10 May 2018
Transcript - #2018087, 2018

Interview with Tom Tilley, Triple J Hack

Subjects: Budget 2018

TOM TILLEY:

Well, let's go to the Treasurer himself. Scott Morrison, thank you so much for joining us on Triple J.

TREASURER:

Pleased to be here, Tom.

TILLEY:

There's loads of questions we want to get through, but the first one is, what's your one favourite thing in the Budget for young people?

TREASURER:

Providing tax relief for when they get their first job. I mean, that's what happens. Under our tax plan when they are in a job which is earning less than $90,000 a year, they'll be benefiting straight away from lower taxes and because…

TILLEY:

So ten dollars a week though. Is that enough to really excite them? Is that your favourite thing for young people?

TREASURER:

Five hundred and thirty bucks a year, now I remember when I got my first job, that was a lot of money. Still is.

TILLEY:

Ok, well, lots of people are asking the question about fairness in this Budget. You said last night in your speech that it was a Budget, it was a plan for a stronger economy. But is it fair people are questioning no new increases for people on unemployment benefits? There are thousands of dollars of tax breaks for high income earners over the next seven years. Tens of billions of tax cuts for big corporations. Is that a fair Budget for people who aren't so well off?

TREASURER:

A stronger economy is what everybody depends on. When I left university and I went into the job market, we were walking into a recession. Unemployment rose to over 10 per cent. Interest rates hit 17-18 per cent. That was the economy that those from previous generations faced. I don't want an economy like that for the generation that I'm speaking through your program to now and if you want a stronger economy, then you need to ensure that it builds and that it grows and the businesses can take people on, and it's our very firm view and strong view that you provide the tax relief both to those who are creating the jobs, and when you're out there earning a living, that you get rewarded for what you put in. And it's a very different time, I know, from when I left university and started out.

TILLEY:

Sure.

TREASURER:

But the same thing is true today. The economy that young people will live in in the next ten years will determine so much of their choices. You can't take the economy for granted. I know that many people at that age have never known what it's like to live in an Australia where there's a recession, and I think that's a great thing, and I don't want them to find out.

TILLEY:

But is it just about a strong economy? I mean, obviously that's really important and that can help so many people in Australia. But what about people right at the bottom? I mean, currently Youth Allowance is at $32 a day and Newstart is around $40 a day. Even the Liberal former Prime Minister John Howard says it's time to increase Newstart. The Business Council say it's time and these people aren't bleeding heart communists. Respected economist Chris Richardson said that the level at the moment is unnecessarily cruel. So why when we're giving tens of billions of tax cuts to big business, why can't we help those less fortunate?

TREASURER:

Ninety nine per cent of those who are on Newstart are also on other forms of benefits. So they don't just sit on that benefit alone.

TILLEY:

So that might take them to $50 a day.

TREASURER:

But the other point I was going to make on Youth Allowance, you make a good point. That's why we've increased the family income test for Youth Allowance. So if there's students who are coming from regional areas, rural areas, we've increased the Youth Allowance access for them, from where they're coming from. Both $10,000 up front on the income test, but on top of that, a further $10,000 for each individual child. So we understand that particularly rural and regional students do it a bit tougher than those in the cities and they can often not get access to Youth Allowance at all, and this will enable Youth Allowance to be provided to more of those students.

TILLEY:

You're listening to the Treasurer of your country, this is Scott Morrison speaking to you on Triple J. Last night he handed down the Budget. So that's good for those regional students, but what about people on Newstart today…

TREASURER:

Yes. Yes, it is.

TILLEY:

Surviving on $40 a day? Why not give them a bit more? I mean, Chris Richardson said to give them a $50 per week raise would cost $3 billion and compared to a $140 billion of personal tax cuts…

TREASURER:

That's $3 billion a year.

TILLEY:

Sure.

TREASURER:

That's $3 billion a year.

TILLEY:

Sure, I'm not saying that's an insignificant amount of money, but why can't we…

TREASURER:

It's a very significant amount of…

TILLEY:

Provide more for these people when we can find so much more for business and personal tax cuts?

TREASURER:

Well, what we're doing is finding them jobs. That's what we're doing. Over 1,000 jobs have been created over the past year. It's the strongest jobs growth we have seen on record, and thousands upon thousands of young people are getting those jobs. The Youth PaTH program that I announced in my first Budget, has seen 17,000 to 20,000 young Australians, young Australians who previously had been unemployed for more than six months, and they're now in work getting jobs. And you know what we did for their Newstart? When they went into that program, we actually upped their Newstart for when they're in that program. So they're actually, it's not phoney work for the dole, its real work for the dole. You are getting a bigger payment on Newstart and you're getting real life work experience working in an actual company, and then you're on a path to actually be on a wage subsidy with that employer, and then you're on a full wage, supported completely by the employer. So we're getting thousands and thousands of young people into work, and that's what our goal is. To get young people jobs.

TILLEY:

Ok, let's talk about housing affordability. There were no new major measures in this Budget to help people with housing affordability, and we've got some of the most unaffordable housing in the world. You know, this question really makes young people scared for their future. Have you forgotten about these people?

TREASURER:

Those measures were all in last year's Budget and that included the first home saver account…

TILLEY:

Sure, but that just helps to get a $30,000 deposit, a tax break to do that. I mean, is that all you're going to do?

TREASURER:

Well, on top of that the National Housing Finance and Investment Corporation starts on July 1 and that's paying low interest loans to develop affordable housing right across Australia. On top of that, we're providing direct social housing assistance to the States and Territories. Permanent funding for homelessness services all around the country, which used to be only done year by year. That continues to roll out. I mean, I did a Budget last year and the year before that…

TILLEY:

Sure.

TREASURER:

And there were measures in all of those and they keep going. They don't just stop. I mean, each year's Budget adds to what we're doing. But on the first home savers account, what people can do is instead of putting the money their saving for their first home in an ordinary bank account, which means you pay your marginal rate of tax on what you've earned once, and then you pay your marginal rate on what the interest is being earned in that account, what you can do is you can pull it out of your pre-tax income, you put it in your superannuation account, where you pay a concessional rate of tax, which means you can save for your own home, with your own money, 30 per cent faster. That sounds like a good plan, and people are taking it up…

TILLEY:

Yeah but it maxes out at $30,000. In Sydney and Melbourne, people are having to save, you know, over $100,000 for a deposit for their first home.

TREASURER:

I remember saving $30,000 and it wasn't easy. It wasn't easy then and it's not easy now.

TILLEY:

But that would have bought you a lot back in your day when you were buying your first home, but times have changed.

TREASURER:

Well, I understand that and, in fact, over the last 12 months what we've done through how we've controlled how the banks lend, what that has meant is we've seen a massive change in the growth in Sydney and Melbourne house prices. It was at up around 17, 18 per cent a year ago, and the interventions we've taken over the last 12 months has seen those house price increases fall. Well, in Sydney's case, actually to less than zero, and, in Melbourne's case, in the low single digits. So we're taking action on housing affordability there, we're taking action and giving people tax breaks for their first home savings, we're working with the State and Territory governments to increase the supply of housing, which at the end of the day is what makes housing cheaper.

TILLEY:

You're listening to Triple J's Hack program. I'm Tom Tilley, and you're listening there to Scott Morrison. He's the Treasurer of Australia, talking about the Budget. Alright, Minister, I've gotta keep moving. We're a lot of people asking about the $48 million for a Captain Cook commemoration. On Instagram, one of our listeners Tom Anderson asked, "What justifies spending $50 million towards commemorating the landing Captain James Cook?" And another listener points out that it is in your electorate. Treasurer, there are already monuments in a number of parts of Australia, you know in various states, do we really need to spend millions of dollars on another one?

TREASURER:

It's the 250th anniversary of the meeting of two cultures at Kurnell which is a significant moment in Australia's history. Now, the monument itself is $3 million. It's not $48 million, so you know, they should not believe some of the misinformation which is put out of there…

TILLEY:

Okay, there's education and other elements…

TREASURER:

The other money is spent on education facilities which are out there. It's there to support indigenous businesses as well. There's a very significant indigenous component to what's happening out at Kurnell, and particularly people who are part of the La Perouse area will stand significantly to benefit by building ferry wharfs, because it involves building a ferry wharf at La Perouse, and a ferry wharf on the Kurnell side, which means people can also use that for commuting into the city, as well as coming across from La Perouse. And that's going to create real business opportunities for local indigenous people. So, you know, people need to look past the headlines, and look past the Facebook postings and the Twitter postings. There's a real program going out there, which is benefitting indigenous people, and it's helping young people learn more about our country.

TILLEY:

Treasurer, in your speech last night, you called for an end to subsidies for renewable energy. You said, "All energy sources and technology should support themselves without taxpayer subsidies." And you also said a number of times that increasing our emissions targets beyond the targets your Government's set out will only drive electricity prices up. But that's not the only thing reducing emissions. It also reduces our impact on climate change. So do you care about the long-term impact of climate change or are you only interested in short-term electricity prices?

TREASURER:

Well, I think that's a pretty unkind way to put it with respect. We are backing in our 26 to 20, 28 per cent emissions reduction target, which puts us right in the middle of the pack with what the rest of the world is doing, and we've got to a point now with the renewable energy sector where it's been able to achieve a mass, and the technology can be done now at a cost which means it can stand on its own two feet. So, renewable tech energy, it will be a massive part of the future of Australia's energy supply. And it's going stronger and the technology is improving all the time. My simple point is this, it doesn't need government subsidies anymore. And so if you do that, all you do is push people's electricity bills up. So we're achieving the emissions reductions target. We're had a scheme that has boosted and supported the development of the renewable energy sector in Australia, and that will continue. I mean, a successful industry doesn't need subsidies to keep it going. It is a successful industry, and I've seen the investment that's going into the sector and that will continue.

TILLEY:

Scott Morrison great to have you on Triple J, the day after you released your Budget. Thanks so much for joining us.

TREASURER:

Thanks a lot, Tom. Good to be with you.