RAY HADLEY:
Superannuation – you knew it was coming.
TREASURER:
You’re very predictable.
HADLEY:
I love being predictable. I love it.
TREASURER:
We got it sorted, Ray. We got it sorted.
HADLEY:
Why didn’t you do what you did the last week before the election? You may have had an eight seat majority, 10 seats. You may have even controlled the Senate.
TREASURER:
No, I don’t think so. Ray, what we have done here, it isn’t just simply not proceeding with one measure. Everyone was very aware of the controversial nature of that measure but you don’t just go and reverse things without paying for it. What we have done, we have worked methodically over a period of time to ensure that what we have now come up with keeps the Budget intact and also deals with the concerns that were raised and we now have a system which is even fairer, even more sustainable and even more flexible. I think that is a good outcome all round. I think that it shows that the Government is prepared to work through these issues but most importantly to arrest the debt you just don’t go and throw away $550 million in revenue. You work on a solution that means that you protect the Budget and you make the system even better. That’s what we have achieved.
HADLEY:
But you took a long time to get there.
TREASURER:
Government is hard Ray and you don’t make decisions on the run. You work them through, that’s what we did and we came up with a better outcome and you look like you are thrilled about the outcome.
HADLEY:
Well, I am but what I can’t be thrilled about is, Alan Jones petitioned the Prime Minister. I petitioned you. We wanted you to go to a certain length. You said no, we can’t do it because it will cost too much money. You went even further. I mean you are a really good bloke now.
TREASURER:
There you go.
RAY HADLEY:
Yes, but it took you a really long time to be a really good bloke.
TREASURER:
You work the problem, you get an answer. You know that is how I work and we have got other issues we are working through now and we will work them through too.
HADLEY:
[inaudible] the election. You were an immovable object on this. You wouldn’t move. Who sat you down and said, ‘Scott, Alan and Ray are right. You have got to make some changes.’ Who sat you down?
TREASURER:
Well, Ray, you will be very disappointed to know that neither you nor Alan came up in the conversation.
HADLEY:
I just put us in there.
TREASURER:
There you go. Well, there is a surprise.
HADLEY:
Now, before we get down to the serious stuff. Last week on the program:
TREASURER:
I was on booths down in Sutherland Shire on the weekend. Under the circumstances we did pretty well in the Sutherland Shire.
HADLEY:
Pretty well? This is the best result, and this is not your problem but you are in the Sutherland Shire as a federal member, this is the best result in the Sutherland Shire for the Labor Party since 1991 thanks to your colleague Mike Baird and your other colleague Troy Grant. This is the best result. So, I take issue with you saying that ‘we did pretty well’ you have done disastrously and you know what it is going to impact on you down the track.
TREASURER:
Well, I disagree with that analysis on the result in Sutherland. It is 7 – 7 – 1, seven Labor, Seven Liberal and one independent. Now, previously Labor has actually controlled the council with the support of other independents. Now, that is not likely to be necessarily the outcome there. The point you are making Ray I don’t disagree with. Yes, that issue did come up on the booths on the day. I think I said that last time we spoke. So, yes it was there and I am looking forward to the Council working constructively together. I have never really thought councils should be about partisan politics. It is about rates, rubbish and roads and that is what these guys need to get on with and I look forward to working with all of those councillors whether they are Liberal, Labor or independent.
HADLEY:
But you haven’t changed your mind about the greyhound ban, have you?
TREASURER:
I have been careful about what I have said about it…
HADLEY:
I know you can’t do anything about it but you like Barnaby Joyce think it is a boneheaded decision.
TREASURER:
People are struggling to understand it but it is a matter for the state government. We have got our issues to deal with. Mike has got his and I will let him continue to deal with the things that he has got to deal with.
HADLEY:
Now, I listened to Ross Greenwood talk this morning and last night about this stuff up of the stock exchange. We will find out whether it is back on target in about 29 and a half minutes.
TREASURER:
I am advised it will be.
HADLEY:
Yeah, they said that yesterday. Let me say, I am the last one to be critical of anyone over technical issues because we have some technical issues here from time to time.
TREASURER:
All agencies have technical issues. The Government has them as well.
HADLEY:
Mine doesn’t involve $4.5 billion worth of trade on any given day.
TREASURER:
It was a very serious issue yesterday and ASIC will be investigating. They are responsible for securities and they will be doing that review and they will be reporting back to me on these issues. This was a very unfortunate incident yesterday but it has been five years, I understand, since something like that has happened to the ASX. Our ASX does have a very good reputation and the trade system, I understand, was not affected on national trading. Regardless of that these things need to be avoided and we need to determine what caused it. I understand it was a hardware issue but that is for the ASX to report.
HADLEY:
That’s what the pointy heads say all the time.
TREASURER:
Well, that is what it is.
HADLEY:
They always say to people who don’t quite understand it, like me and perhaps you, ‘it’s a hardware issue’. Or in one prophetic moment here when we couldn’t get to air with commercials or open line calls it was ‘a modem’. That’s always a good one, ‘the modem packed it in’
TREASURER:
Well, that is a hardware issue too. Look, they need to get to the bottom of that and obviously they will be working with their stakeholders at the ASX. They are a very sharp outfit and they have got a good international reputation and they will be addressing this in the appropriate way.
HADLEY:
Just tell me this, will you nervously look in about 28 minutes at your phone to see that it’s working?
TREASURER:
I imagine there are a lot more traders and others who will be nervously looking…
HADLEY:
But you are the Treasurer.
TREASURER:
Sure, and we will be but I am advised that things are ready to go but we will see.
HADLEY:
Ok, I wanted to get a fuller explanation about this clamp down on illegal foreign property purchasers and you announced yesterday 16 properties to be divested and they range in price from a couple of hundred thousand to a couple of million.
TREASURER:
Correct.
HADLEY:
People said to me, you buy a house, here is the vendor, he wants the agent to get the best price he can. It is a funny thing, everyone says I am not selling to Chinese until the Chinese offer about $500,000 more than the bloke next door and they say yes we will sell it. Involved in this, apart from real estate agents, are lawyers or conveyancers. If there are people purchasing property when they are not legally entitled to shouldn’t someone come back to the lawyers and say you know that contract shouldn’t there be a requirement for lawyers who are doing conveyancing to say I am sorry we can’t sell it to you because it is not legal?
TREASURER:
I think these are really good points and there are other issues around proof of residency and issues like that which have been raised with me in recent times and I am having a close look at that as well. What we are finding Ray, we have had some $92 million worth of divestments we have now forced by transferring the compliance, the police work on this to the ATO. They have done a very good job. What we said yesterday is further proof that we have foreign investment rules in this country but more importantly we are enforcing them and some $92 million worth of properties have been affected, $14 million with the announcement we made yesterday and it is not just at the high end. It is on properties which are worth $200,000. So, it is not just at the high end. We are policing these rules right across the mix. So, that creates the tension in the cord which I think can protect homebuyers in our property markets. It is important that we do that. Penalties apply also to purchases that predate 2015 but putting that to one side we are getting on with the job of implementing the laws. Sorry, penalties apply after December 2015. Otherwise it would be retrospective.
HADLEY:
Yes, we can’t apply the penalties before 2015. But isn’t it the case of shutting the gate after the horse has bolted? What I am trying to get at is what about just a simple thing in a real estate contract where you say, is this person entitled to legally purchase this property?
TREASURER:
Look, I think that is a very good suggestion. Remember, the purchases take place under state conveyancing laws, not federal. So, it means that the states and the federal government working together and there is nothing wrong with us doing that. I think it is a really good suggestion. It has been made to me already and so we are taking a close look at how we can achieve that.
HADLEY:
Well. Let’s hope that it works to that advantage. At the end of the day, if a real estate agent is being offered $2.2 million for a property that someone else is offering $1.8 million and that is from a bloke who is a resident as opposed to a bloke that is from Canada or Malaysia or anywhere else, he is always going to take the $2.2 if there is not a legal requirement for him to say ‘no I can’t sell it to you.’
TREASURER:
Well, if he or she is acting completely unethically which they shouldn’t do. They are aware of the laws like everyone else but it is a shame that we have to go to the extent that you are suggesting.
HADLEY:
They are not going to say by the way you look Malaysian are you Australian or Malaysian are they? And if there is no requirement on the contract for them to declare they are Australian citizens I am not going to blame them…
TREASURER:
It’s a fair point.
HADLEY:
Or the lawyers but I think something has to be done. Now, the Ausgrid sale was blocked. And you explained what happened in Darwin to us, the Darwin Port sale but that was done by the Northern Territory Government and at that time you couldn’t intervene as a Federal Government but now the Chinese have got a 20 per cent stake in the $9.7 billion sale of the Port of Melbourne. Now, I note also that there are Canadians involved in that as well.
TREASURER:
And the Future Fund and they are a big stake holder. Australians are involved in this.
HADLEY:
So, at the end of the day I guess you are comfortable that they do not have a controlling interest.
TREASURER:
They do not have a controlling interest. A port is different to a power network as well. One of the most crucial issues in the Port of Melbourne is who controls the harbour masters role and that is actually controlled by the Victorian State Government and that was a critical factor in this decision. Secondly, those proportions of ownership of the Port of Melbourne cannot be altered under the conditions I have put on this sale without it coming back to me. They are the terms that on which it was sold. They are the terms on which they can continue and that is the only basis on which foreign investment approval has been provided. Now, if they sought to change all of that they would have to come back.
HADLEY:
I want to get you involved in a story that has nothing to do with your portfolio. It is one that worries me and I know that it would worry you. Sydney girls as young as nine being exported overseas for forced marriages and part of the child bride epidemic. This is for all intents and purposes a state issue but we can go back to what you suggested a little bit earlier, some things cut across state and federal boundaries. In your former role it must be a very difficult job if Border Force protection officers have a suspicion that a child is being transported to another part of the world for this type of behaviour. I guess there is not much they can do without evidence of that before the child leaves the country.
TREASURER:
That’s right. This issue sickens me and I know it sickens you and I am sure it sickens your listeners. The Border Force can prevent someone from leaving the country where they have a hard reference from a child protection agencies or state police and what would happen in those circumstances is they would be prevented from leaving the country. Those accompanying would be referred to police as should be the case. So, the message really here is if this is going on and you are aware of it, tell the police, tell child protection agencies. Let people know what is happening in this situation because you can’t rely on Border Force to take an action on something they don’t know anything about. They can’t do it on a basis of a hunch. They have to do it on the basis of a clear referral. So, my plea is to people who are aware that young girls are going to be sent overseas I mean I have two daughters Ray, you have got daughters, it just beggars belief. So, if you know something about it pick up the phone and tell someone who can do something about it.
HADLEY:
So, if the police in any jurisdiction know about it and child protection know about it…
TREASURER:
Yes and they do some investigation and satisfy themselves that there is a legitimate issue here they can advise the Border Force and the Border Force can take action.
HADLEY:
From what I have read by a glimpse or by a story in most cases that has happened here where the child has complained to a principal, a teacher or a councillor and they have actually done something about it. Obviously, there would be small children as young as nine being transported to Afghanistan, Pakistan and other places and Indonesia for these terrible…
TREASURER:
It happens and it makes us sick.
HADLEY:
…arranged marriages. Now, just finally back to superannuation, where we started, George Christensen, did he have a big impact or bigger impact than anyone else on the change of heart?
TREASURER:
No, no he didn’t. I spoke to large numbers of colleagues and we spoke to people in the industry and no Ray actually if anything those sorts of things don’t help matters rather than helping matters. We just get on with the job of working those issues…
HADLEY:
What do you mean they don’t help?
TREASURER:
What I mean is, the way you resolve these issues is with your colleagues, you work through a good process, you come to a good outcome. The external commentary really doesn’t play into this…
HADLEY:
But George in the end appears to have won. Even if you don’t like the way he won.
TREASURER:
He was one of many people who raised this issue Ray. If the Government has been accused of listening, taking action and getting a better outcome, well we plead guilty.
HADLEY:
Ok, finally, the backpacker tax. Is it off the agenda, reading all sorts of publications today it is going to be tweaked, changed, or gone all together?
TREASURER:
As you know, before the election we said we would push back the implementation date subject to review, we are doing that. I have called that back into my office as Treasurer and I will be working that issue up and going forward in the next month or so, what Barnaby said yesterday, what I am also saying. It is another issue that we need to resolve. I am very aware of what the impact is on the ground. As you know, this came up in one of Joe’s Budgets and I was part of the ERC which made that decision at the time, as was Tony Abbott and others, and there was a reason to do it. Just so people understand the issue, when Labor increased the tax free threshold to $18,200 backpackers from that point on basically weren’t paying in tax on any of the income because they were earning less than that. So they basically were coming over, not for a working holiday visa, but a tax free holiday. So there was a change in the law, a proposed change in the law to try and fix that up. Now, it’s gone beyond and there’s some unintended consequences. We’ll fix that up, just like we have worked through other issues. The other point this raised for us Ray, and I know Christian Porter is talking about this today, it’s something you and I have talked about many times on the social services side of things. The reason we need to get backpackers into these jobs in these places is because there are unemployed Australian living in these areas who won’t take these jobs. Now this is a real problem with the welfare system. Now today, Christian Porter is releasing the data from this Investment Approach. This is something that was initiated back when I was Social Services Minister. Picking up that New Zealand experience. In the Budget this year we included the Try, Test and Learn program. What this is all about is it’s looking at the welfare system and saying who are those people who over the course of their life, are more likely to spend most of it on welfare and how can we intervene early to try and stop that. Christian has my, the Prime Minister obviously, the Government’s full support in what he’s doing here. It goes back to some work we were doing several years ago. That’s how you reform the welfare system. The best form of welfare is a job. This is about ensuring people can get out of welfare and into a job, and that way you don’t have big welfare bills in the future.
HADLEY:
The story today says, it’s been calculated at a staggering $4.8 trillion over the country’s lifetime. It’s all well and good to say the best welfare is a job, you would have noted with some interest the story that the Telegraph ran last week about a 17 year old and a 21 year old, who just said it’s their ambition never to have work. I don’t know anything about their families, I don’t want to reflect on their mother and father who may or may not have a job. But what that did, that cast a pall over the entire Western part of Sydney, because they come from Mount Druitt. Everyone said ‘oh lazy bastards they won’t work’. And yes they are lazy bastards who won’t work, but the majority of people in that area do their best to survive and work and be productive.
TREASURER:
True.
HADLEY:
The first thing that should have happened once that story was published and then the next day they published another story, the Tele, where McDonalds where they spend a lot of time apparently, said to come and work here. And they said no. Well, what should have happened, Mr Porter should have been ringing Centrelink at Mr Druitt and saying – here are the two girls, they’ve identified themselves. Get them off the dole. Whatever they’re on, stop it tomorrow.
TREASURER:
We have a Bill right now in the Parliament which says that you have to wait four weeks before you can go onto the dole, on what’s called Youth Allowance other, before you can access it. You’ve got to wait four weeks. Now there is some exemptions for that for people who can’t go home because of domestic violence issues or there’s a whole range of exemptions that protect very vulnerable people. But for those who are ready and able to work, we’re saying that there should be a mandatory waiting time before you can go on the dole. The Labor Party opposes it, the Greens oppose it. We were trying to get this through in the last Parliament, and these are the types of reforms that are necessary. Now I’m talking to Pauline about this, she is very supportive of it. As are some other crossbench Senators, and I think these are the changes we need to make. People accuse us and say oh you’re not doing enough to crack down on welfare. Well, you can see what Christian is saying today, we have proposed laws in the Parliament which will do that. We need the Labor party to stop protecting people who should be working and can work and what we found in New Zealand is when these waiting periods were put in time, people went and got jobs. And you know, we’ve got people in rural areas who aren’t going and taking these jobs on these farms, and so we’re going to have to employ foreigners to do that work, and change potentially the taxation arrangements for backpackers to give them the incentive to take on those jobs because Australians living in these areas won’t.
HADLEY:
Look, I understand that. I understand they are being obstructionist in both the lower and upper house, the Greens and Labor. But I’m talking about two women who actually are already on it. Two girls. One is 17 one is 21. They’re driving a Holden Barina around town. It’s gotta have petrol, hopefully it’s insured. Hopefully it’s got rego. I mean, just simply…
TREASURER:
I’d have to follow up with Christian on the case…
HADLEY:
It’s simple a matter of going out there and saying here they are, they’ve identified themselves. It’s our belief that we never wish to work. Good. Ok. They’re entitled not to work, but get them off whatever Centrelink payment they’re on tomorrow, because I guarantee today those same two girls are still drawing money on the public purse.
TREASURER:
Leave it with me and I’ll have a chat to Christian.
HADLEY:
Ok thanks for your time.
TREASURER:
Thanks Ray.