KIERAN GILBERT:
Joining me is Mr Morrison, thanks very much for your time. First of all, I want to ask you about Wall St, the Dow through 21,000 points off the back of the Trump speech – it’s quite something, isn’t it? This is less than a month after it hit the previous milestone of 20,000 points.
TREASURER:
This builds on some earlier excitement and it’s about the agenda. They’re investing in infrastructure, getting company tax rates down, this was a very clear speech about a very strong economic direction and people have responded well to that. Now, we wanted to get company tax rates down, we had good results yesterday obviously in the national accounts. There is, I think, a growing appetite for optimism out there and it remains to be followed through on, of course. But I think there was a very strong statement about economic direction, investing in infrastructure, ensuring that companies can be profitable so that businesses can grow and that people can get jobs and have higher wages.
GILBERT:
I want to ask you about locally, John Fraser, your Treasury Secretary had some very clear message to the Government to not just spend any windfall from higher commodity prices. He says it needs to be banked, additional revenue to go into Budget repair…
TREASURER:
That’s right. He’s absolutely right. It’s actually our fiscal strategy, it’s set out in our Budget documents and our MYEFO statement…
GILBERT:
So no temptation to spend any of that?
TREASURER:
Well, you can’t. In the last 18 months, we’ve had some $70 billion worth of revenue write-downs which have been a function of lower wage prices, commodity changes previously. Now, you don’t chase it up the hill or down the valley and if there is an improvement – if and I don’t think people should leap to that conclusion, that in the Budget there would be any uplift because while commodity prices had been stronger particularly in the December quarter and played heavily into the result we got in that quarter – there’s no consensus about how long they may remain. And on top of that, there remains the real challenge of what has been very sluggish wage growth at 1.9 per cent on the wage price index. What you pick up on the swing, you can lose on the roundabout in this area but John is right, that is the Government’s actual fiscal policy, that if there is any improvement as a result of those things then that goes to paying down the debt and consolidating the Budget.
GILBERT:
But it refers to the experience of the 2000s which structurally weakened the budget, in the words that he used, during the mining boom of the Costello-Howard years.
TREASURER:
Well, you’ve got to look at your spending on a structural basis and you’ve got to do it outside these peaks and troughs of commodity cycles. You can’t build your Budget on those movements. It’s got to be on what you can sustainably afford over time and we’ve got expenditure, as a share of growth down from over 3.5 per cent which is what we were left by Labor to less than 2 per cent. Now, that also assumes getting a lot of these measures through and the Labor Party is out there looking to crash the Budget and to crash the AAA rating just for their own political advantage.
GILBERT:
Still we could talk about the Labor Party but you don’t need enemies when you’ve got people on your own side questioning your strategy, like Eric Abetz today in the Fairfax papers. He says that the Fair Work Commission should use its powers to grandfather the penalty rates in place. This goes against what you’re saying. You’re saying that we should respect the independent umpire. He says, ‘Well, no. Those on current penalty rates should stay as they are’.
TREASURER:
Well, Eric’s entitled to his view but the position I’m putting forward is the position we took to the last election that we said we would respect the independent umpire on this and that’s exactly what we’re doing.
GILBERT:
But when you’ve got a former Workplace Minister, a former Leader of the Government in the Senate, intervening at a time – a very sensitive time in this debate – it doesn’t help, does it?
TREASURER:
He’s entitled to his view but it’s not Government policy.
GILBERT:
Would you urge individuals, former Ministers to rein it in?
TREASURER:
He’s entitled to his view. Eric can make these comments. That’s up to him.
GILBERT:
Does it diminish your argument, at all, having his point made like that? Given the former Liberal Party Workplace Minister?
TREASURER:
No.
GILBERT:
So you’re quite happy about it?
TREASURER:
I’m not distracted by it. I’m focused on the Budget, lots of people have lots of opinions, they’re free to express them but it doesn’t change the task that I have and the Prime Minister has and that is to make sure that we continue to consolidate the Budget, that we continue to drive investment that supports people’s jobs. Others will have all sorts of views, they’ll express them on this programme, other programmes, late at night, early in the morning, that’s up to them. But the Government is rock solid focused on driving the economy forward.
GILBERT:
The 457 ban for migrant workers in fast food outlets?
TREASURER:
Yes.
GILBERT:
Should this have been done before?
TREASURER:
I’ve seen the report today and I commend Peter on taking the action he did. This was an agreement signed back in 2012, I understand, by Chris Bowen with Bill Shorten as Employment Minister. These are guys that run around town saying that they want to stop 457s. Well, they set the records on these sorts of things so it’s for them to explain why they with three other unions actually put that agreement in place. It’s for them to explain that.
GILBERT:
Well, now that it’s being removed, you hope that would open up opportunities for younger workers, like the penalty rate, and that’s the point that Ian Ross made, the Fair Work Commissioner…
TREASURER:
Yes and Ian Ross, handpicked by the Labor Party to do this job and come up with that decision. It may not be the decision that they thought he would make but he’s made that call. He’s seen the evidence. The Productivity Commission has come to similar findings about these things and what I’m looking to going forward is how this actually plays out in the employment market and [inaudible] will teach us what the actual result will be.
GILBERT:
Simon Benson in The Australian today reports that it could effect as few as 285,000. Is that true?
TREASURER:
That report he’s got, I’ve got no reason to doubt that and it does beg the question whether Labor are completely over egging the story on this. Yesterday, we had the National Accounts come out and the Shadow Treasurer didn’t ask me one question on the National Accounts. I mean, he’s been in hiding since the national accounts came out. He’s usually quite quick to come out and commentate on these numbers – haven’t seen boo from him.
GILBERT:
Mr Morrison, thanks for your time. Nice tie by the way.
TREASURER:
Sharks, Broncos, tonight, season opening. All very excited and so hopefully the Parliament will rise at five so that I can be at Shark Park at eight.
GILBERT:
I think there’s a fair chance. Thanks very much – appreciate it.
TREASURER:
Thanks.