Tax Forum Submission

I'm attending the government's Tax Forum in Canberra on 4-5 October. Participants have been asked to supply a Statement of Priorities. Here's mine:
Tax Forum - Statement of Priorities
Andrew Leigh MP

A wide range of participants have been invited to the Tax Forum, and we can expect that many diverse ideas will be brought to the table. This statement aims to set out some of the guiding principles that should be at the heart of tax reform in Australia.

In the last parliamentary term, the Australian Government commissioned a major review of the Australian tax system, the first in a generation. The 2009 Australia’s Future Tax System report (‘the Henry Review’) is a seminal document, which outlines the core principles that should be at the centre of tax reform.

As a nation, we need to identify the opportunities and challenges facing us and then target reforms to meet them. The Australian Government has identified the mining boom and climate change as major issues that require tax reform. We have introduced the Clean Energy Future legislation into parliament, and will soon be introducing legislation for a Minerals Resource Rent Tax.

Among the core principles for taxation reform are the following:

  1. Taxes should be shifted away from mobile tax bases to immobile tax bases.

  2. Taxation of savings should be more neutral and sustainable.

  3. Polluters should internalise the social cost of environmental damage.

  4. Disincentives to labour force participation should be reduced.

  5. The tax system should be as simple as possible.

The Australian Government is already acting on these priorities. For example:

  • we are shifting the tax burden from mobile to immobile tax bases by cutting business investment taxes and introducing a mining tax;

  • we are ensuring more neutrality and sustainability in savings decisions by increasing the compulsory superannuation contribution rate, increasing the incentive for low-income earners to contribute to superannuation, and cutting the tax rate on interest earnings;

  • we are ensuring that polluters internalise the social cost of environmental damage by implementing a carbon price, and reforming the Fringe Benefits Tax regime on cars in order to remove the incentive to drive excess kilometres;

  • we are reducing disincentives to labour force participation by phasing out the dependent spouse tax offset, making income tests more generous for single parents and introducing a pensioner work bonus; and

  • we are simplifying the tax system by tripling the tax free threshold and replacing the ineffective entrepreneurs’ tax offset with more straightforward measures such as an improved instant asset write-off.

The tax forum is a valuable chance to continue a national conversation about tax reform. That conversation takes place at a time when Australia’s economic fundamentals are among the best in the world. Our unemployment rate is around half the level of the United States and the European Union, and government debt is a small fraction of that in most developed nations. Australia’s geography has us in the fastest-growing region of the world, and demand for our exports is higher than it has been for a century. Not everyone is sharing in the benefits of the boom, but as a nation, we approach the task of reform from a position of strength.

I look forward to engaging in this discussion, guided by the principles outlined above.

Other submissions will soon be published on the Tax Forum website.
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Sky News AM Agenda with Andrew Leigh and Mitch Fifield

Ashleigh Gillon hosted Mitch Fifield and I on the AM Agenda program on Sky News yesterday.
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In praise of public sector workers

I spoke in parliament yesterday about the important role played by public sector workers - particularly teachers and public servants.
House of Representatives, 12 September 2011

I rise to speak in praise of public sector workers in the ACT and throughout Australia. It was my pleasure recently to attend a roundtable event hosted by Slater and Gordon Canberra and the Centre for Policy Development, to discuss a new report by the CPD authored by James Whelan, and commissioned by Miriam Lyons, CPD’s executive director. The report, titled The state of the Australian Public Service: an alternative report, is an insightful analysis of the role that the Australian Public Service plays today. It notes that the Australian Public Service's employment - currently 163,778 people as at the end of 30 December 2010 - lies somewhere between the number of people employed in Coles and the number of people employed in Woolworths.

The report discusses, in a real broad sweep of history way, how the Australian Public Service has developed and some of the major challenges currently facing it. Its findings would make interesting reading, I imagine, for the member for North Sydney, who has repeatedly claimed that the increase in public servant numbers since Labor came to office has been 20,000. The member for North Sydney continues to sprout this figure despite having been repeatedly corrected by the Special Minister of State for the Public Service and Integrity. As the minister has pointed out, the change in Australian Public Service numbers since this government came to office has been 8,355, rather than 20,000. But it is not these inaccuracies that most worry my constituents; it is the repeated promise from the member for North Sydney to slash 12,000 public service jobs out of Canberra. This lies in contrast to the views of those from the Centre for Policy Development.

The Centre for Policy Development Research has delved into a range of important issues for the Public Service. For example, it tabulates the Australian Public Service retrenchments since 1995. When one looks at that graph, a clear spike stands out. That is in the years 1997, 1998 and 1999. Australian Public Service retrenchments in no other year exceed 4,000 but in those three years the annual retrenchments were 10,070, 10,238 and 9,061 respectively. It is very clear what happens to numbers in the Australian Public Service when a coalition government comes to office. They are slashed.

The report also focuses on the role that the Big Society reforms are having in the United Kingdom. The report notes:

'The Coalition's desire to reduce the size and cost of the Australian Public Service taps into 'small government' movements that have been prevalent here and in other western countries since at least the 1970s. The values, vision and policies of these movements are currently expressed by the Tea Party in the United States and 'Big Society' in the United Kingdom.'

You can see a clear contrast of values in the report. For example, the member for Fadden has told parliament:

'I want the government to be small, I want the public service reduced.'

The member for Wannon has said:

'… the government needs to put a freeze on Public Service recruitment.'

But not all of those opposite take this simplistic view to the Public Service. The member for Wentworth says:

'Squeezing public servants probably appeals to some people. I think the critical thing is to ensure that Government delivers its services efficiently at every level but you've just have to be smart about it.'

The member for Kennedy says:

'They have done a good job and their Public Service has done a good job.'

Those are words that I commend to this House.

It is important that we continue to recognise the great work occurring in the Public Service. Nicholas Gruen's Government 2.0 report suggests some ways in which innovation could be rewarded, including the novel notion of a policy idol competition. When I was in the United States I was privileged to be a judge for the ‘Innovations in American Government’ awards that are run annually to recognise innovation within local, state and federal government. There are also major challenges in this sector. One of the challenges noted by James Whelan's report is increasing the share of Indigenous workers and the share of workers with a disability in an Australian Public Service where recruitment now typically starts at the APS 3 level or above.

We need to recognise that public servants are critical to the quality of service delivery. One of the reasons that Australia avoided the global financial crisis was the rapid fiscal stimulus put in place thanks to the work of the Treasury, the Australian Taxation Office and Centrelink. On this 10th anniversary of September 11, it is worth remembering that on that fateful day it was the government workers who were running up the stairs. And when the Queensland floods hit earlier this year, the Minister for Human Services noted the tragic death of Centrelink worker Gillian Harman who spent a month volunteering in flood hit Queensland in Dalby. As the minister said, Ms Harman returned home on Sunday night. She went straight back to work in her Centrelink office in Guyra in northern New South Wales on Monday and tragically was killed on Monday going home from the office. It is this sort of dedication to work of the Public Service that we on this side of the House recognise.

Public sector workers more broadly benefit from the representation of their unions. I pay tribute to the CPSU, the AEU, the ASU, the ANEF, United Voice, the UFU and the Police Federation among others for the work they do every day in representing public sector workers.

Finally, I would like to turn to another type of public sector workers and pay tribute to the many teachers in the electorate of Fraser who day in, day out do work that is enormously valuable; which inspires the next generation of Canberrans to learn and to understand the world around them.

I also want to pay tribute to the Teach for Australia program. I had the pleasure recently of having dinner in Canberra with, and speaking in Melbourne to, Teach for Australia associates, as they are known—the new teachers who teach in the classroom. I would like to thank Melodie Potts-Rosevear for giving me that opportunity. Teach for Australia is an extraordinarily selective program. In 2009, over 750 applications were received for only 50 places. Of those selected for the program, the average UAI/ENTER score was 97. This selective program means that Teach for Australia associates are placed into classrooms after an intensive pre-placement education and then teach for two years in disadvantaged schools while they continue to complete their education through a two-year postgraduate diploma of teaching at the Melbourne Graduate School of Education at the University of Melbourne. This program has built on the success of similar programs in the United States and the United Kingdom and works to get as many talented people as we can into the classroom. Not all teachers will be Teach for Australia associates, but it is another flexible pathway into teaching.

I acknowledge in particular to the Teach for Australia teachers who have been working hard in the ACT this year: Lia van den Bosch at Hawker College, Imogen Byrne at Belconnen High, Corey McCann and Igraine Ridley-Smith at Calwell High, and Felicity Oliver at Erindale College. In the ACT, we are grateful to them for joining the teaching workforce and for working alongside the many great teachers who enrich the lives of young Canberrans every day. I know that this is not always an easy job. I know that walking into the classroom when you are tired, when the kids are not always behaving at their best, can be a challenge, but it is essential work for the future of our nation and I pay tribute to the many teachers who do it every day.
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Community Organisations

I spoke in parliament today about Canberra's community organisations (with special mention of the Canberra Times fun run and Hall village).
Community Organisations
12 September 2011

There are many reasons to love this fine city of Canberra, but the No. 1 reason from my standpoint is its social connectedness. Canberra is a place to enjoy the simple pleasures of sharing time with friends and neighbours, working together in clubs, groups and associations and strengthening the social ties that bind us together. All of this, what academics have called social capital, is the idea that the ties that bind us together have an inherent value. When it was first introduced it was a bit controversial, much as the idea of human capital, that the skills that people have could have an economic value.

But, just as we have come to recognise that people's skills and education have value, like a bridge or a road does, increasingly we are recognising that social capital, the ties that bind us together, are economically important. They are important not only because they are fun but because they make businesses work better. The more you trust the person who is supplying the goods to your business, the less you have to have a contract that writes everything down in case something goes wrong. The bonds of social capital, the networks of trust and reciprocity, exist between two friends who meet for a beer on Friday night. They link together the members of a local cricket team, who know that the more they trust one another the more games they are going to win. And they link together, co-workers who find that working together gets the job done faster. From the year 2000, when I first came across Robert Putnam, the author in the US of Bowling Alone, until last year I was working on a project looking at social capital in Australia, the strength of community ties. The material was eventually published in a book by UNSW Press called Disconnected. The more data I collected the clearer it was to me that we knew what was going on.

In terms of organisational membership, surveys of Australians show we are less likely to be active members of an organisation than our counterparts were in the 1960s. Organisations themselves have gone out of business. There are fewer associations today in Australia than there were in the late 1970s despite a big increase in the number of people in the country. The average age of members of organisations has also risen. This is also because existing organisations have shed members. When I pulled together as much membership data as I could from bodies like Scouts, Guides, Rotary and Lions, I saw that the mass membership of organisations peaked as a share of the population in the late 1960s and has declined markedly since then.

As to people giving their time, Australia saw a rise in the share of people volunteering in the late 1990s—maybe an Olympic effect—but volunteering rates are probably still below their post-war peak. And the proportion of us who give any money to charity has stayed pretty stable over recent decades despite a substantial increase in average income.

On the matter of informal socialising, Randall Pearce of Ipsos Mackay was kind enough to field the same question to a group of Australians in the 2000s that had been put in 1984 when people were asked about the number of close friends they had and the number of neighbours they could rely on. Even on that measure too social capital had declined. The respondents in the 2000s had shed two friends who would keep a confidence, and half a friend who would help them through a difficult patch. Compared to respondents two decades earlier, the typical Australian in the 2000s has one and a half fewer neighbours of whom they can ask a small favour and three fewer neighbours they could drop in on uninvited. We are also more likely to live alone.

I am pleased to inform the House that in Canberra, although our community strength is probably below what it was, we are the most active in a civic sense in Australia. A cornerstone of social connectedness in Canberra is the community of Hall, and there the Hall Progress Association is a critical organisation. When the original boundary was drawn for the then Federal Capital Territory, the direct line from Mount Coree to One Tree Hill took in the village of Hall. Since its official proclamation in 1882, the village of Hall has had a long and rich history of community engagement and civic spirit. The Hall Progress Association, formed in 190, has been meeting and working for the development of Hall and its residents for 110 years.

I recently had the privilege of meeting current members of the association to learn about local matters of interest. Over coffee at the general store, first opened in 1889 and still a hub in the community, I was told of the vision the association has for preserving the historic value of Hall, making it a great place for families and having an eye always firmly to the future.

One idea that we talked about over a terrific coffee, was the establishment of Hall as a 'green village', where solar power generation can meet the energy needs of Hall's 350 residents and, through the retrofitting of sustainable systems for energy, water, waste and landscape management, provide a demonstration case for other communities.

In the face of declining social capital, Canberra and the community of Hall are working strongly to maintain and build social networks. I would like to commend the Hall Progress Association for the role it plays in the process, particularly Bob Richardson, Helen White, Alastair Crombie, John Starr, Phil Robson, Paul Porteous and Trudy Mansfield for their hospitality, enthusiasm, energy and dedication to the Hall community.

I am proud to say that you see a lot of community spirit in the rest of Canberra. On virtually every social capital measure, Canberra is at or near the top. Compared to other states and territories we have got the highest share of charitable donors and the highest volunteering rate. If any Canberran listening to or reading this would like to be recognised for their volunteering we have even got volunteering awards on at the moment. Eighty-five per cent of Canberrans give money to causes in a given year, compared to 73 per cent in New South Wales, the next closest jurisdiction. In terms of giving time, 38 per cent of Canberrans volunteer in a given year compared with 33 per cent of Victorians, the next closest. In terms of sporting events, 47 per cent of Canberrans attended a sporting event in the previous year, compared to 44 per cent nationally, and 41 per cent of Canberrans actually take the field, by playing organised sport, compared to only 30 per cent in the rest of Australia. On the cultural front, Canberrans are twice as likely to attend an art gallery or a museum than other Australians. They are more likely to go to the movies and more likely to go for a stroll around the National Botanic Gardens. They can cheer for the Raiders, the Brumbies, the Capitals and the Prime Minister's XI. They can see Alfred Deakin's portrait in the Museum of Australian Democracy and Ned Kelly's death mask at the National Portrait Gallery. They can enjoy a cool stroll through the Botanic Gardens.

Canberra's community organisations may not have the same level of exposure as its well-known national institutions, but the role they play in building social capital is just as valuable. Community organisations are an integral part of the fabric that forms social capital. They bring together a wide cross-section of members of the community. They build networks of trust and reciprocity, and they link together individuals from diverse backgrounds. It is one of the reasons that living in Canberra is such an enjoyable experience and why so many people from throughout Australia choose to come to our city for work or to study. Community organisations lend a helping hand to help people newly arrived in Canberra. They help new residents connect to established members of the community.

In closing, I would like to acknowledge Jessica Woodall, an intern in my office who is working with me for the week. I pay tribute to her favourite community group, the Peregian Beach community school. I would like to acknowledge Alisha White, an Indigenous intern from Airds High School, whose favourite community group is the Iragmga Dance Group, and Damien Hickman, an adviser in my office. His favourite community group is ACT Veterans Rugby, which works to raise money for Clare Holland House, an activity that I am sure makes his wife, Kate, and his daughter Liesel greatly proud. I would also like to pay tribute to ACT volunteers: those who care for people with a disability; who help out at the school tuckshop; who assist refugees, such as the organisation Companion House does; or who campaign on issues that matter to them, like the Australian Youth Climate Coalition does.

Yesterday I enjoyed competing in the Canberra Times Fun Run to raise money for the Heart Foundation. My staffers Gus Little, Louise Crossman, Damien Hickman, Lyndell Tutty, Ruth Stanfield and Claire Daly all joined me, and they were willing to put their pride aside and all wear an 'Andrew Leigh—Supporting Our Community' t-shirt for the run. I thank them for being part of a terrific community event and for their role in raising money for the Heart Foundation. On a gorgeous Canberra spring day we ran down Adelaide Avenue, looking up at Parliament House and recognising what a wonderful city this is, how lucky we are to live in it and how terrific our community organisations are in building the social fabric of Canberra.
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Find your lost superannuation

Member for Ginninderra, Dr Chris Bourke MLA, and I yesterday launched a local campaign to help our constituents find their lost super.

According to a national survey, people living in the Belconnen suburbs covered by the 2615 postcode such as Charnwood, Holt and Spence are owed more than $45 million so the campaign will concentrate on those areas.

Dr Bourke and I will hold a series of mobile offices in local shopping centres to show constituents just how easy it is to find their lost superannuation accounts and combine them into one.

If you need help finding your lost superannuation, please contact my office on 6247 4396 or come and speak to us at a mobile office.
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Talking International Economics on ABC24

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National Volunteer Awards

There are some parts of being a Federal MP that are incredibly rewarding. One of those is the ability to recognise local volunteers for their hard work out in the community. Today, Kate Lundy, Gai Brodtmann and I announced with Volunteering ACT the opening of nominations for the ACT's National Volunteer Awards. The National Volunteer Awards are a part of the 10th anniversary of the International Year of Volunteers activities. If you're familiar with my work before entering the Australian Parliament, you'll know that volunteering is something that I'm very passionate about.

If you know a local volunteer individual or group I encourage you to go to the Volunteering ACT website from tomorrow to put in a nomination. Details on award categories and how to nominate are in the media release below.

Member for Fraser Andrew Leigh, Member for Canberra Gai Brodtmann and Senator for the ACT Senator Kate Lundy today announced the launch of the National Volunteer Awards in conjunction with Volunteering ACT.

Volunteers will be able to nominate, or be nominated for, awards in the following categories:

1. Individual Volunteer Award
2. Team Volunteer Award
3. Young Volunteer Award (under 25)
4. Corporate Volunteer Award
5. Long – Term Volunteer Commitment Award
6. Innovation in Volunteering Award
7. New Organisation or Volunteer Program Award
8. Emergency Management Volunteer Award
9. Education Volunteer Award
10. Environment Volunteer Award

“Volunteering is an important part of the social fabric of Australia,” said Andrew Leigh.

“Most volunteers participate to give back to their community and we thought it was time we publicly recognised the contribution made by volunteers.”

The National Volunteer Awards are an initiative of the Gillard Government to recognise individuals who contribute to their local communities.

“2011 is the tenth anniversary of the International Year of Volunteers,” said Senator Lundy.

“The theme for the world- wide celebrations is ‘Inspire the Volunteer in You’ – recognising that everyone can be a volunteer and make a valuable contribution to their community.”

Nominations open tomorrow and will close on 21 October 2011. Nomination forms are available from the Volunteering ACT website:

“I encourage all Canberrans to nominate the hard-working volunteers that they know for an award,” said Gai Brodtmann.

“We look forward to seeing all of the different types of contributions that people are making to the Canberra community”.

The awards will be handed out at a ceremony on International Day of the Volunteer, 5 December 2011.

“Volunteering ACT is pleased to host the event for these awards on the International Day of Volunteers” said Maureen Cane, Chief Executive Officer of Volunteering ACT.
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A Mess, But No Messiah

My AFR column today is on the myth that WorkChoices was good for productivity. I conclude with a few ideas about what we might do to raise productivity.
End Work Choices Myth, Australian Financial Review, 6 September 2011

In Monty Python’s The Life of Brian, a man is accidentally mistaken for the messiah. Despite all facts to the contrary, he is unable to persuade his devoted followers that he is not divine.

And so it is with WorkChoices. Over recent months, a steady drumbeat has been sounding through the Coalition and more extreme elements of the business community, claiming that a return to the industrial relations system that existed from 2006 to 2009 would boost productivity in Australia.

Alas, there’s precious little evidence to back this up. Productivity growth in Australia peaked in the early-2000s, and has been significantly lower in the naughties than it was in the nineties. If WorkChoices boosted productivity, you might have expected that Australia’s productivity would have soared in the period 2006-2009. But the opposite is true. In the WorkChoices era, labour productivity growth rates were lower than any 3-year period in recent times.

In a pair of papers presented to the Reserve Bank’s annual policy conference in August, these results were confirmed. In a splendid analysis of productivity, the Grattan Institute’s Saul Eslake concludes: ‘In particular, the workplace relations reforms introduced by the Howard Government under the title ‘WorkChoices’ in its last term in office were not, primarily, ‘productivity-enhancing’.’

The same holds true of unemployment. Looking at the jobless rate that prevails at a given level of inflation (the so-called ‘Phillips Curve’), Melbourne University’s Jeff Borland finds no evidence that WorkChoices reduced the unemployment rate.

None of this should have come as a surprise. Most of the WorkChoices package was not about labour market deregulation, but increasing the industrial relations power of the federal government and shifting the power balance from workers to employers (eg. by abolishing the no-disadvantage test and restricting union rights). Removing dismissals protection from small businesses greatly raised the chance of employees being treated unfairly, since small firms are least likely to have proper human resources processes.

Even when the Howard Government introduced the WorkChoices package, it struggled to provide evidence for its productivity-enhancing effects. In the Explanatory Memorandum, then-minister Kevin Andrews included a graph showing a negative relationship between an industry’s productivity growth from 1990-2004 and its award coverage rate in 2004. As Griffith University’s David Peetz pointed out, such an analysis only makes sense if time runs backwards. When Peetz used a measure of award coverage from an earlier year, the relationship falls apart.

But just because WorkChoices isn’t the answer, it doesn’t mean that the question isn’t important. In his study of productivity, Eslake notes that Australia’s productivity slowdown has been broadly-based, affecting most industries. He points out that Australian firms are less likely to introduce product innovations than companies in Japan, the US and the EU, and that many large Australian firms do not even bother to measure their productivity.

Among his favoured solutions, Eslake includes regulatory reform (eg. more competition in the pharmacy, newsagency and taxi markets) and tax reform (eg. removing tax loopholes and reforming inefficient state taxes such as stamp duty). He might also have mentioned policies to reduce congestion, which operates like a tax whose revenues are dumped into the ocean.

In my view, the most promising productivity-boosting reforms are in the area of education. With test scores having flatlined since the 1960s, it is vital to find ways of making our schools work better. Publishing test scores on the MySchool website, funding reforms in low-SES schools, and creating a system of teacher performance pay are among the promising policies that the Gillard Government is putting in place to raise school quality.

Alongside this, we need to increase the quantity of education that young Australians receive: through a higher school leaving age, more in-school trades training, and a demand-driven university system. Education reforms will take some years to affect productivity, but in the long-run, their value is likely to be higher than other productivity reforms.

Lastly, it’s important that more Australians have the chance to participate in the labour market. For example, we’re updating the disability impairment tables, and requiring that people try finding work before they sign up for the Disability Support Pension. Policies like this won’t raise average productivity (in fact, they’ll probably lower it a smidgin), but they’re unambiguously the right thing to do.

So by all means, let’s continue the national debate about productivity, but let’s drop the myth that WorkChoices will be the salvation all our productivity problems. As Brian’s mother finally tells the crowd: ‘e’s not the Messiah – e’s a very naughty boy’.

Andrew Leigh is the federal member for Fraser.

Thanks to the parliamentary library for research assistance on this issue. They also have useful chronologies of Fair Work and Work Choices.
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Capital Hill 30 August 2011 with Stuart Robert

Lyndal Curtis hosted Stuart Robert and me on the Capital Hill program yesterday evening, discussing a range of political issues. Topics included support for the manufacturing industry and the plan to put a price on pollution.
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Sky AM Agenda with Mitch Fifield (29 Aug)

Transcript below (thanks to Mitch's team for transcribing).

Joining me this morning is Labor MP Andrew Leigh and the Liberal Senator Mitch Fifield. Good morning to you both. Andrew, let’s start with you. You would have heard John Lloyd’s views on the need for an overhaul of the Fair Work Laws. Is the Government open to that sort of criticism?


Ashleigh, we’ve had some pretty big reforms over recent years; getting rid of the WorkChoices regime which saw Australian workers have pay and conditions cut, moving to a much more reasonable process through Fair Work Australia which gets the balance right. It’s not surprising that there’s sections of the Liberal Party and extreme elements of the business community that want to get rid of penalty rates and want to go back to the bad old days but there’s absolutely no evidence that that boosted productivity. The productivity slowdown started about the year 2000 and indeed accelerated under the WorkChoices regime. In fact the Reserve Bank’s own conference last week had people presenting papers saying that WorkChoices did nothing for productivity.


Mitch Fifield, do you agree with the views that we heard put forward by John a short time ago, and why isn’t the Opposition making more of this issue, especially now that you appear to have people like Glenn Stevens onside? Is the Coalition still too scared of touching anything that could remind Australians of WorkChoices?


John Lloyd is an astute observer of the industrial relations landscape, and he is reflecting concern in the business community about the fact that productivity has been trailing off. Now I should say, Ashleigh, lest there be any hysteria, that after the 2007 election, the Coalition got the message from the Australian public, and as a result, WorkChoices is dead. But that’s not to say that the Labor Government have found some sort of industrial perfection. They themselves have undertaken to have a review of their workplace laws. We think that review should come forward. There’s no problem - there shouldn’t be an issue — with actually asking questions. I was astounded by the absolute tirade against Glenn Stevens from his evidence last week where he simply said that it would be good for employers and employees to get their heads together to see if there are ways that productivity can be lifted. We will be taking an industrial relations policy to the next election. It won’t be radical. It won’t be ideological. It will be a practical policy that seeks to respond to concerns expressed by both employers and employees.


Today Julia Gillard is going to be meeting with a couple of unions over the future of the manufacturing sector. She’ll also be having a meeting with an industry group leader to talk about how to go forward. We’ve seen some calls from unions about the need for the manufacturing sector to be more supported. There is a Buy Australia campaign underway to try to encourage Australian businesses to support the manufacturing sector. They’d also like to see an inquiry into how the manufacturing sector is travelling. Andrew Leigh, are you expecting that that will be a likely outcome of today’s meeting?


Ashleigh it’s very clear that when you’ve got a high Australian dollar, the result of record commodity prices, that puts pressure on other sectors, it puts pressure on manufacturing as it does on domestic tourism and universities that rely on overseas students. But we’re committed to a sensible package of assistance in that area. We’ve got a steel transition plan, we’ve got automotive assistance amounting to half a billion dollars. And I have to make clear Ashleigh, these are both policies that are opposed by the Liberal and National Parties. They’re going to vote against the steel transition plan, and they want to scrap automotive assistance. So while we’re focussing on getting the fiscal settings right, the Coalition are out there wanting to rip away that assistance and to rip away the protections. Mitch talks about no one wanting to go back, but backbencher John Alexander has been out in his own electorate calling for scrapping of penalty rates, and so it’s pretty clear that there’s pressure within the Liberal and National Parties to go back to the bad old days of industrial relations. Can I just make one more…


Let’s get Mitch’s view on this. Mitch, we heard the criticisms from Andrew Leigh about how the Opposition might handle this sort of crisis in the manufacturing sector. The Government was quick to come up with those assistance packages last week. What would the Coalition like the Government to do? Does it need to go further in any aspect in your view?


It does need to go further. What it needs to do is to abandon the carbon tax. The carbon tax is the single greatest threat to Australian manufacturing and Australian businesses. I was meeting with a manufacturer the other week who said that his electricity bills were going to go up by $120,000 a year. What that represents is a couple of jobs. So the Government need to abandon the carbon tax. The other great threat to manufacturing in Australia is the formal governing alliance between the Labor Party and the Australian Greens. The Australian Greens have a stated policy to de-industrialise Australia. How can the current Government say that they’re committed to supporting manufacturers when they’re in a governing alliance with the Australian Greens? That is just absolutely nonsensical.


OK. We are going to keep you informed if anything comes out of that meeting with Julia Gillard and the union leaders. We’ll keep you updated on developments. I do want to move on to the Courier-Mail/Galaxy Poll that we’ve seen today. It shows that if an election was held now, Kevin Rudd would be the only Labor MP standing. On a 2-party preferred basis, Labor dropped four points down to 37%, that compares to the Coalition’s vote riding high at 63%. Andrew Leigh, these sorts of figures, you’ve seen them before. There was a hope within the Party that once the details of the carbon tax were released that these polls would start to turn around, but we’re not seeing it.


Ashleigh let me give you the answer I will always give you if you ask me about polls — that is that polls two years out from an election have no predictive power. It’s a waste of time — politicians getting engaged, and frankly the public debate should be….


That doesn’t mean that you don’t pay attention to them, Andrew. Let’s be real here.


It really does Ashleigh. It actually does. What I’m focussed on is reforms that make a difference to my constituents. Putting a price on carbon pollution is absolutely essential. Australians put out more carbon pollution per head than any other country in the world including the United States. So if we’re the last country to act on climate change, we’re the ones that are going to have to make the fast transition. This is a sensible package of reforms backed by every serious economist in the country. And we’re doing that because we recognise that moving to low carbon Australia means more of those manufacturing jobs are in the clean technology industry. There’s jobs like that being trained up in my own electorate, we have a clean energy hub at the Canberra Institute of Technology. And so there’s a whole range of those new, clean tech manufacturing jobs that we’re out there trying to move Australia towards.


Well Tony Abbott is riding high in the polls but he does have his own set of problems. Over the weekend we learned that Tony Windsor said that in those conversations and negotiations he had with Mr Abbott after the last election, he said that Mr Abbott said he’d be willing to sell his backside to win government. That’s something that Mr Abbott denied yesterday — have a listen:

TONY ABBOTT (file footage):

I don’t speak like that. People who know me know that I don’t speak like that. Sure, after the election I wanted to secure government because I wanted to save our country from what was already a bad government. I think what we’ve seen has vindicated my judgement — this is a bad government getting worse.


On top of that today the Canberra Times is reporting that there’s Coalition angst about Mr Abbott’s attitude. Apparently, according to this report and sources within the Coalition, Mr Abbott has little trust of his frontbench and is paranoid about being doublecrossed. Apparently he’s making too many unilateral decisions. Some colleagues are apparently worried that he’s jumping too much on the populist stuff even if it is contrary to Coalition policy. Mitch Fifield, are they fears and concerns you’re hearing much among your colleagues?


Not at all. I haven’t seen that report but it sounds like complete rot to me. Tony has an open door policy with his colleagues. I never have any difficulty getting to see Tony and to talk about policy. In fact, it’s usually Tony who’s on the other end of the phone asking me for my thoughts. He’s a very inclusive leader, he has the full support of his colleagues and it’s just a bizarre report.


OK Mitch Fifield and Andrew Leigh , we are out of time. Thanks for joining us.


Thanks Ashleigh, thanks Mitch.


Thanks Ashleigh.

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Cnr Gungahlin Pl and Efkarpidis Street, Gungahlin ACT 2912 | 02 6247 4396 | [email protected] | Authorised by A. Leigh MP, Australian Labor Party (ACT Branch), Canberra.