30 March 2017
Transcript - #2017054, 2017

Interview with Leigh Sales, 7.30

SUBJECTS: Fair Work Commission decision; Turnbull Government’s Enterprise Tax Plan to drive economic growth; Budget 2017

LEIGH SALES:

The Treasurer, Scott Morrison, joins me now from Parliament House. Thank you for your time, Treasurer.

TREASURER:

G'day, Leigh.

SALES:

Minimum wage, penalty rates, tax cuts. Why is this Government so often on the back foot?

TREASURER:

I don't agree with you at all on that, Leigh. What we're on the front foot on is progressing an agenda which I outlined in the Budget last year which has been reducing taxes for individual Australians. It's been investing in infrastructure. It's set up the biggest defence industry procurement program we've seen for many, many years. We're expanding trade deals all around the world. And we're rolling out and seeking to encourage companies to invest more in their own businesses for one simple purpose – so people can have secure jobs and higher wages.

SALES:

There was a row today over low-paid workers. Let me ask you the question that Michaelia Cash couldn't answer – how many low-paid workers live in high-income households?

TREASURER:

Well, the submission shows that the distribution of people who are on those low incomes is around about half, or just under half, are in those lower-income households, and so that's about the proximity of it, Leigh. We've got people who are on low incomes who are distributed right across the household income. You've got many people who are on very low incomes in low-income households. But equally, the point of the submission – which was also made in the submission that was prepared by Bill Shorten when he was the Employment Minister – noted that, equally, you have people in higher-income households who are also on low wages. That's the simple point. It's been made in submissions by both this Government and previous governments.

SALES:

So, if you're a low-wage earner in a high-income household, then are you deserving of less than a low-wage earner in a low-income household?

TREASURER:

That's an assumption you're making.

SALES:

I'm not making an assumption. I'm asking you.

TREASURER:

It's how the distribution of people on low incomes are across the very different household types that you have.

SALES:

Why do you make that distinction then?

TREASURER:

It's not just the Government who's made that distinction – Bill Shorten made that distinction.

SALES:

You have as well. I'm asking why.

TREASURER:

Otherwise the perception may be that everyone who is on a low income is actually in a low-income household. That's not the case.

SALES:

Do you accept that you are not going to get your company tax plan, as it stands, through the Senate?

TREASURER:

I believe, tonight, the Senate will vote to ensure more businesses – particularly small and medium-size businesses – will have access to a lower corporate tax rate and that is good for jobs.

SALES:

That's not what I asked.

TREASURER:

That's what I think's going to happen.

SALES:

Does that mean that you accept that you're not going to get your full company tax plan through the Senate?

TREASURER:

We'll see how the rest of the night pans out, Leigh. What I do know is, even at the level which others are commentating on, at a $10 million turnover – that is five times the small-business turnover as it's currently defined. That is the biggest change to small-business taxation we've seen in a long time.

SALES:

Sounds like you're getting your head around accepting the $10 million.

TREASURER:

What it says is that, of itself, that component alone, Leigh, is a significant achievement for this Government. If the adage is that, in today's politics, that it's 100 per cent of something or 100 per cent of nothing, then I don't think that's the practical way to approach politics. We're a Government that gets things done, and we get things done by turning up to work every day and being able to progress our agenda to the full extent possible.

SALES:

If your goal is to stimulate jobs and growth, handing these tax cuts to businesses with a turnover of less than $10 million is going to do very little in that regard, aren't they? Surely a business owner in a business that size would pocket it as a welcome windfall to help address their massive electricity bill, for example.

TREASURER:

If it is helping them deal with the rising costs of doing business, then I would have thought that was a good thing, Leigh. There are 100,000 businesses that have a turnover between $2 million and $10 million. There are 2.2 million Australians, Leigh, who work in those businesses. And at the very least, if that's what is achieved tonight, then I would say that that is a very, very good result for those 2.2 million Australians – and I wouldn't dismiss it in the way that some might.

SALES:

But it's not a great result for a Government that had a plan that wanted to go much further than that.

TREASURER:

Leigh, I'm not going to apologise for having aspiration and a commitment to trying to ensure that we have a competitive tax rate in this country. I mean, when John Howard introduced the GST, the original proposal was quite different to what eventually was worked through the Senate. So, we're not going to retreat from actually trying to do positive things for the Australian economy. The people who should be apologising to the Australian people tonight are the Labor Party, who have been the fly in the ointment on this, the hypocrites on this. They said – they know – that reducing company taxes will support higher wages and better jobs and more secure jobs. They've said it themselves. The fact they don't support it now is just a demonstration of their lack of commitment to better wages, more jobs, and more secure jobs.

SALES:

You said a second ago that you're not going to retreat on this ambition. Does that mean that, if, tonight, the Senate passes the tax cuts for the businesses with up to $10 million turnovers, that to the next election you will take the remainder of that policy again?

TREASURER:

Again, I'm focused on tonight, Leigh and the Budget's in May and all of this will be clear then.

SALES:

I want to know, tonight, if that legislation doesn't get through in its entirety, is the rest of it going to be a policy that the Coalition's going to stick with?

TREASURER:

Leigh, I'll just give you the same answer.

SALES:

Why can't you answer the question now? You must know.

TREASURER:

Leigh, because those things are all resolved in the Budget – and the Budget's in May.

SALES:

But you would know the answer to that question, and it's a relevant question tonight.

TREASURER:

It's a relevant question for the Budget in May.

SALES:

A review of the nation's economy was released this week by the Menzies Research Centre, chaired by Tony Shepherd, who's been an economic adviser to the Coalition. He's highly critical of middle-class welfare in Australia. He points out that social security makes up 42 per cent of all Commonwealth payments, for example, and he says that's unsustainable. Will you have the courage to axe big chunks of middle-class welfare in this May Budget, or will you be adding to that bill?

TREASURER:

Only the Labor Party wants to see bigger welfare bills and higher taxes to pay for them. We've actually put legislation into the Parliament to address the very issue that you've just highlighted, Leigh. I put it in my previous Budget. It was put in the budgets before that. And the people who have stood in the way of this consistently is the Labor Party – not the Coalition.

SALES:

So, we'll see those welfare payments continue to shrink as a percentage of Commonwealth payments?

TREASURER:

What the Government is doing is getting expenditure under control. We've consistently put forward measures to achieve that. We will continue to ensure that expenditure remains under control.

SALES:

One last question – do you have any explicit guarantees from the Prime Minister that, come the next Cabinet reshuffle, you'll remain as Treasurer?

TREASURER:

That's a ridiculous question, Leigh. The Prime Minister determines these things and I enjoy his full confidence and support.

SALES:

But the Prime Minister, it's always up to him who he has in his team, right? So, I would take that answer as meaning there is no guarantee?

TREASURER:

I'm very comfortable in my position.

SALES:

Scott Morrison, we'll look forward to talking to you on Budget night, if not before.

TREASURER:

Thanks, Leigh.