SUBJECTS: Resource Super Profits Tax, strengthening job seeker engagement with Centrelink
MARIUS BENSON:
Chris Bowen, all reports suggest today that that the Government is prepared to give ground on what has been one of the cornerstones of its super profits tax; that is, that it's prepared to consider raising the threshold at which a profit becomes a super profit from six per cent to maybe 11 per cent, maybe 12 per cent. Are they correct?
CHRIS BOWEN:
Well, Marius, as we discussed just yesterday we've engaged in a very genuine consultation process and that's been ongoing. I'm not aware of what recommendations may come out of that consultation process, but we've said that we'll take a very reasonable approach to implementation.
We're determined for Australians get their fair share of the mining wealth – the value of the minerals under the ground in Australia – but that we have a very genuine consultation process, and that's been ongoing. We've been taking a very reasonable approach, and of course it's incumbent on the mining industry to take a reasonable approach as well.
BENSON:
But does that reasonable approach allow a negotiation on that threshold, because Ken Henry, the Treasury Secretary, has said the integrity of the whole tax plan would be undermined were that threshold not maintained at six per cent.
BOWEN:
Well, Marius, I'm not going to go through the detail of what the consultation panel may or may not recommend to the Government, and how the Government may or may not respond. That's a process that's ongoing, but we've been very upfront about the fact that a major tax change requires significant implementation consultation and that's what we've been doing. There are various elements of the tax which are interrelated and they may need to be considered in total, and that's what the Government's been doing, and that's an ongoing process.
BENSON:
Can I just clarify what the state of play is with the negotiations? The miners have been meeting this consultation panel and the panel will report to the Government tomorrow, is that correct?
BOWEN:
I'm not, frankly, aware of when the report will be received by the Government, but I know it's an ongoing process.
BENSON:
So you're not aware of whether it goes to the Government tomorrow? That's being reported this morning.
BOWEN:
I've seen those reports, but whether that's the case or not is not something I'm aware of.
BENSON:
Chris Bowen, can I ask you about another issue which is in the news this morning, which is a report that the Government is tightening the circumstances in which – particularly young – unemployed people are able to receive welfare payments. They will, in future, have to satisfy tighter controls, including going to face-to-face interviews.
BOWEN:
Yes, this builds on a reform we announced last year, which is using technology to encourage and to require people to report to Centrelink more regularly. We're also strengthening the requirement for particularly young job seekers, job seekers under 25, early school leavers and people with a poor compliance history to report to Centrelink more regularly on a face-to-face basis. These will be more intensive interviews than has ever been the case before.
Interviews with Centrelink for job seekers have, in the past, been one minute long and about 30 seconds has been on what they're doing to find a job. We'll very substantially increase the intensive nature of the interviews to five minutes and they'll be very largely focused on what the job seeker is doing, whether they need any further assistance, but ensuring that the mutual obligation is reinforced in relation to those job seekers.
In Australia we've been able to get through the global financial crisis with unemployment the lowest of any other major economy bar one, and it's important that with those changing circumstances and being able to get through with unemployment so low that we keep a very strong focus on mutual obligation.
BENSON:
Do you think this change will weed out a significant number of people who are not doing their part of the mutual obligation process?
BOWEN:
I think, of course, the vast majority of job seekers are doing their part, but yes, this will be a more intensive focus which will better enable Centrelink to identify those who are not.
BENSON:
There are 200,000 people reportedly affected by this change. Do you have any estimate of how many may not qualify under these tighter restrictions?
BOWEN:
Well it's actually more than that Marius: about 350,000 people will be required to report to Centrelink more frequently. What proportion will have their payments more stringently dealt with is a matter that we'll have to see. It depends on how many people cooperate with the Centrelink process and how many people aren't doing their bit at the moment. We don't have any modelling to suggest what figure will come out, but we know that this will give us a better chance of identifying any job seeker who is not fulfilling their part of their mutual obligation.