Andrew Leigh

MEDIA RELEASE

Liberals must use Budget Reply to be upfront about cuts hurting Canberra

ACT Senator Kate Lundy, Member for Canberra Gai Brodtmann and Member for Fraser Andrew Leigh are calling on Tony Abbott and Joe Hockey to be upfront about any planned cuts on Canberra in the Opposition’s formal budget reply on Thursday.

With only one day until the budget reply speech to Parliament, they are calling on the Coalition to use this unique opportunity to make clear their plans for Canberra.

The Coalition has already proposed a number of cuts that would hurt local workers and families, including:

• At least 20,000 jobs from the public service in Canberra


• Household assistance payments typically worth over $1000 a year to local families


• The School Kids Bonus – used by 14,000 local families in our electorate


• The Instant Asset Write Off that 34,100 of small businesses in our electorate are eligible to use if they purchase new equipment


• The re-introduction of a 15% superannuation tax on 46,500 of Canberra workers earning below $37,000.  This is worth up to $500 a year to their retirement savings.


• Labor’s fibre to the home NBN now confirmed for roll out in the suburbs of the Inner North and Gungahlin, and the whole of Canberra within 3 years.  The Coalition will make people pay up to $5,000 to get optic fibre all the way to the premises

Given the Coalition’s track record, ACT Labor representatives are concerned the Coalition may also cut:

• The Income Support Bonus payments going to 9321 people in Canberra.  Payments of $210 per year for singles, and $350 to couples – the next payments are scheduled for a week after the election.  The Coalition voted against this cost-of-living help only a few months ago in Parliament.


• The Fair Entitlements Guarantee scheme that supports workers who would otherwise lose entitlements if their employer goes bankrupt or into liquidation.  Since 2007, 829 local workers have received $8,699,566.73 in entitlements under this scheme

If these concerns about possible cuts are unfounded, then Tony Abbott should use his Budget reply on Thursday to make absolutely clear that he will not take the axe to these programs if elected.

If Tony Abbott is going to be honest and upfront with our community, he needs to assure us that important help for local families and communities won’t face the axe.

If he is not prepared to give that assurance, then he must clarify what is on the chopping block.

Canberra deserves detailed candour in Thursday evening’s budget reply so voters can make an informed choice on 14 September.

Labor have been absolutely clear about our future investment and spending plans – it is there for all to see in Tuesday’s budget.

MEDIA RELEASE

ANU to receive $3 million endowment to establish Tax Studies Institute

Dr Andrew Leigh, Federal Member for Fraser and former professor at the Australian National University has welcomed the establishment of the Tax Studies Institute (TSI) at the ANU.

As part of last night’s Budget, the Labor Government will provide a $3 million endowment to establish the TSI with ANU providing additional support and funding worth $750,000 each year plus $500,000 upfront.

With plans to establish the Institute in 2013, the TSI will help raise the quality of national debate on tax reform and the awareness of taxation policy issues.

The TSI will be a centre of excellence which will collaborate with academics and institutions across Australia and overseas. A new Chair in tax policy, to be taken up by an internationally renowned tax and public finance expert, will direct the new institute.

Member for Fraser, Dr Andrew Leigh said that continuing the national debate on ways to reform our tax and transfer system will help position Australia for the challenges and opportunities of the 21^st Century.

“Labor has delivered a budget that will make Australia a stronger, smarter and fairer country,” said Dr Leigh.

“It’s very fitting that the Tax Studies Institute be placed at the Australian National University given the reasons why ANU came into being in the first place,

“The Crawford School is fast gaining an excellent reputation not only in Australia, but in our region too. It’s fantastic to see an Institute that will play such an important role in future policy housed in one of Australia’s most prestigious and fast growing schools,” said Dr Leigh.

TRANSCRIPT – POST BUDGET REMARKS - DOORS
Andrew Leigh MP
Parliamentary Secretary to the Prime Minister
Member for Fraser
15 May 2013

TOPICS:               The Budget



Andrew Leigh: The Budget that was handed down last night lays the framework for what will be a very clear choice for Australians come September. A choice between a Labor Government that’s chosen to make responsible saves in order to invest in road infrastructure, in better schools and in disability care, and the Coalition which must either back in all of our responsible saves and then make more cuts of their own, or else, keep their cuts in the top drawer as they’ve been continuing to do. I think Australians will recognise that the high dollar has been a big hit to the government revenues and they will recognise too, that it is time for Tony Abbott to stop saying yes to every special interest and no to responsible savings measures, back in the Government’s saves and then be clear about how he will balance his budget. Happy to take questions.

Journalist:          Is the Treasurer being again, too overly optimistic? With the carbon tax and the mining tax in this budget, there’s been $13 billion lost out of those two initiatives together, and then the Treasurer is still forecasting a return to surplus in 2-3 years?



Andrew Leigh: Our forecasts are based on the best available data and what we saw over the course of last year was a once-in-fifty-year episode in which nominal growth for a sustained period was below real growth and that’s driven in large part by the high Australian dollar. Australians recognise, I think, the high dollar hurts our revenues. But our choice then is to make the responsible savings that you saw in last night’s budget or take the alternative that Tony Abbott would have of cutting to the bone.

Journalist:          The believability factor here is going to be a big issue with four months out from the election. Last budget, Treasurer Wayne Swan promised a surplus, this year we’re getting a $19.4 billion deficit. How can voters believe Labor?



Andrew Leigh: What you’ve seen from Wayne Swan and what you never saw from Peter Costello is a willingness to have a serious economic discussion with the Australian people. I mean, when you look at the great Australian Treasurers, Paul Keating and Wayne Swan, each of whom won the Euromoney Finance Minister of the Year Award, they’re people that were willing to talk about nominal and real growth, to talk about the impact of the high Australian dollar and to talk about trade-offs. That’s why I think Wayne Swan is a terrific Treasurer and it’s why Joe Hockey hasn’t measured up, because Mr Hockey talks ‘age of entitlement’, but when it comes to making tough decisions he compared our modest changes to the Baby Bonus last time round to China’s One Child Policy. This is a guy that just can’t make the serious trade-offs that are required to be a Treasurer. He gets rolled by shadow cabinet every time he tries to make a responsible saving, and then as he said last night to Laurie Oakes, “I’m a team player”. Well, that doesn’t cut it when you have big revenue downgrades on top of the $70 billion dollars the Coalition starts behind.

Journalist:          How do you think those in your electorate will react to the axing of the Baby Bonus? Do you think it will be met well in the electorate?



Andrew Leigh: I think there will be a recognition within my electorate that we have to make responsible saves and that changing the Baby Bonus and so it’s targeted to people receiving Family Tax Benefit Part A and comes down to $2000, is a responsible savings measure. We know that the Baby Bonus didn’t have a big impact on fertility. A Melbourne University study coauthored by Mark Wooden had the cost of each new baby induced by the Baby Bonus at $150,000 a year. So, this was never good public policy and what we’ve done by means testing it and bringing the amount down has been in the spirit of the means-tested, targeted, Australian social safety net which has served Australia well for decades.

Journalist:          How can you rectify scrapping the Baby Bonus but keeping a cash hand-out like the SchoolKids Bonus?



Andrew Leigh: The SchoolKids Bonus is targeted at those school expenses. It comes regularly in the beginning of each school term and it’s designed to encourage Australians to invest in their child’s education, to help ends meet around uniforms, books, we know school is expensive and we want to make sure no child turns up on the first day of school without an essential textbook, exercise book or uniform. The SchoolKids Bonus does that in a targeted way.

Journalist:          The mining tax raised ten per cent of what was originally forecast. Surely now is the time to rethink the design?



Andrew Leigh: When you look at the Petroleum Resource Rent Tax over its 25 year history, if you’d analysed the PRRT one year in, you would have said, “well this tax isn’t raising what we wanted it to raise”. But over the course of the last quarter century, the PRRT has bought in, I think, around $25 billion. The Minerals Resource Rent Tax depends on commodity prices and it also depends on the deductions that mining companies are making, and that will change with the point of the cycle. But anyone who says going back to the old royalties regime is better than a profits based mining tax has got rocks in their head. There’s no sensible economist that would argue that.

Journalist:          But, you’re a sensible economist, no doubt you’d agree with me in saying that, surely you would agree that there’s a structural flaw here that needs to be rethought into the future because Wayne Swan’s predictions about what that tax will raise are again, very overly optimistic over the forward estimates.



Andrew Leigh: But Laura, I don’t think it’s a structural problem that we’re not forecasting mining tax revenues down to the last dollar. I don’t think it’s a structural problem that we…

Journalist:          (inaudible) at all, this raised ten per cent of what was originally forecast: $200 million dollars.



Andrew Leigh: I don’t think it’s a structural problem that mining tax revenues are going to fluctuate up and down. There’s two things here. First of all there’s the slight drop-off in commodity prices. Secondly, the timing of deductions and companies are putting a lot more deductions in in the investment phase than they will be in the volume driven phase of the mining boom that we’re now shifting to.

Journalist:          Ok, you know how forecasting works and there’s been a lot of criticism of Treasury and how these forecast have been so out. Is Wayne Swan taking the high end of forecasting, the range given to him, or is Treasury getting it wrong?



Andrew Leigh: These forecasts are not a political choice. The forecasts are economic judgements done by our best forecasters. Now they’ve never been precise down to the last dollar. In the Howard years we saw underestimates of revenue and last year we’ve seen an over estimate of revenue. That’s not because of any mendacity by the people doing the forecasts; it simply reflects the fact that forecasting is an inexact science and changes in the global economy such as the huge demand for Australian bonds affect government revenues. All right folks, thanks very much.

I spoke this morning with Mark Parton about the federal budget, and the clear choice it presents for this year's election: between Labor's nation-building reforms in health, schools and DisabilityCare, and the Coalition's threatened cuts. Here's a podcast.

TRANSCRIPT – 2CC BREAKFAST WITH MARK PARTON
Andrew Leigh MP
Parliamentary Secretary to the Prime Minister
Member for Fraser
15 May 2013

TOPICS:                The Budget.

Mark Parton:     Andrew Leigh is the Federal Member for Fraser, for the ALP. He’s an economist of some note, and he’s a contributor to this program of some note, he joins us right now. Hello Andrew.

Andrew Leigh: G’day Mark. Does that make me a commenter of calibre?

Mark Parton:     That it does. Now obviously you are happy with what Wayne Swan delivered last night, because you have to be.

Andrew Leigh: Well Mark, it’s a tough international situation for our budget. This high dollar has had a big hit on government revenues and we’ve had to make a set of hard decisions last night, decisions that in an ideal world, you certainly wouldn’t want to be taking. But the choice that Australian families will have come September is between the sort of strong Labor investments and the cuts that Mr Abbott will have to make because he spent the last few years saying ‘yes’ to special interests and ‘no’ to any sensible revenue raising measure.

Mark Parton:     So many interesting things about this document from last night, among them that we’re only three or four months away from an election. And I’ve never seen a pre-election budget like this because there are no carrots, there are no sweeteners. There’s a stark honesty which I think is extremely responsible.

Andrew Leigh: Mark we’re being level with the Australian people about the challenges for the revenue. What we’ve seen over the last year is a $17 billion fall in what the government takes in. That’s got nothing to do with what we spend; just a large fall tax revenue, driven to a large extent by the high dollar driving down company taxes. That’s a challenge for us, but it’s a challenge for everyone in parliament and I really hope that Mr Abbott is going to stand up on Thursday night and he’s going to be able to say ‘well, I’ll back Labor’s saving here, I’ll back Labor’s saving here, I’ll back Labor’s saving here, I’ll back Labor’s saving here’. If he can’t, then he’s basically hiding cuts in his top drawer, hoping he can keep them secret until after the election.

Mark Parton:     I guess the other fascinating thing about it is so much of the pain here comes, in theory if there’s a change of government, not under you guys but under them. And it will be interesting to see how much they want to tinker with. So many of these measures won’t even be passed in this current term of government, will they?

Andrew Leigh: Mark I know there’s many people on the Liberal side of politics who think they’ve got the election sewn up. I take a different view, I’m pretty respecting of the voters and I think they’ll make a considered judgment in September. But the budget invests over a long horizon – we’re looking at putting in place important road building measures in Australia’s big cities, like we saw with the Majura Parkway investment for the ACT in last year’s budget. We’re looking at putting place DisabilityCare, which is going to be a pillar of our social safety system, hopefully for generations to come. And we’re putting in place that school investment that you’d expect from a responsible Labor government, recognising that great schools drive prosperity.

Mark Parton:     We spoke with Alex Malley from CPA, from the accountancy group earlier, and he was suggesting that there were massive missed opportunities here in shoring up Australia’s competitiveness, that it’s all well and good to beat the corporates over the head and try and get as much money out of them, but ultimately if we can’t compete on the business front, well the whole country is not going to be served well.

Andrew Leigh: But our company tax changes Mark, and I don’t know if he’s talking about the thin capitalisation deductibility rules, they’re driven by shifts that we’re seeing around the world. Countries trying to make sure that firms don’t shift profits in order to avoid paying tax. You and I can’t shift our salaries over to avoid paying tax, and we’re basically applying that principle to companies. That strikes me as being pretty fair and responsible in a budget in which we’re asking a lot of people to give a little to build a better country.

Mark Parton:     Andrew, thanks for your time this morning, we appreciate it.

Andrew Leigh: Thank you Mark. Appreciate it.

TRANSCRIPT – BREAKING POLITICS WITH  TIM LESTER
Andrew Leigh MP
Parliamentary Secretary to the Prime Minister
Member for Fraser
14 May 2013

TOPICS:                The Budget.

Tim Lester:         Andrew Leigh, Senator Fiona Nash, welcome into the Breaking Politics studio - on budget day, which makes it a fascinating one. This morning we’re told that the government will outline in tonight’s budget ten year plans for big spending programs: Gonski and NDIS. Andrew Leigh, can we really honestly forecast ten years out, meaningfully, given that revenue forecasts went awry in a year?



Andrew Leigh: Tim I think it’s important to have that big picture, long-term thinking. And Treasury actually has a track record of doing that. The Intergenerational Report, which was produced under the Coalition, looked decades ahead. Our view is that with big and important reforms, like the schools reforms and DisabilityCare – which is so sorely needed by families whose child has a disability, people who are watching this program that were awake in the middle of last night caring for an adult child with a disability. Those people want DisabilityCare, and they want to know that it will last and so this is about outlining the saves we will make, and hopefully saves that Mr Abbott will come on board and support.

Tim Lester:         But Fiona Nash, surely big social objectives like deserve long-term planning, so wouldn’t the Coalition at least support the principle of taking big-ticket plans out to ten years?

Fiona Nash:        Well I think that’s one of the criticisms of the Labor government, that there hasn’t been any vision. There hasn’t been any look to the future of the nation and how we want to look since they’ve been in government. And it must be a little frustrating for Andrew, with his economic credentials, watching his government make a mess of it. The things is that people out there in our communities just simply don’t believe Wayne Swan any more. His forecasts from one budget to the next have fallen over, what he said in last year’s budget hasn’t come to pass, he’s predicted surpluses and now we’ve got a $17 billion black hole. So for him to now say ‘I have this ten year plan and everybody believe me I’m going to lead you to the promised land’, it’s a bit of a stretch and people are just really questioning whether or not he has the ability to deliver it, and whether or not he’s actually telling the truth. It just seems like a last minute opportunity to convince the Australian people that he has some vision for the future.

Tim Lester:         Credibility problem with the Treasury, you say. What about the philosophy though of ten year planning in our budget? Good, bad or indifferent?

Fiona Nash:        Well it depends obviously on the cycles, what’s coming up in the future, you can’t have a crystal ball. It’s obviously admirable to look towards the future, right, for the nation, where do we want to be in ten years. For those big ticket items, how are we going to get there? Unfortunately for the Treasurer, nobody believes a word he says anymore, because everything that he has said has turned out not to be true.

Tim Lester:         Just before we return to Andrew Leigh, do you think – given you support the idea but not the person delivering it, or the record of the person delivering it – do you think the Coalition will back these longer term plans? Or do you think they’ll say uh uh, it’s got Wayne Swan’s fingerprints, we don’t want to be near it.

Fiona Nash:        We’re going to have to look at the budget tonight and see what the government’s actually going to deliver. There’s no way you can make any commentary now about what post the budget until we’ve seen it. So we’re going to very carefully and methodically work through what the budget has, what the government brings us this evening, and then we’ll make decisions on that basis.

Tim Lester:         Is it fair for the Coalition to say we’re not going to commit these plans til we’ve looked right through them, we can’t talk about the philosophy of ten year plans. And indeed to say they want to leave their hard-nosed budgeting for the election campaign, when they get the budget numbers then?



Andrew Leigh: Tim, I was actually a bit worried, listening to what Fiona had to say. I’m sure she, as I, have spoken to people with disabilities in the electorate, but then what I heard from Fiona just now when you asked her whether she’d support the long-term DisabilityCare reform was wait and see.

Fiona Nash:        No, no I didn’t – to be fair, I said how that would be funded, we’d wait and see what the budget is. Of course we support those principles, absolutely.



Andrew Leigh: It is one thing to support DisabilityCare, it is another thing to say how you’ll pay for it.

Fiona Nash:        There are different ways for paying for things, yours will not be the only way. We don’t have to sign up now to the way you say you’re going to pay for it, when we haven’t even seen the budget. That would just be ridiculous.



Andrew Leigh: What you need to do, if you back a big reform, is to say how you’ll manage to pay for it. The Coalition are starting $50 to $70 billion behind, not my figure, Joe Hockey and Andrew Robb’s figure. Beginning from that starting point, they have to make massive cuts, and that’s before they even get to the point of thinking about how they’ll pay for DisabilityCare. Words are cheap, but if Mr Abbott decides that his top priority is a tax cut for big miners, and a tax cut for big polluters – two things he’s locked into – and he is going to oppose the responsible Labor savings measures that will set up DisabilityCare for the next decade, then that is a scary future for people with disabilities.

Tim Lester:         There is a disconnect here a bit in that the Coalition’s position, Fiona Nash, in that you are saying that we support these worthy projects – certainly disability insurance as one. Support for it, but we’re not going to tell you how we’re going to fund it, we don’t know the numbers and we don’t want to base any numbers on tonight’s budget, and we’ve got to wait until the election campaign two weeks out from when we get to vote. That’s a bit of a leap of faith for voters to assess all of that in such a crammed time before the election isn’t it?

Fiona Nash:        I don’t think so at all, I think they want the Coalition to be sensible about how we’re going to plan for the future for the economy. Now they can trust that, to the current Labor government, that has continually told the Australian people that economically certain things were going to happen, we saw that in the budget last year for Wayne Swan and clearly, clearly what he predicted has been incorrect. So I just think it’s sensible that we take a very pragmatic view. We in the Coalition make sure that we have a very clear view of the base we’re working off economically before we go and say to the Australian people this is how we’re going to fund what we’re going to do. I think that’s actually what the Australian people expect of us. No one wants to run in half-cocked and say ‘yes we’re going to do this or we’re going to do that’. They actually want the contrasted view of the Coalition of a measured, well-though out approach to managing the economy, which they’re not seeing from Julia Gillard and the Labor government.

Tim Lester:         Andrew Leigh, doesn’t Fiona Nash have a point in as much as she says the long term plan is great, but when you’ve got a Treasurer who’s just sworn black and blue that he’s going to deliver a surplus, black and blue, time and time again, did not – and now he’s going to come back and promise another surplus and a ten year plan, who is going to believe it?



Andrew Leigh: Tim, I think that everybody understands the high Australian dollar has a big impact on government revenues. The Australian economy is performing strongly – we’ve gone from the 15^th largest to the 12^th largest economy in the world over the last 6 years. We’ve got debt to GDP of 10%, well below most other countries.

Tim Lester:         But can we forgive Wayne Swan the mistakes?



Andrew Leigh: We’ve taken a hit to revenue and Wayne Swan has been honest enough to talk to the Australian people about the implications of that hit to revenue, and what it means to how we’ll pay for important reforms. Mr Abbott and M Hockey seem to hiding their policies in the top drawer, and I think Australian people are entitled to say if these policies were really so good for households, would they be sitting in that top drawer, or would they be out in the open? There are swingeing cuts that the Coalition will have to put into place to if it is to pay for the promises it has signed on to. This gold-plated parental leave, you know that is a $5billion plus scheme. If you’re committed to that, if you’re committed to the tax cuts for big miners and big polluters, then you’re going to have to make bigger cuts: not just the hit to low-income earners on superannuation, not just taking away the schoolkids bonus, but tax rises, pension cuts, cuts to major social expenditures that people rely. We’ve seen this with past Coalition governments, we’ve seen this with the Newman government in Queensland, where a commission of audit has acted to hide some cuts which have seen nurses, police officers, teachers losing their job. That’s a scary future. The Australian people, if they’re going to vote for it, ought to at least be given the dignity of seeing those choices, those trade-offs, put forward by major parties. Not at a minute before the election, but months in advance so they can be properly debated. And this in the Coalition’s interests as well. Good policy rarely comes out of a smoke-filled backroom with two or three blokes gathered around a table. Policy improves by being put into the public air. The Coalition’s policies would be better if they were to put them out, have that public debate, talk about the things they’re going to cut, be honest, come clean with the Australian people.

Tim Lester:         Well in fairness to Tony Abbott, there is some policy out, there’s probably not the costings back it that you’d like to see in its place in a detailed budget, but the policy is at least partly out there. I’d like to ask you both before we close is to nominate a year in which you think we ought to be back to surplus, if the road back to surplus is going to be a credible one. Cast aside your views of Wayne Swan for a moment and just say which year in the forward plans ought we see a black number on the bottom line of the budget and go ‘yeah that’s fair enough, I believe that we can do that’. You first, Fiona Nash?

Fiona Nash:        Well I think that if the Labor government had done a decent job of managing the economy since 2007 that year should be this year.

Tim Lester:         Right – that’s in a perfect world. From the world we now sit in, the position we now enjoy or don’t enjoy, where do you believe we should arrive at a surplus if it is to be a credible one?

Fiona Nash:        Look I’m not an economist, I can’t give you a 2015, 16 or 17 date. I just know that the Australian people want a government that’s going to start managing the economy properly, because there is no confidence out in the communities. Andrew talks about all the headlines figures of how well as a nation we’re going, I don’t think the Labor government is spending enough time walking up and down the main streets – particularly in regional communities – because what they want is some confidence back. They don’t have it under this government and they are looking for someone, a grown up, to run the economy, run the country properly, so they can get on and do business and get on with their lives in the way that they want to.

Tim Lester:         Ok, you’ve chosen not to nominate a year from where we stand. Andrew Leigh, will you nominate a year? You are an economist, by the way, so  you don’t get the get out of jail card.



Andrew Leigh: Tim we’re filming this eleven hours before Wayne Swan will bring down the budget, let’s let the Treasurer bring down the detailed budget figures in eleven hours’ time. I’d encourage people to tune in, I’m sure Wayne will deliver a strong speech there. And he will level with the Australian people what we’ll do, and how we’ll pay for it. The question then is whether on Thursday night Mr Abbott will do the same thing, whether he will talk about the trade-offs and how he will pay for things as well.

Tim Lester:         Fascinating couple of days ahead, and great to have you both regulars here to chew the fat over it. Andrew Leigh, Fiona Nash, thanks for coming to Breaking Politics.

Listen Here: http://media.smh.com.au/news/national-times/details-please-4270757.html

MEDIA RELEASE - 14 MAY

Federal Budget will mean a stronger, smarter and fairer Canberra

Initiatives outlined in Wayne Swan’s sixth Budget will mean a stronger, smarter and fairer Canberra.

While Canberra is small compared to other Australian states and territories, initiatives outlined in this Budget demonstrate the special role Canberra plays as a city of culture, learning, and a provider of important services to the whole country.

The Budget also captures the relationship forged with the ACT Labor Government on important reforms such as the National Disability Insurance Scheme, now called DisabilityCare Australia.

This Budget delivers a range of initiatives that map a path back to surplus. The initiatives outlined in this Budget are offset by responsible savings ensuring that the cost of nation building programs such as DisabilityCare Australia and the National Plan for School Improvement are shared across the whole community.

Canberra will be able to share in over $690 million in additions and amendments to the Pharmaceutical Benefits Scheme and $29.6 million for support in the dispensing of chemotherapy medicines.

$96.7 million will be made available to increase the number of Commonwealth Support Places in sub-bachelor and post-graduate level studies.

Labor’s historic Paid Parental Leave Scheme will also be improved as a result of this Budget to make it easier for working mothers with children born close together to qualify for Paid Parental Leave for subsequent children.

This Budget prioritises Australian jobs and growth by taking responsible decisions. This directly contrasts with Tony Abbott’s arbitrary measures which will cut Canberra to the bone.

Tony Abbott has promised that should he get elected in September, at least 20,000 Canberra jobs and the local businesses that rely on them stand to be wiped out, to pay for promises like Mr Abbott’s tax cuts for big miners and big polluters.

The reality could be worse still. After the 1996 election, John Howard sacked ten times as many public servants as he had promised before the election.

With a self-confessed $70 billion black hole, Senator Lundy and members Gai Brodtmann and Andrew Leigh call on Tony Abbott to outline what cuts he will make to Canberra in order to fund his promises.

On Sky’s “The Nation” program with David Speers, Andrew Leigh MP joined an “all economist” panel with respected commentator Jessica Irvine, Liberal MP Paul Fletcher and former Liberal leader John Hewson. We discussed the strength of the Australian economy, the hit on budget revenues, Labor’s DisabilityCare reforms and the Coalition’s regressive parental leave scheme & “WorkChoices lite” policy.http://www.youtube.com/v/Bdi6zSCKr04?version=3&hl=en_US

I spoke yesterday at a Canberra ceremony to mark the anniversary of the Battle of the Coral Sea. It was an special honour to meet navy veteran Gordon Johnstone, who served as a telegrapher in the Battle of the Coral Sea (picture by Peter McDermott).

Speech to the Australian-American Association Canberra Division Battle of the Coral Commemorative Service

9 May 2013
Canberra

Andrew Leigh
Parliamentary Secretary to the Prime Minister

[Acknowledgements omitted]

The Battle of the Coral Sea was a unique battle in history.

It was the first time aircraft carriers engaged one another, never sighting their enemies.

It remains the largest naval battle in to have taken place off Australia’s coast.

We stand here in front of the Australian-American memorial. It is not the most modest piece of architecture in Canberra.

Neither are aircraft carriers. This was brought home to me when visiting New York recently, where the decommissioned USS Intrepid sits at anchor. There is something awesome about walking on the deck of a ship that can carry 100 aircraft.

The importance of the Battle of the Coral Sea was not lost on Australians in May of 1942. Prime Minister Curtin described the battle in a speech at the time: ‘Events that are taking place today are of crucial importance to the whole conduct of the war in this theatre . . . I should add that at this moment nobody can tell what the result of the engagement may be. If it should go advantageously, we shall have cause for great gratitude and our position will then be somewhat clearer. But if we should not have the advantages from this battle for which we hope, all that confronts us is a sterner ordeal and a greater and grave responsibility.’

Able Seaman Roy Scrivener of HMAS Hobart described his impression of the Australian and American forces massed to meet the Japanese Navy as: ‘The most magnificent sight I had ever seen.  There were two aircraft carriers, there were battle ships, there were cruisers, there were destroyers and trailing astern and a little separated, were the tankers with their destroyer escorts. And what a wonderful feeling I had until I realised, my God, they’re not here to play games. We’re all here for fair dinkum trouble!’

Fair dinkum trouble they found. Thankfully, the Australian and American naval forces were successful, and the Japanese Navy never reached as far south as they did on this occasion.

Today, we honour the successes of the Australian and American forces. But we also recognise the valour of their Japanese foes.

It is also worth noting that throughout the early-1940s, the German naval forces were urging the Japanese to adopt a policy of targeting merchant ships. But the Japanese, under Admiral Suetsugu, resisted, arguing instead that their principal target were naval vessels, not civilian ships.

We honour our Japanese opponents in World War II with the same spirit of those Australians who, after the midget submarine attacks on Sydney Harbour in May 1942, gave the deceased submariners a full military funeral on Sydney heads.

As member for Fraser, I have a direct connection with the Battle of the Coral Sea. The suburb of Crace in my electorate is named after Edward Kendall Crace, whose son Vice Admiral John Crace commanded the Australian fleet in the Battle of the Coral Sea. I am reminded of the battle each time I visit the suburb of Crace.

We are also reminded of it through the ANZUS treaty, a lasting partnership with the United States. The treaty would not be finalised until 1951, but it was forged in the crucible of World War II.

Lest we forget.

A recent trip to Perth prompted some thoughts on Coalition costings, starting with what's happened in Western Australia.

Of Cuts and Cons

The Barnett Liberals were elected promising to deliver a $4.8 billion swag of ambitious infrastructure projects: the Metro Area Express Light Rail, the Perth Airport line and the Perth to Darwin highway. But their promises are a sham.

Scrutinise the costing details and you find the most brazen of creative accounting cons: the projects rely on an ‘assumption’ that the Commonwealth would fork out $3 billion.

Where did they get this number? Certainly not from the Commonwealth. They just made it up. You can promise whatever you like when there’s imaginary money to pay for it.

This was just one of the Liberals’ tricks uncovered by WA Treasury, who red-flagged the contribution assumption as a ‘substantial risk’ to the Liberals’ budget integrity.

Let’s be clear. The issue is not the merit of the programs. The issue is Mr Barnett blatantly misleading the community about what he can deliver.

Perhaps Mr Barnett might claim that his costings were premised on swinging a mate’s rates deal if Mr Abbott is elected on 14 September. Not likely. Tony Abbott has admitted that the Liberals ‘have no history of funding urban rail and I think it’s important that we stick to our knitting’. (Conversely, Federal Labor have put more into urban public transport than every previous government since Federation – combined.)

Unlike the Federal Liberals, Labor will not automatically veto rail investment. We will assess the Barnett proposals on their merits, in the established process. The process involves picking up the phone to the Commonwealth and setting out details of the projects so that a formal assessment can take place.

Depending on the outcome of the funding bid - $1.6 billion of which Mr Barnett hadn’t even submitted prior to winning the election – Western Australians could be left with a $3 billion Barnett black hole.

Now that’s a lot, but it’s loose change compared to the $70 billion fiscal crater engulfing Mr Barnett’s Federal Coalition colleagues.

Seventy billion is not a Labor figure. It’s what Joe Hockey admitted to Sunrise on 12 August 2011.

Mr Abbott has racked up this $70 billion blowout by saying ‘yes’ to every vested interest while yelling ‘no’ to Labor’s responsible savings.

What Mr Abbott hasn’t done is outline exactly how he plans to plug his $70 billion black hole. Mr Abbott has only revealed a handful of his cut-back plans – and they’re not pretty.

Speaking on 3AW on 3 February 2010, prior to the last election, Mr Abbott told listeners that he’d go to the election ‘with a list of promises, a list of commitments and we will fund them without new or increased taxes’.

But Mr Abbott’s business tax hike will affect 3,200 successful Australian businesses, which will be passed onto Australian families through higher prices.

And don’t take my word for it. In a recent interview with Mr Abbott on Adelaide’s 5AA radio, the host asked ‘The Fin Review today reports that the nation’s largest companies are unhappy with what it will cost them – they think it might cost about $100 million on average for these big companies. They would in turn, turn that around into a tax on more Australians, wouldn’t they?’

Mr Abbott responded ‘Well, obviously businesses do pass on costs and if there was a levy that was to fund something, yes that would be a cost.’

So he’s gone from saying he won’t increase taxes to proudly admitting that his tax will slug Australian families at the shops or when they fill up the car with petrol

Tony Abbott likes to talk tough on tax, but he in fact wants to bring almost 1 million Australians back into the tax system by abolishing Labor’s increase in the tax free threshold.

He has also pledged to hit 3.6 million Australians with a $4 billion super tax hike.  This will reduce the retirement savings of low income Australians, including more than 350,000 shop assistants and cashiers, 200,000 food and hospitality workers, and 80,000 cleaners.

He’ll also abolish SchoolKids Bonus – a measure intended to helping with education expenses – taking $1,200 a year from the average family’s budget.

Who could forget the Liberals’ 2010 election costing debacle? They claimed their costings had been audited, but the accountants were fined by the Institute of Charted Accountants for breaching professional standards.

Nearly three years later, not much has changed. The Liberals claim their policies are costed – Andrew Robb says the costings sit in his top drawer. But to this day, they remain secret.

Australian families need to ask: if the Coalition’s policies were good for them, would the Opposition really be keeping them secret?

TRANSCRIPT – SHOWDOWN WITH PETER VAN ONSELEN
Andrew Leigh MP
Parliamentary Secretary to the Prime Minister
Member for Fraser
7 May 2013

TOPICS:                                Carbon pricing, revenue write downs, cut in interest rates, Liberal Party conscience vote for equal marriage, the federal Budget

Peter van Onselen:         Welcome back you’re watching Showdown. I’ve been speaking to Peter Reith, joining us out of Melbourne as well as Senator Cory Bernardi, joining us out of South Australia, we’re now also joined by Dr Andrew Leigh the Parliamentary Secretary to the Prime Minister, who joins us out of Canberra. Mr Leigh thanks for your company, or Dr Leigh I should say, don’t want to down grade you before we get the interview started.

Andrew Leigh: Now worries at all, good to see you Peter.

Peter van Onselen:         Can I, I just want to start by going back to you, Senator Cory Bernardi if I can. On your blog today you’ve had a bit of a crack at the style of the government that is being run by David Cameron over there in the in the UK. You’ve called it a soft-left policy agenda led by a man who’s most notable commitment has been to make the once proud Conservative Party more green than Labour, but what intrigued me was the next line; you said a few years ago there were a number in the Liberal Party here who actually thought this was the best path for us to adopt. Who was that?

Cory Bernardi:                   Well Peter you know we had an extensive debate about the emissions trading scheme and supporting Labor’s policy. I was not one of those who subscribed to that I warned about the dangers for the Liberal Party about going down that path, and I think the proof is in the pudding. If you look in the United Kingdom’s experience, David Cameron I think won an election, but he was forced into coalition when he should never have been because the Labour party was so bad over there, and here, because we actually took a principled stand about was in the national interest, Tony Abbott came within a whisker of becoming Prime Minister at the last election, and I think, you know, the rest is history. The caravan that…

Peter van Onselen:         But Senator how does this work? You were at the vanguard of having a problem with Malcolm Turnbull and the Liberal Party more broadly pushing to support the ETS ahead of Copenhagen. You were at the vanguard of opposing that. Yet the people that were all around Malcolm Turnbull are now the same people that are the senior people around Tony Abbott. Now I know the Liberal Party’s a broad church, but is that at least a little bit surprising?

Cory Bernardi:                   Oh I don’t think so. I think you know, Tony Abbott will always choose the team that he wants around him. He’s got an experienced team. You know quite frankly, I think we’ve got a good policy agenda to take into the next election, but one of the points I want to make is that you know, aping the Labor Party is a recipe for disaster. We are, you know, a centre-right party. We should be espousing the principles that have built the Liberal party over many , many decades and that’s about supporting families, about supporting small business, about lower taxation and you know, the maximum level of freedom that we can have in an orderly society. And I think we need to limit the growth and size of government and we certainly need to stop the government from borrowing you know, tens of billions of dollars every single year because they can’t control their spending.

Peter van Onselen:         Andrew Leigh, can I just bring you in and ask you about the levy that was announced by the Prime Minister in relation to paying for the NDIS. Now as an economist, you are someone who as I understand it, when the levy was originally rejected by the Prime Minister, had some strong economic reasoning why that kind of specific allocation of levies to pay for specific government spending was not a good idea. Yet now that is the path that now the Government is going down.

Andrew Leigh: Well Peter the big change in the revenues is just the striking difference between this year and last. So compared to the last budget, revenues for this budget are projected to be coming in seventeen billion dollars smaller. Now for those who don’t carry billions of dollars in your bank account, the way of thinking about that is that’s one full one full per cent of GDP. It’s a massive write down and I’m sure there hasn’t been a bigger write down in the history of the Commonwealth and that’s led the Government to be making a set of announcements, including the levy that you pointed to, in order to make those books balance. Now, it’s got to be clear, this is not a decision of the Government that has caused this revenue write down; with the same set of taxes, we are bringing seventeen billion dollars less revenue, and that’s a challenge for us and of course-

Peter van Onselen:         can I ask you this though, because isn’t one of the issues here that during the Costello years they underestimated revenue, during the Swan years, you have, or the Government has overestimated revenue. Now my understanding is that there is a range that is put by Treasury to the Government for the various estimates and Costello had a penchant for always taking the bottom of that range and hence he was always discovering that there was extra revenue left in the kitty when the good times rolled on. Wayne Swan when he’s presented with that range goes for the higher end on the estimates for the Budget and therefore, unsurprisingly, when we’re not in such good times there’s a massive underestimation there. Isn’t that why it’s bad policy to turn around and spend the money before it’s come into the kitty when you know that firstly, you’re on the higher side of the range that you select, and secondly you know from historical evidence that there has been a constant inaccuracy in these numbers anyway?

Andrew Leigh: Peter I’ve spent time as a secondi in Treasury, spent six months there, I’ve certainly never heard of what you’re talking about either for Peter Costello or for Wayne Swan. I’ve never heard of people suggesting that the forecast on revenue were anything but the best guess from the ‘boffins’. The problem is that when you’re forecasting revenue, you’re taking a growth forecast and then you’re also trying to extrapolate from that what company profits will look like. We’ve got something of the moment of the perfect storm at the moment in the combination of drop off in commodity prices, but the dollar staying high because of the strong appetite for Australian bonds, and then of course this unique situation of real growth outpacing nominal growth. All of that is pretty unusual and that’s led to this big revenue write down.  We’re still an economy which is doing extraordinarily well by international standards, strong growth, half the unemployment rate of Europe…

Peter van Onselen:         There’s obviously worries though, with the Reserve Bank dropping interest rates today though, I mean that might be a good thing for home owners, but at the end of the day, it is a sign of softness isn’t it?

Andrew Leigh: Well it is a far cry from those days where you would hear people say that interest rates would always be lower under a Coalition Government, isn’t it, Peter? Certainly this is welcome news for homeowners and as the Reserve Bank has said in its statement, it’s weighed up a set of factors, it’s looked at some of the domestic strengths but also the international challenges, the pressure that the high Australian dollar’s put on the economy and overall decided that a quarter point cut would be appropriate.

Peter van Onselen:         Peter Reith can I bring you in and ask you, you were a Shadow Treasurer once upon a time yourself. You were also a senior minister, Minister for Workplace Relations, and if I understand correctly a member of the Expenditure Review Committee for the Howard Government for some time as well, how do you see this debate about the idea that well, revenue is just, you know, underperforming expectations so therefore there’s nothing untoward in what’s happened.

Peter Reith:                        I think quite frankly Andrew, I think what you have to say is laughable. Uh, I mean, look sure there are ups and downs in numbers, but I mean there’s just been one blunder after another under Labor, I mean the mining tax, the carbon tax, you’ve fixed it to Europe. You know, the figure there is three dollars, it’s twenty three…

Andrew Leigh: What has that got to do with any of this?

Peter Reith:                        Well it’s all coming mate, it’s all adding to the problems, fiscal policies that you’ve got. Look the wasting…

Andrew Leigh: It’s all part of the vibe. It’s all part of the thing.

Peter Reith:                        It’s not, it’s the wastage. Uh the fact is you haven’t been, you know, you were running the line a minute ago “oh the dollar’s high”, well mate I’ve got news for you; the dollar was high a year ago when the last Budget was done.  I mean if that’s such a big factor why wasn’t that put in? Why are you still using you know, last year’s arguments? Now the fact is that a government that had been a lot more prudent than you have, instead of, you know, giving people this nonsense about how great the economy is, you know, the RBA has cut it back again today, record lows and you can’t even acknowledge the fact that there are big slices of the Australian economy that got real problems and we’ve got a turning down on the mining industry. Now, you know, a bit of realism, you know, inserted into the decision making on the Budget would’ve avoided a fair chunk of the problems that you’ve got. And on top of that, you know, you’re still in a mode where you think you can just go on spending and, of course, those days are gone.

Peter van Onselen:         Andrew Leigh your response?

Andrew Leigh: Well certainly what we’re doing is taking the best advice of Treasury, I reject what Peter has said there entirely…

(Peter Reith:                      You’ve got to stop blaming everybody else Andrew)

Andrew Leigh: …in terms of decisions the Government has made. The decision on pricing carbon for example is in accord with what every sensible economist would advocate. I mean, you’ll have the shonks and shysters telling you that direct action and soil magic can somehow deal with climate change, but this is the economically responsible thing to do, to put a price on carbon pollution. And what you’ve got to realise is that internationally, Australia’s position is strong: ten per cent government debt is extremely low by international standards, but we have…

Peter van Onselen:         Can I, can I ask you about that, sorry to interrupt you. It is low and I don’t disagree with that, but it is also true isn’t it that it has risen at a sharp rate comparable to a lot of countries that started with a lot higher debt and have now obviously ended up with even higher debt. In this country it remains low but it’s only low because we started with no debt. The scale of the increase has been pretty significant.

Andrew Leigh: Well I mean when you put in place stimulus spending you backed quickly. The alternative is to lose hundreds of thousands of jobs. Everyone that tells you we should not have taken on debt in the global financial crisis is saying that they wish unemployment had been driven up to double-digits, as it has been in Europe, because that’s the alternative…

Peter van Onselen:         But couldn’t we have just dumped interest rates? Couldn’t we have used monetary instead of fiscal policy?

Andrew Leigh: Well we did both as you recall Peter, I mean we put in place monetary policy which has an impact on sectors of the economy that are borrowing. But then of course, that’s only a portion of the economy, and as OECD, IMF, were advising at the time, as most countries did, you then want to inject some fiscal policy at the same time, both through house hold payments which have a quick effect and through infrastructure spending which has a larger multiplier. All of what we did in the down turn was text book. The result was to save hundreds of thousands of jobs and to put Australia in a debt position which is low by international standards.

Peter Reith:                        Yeah but you’re just running over the facts here because, look  I don’t disagree with half of what you say, but you know, the other half you don’t get it right. I mean, Malcolm Turnbull, when he was Leader of the Opposition got up in the Parliament and said, “well, we understand why you’ve done what you’ve done so far, but cranking up even more stimulus we think is going too far”. Now, you don’t have an answer to that because there isn’t an answer to it, and Malcolm Turnbull was proved to be absolutely right and this was just another poor judgement call by your Treasurer, you know, thinking that just spending more money, you know, was somehow the answer and unfortunately it’s not. It’s the same with Gonski as well I might say, you know, just spending is the way to fix problems when, a lot of problems aren’t just fixed by spending more money.

Peter van Onselen:         Alright gentlemen, time out, we’re going to take a commercial break. When we comeback we’ll continue the debate including, I’d like to see the thoughts of Senator Cory Bernardi in relation to the issue of whether or not the Liberal Party should have a conscience vote on gay marriage after the next election. Back in a moment.

COMMERCIAL BREAK

Welcome back. You’re watching Showdown where I’m joined out of Melbourne by former Howard Government minister Peter Reith, out of South Australia by Liberal Senator Cory Bernardi and out of Canberra by the Parliamentary Secretary to the Prime Minister Dr Andrew Leigh. We’re going to move on to other subjects, but first if I can Andrew Leigh, can I just ask you Andrew Leigh, we’ve just had the Victorian Budget today; how is it that with revenue write downs they can forecast surpluses going forward over the next three years as well as deliver one in the current financial year, yet with write downs also at a federal level, we’re not in a position where we’ve got that kind of forecasting.

Andrew Leigh: Well we’re relying on more volatile tax bases at the federal level is one straightforward answer, Peter. Company tax revenues are much more volatile than GST revenues, so it makes it easier to project at a state level. But I do think that this is a good reason why Victoria should be signing on to the Gonski Reviews. I think it certainly signals that it’s about time that kids in low income schools in Victoria got a fair deal.

Peter van Onselen:         But isn’t just the case though that there might be volatile tax mixes at the federal level compared to the state level, but isn’t it just a case of fiscal conservatism at the end of the day if they are as volatile as you say. Don’t imprint spending into them before you actually know the return is. Be much more moderate and then be surprised on the upside?

Andrew Leigh: Peter, you sound like what you’re saying is that we should have made savings of $160 billion dollars over our last five Budgets, which is precisely what we’ve done. You sound like you might be saying we ought to put in place a levy to cover most of the cost of the DisabilityCare Australia and putting in place some targeted saves around family tax benefit. All these are things we’ve done and you’ll see more savings measures being announced in the coming days. As you say, that’s the prudent response when you get a revenue write down. But it’s not to sell off the family silver, it is not to trash DisabilityCare Australia, a system depended on by 410,000 people with disabilities and their carers. That I think isn’t the Australian way…

Peter van Onselen:         … but the thing is Andrew, I’ve got to take you to task a little bit on this because yes there are volatile taxes at a federal level but the states are reliant on GST revenue and in the case of Victoria there’s been a $7 billion write down on GST revenue into Victoria. Yet despite that, they’re still projecting surpluses.

Andrew Leigh: Well, Victoria has made some pretty savage cuts, Peter, and I think if you speak to nurses, police officers, fire fighters in Victoria, they might have a different complexion on the …

Peter van Onselen:         …so are you saying that if Labor was delivering the Budget you wouldn’t have made the savage cuts and therefore you’d be in deficit?

Andrew Leigh: Labor is always going to make targeted savings measures. We are going to make sure that we impose whatever cost there is on those who can best bear it. Tony Abbott by contrast is committed to giving tax cuts first to big miners and big polluters and then to handing out $75,000 cheques to some of the most affluent households in Australia through his gold-plated paid parental leave scheme which seems neither of your other two guests can defend…

Peter van Onselen:         …alright we’re not going there. Peter Reith’s had plenty of time on that one. Let me just go to you Senator Cory Bernadi, entirely different subject now…

Cory Bernadi:                     Well, can I just answer some of those things that Andrew raised, I mean, he’s boasting about $160 billion worth of savings. He’s not talking about the massive tax increases that he’s already foisted upon the economy. He’s not talking about the $300 billion worth of debt that they’ve racked up over the last six years. This is an outrageous sleight of hand and a nonsense. They have completely mismanaged their spending. Revenues are up and they just have no idea how to control their spend thrift ways and there’s nothing to show for it. This is the great problem we’ve got: nothing to show for it.

Peter van Onselen:         Alright we’ll take that as a comment as a certain other person in television often says. Let me ask you Cory Bernadi, as I said, on an entirely different subject, the issue of a conscience vote for gay marriage is something that an increasing number of Liberals are coming out and saying they’re in favour of after the next election. Tony Abbott has said that he’ll take that to the Party Room. The Liberal Party does have a proud tradition of providing conscience votes on certain issues. I know where you stand on the issue of gay marriage, but where do you stand on the issue of whether or not it should be a conscience vote for individual Liberal MPs?

Cory Bernadi:                     Well I’ll make the point that we have a tradition of conscience votes where we have no official Party position. Our Party position is that we support the existing definition of marriage as being between a man and a woman. We’ve supported that, you know, since the foundation of the Liberal Party quite frankly. Now, we also, I make the point, have the freedom for every single member of the front bench, or the back bench to vote according to their conscience if they don’t like the Party position. Now, I don’t detect any appetite quite frankly, amongst the general public or amongst the Party room to change our position right now. There might be one or two murmurings, but you know, quite frankly it’s not a mainstream issue. People are more concerned about the cost of living, about, you know, how this government is borrowing money and mortgaging the future of their kids.

Peter van Onselen:         so you don’t think it should be a conscience vote as simple as that? You’re of the view it should stay a Party vote?

Cory Bernadi:                     I absolutely support the existing Party policy.

Peter van Onselen:         And can I ask you on that, because when you were just talking about it, you made the point that, you know, that marriage should be between a man and a woman as something that’s been Liberal Party policy since, you know, the founding of the Liberal Party basically. Does that mean for you personally, if the Party room goes the other way and decides to make it a conscience vote issue, is that something you have a major problem with? Or would you just accept that that’s the Party Room position and it’s a change of policy for the Liberal Party, albeit one which is a complete change from the historical direction of the Party until now?

Cory Bernadi:                     Well the Party Room decision would be the binding decision. Ultimately I would still vote according to my own conscience on that particular matter. But I think there would be widespread electoral issues attached to the Liberal Party taking that position. Now, I have no evidence for that, I’m just supposing it. But look, let me say this Peter, it is not a mainstream issue. No one out there is talking about this in any significant sense. They’re worried about the cost of living and the mortgaging of their children’s future by this spend thrift government. That is what people are worried about. They want to see a change in government. They want to see a radical change in approach and some more responsibility attached to what their government does.

Peter van Onselen:         Peter Reith I think they will see a change of government and I know you agree with me on that. What’s your view on whether the Liberal Party should make the gay marriage issue a conscience vote irrespective of what your view is on the actual matter of gay marriage itself?

Peter Reith:                        I think Tony’s on the right track on this one. What he said is that after the election he’ll raise the issue in the shadow cabinet and then take the shadow cabinet view to the Party room and I think that’s the right process. And if he sticks to that and if he consults with the organisation as well I don’t think he’ll get into too much trouble.

Peter van Onselen:         But what’s your personal view? Do you think that, do you agree with Senator Cory Bernadi that it’s a Party position and it’s not something that is necessarily of the style of issue that should be a conscience vote or do you disagree with that?

Peter Reith:                        I must say I’m pretty relaxed about this issue and if they have a conscience vote I’d be quite happy with that myself. But I think, the main thing from the politics is that, you know, it’s got to handled sensitively by Tony and you know, give everybody a fair shake of what they’ve got to say about it so I think that’s the key thing. I think it probably will go through in the next term, but you know, time will tell.

Peter van Onselen:         Alright, we’re almost out of time, but Andrew Leigh before we go, I haven’t asked you about the cuts, or the cuts to increases if you want to put it that way, in terms of family payments that have been talked about by the Labor Party today. It strikes me that for a Party that is unashamedly a party of you know, people in lower socio-economic circumstances that they are the people impacted heavily by these removed increases. Why go down that path rather than finding other cuts, for example even to the SchoolKids Bonus which isn’t so targeted to low income earners only.

Andrew Leigh: Well Peter, the SchoolKids Bonus goes to people receiving Family Tax Benefit Part A so you’re talking about the same group of people. Look, I would ideally like to have seen these increases to the Family Tax Benefit Part A go ahead but in the current budgetary circumstances that’s simply not feasible. But we are putting in place a range of measures to assist that group, for example, the increase in superannuation contributions which Tony Abbott will rip away. Two thirds of those three million low income earners are women. Tony Abbott by contrast has said today that he thinks his gold-plated paid parental leave is good because it pays women of calibre more to have babies. Presumably what he means by that is that nurses, that child care workers, that cleaners are not women of calibre. I think that’s pretty troubling.

Peter van Onselen:         And I’ll have to interrupt you because we are way out of time but I know that Paul Murray live will be discussing exactly that issue after the commercial break. Peter Reith, Senator Cory Bernadi and Dr Andrew Leigh, thank you one and all for your company on this edition of Showdown. Thank you for your company in watching and I will see you again for Contrarians on Friday.