20 January 2016

Interview with Peter van Onselen, PVO NewsHour, Sky

Note

SUBJECTS: Section 46; foreign investment; Liberal Party preselections; Tax reform; budget repair.

VAN ONSELEN:

As promised we’re joined now live out of Melbourne by the Small Business Minister, also the Assistant Treasurer, Kelly O’Dwyer. Thanks very much for your company.

MINISTER O’DWYER:

Great to be with you Peter. Happy New Year.

VAN ONSELEN:

And to you. Now your predecessor in the role of Small Business Minister, Bruce Billson, has warned the Turnbull Government that it risks looking like it has caved into big business interests if it doesn’t introduce an effects test to curb their market power. Is that a concern that you have?

MINISTER O’DWYER:

Well certainly we need to consider the issues of competition very carefully but the Government doesn’t believe that you favour one competitor above another or that you stop people from competing in the market place. We’re looking at the proposals that were put forward by the Harper Review, of which you speak. I’m actually holding some round tables, in both Melbourne and Tamworth next week, to talk with business both big and small about the issues that they want to put on the table around competition and potential competition changes. As Small Business Minister I will take those views on board and put them to the Treasurer who is ultimately responsible for making a decision and taking that to the Cabinet.

VAN ONSELEN:

But even Harper himself seems to have retreated a little bit from his own review with some comments since that time. Is that a sign, perhaps, that the Bruce Billson angle is going to be very much a watered down one now that he’s no longer the Minister?

MINISTER O’DWYER:

Well look, I want to take personalities out of this. I know that everyone who has expressed their view has done so because they feel it very keenly. I want to take personalities out of it and actually look at the facts. That’s what we’re going to be doing at the roundtables that we’re holding next week. There is a process on foot as well for people to contribute to a review of Section 46 and potential competition changes and we’ll consider all of the views that are put to us very factually, very sensibly. Ultimately we’ll take that to the Party Room and then we’ll take it to the electorate.

VAN ONSELEN:

Can I ask you about foreign investment in residential real estate? You’ve had a lot to say about that and there has been some movement in that direction that was started I suppose by Joe Hockey and is now being continued by the new finance regime within the Turnbull Government. Is there a conflict here though, or at least a perceived one, between, you know, what is being done to curb foreign investment in residential real estate – to some extent anyway – and the desire I suppose, to have foreign investment via residential real estate as a sort of a tool of small business. If I can put it this way, you’re kind of the ham in the sandwich in this one.

MINISTER O’DWYER:

No I don’t think so. I think it’s important to understand exactly what the Government is doing in relation to foreign investment and residential real estate. Many moons ago when I was chair of house economics committee, on behalf of the Treasurer I conducted an inquiry looking in to whether or not our foreign investment framework was fit for purpose, whether it was actually delivering on its goals and whether there were any amendments that needed to be made around residential real estate. What we found was that while we had clear rules in place that encouraged foreign investment in to new dwellings which had a very positive impact on stimulating our economy, in actually increasing the dwelling stock available, we also found that the rules that prohibited foreign investors, non resident foreign investors, purchasing established homes was not in fact being enforced and there are very real reasons for those rules. When people are looing to invest in established property they’re not increasing the dwelling stock, so its not directly in the national interest for them to be purchasing those dwellings. So what the Government has done is it looked at what changes ought to be made and it accepted the recommendations made by that inquiry that I Chaired along with my colleagues who were involved in it. It was a bipartisan committee report that said that you needed to take away the incentives for people were are very deliberately flouting the law, you needed to make third parties who were giving advice to people to flout the law – you had to give them penalties as well – and you needed a better way to match up the data so that you were indeed cracking down on those people who were doing the wrong thing. And already we’ve seen results of that with the announcement by the Treasurer, only the other day, that now 27 properties have been divested that’s as a result of the Government, the Government’s announcement and the Government’s changes to the rules to make sure that we enforce those rules.

VAN ONSELEN:

How is a busy new Minister, juggling family and the summer period, trying to get across multiple portfolios, Assistant Treasurer, Small Business Minister, supposed to be able to maximise their opportunity to do all of that if they’re Chief of Staff takes a leave of absence and starts flirting with the concept of running for the Senate.

MINISTER O’DWYER:

Well I think a lot of people over the Christmas period actually do take a wee break and my Chief of Staff only took that period as a break. I’m very pleased that I’ve got a fabulous Chief of Staff and I have been able to keep him but a lot of people, as you know…

VAN ONSELEN:

Is the risk that he’s going to come back haggard Kelly O’Dwyer with all of those phone calls and lobbying that he presumably must have done as he was considering running for the Senate?

MINISTER O’DWYER:

Well no he’s been back on deck for a while now and he’s doing a fantastic job.

VAN ONSELEN:

What do you make of James Campbell’s comments, you may or may not have heard them, yesterday here on Sky News – obviously you’d know he’s the State Political Editor at the Herald Sun. He was saying that the move away from support by Michael Kroger for Tim Wilson for an alternative candidate was all about blocking the Kelly O’Dwyer faction in the Victorian Liberal Party, which would have potentially seen Julian Sheezel becoming a Senator?

MNISTER O’DWYER:

Well I didn’t hear the comments. I can tell you, you know it’s going to be very boring for you to hear this, but I’m – as you pointed out before – there’s plenty for me to focus on in my own portfolio. I harbor no ambitions to be a factional warlord and in fact, you know some of those people who claim to be such don’t exercise much influence because at the end of the day it falls to preselectors and party members who are in fact the grass roots of our Party to make those decisions about what’s in the best interests of our Party – as it should be.

VAN ONSELEN:

Alright, one more on this but we’ll go to New South Wales and then we’ll get back to your portfolio duties. What do you think of the looming challenges that seem to be underway in New South Wales to long term sitting members like Bronwyn Bishop and, for example, Philip Ruddock? I mean Philip Ruddock has been in the Parliament for nearly 43 years, it’s a bit rough isn’t it not to give him another seven so that he can hit the half century?

MINISTER O’DWYER:

Well again, it is a matter for preselectors to determine who best represents the Liberal Party in their particular electorate and its for the electorate to decide whether they think that person is the best person to represent them. I’ve got a number of really fantastic colleagues.

The Prime Minister has been very clear that he supports sitting colleagues, but no one pretends that you have a job for life in this business and you know, given that we have to come on shows like yours Peter where we get interrogated I don’t know that anybody would wish to have this job for life!

VAN ONSELEN:

What are you saying? I’m feeling very isolated and unloved over here in WA, with comments like that, and you know anyway. We do appreciate you coming on the program and one of the reasons is to talk policy, so let’s get down to it. There’s cracks in the Labor side between State and Federal Parliamentarians and indeed, leadership groups when it comes to the GST. Luke Foley has indicated a very narrow willingness to look at the idea of a GST, as a State Labor Leader, but it gets shut down time and time again by anyone and everyone in the Federal Labor Party that you talk to. Is the Government prepared to have a ding-dong battle on changes to the GST? I’m not asking you to give me an exclusive on what those changes might be. But are you up for the fight in what could otherwise be a difficult election year, in a policy area where we need change according to what most economists tell us?

MINISTER O’DWYER:

Well, we are most certainly prepared to have an absolutely real discussion with the Australian people about making sure that our taxation system is fit for purpose and is going to make our economy more competitive. There’s no question about that. That’s our job to do that. And I think Australians expect us to do just that given that we form the Government. In terms of what the Labor Party is doing, I can’t give you any insight on that. It’s very confusing to really understand their position day to day. All I have really heard from them in relation to tax, is that they would like to tax people more. When we talk about changing the tax system, we’re talking about, as I said, making it more competitive – lowering the overall tax burden, making sure that we can fix some of the problems that we know exist. It’s ridiculous to think that somebody who is an average income earner will be on the second highest tax bracket next year. I mean it’s just pretty extraordinary to think that it’s come to that. So, there are some genuine issues that we know we need to deal with and we are looking very closely at how we can do that. Now, we know that the states as well, when it comes to taxation, have their job to do in terms of getting rid of a whole host of inefficient taxes. As I said before, any discussion about tax, is not simply about putting up taxes but also getting rid of a whole host of taxes that are holding our economy back and making it less competitive. So, it’s a debate we all have to have. I think it would be very useful if the Labor Party engage in this debate in a productive and constructive manner rather than simply trying to play pure politics on it.

VAN ONSELEN:

Yeah well good luck with that one, I don’t like your chances. Don’t hold your breath - you might go very red. Let me ask you, one final area that I would like to canvass. Your fellow Cabinet colleague, Senator Michaelia Cash has a want to say, she’s done it in an interview with me with Christina Kenneally on ‘To the Point’ and she did it at her media conference with the Prime Minister, Malcolm Turnbull, announcing IR changes in the wake of the Royal Commission findings. She says that the Liberal Party, the Government, the Coalition is paying down Labor’s debt. You’re the Assistant Treasurer, can you help me understand how that is happening, given that we don’t have a surplus?

MINISTER O’DWYER:

Well what we’re doing is we are definitely putting Australia back on the road to budget repair. Labor, during their time in Government, made a number of announcements that were completely unfunded and it’s fallen to our Government to make sure that we can fund those commitments like the National Disability Insurance Scheme…

VAN ONSELEN:

But just to be clear you’re not paying down debt just yet – that’s the aim.

MINISTER O’DWYER:

Absolutely the aim is to pay down Labor’s debt and we need to do that by being on the path to budget repair. Now we have already embarked down that path – there is absolutely more work to be done there and we are being fought every step of the way by the Labor Party who’ve got no solutions, have got no ideas other than to increase taxes about how we can better ensure that we control our spending. They’re very good at spending, they’re not very good at controlling spending. In the Mid-Year Economic and Fiscal Outlook which was released by the Finance Minister and the Treasurer, we’ve been able to get that expenditure to around about 26 per cent but it needs to be a lot lower than that. In order to get to a surplus it needs to be around 25 per cent of GDP, and that’s what we’re aiming for.

VAN ONSELEN:

Yeah well I think we can end in an agreement at least on the idea that Labor does appear to be chasing increased spending that’s unsustainable down the rabbit hole by searching for more revenue, but we’ll wait and see what happens in the May Budget – assuming that it is pre- election rather than post election. Kelly O’Dwyer, always appreciate your company on News Day. Thanks once again.

MINISTER O’DWYER:

Great pleasure Peter.