MONDAY, 29 JULY 2019
Subjects: The Morrison Government’s mediocre record on productivity, tax havens, Angus Taylor, the need to raise Newstart.
ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: Good morning. We've seen reports today that Australia's productivity performance is in the doldrums. After decades in which we had productivity growth averaging around 2 per cent, over the last couple of years we've seen it in just 0.2 per cent – a tenth of its previous level. The Productivity Commission has described productivity as being ‘troubling’ and ‘mediocre’.
We’ve got mediocre productivity performance from the mediocre Morrison Government.
For 19 out of 20 firms, their productivity is barely higher now than it was in the year 2000, when Sydney hosted the Olympics. And for the top 5 per cent of firms, they're falling off the international productivity frontier. Our top 5 per cent of firms simply haven't increased their productivity at the same rate as the top 5 per cent of firms in countries like Japan, Germany and the United States. We've seen under the Morrison Government an unwillingness to invest in the drivers of productivity – in infrastructure underpinned by cost benefit analysis, in a better education system, in modernising competition laws to drive the next wave of productivity. Instead, for the Morrison Government, productivity is all about cutting workers’ pay and conditions. But when the Productivity Commission was asked to assess the best drivers of productivity in their Shifting the Dial report, slashing workers’ pay and conditions was nowhere to be seen.
We've also seen today reports that tax havens are being used by Australian mining firms to avoid taxes overseas. For years, Labor has led the debate on multinational tax avoidance, dragging the Government kicking and screaming to acting on multinational tax avoidance. But we know now that tax havens are being used more than ever before. Two dollars out of every five of multinational profits are being channelled through tax havens like the Cayman Islands.
The Cayman Islands aren't just the place where Angus Taylor chose to set up Eastern Australian Irrigation. Tax havens like the Cayman Islands are also being used to undermine countries’ tax laws, meaning that countries like Australia miss out on the tax revenue to which they're entitled. Happy to take any questions.
JOURNALIST: On Angus Taylor, do you think he stood to benefit from his involvement? Do you think this push for an inquiry is fair?
LEIGH: Absolutely. We're seeing a push now from not just Labor, but also the crossbench, a recognition that Mr Taylor has overstepped the mark and has pushed his own interest in these internal meetings. We know Angus Taylor also has a history of complex financial dealings, from setting up Eastern Australian Irrigation in the Cayman Islands, a jurisdiction which has been a problematic secrecy jurisdiction for a considerable amount of time. The Cayman Islands is a location of choice for arms traffickers, drug dealers, for multinational tax avoidance. We need less operations in the Cayman Islands by Australian firms, not more.
JOURNALIST: Senator Hanson said this morning that she won’t support it. She says it’s a witch hunt. What do you think?
LEIGH: Well, Senator Hanson tends to vote with the Liberals and Nationals, so it's hardly a ‘stop the presses’ day when Pauline Hanson says she is supporting the Coalition.
JOURNALIST: Talk about wages, what do you think this focus on unions is doing? Is it detracting from your ability to focus on better productivity, better wages?
LEIGH: We know unions are an important part of ensuring that workers get their share of productivity gains. I spoke before about our lacklustre productivity performance, but even with that lacklustre productivity performance, workers aren't getting their fair share of productivity gains. That's why we've got the labour share of the economy falling over recent years. If you reduce the power of unions, you reduce the wage share which is going to workers. That then has significant consequences for people getting the money in their pay packets that they deserve. An attack on workers, an attack on workers representatives is only going to be bad for employees. I don't know why in an era in which we're seeing rampant wage theft, we ought to have the Coalition continuing to attack workers and their representatives, rather than going after the heart of the problem.
JOURNALIST: What do you think about the Nats doing their own costing on boosting Newstart?
LEIGH: We're seeing every day more and more people coming out and saying that Newstart is too low. Labor said that at the last election. We took to the last election a policy of reviewing Newstart, because we believed it was too low and needed to be raised. Now you've seen groups from ACOSS to the Business Council of Australia, you’ve got John Howard and Barnaby Joyce acknowledging that Newstart is too low and needs to be raised. The Morrison Government needs to get its head out of the sand. It needs to spend more time talking to people living on Newstart, less time sitting in the corner office. I know when I've spoken to people who are struggling to get by on Newstart, it's extraordinarily tough for them to make ends meet. A typical person on Newstart has been there for three years, which gives the lie of the government's claim that this is simply a temporary payment. Thanks very much.
Authorised by Noah Carroll ALP Canberra