SKY NEWS FIRST EDITION
MONDAY, 9 SEPTEMBER 2019
Subjects: Cashless welfare card, mandatory drug testing for social security recipients, drug testing for politicians, the economy struggling under the government, the Morrison Government’s lack of plan for productivity.
LAURA JAYES: Let's go live now to Canberra. Joining me is Labor MP Andrew Leigh. Thanks so much for your time. Let's start on the cashless welfare card. Evidence has showed that it is working in some of these communities. Do you dispute that?
ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: Laura, all the evidence that I've read suggests that this card won't create a single additional job, and there's concerns that it has adverse impacts on financial management and Aboriginal peoples’ sense of autonomy. When it’s rolled out on a compulsory basis, which is where Labor has our chief concerns, this seems to have more adverse impacts than positive benefits.
JAYES: What's the evidence of those adverse impacts? You talk about autonomy but don’t, I suppose, people living on taxpayer funds, don’t they lose their right to autonomy?
LEIGH: It's a question as to how you can best help people find jobs. We have a situation now where unemployment rate is a full percentage point higher than it is in Britain or the United States or New Zealand, where we have parts of Australia where the unemployment rate is over 50 per cent. So you’ve got to look pragmatically at the evidence, whether that's the evidence from the Department of Social Services’ study, the evaluation done by the Australian National University, the evaluation done by the University of New South Wales. All of that body of evidence points towards this being a measure which will not create another additional job, and that's what we need now in a floundering economy. An economy in which wage growth has been too slow, productivity has been in the doldrums and we've now got growth the lowest level in a decade. We need policies that will boost growth-
JAYES: We’ll get to the economy in a minute. I just want to ask you about the drug testing of welfare recipients. Is there any chance Labor will lend its support in the Parliament to this?
LEIGH: We’ll look at the legislation when it comes before us. But frankly, you've got to wonder what some of the people in the ministerial wing have been smoking if they think that this is the way of boosting employment. We know right now that we have huge challenges with employment, with wages, and this again is a distraction from the core challenges that Australia faces.
JAYES: Well, if it perhaps those in the ministerial wing have been smoking something funny, do you think politicians should be drug tested? Would you be alright with that?
LEIGH: I'm perfectly relaxed about being drug tested. The question is whether these sorts of political games are what Australia needs at this dangerous time in the global economy. You've got the New York Fed’s recession indicator now sitting above one in three for the next 12 months. The yield curve has inverted. You've got gold prices up, bond yields way down. The cash rate is now the lowest that it's ever been, and the Reserve Bank is doing what it can in order to support demand. But the government is insisting on playing petty political games.
JAYES: Well, you're determined to talk about the economy so let's go there. Just a couple of months Labor went to an election promising hundreds of billions of dollars in new spending measures. Looking at these latest growth figures, does it show Labor needs to wind back some of those promises?
LEIGH: Laura, we believe in a fairer tax system and measures that Australia needs to support demand and to invest in the next generation. The problem right now is that the government has a tax plan for 2025, but not a tax plan for 2019. At a time in which growth is fragile, Jim Chalmers has been urging the government to bring forward the budget update and Anthony Albanese has been saying they should bring forward infrastructure spending-
JAYES: Knowing what you know now, Andrew Leigh, would it be prudent for Labor to spend as much as it was promising at the election?
LEIGH: Serious economists right now are calling for more spending in order to ensure that fiscal policy is aligned with monetary policy. But right now, you have this situation where the government is refusing to listen to the experts, refusing to put in place the appropriate supports that we need to make sure that the economy holds firm. Now we're having these really troubling retail sales figures. The new car sales figures are down. There's a range of red lights flashing, but the government isn't heeding those-
JAYES: Well, as an economist yourself-
LEIGH: You’ve got the Reserve Bank and the government really at odds right now.
JAYES: So are you advocating for Labor to spend more than it promised at the election? Because these figures are a lot worse than what we thought a couple of months ago.
LEIGH: I think what we need is a bring forward of infrastructure spending. We know that the construction sector is the most cyclical sector, and so when you go into a downturn, it's construction that is first hurt. So bringing forward shovel ready infrastructure projects - as the Reserve Bank of has been urging, as Anthony Albanese has been making the case for - would be prudent fiscal policy right now. But more than that, it's good for the long run. When you invest in infrastructure projects the nation needs, you're able to cut commuting times, which we know from the HILDA survey recently have been going up markedly. Too many Australians are spending too long sitting in their cars. More infrastructure spending can deal with that, as well as supporting demand at a fragile time for the world economy.
JAYES: Ok. Labor, there’s a suggestion it might keep its policies under wraps until 2022. Why?
LEIGH: You wouldn't expect us to take the same set of policies to the 2022 election as we did at the 2019 election-
JAYES: Well, that not clear at the moment, is it Dr Leigh?
LEIGH: It is absolutely clear that we will not take a carbon copy of last election’s policies-
JAYES: Well, what are you going to drop out?
LEIGH: We'll take our time to engage, to listen. We've got Jay Weatherill and Craig Emerson conducting this important review. We're out there - the Small Business Roadshow has been out, travelling the country. I've spent time in communities around the Kimberley, speaking to people about the sorts of policies that they need, and of course in my own electorate in the ACT. We’ll be an opposition which listens and learns and forms policies that are right for 2022 when the next election comes around.
JAYES: So when might we see this?
LEIGH: You can expect policies to roll out as usual through the course of the term-
JAYES: What does as usual mean, Dr Leigh? I don’t think we’re in usual territory, are we?
LEIGH: It’s certainly true, Laura, but the role of an opposition is twofold - to hold the government to account and to produce alternative policy ideas. We’ll produce more of those alternative policy ideas as we come towards the next election. I know our political opponents want to nail us to the mast, get us to immediately recommit to the suite of policies we took to the last election. We won't do that. We’ll engage calmly and methodically with the business community, the union movement, the community sector, talking about the policies the nation needs. Right now for example, we're calling on the bring forward infrastructure spending and a real productivity plan. This productivity problem has been languishing for years and the government really has no strategy to invest in institutions, individuals and infrastructure, which is what Labor believes is needed in the productivity space.
JAYES: Well, no carbon copy. Appreciate your time this morning, we’ll speak to you soon.
LEIGH: Thanks, Laura.
Authorised by Paul Erickson, ALP, Canberra.