FRIDAY, 12 OCTOBER 2018
SUBJECTS: Labor’s promise to deliver tax cuts for small and medium businesses with a turnover of up to $50 million a year; Liberal chaos on climate policy; Wentworth by-election; AFP raids; religious freedoms; asylum seekers.
BILL SHORTEN, LEADER OF THE OPPOSITION: Hello everybody. I'm pleased to say that Labor has crunched the financial numbers, we've consulted with our colleagues. I'm pleased to say that Labor will support a tax cut for small and medium enterprises, matching what the government's proposed yesterday.
Labor has always been a friend of small business, and we want to provide constructive certainty. But unlike the Liberals, we will make sure that we can accelerate the implementation of the 25 per cent corporate tax rate, without cutting funding to schools and hospitals. Labor wants to make sure that we hand on a better deal to the next generation; a better deal in school funding; a better deal in our hospitals and a stronger economy. Because of the difficult decisions, reform decisions that Labor has made in Opposition, we are able to constructively agree with the Government to provide certainty to small and medium enterprises. The good news at the next election is that people in small and medium enterprises can vote Labor or Liberal, but if they vote Labor they'll be getting the same tax reductions as they would if they voted Liberal.
I'd now like to hand over to Shadow Treasurer Chris Bowen, to expand further on how we were able to come up with this very constructive approach, for a better deal for small business.
CHRIS BOWEN, SHADOW TREASURER: Well thanks very much, Bill. Well if you are a Liberal Prime Minister or Treasurer, and you have the longest-serving Treasurer in Australian history, Liberal Treasurer Peter Costello, telling you your economic policy is weird, you know you've got a problem. Josh Frydenberg said when he became Treasurer he would be turning to Peter Costello regularly for advice - he got some yesterday. And one of the reasons I think Peter Costello made that call, that quite extraordinary intervention, is the lack of consistency from this government. And that is particularly stark these days, in their lack of consistency when it comes to budget rules and tax. We have seen the rolling farce of the different budget rules being announced over recent weeks. But the Government yesterday announced a tax plan with no offsets and said it would be paid for out of economic growth and the surplus. A clear breach, a clear breach of their own budget rules which say that improvements in the economy will go to the budget bottom line. Well as Bill said, Labor has considered the Government's proposal and will match the Government's tax proposals, but will do so in a more fiscally responsible way than the Government. The Government may be prepared to throw budget responsibility to the winds, but Bill Shorten and Labor are not.
So this morning Labor's Shadow Cabinet has accepted the recommendation from Bill and I, that in the interest of certainty for small business we vote for the legislation through the Parliament, and commit the same tax rates for small and medium sized enterprises under a Labor or Liberal Government. But indeed, under a Labor Government all businesses will, when it comes in, also have access to the Australian Investment Guarantee. So in fact, Labor is offering a better tax offering for businesses than the government. The same headline rates but with Labor as well, during our term the Australian Investment Guarantee as well.
Now we can make these decisions and these commitments as Bill said, because we've made the tough decisions elsewhere. We've made the tough decisions consistently now for five years, Bill. Tomorrow being the fifth anniversary of Bill's leadership. We've made these tough decisions, we've made the big calls and we've also said that we can deliver bigger budget surpluses than the Government over the forward estimates. We can make important investments in preschool, in schools, in women's superannuation, in health and other things, and we can also match the Government now when it comes to small and medium sized enterprise tax. And to underline that fiscal commitment we have made the decision to delay the implementation of our Australian Investment Guarantee by one year. That will reflect in Labor's budget bottom line, which ensures that we can make these commitments in a more fiscally responsible way than the Government.
We have maintained our fiscal discipline, and not only have we made tough decisions but we're also prepared to make sure that our election commitments lead to bigger budget surpluses over the forward estimates, which means we have delayed that Australian Investment Guarantee by one year. But that, in the light of an agreement effectively now between the Government and the Opposition on corporate tax rates, and a substantial commitment of budget funds, Scott Morrison says tax cuts don't cost money. I'm sorry they do, they do result in smaller budget surpluses. As a result of that decision we have made the responsible, prudent, careful decision to simply delay the Australian Investment Guarantee and it's implementation by one year, one year. Now that means that you can have the same tax rates for businesses under Labor and you get Labor's commitments to schools and hospitals funding. The Government can't tell you how they're going to pay for their tax cuts, so that means that going forward schools and hospitals funding will always be under threat under Scott Morrison, or whomever the Liberal Prime Minister is after the next election. They'll always be under threat, and we’ll always have the risk of a 2014 Budget all over again because Scott Morrison and Josh Frydenberg have refused to make the tough decisions that Bill Shorten and Labor have made, and have been upfront about.
SHORTEN: Thanks Chris, are there any questions?
JOURNALIST: Mr Shorten are you surrendering at the first sign of attack?
SHORTEN: Not at all. In fact we are determined to restore people's faith in politics. And that means sometimes, not simply opposing an idea because someone else had it. Labor has always been the friend of small business. Labor has done a lot of homework in terms of being able to pay for any promises we make. Our first question yesterday when we heard of the proposal, is we want to make sure that it doesn't involve cuts to schools and hospitals. That is core business for Labor. Making sure our kids get the best start in life. Making sure that when you're sick you can afford to go and see a doctor.
But having said that, Labor has been working hard in opposition to make sure we can fund our promises. We had a scheme called the Australia Investment Guarantee. That would have meant that businesses who invest in new productive technology could claim an accelerated depreciation, get a bit more back off their tax for investing in this new productive technology. We are able to delay that idea by one year only. And what that means is that money which we had allocated to go to what we think is a very good idea to help business, rewarding them for future investment, we said well, let's not make the perfect the enemy of the good. So if the Government says that it has the view that business wants to have a slightly – if small businesses want a slightly lower tax rate earlier than the government was otherwise planning, we are prepared to compromise in the national interest. This is the sort of government I intend to lead. So what you might perhaps just describe as politics, I see as actually getting us beyond politics. When there is a good idea, Labor will try and see if we can make it work.
In this case, our challenge is now to Mr Morrison. We have agreed to support legislation because we think it can be affordable. What we now ask the government to do, is to reverse their cuts to public schools in this country. I think it is shocking that the Liberal Government in Canberra is still persisting with over $14 billion worth of cuts to schools over the next 10 years. What that means effectively, is fewer teachers, fewer choices, and a lesser start in life for our kids, which surely, handing on a better deal to future generations - isn't that why everyone is in politics?
I might just share the questions, you were next.
JOURNALIST: Will you seek to expedite debate in the House now that -
SHORTEN: Well that's up to the Government. But the point about it is, this is one less issue for the nation to have to waste time arguing about. People are sick of the Punch and Judy show in politics. I promise Australians that if I'm elected, we will focus on issues that matter. We're not going to waste time in needless disagreement or debate. You know, let's tick this box and let's move on to what we are going to do to properly fund our schools, our hospitals, and we do need to take more attention to the issue of climate change. I was shocked when the government just simply ignored the best scientists in the world and said they are not going to do anything about improving policies to tackle climate change. That is not handing on a better deal to the kids, is it?
JOURNALIST: So are you accepting that tax cuts are essential to improving the economy? And how will these cuts be paid for under your government?
SHORTEN: I'll get Chris to supplement this. Labor has always been happy - especially I have to say, for small business, if we can help reduce some of the financial burden on small business, it is an important part of the Australian economy. But let me be very clear, our first priority is to make sure that we fix our schools and hospitals. Labor has made decisions such as not supporting tax relief for the big end of town, making sure that multinationals who earn money in Australia, who earn profit in Australia, pay tax in Australia. And we are not going to retreat from that. We accept it is possible to afford this measure, and for the sake of small business certainty we are up for it, because we are able to delay some other decisions which we were going to spend some money on, and we'll delay, just so we can get certainty. But Chris might expand further on your question.
BOWEN: Well as Bill said, this is primarily about certainty. The Government always had a one point plan for economic growth, and that one point plan was a big business tax cut, $17 billion to the banks, 60 per cent of it would go offshore. Now they've said they've got another plan which is small and medium sized enterprises. Now as Bill indicated, we have always accepted the case that there needs to be special consideration for small and medium enterprises and particularly in relation to certainty. Now by bringing these tax cuts into the forward estimates, it's legitimate that we examine the matter of certainty, and that we provide small business with that certainty for investment. It doesn't matter who wins the next election, they'll have the same tax rights.
But particularly as I say, we remain committed to the Australian Investment Guarantee one year later, because our tax relief which is a point of difference between us and the Government is conditional on investment, conditional on investment. Not a windfall investment - not a windfall gain for investments made many years ago, which would be the implications of the Government's big business tax cut. But we say to businesses, if you're prepared to invest in Australia, to grow Australian jobs, then we will work with you in the Australian Investment Guarantee, and we'll provide the same headline tax rate as the Government.
JOURNALIST: In terms of companies turning over up to $50 million, you've gone from 30 per cent to 27.5 per cent and now to 25. Don't you think voters are entitled to ask what do you actually stand for?
BOWEN: Well Eryk with respect, we have responded to a government announcement. I mean, there was no government policy before yesterday to bring these tax cuts forward. We've have acted expeditiously, as you might recall Eryk, you were at the press conference I said we would do. Bill and I acted expeditiously, making a recommendation to Shadow Cabinet, and Shadow Cabinet has accepted to respond to the change in circumstances. I mean the government has changed policy, so we have to respond. Now Bill and I didn't wake up this morning and say well let's change policy, what we did was respond to a change in government policy from yesterday, from yesterday. So when the Government changes its policy, it is incumbent on the alternative government to react as we have done, and I think it is fair to say quickly and decisively.
SHORTEN: Let's face it, Mr Morrison wants to politicise small business and pretend that somehow he is more fair dinkum about small business, well he is not. We're not going to have small business dragged around the political football oval to be kicked around. What we are saying is we think we can afford this change, but so long as it doesn't involve cutting schools and hospitals. Labor has made hard decisions, we are going to tackle multinationals; we will not support corporate tax cuts for the big end of town. But what we are able to do is provide certainty to small business, and what I say to Mr Morrison is, we are being constructive on small business as we should by the way, that is our day job, to be constructive where we think it's appropriate. But now it's Mr Morrison's turn. Reverse the cuts to public schools, reverse the cuts to hospitals, and do something about climate change because we are handing on a worse deal to our kids. And what is worse is all Australians, businesses and households, are paying higher energy prices because of the climate change denialists who are running the current government.
JOURNALIST: So do you believe a small business now turns over $50 million a year? That's a small business?
SHORTEN: That would be a medium sized business.
JOURNALIST: So it's about more than small business now, and you are in fact going up towards almost corporation level at $50 million?
SHORTEN: Let's be very clear here. I know that if the Liberals get re-elected they will be back, renewed and energetic to give tax cuts to large companies. We will not. We think this nation needs to put working people first. We buy the argument that small businesses need a hand, they are doing a lot of good things. We're not going to quibble about is a small business $10 million or $11 million. But what we are not going to do is to vote ten times to give large corporations a business tax cut. Ten times is the number of times that Mr Morrison voted to give large corporations business tax cuts. Mr Morrison voted 26 times to stop a banking Royal Commission. The reality is that we want this country to have a fair go for all, not just for some. Sorry, you were next.
JOURNALIST: Labor was actively legislating to stop the tax cuts proceeding below 27.5. You're saying the only thing that has changed since then is that Mr Morrison's made an announcement about policy?
BOWEN: Well, it is undeniable that yesterday he changed policy. I mean that is just a statement of fact. He held a press conference and he changed government policy. The appropriate thing for the alternative government to do is to work it through and respond.
JOURNALIST: But why can't you have your own policy? Why do you have to be a reactive government in that sense?
SHORTEN: It almost sounds like you want us just to be negative for the sake of being negative. People are sick and tired of negativity for the sake of being negative. I accept that in Australia, if there is a good idea, we should at least do it the courtesy of having a look at it. Because Labor has made some hard decisions, because we want to reform negative gearing, because we want to see multinationals pay more tax, because we want to roll back unsustainable tax concessions which favour the few. Because we have made those hard reform decisions, Chris and I and our united team, we able to respond expeditiously, and if an idea is not a bad idea and we can see some merit in it, well we’ll work with it. That is the sort of government Labor will be, we will govern for all. We won't look at any idea that our opponents have and because our opponents have it, immediately say no. People are sick of that Eryk.
JOURNALIST: If it does start impacting though on the budgets for hospitals and schools, does that mean that the rate could potentially go back up again?
SHORTEN: Let me be clear here. We have made some economic reform decisions, strong decisions, tough decisions that mean that we can now pay to restore the cuts which the Liberals have made over the last five years to public schools, to hospitals. We are able to do this because we have made other policy decisions. See Mr Morrison still prefers to back property investors over first home buyers. Mr Morrison won’t do enough to make multinationals pay their fair share. I think most Australians agree with Chris and I, that multinationals whose products you buy in Australia, who make a big profit in Australia, then pay very little tax in Australia, people are sick of that. But if you want to keep multinationals honest, you should be voting Labor. If you want to make sure we have better schools not more profitable multinationals, then that is where Labor comes in.
JOURNALIST: What about the investment guarantee? Those businesses who may have made some decisions about plans to invest in the future, you're now telling them that you're going to delay it for a year -
BOWEN: Eryk, I think you really with respect, might be stretching things now. I mean, Bill and I and our Labor team aren't getting ahead of ourselves that we have got the next election won, and I do not think businesses are either. I don’t think a business would have made an investment decision on the proviso that Labor is going to win the next federal election. I know that you know, there is also the betting markets and things out there, but we are focused on the task of winning the next election, and I don't think any Australian business would have made investment decisions based on Labor winning an election, implementing an Australian Investment Guarantee, and plenty of time before the next election. Here we are being very, very clear, as we have been now for five years, five years setting the policy agenda, announcing our own policies. As Bill has referred to some of them like negative gearing, for five years, we have been setting the policy agenda. The Australian investment Guarantee is one of those. Now sometimes, in the face of changed circumstances, like a changed government announcement, you obviously have to respond and recalibrate. That is exactly what Bill and I and Labor have done.
JOURNALIST: So does delaying the investment guarantee by 12 months completely cover the $3.2 billion cost of this?
BOWEN: Well delaying the investment guarantee saves Labor's budget bottom line $2.8 billion. Now, the Government says that they're paying for it through economic growth. What we are doing is obviously saying we maintain our budget rules which means bigger budget surpluses over the forward estimates. So if you like, what we are doing is ensuring our ongoing commitment to fiscal sustainability and bigger budget surpluses as well as funding schools, hospitals, preschools, women and superannuation and everything else we have announced, and will announce in a carefully, calibrated manner.
SHORTEN: People shouldn’t forget under this Prime Minister - remember he was the Treasurer before he was the Prime Minister and he has been a Cabinet Minister for the last five years - this government has doubled our national debt. This is a government who are living on the never-never, they are living on the nation's credit card and there will a bill to pay by the Australian people. What we are doing when we decide that we can improve the deal for small and medium enterprises, is we ask ourselves how do we pay for the promise before we can make the promise. This is a government who is writing cheques and they have not explained how they're going to pay for them.
JOURNALIST: How confident are you that either an independent or Labor will win in Wentworth on the weekend?
SHORTEN: It is going to be up to the voters of Wentworth. I noticed though that Mr Morrison has attacked Mr Turnbull's son. Alex Turnbull is entitled to his opinion, I am not surprised that he is disappointed with the shabby way that Malcolm Turnbull was treated by the Liberal Party, that he probably does not feel like voting Liberal. But his comment were specifically about climate change. What is it about the modern Liberal Party that they keep refusing to accept the science of climate change? The best scientists at the United Nations have come out and said this is a real issue and you can't bury your head in the sand. So what has Mr Morrison and the climate denialist who currently run the nation do? They immediately say we are not going to listen to the best science in the world. All I think Alex Turnbull is doing is saying what a lot of people think. That this government is not tackling climate change, we're going to hand on a worse deal to our kids, and our energy prices keep going up and up and up.
JOURNALIST: If Labor wins the next election, how is it going to tackle the growing population issue? Is there any merit in thinking about sending migrants to the regions or encouraging them there, or a cut in the overall intake?
SHORTEN: First of all, we have written to the Prime Minister and said we need to have a joint taskforce, get everyone in the same room to talk about the ideas. Let's agree together between the different levels of government, let's agree and find out what the community is thinking and let's plan our population growth together. There is too much shouting at each other. Now the problem in Australia right now is that the two top Liberals, the Premier of New South Wales and the Prime Minister of Australia, can’t even agree about the future of Sydney. They can't even agree about do you half the migration, where do you send the migrants? What we need to do is take politics out of it. One thing is for sure, if you are someone who caught a train today or drove into work in our big cities, you will be highly frustrated in congestion. For the last five years, the national government hasn't had a plan on population and we are all paying the price. For the last five years, the current government has not invested in public transport, hasn't invested in our cities, and what we're seeing is people getting increasingly and increasingly frustrated at what is happening. So what Labor will do, is we will sit down with the experts, we will listen to the people, we will invest in infrastructure, we will invest in roads and we will invest in public transport. We're open if migrants - if we can come up with a plan, a constructive plan, about some of the migrants going to the bush, we are up for that. But people have been talking about that for decades and it is not the easiest problem to solve. We will be constructive.
JOURNALIST: And do you support further public service whistleblower protections to stop things like the Home Affairs' raids from happening?
SHORTEN: We have said, Labor has stood up for whistleblowers by saying that we assert one of the Westminster system's oldest traditions, Parliamentary privilege. I actually think one one of the best steps we can do to restore public confidence in political life is to have a national anti-corruption commission. We call it a National Integrity Commission. I don't think that politicians and the Commonwealth should be immune from the sort of standards and systems which we have at some of our state levels. I think it is long overdue for the Liberal and National parties to join with Labor and set up a National Integrity Commission. I don't think there is, or certainly I am not aware, of corruption at the highest levels, but what I am aware of is people are not satisfied that transparency is there. I think that if the Morrison Government has nothing to hide, then they have nothing to fear from a National Integrity Commission.
JOURNALIST: Scott Morrison says he does not want any child discriminated against and says changes to the law would be curbing discrimination that was allowed by laws introduced by Labor. Is Labor to blame for this?
SHORTEN: I don't mind saying I have been a bit disappointed in the last 48-72 hours, about the strange silence of our Prime Minister on the issue of whether or not you should extend laws to allow discrimination against kids who are gay. As soon as I heard about it, I said it was a silly idea. You know, Mr Morrison shouldn't be blaming Labor and what we would say to the Government is this: as any parent, there is no case, there is no rationale to discriminate against kids based on their sexuality. Those laws are out of date, if in fact they were ever in date. I have been speaking with some of the religious educational administrators in this country, they don't even use the existing laws. So if Mr Morrison wants to back up his statement, I will work with him to make sure that no child is denied human dignity.
JOURNALIST: Mr Shorten, you called for independent trustees to be considered - appointed to retail funds. What about industry super funds?
SHORTEN: First of all the context to which I raised it, and you were there last night, is I was asked about the Productivity Commission's report about reforms to banking superannuation. The challenge for Australia's banks is that they are governed by the Corporation’s Law, which basically puts shareholders as the number one importance for corporations, for banks. But our superannuation system and trustees should have as their number one priority, the beneficiaries, the members of the superannuation fund. So the tension within banks, the conflict of interest which they face - and it's a real issue, is the banks are about profits for the shareholders, whereas superannuation funds need to be about the best returns for members of the superannuation fund itself. So what I raised last night – and we have got to talk about it, we have to see what the Royal Commission decides, we have to go through our policy processes - is perhaps if banks want to stay in superannuation, and some people say they shouldn't either. But if they want to stay there, they need to consider transferring some of the trustee roles, that's the people who run the superannuation funds, to independent organisations. Because when you run a superannuation fund, you can't serve two masters. You should serve the members of the fund's interest - their best interests first.
JOURNALIST: Do you think it's time that asylum seekers get taken off Nauru?
SHORTEN: We are committed to stopping the boats. If the boats start again, what happens is innocent people drown at sea because criminal syndicates exploit their vulnerability and desperation of a better life. Having said that, five years has been too long to resettle some of the people we have in our regional processing. We support the American deal. I think the Government should accept the offer of New Zealand to resettle some of the people in Nauru. And in terms of children, where there is a health question, where the treating doctor thinks they should get medical treatment which not available on Nauru , then those kids should be able to receive that treatment as a matter of priority.