Andrew Leigh

Matter of Public Importance Debate

Housing Affordability

Tuesday 1 March

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I was holding a street stall recently when a young couple came up to chat about their troubles buying a first home. She was a teacher, he was a builder, and they were thinking about having a family but they were worried that they would not be able to meet the mortgage repayments when their two incomes went down to one. Despite being in their late 20s, this couple were looking at moving back in with their in-laws. Changing nappies and juggling sleepless nights under the same roof as their in-laws was not their idea of the Australian dream. But their story is, sadly, typical.

Since the early 1980s the share of 25-34 year olds who own their own home has fallen from about 60 per cent to about 30 per cent. It used to be the case that the top fifth were just as likely to own a home as the bottom fifth but now there is a 15 percentage point gap in home ownership rates between the top and the bottom. In the early 1980s the average home loan for a first home buyer was $81,000. Now, it is $308,000. Over just the last two years we have seen house prices in Australia go up 20 per cent and yet we have got the slowest wage growth in 18 years. As the young Canberra couple said to me, 'It's hard to afford a mortgage when the prices are going up so much faster than your income.'

Those opposite want to pull up the ladder of opportunity on young Australians. The gap in homeownership is another part of the growth in inequality that Australia has seen over the course of the last generation, where earnings have risen three times as fast for the top 10th as for the bottom 10th, and where the wealthiest three Australians now have as much wealth as the poorest one million Australians.

Seeking Social Capital Stories, The Chronicle, 1 March

Six years ago, the year I entered parliament, I wrote a book titled Disconnected, about the collapse of community life across Australia. In the decades leading up to 2010, Australians became less likely to join community organisations – a trend that can be seen in membership data from bodies as diverse as Rotary, Lions, Scouts, Guides and Apex. We became less likely to go to church and less likely to join a union. We became less likely to know our neighbours, and the average Australian reported fewer close friends.

Since becoming a member of parliament, I’ve met hundreds of passionate social entrepreneurs, and hoped that the trends might reverse. But if anything, new data suggest that the drop is continuing. Since 2010, Australians are less likely to be involved in social groups (down from 63 to 51 percent) and political groups (down from 19 to 14 percent). We are less likely to give money to charity (down from 71 to 65 percent), play sport (down from 74 to 70 percent) or volunteer (down from 36 to 31 percent).

Hidden heroes who should be household names, Canberra Times, 1 March

The Lucky Country is fortunate to be served by so many inspiring public servants.

When Bob Stirling started working as a public servant, he probably never imagined that his skills as a dog breeder would come in handy. But thanks to him, beagles became the friendly face of Australia’s quarantine regime.

They ultimately helped him design and manage the detector dog program that put beagles as the friendly face of Australia’s quarantine regime. As Stirling once observed, ‘‘even people who are afraid of dogs are not afraid of beagles. Beagles are cute, they have a brilliant sense of smell and they are single-minded to the point of stubbornness.’’

These days, beagles have been replaced by labradors but, thanks to Stirling’s creative approach to solving a problem, Australia turned security screening into a positive public outreach effort that continues to set our airports apart today.

When you start looking, stories like Stirling’s pop up from all over the Australian Public Service

E&OE TRANSCRIPT

TELEVISION INTERVIEW
SKY NEWS TO THE POINT
MONDAY, 29 FEBRUARY 2016

SUBJECT/S: Negative gearing, multinational tax

PETER VAN ONSELEN: Thanks for your company Dr Leigh.

ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Pleasure, Peter.

VAN ONSELEN: Let me ask you straight off the top about this; are you worried about a scare campaign? As you know I've written in favour of your negative gearing policy. I take the view that it is long overdue that something gets done in that space rather than quibbling about the detail, akin to what Saul Eslake said, don't let the perfect be the enemy of the good. But what about a scare campaign, sometimes in politics they can often be effective and it looks like that's where the Government is going on your negative gearing policy?

LEIGH: Well Peter if you constantly worry about scare campaigns you never do anything in politics. Now the Prime Minister has delivered more waffles than a breakfast café. He’s unable to actually put his ideas on the table. Labor has done it. They're not universally popular but it's a set of policies which adds to the budget bottom line, which closes down some of our fastest growing tax concessions, which doesn't affect existing investments which adds to housing supply.

We know in Australia that the chance for a young person with low income buying their home is half of what it was in the early 1980s. Sydney is the second most unaffordable city in the world, just after Hong Kong, Melbourne is the fourth most unaffordable, measured on house price to income ratios. We just can't go on with an Australia where young Australians can't make their way into the housing market. Labor's plan tackles that challenge which is why it has been welcomed by everyone from Jeff Kennett to Saul Eslake and why it in fact reflects ideas that have been talked about for a decade in Australian politics but until Bill Shorten and Chris Bowen, no one had the courage to act.

LABOR CALLS FOR TOUGHER MULTINATIONAL TAX PENALTIES 

Labor has today introduced a Private Members Bill to toughen up penalties for companies that don’t comply with Australia’s new country-by-country tax reporting rules.

As of 1 January this year, companies doing business in Australia with global turnover over $1 billion must give the Australian Tax Office information about their economic activity and tax paid in every country where they operate.

These country-by-country reports will be a vital tool in helping the tax office identify profit shifting and tax minimisation strategies. They were a key recommendation of the OECD’s major Base Erosion and Profit Shifting Action Plan, released in 2015.

Yet under the Government’s current laws, the maximum penalty a firm would pay if it fails to lodge its report is $5,400. For a company with $1 billion in revenue, that represents 0.00054 per cent of their annual turnover.

Tax Laws Amendment (Tougher Penalties for Country-by-Country Reporting) Bill 2016 

HOUSE OF REPRESENTATIVES 

MONDAY, 29 FEBRUARY 2016

Dr LEIGH (Fraser) (10:38):  I move:

That this bill be now read a second time.

Picture a glorious summer's evening at the SCG: the stadium lights are blazing, the dusk is settling in, and family and friends are abuzz at the prospect of a close finish to a match that is hanging in the balance. Suddenly a naked man runs out on the pitch, screaming in front of thousands. The security detail finally tackles him after a minute of cavorting.

Incidents such as these are not uncommon. One happened late last year at a Big Bash Twenty20 match, prompting Ricky Ponting in the commentary box to say: 'Let's hope that is a $6,000 fine at least. It's disgraceful; we don't like seeing that. Some people probably do, but it's a bad look for the game.' He was certainly right that the look was bad—for the streaker as well as for the game—but unfortunately Mr. Ponting's quite reasonable minimum fine threshold was above what the real streaker would receive. The penalty for invading the pitch at the Sydney Cricket Ground is $5,500.

E&OE TRANSCRIPT

DOORSTOP

CANBERRA

MONDAY, 29 FEBRUARY 2016

SUBJECT/S: Tax reform, multinational tax

ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Good morning everyone. Today I'll be introducing into Parliament a private member's bill to toughen the penalties on multinationals. I want to say a couple of words about how we got here. In 2013, Labor in office introduced the biggest ever package cracking down on multinational tax avoidance. The Coalition voted against it. We introduced changes that provided more tax transparency and we saw the first data released last December. The Coalition voted against those too. In the first half of this Parliamentary term, Labor put together a $7 billion multinational tax plan carefully costed by the Parliamentary Budget Office and informed by the OECD. The Coalition are refusing to implement it. When the Coalition bring to Parliament their plans, they just have asterisks where the budget numbers should be. The Coalition are yet to bring a serious multinational tax plan to the Parliament. 

Last week we saw Labor in the Senate amend multinational tax laws to provide more transparency and therefore ensure more tax paid by multinationals. And today I will be introducing a private member's bill that will ramp up the penalties. Because right now, for a multinational that fails to lodge its country by country accounts, the fine is $5400. To a billion dollar company, that represents 0.00054 per cent of their revenue. It's a slap on the wrist when we need a serious penalty. When we say to a company ‘obey the law or pay the fine’, we don't want them to chuckle out the side of their mouth and just go off and pay the fine. My private member's bill will increase the penalties on multinationals 50-fold from $5400 to $270,000 plus triggering an audit if firms don't comply. Australians have had enough from firms who don't play by the rules. Labor is the only party who is serious about tightening rules on multinational tax.

Yet again, Labor is leading the debate on tax. The chances of Malcolm Turnbull coming up with a fair, pro-growth tax plan are like the chances of Godot turning up midway through a Samuel Beckett play. Malcolm Turnbull is simply incapable of providing the tax leadership and the economic leadership that he promised before he got rid of Tony Abbott. Labor is serious about tax, we have a hundred billion dollars of carefully costed savings plans on the table and we're providing the economic leadership that Malcolm Turnbull promised but has failed to deliver. Happy to take questions.

UP, DOWN; RICH, POOR: IT’S THE TURNBULL HOKEY-POKEY

Having seen how well running two contradictory scare campaigns worked out yesterday, Malcolm Turnbull has decided to add even more confusion to his Government’s chaotic position on negative gearing.  

Just as Malcolm Turnbull argues Labor’s negative gearing policy can simultaneously drive prices up and down, apparently it can be both an attack on the wealthy and a gift for them all at once.

E&OE TRANSCRIPT

RADIO INTERVIEW

ABC NEWSRADIO

THURSDAY, 25 FEBRUARY 2016

SUBJECT/S: Lowest wage growth on record under the Coalition Government’s economic management; Tax reform

MARIUS BENSON:  Andrew Leigh, good morning.

ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Good morning, Marius. How are you?

BENSON: I'm well. Do you share that view – I guess it's not a view, it is an Australian Bureau of Statistics fact – that we are getting poorer?

LEIGH: It’s a real concern, Marius. I think the reason this has come about is people have been focussing on the headline GDP number for many years. But GDP doesn't account for population growth. We are one of the fastest-growing countries in the OECD in terms of population. When you take that into account, you can look at something like Net National Disposable Income per person and that has actually fallen 3.5 per cent since the Coalition came to office. That is one of the best measures of living standards that we have.

MORE TRANSPARENCY, SOONER FOR BIG FIRMS THANKS TO LABOR 

The Senate has today passed Labor amendments that will give the Australian Tax Office access to information about big companies’ financial affairs sooner, and improve public transparency.

The Common Reporting Standard is an important global agreement for cracking down on multinational tax avoidance. It allows tax authorities to automatically exchange information about the contents of company and individual bank accounts.

Until now, multinational companies and wealthy individuals have often been able to avoid paying tax in one country simply by sending their money offshore to another jurisdiction so that tax authorities cannot see it.