Andrew Leigh

Crime and punishment: can we have less of both?

Opening address, Australian Institute of Criminology Conference, Canberra
Monday, 31 October 2022

Acknowledgements

I begin by acknowledging the Ngunnawal people, the Traditional Custodians of the land we are meeting on. I acknowledge and respect their continuing culture and the contribution they make to the region, and I pay my respects to their Elders, past and present.

I would like to especially thank Aunty Jude Barlow for her warm Welcome to Country.

Second Reading Speech
House of Representatives
26 October 2022
Aboriginal Land Grant (Jervis Bay Territory) Amendment (Strengthening Land and Governance Provisions) Bill 2022

The Wreck Bay Aboriginal community in the Jervis Bay Territory has an unusual status. It is part of my electorate of Fenner, but residents do not vote in state or territory elections. This means the Commonwealth has a particular responsibility to residents of Wreck Bay.

The Jervis Bay Territory is a special place. In a dozen visits, I have appreciated the chance to learn from and work with members of the community.

I thank my colleague Linda Burney, the Minister for Indigenous Australians, for allowing me to introduce this bill today on behalf of the Australian government.

The Australian government has worked with the Wreck Bay Aboriginal Community Council and the broader Wreck Bay community over a number of years to co-design the Aboriginal Land Grant (Jervis Bay Territory) Amendment (Strengthening Land and Governance Provisions) Bill 2022, with the most recent consultations on the detail of the bill in August this year. This bill will:

• strengthen the council's governance structures;
• enhance the control the council has over its own affairs; and
• help to enable homeownership style leases on Aboriginal land in the Jervis Bay Territory.

The Wreck Bay community is located in the Jervis Bay Territory, on the southern New South Wales coast, 126 kilometres east of Canberra. The Jervis Bay Territory was formally established in 1915, on the land of the Bherwerre Peninsula, through the enactment of the Jervis Bay Territory Acceptance Act 1915. First Nations people had been living in the area since long before that time, and never agreed to the surrender of these lands. Middens on the Bherwerre Peninsula provide evidence of thousands of generations of First Nations occupation of this area.

Summing Up Speech
House of Representatives
26 October 2022
Treasury Laws Amendment (More Competition, Better Prices) Bill 2022

My thanks to the members who have contributed to this debate. I acknowledge the work of both Small Business Minister Julie Collins and Assistant Treasurer Stephen Jones on this bill. This bill delivers on an election commitment to protect Australian households and small businesses by banning unfair contract terms and increasing penalties for anticompetitive behaviour.

The Australian Labor Party has a long history of economic reform that builds a fairer and more resilient economy. Competition is an essential part of that for three key reasons. First, competition is about fairness. Without government action, monopolists can wield their power to rig the game in their favour rather than compete on even terms. Second, competition deals with cost-of-living pressures and makes our supply chains more resilient. Competition means businesses offer Australians the best prices they can. A diverse and dynamic economy, a resilient economy, helps to absorb, adapt and solve the challenges of an uncertain world. Third, competition is about jobs and skills. Competition helps to ensure that the most innovative, creative and savvy businesses are the ones that thrive. Those are the businesses that are best placed to offer jobs that are stable, secure and well paid. Competition also gives workers more options, empowering employees to negotiate pay and conditions that reflect their true value.

A Zippier Economy: Lessons from the 1992 Hilmer Competition Reforms

University of Sydney
Monday, 17 October 2022
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I acknowledge the Gadigal people, traditional custodians of the land on which we gather today, and pay my respects to their Elders past and present.

Thank you to Sydney Ideas, the University of Sydney’s flagship public talks program, for hosting me today. I welcome the students, members of staff and alumni attending this afternoon. Having spent six years earning a couple of degrees here, including a year editing Honi Soit, it’s good to be back.

Given the topic of today’s presentation – lessons from the 1993 Hilmer Review and the subsequent National Competition Policy reforms – it’s also my pleasure to acknowledge Professor Fred Hilmer, who has joined us today. It’s both exciting and daunting to have the subject of today’s talk in the audience.

Introduction

As Professor Hilmer told me recently, the National Competition Policy reforms were big, bold and far-reaching.

He’s right in every respect – they’re regarded as among the most significant economic reforms in Australia’s history.

And we’re still talking about them 30 years later because they provide a powerful lesson for building a zippier economy.

Successful reform often looks deceptively easy afterwards.

E&OE TRANSCRIPT
RADIO INTERVIEW
ABC CANBERRA MORNINGS WITH ROSS SOLLY
MONDAY, 17 OCTOBER 2022

SUBJECTS: BUDGET ANNOUNCEMENTS, COMPETITION, MEDICARE RORTS AND BULK BILLING IN THE ACT.

ROSS SOLLY: As you may have heard yesterday, the federal government announced – or let the cat out of the bag with some infrastructure spending that will be unveiled in the mini-budget which is coming up. Now, a lot of money being splashed around the place everywhere except unfortunately it seemed for the ACT. Now, later onin the day, the government said, “Don’t worry, there is some stuff coming your way,” but they wouldn’t say what it was. So, I mean, I’m not cynical and I’m not suggesting a conspiracy theory, but maybe we just got forgotten about for a little while. I don’t know.

Andrew Leigh is the Assistant Minister for Competition, Charities and Treasury, and he joins me this morning. Andrew Leigh, good to talk to you.

ASSISTANT MINISTER FOR CHARITIES, COMPETITION AND TREASURY THE HOB DR ANDREW LEIGH: Great to talk to you, Ross. And sorry in advance – I won’t be able to spill the beans on the announcement that’s to come. But you can rest assured that with a Finance Minister from the ACT, the ACT is never forgotten in the Budget.

SOLLY: Well, that’s what I was a bit concerned about – how come everybody else got a little bit of the action yesterday and we were left sort of sitting on the subs bench waiting? The 90th minute came on, we still weren’t called on. We went into extra time – nothing happened. What happened?

Tax and Government in the 21st Century
Parliament House, Canberra
Thursday, 6 October 2022

One of Florence’s great city-states is the walled city of Sienna. Home to the famous Palio di Siena, an annual spectacle described as ‘the world’s most insane horse race’, its city building shows on the wall a painting known as ‘The Allegory of Good and Bad Government’. Painted by Ambrogio Lorenzetti in 1338 and 1339, it shows a well-governed society – happy people, productive enterprises, strong communities; and a badly-governed one – crime, garbage and dysfunction.

Miranda Stewart has chosen for her cover image of Tax and Government in the 21st Century a segment of Lorenzetti’s fresco depicting good government. It underpins her central message – and one that the rulers of Siena knew in medieval times – that taxation is an integral part of a good society.

Tax and Government in the 21st Century takes a broad sweep, both in time and space. It begins with the origins of modern tax systems, and the way that taxation was expanded to cover public goods. As the Bismarckian welfare state grew, so too did a need to fund unemployment insurance, health insurance and pensions. Stewart’s history is impressive, but I couldn’t help feeling that she perhaps gave too little attention to the role of war in expanding tax systems. For example, Australia’s federal income tax was introduced in 1915 (to pay for World War I) and massively increased in 1942 (to pay for World War II).

Budgeting, Miranda Stewart notes, is fundamentally an ethical exercise. She discusses the growing emphasis in government budgets on analysing the impact of taxation and spending policies on gender and inequality, and discusses the rise of green budgeting. Fittingly, as Treasurer Jim Chalmers has noted, a major focus of the October 2022 budget will be on wellbeing, and measuring what matters.

Another trend that Stewart notes is the rise of fiscal rules. In 1990, she notes, less than ten countries had fiscal rules. In 2021, more than one hundred countries had fiscal rules. But rule-following is imperfect, to say the least. Stewart concludes that fiscal rules are ‘frequently honoured in the breach’, such as when the 2008-2009 global recession causes many countries to breach rigid budget rules. Troublingly, she suggests that a result of this episode was less budget transparency, as some countries engaged in ‘creative accounting’ to conceal the breach.

The Australian
3 October 2022

Last year, academics from the University at Albany and the University of Missouri published a research paper arguing that company taxes should be abolished. Part of their argument was that transfer pricing by multinationals has become so widespread that policymakers should give up on corporate taxation altogether.

It’s a stark reminder that when it comes to multinational tax reform, what’s at stake is nothing less than the future of the corporate tax itself. I believe it is good economics to save corporate tax, but it will take deft policymaking and proper tax administration to do so.

Company taxes go back a over a century. The US introduced a corporate tax in 1898, but it was over-ruled by their Supreme Court a year later. In 1913, after they had sorted out their constitutional issues, the US company tax rate was set at a measly 1 percent.

Australia introduced our company tax in 1915. Then Attorney General and future Prime Minister Billy Hughes told parliament that it was “necessary to meet the great and growing liabilities created by the war”. Hughes put the issue bluntly: “I know of no other means whereby we could raise the necessary revenue.”

Today, while the essential purpose of corporate income tax remains the same, the challenges of collecting corporate taxes have grown enormously. Part of that arises because company taxes are simpler in an economy that makes physical products. Agriculture, mining and manufacturing have clear locations of production. But if a company’s output is digital, then it’s easier to artificially shift the location of production to the place with the lowest tax rate.

E&OE TRANSCRIPT
RADIO INTERVIEW
2GB MONEY NEWS
THURSDAY, 29 SEPTEMBER 2022 

LUKE GRANT (HOST): So back to our October budget and the balance between spending and saving. Of course, it's crucial. One man who's been a big part of the budget process unsurprisingly is the Assistant Minister for Competition Charities and Treasurer Andrew Leigh. Minister, welcome back to the show.

DR ANDREW LEIGH, ASSISTANT MINISTER FOR COMPETITION, CHARITIES AND TREASURY: Good to be with you.

GRANT: Nice to talk to you. Firstly, before we get to the budget, the government has just introduced legislation to crackdown on anti competitive behaviour and unfair contract terms. I note that the Small Business Ombudsman, Bruce Billson, has been effusive in his praise of the legislation. Can you take us through what's changing and how that's going to help small businesses operate, Minister?

LEIGH: Well, competition is a bedrock of a fair economy and we need competition to get better prices and more choice for Australian households. The government has been worried that too many big firms are starting to treat competition fines as just a cost of doing business, rather than a real deterrent to bad behaviour. So we're raising the maximum penalty from $10 million up to $50 million to make sure that big businesses do the right thing. And the other thing we're doing for small businesses is making unfair contract terms illegal. These are terms that are lopsided. So, for example, a big business might have a contract with a small supplier that says they can change the prices any time they like or they can get out of the contract anytime they like, although their smaller counterpart can't quit if they want to. So those unfair contract terms will now be illegal. There will be fines for putting those into contracts.

E&OE TRANSCRIPT
TELEVISION INTERVIEW
ABC AFTERNOON BRIEFING
THURSDAY, 29 SEPTEMBER 2022

GREG JENNETT (HOST): Well, we know full well that Australia's got an inflation problem at present, running at just under 7% and expected to sit at around that level for a little while. But we also now have a glimpse at more accurate data that tells us when that peak just might reach or be passed. Now, Competition and Charities Minister Andrew Leigh is responsible for the Bureau of Statistics, amongst other things, and he's with us now. Welcome back, Minister. This is a bit of a revolution, moving to monthly measurement. Why is more frequent measurement of inflation any more accurate or useful to governments, policy makers?

DR ANDREW LEIGH, ASSISTANT MINISTER FOR COMPETITION, CHARITIES AND TREASURY: Greg, it doesn't really matter at a time when inflation is low, as it's been for much of the past decade, but it really does matter at a time like the present, when we're trying to ensure that we get inflation under control. With the government is focusing on supply side reforms and the Reserve Bank focusing on demand side reforms, we really need that frequent updating. Australia has been an outlier in having only quarterly inflation figures. So full credit to David Gruen and his team at the ABS for bringing out these experimental monthly estimates.

JENNETT: So it's timely for the reasons you just outlined. We were going to get there anyway I think it's just that it's landed in a sweet spot. In what sense is it experimental? And how can we be certain that it is, in fact as accurate as the quarterly reporting?

LEIGH: Well, unlike other figures that the Bureau of Statistics brings out, the inflation number isn't revised, and that's because it's often locked into contracts, it has an immediate flow through to government payments and to business. And so all of those indexation measures will still continue to be based on the quarterly numbers for the time being. The Bureau needs to make sure that it's got those monthly figures right. But, Greg, it does show some interesting patterns across sectors. Over the last year, you've seen the price of new dwelling construction up 21%, fresh fruit and vegetables up 19%. Anyone who's been to the supermarket lately will know that one. And then you've got areas like communications, where prices are only up less than 2% over the last year. So some real divergence right across the economy.

Speech To The OECD Forum On Tax Administration
Thursday 29 September 2022 

Good morning, my name is Andrew Leigh and as Assistant Minister responsible for multinational tax, I am very pleased to have the opportunity to speak to you at this important forum.

I will begin by acknowledging the traditional owners of the land on which I am making my remarks from in Canberra, the Ngunnawal people, as well as where you are meeting today on the lands of the Gadigal people of the Eora Nation. I pay my respects to their elders past, present and emerging.

It’s a pleasure to be a part of this event supporting the Forum on Tax Administration’s work. The work of tax administrators is a crucial element of ensuring a well-functioning economy and a fair society.

As an Economics Professor, a lot of my work was in public finance, particularly at the intersection of taxation and inequality. I learned a great deal from my co-author Tony Atkinson, who worked across a large number of countries, drawing insights on big questions from looking at different nations. That’s one of the great strengths of the OECD: sharing ideas across countries in the interests of improving policies everywhere. If Tony Atkinson was still alive, I reckon he’d love to be joining your conference today, as he did with many other OECD events.