MONDAY, 4 MAY 2015
SUBJECT/S: Abbott Government’s broken promise on the Renewable Energy Target; Tony Abbott & Joe Hockey’s second Budget to save their own jobs; Justice Minister’s Ministerial Directive to the AFP.
LINDA MOTTRAM: Federal Opposition Leader Bill Shorten joins me this morning, ahead of delivering his pre-Budget speech at lunchtime. Bill Shorten a very good morning to you.
BILL SHORTEN, LEADER OF THE OPPOSITION: Good morning Linda.
LINDA MOTTRAM: You say the Government’s lost its appetite for reform, beyond that sort of tit-for-tat, you’d have to concede there is a huge amount to deal with here isn’t there? The Chinese slowdown, the iron ore price falling, revenue losses from flat wages growth now also impacting, it's not an easy picture.
BILL SHORTEN: You’re right, it's all about the future. Last year's Budget, though, the Government got the economy wrong. They pursued an extreme ideological agenda of unfairness. And of course the Parliament couldn't adopt an unfair Budget so it wasn't a strategy from the Government. This year now, the Government I think is just playing politics. And there are the big issues you say, so we'll be looking at the Budget on Budget night, and asking whether or not the Government has learned its lesson about fairness – in other words a Budget to be adoptable should be fair – but also, does it address the future? Does it deal with how we are a more productive, competitive nation? That's the test which Australians set, I think, for the Government. Are they planning for the future.
MOTTRAM: But the Government is looking at those things, I mean they’re thinking about reforming the tax system. Now when you were last in power, you had a big review, but certain things weren't actually on the table. How can you review a tax system if you don't look at it in its whole? This Government is reviewing the tax system in its whole.
SHORTEN: This Government has been in power for 604 days. Now they’ve just discovered the art of actually reviewing things. They've taken almost two years of this nation's life we won't get back. Labor has put forward sensible propositions. For instance, we believe there’s more that can be done to get multi-nationals to pay their fair share. We also have -
MOTTRAM: But that is something the Government is addressing.
SHORTEN: Well, not really. Let’s face it, the Government – Joe Hockey has thought bubbles, he said ‘we want to have a Google tax’. Now that's disappeared without a trace. What Labor’s done instead is we proposed a simple proposition which will see the bottom line of the Budget see an extra $7 billion plus come back to the Budget, because we get multi-nationals, foreign multi-nationals to pay their fair share.
MOTTRAM: Just on that, isn't that actually a deterrent to foreign multi-nationals doing business here - potentially disadvantageous to this economy?
SHORTEN: No. That's why we weighed up our measures. The truth of the matter is that Australia is a great place to do business. But we shouldn't be treated as mugs by foreign multi-nationals who go forum shopping to pay the lowest taxation, and in the meantime get the benefits of doing business in Australia.
MOTTRAM: But they might just forum shop their way right out of our country, mightn’t they? And thus further reduce the take.
SHORTEN: No, I genuinely don't believe foreign multi-nationals will go on strike if we make them pay their fair share. The whole world is grappling with how we, in the digital age, where capital is very mobile, make sure the integrity of our national tax systems isn't undermined. So multi-national taxation is an issue which Labor has put on the agenda for our work in the Senate, for what we are saying with our policy propositions. You see the fingernails of the Government being clawed towards dealing with this issue. But then it’s not just that that we have proposed. We’ve said we need to reserve the excessive largess of the Howard-Costello years, where they turned superannuation from being a retirement income tool for the millions of people into a tax haven for a few tens of thousands of people where you can have $10 million in your super, live very nicely off the interest of that and pay no tax. Yet if people of the same age were going to work, they'd have to pay a lot more tax. And I think Labor has put forward policies in the first half of our term of opposition, costed policies which the Government, if they weren't so political and simply said ‘It is a Labor idea, therefore, it is a bad idea’ and instead looked at the fundamental sustainability of our tax system, they should be looking at picking up.
MOTTRAM: Bill Shorten is here, the federal Opposition Leader, he is due to deliver his pre-Budget speech today. The federal Budget is of course next week and Deloitte Access Economics today saying $41.3 billion in the red, very scary likening it to certain people's rather scary novels. How do you most easily bring that back, because at some point it needs to come back? Is it by cutting spending or is it by increasing taxes?
SHORTEN: It is by growing the economy. That's the rising tide which lifts all boats to use a nautical analogy. If we grow the economy, if we see people earning more money, if we see businesses investing more, if we see confidence in the high street of Australia, then we create greater economic activity and that's what helps fuel the changes –
MOTTRAM: But how do we do that? There are so many factors that are so totally out of the control of nations these days. They're in the hands of a globalised network of transactions. Look at how we rise and fall on China's – you know, China sneezes and we catch terribly, terribly bad cold. How do you grow the economy? What's the answer to that in the future?
SHORTEN: Well first of all, there are changes underway in our economy, you have identified them, the transition from the once-in-a-lifetime mining boom to the more normal standards of investment in mining. What that means is we need to see more non-mining activity in Australia. Combine with that, you’ve got the internet, the digital revolution, changing business models from the media right through to education – you name it. And then of course we’ve got the rise of China. Now China is going to grow at about 7 per cent, and based on the size of their population and that marvellous middle class which is growing - not just in China but throughout Asia - these are all opportunities. But the basics needs to be done properly. At the last Budget, the Government took the axe to the pension. And they’ve spent a year denying they were cutting pensions. Now they are bracing Australians for a backflip where they actually concede they were taking literally billions of dollars off pensioners over the next 10 years - that killed confidence. Proposing $100,000 degrees - that kills peoples’ aspiration to think they can afford to go to university. The GP tax – the only way this Government can think to fund medical research is to tax the sick at the door of the GP surgery. They had an unfair Budget. They got the economy wrong, when we needed confidence, they scared people.
MOTTRAM: The Government has rejected the idea of a new charge on internet shopping but isn't that a sensible measure?
SHORTEN: Well I guess they are caught between a rock and a hard place –
MOTTRAM: Would you do it?
SHORTEN: Well, I will come to that. When we looked at it, we were told by experts that the tax would cost more to collect than it would raise.
MOTTRAM: So it was a bad idea?
SHORTEN: So, if you are going to bring in a new tax which goes to peoples’ cost of living and it costs more to collect than raise, it sort of defeats the purpose. We have said to the Government that on something like Netflix, we are open to working with them. The Opposition I lead hasn't been as negative as Tony Abbott's Opposition. In the last couple of months, we have offered the Government a deal on renewable energy and we have again done that today. We have offered billions of dollars in identified improvements to the Budget bottom line through tackling high end superannuation tax concessions – there'd still be a concession, it just wouldn’t be as ridiculously generous – and we’ve offered changes to foreign multi-nationals gaming our system. We’ve also put forward propositions around renewable energy and other matters of social justice such as tackling family violence. The Government needs to work with us and not view everything we say as a political opportunity to save Tony Abbott's job.
MOTTRAM: Okay, the federal Opposition Leader Bill Shorten is here. It is budget time, it’s getting down to the last few days for the Government to set the budget in stone. On the Renewable Energy Target which has left huge uncertainty in the energy sector, traditional and the alternative sector as well, what compromise would you make?
SHORTEN: Well, without taking too long, the story before the last election is both parties, Labor and Liberal, said they would keep the Renewable Energy Target. Tony Abbott's come in and he’s walked away from that promise – another day at the office for Tony – and he has taken an axe to the Renewable Energy Target. Labor has offered, though, a deal to the Government based upon what the Clean Energy Council and the industry say because, even though we want a higher Renewable Energy Target than the Government, we are prepared to meet somewhere in the middle because there's billions of dollars of investment and thousands of jobs on the line. So today we have reiterated that we offered them a target of what’s called 33,500 gigawatt hours. And we have said that if it helps the Government to do a deal, we will drop it by 500 to 33,000. I mean at some point the Government - they say they are the party of business – they've got to respect the voice of business and today all of business in Australia has said "Do a deal with Labor along the terms we have outlined".
MOTTRAM: Okay, but you've been dragged to this really haven’t you, because the minor parties were more likely to get a deal done if you didn’t come the party? You’d stepped away from it completely, you abandoned the space?
SHORTEN: Not at all. We just happen to believe that renewable energy is going to be part of our energy mix in the future. We want to see there is a renewable energy industry. We should be stronger at solar power, we should be stronger at wind power, we should be stronger at a range of the renewables. The problem is the Government just doesn't get it. So what we have said is we have taken a practical view. The industry would rather a higher target but they've said ‘Listen’ - my words, not theirs – ‘we have a bunch of Luddites in Canberra, the Government, who don't get renewable energy. We just need a deal to keep our flow of work’. We’ve said fair enough. Because at the end of the day, if Labor was to form government, we would do more on renewable energy. But in the meantime, we don't want Tony Abbott to wreck the industry forever.
MOTTRAM: Well, let me just ask you this one last question if I may, non-budget related, the AFP speaking later this morning on the Chan and Sukumaran matter, after their role in effectively handing the Bali Nine to a jurisdiction with the death penalty, Indonesia and we’ve seen we’re that led. Why did the Labor Party last week pursue this idea that the Government had somehow watered down the instructions to the AFP on this when it appears that that’s actually not the case?
SHORTEN: Well they had, but just let me again, very quickly I’ll go through it. 2006 while John Howard was in they did a review of the circumstances and what information the AFP should hand to Indonesia following the arrest of the Bali Nine and people realising that the death penalty at that stage could be an option as sadly it’s materialised. Go forward to 2009, Labor then, well the AFP changed the guidelines which said that the AFP had to take into account the death penalty in jurisdiction where they’re handling information –
MOTTRAM: So that’s the operational guidelines.
SHORTEN: That’s true and that hasn’t changed, Government’s spot on, on that.
MOTTRAM: It hasn’t changed.
SHORTEN: No, but in 2010 the Minister makes a direction as he can under the Federal Police Act, I think it’s Section 37, and the Minister specifically set a direction to the Federal Police. See the police shouldn’t be the meat in the sandwich here, the government of the day needs to spell out its priorities to the police about what they want, that was 2010, the Labor administration said the death penalty, we’re against this. Now in 2014 it emerges that the Government had changed that direction so the Government’s being a little cute. On one hand, you know, it’s an uncomfortable issues because we’re all saddened by the execution of these two men and that was a futile waste of two lives, but the question is, and if the Government has got a straight answer why did they drop in the Ministerial Direction stated policy of opposition to the death penalty?
MOTTRAM: Okay but the operational position of the AFP itself remained unchanged?
SHORTEN: The guidelines remained unchanged but at the end of the day ministers are in charge. It says when a government, when an elected government, the elected representative, the ministers, they’re not just there to cut ribbons and eat tea and scones with the police. They spell out the priorities and directions. There may be a perfectly reasonable reason why they did it, why won’t they tell us? And it did change.
MOTTRAM: Okay Bill Shorten, thanks for join us this morning.
SHORTEN: Thanks very much Linda.
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