Breaking Politics - 16 June

At the start of the last fortnight of parliamentary sittings before the new Senate is installed, the focus of discussions on Breaking Politics today was naturally on the fate of budget measures. Here's the transcript.


MONDAY, 16 JUNE 2014

SUBJECT / S: Federal Budget negotiations; Superannuation; PPL

CHRIS HAMMER, PRESENTER: We're joined now in the studio by Andrew Leigh, the Shadow Assistant Treasurer and Labor Member for Fraser in the ACT and Andrew Laming, the Member for Bowman in Queensland. Andrew Laming, do you accept that the Budget now is unlikely to make its targets?




ANDREW LAMING, MEMBER FOR BOWMAN: The Budget can certainly make its targets if it's passed by the Senate, and Australians will know that getting things passed in the Senate is truly one of the great challenges in politics. So it's going to be a high bar, but it's doable.

HAMMER: But you can't get things passed by the Senate unless you introduce legislation. Where's the legislation?

LAMING: Well there's plenty of legislation in front of the Senate. The question is how much will be passed, particularly if there's question marks around support from the minor parties. So, the job of government is to get that over the line.

HAMMER: But there's something like fifteen measures that are scheduled to start on July 1st, a couple of weeks time, and the legislation still hasn't been introduced, so whatever you say about the minor parties –


HAMMER: You can't blame them for not taking a position if they haven't seen the legislation.

LAMING: Well first, there's plenty of work for the Senate to do, and second, there's still plenty of time between now and June 30.

Obviously that window between Budget and June 30 is a limited one, precious time's got to be used well.

HAMMER: Okay, Andrew Leigh, is Labor simply going to play hardball on the Budget to try and be as destructive as possible?

ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Chris, we won't block the Budget, we're not going to do a 1975 –

HAMMER: The appropriation bills, all these other contentious others, like Medicare co-payments, deficit levies, changes to family welfare, etcetera, fuel indexation, none of those are in the appropriation bills. What about those issues?

LEIGH: We'll argue those based on our values. On the additional levy for high-income earners, we've supported that, and that's passed the House of Representatives. Labor will support that in the Senate. On other issues, we'll bring our values to bear on them. So, if you're talking about measures that break promises by taking away income support for vulnerable young people, then that's the kind of measure we're not inclined to support. If you're talking about something that breaks a promise by cutting the pension for older Australians, we're not inclined to support that. So we won't be a rubber stamp for government measures that break their election promises and hurt the most vulnerable Australians, but we'll be as constructive as we can. Because the role of opposition is not simply to oppose. 

HAMMER: Now you're the Shadow Assistant Treasurer, so you've got a pretty good idea where the numbers are falling. On what you know of the government's policies, and what you know of Labor's position, what sort of hole do you think there is in the Budget?

LEIGH: The biggest hole that gets blown in the Budget, Chris, is the repeal of the carbon price. That costs the budget between $12 and $20 billion dollars over the forward estimates, approximately –

HAMMER: So you won't support that?

LEIGH: We certainly won't support the repeal of the carbon price. And in doing so, that adds as much to the budget bottom line as all of the rest of the things that the government has been complaining about. Chris, the reason that this budget –

HAMMER: But tell me, the Budget as it stands, with all of these measures that Joe Hockey has put forward, if Labor opposes what it says it's going to oppose, what is happening to the Budget?

LEIGH: We're said there's a number of things that we will oppose, but the important point that I'm making to you Chris is that the reason this budget increases the deficit relative to the Pre-Election Economic and Fiscal Outlook is because it loses so much revenue on things like repealing the carbon price, going soft on multinational profit shifting, giving money back to people with more than $2 million dollars in their super balance. Once you've done all of that, then even Joe Hockey's savage attacks on the Australian welfare state still take you back to a worse position than the books were in when the government took office.

HAMMER: Andrew Laming, the Treasurer has been critical of the welfare state, the so-called "age of entitlement", but there's new research out today that indicates that Australia's reliance on welfare payments has actually fallen in the last decade, so doesn't that kind of pop his rhetoric?

LAMING: Well it's a sample, Chris, and obviously if we were only paying welfare for a sample we'd be okay. 

HAMMER: It's a sample of about twelve thousand people. It's a longitudinal study. It's a pretty respectable study.

LAMING: We're paying welfare for nearly three million people, over a million families, and what we're seeing there is that some of them may well be accumulating superannuation and reducing reliance on welfare, for instance, simply because they're part pensioners and not pensioners, but in reality we know that in the youth unemployed area like most OECD countries, we have large and expanding numbers. We have growth way beyond simple CPI rates for most areas of our welfare. So, welcome findings from HILDA, but in the end there we’re responsible for the Budget bottom line. 

HAMMER: Talking superannuation, some of your National Party colleagues and have suggested that people should go out and spend their super, and then, of course, they can always fall back on the pension. Is that an area that a government - any government - needs to revisit?

LAMING: Well sure, Andrew would agree that in effect that's irrational behaviour, and I don't get to meet anyone who does that but I'm sure there might be one person exists that does.

HAMMER: Sounds pretty rational to me.

LAMING: Well, not really. If you want to accept life on a potentially lower income for a period that's indeterminate in length, I'm yet to meet someone that says to me that's a great idea.

HAMMER: So it's not a problem.

LAMING: I haven't met anyone who's doing it, if you'd like to show me someone, I'd like to meet them.

HAMMER: Andrew Leigh, is this an area where there needs to be bipartisan reconsideration of the present system?

LEIGH: Certainly on superannuation, Chris, we need to take account of the fact that superannuation tax concessions will soon exceed the value of the pension. And that was one of the reasons why we said that, for people getting a bigger superannuation tax concession than the value of the pension, they ought to pay a little more tax. That was one of the measures that the government didn't proceed with, one of the measures I mentioned before.

Just to go to one thing Andrew said before, though, I find it in passing strange that he doesn't trust research based on samples, because that of course means that we can't trust the unemployment numbers, because they're based on a sample. Probably we can't even trust the growth figures because the national accounts are often based on partial data. It's a worrying road once we begin going down there. 

What we got from Joe Hockey last week in his Sydney Institute speech was the suggestion that half of all Australians were leaners. That people like my grandfather, who left school at age 14, worked as a boilermaker, and is now a retiree is a 'leaner'. That people who care for kids with disabilities are 'leaners'. That a single mum who walks out of an abusive relationship, taking a child with her, is a 'leaner', because she receives some government support. It's an outrageous suggestion - I'd challenge Joe Hockey to name me ten people in Australia he thinks are leaners, or withdraw his libel on the Australian people. 

HAMMER: Okay, well can I show you a photo here, I think we've got, of you in the House holding up a book. This is because you are under consistent - well, not attack - praise from the government - perhaps a more fearsome –

LEIGH: Yes, it's worse really, isn't it.

HAMMER: Because in the past you've supported many of the measures the government's trying to introduce, including deregulation in universities and Medicare co-payments. How can you, as Shadow Assistant Treasurer, now be attacking those very measures?

LEIGH: Well Chris, it's always pleasing to have people citing your work in the Parliament. But let's face it, if the government had strong arguments for the policies they're pursuing, they'd be talking about what they said while running for election, rather than what I said while I was at university. 

LAMING: Is it true there's been a spike in sales though of the last month, Andrew?

LEIGH: Wouldn't it be good to know, Andrew. It's true I've shifted my position, as evidence has come in on the Medicare co-payment. You speak to people like the Australian Medical Association, Doctors Reform Society, you read the latest editorial in the Medical Journal of Australia, and a thinking person would naturally come around to the position that a co-payment isn't a good idea. 

On universities, I've never supported the sort of package that Christopher Pyne is putting together, which, as Bruce Chapman, the architect of HECS, has pointed out, could really destabilise the system. The idea of putting a real interest rate on people who've already graduated is breaking a social contract that was fundamental to HECS. I'm really worried these measures could blow the system up, could take low-income people out of universities.

HAMMER: Andrew Laming, it's been a measure of successful governments in the past, and one can think of governments like Bob Carr's in NSW, but also John Howard's government, that when they got into political difficulty they were able to read the wind and make some concessions. Are we getting to that point yet where this new government, yet to really be bedded down in the minds of the Australian people, need to make some concessions, say on Paid Parental Leave?

LAMING: Well, you're talking to a very strong fan of Paid Parental Leave in the form the government's presenting. I'm just delighted that Andrew's now come around to oppose co-payment because there hasn't been a lot of new evidence really presented over the last three decades against a co-payment, but if millionaire doctors and the AMA have convinced Andrew not to support a co-payment, that's interesting.

HAMMER: So you've always supported a co-payment?

LAMING: I've always thought it was completely reasonable, as long as the system can ensure access for low-income, and the second, our system does through not charging co-payments on non-time-based visits.

HAMMER: Back to my initial question though, is it getting around time that the government has to give the appearance of listening to people, or make some concessions, if even if it's giving in to Clive Palmer and the cross benchers to pass some of these Budget measures?

LAMING: Look I think it's way too early for that. The focus from Joe Hockey has been when talking about 'leaners', really has overwhelmingly been about, when you look at the data, and you look at the shape of the budget, it's on young job seekers, predominantly, that's where the changes around Newstart are going to have the largest impact. This other range of categories are not the target of the government. The changes are extremely minuscule, in fact. The big changes really are in the under-30s, looking for work, and we're a nation that can find work for that cohort.

HAMMER: Okay, final question to you both, Andrew Laming to you first: what do you think we'll know at the end of this fortnight of sitting that we don't know now?

LAMING: Good question. Well obviously Clive Palmer is out looking for more staff, so maybe there'll be some clarity around that. Certainly you'll see more legislation introduced and more work for a new Senate, and then I think obviously the real focus really is going to be post-June 30. The government's obviously waited for a number of months as a result of our Australian political system that delays the new Senate, so I think all eyes are going to be on July 1.

HAMMER: Andrew Leigh?

LEIGH: I think we'll know the identity of a range of other Coalition members that don't like Paid Parental Leave. We've had George Christensen coming out describing it as "money for jam", Alex Hawke very articulately critiqued it in an article recently, and certainly he hasn't backed off those views, and we know that this is a policy which has lacked consultation. Warren Truss has claimed that he's consulted country women, but the Country Women's Association say they haven't heard from him, and the National Farmers Federation say they haven't spoken with him about it. So there's huge disquiet in the Coalition ranks about talking about the end of the "age of entitlement", and yet putting in place a $50,000-for-millionaires parental leave scheme, which is unfair, blows a hole in the budget, and does very little for the constituents the National Party claim to represent.

HAMMER: Okay gentlemen, thanks for your time today. 

LEIGH: Thanks Chris. Thanks Andrew. 

LAMING: Thanks, cheers.

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