Topics: Baby Bonus and tariffs
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Van Onselen
…joining me now out of Canberra is Senator Scott Ryan and Nick Champion and Senator Fiona Nash welcome aboard, thanks for your company. Senator Nash, I’ll start with you if I can, right off the bat I was going to have Barnaby Joyce on the program, not to say I’m not happy to have you here, but I have this concern that he was pulled by the leader’s office. That’s what was told to me, the reason was because they don’t want him talking about the Baby Bonus but luckily being the good National you are, you’re willing to do so I hope. What’s your view, there seems to be some dissent there in the National Party given the plans to scrap it from Joe Hockey and Tony Abbott?
Senator Nash
Well firstly, I suspect Barnaby has never been pulled off doing something that he wants too. If he’s not here I suspect there’s an extremely good reason for it, that doesn’t have anything to do with the leader’s office pulling him out. Look there’s obviously been some discussion around the Baby Bonus, as there is with many things in the Coalition, so that’s not surprising.
Van Onselen
Fair enough but what’s your view, in your opinion do you think the Baby Bonus shouldn’t be scrapped should Tony Abbott be lucky enough to be Prime Minister?
Nash
I don’t think the mechanism for making sure there’s focus and some support for stay-at-home mums really matters if the Baby Bonus stays or goes. It’s a long way to the election. I would like to see some recognition for those mothers who choose to stay-at-home with their children. I was a stay-at-home mum for some time, it’s a long way to go until the election and I think we’ll have some discussion around that.
Van Onselen
Where’s the National Party left on this one, if the situation is left where the Liberal Party will obviously have the comfortable majority of Coalition MPs. If they just overrule the National MPs, you’re not in a position to be able to do much about it and where does it leave your front benches that are bound by Cabinet solidarity?
Nash
As I say we can see the merits in the PPL that Tony has put forward by the way of the workforce productivity commission. I don’t think there’s a huge issue here, I think there’s a lot trying to beat it up into a big issue but not for us, it certainly isn’t.
Van Onselen
Let me go across to you Senator Scott Ryan, I’ll just ask you before we get to tariffs. Just quickly, Barnaby Jocye’s office was happy to send me an example of the function invite that he had tonight. It started at 6pm, boy oh boy the Senator is planning to kick on – it’s already 8:30pm.
Senator Ryan
I don’t think anyone has successfully told Barnaby that he cannot sell his message to the people and I’ve only known him five years. Barnaby’s working hard, he’s running for the seat of New England and frankly if he’s out at functions meeting people, voters, businesses, stakeholders in that part of Australian, then that’s probably more important than being here with us.
Van Onselen
It’s a hell of a function Nick Champion if I can ask you. It started at 6pm and at 8:30 it’s still going on for the Liberal for Canberra person, Tom Sefton.
Nick Champion
Well look the Nats and the Libs say that Barnaby can’t be silenced but it’s quite plan that Barnaby has disappeared from public view and the reason for this is not just because he’s busy running for a lower house seat, it’s basically that he’s a liability. He’s likely to speak his mind if you ask him a question, so that’s why he’s not on tonight.
Van Onselen
He hasn’t been silenced from public view in fairness to Barnaby. He was on page three of the Australian defying the Liberal Party about the Baby Bonus.
Champion
Yeah and if he came on this program then he’d be doing the same and they don’t want you to see that. They don’t want you to have a philosophical argument out in the open because this matter has become the proxy for the great philosophical tension within the Liberal Party which is between free traders like Scott and the sort of DLP, National and Santamaria crowd which have slowly but surely invaded the ranks of the Liberal Party.
Ryan
I think we need to let Nick take a breath here because only someone from a capital city would say that someone has disappeared from view because they are campaigning in regional Australia, it sort of portrays Labor’s mindset at the moment. I went to the same school as Santamaria so I’m not sure…
Van Onselen
…that’s a nice line Senator but it’s a legitimate question, you’re going to win government in less than 100 days’ time, I know you won’t be as sure of it as I am but you will win and win comfortably. Now when you do there will be tensions here even just based on what Senator Nash said just then in relation to the Baby Bonus.
Ryan
I’m not going to let your presumption go past without comment Peter. We have only come from opposition to government three times in the history of our party and we’re 75 years old. We don’t underestimate the task ahead of us. Another word for what you describe is diversity, there is strength in the Coalition because of diversity and I’m not going to be lectured about internal tensions by a member of the Parliamentary Labor Party that for the last five years has torn itself apart in public over and over again.
Van Onselen
Nick Champion, that is hard to argue I’ve got to say. At the end of the day, I think they’re going to be some interesting philosophical differences between the National Party and Liberal Party and the Leader’s Office intervention, even if Barnaby had a function that he wanted to spend a few hours at, none the less it pales into insignificance compared to what we’ve seen on your side of politics over the last four or five years?
Champion
Well one thing we all agree on is the Liberal Party will pay very wealthy people $75,000 per year while you pay people on the minimum wage $30,000, and it’s unfair. If the government was to implement such a scheme that would be unfair and to fund it with a corporate tax that would flow through to every shopping centre and every price in the economy, then that would be amazingly stupid.
Van Onselen
Let me ask Senator Nash about it. Do you agree with Nick Champion that, that amount of money would be unfair? Darren Chester your National Party colleague does take that view.
Nash
Oh look I think to be fair Darren made some comments about having everything on the table when it came to assistance for families having children between now and the election. So I think to be fair we need to look at exactly what he said and not paraphrase what he said. Look we’ve had some discussions about stay-at home-mums and work from home mums, I can certainly understand where Tony Abbott is coming from when he puts forward the work place productivity there has to be recognition for these mothers who are working and taking time out who make an enormous contribution to the economy and that needs to be recognised. I can understand what he says but at the same time we need to look at stay-at-home mums as well.
Van Onselen
What’s your view? Do you think a woman receiving $75,000 for six months off work from the government fair at the same time a stay-at-home mum, as you say you were once upon-a-time, not receiving the $3,000 as it’s dropped from $5,000 under the plans from Joe Hockey?
Nash
I’ve spoken to a lot of people out there in the community and they are very, very supportive of what Tony has put forward. They actually see the merit in it and they are very supportive of what he’s put forward. I’ve done both Peter, I’ve been a stay-at-home mum and a working mum, so I see it from both sides and that’s why I think we need to look at both types of families, both types of mums. We need to make sure working mums are recognised and that stay-at-home mums are recognised as well.
Van Onselen
Alright stay with us. We’re going to take a commercial break and when we come back where going to start with Nick Champion, who can a new and young member of the Labor Party be such a dinosaur on tariffs? We’re going to ask him in a moment.
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Van Onselen
Welcome back to Showdown. I’m talking to National Senator Fiona Nash as well as Senator Scott Ryan and Nick Champion for the Labor Party. Now Nick let me start with you, I did mention your position on tariffs – writing about it causing a bit of a stir. What’s going on? Is this straight-out parochialism for your home state or do you actually think tariffs will work, or is this your ideological belief that this is the way to go over the next 10 or 20 years?
Champion
Well neither. I made the observation that we face a situation that largely we haven’t found in the last 40 years of free trade orthodoxy. We’ve got a floating currency and normally it goes up and down and during the Howard years it was largely down around 48 cents which was great news for the car industry because they exported Monaros and re-badged Pontiacs to the United States during that period. Obviously we now have a very high Australian dollar and it’s high for a reason that’s beyond the economic fundamentals of the economy. So commodity prices have come off but for the first time the economy hasn’t followed those commodity prices, instead it stayed high because Central banks around the world and currency speculators have invested in Australian assets and the Australian dollar and that’s kept the Australian dollar artificially high…
Van Onselen
…can I just ask a question though, would tariffs have saved Ford?
Champion
Well no because Ford did not have an export model but what I thought and wrote about this before was the sad demise of domestic production at Ford. What I was trying to alert people too, was our dollar is very high and not good for economic fundamentals but rather because of speculation of a safe currency in world markets and secondly we’ve got nearly all our major competitors – Germany the US and Japan printing money like mad which lowers their currency to an abnormal level and that’s creating a hyper-competitive market. Under world trade market rules we have every right to impose a short term tariff to protect the fundamentals of our car industry to protect and prevent massive short term dislocation and that’s the argument I was making. Not for endless years of protection, not for inefficiency but rather a short term pragmatic tariff to help industry get through what’s an abnormal situation.
Van Onselen
Senator Scott Ryan, how do you respond to that suggestions right there by Nick Champion?
Ryan
Well I agree with his analysis of some of the problem. The dollar is high; it’s making life difficult for the exporters, particularly of manufactured goods. We have got other countries printing money to devalue the value of their currencies but he’s diagnosing a solution to that which will actually harm Australia. No one can explain how making a Mazda 3, the second most popular car in Australia, a $1,000 or $2,000 more expensive helps anyone. It’s as if the other side is cheating so I’ll put some lead in my saddle bag so it’s harder for us as well.
Van Onselen
I think he’s arguing it helps those other workers who lose their jobs that are trying to compete against the less expensive Mazda because of the high Australian dollar.
Ryan
Well let’s go and look at this. Does anyone think, Nick or some of his colleagues proposed a tariff of 5% I think, if the dollar was 96 cents or above and it dropped below that today. So let’s say we make a Mazda 3 $1,000 more expensive with a 5% tariff. We already pay a 5% tariff on it, that’s not going to do anything to save Ford or Holden. The issue we have got here is our manufactures need to be competitive. We’ve had transition plans in place which have been supported by both sides of politics to try and make our manufactures compete since the days of the Button car plan but the point about tariffs is they don’t work. 30 or 40 years ago in the 1970s our dollar was well above a dollar US and then by the 1980s we had tariffs in the order of 80%, the most inefficient car industry in the world and one that went through a great deal of adjustment. The piece I wrote this morning was a personal story because my dad was one of those people who lost his job during the 90s because he worked in the trucking industry. Tariffs don’t work and they’re a bit like budget deficits when people say we need some stimulus spending – they say they’re temporary but once they come on they don’t go away.
Van Onselen
Nick Champion, is the Senator right? Do tariffs not work along the lines you’re talking? He says they wouldn’t have saved Ford, you agree with that. He says they probably wouldn’t save Holden, I assume you disagree with that?
Champion
Well I think its nonsense. The rest of the world have used tariffs for a precise reason that they do work and they do protect industry and if you do make imports more expensive it shows that people are more likely to buy an Australian made car. Now I do agree…
Van Onselen
…is that fair to the consumer though? That’s what Scott Ryan is getting at there. How are people better off if these cheap cars are affordable and suddenly there not affordable and they have to buy an Australian made car – even if Australian manufactures will benefit by holding on to their jobs because of it.
Champion
It’s a delicate balance and I wouldn’t support going back to a 57% tariff which is the highest car tariff that we had. That would be detrimental to consumer interest. I think there’s a good argument, and I think most Australians accept it, that at times like these we should protect Australian industry because there will come a time when the mining boom comes off and when our dollar comes down and we’ll look to our manufactures to export again. That’s the sort of time Holden will roar back into action, by exporting things like police cars to the US and large luxury Sadans to the Middle East and then we’ll all be crowning about their success. You do need manufacturing as your base in an economy because it generates investment, it generates jobs, in generates development. It’s really in terms of Southern Australia in Victoria and South Australian it’s been the heart of our economy. To lose Holden from South Australia would cause a recession because it would rob us of up to 16,000 jobs and literally a couple of percentage points of gross State product.
Van Onselen
Let’s be honest here South Australia is a boring State people live there mostly for that reason but Senator Nash let me ask you. From a National party perspective where do you fall on this issue because Scott Ryan took aim at the Labor party in his piece today but he also had a crack at your former leader Black Jack McEwen. The National party have been mostly supportive of tariffs, what’s your view?
Nash
And what a great leader Black Jack McEwen was. Scott and I have certainly had discussions on this over the years too. My view on this is pretty simple – I get sick and tired of watching this Labor government pick and choose which industries and which works they say they’re going to support. Now if you look at the agriculture sector, it’s about 12% of GDP, it contributes about $155 billion to the nation’s economy and yet we hear not a peep form this Labor government in terms of support for those farmers from the agriculture sector, which is facing exactly the same problems as the car industry because of that high Australian dollar. We have to remember when the GFC first hit in the first quarter it was agriculture that held-up the nation. So my view is I get sick and tired of this Labor government being so city-centric and paying absolutely no attention to what we need in rural Australia.
Van Onselen
Your concern is you think the Labor government are too city-centric, so you’d like the Coalition to be more country focussed?
Nash
Well I think a Coalition government would be more country focussed absolutely, there’s no doubt about it. The Nationals exist to be there for rural Australians in the Coalition. The Coalition would be far better for Australia than this Labor government. I think if you look at things like the Carbon tax, the snap-like export ban which decimated the north of Australia which the Prime Minister referred to earlier this year as ‘short-term-pain’. There is absolutely no doubt that a Liberal/National government would be much better for rural Australia.
Van Onselen
Scott Ryan you wanted to say something a moment ago?
Ryan
I just wanted to say, what Nick is walking away from here is 30 years of economic reform. The Labor Party as John Howard, Peter Costello and Tony Abbott have said have had a very important role in. One of the reasons our economy has weathered global economic storms is because the change when we undertook the economic reform program during the 80s and 90s. Critical to that was the lowering of tariffs and the freeing-up of markets. We wouldn’t have the mining boom of today, if we still had the old protected industries because all our labour and capital would be tied up in unproductive places. I agree entirely with Fiona, the Country Party was first established as a free trade party, the leaders of the free trade movement in Australia were the leaders of the National Farmers Federation….
Van Onselen
…be honest Senator, there’s been more than them…
Ryan
The National Farmer Federation, Tim Fischer, John Anderson. These people were committed to it because they understood that it was regional Australia that for decades was bearing the cost of protection that benefited the cities. That was one of the great iniquities in Australia – regional Australian paid the price for tariffs.
Van Onselen
What about Barnaby Joyce?
Ryan
I’ve had lots of discussions with Barnaby and I’ve never heard him say we should impose tariffs. This would be a retrograde step and just because Nick says the rest of the world does it, it harms the world. Tariffs are economic self-harm. They are proven to cause costs to the people who impose them. I wish other people would reduce them but I know we are better off without them regardless of what others do, and Australia’s strength over the last 30 years is testament to that.
Van Onselen
Nick Champion can I ask you a question, we’ve had a tweet that’s come in by somebody who I think is being serious they say, why don’t we just change the road rules to allow centre-wheel-drive cars only, that way only Australian-made-cars would dominate on the road? That sounds like the kind of thing I can imagine the Labor party adopting.
Champion
It’s a bit of a weird tweet but look, just getting back to what Scott said. No Coalition government has ever cut tariffs…
Ryan
…yes we have…
Champion
It’s been the Whitlam government and the Keating government that cut tariffs and Howard had tariffs at 10% and it didn’t harm the economy greatly. That’s all I was talking about returning tariffs to Howard government levels. So I find the hysterics about turning our faces against economic reform to be a little over blown. What I’m talking about is dealing with a short term problem in a practical way and I think the problem with free traders and you read them on the pages of the Financial Review – they’ve got the Modest Member column. They’ve got a bunch of them trying to hark back to a battle that’s largely been won. We are a free trading nation but we’ve got to be a practical one and if we want to keep a car industry, we’ve got to give them assistance….
Ryan
…we give them assistance but we do it in different ways…
Champion
…these are the rules the rest of the world play by…
Ryan
…We are giving them assistance in different ways. What Nick is arguing for is that everyone who chooses a car for their needs would pay thousands of dollars in extra taxes than they have to pay. That’s what Nick is proposing.
Van Onselen
Let’s move on guys. It seems like Barry O’Farrell is the worst friend a Federal Opposition leader could have, in terms of his views on Gonski and in terms of your attitude of not wanting States to sign-on.
Ryan
I wouldn’t agree with you there at all Peter. I’ve been in Senate Estimates yesterday and today and we couldn’t even get some basic answers out of the Department of Prime Minister about the so called Gonski reforms. This has clearly been a political campaign by the government and when you ask of details, as the NSW education minister was in Canberra today doing, people don’t seem to be able to get a hold of it.
Van Onselen
So is NSW just crazy to sign-on without all the detail you’re talking about? They’ve already signed-on even though they don’t have that detail you speak of?
Ryan
They do what they deem is in the best interest of their State, that’s why we have a federation Peter.
Van Onselen
You say there’s no detail there yet they’ve signed-on. Would you have signed-on if you were in their position?
Ryan
I don’t run State schools, I don’t run a school system and I don’t think Canberra should Peter, I’m in Federal politics. What the States do is entirely up to them, they know their school system better. The questions we have as federal politicians are around guarantees and funding levels and guarantees particularly for people who choose non-government schools for their children – we are not confident in that.
Van Onselen
Senator Fiona Nash let me ask you before we run out of time. What’s your view on this because at the end of the day you have to pick don’t you. It’s either Barry O’Farrell did the right thing by Australia in terms of his decision to sign-on to Gonski or he did the wrong thing in which case at a Federal level you guys are right to not like the Gonski reforms, which one is it?
Nash
No it’s not black or white Peter I would completely disagree with you there. Certainly Barry O’Farrell and Adrian Piccoli, the NSW education minister, have worked through and looked at a number of models and how it applies to NSW. Now, they are at perfect liberty to look at how they think it will work for their State. Our job as Federal parliamentarians and the Federal Coalition is to have a look at it as a national plan – how is this going to roll out, how will this actually work. There’s still a lot of detail missing as Scott referred to, now Christopher Pyne is right when he says if it’s not a national plan we are not going to sign-up to it. So we have to make sure we’ve got the detail as the Coalition to make the right decision from a national perspective, what NSW has done is base their decision as rightly they should, and any State should do this, on how their State is effected by how this particular program will roll out.
Van Onselen
Alright Fiona Nash you got the last word, we are right out of time. Thanks very much for joining us on Showdown, same to you Senator Scott Ryan and Nick Champion as well. I appreciate your company. Thanks for watching, Barnaby Joyce is back from his function I hear, so thanks for tuning in at the last minute. See you next week.
(Ends)