PRESENTER:
Joe Hockey is the Treasurer, good morning.
TREASURER:
Good morning, Chris.
PRESENTER:
Joe Hockey, are you about to beat a Budget retreat?
TREASURER:
No, the story is wrong. The bottom line is: if you can win a battle, you take that victory, but you never give up on the war. In this case we are absolutely determined to stop the trajectory that Labor left of debt going to $667 billion in ten years – which is $25,000 for every man woman and child in Australia.
PRESENTER:
So listing some of the battles, can you win the $7 Medicare co-payment battle?
TREASURER:
Chris, we’ve always said that we will negotiate with sensible people. Now, if there is an inability to get a majority of the Senate, we are going to continue with the principles and we are going to continue with the policies because ultimately what we are doing is right for Australia. Now, you never give up, Chris, you never give up on doing what is right for the country.
PRESENTER:
But would you negotiate that down to zero?
TREASURER:
No, I’ll give you an example, Chris. People said that we were never going to get the Mining Tax repeal package through and we did. People said we’d never stop the boats and we have. People said we’d never repeal the Carbon Tax and we have and we are building the infrastructure of the 21st Century. So, we are getting on with the job of building a stronger economy.
PRESENTER:
But if something like this, the $7 Medicare co-payment, is not working, will not get through the Senate, why would you keep banging your head against that brick wall?
TREASURER:
Well, you never give up. You never give up, Chris, because ultimately this means that we can afford the quality of life we have in Australia and live within our means and we should never give up on that principle.
PRESENTER:
What about university deregulation?
TREASURER:
Again, if we want to have universities in the top 20 in the world, if we want to be able to compete with the best in the world, we need to have a deregulated university system that increases access for more Australian students and gives them the very best education in the world.
PRESENTER:
What about the indexation of excise on petrol? Are you going to even introduce legislation on that?
TREASURER:
This is a very important structural reform that helps to pay for our record investment in infrastructure and I think Australians understand that paying an extra 40c a week in fuel costs contributing to better roads, better quality infrastructure is going to help to deliver more jobs and greater prosperity.
PRESENTER:
So with all the things you mentioned in the Budget speech, will we expect then, that you’ll bring that legislation forward into the Senate now to have that fight.
TREASURER:
We are, absolutely, we are working through every single one. We don’t give up on good policy, we don’t give up on doing what is right to address the legacy that Labor left.
PRESENTER:
What about bad policy? What about making people under 30 wait six months for the dole? Even your own people believe that’s a breach of human rights.
TREASURER:
I don’t accept that’s bad policy, I think ultimately we need to have an earn or learn approach for young Australians. We are, through trade support loans, giving them more opportunity to go into apprenticeships than ever before. We are providing more opportunity to go to university than ever before. We want Australians to start their working lives, working, not on the dole.
PRESENTER:
So, will you need to find more savings in order to reach your Budget targets?
TREASURER:
Obviously, when we get to the Budget next year we look at the situation and then we lay down a plan that helps us to get back to surplus…
PRESENTER:
Why don’t you do it before that?
TREASURER:
…just let me finish, Chris. It is hugely important that we get back to surplus, because only when we get to surplus do we start paying down the debt that has been left by Labor. So, only by getting to surplus are we going to stop the trajectory to $667 billion of Labor debt.
PRESENTER:
Could we see a change of direction by the Government in the Mid-Year Economic Outlook? Might you start looking at new savings then?
TREASURER:
There have been a number of initiatives already announced which are very important, such as increased funding for security, we need to identify the savings that help to pay for those sorts of new initiatives.
PRESENTER:
Can you put a figure on what that will be?
TREASURER:
No, you’ll see it in the mid-year update which is in December, because we are, again, carefully and methodically going through the Budget. Chris, we don’t do what Labor did – make it up along the way.
PRESENTER:
You’re also facing a slowdown in revenue, so with those rising military costs that you talk about, does that mean that you will have trouble in reducing the Budget deficit from $48 billion to $30 billion as you planned?
TREASURER:
We are working to our plan, we don’t give up on our plan.
PRESENTER:
[inaudible]
TREASURER:
Well, just wait and see, but I just say to you, Chris, we are absolutely determined to help strengthen the Australian economy. The best way to do that is to strengthen the Budget and that means more jobs and greater prosperity. That’s one of the reasons why, Chris, we are running new job creation this year at six times the rate that it was last year under Labor. Nearly 30,000 new jobs a month on average this year compared to 5,000 new jobs a month last year under Labor.
PRESENTER:
A million as you promised?
TREASURER:
Well, we’re on track, but you know, I never give up.
PRESENTER:
Now, is the Government letting billions in tax dollars leak off-shore as companies evade tax?
TREASURER:
No, but we are doing everything we can in a concerted fashion to ensure that companies that earn profits in Australia pay tax in Australia. There has been a lot of reporting lately that is well intentioned but it has been inaccurate. The fundamental point is, unless we approach the taxation of businesses from a global perspective, which we are doing through the G20 then it simply means that companies can go and move their profits to other countries and we never see the tax that should be paid.
PRESENTER:
So, Google, Apple, Microsoft and Amazon; how are you going to get that money?
TREASURER:
Without naming specific companies, if a company has a product that they sell in Australia and a comparable product in another jurisdiction and there is a price differential, then clearly the starting point is that that is taxable income in Australia.
PRESENTER:
Is the US on board with this? I can understand that other countries are, but most of those countries are pretty well onside with the US administration.
TREASURER:
I think, in my discussions with Jack Lew, the Secretary of the US Treasury, in Cairns, and also I have no doubt next week again in Washington, there is a global resolve to ensure that companies pay their fair share of tax wherever they are based. Now, it is hugely important, Chris, to ensure that companies that operate out of an island for profit purposes are paying their proper tax. So if the major economies in the world can come to agreement, but if there is going to be an outlier nation that allows them to operate as a tax haven, then it simply means we can’t get them. So the global approach that Australia is leading under the Abbott Government, the global approach that we are leading is going to ensure that these companies pay their fair share of tax wherever they earn their profits.
PRESENTER:
Finally, the Senate has given the nod to an inquiry into the Queensland Government. Fair enough isn’t it, given that you ran two Royal Commissions which the Labor Party believe were aimed at them?
TREASURER:
Hang on, I mean, if anyone is saying that the Pink Batts Royal Commission was aimed at Labor that’s completely at odds with what Bill Shorten said yesterday in Parliament where he welcomed the findings, and that was an election commitment. In relation to systemic corruption in the union movement, I mean, if the Labor Party feels that they’re the target of that, well, frankly, it’s corruption in the union movement that they should be focussed on. Yesterday was just pure politics. I mean, it was rather an odd bedtime story for the Palmer United Party and the Greens and the Labor Party to get together to look at irregularities at a state based level given the damage that the Bligh Government did to Queensland.