SABRA LANE:
Joining us now is the Treasurer, Josh Frydenberg. Good morning and welcome to the program.
JOSH FRYDENBERG:
Nice to be with you, Sabra.
SABRA LANE:
We will get to that in a moment, but first let's talk about the Victorian result. You and the Prime Minister are meeting with a group of Victorian MPs this morning, what will you be telling them?
JOSH FRYDENBERG:
We will be listening. We were clearly out-campaigned in the Victorian election on the ground, but also in the advertising campaign. Labor ran a pretty ruthless and effective scare campaign on alleged Coalition cuts to health and education, which is just false because we have been increasing funding in both of those areas. And Daniel Andrews threw money at every problem that he faced, from congestion on the roads, to more money on transport, from problems with law and order to more money on police. And we need to counter some of the lies we see from the Labor Party.
SABRA LANE:
That might be your view, but a lot of the banners around Melbourne, I saw them on the weekend, they had Matthew Guy's face, but Scott Morrison, Tony Abbott, Peter Dutton. And they were really campaigning on the fact that your brand is toxic down there.
JOSH FRYDENBERG:
Well, firstly, this was a state election fought on state issues and that is what Matthew Guy has said. When it comes to the Coalition in Victoria, we have lost five out of the last six state elections, but at the same time we have won four out of the last six federal elections. And no first term majority Government in Victoria has been denied a second term in a hundred years and you want to bear that in mind, because this result is not too dissimilar to what Steve Bracks achieved in 2002 when he got re-elected and the Coalition lost 19 seats.
SABRA LANE:
What does it mean to be Liberal now, though? I mean your Victorian colleague, Jane Hume, has written a column today saying that the party needs to shape up or ship out and that if you allow good policy to be infiltrated, or even the perception of an ideological crusade here, Labor will win the messaging war. Is she right or wrong?
JOSH FRYDENBERG:
Well, the Liberal Party is at its best when it's a broad church representing those who have small l liberal views, as well as those who have conservative views. Now, when Sir Robert Menzies established the Liberal Party, he made it very clear we were a progressive party, not a reactionary party. We believed in the individual and his enterprise and his or her rights. We also rejected the social panacea, they were Menzies words. They still guide us today, as they did back then.
SABRA LANE:
But, the right rump within the party seems to be steering the party into a different direction and voters are having their say on that. They had their say at Longman, Wentworth, Victorian election. How are you going to deal with that? You look at your climate change policy, for example, you know more than most. A few MPs on the right hijacked that policy, they trashed it and they trashed Malcolm Turnbull.
JOSH FRYDENBERG:
Well, you refer to recent elections and I could also point out to you that in March, a Liberal Government defeated a Labor government in South Australia after 16 years of Labor. We recently won a second term in the Tasmanian state election and we have won four of the last six federal elections. So, don't write us off just yet.
Now when it comes to energy, what we have to do is explain to the public not only are we reducing power prices, but we are also reducing emissions. And emissions are at its lowest level in 28 years…
SABRA LANE:
Sure, but the…
JOSH FRYDENBERG:
On a GDP and per capita basis…
SABRA LANE:
…the example was though that you had a small number of Coalition MPs, you got that policy through the Coalition Party Room and they were able to completely trash it.
JOSH FRYDENBERG:
Well, when you're talking about the NEG and I've said it publicly before, and I mean, I obviously personally was the most disappointed that it didn't go through. But that being said, Labor has just put out their energy policy with recklessly high targets that will drive people's power bills up…
SABRA LANE:
Alright, but you're going to Labor again, not your own party. Should Michael Kroger resign as Jeff Kennett said?
JOSH FRYDENBERG:
Well, firstly, Sabra, let me just say that politics is a battle of ideas and we need to put our ideas forward but we also need to explain the faults and the fallacies put forward by Labor.
SABRA LANE:
Should Michael Kroger resign?
JOSH FRYDENBERG:
No, Michael Kroger has been a long term servant of the party and he has announced he is not recontesting the presidency in March.
SABRA LANE:
Liew O'Brian is threatening to cross the floor to support a National Integrity Commission; you're now down a number given the Wentworth result. Are you in danger now being embarrassed on the floor in parliament?
JOSH FRYDENBERG:
Well, we already have a multiple agency approach to integrity across the public sector. We have a public sector commissioner, we have inspector generals of taxation, defence, security and we are always looking at ways how to strengthen the regime.
But, Bill Shorten is engaged here in a political stunt. Eleven months ago...
SABRA LANE:
You might be but you are in danger of losing it with Liew O'Brien crossing the floor …
JOSH FRYDENBERG:
But Sabra, eleven months ago he said he would work on the details of such a policy, we haven't seen it. And now he is engaged in public policy by press release.
SABRA LANE:
And Liew O'Brien?
JOSH FRYDENBERG:
Well, we will continue to talk to anyone who has ideas about how we can strengthen the integrity system across the parliament.
SABRA LANE:
To the franking credit story. The ALP has put out a pensioner guarantee on this particular policy, promising 300,000 low income pensioners will be protected and that Australians don't want the best tax loop holes in the world, they want better hospitals and schools and maybe voters will actually prefer their policy.
JOSH FRYDENBERG:
Well, Labor has a $200 billion tax grab across the property sector, across retiree savings, across income tax, business and obviously higher electricity prices.
Now, when it comes to franking credits, Simon Crean, as head of the Labor Party then, supported the Coalition by saying, it actually supports, this policy would actually support low income investors. Because about 87 percent of those people who get the benefit of these franking credits have a taxable income under $37,000. And 900,000 individuals, including hundreds of thousands in Labor held seats will lose on average $2,200. And what the Labor Party is doing is penalising those people, Sabra, who prepare for their own future. And it is that level of personal responsibility that the Liberal Party stands for, that the Labor Party clearly doesn't it.
SABRA LANE:
And the opposition says, all you're out to do is to scare people and the Victorian election result shows on the weekend that voters don't appreciate scare campaigns.
JOSH FRYDENBERG:
So, this is from the party of Mediscare that sent millions of text messages to vulnerable Australians purporting to be from the Government, that we would sell Medicare. I mean, get real, the Labor Party are, you know, a party that are promoting these scare campaigns. Whether it is at a state level or a federal level, the pot shouldn't call the kettle black.
SABRA LANE:
There is an update on Labor's negative gearing policy this morning. The architect of the idea says that Labor should stick with the policy, even though property prices have gone down because the ratio between home prices and average income has grown and the policy is needed more than ever.
JOSH FRYDENBERG:
Economists from across the board have canned Labor's policy, because it would ensure that anyone who owns their own home will see it worth less under Labor and anyone who rents their own home will end up paying more under Labor. When Labor came up with this policy housing prices were rising, now housing prices have fallen and the Master Builders Association have pointed out that 32,000 people will lose their jobs as a result of Labor's policy and there will be 42,000 fewer homes being built. Labor's policy will cost jobs, it will hurt the economy, it will endanger our triple AAA credit rating and it is definitely the wrong policy at the wrong time.
SABRA LANE:
Treasurer, thank you for joining AM this morning.
JOSH FRYDENBERG:
Good to be with you.