BARRIE CASSIDY:
Treasurer, good morning, welcome. We know that the Prime Minister can't sack the leader of the National Party, but if this was a Liberal minister, would he or she survive?
TREASURER:
Well that's not what is before us. What is before us is a matter for the National Party, and I think one of the outcomes, particularly of yesterday, was an understanding that the Prime Minister and the Liberal Party are not in any way intervening in the affairs of the National Party, as you'd expect, and this is entirely a matter for the Deputy Prime Minister as the leader of the Nationals and the National Party.
CASSIDY:
But when you say they didn't interfere, the Prime Minister on Thursday left a very clear impression that he would like the National Party to at least consider Barnaby Joyce's position?
TREASURER:
I wouldn't agree with that and that's what the point of yesterday's discussion, amongst many things, was. There's an acceptance that the Prime Minister is not meddling in the affairs of the National Party.
CASSIDY:
I'm sorry; he said he has to consider his own position. He said that publicly.
TREASURER:
Well I'm talking about a discussion that was held yesterday Barrie, I spoke to the Prime Minister soon after that discussion…
CASSIDY:
On Thursday the Prime Minister said Barnaby Joyce has to consider his own position…
TREASURER:
That's a direct position to the Deputy Prime Minister. Not the National Party. I mean, that's a decision for Barnaby to make, as it would be a Liberal minister in those situations as well. So that's a matter for Barnaby, it's a matter for the National Party and it's a matter that I'm sure they'll be contemplating. But yesterday, the meeting, I think, did a couple of things. One was that it demonstrated that the two men can sit down and have a frank conversation about these things. Not the first time, they've talked about these things before. And there is no demurring from the substance of what the Prime Minister said on Thursday. There was obviously some sensitivity to the forcefulness of it, but frankly, I wasn't surprised by the forcefulness of it because I know the Prime Minister's strong views on this and his lived experience.
CASSIDY:
So you don't think it was unreasonable for Barnaby Joyce to complain that it was too forceful?
TREASURER:
I think he clearly raised that and it was very forceful and I can understand that Barnaby would be in a very sensitive frame of mind at the moment, that's why I think you just let those comments go through to the keeper. You sit down together, like they did yesterday, and then you move forward which is what's happening and focus on the important agenda that the Government has. The Deputy Prime Minister, Barnaby, is taking the week, as was announced last week. I think that's a positive thing to happen. The Prime Minister will get on with his business. He'll go to the United States later in the week. We'll get on with all of our business and that is about creating jobs for Australians, 1,100 a day.
CASSIDY:
Do you know whether the Prime Minister conceded that he'd been too forceful?
TREASURER:
I think there was an understanding of the sensitivity of the situation but no walking back from what he had to say. Two things happened at that press conference, Barry, that the Prime Minister gave. Give me the opportunity to explain. Firstly, the Prime Minister could not allow the Australian people to be in any doubt about what he believes are acceptable standards. The standard you walk past is the standard you accept. And it could not be left in any doubt that the Prime Minister was prepared to walk past that standard. The second point is this – the Prime Minister is making a point – not about affairs in general, but what is a professional standard in the work place. He made it clear, it doesn't matter whether you're single or whether you're married, you can't sleep with your staff. Now, that's a clear standard. I'm disappointed that it hasn't become bipartisan. If Bill Shorten became the Prime Minister, he would either have to accept the code, as it is currently, as he would inherit it, or change it. Clearly both he and Tanya Plibersek are saying they would get rid of it. So I can only assume from that, they don't think it's a problem, in a position of power and influence as a minister, it's OK to sleep with your staff. It's not in 2018. They should come up to date.
CASSIDY:
We'll get back to the code. Just again on yesterday's meeting, though, apart from having a chat, is there anything you can say that amounts to progress?
TREASURER:
Yeah there is. I think there was a clearing of the air about the events of the latter end of the week. There was a lot of sensitivity. They are both forceful individuals. They're both men of great passions about what's important for the country, and I think they demonstrated they could sit down, have a real conversation about what had happened in the days past and I think we can reassure Australians that despite the strength of those words, that the Coalition is strong and remains. The National Party will deal with their issues, the Government will keep on about its tasks, which as I said, growing jobs, growing the economy to lift wages, to support more investment. 1,100 jobs a day. The best jobs figures we've seen, again just this week. The longest run of employment growth in Australia's economic history. That's the results that the Turnbull-Joyce Government is getting.
CASSIDY:
So Barnaby Joyce stays as leader of the National Party, you're seriously saying it can be business as usual?
TREASURER:
It has to be. We're a professional government. You'd be aware with your long experience around politics, Barrie, that from time to time, people in senior positions have positions of disagreement. But they work together. We saw John Howard and Peter Costello work together exceptionally well.
CASSIDY:
Usually one of them falls over.
TREASURER:
Well, that didn't happen in the case of John Howard and Peter Costello. Clearly there were some differences, they're both professional men committed to the welfare of the Australian people and I can say that about both Barnaby Joyce and Malcolm Turnbull with a lot of confidence.
CASSIDY:
In your personal view, was the Prime Minister right to say that Barnaby Joyce's behaviour was shocking and that we were all appalled by it?
TREASURER:
Yes.
CASSIDY:
You do?
TREASURER:
I do.
CASSIDY:
And yet, for so long, the universal view seemed to be that you don't talk about affairs in that way, that they're personal matters?
TREASURER:
This is the difference; I think you're missing the point here. This is about having sex with one of your staff, whether you're a person of power and influence as a minister. It doesn't matter whether you're married or single. What the Prime Minister is saying, as is the case, I mean, we saw it in the AFL, we've seen it in corporate Australia, we've seen it in many different walks of life, that no good comes of it, is what the Prime Minister said. And it is not a good professional practice to have that in place. Now, I think that should be common-sense. But clearly, as a standard, it obviously now needs to be set out and I'm disappointed that Bill Shorten and Tanya Plibersek don't think it's a standard that they should sign up to.
CASSIDY:
They probably think it will be hard to administer, that the ban might not work.
TREASURER:
What's so hard to administer? You set out a standard that says, don't sleep with your staff. The point of having a code…
CASSIDY:
Then you have to police it.
TREASURER:
No, the point of a code is preventative. If you have a code you're telling people - you do this, understand by doing it, that you'll be gonski! Understand that. Understand it. It's a clear standard. Now, I'm happy to have a Prime Minister who's been prepared to call out a political culture in this country that has been going on for decades, if not generations. That took an enormous amount of courage, because look, of course we knew, Barrie. Everyone would say, you can't police it, or private is private. I'm sorry - if you sleep with your staff, it's not private any more, it's public, because you're a minister in a position of responsibility and power, over those who work for you. And we owe it to them to live up to this standard and have this standard in place and I think Bill Shorten should sign up before the end of the day, otherwise he is prepared to walk past this.
CASSIDY:
So you now have the moral police dictating what goes on between consenting adults?
TREASURER:
This is not the moral police. You're missing the point, Barrie. It doesn't matter if you're married or single. You shouldn't sleep with your staff. It's a bad practice. It's not conducive to the good running of your office and the performance of your duties. And that's the public interest point.
CASSIDY:
Ok I was just quoting your deputy leader Julie Bishop who said precisely that a week ago. But you've moved on.
TREASURER:
A week ago there was talk about legislation. There is a difference between legislation and a code from the Prime Minister. I am accountable to the Prime Minister, as the Treasurer, and he sets the standards, and he should, and he has, and he should be commended for it.
CASSIDY:
Ok onto portfolio matters. The Reserve Bank Governor Philip Lowe has warned governments not to borrow to fund tax cuts, now you've already made the point that most of your tax cuts do not come into effect until you actually will be in surplus. But some of them, some of them will be, and you'll need to borrow to pay for them.
TREASURER:
No, what Phil Lowe said, and this was clarified in his own statement, was that he was very pleased about the trajectory the Budget was on. Now the trajectory the Budget is on includes those tax cuts. So he was not making a comment about the tax cuts that are already in place because they are in the Budget, and he is very pleased that the Budget we currently have, the trajectory we've kept for five consecutive statements brings the Budget back to balance in 2021. So I think that is very clearly the statement of the Reserve Bank Governor. Now, what is important, though, is that we ensure that we continue to maintain that balance and to do that, you've got to do the things that continue to drive growth in your economy, the investment that is needed, and that's why this tax plan has always been so important. Now, I note there are comments made by the Opposition. "Oh, you've got to do it when it's affordable". They were proposing tax cuts when the budget was in a greater deficit than now, and the Shadow Treasurer commended the UK Government for actually going further on tax cuts when their fiscal position was even worse, and commended it for doing it when it was worse. So you can't have it both ways.
CASSIDY:
No but it does underscore that's it's absolutely imperative that you hit that surplus target. How do you do that? Do you do that by cutting expenditure or by raising taxes?
TREASURER:
It's already in the forward estimates Barrie, which has been confirmed five times running. So that 2021 projected balance has not shifted in five statements. That's been one of the key reasons why the triple A credit rating has been maintained over that period and that's why the Prime Minister and I have both said - anything we do on the tax front is not being done to prejudice or put at risk that 2021 projection. So we know that rule. We've been sticking to it and that's why we've been keeping the AAA credit rating.
CASSIDY:
Does it factor in something going wrong? Donald Trump's tax cuts for example. It's going to blow out the U.S. deficit big time. There are now concerns about inflationary pressures and in turn, global interest rates will rise. Now, that means paying back the debt is going to be more expensive for the Government.
TREASURER:
That's why it's important to keep the AAA credit rating as well Barrie. And that's why we are constantly looking at the impacts of these things on our forward estimates. There have been a lot of events in the last five statements too Barrie, and we've kept it on track. As a Government, we have kept this on track. And that is has been important. That's why we've continued to make the decisions to keep it on track and we can be trusted to keep doing that and that's exactly what we'll do.
CASSIDY:
You've praised Donald Trump's tax cuts, the company tax cuts. But it means a deficit over the next five years of 5 per cent GDP. Why would you do that? Why would you blow out the deficit at a time when the economy is strong and unemployment is low?
TREASURER:
I've praised the fact that they're bringing taxes down. What we've done, which is different to what's happening in the US, is we've done it within a Budget envelope which still sees the Budget coming back into balance at 2021. That's the key difference between what we're doing in Australia and what's happening in the United States. Now, I'll leave it to the U.S. administration to justify what they're doing on their Budget, but the idea that if you lower taxes, which it's not just the U.S., as you know, the UK is doing it, even Germany is now considering it. They're already doing it in France. So we are seeing corporate taxes come down and we must remain competitive because if we don't, jobs and investment go offshore, which is bad for people's wages, it's bad for people's jobs and it's bad for growth and the economy. So we need to keep up. That's clear. And we're doing it in a way that is fiscally responsible.
CASSIDY:
Treasurer, thanks for your time this morning.
TREASURER:
Thanks a lot Barrie, great to be with you.