29 January 2016
Transcript - #2016009, 2016

Doorstop interview, Sydney

SUBJECTS: Citibank A50 Australian Economic Forum, Australian economy, Labor’s reckless tax and spend approach to the Budget, Cabinet

TREASURER:

It’s great to be here in my home city of Sydney and it’s always looking fabulous and to be joining with this very important conference today which is bringing asset managers and leaders from all around the world to focus on the real opportunities that are happening right here in this country. We have got a very exciting story to tell about what is happening in our economy, despite the obvious global uncertainty and volatility. Australia is really moving well against the head winds that are there for everybody. The diversification of our economy, the improving agility of our economy, the measures the Government is taking, whether it is innovation, trying to free up the tax system - all of these things are designed to do one thing - that is to support jobs and growth in our economy. In many ways it is very much a new economy and we're transitioning into it, moving away as we all know from the investment phase of the mining boom into this new phase. The new phase is exciting, because it's seeing more jobs, it is seeing more job intensive growth in our economy and there are good reasons for that and I'll be looking forward to talking about those issues with those who are gathered here in this wonderful city today.

QUESTION:

Is our AAA credit rating at risk and what are you going to cut out of the Budget?

TREASURER:

No, it's not and that is what the ratings agency said when we brought down MYEFO. MYEFO, our mid-year statement, was well-received by the ratings agencies and the Treasury Secretary has made some very good points about the need for us to continue to get expenditure under control and in the Budget and the forward estimates, our plan is to reduce expenditure as a share of the economy from 25.9 per cent to 25.3 per cent. We are actually reducing spending as a share of the economy as the Treasury Secretary acknowledged last night. So the path of fiscal consolidation is well and truly being followed by this Government. Now on the other side of politics we've got the old Labor tax and spend approach. The old Labor tax and spend. They have learnt nothing. Their plan is for higher taxes to fuel higher spending. That is not a plan for jobs and growth.

QUESTION:

On the issue of spending, will the Government match Labor's commitment to spend on education over 10 years?

TREASURER:

What the opposition has done is said it's going to increase taxes to support higher levels of spending. That's no way to run a Budget and you'll eventually run your economy into the ground if you follow that sort of an approach. What the Labor Party is refusing to do is to actually identify savings that can be applied to new expenditure. Now when they're prepared to have that discussion that's a different topic. Right now they just want to tax you more because they want to spend more.

QUESTION:

You're looking at tax reform, though. Will you guarantee that this will be in the Budget, or are you going to leave it until a later less politically sensitive time in the year?

TREASURER:

There is no more politically sensitive time than an election and the Australian public will be well aware about what our position is on all of these issues before an election. This election really is about who's got the plan for jobs and growth. Who has got the plan to keep expenditure under control? Who's got the plan to spur innovation in our economy in these times of quite significant global uncertainty and volatility? We've got the steady hand on the tiller here when it comes to these issues. We've got that balance where it needs to be on these issues. That's what I'm looking forward to discussing more with those gathered here today.

QUESTION:

Just what are the Government's plans to ensure that every Australian school child has the resources that they need?

TREASURER:

They're set out in our Budget. They are set out in the increasing commitments we have to education every single year, but it's not just about how much you spend, it's about how well you spend it. We've been spending more and more on so many issues, but I don't think the Australian people will turn round and say they're necessarily getting good value for that all the time. That's why we need to have better targeted spending, spending that is focused on getting outcomes rather than just pleasing interest groups and ensuring that we're keeping the tension in the cord when it comes to the Budget.

In these uncertain fiscal times globally, the volatile times that we have which have been I'm sure a topic for discussion here today, you want to be strengthening your financial position, not weakening it and the tax and spend approach of Labor just weakens that position. We want to go in the other path which is where we're heading - expenditure as a share of the economy under this Government is falling not increasing. Under Labor you'll be taxed more, because they want to spend more.

QUESTION:

Is this an indication though that we won't see the big spending pre-election Budget that we normally see before an election?

TREASURER:

I intend with the Prime Minister and the whole team to bring down a Budget which is sensible for the times that we face. That's the challenge of any Budget and that's the Budget you'll get from this Government.

QUESTION:

Have foreign investors conveyed an interest in seeing stability in leadership in Australia?

TREASURER:

I think they are seeing stability in leadership in this country and from our Government. What they're seeing is stability, I think, in direction, in policy-making and in clear intention to boost the innovative side of our economy, to boost the productivity of our economy. What they're seeing is, I think, the responsiveness of the Australian people to that. More than 300,000 people got a job last year. That's the highest jobs growth we've had since 2006 in a full calendar year. That's good news and the reason it’s happening is because our economy is transitioning, it's moving more and more to the services side of our economy. So places like here where we are today in NSW and Victoria as well I should stress, we are seeing those States pick up where sadly other States are doing it a bit tougher through that transition. Now we're not a one dimensional economy, we're a diversified modern economy that is looking forward. That is the leadership this government is providing.

QUESTION:

The former Prime Minister has a lot of experience in Cabinet. Would you like to see Abbott have a spot on the frontbench?

TREASURER:

They're matters for the Prime Minister and the Prime Minister has been very focused on the renewal not just of his own team, but of the economy and our focus is on the economy and on jobs and on growth and ensuring that we can put forward continually our plans for how we will boost that. The best guarantee against higher taxes is lower spending, and the opposition is only talking about higher spending, which means higher taxes.

QUESTION:

Is there concern, though, within the conservative flank of the Government that conservatives are being ill-treated by the new Malcolm Turnbull regime?

TREASURER:

No, absolutely not. I'd better get inside. Thanks for your time.