ABC Adelaide Webcast with Matthew Abraham and David Bevan
Subjects: Budget repair; Higher education reform; SA Government’s “punter’s tax”

Matthew Abraham: Well it’s a super digital Wednesday today and we welcome to the studio Greens Senator, spokesperson for the Greens on immigration and citizenship and early childhood education and so on, Greens Senator for South Australia, Sarah Hanson-Young, welcome.

Sarah Hanson-Young: Thanks for having me.

Matthew Abraham: On the phone, Kate Ellis, Shadow Minister for Vocational and Early Childhood Education. She is the Labor MP for the federal seat of Adelaide, welcome Kate Ellis.

Kate Ellis: Good morning, good to be with you.

Matthew Abraham: And Liberal Senator for South Australia, Education Minister Simon Birmingham, welcome to the program.

Simon Birmingham: Good morning, great to be with you.

Matthew Abraham: Simon Birmingham, will Malcolm Turnbull have to show political skills he has yet to display to now get his latest round of cuts, $6 billion worth of savings we’re told through Parliament? He says he’s going to reach across the aisle and work with Labor and the crossbenchers.

Simon Birmingham: Well I hope and trust that these savings measures will be legislated quite simply and easily Matthew because they are savings measures that we as a government outlined in the previous term of parliament, we took them to the election and lo and behold during the election campaign, the Labor Party said we agree with them, so if the Labor Party agreed with them during the election campaign, I trust the Labor Party will still agree with them after the election campaign.

David Bevan: Now you’re not playing any fun and games here, you’re saying every single measure in this omnibus bill, which amounts to $6 billion worth of savings, every single measure the Labor Party has agreed to?

Simon Birmingham: They are measures that the Labor Party budgeted on themselves as part of their costings during the election campaign.

Matthew Abraham: Kate Ellis that will be easy then.

Kate Ellis: Well we haven’t seen any legislation yet and obviously we will closely scrutinise any legislation that the Government puts forward, but let’s also be serious here, the biggest structural hit on the budget over the next decade is the Turnbull Government’s, I think, reckless proposal for $50 billion in tax cuts for big business and for the banks. Now before the election, Labor outlined a number of savings but we also did that so that we could repair the budget and also invest in schools, hospitals and Medicare and what we won’t be doing is letting this government go around cutting services that the Australian public rely upon whilst continuing to cut funding to schools, to hospitals, and attack Medicare.

David Bevan: But if you have agreed during the election campaign to every one of these measures, regardless of what else the Government might want to do, that could be fought on its own merits, but if you’ve agreed to every one of these measures, you’d have to let it through wouldn’t you?

Kate Ellis: Well as I said we haven’t seen any legislation yet.

David Bevan: No, no, but because you haven’t seen it yet, we are dealing with a hypothetical okay? That’s just the situation we find ourselves in. Is it fair to say that if these are identical to the cuts that are outlined by the Government before the election, to which you agreed, you’d have to pass them?

Kate Ellis: Well dealing with a hypothetical I’d say that Labor could have outlined savings measures during the election that we would support in order to divert those funds into our schools and hospitals. That doesn’t mean that we will support savings measures in order to divert those funds for big tax cuts for banks and for big business. They are two quite different propositions but of course we’re prepared to work with the Government and with all parties on responsible budget repair measures. I do think it’s a bit rich though for Malcolm Turnbull to be talking about reaching across the aisle when he can’t even get support within his own party room for some of the measures that he took to the election such as his superannuation changes and perhaps that’s the place that he should start first.

Matthew Abraham: Okay, Sarah Hanson-Young, will you grasp the hand that reaches across the aisle for the Greens?

Sarah Hanson-Young: Well actually we’ve got some serious concerns of what’s… if the Prime Minister’s being upfront and you know, we’d have to take it on face value until we see the legislation, but if this omnibus bill is all of the budget cuts that had been flagged and effectively banked by the Labor Party during the election campaign, looking at that list, there’s some very serious things in there that kind of went under the radar a little bit during the election campaign such as $1 billion cut to ARENA, the backing renewable energy and clean energy development, but one that I’m particularly concerned about is a $1.3 billion cut to unemployment benefits and that’s not to an increase in unemployment benefits, that is to the current level that people get today. The cuts are somewhere between $4.40 and $7 a week. Might not sound an awful lot of money to you or I or my colleagues in the parliament, we’re on good wages but for somebody on unemployment benefits, that is a big whack, $1.3 billion from people who are struggling to get back into the workforce.

Matthew Abraham: So you won’t touch that?

Sarah Hanson-Young: Absolutely not it shouldn’t be touched and Labor should absolutely reconsider, they should come out today and say you know what, we made a mistake we don’t think that’s a good idea, and we’re not going to start cutting people’s dole.

Matthew Abraham: Do you want to do that now Kate Ellis and save a press conference later in the day?

Kate Ellis: Well I appreciate Sarah’s advice on how Labor should manage our [indistinct]…

Matthew Abraham: [Talks over] Right but will you support it?

Kate Ellis: No I won’t be taking it.

Matthew Abraham: So you’ll support a cut to the dole of $1.3 billion?

Kate Ellis: No [laughs] no I don’t think I said those words at all, what I said is that we haven’t seen any legislation…

David Bevan: [Talks over] You don’t seem to be saying much that’s the trouble.

Kate Ellis: [Continue]…that the Government puts forward and we’ll have a look at it in detail. I think the Australian…

Matthew Abraham: But you’ll consider cutting the dole?

Kate Ellis: Well no I said we will look at the legislation that the Government’s put forward and we have serious concerns about the way that this government has managed both unemployment and the unemployed and we flagged during the campaign that we wanted to see a review of Newstart and the adequacy of that and what I’m not going to do is stand up and start making policy on the run without seeing any serious proposals.

Matthew Abraham: Simon Birmingham, Senator Simon Birmingham, is Sarah Hanson-Young correct that this will include a $1.3 billion cut to the existing dole, not to future dole payments?

Simon Birmingham: Well this is a $1.4 billion saving from removing the carbon tax compensation for all new welfare recipients so in fact that particular measure is of course redundant and the Labor Party was right in the election campaign to recognise that in the absence of a carbon tax that measure is redundant and we should…

Matthew Abraham:  [Interrupting]…for new welfare recipients not existing ones?

Simon Birmingham: That’s right. So we should be able to make that saving and really what we’re hearing from Kate at present, is a lot of filibustering. What would be nice to hear from the Labor Party is if the Government presents legislation that exactly mirrors what we took to the election, then the Labor Party will support it because that’s really what we’re saying we’ll do, that we will introduce legislation to say ‘these were bipartisan agreed savings measures during the election campaign’, now people like Chris Bowen have already said on radio this morning that if it does mirror what the Labor Party took to the election, then he would expect that they would support it because it’s what Labor’s policy was that they will support the implementation of Labor’s policy, Labor can of course reserve its right to oppose things where they differed with us during the election campaign but these were matters that were savings that they were happy to bank and when they were claiming that they had a responsible fiscal and budgetary approach, if they were happy to bank them for the purposes of the election campaign, they should be very happy today.

Matthew Abraham: Okay. Sarah Hanson-Young is this just removing compensation that’s no longer needed and it doesn’t affect existing recipients?

Sarah Hanson-Young: Well what has happened here is that a number of years ago when the clean energy package went through the parliament, compensation was paid to welfare recipients on a fortnightly payment. This saving cuts that away from people who currently receive it and stops new recipients from receiving it so that is why it’s actually a double whammy here because people who – as we know the unemployment rate is rising and there’s going to be more people who get a smaller amount per fortnight in their…

Matthew Abraham: Are you saying it affects existing recipients?

Sarah Hanson-Young: Yes it does.

Matthew Abraham: But Simon Birmingham…

Sarah Hanson-Young: And Simon Birmingham should be a bit more upfront about that or perhaps the Government hasn’t… their own ministers haven’t briefed their own cabinet members about the total extent and I understand that because…

David Bevan: But Simon Birmingham, you’re quite clear on this, it does not affect existing Centrelink benefits?

Simon Birmingham: No that’s right; my understanding is this applies to new welfare recipients…

Matthew Abraham: So you’ll have two classes of the dole? Some will be getting less?

Simon Birmingham: Well we are trying to do what is right by the budget by addressing…

Sarah Hanson-Young: [Talks over] 1.3, 1.3… I’m going by the figures in the paper today, 1.3 perhaps the… 1.4 it is but the… that is $1.4 billion of savings from people who are at the lowest end, they’re already below the poverty line, you know we want to talk about budget repair, we’ve got to be talking about tackling the big end of town and how do we raise revenue to pay for the essential services. That is not what is on the table today.

Simon Birmingham: Listen this is $1.336 billion and importantly funding from these types of savings or savings of this nature…

Sarah Hanson-Young: [Talks over] These people are living below the poverty line though.

Simon Birmingham: …Will be used to actually help fund the National Disability Insurance Scheme so we’re setting up…

Sarah Hanson-Young: So taking from Peter…robbing Peter to pay Paul.

Simon Birmingham: …in which we can actually fully fund the NDIS…

Sarah Hanson-Young: Robbing Peter to pay Paul.

Simon Birmingham: …there are gaps in terms of that funding at present.

Matthew Abraham: Simon Birmingham, federal Education Minister, you’d be aware of Vicki Thomson, she was a former Liberal staffer, and she’s now chief executive with the Group of Eight universities. On the front page of The Australian today there’s a report saying Vicki Thomson will be delivering a speech today on behalf of the Group of Eight in which she says some universities are not being transparent with students. Her speech will represent an unprecedented attack on other institutions in the sector which are funnelling thousands of students with low Australian Tertiary Administration Rates into taxpayer subsidised courses, which have poor job outcomes or which they may never finish. Do you think Vicky Thomson has got a point?

Simon Birmingham: Well I share some of the concerns that Vicki and the Group of Eight universities raised today, and I welcome their contribution to some of these debates, which is why I currently have a panel chaired by Peter Shergold, a former head of the Department of Prime Minister and Cabinet looking at university admission standards and transparency standards, it’s why I gave a speech last Friday in which I identified that there are a number of challenges we face in this space that we ought to address in terms of the way the financial incentives are currently structured for universities…

Matthew Abraham: [Interrupts] What does that mean? We’ve got a foggy morning in Adelaide, and we seem to be getting a high fog index from the federal Education Minister Simon Birmingham.

Simon Birmingham: No, no. It means, quite bluntly, that enrolling some students, universities can do at a profit. And of course universities are like any other institution, where they can make a profit, they often will enrol more students in those spaces. They use that to cross-subsidise research in some spaces, to cross-subsidise other student enrolments where they make losses…

Matthew Abraham: [Interrupts] Well, they’re using young people up, aren’t they? Are they not? That’s what you’re saying. They’re taking the dough, it’s not going into the course, it’s being used to prop up research and PhDs and so on. 

Simon Birmingham: In some cases, being used to subsidise other students where the current financial payments that the university receives actually are not sufficient or insufficient for the university’s need…

David Bevan: [Interrupts] Simon Birmingham, would you agree…

Simon Birmingham: [Interrupts] The whole reason we need some reform in higher education.

David Bevan: Would you agree that we have over the last, say, 20 years, we’ve had an enormous number of students who, all they’ve got at the end of their degree is a HECS debt. They were sold a pup by the university by slick marketing promising them great jobs, they didn’t get great jobs, they ended up back working at Myer casual.

Simon Birmingham: No, I wouldn’t agree with that as a huge generalisation, David. Of course there would be examples of that, and there would be examples through the system. But overwhelmingly, overwhelmingly, the growth in university enrolments and graduates has been a good thing across the Australian economy. It’s good for…

Matthew Abraham: [Interrupts] Okay. The universities aren’t- the big unis are not saying that. 

Simon Birmingham: Well, I think those big unis would not be suggesting that we want to be suddenly 10 or 20 per cent fewer students enrolled in the future. I think they are equally talking that there are some problems at the margins and we should address those problems.

Matthew Abraham: Kate Ellis, as Shadow. You’re well versed in education right from early childhood?

Kate Ellis: Well, I just think that we heard a whole lot of waffle from the Minister then. They’ve been in government for three years and what they have pursued is huge cuts to our university sector. And this is another example, there are examples right across the board where when the Government makes cuts, there are consequences, and people pay the price of those consequences. Now of course, we need to make sure we are admitting into appropriate people into appropriate courses, but we also need to make sure that our education system right from early childhood through to our schools, through to our universities is adequately funded so they don’t look at ways of raising money to- and people, real people end up wasting their time and wasting taxpayer dollars…

Simon Birmingham: [Interrupts] These are funding structures that your government put in place, Kate. The demand-driven system was a creature of the Labor government. 

Kate Ellis: [Interrupts] Simon, I let you waffle on for what seemed like hours. I’m just trying to…

Matthew Abraham: [Interrupts] He doesn’t want you to waffle on, I think.

David Bevan: [Laughs]

Kate Ellis: Matt, and what I’m saying is, there are consequences, there are human consequences, and the Government still can’t outline what is their plan for higher education, which is disgraceful.

David Bevan: To just breaking news, now, and we’re going to talk to Nick Xenophon in a moment and we’ll also talk to Sportsbet. Sportsbet are saying this morning, they’re going to cancel a multimillion dollar SA investment, and that is in a high tech centre they were going to set up in South Australia, and they are also going to end their ongoing sponsorship with South Australia’s Gawler racecourse because the Government is pushing ahead with what they call the punter’s tax, a 15 per cent tax on online bookmaking from South Australia. Simon Birmingham, is this Sportsbet playing hardball, or is this the way the world works? You tax us, well, why should we do you any favours?

Simon Birmingham: Well, I think for – and obviously these are matters for the South Australian Government to have to answer – but in general, if a state government puts up taxes in one area it should probably expect that it will probably see less investment in that area. 

Matthew Abraham: Nick Xenophon just joining us, South Australian Senator, Leader of the NXT party. This is the government trying to tax betting, and the bets- Sportsbet industry, are kicking back.

Nick Xenophon: Well…

Matthew Abraham: [Interrupts] A lot of jobs, lost, by the look of it.

Nick Xenophon: Well, that’s what the industry says, but the SA Centre for Economic Studies did an analysis of money lost on gambling compared to money spent on other sectors of the economy. $1 million lost on poker machines creates about three jobs, it’s six jobs created for every million dollars spent on retail, and even more jobs in hospitality. So I don’t think that argument really washes. And if Tom Koutsantonis has come up with I think a pretty ingenious way of raising taxes based on turnover of a betting industry that pays very little given the fact it’s based in the Northern Territory, which doesn’t have hardly any taxes are imposed on them up there, and that can help fund gamblers’ rehab, then that’s a good thing.

David Bevan: Yeah, in a minute we’ll talk to Ben Sleep, he’s chief financial officer with Sportsbet, about their announcement to pull out of their development that they were planning. But Nick Xenophon, we began this half hour asking senators Birmingham, Sarah Hanson-Young and Kate Ellis, the Member for Adelaide for Labor Party, about Malcolm Turnbull’s omnibus bill. This is a $6 billion dollar, it’s $6 million worth of savings. Will you accept that extended hand? Or will you first try and break a deal first on Arrium and then you’ll talk about budget savings?

Nick Xenophon: Well, we can do both parallel, but you cannot have a credible budget repair bill unless you tackle the issue of Arrium, because if Arrium falls over, the welfare bill for the Commonwealth will increase upwards of $100 million a year, the taxes the Commonwealth will collect from all the associated business and Arrium will collapse, possibly in excess of $100 million a year. There’ll be a massive environmental clean-up cost that the state government would have to prop up…

David Bevan: [Interrupts] So before – if we just cut to the chase here – before you will look at the omnibus bill, Malcolm Turnbull has to satisfy you that Arrium has been taken care of.

Nick Xenophon: Well, yes, because otherwise you’re not going to have much budget repair if you see a blow out in welfare costs and a collapse in company tax received…

Matthew Abraham: [Interrupts] So that’s a pretty big string you’re attaching to any support as he reaches across your…

Nick Xenophon: [Interrupts] Well no, it’s not a string at all. The economic case for some assistance to Arrium, whether it’s loans that are paid back when the business is up and running, that to me makes good economic sense and I’ve seen the analysis, I’ve spoken to the administrators at length, and it is something we cannot ignore…

Matthew Abraham: [Interrupts] Okay.

Nick Xenophon: You cannot let Arrium fall over.

Sarah Hanson-Young: Can I just…

Matthew Abraham: [Interrupts] Just quickly, yeah.

Sarah Hanson-Young: Can I just throw in here, and I think being able to negotiate on these things and putting up, you know, solid proposals for how we save Arrium and others are obviously a good idea. The issue here is that none of this is going to matter if Labor just line up and tick through these changes. We have to hear from the Labor Party today, the things that they went to the budget on, the budget cuts that they proposed – are they willing to stand by them or are they not? Otherwise, we’re all talking around the edges for no reason.

Matthew Abraham: Sarah Hanson-Young, Senator, thank you, thanks for coming into the studio this morning, on this fine morning in Adelaide. Senator Nick Xenophon, we thank you as well. And also Simon Birmingham, Liberal Senator for South Australia, and Kate Ellis, Shadow Minister for South Australia as well. Simon Birmingham there’s the Federal Education Minister.