The Government's superannuation struggles - ABCNewsRadio

E&EO TRANSCRIPT

RADIO INTERVIEW

ABC NEWSRADIO WITH MARIUS BENSON

THURSDAY, 21 JULY 2016

SUBJECT/S: Labor Shadow Ministry; superannuation.

MARIUS BENSON: Andrew Leigh, good morning.

ANDREW LEIGH, SHADOW ASSISTANT TREASURER AND SHADOW MINISTER FOR COMPETITION: Good morning Marius, how are you?

BENSON: I am well. Can I just ask you about the interstices of the Labor Party post-election? First, because you are now the Shadow Assistant Treasurer, but the new Shadow Ministry is going to be announced on Saturday. Right now, there is factional warfare underway to determine exactly where the jobs go. The talk is that Tony Burke's going to go; you’ll become Shadow Finance Minister. Does that seem plausible?

LEIGH: Marius, my first focus is on being re-elected to the Shadow Ministry. As you know, caucus chooses the ministry in the Labor Party and we have a huge amount of talent. We have enough talented people to field 2 frontbenches – the second of which would still be more talented than the government's. So that's a hard problem for caucus to solve. We'll be solving that on Friday and then it'll be up to Bill Shorten where he decides to put people on the Saturday.

BENSON: ‘Labor Factions’ is a study for the specialist, but is it the case you're the only independent, non-factional player in the shadow front-bench?

LEIGH: It is, yes. One of those curious quirks of Australian politics.

BENSON: Let me go to just one other point on that before going to superannuation. Tanya Plibersek is your Deputy Leader; she's the spokeswoman on Foreign Affairs. Foreign Affairs is really not the main game in Australian politics – or any politics – domestic is the main game. Is it time for Tanya Plibersek to come in from the cold?

LEIGH: I don't think that's the right characterisation of Foreign Affairs. We are a medium-sized economy located a fair way away from the rest of the world. Our success relies to a large extent on our engagement with the world. Open markets, being engaged with multiculturalism, all of that's pretty important and I think Tanya's done a great job in articulating a Labor view on foreign affairs over the last few years. Again, it'll be up to Bill Shorten how he decides to best deploy Tanya Plibersek's considerable talents. 

BENSON: Let me go to superannuation because the details are inescapably complex, even more so given that they're not settled on by the government, let alone what will get through Parliament. But just in broad terms, is Labor in favour of the government approach of trimming tax breaks for the wealthiest?

LEIGH: Absolutely Marius. We put this on the table in April last year, as you recall, when we put Labor's superannuation policy out there. But what we were doing in some sense was undoing some of the rash decisions that Peter Costello had made in 2006 as he was in the process of squandering the proceeds of Mining Boom Mark I. The thing about Labor's changes was they weren't retrospective. We were suggesting that for people who had earnings over $75,000 in the pension phase – which typically means a balance over $1.5 million – that they might pay the same rate of tax that they paid before Peter Costello made his rash changes. 

The Coalition’s gone to the same issue, but they've done so in a way in which many people believe is retrospective. We think the way to deal with this is to have an independent review, which looks at the concerns that have been raised by a range of independent experts.

BENSON: So, allowing for those misgivings about retrospectivity, you are going to be ticking off on some of the proposals from the government on super changes?

LEIGH: Well, let’s see what the independent review comes back with – if the government is willing to go down that path. You've got a government at the moment which is very much in thrall to the far-right. You've got Bernardi and Christensen – ideological twins who are the government's equivalent of Schwarzenegger and DeVito ­– holding Malcom Turnbull hostage over a range of these policy issues. You've got Julie Bishop struggling to explain it, Eric Abetz calling for a ‘recalibration’ of the policy. It’s unclear whether the government can even get these changes through its own party-room. And that's why an independent inquiry would take some of the heat out and allow us to work in a constructive bipartisan fashion.

BENSON: But you know some of the proposals now. Is there merit in some of the proposals?

LEIGH: We'd like to have a look at the critique that's been made from a retrospective standpoint. We don't believe in retrospective legislation. That's why our superannuation proposals weren’t retrospective. The government, as you recall Marius, dumped these proposals on Australia in May and then a few days later rushed off to an election. That's no way to do careful economic reform. Particularly in a fragile economy where living standards have been falling over recent years. We do need to tackle the debt – that's absolutely true. There's been a significant debt blow-out since the Liberals came to office, and reigning in superannuation tax breaks is one way of dealing with that. We need to work our way through constructively and in a way that's not retrospective.

BENSON: But broadly – you just had a shot at Peter Costello – you think the changes which were introduced by the previous Coalition Government provided incentives for people to do things other than simply save for their retirement with superannuation tax shelters?

LEIGH: Both political parties now acknowledge that effectively. Both political parties are focused on how to reign in superannuation tax breaks. But we’re united on the Labor side. We have a firm view that we need to reign in some of the superannuation excesses, particularly at a time when inequality is so high. We can't afford to be cutting big cheques to people with multi-million dollar superannuation accounts. We need to make sure our tax system and our social safety net is as well-targeted as possible. Dealing with the superannuation excesses is part of that. They're growing fast, 38% of them now go to the top 10% of the population so we do need to do a better job of targeting those tax breaks.

BENSON: Broadly, do you see in the new Senate – that's again a large crossbench and very unpredictable crossbench – do you see a greater prospect of Labor and the government getting together and agree to changes in the economic field ­– in the case of your shadow responsibilities – than has been seen in the past?

LEIGH: I'd like to hope so, Marius. I think Australians expect us to work together and that's the way in which we're going to be able to get the budget deficit under control and also deal with bigger challenges such as falling living standards and rising inequality. You'll be aware that Bill Shorten’s just written to Malcolm Turnbull, calling on him to join Labor in making a bipartisan submission to the independent Fair Work Commission, calling for penalty rates to be maintained. Penalty rates aren't just a way of protecting the weekend – they also top up the wages of those at the bottom of the income distribution. And if Malcolm Turnbull can come on board with that, we can start to work together on making sure that the people on the bottom end of the distribution don't see their wages falling further and further behind those at the top.

BENSON: Andrew Leigh, thank you very much.

LEIGH: Thank you, Marius.

ENDS

 


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