COLVIN:
The Treasurer Peter Costello says the Labor package has been cobbled together 16 weeks late and 32 days before the election. He says Mr Latham's tax plan also contains some glaring errors. The Treasurer joins me now. You say it's 16 weeks late and only 32 days before the election, but the Pre-Election Financial Outlook still isn't going to come out until Friday, you can understand holding back, can't you?
TREASURER:
Oh, well this package will unravel. It is already unravelling today.
COLVIN:
How?
TREASURER:
Well, you see Mr Latham made the claim that nine out of ten people would be better off, and he produced some tables, but he left out of his tables the $600 Family Tax Benefit.
COLVIN:
And, are you absolutely certain about that? Are you sure he hasn't folded that $600 on an annual basis into his figures?
TREASURER:
Absolutely sure because when you go to the footnotes, and I don't know if you read it, but if you actually go …
COLVIN:
I haven't got down to the footnotes yet …
TREASURER:
No I do not know if he read it, because I do not think he understands his policy. If you go to the footnote on page two of the family tables, explains, it makes it clear that they just happened to leave out of the weekly tables, the $600 lump sum payment. Now, can I give you another …
COLVIN:
Before you go on to the next bit, we did hear Mr Latham there saying that the $600 was not real.
TREASURER:
And he says I can leave that $600 out because it is not real. Now 2.2 million Australians have just been paid $600. It is per child per annum. They were paid their first payment before the 30th of June. Hundreds of thousands are now going to be paid another payment starting in September, and Mr Latham said it is not real, and he left it out of his tables so that he could try and show people were better off under his package.
COLVIN:
Even without the $600, his tables, his annual tables make it look as though under Labor people would be, average families in the sort of middle income bracket would be $1,000, $2,000 even $3,000 better off. So you could take the $600 out, and he would say that they are still better off.
TREASURER:
Oh well, let me come to the next one that he has left out of his tables. There is a thing called the low income tax offset. He wants to abolish the low income tax offset and replace it with another credit which I think as he said, he says is $416. Again, he has left out the effect of the abolition of the low income tax offset from his weekly tables. So he has left out the $600 family payment. He has left out the abolition of the low income tax offset. Now this is not a policy to 'ease the squeeze'. This is policy to try and 'hoax the folks'. The folks are being subjected to the greatest hoax because he leaves these benefits out of his tables and he says look, look, once you ignore the benefits that I am abolishing, and once you ignore the benefits that the Government is paying you, you can be better off under my policy.
COLVIN:
Whom to believe though, because he says this has been looked at at the independent think tank, the Melbourne Institute?
TREASURER:
Well I will come to them in a moment. But just believe his footnote on page two. It is there, you can all read it. Now, let me come to the third area where he tries to 'hoax the folks'. We have a programme which is called the superannuation co-contribution, where low and middle income earners if you put $1.00 into superannuation the Government will match it with a $1.50. He is abolishing that.
COLVIN:
But he says that he is going to compensate for that.
TREASURER:
Well again you see he says, this is how he tries to 'hoax the folks'. Leave out the $600 payment, leave out the low income tax offset which I am abolishing, leave out my abolition of the superannuation co-contribution, and you will be better off.
COLVIN:
Matt Brown said that he was going to have a bit of a difficulty selling the idea that the $600 was not real. Are you going to have any difficulty selling the idea that you have to look at the footnotes, and you might find some problems with this?
TREASURER:
Well I just say look at the footnotes because I assume Mark Latham does not understand his own policy. Otherwise, well, he either does not understand his policy or he is engaged in deceit. Because the phrase he used was 'nine out of ten were better off on a weekly basis' and he uses tables which leave out your current entitlements.
COLVIN:
I am just wondering if there is anybody in the middle with a calculator who you would both be able to trust to go through all of this.
TREASURER:
Yes. We would trust the Treasury which under the Charter of Budget Honesty can cost this policy and I call on Mr Latham to give it to the Treasury under the Charter of Budget Honesty today. Today, let them cost it.
COLVIN:
And is that meaningful to do that now before the…
TREASURER:
Absolutely.
COLVIN:
…Pre Election Financial Outlook?
TREASURER:
He has announced the policy, it can be costed on the same basis that the tax changes in the Budget were costed.
COLVIN:
You are essentially accusing him of conjuring figures out of nowhere but just in the last 24-36 hours we have found that there is $1.8 billion that nobody really seemed to know about. Where did that come from?
TREASURER:
Well that was costed by the Treasury and that is in the figures that the Treasury will release. But look…
COLVIN:
I mean you still have this huge advantage don't you of having Treasury on your side?
TREASURER:
No. I am sorry, no, the Government is in a Caretaker Period…
COLVIN:
So how did you manage to get it costed by the Treasury?
TREASURER:
…and this was a decision that was taken before the Election was called.
COLVIN:
Why didn't we know about it before?
TREASURER:
This was a decision which was taken before the Election was called and is in the Budget bottom line.
COLVIN:
Is it surplus…
TREASURER:
You…
COLVIN:
…that has just appeared since the Budget?
TREASURER:
It is funny we are getting off Mr Latham's tax policy isn't it on the day that it was released.
COLVIN:
There's an election campaign going on. I am entitled to ask you about Mr Latham…
TREASURER:
Yes.
COLVIN:
…and about your own policies.
TREASURER:
And he has put out a policy today. And you said to me is there any one that can independently cost it. And the answer is yes. Under the Charter of Budget Honesty it can be independently costed today. Now he was asked by journalists would he give it to the Treasury for independent costing. And the long convoluted answer, the bottom line of which was no. But it can be given to the Treasury today. The public of Australia can have a look at it but I would say to the public on those three measures, one he takes out the $600 payment and he says well I will convince you $600 does not exist. Secondly he does not allow for the low income tax offset. Thirdly he abolishes your super co-contribution and then he says, oh but if you forget all of those things you will be better off.
COLVIN:
So we will see in the next twenty four hours or so whether he will do that. But in the meantime have you got any more billions here or there? Is there any more going to suddenly appear?
TREASURER:
During the course of the campaign we will announce properly costed policies which will be costed by the Treasury. Now…
COLVIN:
But…
TREASURER:
…the only thing I would say to Mr Latham is this…
COLVIN:
…is there anything else like the $1.8 billion that you have got up your sleeve that has already been costed?
TREASURER:
We will release properly costed policies and we will submit them to the Treasury for costing…
COLVIN:
So you…
TREASURER:
…I lay down this challenge to Mark Latham…
COLVIN:
But I am asking you…
TREASURER:
…to do the same thing.
COLVIN:
…is there anything that you have already submitted to Treasury…
TREASURER:
Of course we will announce…
COLVIN:
…like that $1.8 billion?
TREASURER:
Mark of course we will announce further policies during the campaign and of course they will be costed. And the challenge I lay down…
COLVIN:
But that is not an answer to the question I am asking…
TREASURER:
It is an absolute answer to the question.
COLVIN:
No I am asking if there is anything you have already asked Treasury to cost for you…
TREASURER:
Policies…
COLVIN:
…before the election campaign started like you say the $1.8 billion was costed?
TREASURER:
And here is the answer. Policies will be released by the Government which are costed by the Treasury.
COLVIN:
Have already been costed.
TREASURER:
And can be costed. No they will be resubmitted. They will be resubmitted.
COLVIN:
During the campaign?
TREASURER:
So that the Treasury, during the campaign, during the Caretaker Period, can authorise the costing. And I lay this challenge down to Mr Latham – do the same. Do the same. Just put your policies into the Treasury. Let them cost them. The Government is going to put all of its policies into the Treasury. Just do the same.
COLVIN:
Peter Costello thank you very much for joining us tonight.