18 May 2017
Transcript - #2017111, 2017

Joint doorstop interview, Brisbane

SUBJECTS: Budget 2017

LUKE HOWARTH (MEMBER FOR PETRIE):

The only Government, the only Party with a plan for jobs in this nation and that’s the number one issue that people talk to me about here in Petrie, Treasurer. They say, “We need somewhere to go on a Monday morning. We need work to pay and raise our family which is really exciting.” The infrastructure here with the Bruce Highway and the Deception Bay Road overpass behind me is very significant, you’ll see it’s a very small two lane overpass. People trying to get to school, businesses trying to get to work. The Federal Government is investing in this overpass, it will be a new six lane overpass, four lanes each way and two turning lanes. As well, we’re boosting the Bruce Highway, the Bruce Highway will be six lanes – not just to Caboolture like it is at the moment – but all the way to Caloundra. And Moreton Bay region is the fastest growing region in Australia, big population soon to overpass Tasmania. So Treasurer, thank you for coming up and I’ll hand over to you to say a few words.

TREASURER:

Thanks very much, Luke, and thanks for the welcome to be here. Our Budget is investing in growing the economy for more and better paid jobs. This is one of the fastest growing areas of the country and spending $120 million on upgrading the overpass just behind us to effectively six lanes and $530 million on the Pines River to Caloundra section, which is boosting the Bruce as Luke has said, and on top of that further funding all the way up dealing with flood mitigation and other works, this is the infrastructure we need to invest in to grow our economy to support more and better paid jobs. It’s this investment and the careful financial management of the Government which has ensured that we have maintained our AAA credit rating from all the three key international ratings agencies. Now, this is something that six months ago all the pundits said wouldn’t be achieved, once again the Government is in a position where we have maintained our AAA credit rating for all of those three key agencies. Now, that’s good news for all Australians, it’s also good news for the major banks, a ten basis point cut, funding cost is what they estimated is if the AAA credit rating was lost for them. So they have had a ten basis point support today by ensuring that the AAA credit rating has been maintained by all three ratings agencies. So we are investing in our infrastructure, right across the country but right here in Queensland on the projects that make a very, very big difference. And just behind you the Arethusa school, they will have an 80 per cent increase in funding per student over the next ten years, public schools here like Bracken Ridge a 60 per cent increase in their funding over the next ten years. So whether it’s investing in schools, investing in infrastructure, guaranteeing Medicare, supporting the National Disability Insurance Scheme and $120 million for the overpass here at Deception Bay, these are the investments that will grow our economy and make Australia stronger.

QUESTION:

Treasurer, why have the banks had to sign a confidentiality agreement before they can see the draft legislation on the $6.2 billion levy?

TREASURER:

Well, it’s not an irregular practice, we did this recently on a series of legislation, the multinational avoidance legislation, we did it on the diverted profits tax, these are sensitive matters and we’re working with the banks closely on these issues and we’re respecting their confidentiality too. Not all the banks have the same position on this, we’re not about to go and tell tales out of school about what the various arguments and positions and recommendations each of the individual banks are putting forward, we’re listening to that and we’re finalising that legislation, it will be introduced in the next sitting fortnight of the Parliament, absolutely on schedule. It’s also a practice that was used by the former Labor Government on corporate integrity measures and things like that. So it’s not an irregular measure, it’ll ensure that we’re able to work through the issues that we have, which are very minimal and the legislation will be introduced on time.

QUESTION:

[inaudible]

TREASURER:

Yes.

QUESTION:

Have you been or were you notified that the son of Michael Cranston, the Deputy Commissioner of the ATO, has been arrested on tax fraud charges [inaudible]?

TREASURER:

This is a major Government crackdown and what the events today with this major fraud bust today demonstrates is that if you’re a crook and you’re seeking to defraud the taxpayer, we’ll find you and we’ll track you down and we’ll make sure that you’re brought to justice. And what this is showing is that the system works when it comes to tracking down tax cheats. We have got a major black economy taskforce, which we’re acting on the recommendations from, we’re acting and giving further resources to the ATO and others to crack down on serious organised crime, the Minister for Justice will be making further statements today on this matter. But what it demonstrates is, that this is a Government committed to enforcing our tax laws and those who think they can take and defraud Australian taxpayers, today’s events show that they have another thing coming. We will catch the crooks, we will bring them to justice, and we will keep catching those crooks.

QUESTION:

Have you spoken to Michael Cranston about it?

TREASURER:

No, that’s a matter for the ATO, and I’ll leave those matters to what happens internally within the ATO. But what it does show is the system works. The system works to catch the cheats.

QUESTION:

What can be done to improve the relationship between Queensland and the Commonwealth Government regarding project funding?

TREASURER:

Queensland’s just got to come to the table. On this project here, it’s an 80/20 funding split, so they need to come to the table and bring their 20 per cent. They need to stop politicking with the Commonwealth Government and start working with the Commonwealth Government, bringing forward practical proposals, proven business cases for projects and we’re happy to work with those state governments. We just demonstrated in Western Australia, a Labor Government that has only just been elected, we were able to recommit $1.6 billion worth of infrastructure to projects in Western Australia and agree that in a practical way in a matter of weeks, but we find in Queensland we’ve got a Premier who’s too busy throwing stones and carrying on with the Commonwealth Government rather than just doing what I think all citizens of Queensland, all taxpayers in Queensland would like them to do, is just to sit down and work with us.

QUESTION:

Last week the Deputy Premier criticised you for not coming to Queensland, do you have a response?

TREASURER:

I’m here.

HOWARTH:

Well, he’s here now.

TREASURER:

I’m in Queensland fairly regularly and, for the last three or four months, I’ve been busy working on the Budget which is delivering for Queensland.

QUESTION:

When was the last time you were in Queensland?

TREASURER:

It was late last year I think it was. That’s the process for the Budget, once you’ve locked down for the Budget, you’re in your office, you’re working away, you’re putting the Budget together, you’re listening to people like Luke.

HOWARTH:

If the Deputy Premier wants to talk about infrastructure, she should get up here to Deception Bay and throw in 20 per cent for this overpass, throw in 20 per cent for the Bruce Highway that every person in North Brisbane will benefit from as they commute that way. But all we see from the State Government is whinging, they don’t do anything for this area, they need to invest in this area. Stop putting your hand out and take some responsibility is the message to the State Government.

TREASURER:

The other invitation I’ll give to the Queensland State Government is this, we’ve put $300 million in the Budget for the next two years to invite the Queensland Government to cut red tape for small business, now where they cut that red tape for small business, they’ll get bonus payments from the Commonwealth Government which means they can invest in the priorities that they’ve identified. But so far they’ve refused to even sign up to an agreement where they could get reward payments for reducing the cost of regulation. And so there’s an offer there, there’s money on the table, sign up, cut red tape for small business and Queensland will be the beneficiary, not just in an additional payment to Queensland, but the small businesses that employ people in Queensland will benefit from having less red tape.

QUESTION:

You’re here in Brisbane selling the Budget and things that are for us here in South East Queensland but what about regional Queensland? There’s been a lot of criticism that there was nothing in the Budget for regional parts of Queensland.

TREASURER:

Well, the Prime Minister is on his way to North Queensland today and he’ll be making further announcements there. One program up in North Queensland which he’s reinforcing today is the expansion of the ParentsNext program. This is a really important program for young mums who find themselves having children very young and face the risk of living a life on welfare. And this is a program which we’re expanding to 20 locations, many of them in North Queensland, which is giving them access to childcare support, to education, to employment services and a whole range of other supports that helps get them to a position where they could be self-supporting in the future. On top of that we’ve got the infrastructure works, we’ve got in place our naval ship building program which also supports North Queensland, there’s a raft of measures there which I know the Prime Minister will be working through with our members up there today, as well as Darren Chester who is in Queensland as well I understand at the moment announcing those major infrastructure works. But right here, this is where the around $850 million of investment in the Bruce Highway, boosting the Bruce starts and on top of that, that’s a program of over $6 billion for the Bruce Highway that this Government has been delivering.

QUESTION:

The Prime Minister looks set to announce, what you’ve mentioned to announce before, what else can the Government do besides these measures to be announced today to stop kids having kids?

TREASURER:

Well, I don’t have a problem with families, I think it’s good, I think one of the greatest blessings you have in life is to have children and it’s certainly been the greatest blessing in my life other than my marriage. So, these are tremendous things to be able to have kids. Where young people find themselves having kids early though, they can get themselves into a bit of stress and a bit of hardship and sometimes these things aren’t planned – that’s the nature of life. But what we have to do is when young people find themselves in that situation, particularly young mums who are single, which is what this program really helps, then we put those supports in there to make sure that – I know they love their kids and they want the best for their kids, we also want the best for them and that’s what this program’s about.

QUESTION:

On that program, you’ve announced 20 locations here, you refer to regions like mid coast of New South Wales, is that every town in that region or just one place in that region? Or how does it…

TREASURER:

Well, I’ll let the Minister go into more detail but I mean where we’re concentrating the program is in areas where we know there is a high client need in those places. So within those regions the services actually know where there are additional people who need the help so we’re targeting them into the locations where they need the help. We’re also targeting particularly into locations where there also happens to be a high indigenous population, because we know that’s a real issue for in indigenous communities. So this is another example of a program that we’ve been running which is working so we’ve decided to expand it. We’ve done the same thing with the cashless debit card, we’ve taken it into communities where it’s been welcomed in those communities and it’s been working so we’re expanding it. We’re a Government that tries new things and where it works we put more into it because we know it’s getting results – where it doesn’t, we’ll try something different. For example, $14.7 billion has been blocked in the Senate of savings that we knew would improve the budget. We’ve had to address that in this Budget and we have, and we’ve retained the AAA credit rating, maintained that credit rating from all three agencies despite the Senate, despite the Labor Party and what we’re going forward is for lower taxes for companies and we want lower taxes for individuals. The Labor Party wants you if you do well in life to spend one day working for the Government and one day working for yourself, that’s not fair. They want to increase the Medicare levy but they don’t want to put a cent of it into funding the National Disability Insurance Scheme, Chris Bowen made this crystal clear. Don’t be hoaxed by the Labor Party, they don’t want to increase the Medicare levy to support the National Disability Insurance Scheme they just want to increase the tax. Every cent, every cent of the increase in the Medicare levy two years from now when the bills start coming in for the NDIS, will go to funding and fully funding the NDIS, that’s what we’re committed to – Labor just wants to raise taxes for the sake of it.

QUESTION:

The ACCC has said that it’s going to be watching the big banks to make sure they don’t pass on the bank levy to customers, does it have the power to do that?

TREASURER:

The ACCC have wide ranging powers but I have this invitation for the banks today, when it comes to their threats against the Australian community about passing on a six basis point levy. The first bank to say to Australians that they’re not going to pass this on I suspect will get great support from the Australian people and I challenge the banks to do that. They can wear this cost, the UK banks have already worn a similar cost because they understood they had to do the right thing by their customers. And if the banks actually really want to prove something to the Australian people that the perceptions that many have about them is not true, the first bank to break ranks and say, “No, we’re not going to insult the Australian people, we’re going to do the right thing by the Australian people.” Then I think they will get a lot of support from Australian customers and if the other banks don’t want to follow them, then I’d be following the bank that is the first to move.

QUESTION:

But the banks are in the business of making money?

TREASURER:

The banks are in the business of serving their customers and the best way to build your shareholder value is to support your customers and provide good service and that’s what the banks need to do.

QUESTION:

Do you think Anna Bligh is doing a good job with the ABA?

TREASURER:

Well, Anna Bligh doesn’t work for me. She works for the big banks but she also works for the smaller banks who don’t seem to be getting a voice through the ABA at the moment. The regional banks like Bank of Queensland and all of these...

HOWARTH:

That’s right, people can switch, Treasurer. If people aren’t happy with the big banks – we want banks to make a profit, that’s good and they’ve done a good job and we thank them for employing people – but the fact is if they want to whack up prices, up here you’ve got the Bank of Queensland, you’ve got the Bendigo Bank, you’ve got Suncorp-Metway. And I say to everyone watching this program, change your bank, get rid of them. If they don’t want to play ball and they up your prices, cut them off. But as the Treasurer said, the first bank to say that they’re not going to pass it on I think you’ll find – I mean, I just changed banks last week from ANZ to Westpac with the big banks, but I tell you if they pass it on I’ll change again and that’s the message to all Australians.

QUESTION:

And you can’t rule out the levy won’t increase in the future?

TREASURER:

Well, we have absolutely no plans to change the levy. We’ve set the levy at the level which we think’s fair, we’ve set it at a level where we think the banks can absolutely absorb that. I mean the Reserve Bank moves the cash rate by 25 basis points at a time and what we’ve seen over the last few years is the banks have been increasing their spread on mortgage rates and the cash rate, so they’ve actually been increasing how much they’re taking. I wish the banks were as quick to pass on the benefits to customers as they seem to be wanting to pass on the costs. I mean, what we’ve seen just overnight with the maintenance of the AAA credit rating, NAB themselves have said only just before the Budget that a loss of the AAA credit rating would have meant a ten basis point cost to the banks. Now, I bet you they would have passed that on in a heartbeat, but the fact that we have been able to retain the AAA credit rating, I think that has saved the banks that ten basis points. Interestingly, the National Australia Bank said that ten basis points didn’t mean that much, when it’s the cost of funding doesn’t mean that much, but if it’s a levy it’s the end of the financial system as we know it. So I think the banks are having a lend of people on this issue – they really are – and they should frankly have a good hard think about this. The first major bank to say that they’re not going to confirm the Australians worst impressions of them I think will do the banks a favour and will show the leadership which the other three should then follow. Thanks very much.