Patricia Karvelas:
For the government’s view I want to bring in Andrew Leigh – another Andrew, the Assistant Minister for Productivity, Competition and Charities. And just to note, we are standing by to hear from the Queensland Police about some counterterrorism charges which of course is a pretty important breaking story. So we’ll bring that to you as soon as it’s happening. Andrew Leigh, welcome.
Andrew Leigh:
Thanks Patricia, great to be with you.
Karvelas:
Just on where I ended there, I think it’s only fair to start again with you, and that’s these second‑hand subs that are not good enough. Andrew Hastie says we should have actually got a better deal. Why are we just getting some second‑hand subs when we’re spending so much money on AUKUS?
Leigh:
Patricia, when we came to office we were faced with a serious sustainment challenge. The Coalition, as you recall, had said that they would buy French submarines and then backed out of that and left us with a significant capability challenge.
So it’s left to Labor to ensure that the Collins‑class submarines have that extension of life project and also that we’re able to fill the gap between when the new AUKUS‑class submarines come in. That’s an important measure that we put in place. Of course, if you were starting doing this afresh, you would have made better decisions in the 2010s, but this is the best deal for Australia from the situation we face now.
Karvelas:
Okay. But why do we just accept whatever is offered to us when we had a deal and it’s not being honoured?
Leigh:
Well it is, and we’re working systematically towards that, and that is part of the AUKUS agreement. But those new subs don’t arrive until the 2030s. That was the agreement as it was made by the Morrison government. What we’re doing now is putting in place additional capability, which is important in our region. Richard Marles’ speech to the Shangri‑la…
Karvelas:
Sorry Andrew Leigh, I’m going to have to cut into that and take you now to Queensland Police that are giving an update on a 13‑year‑old boy who’s been charged with counterterrorism offences.
[Live cross]
Karvelas:
And that was Queensland Police’s counterterrorism unit speaking about a 13‑year‑old boy who was arrested and charged for allegedly threatening people. As just revealed there, it was in relation to something that was being orchestrated in relation to a school. That was obviously a press conference by the Queensland Police about that arrest.
It looks like the public – I’m about to be joined now back again by Andrew Leigh. Andrew Leigh, you politely waited. Of course we had to take that press conference for very obvious reasons. I just want to take you back to your Budget though. It looks like the public has mostly rejected the Budget. It’s very unpopular and in fact the poll by Redbridge shows that it’s so unpopular it’s even leading to a surge in support for One Nation – they’ve now trumped your party. Why can’t you convince people that this Budget is good for them?
Leigh:
Well Patricia, I don’t take polls particularly seriously and that goes back to a time when I was a professor at ANU doing work showing that polls have very little predictive power. At the beginning of last year, Peter Dutton was clearly ahead in the opinion polls and indeed if you look back in history, moments in which governments have done serious reform have sometimes seen them slide backwards in the polls.
That was true when the Hawke government introduced fringe benefits taxation and capital gains taxation in 1986. It is often true when you do hard things that it takes a while as you work through the conversation with the Australian people. But the alternative is to do nothing about the home‑ownership rate falling for young Australians and the tax system being so skewed towards unfairness.
The Budget reforms give you a sense of the ambition of the Prime Minister and the Treasurer. And it is important that we continue to engage with people about the fact that those small business concessions are still available, that inflation indexation for capital gains taxation will be more generous for many asset holders, and just get those facts out there as we look to sell the Budget reforms.
Karvelas:
But maybe they’re unpopular because people just don’t like them and don’t agree with you?
Leigh:
Look, we’re facing an Opposition which as it’s done in the past when it opposed Medicare, opposed universal super, opposed capital gains tax, of course it’s now playing its usual role of blocking and opposing. It’s up to Labor to play our natural role of the reforming party in Australia. We will do that, and that involves a conversation with Australians about the importance of getting home ownership back on track.
What we are seeing is record investment in housing – some $47 billion, which will see over 400,000 new homes as a direct result of the government’s measures. These are ambitious reforms, they’re reforms that Australia needs and the last thing we can do is to just step back and say, ‘Well, we won’t bother doing any serious reforms’. That would take us back to that awful period of 2013 and 2014 when Tony Abbott was Prime Minister and we don’t want to repeat that sort of model for Australian politics.
Karvelas:
Okay. So taking you to the housing changes, is there a risk of some properties falling into negative equity?
Leigh:
Look, we’ve seen a modest fall in house prices over the last couple of months but generally in most markets they’re up over the year. Our estimate is not that there’s going to be significant falls in house prices as a result of our measures but that the house price growth will be moderated. We need house price growth to rise more in line with wages. It’s been outpacing wages quite considerably over the last couple of decades.
Karvelas:
Yeah.
Leigh:
I talk to young couples who just say, ‘Look, we had the deposit, we went in auction, we had a go and then a few months later we found we were out of the market’. Imagine how deeply dispiriting that is for a young couple, a firey and a teacher who find themselves locked out of the housing market. We can’t keep going on like that.
Karvelas:
Okay. But you didn’t address my – you talked about it moderating, I get that. But some people will go into negative equity, won’t they?
Leigh:
Look, what we’ve seen is changes in the housing market which are largely affecting the mix. We’re seeing more first‑home buyers getting into the market, fewer investors, but over the course of the year, we’ve got house prices up in most markets.
The Reserve Bank’s decisions around interest rates are probably having a bigger impact than the government’s policies, particularly given that our policies haven’t yet been legislated.
Karvelas:
Pauline Hanson says she could be Prime Minister. Do you think she could be?
Leigh:
Look, Pauline Hanson has led the most scandal‑ridden party in Australian political history. Hers is a party that has solicited money from the NRA in the United States to water down Australian gun laws. The vast majority of her elected members have left the parliament before the end of their first term. She’s overseen physical altercations in parliament that have left blood smeared on office doors. Pauline Hanson recently held a fundraiser in which she got on Gina Rinehart’s plane and flew around Sydney with Barnaby Joyce in order to raise money from donors in the midst of a fuel crisis. She is out of touch.
Karvelas:
I get all the things you say that you don’t like about her and her politics. But my question is, do you think she could win lots of seats and be in line to possibly be Prime Minister?
Leigh:
Patricia, I think Australians are better than Pauline Hanson takes them for. She reckons that pure grievance and grumbling will get you elected. What Australians actually want is policies that will make a positive difference for their lives.
We’ll have a Fair Work decision handed down tomorrow where Labor has backed an economically sustainable increase in wages. You don’t hear Pauline Hanson doing that because her financial backers don’t want her to back real wage increases for Australians. You don’t see Pauline Hanson out there backing universal healthcare and the expansion of Urgent Care Clinics right across Australia.
Karvelas:
So you think Australians will take a look at her and that this won’t materialise at an election?
Leigh:
I think Australians, the more they get to know Pauline Hanson will realise that she’s just in it for the social media grumbling and not for actually doing the hard work of serious policy.
Karvelas:
She’s been around for 30 years though, she’s a known quantity isn’t she? She’s not some brand‑new political player?
Leigh:
She has, and name one positive policy that she put up in that time?
Karvelas:
That’s not for me to do. The question is people have taken a really long look at her and they’re parking their vote with her?
Leigh:
Look, what she’s doing is complaining about immigration, she’s complaining about trust, but she’s failing to put forward the solutions that would make a positive difference.
You don’t become Australian leader by demonising migrant communities, as Pauline Hanson has made a practice of throughout her career. This sort of divisive, nasty politics – which I’ve got to say is pretty much characterised by Tony Abbott, you know, if you want a dose of culture wars alongside your climate denial, then Tony Abbott or Pauline Hanson will serve it up to you. But neither will put in place the sort of policies we need to boost home ownership, get more Australians a fairer tax deal.
You know our tax package Patricia, makes changes to negative gearing and capital gains so we can deliver more tax cuts to the average Australian, around the order of $2,800 in tax cuts, including a new Working Australian Tax Offset. That’s the sort of reform Australia needs.
Karvelas:
Andrew Leigh, thank you for joining us.
Leigh:
Thanks, Patricia.