2CC CANBERRA DRIVE
TUESDAY, 23 JUNE 2020
SUBJECTS: Federal Labor’s calls for a Royal Commission into Robodebt; Liberals Undermining Superannuation (Again)
LEON DELANEY, HOST: Joining me now Member for Fenner and Shadow Assistant Minister for Charities and Treasury Dr Andrew Leigh. Good afternoon.
ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: Good afternoon, Leon. Great to be with you and your listeners.
DELANEY: Well thanks for joining us once again. First of all, why do we need a royal commission on this issue? Don't we already know what went wrong?
LEIGH: I think we need to get to the absolute bottom of what's happened with this significant scheme. I mean, this is a scheme designed to extract one and a half billion dollars of unlawful debts from the Australian people. Hundreds of thousands of people are having their debts repaid, and indeed pretty much everybody who came to my office has had their debts repaid. A whole lot of Canberrans have been affected by this. I've had constituents who had the debt collectors sicced onto them as a result of a process in which the Morrison Government took the humans out of Human Services and just allowed computer algorithms to run amok, ruining people's lives.
DELANEY: But as I said, we already know that. What would a royal commission actually achieve?
LEIGH: We need to find out who came up with the idea for the scheme, what due diligence was done, when did the government learn that it was unlawful. We need to go to questions about the repayment of debts - when you owe something to the Commonwealth, you're expected to pay interest, but the Commonwealth is currently saying it doesn't have to pay interest on money that it owes to Australian taxpayers. We need to know how many people have been harmed, how many people have indeed taken their own lives. This is a scheme which has done massive harm to the Australian people, and only a royal commission will get to the bottom of it.
DELANEY: That issue of paying interest is just one discrepancy, isn't it really? Because when the government was raising these debts in the first place, it was trawling back through people's history for many, many years, whereas if for example Centrelink had accidentally underpaid a recipient of through some fault of theirs, the recipient could only go back I think it was two years or three years to make a claim. There was a time limit that didn't apply the other way around.
LEIGH: That's absolutely right. There's this asymmetry in how the federal government treated taxpayers and how taxpayers could behave from relating to the federal government. Also Leon there are broader lessons to be learned from this. This is an absolute travesty, a debacle, but it's also a product of allowing technology to run rampant. And the one thing we know about the way in which government services are going to operate in decades to come is they're going to be more technological. So I think there are lessons to be learned from this about how to use automation well from an instance in which automation has clearly been used very badly.
DELANEY: The Prime Minister has previously made the point that earlier governments, including Labor governments, have also used income averaging. What's the difference?
LEIGH: Of course we used the computer systems, but we kept the humans in the loop. As I said before, this is a government that decided it would just take the humans out of Human Services, would send letters based on nothing more than data matching and algorithms. That's no way to treat the Australian people. I had people coming into my office in tears. I had people who said they had bouts of depression as a result of the unlawful debts that were extracted from them. I mean, there's no wonder there's a class action on foot at the moment, with hundreds of thousands of people wanting more than the mealy-mouthed pretend apologies they've gotten from the government so far. This is a scheme which has dug deep into the social fabric of Australia. It's done enormous harm, and only a royal commission is the right way of dealing with it.
DELANEY: Well, there's already a Senate inquiry. There's the legal action afoot. I mean, a royal commission is just another layer, isn't it?
LEIGH: The royal commission will go through the history of the scheme, find out how it came to be. It'll ensure that we see the particular court rulings, and we need to know at what point the government decided this was unlawful. It'll also be able to probe deeply into the scale of it - how much debt was taken and what was the human impact of that, Leon. And then it'll be able to make recommendations to ensure not only that this doesn't happen again, but that we don't have similar problems like this. You know, what happened was either the Abbott, Turnbull or Morrison Government - it's hard to keep track - decided that they need to prop up their budget bottom line, and so the robodebt scheme essentially emerged from a political necessity. So to prevent that happening again, we need a royal commission which is able to look at the issues of data matching, look at the issues of automation, and say ‘this is where it goes wrong and here are the long term lessons we’ve got to learn’.
DELANEY: On a different topic, the former Labor Prime Minister Kevin Rudd has written an opinion piece in The Sydney Morning Herald today under the headline ‘Scott Morrison's crusade on super is the biggest attack on working Australians since Work Choices’. Have you read the article, and do you agree with every word of it?
LEIGH: I haven't read the piece, but I certainly know that Kevin shares the view of the Labor Party on superannuation, which is this is a Labor creation. Labor built universal superannuation, Labor governments have looked to expand and improve on it. The Coalition has consistently looked to cut it. They opposed universal superannuation in the beginning. They paused universal superannuation under the Howard Government, and they paused it again under the Abbott Government. This current increase in superannuation has been legislated, so it would be a breach of faith and promise to the Australian people if Scott Morrison was to listen to the howls from his backbench, who somehow think that they're okay being on 15 per cent superannuation but low income workers shouldn't get 12 per cent. That approach is the double standards that I'm afraid we've just come to expect from some of the born-to-rulers that seem to occupy the Liberal backbenchers. Superannuation is a great Australian invention, and it ensures that we have much better budgetary sustainability than a whole lot of advanced countries right now that are struggling under the weight of having to pay retirement benefits to their population.
DELANEY: And that's one of the points that Kevin Rudd has made in his article today. Prime Minister Scott Morrison has said in response to these calls from his backbench, he said ‘well we're not thinking about that right now, we've got more important things to consider’. But Kevin Rudd says in his article today you simply do not get one in five backbenchers speaking in unison like that unless it has been authorised by the leader. Do you think he's right?
LEIGH: Absolutely. This is a coordinated campaign. I think they're testing the waters to see whether or not they're going to be able to breach their promise yet again. It would be an awful mistake if they were to do so, Leon. Superannuation ensures that working people are able to retire with a sense of dignity that you don't get in many other countries in the world that lack our superannuation scheme. It means that working middle class people enjoy the returns of the sharemarket, which is considerably higher than the economic growth rate, and get those assets that allow them to treat their grandkids, to take an overseas holiday, to be able to buy the sorts of things they've dreamed about getting when they're in retirement. So superannuation is just a fundamental pillar of our social safety net, and I get so outraged when I see people who have plenty in their nest eggs saying that low and middle income workers shouldn't have plenty in theirs too.
DELANEY: The argument is being put forward not only by these Liberal Party backbenchers, but also by significant numbers of the business community saying ‘look, the economy’s in fragile shape, now is not the time to proceed with these increases to the contribution rate because it will cost jobs and it will reduce wages’. Is that not a legitimate argument?
LEIGH: As Martin Fahy from one of the superannuation associations put it the other day, we’re talking about cents per day for the average worker. So you'd be talking, even if you have a handful of workers, about the price of a cup of coffee across your workforce each day. That is perfectly sustainable. It's appropriate that we increase the superannuation contribution, because we need to get workers’ retirement savings up to a comfortable and sustainable level. The government has legislated this, so it's pretty extraordinary that Scott Morrison can't then turn around and say ‘absolutely, we're sticking with it’. That he needs to take this sort of mealy-mouthed approach of trying to placate his backbench. It feels like we're doing climate change all over again, a prime minister who's just unable to make the long term calls in the national interest.
DELANEY: I'll refer back to Kevin Rudd's article one more time. So what reasons do the conservatives offer for sabotaging the retirement incomes of working people? First they claim it will boost wages. Yet if this were true, wages would have rocketed during Abbott's freeze. Instead wages flatlined while company profits soared. This was a direct transfer of wealth from working people to corporate executives. I would assume that you agree with that, but does that put paid to the argument that boosting the contributions to superannuation are going to erode wages?
LEIGH: Look, I don't think there's any sense in which we're going to see wage falls as a result of this. What we're going to see instead is people having appropriate amounts in their superannuation accounts. And it just shouldn't be hard for Scott Morrison to say yes to a measure which he has legislated. You wouldn't think it was a big request to say to a prime minister ‘will you put the legislation through, do you still back it’. And it shows again how weak he is, that he is unable to stand on the side of working people and say ‘you deserve higher superannuation’. After all, Scott Morrison enjoys 15 per cent superannuation, so why shouldn't working Australia get at least 12?
DELANEY: The current legislation says it will be gradually phased up to the 12 per cent. The original plan put forward by Paul Keating would have seen it eventually reach 15 per cent. Does Labor still stand by that plan?
LEIGH: Well, let's get to 12 first. I think that's a significant battle that we're having at the moment. I'm aware that, as you've pointed out, when you get a significant rattle in the reactionary ranks of the Liberal Party that that can lead to a prime minister attempting to backflip. Howard backflipped, Abbott backflipped. We're waiting now to see whether or not Morrison will backflip as well. Fingers crossed that he can actually do the right thing by working people for once.
DELANEY: Andrew Leigh, thanks very much for your time today.
LEIGH: Thank you.
Authorised by Paul Erickson, ALP, Canberra.