7 September 2016
Transcript - #2016121, 2016

Interview with Tom Connell, Sky News

SUBJECTS: Agricultural Land Register; foreign investments; Senator Dastyari

TOM CONNELL:

Treasurer, thanks for your time this morning. The purpose of this, is it going to be updated regularly? Labor’s saying that they want to be able to have a click of a button and you can see who owns what. Is that the ultimate goal?

TREASURER:

Well, no, that was never the promise. What we said is we’d provide a clear picture about what the foreign ownership of the agricultural land in Australia is. And as you said, it’s exactly that. Chinese ownership of agricultural land is less than one half of one per cent of our agricultural land. Almost two thirds of our agricultural land that is owned by foreigners is owned by the Brits and the Americans. But 85 per cent of it, more than 85 per cent of our agricultural land, is owned by Australians. So we have a positive foreign investment programme, but it’s done only in the national interest. There are cases like the Kidman sale where I’ve said no but there are many other occasions where we’ve said yes and it’s been considered to be consistent with investing in our agricultural production capacity. In a lot of these transactions, we’re seeing hundreds of millions of dollars being poured into new equipment, new technologies, new processing plants, new crops – all of these sorts of things and that’s supporting jobs in rural and regional Australia.

CONNELL:

The fact that this number is relatively low, perhaps compared to some of the memes that you see on the internet so far as an example, does that show that bringing this threshold down to 250 million to 15 million in which the investment is looked at, was that a bit of a knee jerk reaction?

TREASURER:

No, I don’t think so. All that simply does is it makes sure that we’re reserving our right to say yes or no on a transaction. Now, the majority of those we obviously say yes to. But there’s nothing wrong with Australia exercising its sovereign right to decide whether there can be agricultural land sold to foreign interests. Where it happens it must be in the national interest and certainly not against the national interest – which is the actual test under the Act – and we exercise that. But on each of these transactions, I’ve now applied a new set of tax conditions in all of these cases. One of the concerns about foreign investment in agricultural land, in particular, was issues of profit shifting and transfer pricing and things like that – particularly in some of the export arrangements. Now, what I did some time ago was put a condition on those I approved so that they sign a tax deed which says if they violate any of those provisions which we’ve now got in our Multinational Anti-Avoidance Laws and, of course, there’s the Diverted Profit Tax Laws coming, not only do they face the punishment of that but I can force a divestment of the entire property or business.

CONNELL:

Where does this list go from here? Do you update it and is there going to be some sort of a figure where if Australian ownership drops below there’s going to be a concern? Because you’ve got this figure now – what if it gets below 50 per cent in future years?

TREASURER:

This is simply an exercise in information. That’s what it is. It’s a transparency of information so people can understand what the lay of the land is when it comes to foreign investment. It will be updated and that’s its purpose. We appreciate the work we’ve been able to do with the states and territories to make this possible. It was a commitment we made some time ago. We’re following through on that commitment. It enables us to have an informed debate about what the true state of foreign investment is. Foreign investment has been part of this country ever since Captain Cook turned up pretty much. It’s been an important part of our development. It’s been an important part of our prosperity story. Now, it must be in our national interest and that’s why we have those very tight review thresholds and controls that we imposed.

CONNELL:

These updates, though… You have regular updates and as I said, is there a certain percentage point in which you’d review it where you’d consider putting something in where you’d say we need a minimum of Australian owned agricultural land?

TREASURER:

Well, that’s not its purpose –

CONNELL:

I know it’s not its purpose but –

TREASURER:

If I could just answer the question. The purpose is to ensure we have a clear understanding of where things are and we now have that and I think that significantly improves the situation and informs the quality of the debate we have about these issues. But we’re sitting at over 85 per cent and the majority of that foreign ownership as I’ve said, two thirds of it pretty much, is in British and American hands. The other thing I note is even the transactions that are coming through now – yes, there has been more recent interest from Chinese investors in Australian businesses as well as in agricultural land and other assets – but even after that, in the most recent year we had figures in 2015, China was still well down the list. The big names on the list, the largest agricultural land sale that I’ve approved was actually to Dutch and Canadians. That dwarfs any of the other sales that have been talked about as being approved – with the exception of Kidman, of course, but that was the one I rejected and knocked back.

CONNELL:

So for those concerned about foreign investment, what would you say? You’re not setting a minimum but you’re keeping an eye on where this goes, basically, and where the figures are headed?

TREASURER:

We have a clear view now about the key issue which is: how much of our agricultural land is owned by foreign interest and which foreign interests? I think that informs the quality of decision-making, it informs the quality of policy-making in this area and it informs, hopefully, the quality of debate around these issues. And it helps us to make the case because around the world today, and there are elements of this here in Australia, there is a longing to perhaps – as the Prime Minister and I say – to pull the head under the doona on these things and try and not address these issues. No, we need to address these issues. Foreign investment is an important part of our economic plan. It’s an important part of our prosperity over generations and we want that to continue, but it must be on our terms.

CONNELL:

Ok. Sam Dastyari held a news conference – I think it was about 22 minutes or so. He apologised. He said what he did was wrong, albeit totally above board in terms of declaring it. He said he agrees with Labor and the Government’s position on the South China Sea. What’s there left for him to say?

TREASURER:

“I resign” is what he should say. That’s what he has to say. And he won’t say that. So Bill Shorten must order his walk to the pavilion on this issue. The facts aren’t in dispute, Tom. The facts he has confirmed. He got on the phone personally, rang a donor – and it happened to be a foreign donor with links to the Chinese Government – and asked for him to clear off one of his debts. Now, that is an extraordinary situation. This isn’t about foreign donations. This is about the third most senior person in the Labor party in the Senate getting on the phone to a foreign donor and saying: “I’ve got this debt. Can you clear it for me?” Now, he must have had quite a level of expectation as a result of the relationship he has with this individual to presume he would have said yes. I assume it was the first person he called. I don’t know how many others he called before that. So that is the issue before Senator Dastyari and, more importantly, before Bill Shorten. They just want to sweep this under the carpet, divert attention and say: “We need to look at foreign donation laws.” That’s Labor’s classic trick. What they have to face up to is that ‘Shanghai Sam’ got on the phone to a donor and said: “Will you clear my debt?” Now, that’s not the first time he’s done it. But it’s the first time he’s admitted it.

CONNELL:

Well, it’s always been on the public record to be fair…

TREASURER:

But I don’t remember a 22 minute press conference over that issue. And I don’t remember a 22 minute press conference at the time when he made sure the Labor party paid for Craig Thomson’s legal debt.

CONNELL:

So the Yuhu Group that paid $40,000 towards Sam Dastyari’s legal debts has also donated three quarters of a million dollars towards Liberal Party branches since 2012.

TREASURER:

No one got on the phone and asked this bloke to clear their debts other than Shanghai Sam.

CONNELL:

Did anyone get on the phone and say you should donate to Liberal Party branches?

TREASURER:

It’s not the same thing, Tom. And you’re conflating two completely different issues. Even if he had done this to a domestic donor and said: “I’ve got this problem with my debts. Can you clear my debts?” He may as well have gone down and punched into his own ATM. This is the problem for Bill Shorten and the Labor party. They don’t understand the difference between donations made in an ordinary course of political donations consistent with the Act – and if we need to look at that, that’s a separate issue – and what Senator Dastyari, the third most senior ranking Labor party member in the Senate, did…

CONNELL:

Ok, you’ve mentioned that. What about three quarters of a million dollars from the Yuhu Group towards the Liberal Party branches since 2012? Did anyone ring up and solicit those donations to go to the Party?

TREASURER:

None of those donations were about clearing any individual member’s debts.

CONNELL:

But it’s still towards a Party and this is a significant amount of money.

TREASURER:

But Tom, they are all disclosed donations according to the law. You’re misunderstanding the point and I don’t understand why you’re misunderstanding the point. It’s for this reason, he rang up a donor for whom he’d have to have an intense relationship to actually secure the payment of his own personal debt. That is extraordinary.

CONNELL:

Ok, if I can take the issue broad for a moment. Foreign political donations –

TREASURER:

No, the issue is not broad –

CONNELL:

Can I ask you broadly though –

TREASURER:

The issue is not broad. The point is about Senator Dastyari having a debt cleared by a donor. That is the point. That is why he should go. And that’s why he should walk. And why is Bill Shorten tolerating such a low bar for Senator Dastyari? That’s the question. Bill Shorten continues to fail this test every single day. If he can’t see the difference between what Senator Dastyari has done and the more general issue of foreign donations, then Bill Shorten is clueless on this topic and that is a real concern because he doesn’t know where the line is.

CONNELL:

But on political foreign donations and call it a segue, say it’s different, call it what you like, what is the case that foreign political donations are in Australia’s national interest?

TREASURER:

I’m happy for that to be looked at by JSCEM. I’ve got no problem with that being looked at by JSCEM. But that is not the issue around Sam Dastyari.

CONNELL:

Right, but on foreign political donations, what do you think the case is –

TREASURER:

I’m happy for the Joint Standing Committee on Electoral Matters to review that and make recommendations and to consider their recommendations with an open mind. But that is not the problem here.

CONNELL:

Are you one to go in to bat for foreign political donations?

TREASURER:

We have a Special Minister of State who looks after these matters and I’m sure Senator Ryan is more than capable of working through those issues. What Bill Shorten is not capable though is taking action on his third most senior ranking member of the Senate who has got on the phone and personally asked for a donor – in this case, it turns out to be a donor with links to the Chinese Government – and asked him to clear a debt and then we have these unexplained, unremembered statements on variance of his own personal advocacy on the issue of China both not just over China, but his vigorous prosecution of the Secretary of the Department of Foreign Affairs and Secretary of Defence and others seeking to push that case. And they’re facts that he’s still yet to confirm but the fact is that he got on the blower and asked his mate to clear his debt – that might be how you do it in the New South Wales Labor party. It certainly seems that way based on my experience of the New South Wales Labor party. This bloke’s got form.

CONNELL:

Look, these questions were put to Sam Dastyari, and I’m sure they will be again. But on that donation, you say he got on the phone, how is that not analogous to perhaps someone within your Party, perhaps a Minister talking to someone within the Yuhu Group about that $750,000 in-total donation? I mean people get on the phone and ask for donations. Isn’t that how it works?

TREASURER:

Well, there’s never been and nor should there ever be any expectation on the part of any donor, whether they’re foreign or otherwise, on any political party. What I’m puzzled and troubled about with Senator Dastyari is that he had a high level of presumption on this donor. You wouldn’t get on the phone and just cold call someone and say: “Look, I’ve got fifteen hundred bucks outstanding on a debt. Can you clear it for me?” You would only ring someone whom you knew very, very well and who you thought was going to say yes. And Senator Dastyari – Shanghai Sam – knew that when he got on the blower to this bloke that he was going to cash in.

CONNELL:

Now, just quickly, you have some regular donors that you could call up – couldn’t you – in your electorate?

TREASURER:

I don’t ask for donors to clear my personal debt.

CONNELL:

No, but there are people you could call up –

TREASURER:

No, they’re not analogous. They’re not analogous.

CONNELL:

Ok, so the debt compared to the campaign…

TREASURER:

He got on the blower and asked for this guy to clear his debt and now he has unexplained variances in his own behaviour on the sensitive matter of foreign policy on China on the public record which he can’t explain. Now, Bill Shorten may want to throw that under the carpet and say: “It doesn’t really matter.” I think in doing that he has shown himself to be someone who sets a very low bar. Now, the Prime Minister has taken tough decisions on his own team in relation to these matters – people who have been subsequently cleared by the Australian Federal Police and things of that matter. Now, these are different issues but the Prime Minister has always been showing the gumption to confront those on his own side when it comes to these matters. Bill Shorten has got zero for zero on this.

CONNELL:

Ok, we’ve got our points across there. We’re right out of time, Scott Morrison. Thanks for your time this morning, Treasurer.

TREASURER:

Thanks, Tom.