26 April 2018
Transcript - #2018055, 2018

Interview with Craig Zonca and Rebecca Levingston, ABC Brisbane

Subjects: Fully funding the NDIS without increasing the Medicare Levy.

REBECCA LEVINGSTON:

Treasurer, good morning. How will you fund the NDIS?

TREASURER:

What we've seen is the stronger economy that we've been working to provide is now really providing the revenue from the existing tax base to meet those commitments. A year ago, that wasn't the case and we believed that was necessary. So, the good news today is we can meet fully and the caller who just called in, yes, we will fully, absolutely look you in the eye and say that that funding for the NDIS is there and you'll see that in the Budget and that is an absolute commitment from this Government and it's guaranteed because of the stronger economy we're delivering. Now, that's how all essential services are ultimately guaranteed – hospitals, Medicare, aged care, all of these things are a function of a stronger economy and if you don't have one, well, that's what actually causes the tension. So yes, we're committed to the NDIS. Yes, we're committed to funding it and no longer do we believe that we need to increase taxes on Australians to do that.

CRAIG ZONCA:

That's a huge windfall for you, if you're talking about $8 billion to fully fund the NDIS over forward estimates. What happens in two years' time when the estimates, when the reality doesn't match the estimates?

TREASURER:

I'm not talking about estimates here. I'm talking right now that up to February alone, we're $4.8 billion up over what was estimated in MYEFO. As a Treasurer and as a Government, what we have been doing is conservatively forecasting. That means you don't overspend, you don't overpromise on revenue and as things improve, it puts you in a position to do exactly what I'm announcing today. Previous Government have done the opposite, the previous Labor Government did the opposite – they spent mining tax money that they didn't have. Now, that's not what we're doing here. We've taken the opposite approach and as things improve we can ensure that benefit firstly here is going to guarantee funding for the National Disability Insurance Scheme – something I'm very passionate about, I'm pleased we can do. That's why I announced the levy increase last year but if we don't need to do it then we won't do it. That's not at the expense of NDIS funding – quite the contrary.

LEVINGSTON:

When did you discover this additional unexpected revenue?

TREASURER:

Well, this has been improving since late last year and as we prepared for this year's Budget, it was one of the issues that then presented itself and we had to make a decision about and we made it.

LEVINGSTON:

There seems to be some ripples of concern – certainly from our callers and listener feedback this morning – do you think you should have consulted with the disability sector before making this announcement?

TREASURER:

Well, this is a tax issue and whether we should increase a tax. What we're doing is fully funding every single dollar that has been committed to the National Disability Insurance Scheme so that is not in question. There are no changes to the funding, there are no cuts to the funding of the NDIS – not at all. We are guaranteeing it. So this is a win today for families who have children or others themselves with disabilities, for their carers, it's a win for taxpayers and it's a win for the Budget too because it's ensuring we maintain the track for bringing the Budget back into balance as we've always said we would. So this is good news today.

ZONCA:

Is it a guarantee just for this financial year though? Or the next financial year?

TREASURER:

No, it's a guarantee. This wasn't something that we've just thought about for next year. When we came to Government, there was a $57 billion funding shortfall for the National Disability Insurance Scheme and that's what we set out to try and address. Now, first of all, we tried to do it with savings and that was rejected by the Senate. So, in last year's Budget, we said, "we will endeavour to do this through this levy." The Labor Party opposed that too, by the way. So, they've also said though that they were going to increase the Medicare levy for people earning over $87,000. Now, they said themselves that that wasn't related to the National Disability Insurance Scheme. So if they choose to drop that today, I'm not quite sure why they're doing that because they were just doing that to raise taxes. We were only doing the Medicare levy increase to support the NDIS. Now, what we've been able to determine now is that by focusing on a stronger economy, we can meet that commitment to the NDIS without the need for higher taxes. So really, if we're honest about it, the only people who should be disappointed today are people who want Australians to pay higher taxes.

LEVINGSTON:

Treasurer, do you reserve the right to increase the Medicare levy down the track for other purposes?

TREASURER:

We don't think we should increase taxes. You only increase taxes where it's absolutely necessary for a particular purpose. Now, we're very comfortable with the decision we've made about this and the direction of the economy under the economic policies that are making a stronger economy but that's the point. All services – hospitals, aged care, Medicare, Pharmaceutical Benefits Scheme, the pension – all of these things depend on a stronger economy and you don't create a stronger economy by taxing it out of existence.

LEVINGSTON:

The AMA has called on the Opposition to support your plan. How confident are you that Labor will fall in line?

TREASURER:

Who knows with them? They are always playing politics with this stuff so, look, they'll go on about politics today about who said what when. The question for them is are they going to continue to increase the Medicare levy and why were they increasing it in the first place given they said it wasn't being used to fund the NDIS? Labor will use any excuse to increase taxes because they can't control their spending. We control our spending and we run a strong economy and a strong Budget which has enabled us to do what we're doing today. I've got no idea what the Labor Party is going to do except one thing, they'll just tax you more and you'll pay more.

ZONCA:

This unexpected revenue that you talk about, Treasurer, from what part of the economy has that mainly come from?

TREASURER:

Let me talk about the $4.8 billion in higher revenues that have come in since the MYEFO up until the end of February – $3 billion of that was in increased company taxes , $1.2 billion of that was in personal tax improvements. That says companies are doing better and more people are in work.

ZONCA:

Do you still plan to cut company taxes?

TREASURER:

Yes.

ZONCA:

Why do that when you've got such a strong balance sheet? Company taxes are actually helping the rest of Australia's tax base to fund things like the NDIS.

TREASURER:

Because if I make companies pay the Government more then they're not investing in their business more, they're not investing in more jobs, they're not investing in higher wages, they're not investing in things that grow their businesses that support their shareholders who are your listeners.

LEVINGSTON:

Treasurer, appreciate your time this morning. Can I ask whether – just before you go – whether you might pick up the phone to someone like Kurt Fearnley who has been so outspoken in terms of the need for the NDIS and clearly his understanding of what you're doing is muddied because he's tweeted this morning, "This has been delivered on the evening of ANZAC Day, we continue to play politics and kick the can down the road, this move will not go quietly." People listen to someone like him…

TREASURER:

Kurt's an outstanding Australian and I assure him that that's why we're absolutely committed to funding the NDIS. The phone call I made about this was to my brother-in-law last night, who has MS, who I spoke about after last year's Budget. I made a promise to Garry that we're going to fully fund the NDIS and I'm keeping that promise – not just to Garry – but to every Australian with a disability.

LEVINGSTON:

Appreciate your time this morning, Treasurer. Thanks so much.

TREASURER:

Thank you.