Subject: Party Leadership; economic reform


KIERAN GILBERT: Good morning and welcome to the program. It’s coming like a freight train, that was the view of one Abbott Government Minister in relation to the prospect of a Turnbull challenge. Just when is it going to happen though? There is certainly a sense that it is inevitable, but could it even happen this week. With me to discuss this and the other issues of the day, we have Labor front bencher, Michelle Rowland and Assistant Education Minister, Senator Birmingham. Senator Birmingham, could a challenge eventuate this week?

SIMON BIRMINGHAM: Well Kieran look, I’m not particularly interested nor intending to feed speculation that is out there, speculation is unhelpful for the Government and frankly I, and I’m confident most members of the Government, are completely focussed on the jobs we have and those jobs are to make sure we grow jobs across Australia, which we are doing incredibly well, that we strengthen growth in the economy so we can create more jobs around Australia and that we enhance community safety for all Australians.

KIERAN GILBERT: The report last night by Laurie Oakes that the Prime Minister, it is the view of senior figures within the Government that the Prime Minister had discussed and raised the idea with Rupert Murdoch the idea of a snap election after the Canning by-election has spooked some within the Liberals. I’ve been told that the Prime Minister himself did not raise that prospect of an early election and that, in fact, those close to Mr Abbott playing down any such idea, what is your take on that?

SIMON BIRMINGHAM: Conversations that are had in private meetings are conversations that can only be confirmed by the participants in those private meetings and I have no idea what was said in that meeting. It is, of course, always in the domain of a Prime Minister to call an election at a time they believe is right for the country, but as a Government, we are not focussing on elections, we are not intending to have early elections to my knowledge. We are focussed on getting on with creating more jobs for Australians and we have a good, strong track record of employment growth far outstripping that of the previous Government. We have our challenges in terms of what’s happened around the world with the slow down in China, with the dropping of iron ore prices. They are, of course, putting pressure on different things, but jobs growth is still strong and that is fundamental to this Governments reforms and to the small business packages we had this year.

KIERAN GILBERT: Just in relation to that quote from a Minister who I wouldn’t say is a, quote, Turnbull supporter, that it is inevitable and it’s coming like a freight train, an individual that wasn’t of the view that a spill motion should be supported in February, now suggesting that that’s the case and that Turnbull should be Prime Minister. This is something that has been put to me by a number of Liberals, including those of what is called the right within the party.

SIMON BIRMINGHAM: Many things are claimed by people at times to be inevitable. I don’t think you can ever say that anything outside of elections and budgets in politics are necessarily inevitable and I’m not much of a trainspotter either, I’m somebody who thinks we should be talking about policy, talking about economic policy, talking about how we make sure we keep growing jobs and deal with the challenges Australia has and, as a Government, that’s what we are focussed on. We had great success over the first couple of years in terms of dealing with the border protection issues we had and stopping the boats, we’ve had good success in rewinding the carbon tax and repealing the carbon tax and the mining tax and delivering small business tax cuts and making sure we don’t proceed with Labor’s banking tax, in growing jobs, all of those things are positives for Australia, they are starting to pay some dividends, we need to keep the focus on economic reform and make sure that as a country we are well placed for the challenges we face in the future and that’s why things like the free trade agreements, which Labor are so recklessly opposing, are so incredibly important to the future.

KIERAN GILBERT: Michelle Rowland to you, are the internal deliberations and the ongoing tensions within the Government disguising an opposition that is, in itself, got some significant issues to deal with ahead of an election year?

MICHELLE ROWLAND: Kieran, we’re ready for an election whenever that might be called. We have a good suite of policies that we have already had costed and are ready to take to the Australian people, but I think the focus today on Malcolm Turnbull seeking to fulfil his destiny to become Prime Minister combined with the fact that despite what Simon might say about them having a good two years and he talks about economic management, debt and deficit up, growth down. On all these indicators where the coalition are supposed to be superior, this has not been a good performing Government so Tony Abbott is in this position where he has not delivered over two years and bear in mind, you know, I remember vividly, you know, being thrown out of office in 2013, but there was not love for Tony Abbott then. He didn’t have capital with the electorate then, he certainly has burnt any remnants that might have been remaining and people are now looking for alternatives and the conundrum they find themselves in and I would say this: Tony Abbott may be unpopular, Malcolm Turnbull may look like a reasonable alternative in some people’s eyes, but have a look at this bloke’s track record. He’s almost doubled the cost of the NBN since he announced their version in 2013, didn’t deliver it, isn’t going to deliver it on time – supposed to be by the end of next year, that’s not going to happen. This is a bloke who talked a big game when he was in opposition just like Tony Abbott talked a big game when he was in opposition; none of them have delivered.

KIERAN GILBERT: Senator Birmingham, your response to some of that in terms of the person that is mooted as the possible candidate or likely candidate, that being Malcolm Turnbull, but you can hear Labor already having a crack at his record, it is not going to be an easy run for him even if you do move to him.

SIMON BIRMINGHAM: Well Malcolm is a strong member of the team who inherited a complete basket case in the NBN where cost blowouts were already spiralling, where it was self-evident that Labor’s model was not able to be delivered and certainly not able to be delivered without, in the end, running in to many multiples of what was initially forecast as the cost. So, Malcolm is a great member of the team…

KIERAN GILBERT:…would he make a good leader?

SIMON BIRMINGHAM: I’m not going to buy in to those comments. I’ve made it very clear, Kieran, that I don’t think it is helpful to add to the speculation, I think it’s a Government on a strong record that actually has delivered many of the things we talked about before the election…

KIERAN GILBERT: …What about some of your colleagues like Andrew Nikolic who texted Malcolm Turnbull on Friday morning and called on him to make a public statement in support of the Prime Minister? I’m told that that was not of the Prime Minister’s request, that Mr Nikolic did this off his own bat, the Deputy Government Whip, and he texted Mr Turnbull “come out and express your support for the Prime Minister” and this followed that story, the reshuffle in the Daily Telegraph, and Mr Nikolic apparently was advised that this was a Telegraph story and that Mr Turnbull doesn’t have the closest links to the Tele within the Government so you’re saying that basically you should be sending your messages elsewhere.

SIMON BIRMINGHAM: Well I send text messages from my phone, Andrew sends text messages from his; you can ask Andrew about his. Again, I would say that as a Government, I’m convinced that we are appropriately focussed right now on jobs and growth. We’ve done the job in terms of making sure we stop the boats and secure our borders, it is a great accomplishment and the Government can be proud of that and, of course, that work never ends. We have achieved lower tax base for many Australians…

KIERAN GILBERT: …But should your colleagues be urging Turnbull to come out and rule out a challenge, is that something that’s helpful?

SIMON BIRMINGHAM: Kieran, you can want to talk about the internal discussions of colleagues all you want, I’m not going to engage in those discussions, I’ll happily talk about policy issues. There is a fabulously thoughtful policy paper out today by Deloitte Access Economics talking about tax reform, that’s the type of discussion we should be having in this country as to how position Australia for the future.

KIERAN GILBERT: Ok, well let’s move to that because despite my efforts, I haven’t got you to elaborate on that too much this morning, wanting to focus, understandably I guess, on the policy issues…

SIMON BIRMINGHAM: …Australia’s challenges are policy challenges.

KIERAN GILBERT: Indeed and this is a thoughtful contribution from Chris Richardson and Deloitte Access Economics. You can raise the funds, provide compensation and reduce the company tax rate with the revenue generated by the GST; this guy is a very, very well respected budget watcher.

MICHELLE ROWLAND: He is well respected, but I would say two things to that, Kieran. Firstly, reform in and of itself isn’t about increasing a regressive tax and that is what this Government seems intent on being focussed on. Whenever they talk about reform, they always talk about increasing the GST as a starting point; that is not our starting point. Our starting point is, as I mentioned before, reforming some of those issues of multinational tax avoidance and also high end superannuation. The second is, although you know Simon might want to latch on to this, we only had in the last couple of weeks, Joe Hockey coming out and saying, Oh we can increase the GST to fund income tax cuts. There is no plan here from this Government, so although we might have…

KIERAN GILBERT: …This is not a Government document, this is Deloitte Access with their ideas…

MICHELLE ROWLAND: I acknowledge that and my ideas, as a member of the opposition is that we should not be focussed on increasing regressive taxes that only serve to make sure that the people who least afford it end up paying the most.

KIERAN GILBERT: Except if it’s the carbon tax, which you were happy to introduce.

MICHELLE ROWLAND: You need to remember though, Kieran, that we had a very generous assistance package…

KIERAN GILBERT: …Well that’s what they’re talking about here, that’s what he’s saying just here, what’s the difference?

MICHELLE ROWLAND: The difference here, Kieran, is that the clean energy package was about reforming the economy as a whole; it was about moving industries…

KIERAN GILBERT: …Well that’s what this is as well, to make it more competitive.

MICHELLE ROWLAND: This isn’t about moving a whole sector of the economy towards a new way of functioning. That is precisely what the clean energy package was about.

KIERAN GILBERT: What it is about though is making the economy more efficient and to generate more competitiveness in terms of our business tax take, 25% would make us more competitive, and as Richardson argues, that would benefit middle Australia because the companies invest more in infrastructure, employ more, train more, the work is better off.

MICHELLE ROWLAND: With all respect, I don’t see this as the answer to making us more competitive and more efficient. I think that we should be investing more than anything in two sectors. Firstly, studies will consistently show that in order to improve a country’s productivity, you need to have great investment in ICT. We don’t have an ICT plan in this country, we have an NBN that is going backwards under this Government and secondly, you don’t do it by hitting the people that can least afford it and then saying that we’re going to have compensation…

KIERAN GILBERT: …Richardson is saying that you can make them better off in terms of the compensation, that’s what he is saying, Chris Richardson, his starting point was to make those on low incomes better off.

MICHELLE ROWLAND: You can also make people on low incomes better off by ensuring that we have a pension and an income retirement system that is in place.

KIERAN GILBERT: But how do you pay for it?

MICHELLE ROWLAND: We’ve already outlined in our, one of our first policies that we’ve released, in terms of the high end concessional tax rates on superannuation, how we can do that…

KIERAN GILBERT: …Well that’s part of it. Let’s bring in the Minister now, you said it was a good contribution before, Finance Minister Cormann also said that, it looks inevitably that the Government is going to head in this direction and make the case for an increased consumption tax.

SIMON BIRMINGHAM: Well the Government is going through the right process for formulating what is a complex area of policy and that is the development of a tax reform white paper which will be the foundation of what we take to the next election and importantly we will look at contributions like this and consider their merits and give them the appropriate thought that we should give them because what Chris Richardson is arguing is that you can take inefficient taxes that are disincentives on investment and economic growth in Australia and remove their impact on the economy and create greater wealth for everybody by having a more efficient tax structure. Now that of course, is an appealing argument. Of course, as a Government, we would want to make sure that Australians who are less well-off were not disadvantaged by any tax reform. That has to be your starting point of any discussion…

KIERAN GILBERT: …But you’re open to the idea of this as a measure to make the tax take, the economy more sustainable?

SIMON BIRMINGHAM: I guess the type of discussion that we need to be having, it is the type of paper that is a valuable input as we finalise the green paper on tax reform that will lead in to that final white paper and I would encourage other think tanks and other bodies around Australia to make their contributions in a similar ilk because I trust that we are a Government that is open-minded to serious economic reform, open-minded to the type of tax reform that can ensure Australians are richer and better off in future, that does look after the less well of, but also tries to grow the pie for all Australians and that’s exactly what Chris Richardson is talking about.

KIERAN GILBERT: Senator Birmingham, appreciate it Michelle Rowland as well, thanks have a great day.