretty willing debate but the Liberal Party is using their wrecking tactics on the floor of the Parliament all the time.

Let's just think about the context. What I did yesterday was refer to the Three Stooges because, as you know, Liberal Party economic policy has been a shambles in recent time with a $70 billion crater in their budget bottom line. And I simply made a reference to Curly, one of the Three Stooges, and of course that did deliver the ruling from the Speaker.

Lane:

The Auditor General has handed down another damning report into a bicycle path program which was part of the stimulus package. It found that no money was actually spent the first six months of that program and that there was no way of actually assessing the jobs that were created under that program. That's again not a good look for your Government.

Treasurer:

Well, let's just get this story into perspective. This is about expenditure of $40 million …

Lane:

So it doesn't matter?

Treasurer:

…in a $1.4 trillion economy. We had the most successful stimulus of just about any developed economy in the world. This country avoided recession because of the measures that we put in place. So a newspaper today has highlighted a $40 million expenditure which was delayed.

Lane:

It's the Auditor General that's highlighting this, not just a newspaper. It's the Auditor General.

Treasurer:

Well, what I'm doing is putting this into perspective because what the newspaper has done, I believe, is take it out of perspective. We are dealing with a $40 million expenditure which was delayed. We have a $1.4 trillion economy. We had a substantial stimulus which saved this country from recession, which kept hundreds of thousands of Australians in employment and kept the doors of tens of thousands of small businesses open. It doesn't reflect on the stimulus that one small program was delayed.

Lane:

Mr Swan, thanks for your time.

Treasurer:

Thank you.