BEN FORDHAM:
Treasurer, good afternoon.
TREASURER:
G’day, Ben.
FORDHAM:
Thank you for the tax cuts.
TREASURER:
I can’t say that the article in The Financial Review today was informed by the Government. So, that’s just more speculation from journalists before a Budget as you’d expect but we made no secret about the issue back last November. The Prime Minister and I both said that we believed it was very important to provide tax relief to middle income earning, low to middle income earning, Australians and that’s what we’ve been working hard on. I confirmed today in a speech that I gave at lunch that we would be delivering that target and the release of the details of that we would be setting out in the Budget.
FORDHAM:
Would we be right in guessing that you would be trying to be modest in your approach – in other words, small at first and phased in over a long period, maybe a decade or so?
TREASURER:
Anything we do is always part of a bigger plan, you’re right to say that we will do what’s affordable. We will do what doesn’t put the broader Budget at risk. People are not loosening their belts and neither is the Government. We need to keep the tension in that cord when it comes to expenditure restraint and tax restraint and that means, on tax restraint, that where the economy is improving more, our view is it’s your money and you should be able to keep as much of it as is possible.
FORDHAM:
Let me get to the Medicare levy, the latest Newspoll says after health care, the biggest issue people want fixed is the debt. Now, on the debt, the gross national debt – $525 billion, net debt – $340 billion. Can we afford to forego the $8.2 billion over four years that you would have collected from the Medicare levy rise?
TREASURER:
What we have seen is the improvement in the revenue and the reduction in the growth in payments that we’ve seen from the economy improving. That is putting us in a much better position. So we can stay exactly on the track that we’ve set out for bringing the Budget back to balance in 2020-21 and to be able to see the debt start to fall from 2019-20 onwards. Once you get into a position of surplus, that’s when you start paying down debt and we will remain absolutely on track to achieve that. But I don’t want to see the Budget put into surplus on the basis of higher taxes. The Labor Party, that’s what they’re going to do and they’re going to allow taxes to increase to at least more than a quarter of the size of the economy – which is higher than we’ve ever seen in the last 40 years. They have a tax stream that doesn’t end, too much tax is not enough for the Labor Party. So, that’s not our approach. Every time you hear Chris Bowen or Bill Shorten say “Budget repair”, what it means is higher taxes because they’re not controlling spending.
FORDHAM:
They’re also talking about repairing the Budget crisis they created in the first place.
TREASURER:
That’s right. You’ve said it yourself, Ben. I don’t need to reiterate.
FORDHAM:
The proposed Medicare levy hike was sold to fund the NDIS – the National Disability Insurance Scheme. Now, I’ve had a number of cases recently, Treasurer, where we’ve had to fight with Federal Government and State Government because people have fallen through the cracks in the changeover to the NDIS. So, there will be families out there who will be worried about the idea that the NDIS may not be fully funded.
TREASURER:
Every single dollar that is committed to that program will be absolutely committed to that program, there’ll be no change in that, that will be clear in the Budget and the reason we’re able to do this and provide this guarantee is because we’re focusing on creating a stronger economy. Because a stronger economy just doesn’t guarantee the National Disability Insurance Scheme, it guarantees everything. It guarantees Medicare, it guarantees the pension. There seems to be a view out there from some that you can just keep whacking up taxes over and over and over and it won’t slow the growth in the economy and put everything else at risk. We don’t hold that view. It is a very important program but there’s still a lot of work to do on the program, I know. I’m a local member in the Shire in the St George area and I know people have issues with how this is happening and we’ve just got to work harder on getting that right and the hand-off between the states and the Commonwealth. So, that’s what we need to focus our minds on. As Treasurer, I’ve said to them, “get on and do it. The funding is locked in for you at the very least for the next ten years and beyond. It’s built in permanently.” So, they need to focus on getting the scheme right, now, and the funding issue should no longer be under question. Now, we tried to do it a couple of different ways, Ben – as you’ll recall. We first sought to do it by making savings and they rejected that – the Labor Party – then we tried to do it through the Medicare levy and the Labor Party actually rejected that too. Now, just as well, we’re in a position to be able to do this now through a stronger economy and that’s because we’ve persisted in making sure that this program is fully funded.
FORDHAM:
Alright, we’ve spoken about income tax cuts, then there’s company tax cuts. You need two more votes in the Senate to get them through. Derryn Hinch says he’s prepared to support them but only for companies with turnover up to $500,000 and only if the banks are cut out of it. Are you willing to budge on that, Treasurer?
TREASURER:
Well, we’ll keep doing those negotiations directly with Senators, Ben.
FORDHAM:
Not here?
TREASURER:
Not there – strangely as you might find that to be the case…
FORDHAM:
But he is called ‘The Human Headline’, I think Derryn Hinch quite prefers to deal with things publicly.
TREASURER:
Well, we will deal with things directly with our Senate colleagues and work constructively with them. Senator Cormann, Mathias Cormann, as you know, has been very, very effective in doing that. We’ve got a lot through since the last election. In the Parliament that was supposed to get nothing done – we’ve got a lot done. We’ve passed over $30 billion worth of savings, we’ve been able to really make great headway in getting things through the Parliament, including getting unions and the rule of law applied to unions and building sites. Let’s not forget that. That was very significant. That was one of the key reasons we went to the last election.
FORDHAM:
Now, the other big question, you were at the ANZAC Day NRL clash yesterday.
TREASURER:
I was. My Sharkies weren’t playing though.
FORDHAM:
No, the Dragons beat the Roosters. Let me ask you, the Nene MacDonald try late in the game that went to the bunker, I’ve just spoken to Phil Gould, he says he wants the whole referee system blown up, including the bunker. Where does the Treasurer stand?
TREASURER:
I find the bunker thing very frustrating. It slows down the game and honestly, sometimes you’ve just got to blow the try. I remember when I used to play, you just had to play to the whistle and you dealt with what was going on. I think fans want to see the game move and people make the calls. Sometimes you’ll get them go your way, sometimes you’ll get them go the other. Sometimes it feels like you’ve got to refer the whole damn thing to the High Court when someone scores a try.
FORDHAM:
Where did you play? What position?
TREASURER:
Mate, I was a front rower – surprisingly enough – I’m sure you thought I was a dazzling fly-half [laughs].
FORDHAM:
I had a feeling you’d be in the scrum somewhere, Treasurer. Thank you very much.
TREASURER:
Head down, pushing hard, mate.
FORDHAM:
As you’re doing at the moment in the lead up to the Budget. We’ll speak between now and then. Thank you for your time.
TREASURER:
Good on you, mate. Bye.