24 March 2017
Transcript - #2017044, 2017

Interview with Kieran Gilbert, Sky News

SUBJECTS: The Turnbull Government’s plan for more affordable childcare; housing affordability; energy; Turnbull Government’s Enterprise Tax Plan to drive economic growth; trade; G20 Finance Ministers and Central Bank Governors meeting; London terror attack

KIERAN GILBERT:

Childcare changes have passed the Senate, with me to discuss this and the other issues of the day, the Treasurer Scott Morrison. Mr Morrison, thanks very much for your time. Is this a scenario where Derryn Hinch and David Leyonhjelm have actually helped the Government come up with a better package? Why would anyone earning over $350,000 a year warrant getting a government transfer?

TREASURER:

Well, that is the outcome. This is a very good day for families who need affordable child care. We first drafted and constructed these proposals some two years ago and I was the Minister at the time and I couldn’t be more pleased to see these now coming into effect. It is a great shame that Labor did their usual thing on blocking on this for two years. It was so unnecessary and we’ve not only be able to get the changes through the Senate which is tremendous. It means that low income families are going to get more support and obviously this is means tested, like all payments should be.

GILBERT:

Let’s look at the housing issue today. You are going to be meeting with the states. Is it fair to say and Tim Pallas, the Victorian Treasurer, I know has written to you in the lead up to this meeting. Do you concede that some of the states, including Victoria, could have done more on this issue than the Federal Government?

TREASURER:

The states have the levers to pull when it comes to housing affordability. They are the ones who control the supply. I am happy to acknowledge what the Victorian and New South Wales governments have already done. Victoria both from the supply issue and they have moved on to issues like shared ownership as well, NSW have from some time now have been opening up the supply of land and so on. I think they are good changes but there is more that needs to be done there and the planning and the zoning system. We will have good discussions about that today. We will also have good discussions about affordable housing, social housing. As you know, I am very frustrated, the fact that federal tax payers pay $1.3 billion a year in a one way ATM to the states and basically they don’t get anything in terms of housing supply or reform or anything of that nature in return. It is the worst deal I think Tanya Plibersek ever did on the Labor side but there’s a lot of competition on the Labor side for bad deals.

GILBERT:

On accessing superannuation for first home buyers, that has been criticised by a number of state Labor governments, Paul Keating as well as the architect of the modern superannuation scheme. He has been scathing of the idea. If you do do that you have to be very cautious about also having that supply side provided, don’t you? Otherwise you just pump up prices.

TREASURER:

Well, those arguments have all been made and this is a topic of speculation in the public realm, not by the Government. So, it is pre-Budget season, people speculate on all sorts of options that may or may not be considered. That is for them to do that. The Government certainly hasn’t been speculating on that issue or any others for that matter. So, look, those issues have been raised but let’s not forget it was Paul Keating who actually said it should be done, back in the 1993 election and people were standing on polling booths at that election saying, “vote for the Labor Party and you will be able to use super to buy a house.” So, that was just one of the many things he didn’t then follow through on.

GILBERT:

As a sign of good faith to the states should you be saying to them today that you are open to look at capital gains tax exemptions, for example? They want you to provide some constructive proposals.

TREASURER:

What the Commonwealth does in its realm is a matter for the Commonwealth. What I am looking to do is to ensure that where we are spending money with the states and the territories that we are getting real change in the area of planning and zoning reform and supply reforms and I acknowledge the work that has already been done by some of those states. Sometimes they are hard to compliment. They get a bit cranky whether you say they have done a good job or a bad job but I suppose that is the nature of politics.

GILBERT:

You have got to be careful of raising expectations though, don’t you? Because it has been described as a centrepiece of your upcoming Budget – housing affordability – but there is only so much governments can do.

TREASURER:

The Budget will be in May, Kieran, and that is what other people have described it as. The Budget is in May. It is important that we address this issue. It is important in Sydney and in Melbourne predominantly. That is where the issue is really most chronic. In Western Australia, for example, the prices are going the other way. Negative gearing and capital gains tax arrangements and Federal tax arrangements exist the same in Sydney as they do in Perth but there are two completely different outcomes.

GILBERT:

On the issue of energy, Tony Abbott has said today that the Government should step in and keep Hazelwood open through whatever measures are necessary. What do you say to that?

TREASURER:

There has never been a proposal of how that might be achieved and how federal taxpayers would avoid a remediation bill of, it could be well-over, $1 billion with compensation on other stations and so on. There has never been any proposal. The reason Hazelwood is closing is because of the mindless ideology of the Labor Party. The coal royalties and things like that from the Victorian Government and the cheers on the Labor side in terms of their positions on carbon taxes at the time and other measures – that is what is shutting the doors there at Hazelwood. I think it’s very unfortunate.

GILBERT:

If you stepped in to help them, others would expect it as well – would they not?

TREASURER:

The issue here, Kieran, that is an issue which had already had its rails set in terms of where it was going, sadly. What we have to focus on is how we ensure the security of supply and the affordability of supply going forward from this point. What is happening at Hazelwood, that is at the feet of Labor. They cheered on the closure of power-fired power stations. That was the outcome that Labor wanted and that is what they have achieved. What we are focussing on is how we deliver affordability and security going forward; whether it is on pumped hydro projects or any of the other resource based options that we have available to us.

GILBERT:

Two quick questions before you go. One on company tax – if you do get it through for small businesses up to a turnover of $10 million a year is that still a significant win in your view?

TREASURER:

That is a massive achievement. That is the biggest change to small business taxation that we have seen in a long time. Ken Henry said the threshold for small business should be $5 million – that is what he said. Labor is stuck at $2 million. We have said it will be $10 million. Now, remember the package has always had those components. A change to the small business definition, which not only gave them a lower tax rate but gave them access to the instant asset write-off, all the way to $10 million, pooled depreciation provisions and a whole range of measures that are available to small business. That is a thumping big reform for small business taxes in this country. We want to see the overall tax rate go to 25 per cent. Chris Bowen said that was what the aim should be to get it to 25 per cent. The hypocrisy on this issue is outrageous and if people want to see taxes lower in this country – particularly business…

GILBERT:

That’s still a win if you get it through?

TREASURER:

We want the broader change, if they want the broader change go and knock on Chris Bowen and Bill Shorten’s door.

GILBERT:

Last question on the Chinese Premier, he is here at the moment, two-way trade with China is more than the US and Japan combined and they are our second and third biggest trading partners. So, it is a huge trade relationship. Are you confident given you talked recently at the G20 that the Chinese are actually filling a bit of the void in terms of leadership internationally when it comes to trade matters – free trade matters?

TREASURER:

Well, they played a very constructive role at the G20 in ensuring that we got trade at a key part of the communique – very constructive. That was supported by others around the table and we had very constructive engagement with the Americans as well. So, at the end of the day, at the G20, I think we are able to arrive at a result that reflected where we were at that point and I think provided a strong basis at the next meetings and the leaders meetings and so on to get better outcomes. Everyone is around the table, everybody knows that the world economy is getting better – that was the real good news out of the G20 but for it to continue to get better trade must be open, trade must be at the centre of a global growth agenda.

GILBERT:

I should ask you as well, Pauline Hanson made that comment yesterday in the wake of the terror attack in London for a ban on Muslims – what did you make of that?

TREASURER:

I thought it was reckless and irresponsible. At times like this you focus on the issues of keeping people safe and yesterday was a terrible tragedy. We all have connections with people, I suspect, potentially, in the UK. You don’t have knee-jerk responses to these things. What you do is you do the diligent work which our security agencies do every day. What was happening yesterday was our AFP was working with other police forces around the country to ensure Australians were safe. That is what the Government was focused on. That is not a time to be pursuing political agendas. It is a time for focusing on keeping Australians safe and ensuring that all Australians. Every single Australian – regardless of your race, your ethnicity, your background your religion – is safe.

GILBERT:

Mr Scott Morrison. Thanks for your time. I appreciate it.

TREASURER:

Thanks a lot.