15 February 2019

Interview with Alan Jones, The Alan Jones Breakfast Show, 2GB & 4BC

Note

Subjects: Border security; floods in North Queensland; Labor’s retiree tax; Labor’s housing tax; and mortgage broking.

This is a transcript of the Hon Josh Frydenberg's interview with Alan Jones on 2GB. The main topics discussed were floods, mortgages, tax and border security.

ALAN JONES:

Treasurer, good morning.

JOSH FRYDENBERG:

Nice to be with you, Alan.

ALAN JONES:

Thank you. Can we just go to this Phelps’ Bill first. People find it extraordinary that Phelps,  representing a long-standing Liberal electorate, voting with Labor and the Greens. Julia Banks, elected to represent a Liberal electorate and is still the representative of that Liberal electorate, voting with the Greens and Labor.

JOSH FRYDENBERG:

Well, it was so disappointing to see Bill Shorten’s actions this week in the Parliament because we’ve seen this movie before. The last time Labor were in charge of our borders, they weakened them. There were 50,000 unauthorised arrivals, 8,000 kids ended up in detention, 17 new detention centres, lives were lost and there was a $16 billion blowout to the budget. So, for your listeners, Alan, that is money that could have been spent building 1,000 new primary schools across the country or a hundred new major hospitals.

ALAN JONES:

And so Labor and all of these people rejected all the advice and this humbug about Manus Island and Nauru weren’t getting the care they need. But, people understand that there were sixty-four medical professionals on Nauru, do they understand that under this Bill you don’t have to be ill, you simply have to be brought to Australia for an assessment. But, we already have that mechanism, don’t we? The Transitory Persons Committee within the Department of Home Affairs.

JOSH FRYDENBERG:

Look, there is of course the necessary medical support already being provided. But this is not about what actually will make a difference on the ground. This is all about the politics and Bill Shorten and the Greens playing to their left wings of their parties. Now, as a result of the decision by the Parliament and of Bill Shorten, we’re going to need to re-open Christmas Island, we’re going to need to make provisions to bring these people to Australia and this is going to cost the budget $1.4 billion. That’s money that could have otherwise been spent on hospitals, on schools, on roads and necessary infrastructure and it is all because the Labor Party are outsourcing their border protection policy now to the people smugglers.

ALAN JONES:

But, they don’t have to be sick, do they? Under this Bill, you just have to seek medical assessment. It’s  a very, very low threshold and where the current system exists whereby that medical treatment can be outsourced to other countries, this Bill provides, specifically, that they have to come to Australia.

JOSH FRYDENBERG:

And, as the Immigration Minister, David Coleman, has pointed out, a backpacker from Norway wanting to come in on a visa, will face a stricter character test than these people coming from Nauru and Manus. So, it’s really absurd what the Labor Party has passed through the Parliament here, and I think they will come to regret it.

ALAN JONES:

Well, just one final thing on this. I mean these are all Kerryn Phelps’ doctor mates, they’re all lining up to sign off. So, there is what 300 who are already reportedly who have the documentation complete. How many are likely to follow?

JOSH FRYDENBERG:

Oh, look, the numbers will be very significant and of course, it’s the message that is also being sent to the people smugglers, that they know if the Labor Party were to get their chance on the Treasury benches, that borders would be weakened as they were under Rudd and Gillard and the result is there for everyone to see. 50,000 unauthorised arrivals, a budget blow out, kids in detention and tragically, lives lost at sea.  And,  Scott Morrison and Peter Dutton have done an enormous amount of work with our defence force and our intelligence and enforcement agencies to get Australia into the position that we’re in, where we have border policies that have worked. We’ve got every single child out of detention, we’ve closed detention centres. I mean, the policy has worked. Other countries are looking at Australia and saying “how can we repeat that success?” Yet, the Labor Party, complacent, showing hubris, are now promising to undermine Australia’s strong border protection.

ALAN JONES:

Now, I will be talking to you further so there are a couple of things that I would like to talk to you  about and we won’t get time today because one thing that exists now with absolute urgency, and I haven’t discussed this with you at all, but I have in fact written to the Prime Minister. I don’t think any person in Australia, Josh, understands the gravity of what has happened in North Queensland and the Prime Minister is there today, which is magnificent, but even he won’t be able to see it. There is an area underwater, twice the size of England. There are at least 500,000 animals dead. The temperature yesterday was thirty nine degrees. Farmers tell me there is no way in the world they will be able to bury these people - animals, these carcasses, but they don’t know what to do with them. Fences are gone. Bob Katter indulgence in Question Time this week, call these calf factories and I’m sure you understand that the cow is carrying the calf, the cow dies and the calf is gone and that’s gone forever. And so, there is no income and no income stream and yet miles and miles of fencing is destroyed, sheds are gone, machinery is ruined and I’m saying to the Prime Minister, and you’re the Treasurer, now don’t blanche here, but why can’t you, this is big-time stuff, why can’t you give a 100 per cent, 100 per cent compensation to farmers in North Queensland and that may total $500 million. Now, if I could just explain before you fall off your chair. We did give one billion dollars to Indonesia, I might add, but this would have the flow on effect. It would enable people to start building fences, which employs people. It would pay for truck drivers to continue, they are now being retrenched, they could re-establish properties. It would pay for rural products, for cattle and for property. The employment would continue and a cost-benefit analysis, which I did on a rough rule of thumb last night, would indicate that the benefits would be greater than the cost, because without this, everyone is going to have to go on welfare. Workers will be laid off, farmers would have no income, there will be no tax paid. So, 100 per cent compensation on losses would rebuild towns and communities and give these people the kind of injection, emotionally and psychologically, that they need. What is your response? I know you would need time to consider, but do you have a response to that kind of proposal?

JOSH FRYDENBERG:

Well, Alan, let me say a couple of things. You are absolutely right, this is a horrific set of events and the people there in Queensland are suffering greatly and the Prime Minister has already taken a number of actions to ensure that these people get the support that they needed. He has been holding teleconferences with mayors, he has been speaking to the defence force, we have obviously discussed it at the highest levels of Government and importantly, he has already contributed over $100 million in financial assistance. And that 33,000 claims for disaster payments have already been processed…

ALAN JONES:

Yes, but Josh, Josh, Josh, we know all of that, listen, sorry to interrupt you. We know all of that. That is $1,000 for adults and $400 for kids. Listen…

JOSH FRYDENBERG:

There is a lot more money that is coming…

ALAN JONES:

But Josh, there are hundreds and hundreds of miles of fences that have to be repaired…

JOSH FRYDENBERG:

Absolutely…

ALAN JONES:

Now, this is going to cost hundreds of millions of dollars. Now, I’m saying, you’re a smart bloke, if I said $500 million on a cost-benefit analysis, the benefit from that $500 million is greater than the cost. You will continue productivity, people will continue to pay tax, workers will continue to be employed. At the moment, there is not only no income today, there is no income tomorrow, next month, next year. They are dead, they’re on the ground.

JOSH FRYDENBERG:

Alan, you’re making very important points and the Prime Minister is on the ground  now speaking to the local communities, in constant touch with obviously the Queensland Government. Our first priority, right now, is to give people the assistance they need. And, you’re right, there does need to be a rebuild. The impact on the cattle industry is enormous, I mean we’ve heard reports that near Julia Creek there was one cattle station that had about 70,000 head of cattle, and they’ve just only found about 1,000 today.

ALAN JONES:

I’ve spoken to one this morning, Josh. See, I just think what I’m talking about so you get simple language, a 100 per cent compensation for losses so that these people can get on with their lives. Anyway, I won’t prosecute that, I am happy to write to you about it if need be but you are the bloke with the purse strings. This is the time to allow Australia, it’s our money, Australia to get behind these people beyond the $1000…

JOSH FRYDENBERG:

And, we are behind them, we stand with them…

ALAN JONES:

I know you do, I know you do, you’ve got to prove that now and $1,000 for adults and $400 for kids won’t get anywhere near that…

JOSH FRYDENBERG:

It is much more than that is going…

ALAN JONES:

Yep, can I just take you to a couple of things because we will run out of time here in relation to the self-funded, you were very strong this week and specific, on self-funded retirees, prosecuting that case. And you argued, for example, that in the seat of McMahon, Chris Bowen’s seat, there are 3,000 retirees who have been told don’t vote for Labor. What are you saying to those people who are going to lose a significant component of their retirement income?

JOSH FRYDENBERG:

I am saying to your listeners, whether they are pensioners, self-funded retirees, the Labor Party is coming after your money because they can’t manage money. So, there are over a million Australians who will be impacted by this this new retirees tax, people who hold self-managed superfunds, individuals who don’t. And over half of these people are women and of those women, nearly 70 per cent are over the age of 60 and about half of them are either single or widowed. These are people who have saved money for their own retirement, planned for their own retirement, and now the Labor Party is changing the rules and coming after their money. And the hubris and the arrogance of Chris Bowen to say to these million plus Australians that if you don’t like what you see from the Labor Party, well vote against us. Well, I tell you what, they will vote against the Labor Party because the Labor Party is coming after their money and the Coalition stands with people who take personal responsibility for their own retirement.

ALAN JONES:

Well, haven’t they already acknowledged the draconian nature of all of this because they have exempted those people who were receiving the age pension in a self-managed superannuation fund before March 28. So, there are different rules for them from those poor coots who go on the age pension after March 28?

JOSH FRYDENBERG:

Well, that’s why pensioners will be affected by Labor’s policy. But also, don’t forget, if you’re in an industry fund, you may not be affected by some of the aspects of this policy…

ALAN JONES:

That’s it…

JOSH FRYDENBERG:

But, if you’re a self-managed superfund, you are. So, again, this is the Labor Party targeting a specific cohort of people who have shown thrift, personal responsibility and who have now saved for their own retirement.

ALAN JONES:

Well, doesn’t that rule also apply to a Capital Gains Tax? I mean, no one buys an asset to lose money and you just hope that it will improve in value. And now, they’re going to increase the tax on your Capital Gain, simple thing, by 50 per cent.

JOSH FRYDENBERG:

We’re going to have a Capital Gains Tax rate in Australia that is higher than the US, higher than the UK, higher than comparative countries, one of the highest in the world. We’re going to smash people who put investments into property, again they’re not necessarily wealthy people, but they can be the mums and dads listening to you who actually just want a better future…

ALAN JONES:

That’s a good point, this is any property. We’re not just talking about housing, this is any property.

JOSH FRYDENBERG:

And, you know what the impact is going to be? Not just on your houses, your house value is going to go down as a result of Labor’s policy, but for people who rent and there are millions of them in Australia…

ALAN JONES:

Through the roof…

JOSH FRYDENBERG:

They’re going to go up…

ALAN JONES:

Through the roof. Just come back to that, this is the negative gearing thing. Now, if for example, you and I and people listening decide that we’re not going to because they’ve taken the negative gearing benefits away. So, I’m not going to put my investment money into the housing industry. So, there will be fewer people then to buy your house, so your house is worth less. And, because there are fewer people going into the investment and  housing, there will be fewer properties to rent, so the rent will go up.

JOSH FRYDENBERG:

Well, this is right. If, under Labor’s policy, if you own your own home, it will be worth less and if you rent your house, you will pay more. Now, the Capital Gains Tax and the negative gearing policies are pretty bad, the retirees tax is pretty bad, that will send people to investments offshore, not in good Australian companies listed on our stock exchange which will create problems for those companies. Then, of course, you’ve got Labor’s plan to increase income tax, which even Paul Keating has attacked as targeting aspiration. You’ve also got other policies  from the Labor Party…

ALAN JONES:

Well, let me stop you there if I might, because I’m looking at the clock here and I want to ask you one question before you go because we will pursue this later. I want to ask you about mortgage broking if I could very quickly, though it’s not a quick thing to resolve. But, basically, the recommendation by Hayne seems to suggest to  me he doesn’t know too much about the mortgage industry, but is it the mortgage broker will have to be paid by the borrower. This would put more money into the hands of the banks and Labor says they will implement this.

JOSH FRYDENBERG:

Labor said, and this is Clare O’Neill, their Shadow Minister, we will implement Hayne recommendations, every single one of them. That is what they’ve said…

ALAN JONES:

The mortgage broking industry is gone…

JOSH FRYDENBERG:

And now there is 17,000 mortgage brokers employing around 26,000 people. They are in every corner of the Australian economy. They are responsible for over 50 per cent of the mortgages that are entered into…

ALAN JONES:

Ok, now that we’ve raised this, let’s stop and we will talk next Friday.

JOSH FRYDENBERG:

Look forward to it.

ALAN JONES:

And we will resume on this, these are very, very important issues. Thank you for your time.

JOSH FRYDENBERG:

Always good to be with you.