Interview on Sky News Live AM Agenda with Kieran Gilbert  
Enterprise Tax Plan; Income tax relief; New child care package




Kieran Gilbert:             Let’s go back to that ad that I mentioned at the start, an attack ad on Malcolm Turnbull. And I spoke to Education Minister Simon Birmingham, and he said that Labor is clearly pulling no punches in the lead up to those by-elections.


Simon Birmingham:    Well, this is a very personal attack from the Labor Party. And you really have to wonder whether the likes of Anthony Albanese and Chris Bowen support this type of personal petty politics or whether in fact this is just another sign of desperation from Bill Shorten as he gets into the gutter in terms of the types of politics that he plays. Ultimately all Australians will benefit from a better company tax regime, a competitive one, rather than leaving Australia stranded having the second highest company tax rate only to Portugal in terms of OECD countries.


Kieran Gilbert:             But with the by-elections looming at the end of July, you must have anticipated that this was going to get intense in the sort of intensity you’d see at a general election. Because there is a lot of stake here, these by-elections as you well know.


Simon Birmingham:    Well look, by-elections, of course, are coming up now. No government’s won a by-election off an opposition since about the 1920s, so the Government’s perspective is we will fight hard to try to represent those people in those electorates. But our focus is on getting on with the job of governing. Now, the Labor Party doesn’t seem to care about good policy, what they want to do as an opposition, clearly, is to simply play petty personal politics. Well, it’s a contrast in studies in terms of the outcomes. The Turnbull Government delivering record jobs growth, bringing the Budget back to balance, ensuring that our trade discussions and negotiations continue to open up Australia’s access to the world, Malcolm Turnbull works to deal with Donald Trump or other world leaders to get the best outcomes for Australia. In contrast, Bill Shorten who just smears, plays petty politics, ignores the fact…


Kieran Gilbert:             But the Government- the Liberal Party no doubt, the Coalition will be adopting its own negative ads, that’s what politicians, that’s what parties generally do, isn’t it?


Simon Birmingham:    Negative ads that are centred around the policies and the track record of parties or leaders, this is about Malcolm Turnbull in a very personal way, the way that they’ve structured these ads. And of course it overlooks the fact that Mr Shorten himself is a major investor in AustralianSuper, has shares in all of the major banks himself, would actually have circumstances where he may financially benefit from passage of the Enterprise Tax Plan, as indeed would millions upon millions of Australians. So, the Labor Party comes to this very much with a fork tongue in the way that they address it. They try, of course, to smear Malcolm Turnbull but many, many Labor senators and members would have…


Kieran Gilbert:             But parties go negative because it works in a political sense, don’t they? That’s the blunt reality…


Simon Birmingham:    But there’s a difference in this. This is not standard negativity, this is personal smearing on the Labor Party’s behalf. And that is really where frankly if Bill Shorten was half a leader, he would come out today, distance himself from these ads, say they will not be run or aired. But indeed, I suspect that they’ve all been done just to generate a bit of free media coverage, just to ensure that we’re doing exactly what’s happening now and talk about it. And would the Labor Party really put big dollars behind these ads or are they just using it for a distraction right now? Because of course Bill Shorten is worried about Albo stepping up behind him…


Kieran Gilbert:             Do you think that would be counterproductive anyway if they were rolled out more broadly, is that your view?


Simon Birmingham:    Look, I think Australians turn their nose at these sorts of very personal, petty attacks. They know that we have a robust democracy and the politics is robust. And we highlight the negative risk of Labor. And the negative risk of Labor is very real, you won’t get record jobs growth under Labor, you won’t get the budget in balance under Labor, you will get boats coming back under Labor, and there are some very real threats if a Bill Shorten Labor government is elected. We’ll highlight those but we’re not going to Bill’s actual personal circumstances, like they are.


Kieran Gilbert:             The ReachTEL poll that was released today by The Australia Institute shows that you’ve got an uphill task in terms of convincing people still in Mayo, in the Adelaide Hills, ahead of the by-election there. Only 25 per cent of people support the company tax cut. In Longman, 33 per cent support a company tax cut. In Longman, it’s 50/50 on a two party basis as well according to ReachTEL. So it is going to be close but on company tax, it remains a political negative.


Simon Birmingham:    Well, as a government, we don’t run policy based on polling, we run policy based on what’s in the best interest for Australia. And it’s certainly not in Australia’s best interest for Australia to have the second highest OECD tax rates in the world. Not in Australian’s interest for Australian companies and employers to find that only Portugal is less competitive than them and that everybody else is more competitive than Australia. That’s not going to attract investment to Australia, it’s not going to help Australian businesses to grow, it’s not going to help jobs. That’s why we need this tax reform, to make sure that we actually do build on what is now a record level of jobs growth under the Turnbull Government. But we want to cement that and we want to see it turned into wages growth…


Kieran Gilbert:             Were you surprised that the income tax cuts didn’t have some sort of positive boost to the Ipsos poll more generally? It’s 53-47 still, the Coalition trailing Labor. Did you think that there might have been some sort of positive boost in the numbers there?


Simon Birmingham:    Well, the income tax cuts only passed the Parliament last Thursday. We’re going to, of course, work to make sure that we sell that message and all our other messages between now and an election next year when Australians will face a strong choice. And it’s a choice of a government with a very clear track record now of jobs growth, of bringing the budget back to balance, of offering tax relief to Australians. Or Bill Shorten’s alternative, which frankly Australians can’t afford. Bill Shorten and the Labor Party want to see Australians pay $70 billion more tax on their wages, billions of dollars more tax on their houses, billions of dollars more tax on retirees’ savings, billions of dollars more tax on electricity. That is just something that Australians cannot afford. That will be the debate for the next election.


Kieran Gilbert:             You are- obviously in your area of responsibility is child care, you’ve got this new subsidy coming into effect as of 1 July but at the same time child care centres jacking up fees. Is this going to eat into the very reform that you’ve been trumpeting now for months?


Simon Birmingham:    Well, Kieran, these are the biggest improvements to child care subsidy systems and payments in around 40 years. And on our modelling and assumptions, Australian households are going to be around- 1 million Australian households will be better off. And on analysis to date, we can see that those households will be better off on average to the tune of $1,300 per child per annum. That’s a big improvement. Now, all of that modelling is based on an assumption that on 1 July, as there is every year, there will be some fee increase. But I would encourage parents to make sure they monitor what their child care centre is doing. I know it’s not easy to change centres but frankly we should not see excessive fee increases. Modest fee increases on 1 July are the norm.


Kieran Gilbert:             Is five per cent modest? Because it looks like that’s the sort of rough number, about five per cent.


Simon Birmingham:    That’s close to what’s been modelled into the forward budget assumptions. It’s probably at the high end though if you look at what inflation rates are at. Anything that’s going well above that I think is something where as a government we will be monitoring price movements very carefully. And don’t rule out asking providers for reasons as to why they’ve taken certain steps.


Kieran Gilbert:             Okay. So, the child care centres bumping up the prices of about five per cent – a bit under, a bit over – that won’t necessarily negate the impact of the child care subsidy reform?


Simon Birmingham:    No because those sorts of assumptions have been built into models to start with. What we have put in though, as the Productivity Commission recommended, is an efficient pricing mechanism within the new child care subsidy, which we expect over time will ensure that fee increases are far less than they have been in the past. Previous times we’ve seen fee increases hit up into the teens when the Labor Party was in office, we brought that down to a more controlled level now. And of course we believe based on the Productivity Commission’s advice the new efficient price mechanism will keep fee increases at a lower rate than they would otherwise have been, into the future.