CHRIS UHLMANN:
Joe Hockey joins me now. Welcome to AM.
TREASURER:
Good morning Chris.
CHRIS UHLMANN:
Joe Hockey, the young, the old, the states, the left, the right, the rich and poor have all united against this Budget are you on the wrong track?
TREASURER:
No, you have to do what is right for the country and you just can't keep handing out money at first on the back of a mining boom and then after that on borrowed money as Labor did and we have to start living within our means as a nation. Now, there is obviously going to be concern and there is obviously going to be protests, but the fact is we are not doing this for political favour, but we are doing this because it is right for the nation, we have to do it now.
CHRIS UHLMANN:
Have you failed to properly make the case for change?
TREASURER:
No, I don't think so. In fact I think before the Budget there was a general expectation that we had to make the difficult decisions. What has surprised me is that the Opposition has offered absolutely no alternative; they have become the national complaints desk and Bill Shorten is now blocking $40 billion of savings including, ironically, $5 billion that he promised before the election to pay for things like Gonski. He is now blocking his own savings, he is preventing us from implementing the savings we took to the last election, he is now opposing further savings which means that the pain further down the track for us is going to be greater for Australians if we don't move now.
CHRIS UHLMANN:
Why would it surprise you that the Labor is opposing some of your objectives given you made an art form of that when you were in opposition?
TREASURER:
Well, that is not right. The fact is that we allowed the Labor Party to make savings in various areas. We allowed the passage…
CHRIS UHLMANN:
And you opposed a great many of them as well.
TREASURER:
And we actually by far – by far, facilitated the passage of those savings through because we knew the Budget needed to be repaired. For example, we facilitated the passage of changes to private health insurance, changes in relation to single parents on a pension when Labor moved over 60,000 people from the Parental Pension on to Newstart. Bill Shorten personally asked me to help him with that and we did and there were numerous other savings. But the fact is, now, today, they have an opportunity to respond and Chris Bowen, who is appearing at the National Press Club; I expect that he will provide an alternative not just a complaint, but an alternative to fix up the mess that Labor created.
CHRIS UHLMANN:
But you didn't provide an alternative in Opposition. In fact, that is why this agenda that you have released now is such a surprise. In fact, you are doing things now that you said you wouldn't do. So why should Bill Shorten take your advice?
TREASURER:
Well Chris, that is actually not right. In the Budget in Reply Speech last year, Tony Abbott detailed over $5 billion a year of savings including…
CHRIS UHLMANN:
Nothing on tax….
TREASURER:
Including abolishing the Schoolkids Bonus and he also said upfront before the election that we would have to have a levy on, to pay for the Paid Parental Leave scheme, which is going to apply to the largest businesses. So the fact is, we actually did have the courage to announce savings before the election. Labor, in fact, also announced $5 billion of savings before the election. But after the election, they are not only opposing our savings which we promised because the Budget has to get back into surplus, they are also opposing their own savings which they promised before the election.
CHRIS UHLMANN:
One of the things that you clearly hoped for when you came into Government, that there might have been a restoration of confidence, in government, and that would have an effect on consumer confidence. We now see that consumer confidence has fallen since your Budget, at the fastest rate since the GFC. That is hardly a good outcome is it?
TREASURER:
Well, the fact is, we have to make the difficult decisions in the national interest to strengthen the economy and as Standard & Poor's indicated yesterday, you need to have a medium and long term plan to get the Budget back to surplus; a credible plan to get the Budget back to surplus to maintain Australia's AAA status. Now that's not an accident that we had AAA. Labor lost it last time. It was the Liberals and the Nationals that got it back. Labor managed somehow to keep it but the risks are there that sooner or later we are going to pay a price for the massive increase in expenditure (inaudible).
CHRIS UHLMANN:
But Standard & Poor's analyst Craig Michaels says, that the story yesterday in The Financial Review was not correct in fact their current forecasts, they're quite comfortable with that you will be broadly back in balance over the next four or five years.
TREASURER:
Well, that's wrong because he actually did raise concerns about the longer term challenges for the Australian Budget and he also said it's important to put in place medium and long time solutions to the increase in expenditure and that those sorts of things, if the Budget over the medium and long term is not addressed, then there will be risks. Now the fundamental point is, and we have said it before, over the next two to three years, we are focused on stimulating economic growth, that's why we are spending over $50 billion on new productive infrastructure – a record amount of money, and we are doing that at the same time as we are trying to reduce overall government expenditure.
CHRIS UHLMANN:
Well, there are so many things to talk about on the Budget but can you tell us, one of the key themes is that young people should be ‘earning or learning'. Can you point to any measure that will help the chronically unemployed find a job?
TREASURER:
Well absolutely. I mean the starting point is you have got to be trained and we are giving young people the opportunity to undertake a trade or a diploma course for example, and for the first time, the government is going to provide them with concessional loans to get them through. They don't have to start to repay the money until they start earning more than $50,000 a year. We also of course, will provide a wage subsidy to employers if they pick up some of the younger people who have been unemployed for an extended period of time. So they are two areas where you can see it. But overall Chris, our job is to build an overall stronger economy and only by employers having confidence that tomorrow will be better than today, will they go out and offer jobs to young people.
CHRIS UHLMANN:
Very briefly, finally, there is no consumer confidence that what you are doing is in the national interest, otherwise those figures would be rising not falling.
TREASURER:
Well, I don't accept the premise of that question because the fact is, since we came to government there was a surge in consumer confidence but people also now know that we have got to fix the Budget and it is now time for Bill Shorten to step up to the plate, not become a national complaints desk and actually offer some constructive alternatives. If he doesn't agree with what we are doing, now is the time for Labor to step up and say what they would do to get the Budget back to surplus.
CHRIS UHLMANN:
Joe Hockey, we will have to leave it there, thank you.
TREASURER:
Thanks very much Chris.