13 October 2015
Transcript - #2015017, 2015

Doorstop interview, Canberra

SUBJECTS: Business and consumer confidence levels; superannuation; Harper Review; housing prices; MYEFO; financial services inquiry

TREASURER:

I’m very pleased to just note today, as I did in the House, the rising levels of both business and consumer confidence today. What that means is the Government needs to continue to earn the confidence and the trust of the Australian community. It must earn the confidence and trust of the business community and give people the reason for the confidence which we are pleased to see they are so far expressing. That confidence is not something the Government will ever take for granted and the way it is earned is by doing the things that assist those businesses and those Australians to be able to transition, to move through this transitional period in the economy so that they can do the things that they need to do and to set themselves up for success, particularly over the medium to long term.

QUESTION:

Treasurer, do you have, there was reference in Question Time today on superannuation, do you have concerns about the equity in the distribution to superannuation acceptance?

TREASURER:

Well, we have begun a process, following the change in leadership, to look at the questions in relation to superannuation. I would just make two simple points about the principles that I think have governed how we do that. The Murray Inquiry, I think, made a very useful recommendation about us needing to be clear about what the purpose of superannuation is because I think once you understand and can set out clearly and agree what the purpose is then the policy decisions that can flow from that I think become more understandable for people. The reason we provide tax incentives for people to invest in their superannuation is to ensure that when they reach retirement age they will not be dependent on welfare payments. That is the purpose. This is the necessity of the policy and whether it is in the pension, where people would be aware of the changes that were made when I was Minister for Social Services, we made it very clear that the purpose of the pension was to be a welfare payment for those who were not able to be in a position where they could be self-supportive. Now, it is our objective to see as many Australians as possible be self-sufficient in their retirement and we need a system that will encourage that. The second principle is the one of certainty. When you are asking people from a very young age to set away what they have earned for 20-30 years they need to have confidence and certainty about what will happen 20 or 30 years from now. I think it is very important that those who have saved over the course of their life have a level of certainty about how their incomes will be treated in that retirement phase. I think these are important principles and the ones that sit very much at the heart of a Liberal National Government and we will continue to look at these matters in this context.

QUESTION:

Would that mean that any changes would be grandfathered? Would that be a way of embracing both that sort of key principle?

TREASURER:

It means that anything that we would look at and put forward for discussion would be consistent with those principles.

QUESTION:

Section 46, you alluded to it earlier – where are you up to on that?

TREASURER:

Well, as a new Treasurer and taking responsibility for competition policy, I am going to take my time to consult and to look at the various arguments around this question. I don’t come to this question with any sort of ideological position. What I do want to see is greater competition and what I do want to see is businesses – both large and small – being able to realise their potential. That is what productivity is by the way; productivity is a firm, a company, a business, an enterprise, an individual being able to realise their potential. So, when people hear us talk about that, that is what we are trying to achieve - to help you realise your potential in the workforce, as a business and be the best we can all be. So, when it comes to the Report put together by Professor Harper, yes it did go to questions on Section 46 and I think they are very important questions but I think the focus of commentary on that one, one element of what is a very large report, I think ensures that the broader points about the gains that can be made in human services delivery at a state and local government level and territory level I think have been passed over and I wouldn’t want that to happen. That is why I have put that on the agenda for the state treasurers’ meeting this Friday. I want us to sit down together and discuss what the opportunities are. I said earlier about what the opportunities are around, last time we did this, around the Hilmer Reforms and the process that followed that. We need to investigate what the opportunities are out of the Harper proposals to achieve a similar level of economic growth and prosperity that we were able to achieve from those reforms.

QUESTION:

So, is your instinct to do it more as a package rather than cherry picking one-off items out of the Harper Report?

TREASURER:

I think we need to embrace the spirit of this report and see what we can do collectively because it is not just about the Commonwealth. I mean many of the matters raised in the Harper Report go to issues of state and territory governments and they will be the great beneficiaries of looking at what can be achieved along the principles of what is in that report. As a result the Commonwealth would be a great beneficiary of that process. There is no area of government that can say that they have reached the point where its service delivery has reached the zenith of its efficiency and its effectiveness. No level of government can say that and what the Harper Report encourages us to do is to look carefully how we can do that, particularly in the area of human services which is the growth centre of our economy. It is no longer just important because of its very important social benefits but it is also very important now from an economic perspective and we need to understand how those two things can work together for people’s social wellbeing as well as our economic prosperity.

QUESTION:

You said on this meeting on Friday with the state treasurers that you will be talking about Housing. Apart from the normal encouragement for states to release land, what more can be done? Where are you headed on that housing front?

TREASURER:

My views on housing haven’t changed. You have got to look at the housing sector as a complete system. Those who are purchasing houses, those who are trying to purchase a house, those who are renting, those who are in need of affordable rental accommodation as a hybrid between the private market and the social housing delivery. We have got about 5 per cent of people who rent in social housing in this country and frankly the way we deliver social housing in this country is archaic. The models are over a century home and the amount of assets and resources that are tied up in the delivery of those services, people around the country know the frustrations they have with dealing with that, the frustrations they have in trying to work to get people out of homelessness. We have a real opportunity to work together. You know we spend almost $11 billion a year as state and territory and federal governments on housing support every year. Almost $11 billion and I can tell you those who depend on that support I don’t think would be giving it a very big tick in terms of its effectiveness. That’s the challenges for the states and territories together with the Commonwealth to see how we can do that better. It isn’t just about housing affordability to buy a house; it is about rental affordability, it is about the effectiveness of social housing and how that is delivered and it’s also about getting people out of homelessness.

QUESTION:

Do you have any further indication on the timing of MYEFO? When is that going to come out?

TREASURER:

It will be before Christmas, there has been no change to the timetable.

QUESTION:

Will it be sooner rather than later?

TREASURER:

It will be in December and that has been the plan for some time now. So, there has been no change to the plans for MYEFO whatsoever. We are working to the same timetable and that will be another important document along the Government’s economic plan.

QUESTION:

Are you any nearer to coming back on the financial services inquiry?

TREASURER:

It’s imminent. The process that the former Treasurer and the former Assistant Treasurer worked through was very extensive and I have taken the opportunity over the last few weeks with the new Assistant Treasurer to touch base with some key principals in the financial sector and I think that process has been very well run and we will be making some announcements about that in the not too distant future.

Thank you.