1 September 2017
Transcript - #2017169, 2017

Doorstop interview, Sydney

SUBJECTS: Launch of Citi's Pathways to Progress youth employment program; Youth Jobs PaTH program; excessive card surcharging ban extended to all businesses; activity in manufacturing industry at highest level since May 2002; Australia’s housing markets; Labor’s housing sledgehammer; cashless debit card; 240,000 jobs created last financial year; pick-up in non-mining investment; high business confidence; strong business conditions; strong job advertisement figures; Turnbull Government’s take-action-now approach to the banks.

TREASURER:

It’s good to be here today launching another corporate investment in getting young people into jobs. The Turnbull Government has our significant PaTH program that is also about getting young people into work and that program now has major supporters whether it is the retailers, the Hotels Association, Motor Traders and that program is going very strongly. Also, today, is the first day for the rest of the economy – smaller businesses – for our bans on excessive credit card and other card surcharging. That comes into effect today. The first tranche of that came in before the footy finals last year and now the second phase of it comes in before the finals again this year. This was another part of our response as a government to the Financial System Inquiry which put customers at the centre and customers at the centre shouldn’t be getting ripped off by excessive card surcharging and that is another delivered action by the Turnbull Government today.

We are also seeing some improved economic data again today in the manufacturing sector. The purchasing managers index – the best it has been for 15 years. And on top of that we are seeing our policies through the regulator having the intended effect on the housing market where we have seen some smoothing, particularly in Sydney. When you look at a set of numbers on housing markets and Hobart is topping the list for house price increases then you know that the measures that we have been putting in place to curb the upper end, particularly in places like Sydney, are having the desired effect. Using the scalpel not the sledge hammer of big taxing increases like getting rid of negative gearing and putting capital gains tax up by 50 per cent which is what the Labor party proposed.

QUESTION:

Treasurer, just on youth unemployment, obviously we have seen a couple of fluctuations over the last year but generally above that 12 per cent number. What do you think is really required now to bring that down more in line with unemployment more generally?

TREASURER:

The programs we are putting in place. The Youth PaTH program is designed to get young people, particularly who have struggled to get into work, longer term unemployed but equally it is about growing your economy and seeing jobs come into the economy. We have seen 240,000 jobs come into the economy over the last fiscal year and in the last six months we have had the strongest full time jobs growth in the last 40 years. So, we are seeing the economy grow. We are seeing improved signs coming through, particularly most recently, and that will flow into jobs as we are seeing and it will ultimately flow into wages. We are also seeing investment. We have seen the best non-mining investment figures now for some time, particularly looking out for next year. So, we have been looking for these sorts of changes as a result of the policies that we have been putting in and it is good to see that those better days ahead are just starting to emerge.

QUESTION:

With the ban that came in today with those excessive surcharges for credit cards – what sort of impact do you think that will have on the community? Will it be noticeable for the everyday person going to grab their coffee?

TREASURER:

I would hope that they would be noticing. The question goes to what should customers be looking for. If you are going in and you are paying for things and people are charging you credit card surcharges of above three per cent or even for other cards above 1.5 per cent, you should be getting on to the hotline number [1300 302 502] and reporting this sort of thing. Small businesses and medium size businesses have been on notice now for the last year that it would be coming in today. It comes in today. So, if you see excessive credit card surcharging then get onto the hotline and report it.

QUESTION:

And for people who might not be so savvy about the percentages, is it just a sense that they have a gut feel that it is too much then it probably is?

TREASURER:

Well, if they feel they are getting ripped off on credit card surcharging ring the hotline. That is what is important. Different cards charge different things to small businesses. You have some cards which can charge the small businesses up to 3 per cent. That is what they will see on the bill. Others will only be charging about 1 and 1.5 per cent and they should be charging and passing on no more than that. There can’t be any clipping the ticket on credit card fees.

QUESTION:

On another card related note, of course we had the report out today on the cashless cards. Wondering if you would welcome a move to extend that to more suburban areas as well?

TREASURER:

I think it pays on results this program and we’ve seen the results in the communities it’s already been introduced to and one of the key things behind the success of the program is the strong community support where we put it in. Where it’s going into Kalgoorlie at the moment, the strong support of the mayor there who was basically encouraging the Government to bring this program into his community. So where it’s got that good strong support, that’s where we see it has most effect and so we look forward to it having the same success in Kalgoorlie as well as in other places. But we’re introducing the drugs trial programs, we’re doing that in suburban Sydney, it’s being done in Canterbury, it’s being done in suburban Queensland in Logan. So these are places where we’re putting these types of programs in place and they’re trials and where they get results, we’ll keep doing them. If they don’t work, well, we won’t.

QUESTION:

On the manufacturing data that looked quite promising, with a bit of discussion as well about the high cost of energy and how that might be influencing this sector, what do you think has sparked that big data?

TREASURER:

We’ve got business conditions surveyed now which show it at the best levels we’ve seen since before the Global Financial Crisis. Similarly, we’ve got business confidence surveys showing business confidence is at its best level since about 2010. Now, we’re seeing that flow into people employing people. We’re seeing that in job ads like the ANZ job ads survey which is at its peak at 177,000 ads. So, people are seeing, whether it’s the global economy or domestically, they’re seeing things start to change and businesses have been seeing that now for some months and that’s been flowing through into their investment plans and their outlook. We said in the Budget that there would be better days ahead – that wasn’t a slogan, that is something that has now become the emerging economic consensus and so we need to continue to lean forward into that and grow.

QUESTION:

What do you make of Labor’s CBA accusations? Is it getting to a point to [inaudible] Ian Narev to step down?

TREASURER:

The role of the chief executive of CommBank – managing director – is a matter for the chair of that bank, Catherine Livingstone, and they’re accountable for what happens in the Commonwealth Bank. APRA have announced a very wide ranged inquiry into CommBank and soon APRA will be announcing who will be undertaking that review and it’s more specific tasking, and it will be their job to get under the covers on this and have a good, strong and hard look at it and take whatever action is necessary. So, these are other further serious matters that have been raised. I note that the Commonwealth Bank has made a statement today putting what was reported yesterday into some context but still, if there are questions there that need to be addressed, they will be.

QUESTION:

Does this not bring about the prospect of a banking Royal Commission?

TREASURER:

There’s an inquiry taking action now. The Government is taking action now on the banks. Others want to delay taking action for years through a Royal Commission. You need to take action now. That’s what the Government is doing – whether it’s our new executive accountability regime which I’ll be introducing into the Parliament next month, whether it’s our new Financial Complaints Authority that will give customers of banks a more ready opportunity where things go wrong, they can have their cases heard, resolved and get binding settlements out of that process of having their matters heard. We’ve increased the resources of ASIC, we’ve increased their powers, APRA is opening up our banking system to more competition. So, the Turnbull Government is taking action now on the banks. APRA is taking action now on the Commonwealth Bank.

Thank you.