Andrew Leigh

E&OE TRANSCRIPT

TV INTERVIEW

SKY NEWS, AM AGENDA

MONDAY, 23 JANUARY 2017

SUBJECT/S: Housing affordability; Medicare levy; Visit to refugee camp in Myanmar/Burma

TOM CONNELL: Joining me now is Labor's Shadow Assistant Treasurer, Andrew Leigh. Thanks for your time this morning on the program.

ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Pleasure, Tom. Happy New Year to you and your viewers.

CONNELL: And you, I hope you enjoyed a nice break before we got back into it all. What a way to start, housing affordability. I know it's something you enjoy talking about. The Government, reportedly the Treasurer is looking at this plan that has been rolled out in the UK, he is sounding out various ideas and it does look like it will be a priority for the Government in 2017. This plan could give billions in loans towards projects or agencies who are trying to build affordable housing, like the CEFC making projects that maybe would not have got finance from banks get the tick, what do you think of this plan?

LEIGH: Tom, housing affordability is a first order issue. The home ownership rate is now the lowest in Australia it has been in 60 years. For young people, the share of them owning their home is way down on where it was just a couple of decades back. You've got to distinguish between a policy which builds a small number of homes at the bottom end of the market and one which could make a difference right across the wide swath of the market. So sure, we should look at innovative financing solutions but let's not pretend that that's going to make it easier for middle Australia to buy a house. Here you need to look at something else the Conservatives have been doing over in the UK. In the 2015 budget the British Conservatives decided to make changes to negative gearing. The British Conservatives, against a scare campaign in which some of the tabloids said it was going to drive down house prices saw through significant changes to negative gearing of the kind that Labor has been proposing in Australia.

Why the battle over hiring rival employees could be the next big challenge for Australian workplaces, Business Insider, 19 January 2019

In 2006, Michael Devine worked as a computer scientist for the tech-giant Adobe in Seattle, Washington. Like most, he was always on the lookout for new and exciting job opportunities. But strangely, for a reputable computer scientist in the heart of Silicon Valley, the offers weren’t flooding in.

Four years later, Michael found out why. It turned out that his company had entered into a secret agreement with five other tech-giants – Apple, Google, Intel, Intuit and Pixar – not to hire each other’s workers. In an angry phone call, Apple’s Steve Jobs had warned Google’s Sergey Brin: ‘If you hire a single one of these people, that means war’.

When he realised how the firms had colluded, Michael Devine wasn’t happy. He and 64,000 other employees filed a class action and ultimately received a settlement. Unfortunately, it was only the tip of the iceberg. Soon after, the online retailers Ebay and Ituit were caught doing the same thing. So were the film producers Lucasfilm and Pixar. It wasn’t just the tech-giants, either. Hospitals had agreements to fix the pay and conditions for temporary nurses. Fashion designers were caught trying to reduce the pay and conditions for models. The list goes on.

What’s most alarming was just how widespread this conduct was once US regulators started looking. It made me worry: is this happening in Australia?

Baby Steps Lead to Big Achievements, The Chronicle, 10 January 2017

Fifty days into his walk across Africa, Canberran Matt Napier had braved the lion-filled ‘danger zone’ in Botswana, experienced the pain of blisters-on-blisters, and lost 15 kilograms. Not only was he distributing soccer balls to needy community groups, but he was doing so while living below the poverty line. He spent less than US$1.50 a day of food, which meant ‘the hunger pains are so bad I feel like I am going to faint’.

Yet when I interviewed Matt on my podcast last month, he was full of enthusiasm for his next challenge, and constantly thinking about innovative ways of raising money to reduce global poverty. In fact, I’d challenge anyone who meets him not to come away feeling more energised about Australians’ ability to do good in the world.

New Year’s resolutions are a great way to shake us out of our habits, and encourage us to try something new. The problem comes when we pick challenges that don’t have a path to get there. The major goal of ‘Walk the Kokoda Track’ is a whole lot more achievable if it comes with a minor goal of regularly walking up Mt Ainslie. The big aim of mental calmness may be easier to reach if it goes with using the Headspace meditation app for ten minutes a day.

So whether your goal is walking across Africa or being a better friend, I hope 2017 is a good year for taking baby steps to make big changes.

Andrew Leigh is the Federal Member for Fenner and this resolution was first published in The Chronicle, Tuesday 10 January, 2017. His ‘Good Life’ podcast is available via iTunes and other podcast apps.

Banking on a Fairer System for All, Daily Telegraph, 16 January 2017

Seventy-one years ago, economist John Maynard Keynes quipped ‘if you owe your bank manager a thousand pounds, you are at his mercy. If you owe him a million pounds, he is at your mercy’.

It’s a cracker line – but it isn’t true anymore. In today’s money, Keynes’s million pound debt would be about 1/2000^th of the loan book for one of the Australian big four banks. In the ‘too big to fail’ era, banks are rarely at their customers’ mercy.

Banking is one of Australia’s most concentrated industries. A new analysis from the Australian Securities and Investments Commission looks at the market share of our largest four banks: the Commonwealth Bank, Westpac, ANZ and NAB. It finds that they control 77 per cent of all banking assets, 80 per cent of mortgages, 75 per cent of credit card transactions and 80 per cent of household deposits.

Australia’s banks are big by international standards. Our banking sector is more than twice as concentrated as that of the United States, and more concentrated than banking in the major advanced economies.

Australian banking is becoming more concentrated. In 2007 the big four controlled 65 per cent of Australia’s banking assets. Today they control 77 per cent. They are also expanding into other markets such as funds management, financial advice, wealth management and mortgage broking.

It's Time To Put Markets Ahead Of Monopolies, Huffington Post, 6 January 2017

If you're looking for a good economics game to play this summer (and let's face it, who isn't?), then here's one of our favourites. Try seeing how many industries your family can name that are not dominated by a few large players. We guarantee that this isn't a game that will tie up the conversation all night.

In our recent study, published in the December issue of the Australian Economic Review, we calculated market concentration across the Australian economy. Unlike other countries, Australia's government statistician doesn't compile data on market share, so we instead used data drawn from a private firm: IBISWorld Industry Reports. For each of 481 industries, we measured the market share held by the four largest firms, a standard measure of market concentration.

Applying the rule of thumb that a market is concentrated if the largest four firms control one third or more, we find that more than half of Australia's industries are concentrated. For some industries concentration is higher still. In department stores, newspapers, banking, health insurance, supermarkets, domestic airlines, internet service providers, baby food and beer, the biggest four firms control more than 80 percent of the market.

Sir Tony Atkinson: The Economist who had the measure of inequality,                Canberra Times, 4 January 2017

If you've ever referred to ‘the 1 percent’, you're using the work of Tony Atkinson. Tony, who died on 1 January, aged 72, contributed as much as any modern economist to the study of poverty and inequality.

When I first met Tony in the early-2000s, I was struck by the contrast between his exalted status and his willingness to engage with a mere PhD student. He was the head of Oxford's prestigious Nuffield College, and had recently been knighted by both the British and French governments. It always made me smile when I thought that the only ‘Sir’ I knew was my inequality coauthor.

Trained originally as a mathematician, Tony could crunch numbers with the best of them. But like Adam Smith and John Maynard Keynes, he recognised the importance of economics being grounded in history and politics. He was generous to intellectual predecessors like his Cambridge teachers James Meade and Joan Robinson. When we worked together on the antipodes, he made sure that our articles acknowledged the groundbreaking work of Australian researchers like Timothy Coghlan and Colin Clark.

Tony's interest in poverty and inequality was piqued in the 1960s, when he worked with deprived children in Hamburg, Germany. Over the next five decades, there was virtually no aspect of the field that he left untouched. He created his own inequality measure (the Atkinson Index), devised a novel technique for estimating wealth inequality from inheritance data, and shook up public finance through his work on optimal taxation with Joseph Stiglitz (who would go on to win the Nobel Prize).

JOB CUTS AT THE TAX OFFICE LEAD TO A SURGE IN COMPLAINTS

Since coming to office, the Abbott-Turnbull Government has cut more than 3300 jobs from the Australian Taxation Office, while at the same time complaints about the Agency have risen by more than 40 percent. 

The number of staff cut from the tax office by the Abbott-Turnbull Government has been revealed in the government's answer to Labor’s question on notice. Since July 2014, the tax office has lost 3,347 employees to the Abbott-Turnbull axe. 

Off with her head (on our coins)! The case for an aussie republic in 2017, crikey.com.au, 22 December 2016

This week, the Australian National University published its ‘Trends in Australian Political Opinion 1987-2016’. The document compiles the results of the Australian Election Study surveys, which have been undertaken after every election to gauge political opinion.

Among the fascinating findings is the percentage of Australians who favour a republic. After the 2013 election, with a monarchist Prime Minister, support for a republic had ebbed to 53%, its lowest level in nearly three decades. In 2016, with the Australian Republican Movement's former leader as Prime Minister and an Opposition that had made achieving an Australian republic a key part of its 2016 election platform, support for a republic was unchanged, at 53%.

Could this be spun positively? Perhaps. It is the first time since 1996 (when support was at 66%) that support for a republic has not fallen in the Australian Election Study surveys. Yet the brutal reality is that even if 53% support carried through to referendum day, there is little likelihood that a referendum would carry the required four out of six states. Despite the barnstorming efforts of Peter FitzSimons and the Australian Republican Movement, support for having one of our own as head of state is as low as it's been in a generation.

E&OE TRANSCRIPT

TV INTERVIEW

SKY NEWS ON THE HOUR WITH ASHLEIGH GILLON

TUESDAY, 20 DECEMBER 2016

SUBJECT/S: MYEFO 2016; economic forecasts; China’s economy

ASHLEIGH GILLON: Joining us live now is the Shadow Assistant Treasurer, Andrew Leigh. Andrew, just a few minutes ago we did hear Labor's response when it comes to the budget update. Penny Wong – who's Acting Opposition Leader today – said, 'Well, Scott Morrison is weak, he missed an opportunity to lock in Australia's AAA credit rating.' But the government did improve by its budget position by $2.5 billion, it did manage to hang onto that AAA credit rating, for now at least. You wouldn't really suggest would you, that now is the time for the government to be making too many dramatic cuts at this point with the economy as it is, would you? Isn't this a good balance that the government has managed to strike?

ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Ashleigh, we've had an improvement in iron ore prices, entirely due to circumstances outside the government's control. It's got to do with what's happening with steel production and demand in China. But the opportunity right now is for the government to make decisions that not only add to the budget bottom-line but also help young Australians. So many of your viewers – whether they're young Australians, whether they've got kids, whether they're aware of the pressures in the housing market – will know that the home ownership rate in Australia is the lowest it’s been in 60 years. Increasingly we're becoming a nation that can't afford to house our children. If we make adjustments to negative gearing and the capital gains tax discount in the way Labor's proposed – grandfathered so existing investors aren't affected – then not only can we lock in the AAA, and lock in the lower mortgage rates that come with that, but also we can deal with one of the central economic challenges for Australia – that of declining home ownership. 

E&OE TRANSCRIPT

TV INTERVIEW

SKY NEWS, AM AGENDA WITH TOM CONNELL

MONDAY, 19 DECEMBER 2016

 SUBJECT/S: MYEFO 2016

TOM CONNELL: You're watching AM Agenda and joining me now in our Canberra studio is Shadow Assistant Treasurer, Andrew Leigh. Andrew Leigh thanks for your time this morning.

ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Pleasure Tom.

CONNELL: Now, we don't quite have the full picture yet but it's pretty clear we're going to see company income tax revenue down, deficit up – sounds a lot like the annual Wayne Swan MYEFO doesn't it?

LEIGH: Well, there was a Global Financial Crisis in that period, Tom -- the biggest downturn since the Great Depression. All the Australian economy has been hit with in recent years is Scott Morrison. I mean this is a government that said, in 2013, they would have the budget in surplus in their first year and in every year after that. They ran on campaigns of debt and deficit disasters – driving debt trucks around the country. Yet we've seen this year’s deficit eight times larger. We've seen net debt blow out to the tune of thousands of dollars for every Australian, under a government that said they would have the budget under control.