THURSDAY, 22 OCTOBER 2015
SUBJECT/S: Labor’s positive plans for the sharing economy; Joe Hockey’s valedictory.
FRAN KELLY: Later today Labor leader Bill Shorten and his Shadow Assistant Treasurer Andrew Leigh will announce Labor's new sharing economy policy. Labor asked for, and received, more than 500 policy submissions from interested parties including Uber, GoCatch and Airbnb. Andrew Leigh joins us now. Andrew, welcome back to RN Breakfast.
ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Thanks Fran.
KELLY: Labor's policy lays out six economic principles for the sharing economy. But it doesn't really offer solutions yet, which is the hard part of this – how to regulate the sharing economy, isn't it?
LEIGH: Well Fran this is about a national conversation on the sharing economy. We know we've now got one in 200 Australian homes listed on Airbnb, and within a year of setting up in Sydney one-tenth of Sydneysiders had used Uber. So it is important that smart governments move ahead of this and create the environment for innovation to flourish, but also an environment in which we make sure that sharing economy firms are paying their fair share of tax, they're supporting good wages and working conditions, they're providing access for people with disabilities, they're looking after public safety and they’re playing by the rules.
KELLY: Okay, the overarching principle of your policy, the Labor plan, is primary property is yours to share. So acknowledging that it is yours to share. But then your policy says when Australian use their own cars, homes or goods to deliver services, rules and regulations specific to the sharing economy should apply. So, crunch time, what are those rules you think should apply?
LEIGH: Well if we just take one example Fran, the ACT is the only jurisdiction now which has moved to regulate and legalise Uber. They've done that through changing some of their taxi laws, through cutting the price of tax licences down to just a quarter of what it was, and also by removing some of the other regulation that fell on taxi drivers. But they've also very clearly said to Uber that they need to play by a certain set of rules. For example, they’ve said that they need to ensure they’re coming within the workers' compensation net if they demand that their drivers are only working on the Uber platform. So we need a sensible set of laws and at the moment we've got laws which were designed before the rise of smartphones and ubiquitous internet. But there is no reason that means we need to give away those important values of making sure that people are safe when they stay in a strange city, and that workers get to enjoy a wage that can allow them to raise a family and pay a mortgage.
KELLY: It's like wrestling with smoke though, isn't it, because you want to keep these businesses fleet of foot, that's how they run, that's how they move, that's how they grow. You know, you don't want to get them bogged down in regulation, but nor do you want them to be unsafe or unfair. So in terms of public safety, because I think Labor says that's the number one public concern, if you're looking at public safety and insurance, are you talking about every business, every car owner, every homeowner with an Airbnb room having to have public indemnity insurance? Because that's really expensive isn't it?
LEIGH: Well one of the things I've noticed in talking to these companies Fran is that insurance is a much bigger issue for little firms. Large firms are able in some sense just to self-insure, to say that everyone on the platform is covered. But if you take the Newcastle-based firm Camplify, which is looking to allow people to hire out their caravans and campervans to other people, noting the typical caravan owner only uses it for three weeks a year, a firm like that needs a regulatory base so they can go to the insurers and say: help us solve the insurance problem.
KELLY: Are the insurers getting into this? Or is this what Labor is trying to do and what the Government, ultimately, hopefully will try and do, to get the insurers to meet what is happening in the economy? We seem to be behind the eight ball in this in Australia.
LEIGH: Well we are Fran, but it is really government that's holding it up. The insurers are falling over themselves to offer insurance policies which deal with the nuances of the sharing economy. You've got, for example, people who just rent out a spare room in their house once a week and that will help them pay the mortgage. I spoke to one woman who, after her husband walked out on her and the kids, the only way she could keep on paying the mortgage was by renting out the spare bedroom on Airbnb. So we've got to have light touch regulation there, but also we've got to make sure that Australia's settings encourage innovation so that the next Uber or Airbnb is an Australian-based firm.
KELLY: Yeah, because these are ideas and they grow into big business, but it also has to be fair. The basis of your policy is that new services must support good wages and working conditions, and people must pay their fair share of tax. So the people you're talking to there, renting out a spare room on Airbnb, the only way they can make ends meet, are all supposed to declare income on their tax return. In August, Airbnb in Ireland informed hosts that the details of their income would be passed onto the Irish taxman. Do you think that's a good option or do you think that would kill it off?
LEIGH: It is important that we have those conversations between the revenue authority and the sharing economy services. I'm yet to meet a sharing economy service, Fran, that says their only comparative advantage is tax dodging. They’re keen to make sure that they are contributing to the public services that we all enjoy and frankly, this ought to be easier with the sharing economy because all of the transactions are electronically tracked. So people ought to, at the end of the year, simply be able to get a statement saying the amount of tax that they owe.
KELLY: Can I just ask you finally, Andrew Leigh, as Labor's Shadow Assistant Treasurer, your response to Joe Hockey's final farewell speech yesterday? He talked about some tax measures Australia must bring in: he says we must increase and broaden the GST, and he also said paring back generous tax concessions on super and moving on negative gearing are key. Do you welcome that?
LEIGH: Well Fran I certainly appreciated Joe Hockey's speech, it was as big as the man himself. It really encompassed the whole chamber; the stuff about his family was particularly poignant. On the conversation around tax reform, that’s where we part with him. We believe that at a time when confidence is flagging and inequality is high, it wouldn't be the right time to raise the GST. But we do believe that sensible conversations around whether our superannuation tax concessions are fair or sustainable are right to happen and it was really pleasing to see that although he didn't pursue those conversations as Treasurer, he has flagged them as the next agenda for his successor.
KELLY: Andrew Leigh, thank you very much for joining us.
LEIGH: Thank you, Fran.
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