TUESDAY, 30 AUGUST 2016
SUBJECTS: Labor’s positive plans for the budget.
PETER VAN ONSELEN: I'm joined now by the Shadow Assistant Treasurer, Dr Andrew Leigh, live from the nation's capital. Thanks for your company.
ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Pleasure Peter, great to be with you.
VAN ONSELEN: We'll get to some of your portfolio areas in a moment but I just wanted to ask you about the story across the top of the Financial Review – China donor says Australian MPs, quote, "Not delivering". You must have read this piece. It's unbelievable to my way of reckoning. He's the chairman of a property development group and he's given more than $1 million to both major parties over the last four years. And this is his quote from an editorial that he wrote in the Global Times newspaper. It's been translated into English. Quote, "The Australian-Chinese community is inexperienced in using political donations to satisfy political requests." How does that make you feel? That sounds to me like cash...for outcomes.
LEIGH: It was a strange quote indeed, Peter. The gentleman is not somebody who I've met before. But certainly my philosophy with political donations has always been that people should give because they want to contribute to the democratic process, not because they want to buy an outcome for themselves. As you say, doing so is to subvert what democracy is all about – which is politicians executing the will of the people who put them there.
VAN ONSELEN: Let me go further Dr Leigh, the next quote's even more startling. Again from this editorial in the Global Times, written by this gentleman, I believe. Quote, "We need to learn how to have a more efficient combination – a more efficient combination – between political requests and political donations." Unbelievable, isn't it?
LEIGH: Strikes me as strange too, Peter. Absolutely.
VAN ONSELEN: The follow-up question is; we need reform don't we? Because we can't have someone giving millions of dollars to our government and to our alternative government thinking that if they give millions of dollars they can get political outcomes from it. How can we stop that attitude permeating into our political donations system, 'cause it's clearly there now?
LEIGH: You're completely right. We've been arguing for some time that we need to bring down the donations disclosure threshold. Indeed, Labor discloses voluntarily at a lower level than we're required to by the law.
We also need to crack down on the use of associated entities in order to funnel donations through. The Liberal Party's Millennium Forum has been used in that away. And that's, again, not what the disclosure is set up to do. We can probably also do a better job in terms of having disclosures happen more rapidly, rather than with this long delay as in the current system.
VAN ONSELEN: What about banning donations altogether from overseas, or at least banning them from individuals or organisations coming from non-democracies? Clearly they don't understand, or at least in this case don't understand, what political donations are about versus what, frankly – let's call it what it is – potentially what otherwise might constitute bribery, or perceived bribery at least.
LEIGH: Peter, you're right that there are other countries in the world – the United States being the one that obviously comes mind – that don't accept donations from overseas. I don't think you can do this for a couple of countries, I think you have to make the decision as to whether you ban all overseas donations or not.
VAN ONSELEN: What's your view on that?
LEIGH: I'm open to the idea. It’s not one that's been strongly debated. Most of the debate around donations in Australia has really been around bringing down that threshold and making sure we've got full transparency in the system. My view is let's get those things done first, Peter.
VAN ONSELEN: But you know we can walk and chew gum at the same time. You think about these issues more than most, frankly. You've written about a lot of these issues in some of your books over the years as a professor of economics. Surely banning donations from overseas helps keep Australian democracy vibrant, doesn't it?
LEIGH: I don't think that's been the main source of problems in recent years, to be frank. I think that the donations from the property sector have been the main source of calls to then Independent Commission Against Corruption. And that's why New South Wales, for example, has banned developers from donating altogether.
VAN ONSELEN: Should that happen federally? I mean this fellow is a developer.
LEIGH: You want to be really careful that you're doing something based on the right principle, rather than just responding to xenophobia. I'm open to it as I say, but I'd want to have the argument first. We're a much more open country than the United States. More of us were born overseas. We're more engaged with global trade and migration, so it might make sense that as a more open country that we're more open in this respect as well. As I've said, I've got an open mind.
VAN ONSELEN: Let's move on to some other issues. The omnibus bills – do you think that Labor will ultimately support it once you get a clearer look at it?
LEIGH: There are 600 pages in that bill, so it makes a fine doorstopper but it's not something that you'd expect to have our full response on within 24 hours of being given the bill. Frankly, if Malcolm Turnbull wanted true bipartisanship, he wouldn't have dropped this bill on Labor after our party room meeting yesterday, we would have had it two weeks ago so we had the time to work through the detail and give a considered position on it.
VAN ONSELEN: That said though, you're amenable to it as long as there are no tricks within the 600 pages? Would that be a fair summation?
LEIGH: We've been absolutely clear that the position we took before the election is the position we'll take after the election. You won't see the approach from us that you saw from Tony Abbott with his "no cuts to schools, no cuts to health, no cuts to the ABC or SBS" and then back flipping on all of those like breaking promises was a to-do list. You'll see us take a consistent position there, but we'll need the time to work through the detail.
VAN ONSELEN: What about more broadly in terms of the economic settings in a policy sense that Labor took to the last election? Now, you did lose the last election, albeit I suppose you could say lost it well, rather than badly, pricking up a host of seats on the way through and exceeding expectations – maybe that's the way to put it. But nonetheless, it was a defeat. How many changes do you think the Labor Party and the leadership group will be open to around policy areas that went to that election but as I say an election that ultimately Labor didn't win?
LEIGH: Yeah look it's a great question, I mean, parties never take to the next election precisely the same suite of policies they took to the previous election, but I'm pretty proud of the set of policies we had. Take something like negative gearing, for example, those changes had been called for, for over a decade by a range of experts. We actually came out with a plan that was grandfathered, that added to the budget bottom line, and which improved housing affordability.
VAN ONSELEN: So that's one that you would want to see stay? From your perspective, the negative gearing policy as it was constructed for the last election, you would hope that that survives the next three years if the parliament lasts that long?
LEIGH: Absolutely, Peter. And in areas like that I think we need to continue to build on our policy suite, but the world changes as well, and the next election – whether it's next year or maybe even the year after – there will be a different set of circumstances facing us and we'll need a different set of policies calibrated to that.
VAN ONSELEN: What did you think of the Treasurer's remarks from last week that we could well be facing a recession in the years ahead, and equally I suppose, the Prime Minister now elevating paying down debt as the greatest moral challenge of the age?
LEIGH: Yeah I mean, Scott Morrison has got an unusual approach to politics, you've got to say. I went to see Ben Folds playing on Sunday night and he has this song about angry white men who are angry about all the cruel things the world's done to them. Scott Morrison does a great line in anger and the song could almost have been written for him. But when you're the Treasurer of the nation, you've got to be crafting a clear narrative about where the place goes. You've got to be articulating where the jobs of the future come from, talking about the opportunities, engaging with globalisation and the international institutions. I see disappointingly little of that from Scott Morrison.
VAN ONSELEN: Alright, and the Prime Minister? Him talking about the greatest moral challenge, paying down debt? In the context of that, I wanted to get your thoughts, actually, on an idea that Professor Richard Holden has, I know you know him quite well. He would like to see an adjustment to the way that we look at debt and the way that the budget calibrates debt. He would like to basically see recurrent – sorry not debt – spending, he would like to see recurrent spending separated as it is for business, from spending that goes into things that can ultimately create more productivity – infrastructure spending and the like. Would you like to see that sort of change to the way that we look at the budget, so we can have what Professor Holden calls, 'good versus bad spending' that can be looked at?
LEIGH: Look Richard is one of the smartest economists in Australia and I'm always keen to engage with him on questions like this. The argument that I've put back to Richard on the notion of splitting the recurrent from the capital account is that it misses the fact that sometimes, your capital spending can have a low pay-off and your recurrent spending can have a high pay-off. So take the example of building a road to nowhere versus investing in great schools. The road to nowhere sits on the capital account; investing in better schools, say, providing superstar teachers for disadvantaged kids in an Indigenous community sits on the recurrent account. But actually investing in human capital, in that case, has a bigger pay off for Australia than investing in physical capital. So, the split might miss the opportunity to invest in great schools for example. We've got to do better in ranking our infrastructure spend.
VAN ONSELEN: Can I ask on that – that's an interesting point, Dr. Leigh. Because I guess what you're saying there is that there’s the capacity for any recurrent expenditure to be seen as 'bad' when in fact, as you point out, investing in human capital can have returns in and of itself. Would that be your concern with it?
LEIGH: Right. That's a pithier way of what I was trying to say, Peter, thanks, yes
VAN ONSELEN: Before we run out of time, I've got to ask you about same-sex marriage. I see that Bob Brown has come out in favour of the plebiscite rather than the outcome of doing nothing over the next three years. If it becomes a binary choice like that, is there a chance in your game of 'chicken' with the government, Labour might just jump out of the lorry at the last moment and allow the plebiscite to go ahead?
LEIGH: But Peter, why would it come down to nothing? I mean, we know that the Parliament is there, it's able to pass laws, and we know the numbers are now there in the Parliament for same-sex marriage. Let's just get on and get it done. As my former boss Michael Kirby has pointed out, a plebiscite's pretty alien to the Australian constitutional tradition. In the last century, we've had a plebiscite on the National Anthem, and that's about it. The only ones you've got before that are the conscription plebiscites and so really, it's an unusual way of giving equality to same-sex couples. And one which could damage the mental health of young gay and lesbian Australians. I'd prefer to see parliamentarians doing their job and spending that $250 million on better schools and better hospitals.
VAN ONSELEN: Just as a quick follow-up question to that, sorry. But you talk about the mental health anguish that could happen to the LGBTI community, I've talked about that myself. But what about Bill Shorten, he didn't seem concerned about that in 2013 when he said that he was comfortable with a plebiscite?
LEIGH: Well, you've got to remember what the circumstances were at that stage, Peter. Bill was looking at a parliament where the numbers were clearly not there to get same-sex marriage up. Now that the Parliamentary numbers have shifted, now that there's clearly the numbers in the Parliament, why should we go through the process that will damage the mental health of young gay and lesbian Australians? You know, in my electorate there's 31 same-sex couples who were married in 2013 in that five days where same-sex marriage was legal in the ACT. I think about them a lot and the fact they've waited nearly three years in order to have their love be reflected in matrimony. For those couples, for the families around them that just want attend their grandchildren's wedding, let's just get on and not be the last hold out in the advanced English speaking world against same-sex marriage.
VAN ONSELEN: Well, there's going to be a debate over who's responsible for another three-year wait: Labor for blocking the plebiscite-
LEIGH: Ah, another process debate.
VAN ONSELEN: Or the Coalition for refusing to have a free vote. We'll see where it goes; I suppose if it comes to that. Dr Andrew Leigh, appreciate your time, as always thanks for joining us.
LEIGH: Thank you, Peter.