BEN FORDHAM:
What does the Treasurer make of all this? He’s on the line. Treasurer, Joe Hockey, good afternoon.
TREASURER:
Good afternoon Ben.
BEN FORDHAM:
How are we?
TREASURER:
Great!
BEN FORDHAM:
You sound energised Treasurer?
TREASURER:
Well, you’ve given me a chance to get away from all the paperwork for just a few minutes and I really appreciate that actually [laughter].
BEN FORDHAM:
Is it all done? It’d all be settled wouldn’t it?
TREASURER:
Yeah, look it has been done for a few days now. Obviously we try and get the latest data on where the world economy is at, where the Australian economy is at, and that feeds into the bottom line numbers. Then you check, cross-check, double-check, triple-check. Then there’s a lot of documentation that goes out on Budget night and I’m also writing my speech, so there’s plenty to do.
BEN FORDHAM:
The job of Treasurer on Budget night, it’s not one that many people would want to sign up for, because you’re always going to upset people no matter what. But it seems based on what we’ve read today in some of the figures that have been leaked to the newspapers, that there are going to be a hell of a lot of pensioners who are going to be very happy with the result, and there will be some who are better off, some more wealthy retirees who are not going to be happy.
TREASURER:
Well, we’re working very hard to try and get the balance right and for Australians of pension age on lower income, they will be better off, there’s no doubt about that. For people that have in some cases, assets over $1 million in addition to the family home, they will lose some of the age pension, but the best thing we can do for them is have a stronger economy which means that the assets that are contributing to their income are worth more and ultimately, that’s good for the whole nation and very good for them.
BEN FORDHAM:
Well we should point out, because there’d be pensioners listening at the moment thinking how does this affect me? The detail will come out on Tuesday, but I think there’s about 4 million pensioners in Australia, we should point out, around 3.5 million of them won’t be affected by these changes, is that right?
TREASURER:
Well in fact it’s even better than that because we give a commitment to Australia’s pensioners that the pension will continue to rise twice a year and it will continue to rise by the highest indicator that has been available in the past. It will continue to rise at that level. Whether it be inflation or male total average weekly earnings, whatever’s the higher, the pension will increase by that amount. Now, that is good news for pensioners. Obviously, we are facing some budgetary challenges because we were left a mess, and we’re cleaning up that mess. We want to make sure that there’s predictability and certainty around the pension system and that’s why we’ve gone forward with this proposal.
BEN FORDHAM:
Alright so, to anyone listening who’s going okay these 172,000 pensioners who are going to be receiving more and they’re wondering is that me? So can you give us a bit of detail about who they are? Who falls into that category?
TREASURER:
Well essentially if you have assets beyond the family home of between $200,000 and $250,000 you’ll get the full pension instead of a part pension. You know, that’s more significant. That’s important. Obviously, the pension as I said will continue to rise twice a year. Now, in addition there’s a pensioner concession card and obviously state governments provide pensioner concessions on everything from public transport through to electricity and a range of other things. But it’s not just about the payments side Ben, we’ve got to get the cost of living down and we have done that. By getting rid of the Carbon Tax we’ve got electricity prices down and through, you know, a bit of good fortune petrol prices have come down. Interest rates have come down. Now I know that’s hard for a lot of superannuants, and that’s one of the reasons why we are absolutely determined not to follow the lead of the Labor Party and impose new taxes on superannuation, because the best thing we can do for people that are relying on assets for their income, is to create an economy where those assets increase in value and we’re very focused on growing the economy. Tuesday night will be about growing the Australian economy, creating more jobs, greater prosperity. It is an optimistic document, it’s a realistic document, but it is very focused on growing the Australian economy.
BEN FORDHAM:
Okay, it’s easier to give away sugar than medicine, let’s focus on the medicine for a moment. There’s over 235,000 pensioners that will have their pension cut, who are they?
TREASURER:
Well, they’re people on higher incomes who are part pensioners and what we’ve said is that we’re asking those people as Scott Morrison says in his very detailed press release, we are asking those people to look at using drawing down on up to 1.84 per cent of their additional assets. Now, that means you draw down on your superannuation to make sure you get the same level of income. Superannuation has these tax concessions because it’s meant to be used. People are expected to use their superannuation and the reason why the family home is excluded is because people want the stability and security of the family home. They may also want to leave their family home to their children. But the reason why we have a superannuation system with concessions is, and there are very significant taxation concessions, is that we want people to use that superannuation when they are in retirement or part-retirement.
BEN FORDHAM:
Okay, all of this won’t mean much unless you can get these changes through the Senate. We’ve now got a new Greens leader as of yesterday, are you hoping for a better reception from the Greens this time around? Or will it be more of the same?
TREASURER:
Well, a return phone call is a vast improvement on the relationship that we have with Senator Milne, so…
BEN FORDHAM:
What? Christine never called Joe back?
TREASURER:
Well, she was just, after we did an original agreement on the debt limit, there was a steadfast determination not to engage at all with the [inaudible]…
BEN FORDHAM:
Oh come on, it wouldn’t be the first time that a girl has avoided your calls? [laughter]
TREASURER:
Let’s not go there. But at least, well at least my wife returns my calls these days…
BEN FORDHAM:
Sometimes.
TREASURER:
Yeah, not always, but at least it’s a vast improvement on previous relationships.
BEN FORDHAM:
So, Richard Di Natale the new Greens leader is open to these changes? A step in the right direction they’re saying apparently on the pension overhaul?
TREASURER:
Well that’s encouraging. Look, you know, I do wish him well, I really do wish him well. Because he’s got an opportunity to pick-up the centre left, the middle ground of the left, which has been vacated by Bill Shorten. That’s because Bill Shorten just will not engage on any of these things, he has been reckless and has taken a reckless approach to our attempts to try and fix the mess that he helped to create. Now, if the Greens are prepared to be reasonable I think that would be warmly welcomed by not just the Coalition, I think it would be welcomed by the country. That you actually have some bipartisan agreement to fix some of the mess that was left behind but most importantly, to meet head-on the challenges.
BEN FORDHAM:
Alright, well look you’ve got a big few days ahead of you, you were accused last time around of trying too hard, of biting off more than you could chew. Sometimes I’d say that’s an admirable fault sometimes, when people go overs in their efforts to try and tackle this debt and we forget sometimes the amount of money. We need to remind people the amount of money that we’re borrowing here, $100 million or something a week just to pay off the interest…
TREASURER:
A day, yeah.
BEN FORDHAM:
A day. It’s an extraordinary amount of money and that’s, that highlights how ridiculous it is when all of a sudden you think hang on is that 100, it can’t be $100 million dollars a day. It is, it’s $100 million a day, we’ve got to do something about it and your Budget next week will hopefully go a long way towards that, we wish you all the best of luck with it.
TREASURER:
Well, I appreciate it Ben and thanks for speaking with me.
BEN FORDHAM:
No worries, talk to you soon, Treasurer Joe Hockey joining us live on 2GB.