Subjects: 2016 Federal Election; details of party policies.

EO&E………………………………………………………………………………………………………………………….

RAF EPSTEIN:

The panel here for Fight Club, they’re terrified I’m going to ask them a bit of policy detail they don’t know. Tim Watts is the ALP’s member for the seat of Gellibrand, Tim, welcome.

TIM WATTS:

Great to be here, Raf.

RAF EPSTEIN:

He’s not sure, if he’s (inaudible). Scott Ryan is the Liberal Senator for Victoria, they’ve got a few, but he’s the one we’ve got, and he’s the Minister for Vocational Education in Malcolm Turnbull’s Government. Scott, welcome.

SCOTT RYAN:

Thanks Raf, Tim and I were wondering what the pop quiz was going to be (inaudible).

RAF EPSTEIN:

Look I’ll give people a few examples. I don’t know if the detail was important or not. Everyone’s heard Julie Bishop’s lack of ability to understand the change to the Transition to Retirement scheme. I’ll throw a few more into the mix, you tell me if these matter or not. Alan Tudge was sitting in the chair Scott Ryan was sitting in, I asked him about the unemployment forecasts in Scott Morrison’s latest budget.

[Excerpt]

RAF EPSTEIN:

That’s Alan Tudge. Also yesterday, Steve Ciobo, the Trade Minister, we had a little dispute as to whether tax is going up as s proportion of the economy. I said it was, he said it wasn’t, he was gentlemen enough to come back after his segment was over to concede he wasn’t quite sure. I won’t play it, but I’ll ask you gentlemen, Tim Watts – David Feeney, Julie Bishop, in fact I would say Kelly O’Dwyer, like Alan Tudge, didn’t know the unemployment rate forecast in the Budget. Does any of it matter?

TIM WATTS:

Look I think context matters Raf. You can understand a backbencher coming to a very complex area of policy like superannuation and struggling, but Julie Bishop was in the cabinet room as that policy was being developed, and not being able to articulate it when she knew it was an issue of quite some contention, when she’s got her colleagues objecting to it, when she’s got traditional Liberal Party supporters like the IPA, like Judith Sloan, like Peta Credlin all objecting to it, to even then not know the detail is quite extraordinary and it represents something.

RAF EPSTEIN:

I might expect you to say that about Julie Bishop, but if David Feeney doesn’t know, I mean he’s a significant part of the team, now I don’t want to argue the politics of when and how you dropped the Schoolkids Bonus, but it’s an expensive measure, it’s something you campaigned to keep for a long time. To not even know what’s happening with it, that’s a problem by the yard-stick you’re measuring Julie Bishop with, no?

TIM WATTS:

Well it’s an issue that has evolved over the course of the campaign, we’ve been really clear to say that we’ll outline our full budget situation closer to the election date, and David was responding in that context. We’ve heard since the election started that the Government has tripled the deficit and that requires an additional focus on priorities. Our priorities are schools, hospitals (inaudible) –

RAF EPSTEIN:

They’re all arguments without policies. So is your answer really, it depends on the weight of the policy, the significance of the policy in the party’s platform?

TIM WATTS:

I think the context does matter. Does it reveal something? And as I say in the Julie Bishop scenario, it reveals the chaos and lack of consultation surrounding their superannuation policy.

RAF EPSTEIN:

Scott, do you agree?

SCOTT RYAN:

I’m not a particularly religious person, Raf, but something comes to mind: judge not lest ye be judged.

You know Tim did a good job of getting out all the Labor talking points there, but look, we all occasionally are not going to be able to recall something off the top of our head. I appreciate that Labor’s been trying to make political hay out of this, but Julie Bishop is our Foreign Minister, she’s the Deputy Leader of the Liberal Party. Do I expect her to know everything about every policy? No I don’t. Do I expect her to know everything about my portfolio? I do not.

RAF EPSTEIN:

I’ll give you more chance to talk, but is there weight to the argument that listen, it’s probably the biggest issue amongst people who voted Coalition last time and or during previous elections –

SCOTT RYAN:

(interrupts) I wouldn’t agree with that.

RAF EPSTEIN:

No? It’s not the biggest burning issue in you base?

SCOTT RYAN:

No, I wouldn’t say that at all.

RAF EPSTEIN:

Because there are senior Liberal people saying they fear it’s a vote changer.

SCOTT RYAN:

People might say that. I think there are people concerned about it and asking questions, I’m not trying to deny that, but I don’t think it’s by any means the biggest issue. Among people who voted Liberal last time and are thinking about voting – or hopefully – voting Liberal, or for the Coalition this time. I imagine if Julie had her time again she would have hoped to be able to answer the question, but I think we’ve got to be realistic here, she is the Foreign Minister, and not being able to answer one particular question on a detailed aspect of superannuation policy in this case the Transition to Retirement Pension Scheme, really? I don’t think it’s a vote changer, I think we’ve got to be realistic about what we expect about my colleagues. And if it was Kelly, or if it was Scott I think that’s a different issue, but they clearly know how to answer all the questions about superannuation.

RAF EPSTEIN:

I’ve asked you to tell me if you think it’s important that they’re across every detail. Kate is in Mount Eliza, what do you think?

CALLER:

Hi Raf, look perhaps not every single detail, but I think it’s really important for the people to be across a lot of policies. They’re effectively the sales people for the party. Julie Bishop is one of the, you know, senior members of the Party. I found that you know, really wrong that she wasn’t across those aspects, so yeah.

RAF EPSTEIN:

Okay thank you. Now Bob’s in Tecoma. Bob what do you think?

CALLER:

Look, I think if Julie Bishop was sitting in the cabinet when all of this was discussed, what was she doing? Sitting there looking out the window with her eyes glazing over? She was sitting in the cabinet as a senior member when an absolutely critical change was being discussed, and she clearly had no idea what was going on.

RAF EPSTEIN:

Are you concerned about say, Labor politicians not knowing the detail of their policies? Or is it a Coalition issue because that is the burner one?

CALLER:

I think that generally the policies are too complex. The superannuation one – last year I fell foul of the policy that Julie Bishop – that tripped her up, for falling foul of it for just a genuine misunderstanding, I copped a $400 fine from the tax department and double taxation on superannuation contributions.

RAF EPSTEIN:

Okay so it’s a painful issue for you. Thank you, I’ll get to more of your calls. 1300 222 774.

Let me put this as a proposition to both of you, because I am genuinely concerned about the state of political debate. I know that people get very upset and I want people to be optimistic and be engaged. I’m a fan of the detail because I think it’s a good way to test a political party. I would say to the ALP’ listen, you haven’t comprehensively modelled the negative gearing change, and a lot of the economic verdict on it is not that it’s not a good idea, but that it won’t have a substantial impact on house prices’, that’s my argument.

The same with the Government, I would say ‘you’ve got a plan for jobs but your own documents like the Budget and the modelling done on the corporate tax cut, they don’t show pronounced benefits’. So detail’s clearly important. So I’ll give you both another chance if, most people won’t be across, Tim Watts, say the modelling, but isn’t it fair enough if you’re asked the detail around how do you know what impact it will have, where’s the evidence? I guess the question is to boil it down, it’s fair enough to ask a politician, is it something you stand for? Or is it something you’ve actually got proof will work? Is detail a good way of getting at the difference between a value and a detailed plan?

TIM WATTS:

I hear what you’re saying Raf, but what I’d say to you is that politics isn’t an exam. It’s not something that someone’s running over with a pen at the end of it. It’s a contest of ideas and of values, so if not understanding the detail shows that you haven’t thought through the values, you haven’t thought through the way something operates, then yes. All right so the Liberal’s candidate for McEwen, crashing Bill Shorten’s press conference without knowing the way that the health policy that he was attacking works, I think that is fairly damning. Now not understanding, not knowing some of the specific figures associated with that policy, maybe we’ll give a leave pass for that. So again I think the context really does matter here. Is it something that reveals a flaw at the core of the argument? Or is it something that is a complex detail?

RAF EPSTEIN:

Scott I’d give you the specific example, just to expand on it a bit – there’s modelling done by Treasury on the corporate tax cut plan. It doesn’t show an overwhelmingly fantastic benefit, because of the corporate tax cut, you know we can start quoting numbers to each other. Should that be part of the discussion?

SCOTT RYAN:

I think the important thing here and this is a good example to draw upon, is that the modelling shows a one percent lift to GDP.

RAF EPSTEIN:

Over a decade, isn’t it?

SCOTT RYAN:

Now if we go back to the economic debates of the 80s and the 90s, whether it’s Hawke and Keating or Howard and Costello, Paul Keating used to sweat over a one percent change to GDP. That is, for a policy change, on its own, that is of significant economic value. So I think whether or not someone can answer a particular number off the top of their head, as opposed to explain how something works – and in this case, we know that you increase taxes on investment, you get less of it. It’s a basic economic principle you learn whether you study it at school or university and it’s empirically proven.

RAF EPSTEIN:

Taxing cigarettes is different to lifting tax on company tax isn’t it?

SCOTT RYAN:

No, Ken Henry pointed this out in the tax review that Wayne Swan commissioned. Chris Bowen, the shadow treasurer, pointed this out when he wrote articles arguing for a reduction in company tax. So you know this is something that’s established in principle, and empirically, and we have adopted it. And the Treasury modelling points out a lift in one percent GDP which as I said, Paul Keating used to say you take these things when you can get them because it’s an easy win to give you economic growth.

RAF EPSTEIN:

Can I just get a quick response, seeing as we’re talking about the detail, let’s make that the core of the policy. Tim Watts, a point one percent improvement to GDP each year for a decade, worth sweating over, according to Scott Ryan and Scott Morrison.

TIM WATTS:

Of course it’s worth sweating over, but you unpack the assumptions that lead you to that figure and you have a whole cascade of further debates over detail, over how you model something to get to that outcome. What we would say is ‘okay, let’s take Hawke and Keating as an example’. During the course of the Hawke-Keating government, they shifted high school completion from around three in 10, to around eight in 10, moving to nine in 10. That had a vastly higher impact on productivity in our economy, on economic growth than anything to do with company tax cuts. That’s what Labor’s trying to do here. We – it’s a contest of values, of priorities. Our priority isn’t a $50 billion dollar tax cut for large corporations –

RAF EPSTEIN:

You want to spend more on education.

TIM WATTS:

It is investing in the productivity in our workforce, over time through our schools policy.

RAF EPSTEIN:

Chris is in Heatherton. Chris, what did you want to say?

CALLER:

Yeah I just wondered if I could get a comment off each of your guests there about the disruptive Senate, and not many of the promises have given or will give in the next few weeks will actually get through the Senate anyway, and what the solution to that might be? I’ll hang up so I can hear your response.

RAF EPSTEIN:

Okay Chris, thank you. Well the polls, well I don’t know what they’re going to say about the lower house. It’s likely given the lower barrier to entry, double dissolution election means there are 12 senators up for grabs in each state or territory, not six. Lower barrier for entry, he’s kind of right isn’t he Scott Ryan? You’re almost certainly going to face a disruptive Senate?

SCOTT RYAN:

Well I think it’s fair to say I don’t expect either side winning government, including ourselves if we’re re-elected, to win a majority in the Senate. So you negotiate with the Senate. As a general principle, I’ve always had the view, personally and I am a senator, that I’ve argued the case to respect mandates.

RAF EPSTEIN:

Tricky though, isn’t it? Respecting mandates.

SCOTT RYAN:

Well it is tricky because for example, 2007, we had discussions and debates over what the respective mandate was and governments, as Julia Gillard showed, broke promises about no carbon tax, which happened due to a deal with Bob Brown, so it is tricky. But I’ve always had the view that you should respect the core element of the mandate, and I might say that has been one of the challenges that, remember, in this last three years, we’ve tried to implement some of Labor’s policies and they’ve voted against it.

RAF EPSTEIN:

So can I nail you down, what’s the core of your mandate? Is the company tax cut the number one thing that the Senate should not block if you win?

SCOTT RYAN:

In my view, it is clearly core to the election, it is clearly at the core of the government’s request for a mandate from the Australian people, and I think it would be quite frankly a rejection of the mandate –

RAF EPSTEIN:

(interrupts) So maybe Medicare, education are the things you’d compromise on, but not the company tax cut, if you had to?

SCOTT RYAN:

Well the thing is, I don’t see necessarily how they link, because for example –

RAF EPSTEIN:

No I’m just saying if you want to respect a mandate, and Tim will get the same chance to declare his number one issue, we’re likely to have a Senate that isn’t controlled by Labor or Liberal party, so you’re willing to compromise on something that isn’t company tax.

SCOTT RYAN:

Well I remember in 1993 when Paul Keating said to John Hewson and the Australian people, ‘don’t expect the Labor party to block the GST, if you vote for this guy you’re going to get it’. And so while I think there is an important role for the Senate in checking the executive, and an important role for the Senate in examining legislation, when you look at what Labor’s done on things like the Australian Building and Construction Commission, which has been a core part of our seeking of a mandate since 2004, Labor has constantly rejected it, so that’s inappropriate.

RAF EPSTEIN:

The core of the mandate I think is growing. I’ll give Tim Watts a chance to nominate his core issues should Labor win. We’ll get traffic first with Chris Miller.

[traffic report]

RAF EPSTEIN:

Scott Ryan and Tim Watts are with me. I will give Tim Watts a chance but I want to go to Harvey who’s in the city. Harvey, what did you want to say?

CALLER:

Thanks Raf. I’m a tax accountant Raf and I’d like to make a comment about the superannuation announcement. (inaudible) were contained in about two A4 pages of the budget paper, and the Government immediately went into caretaker mode. So in defence of the Foreign Minister I would say that there’s a lack of detail, and I know that through my discussions with my professional bodies and what the ATO has done is set up a hot line which offer the proposals and far more details than our political leaders are talking about –

RAF EPSTEIN:

We should get the ATO hotline on the radio.

CALLER:

Yeah, and also too, what we’ve got to remember is that the law is what it is and the law is what it is now, and the proposals are just proposals at that.

RAF EPSTEIN:

Okay so do you have a question for Scott Ryan, or just a complaint about the lack of detail?

CALLER:

I think unfortunately with these proposals what you’d normally see is the Government introducing them at a time when there would be consultations and discussions after, and of course at the moment nobody’s prepared to talk about the broader details because we’re in this caretaker mode prior to the election.

RAF EPSTEIN:

Look you raise some interesting points. I want to ask Tim, but Scott a quick response.

SCOTT RYAN:

Well I think to be fair they were announced in the Budget as Budget measures –

RAF EPSTEIN:

Is it two A4 pages? I don’t know.

SCOTT RYAN:

Off the top of my head, I don’t know. But I think it’s also fair to say that normally tax measures are announced as policy and there’s consultation around the implementation of them and I think that has been made clear that will happen as normal. But as opposed to sort of floating ideas and then actually saying what we’re going to do, the Government took an approach that this needed to be addressed and rebalance the super scheme to support people at the lower-end of the superannuation incomes and make it sustainable. But I take the point around the timing.

RAF EPSTEIN:

Tim, a quick response.

TIM WATTS:

Well this goes to the core of the problem with Julie Bishop’s interview, in that it represents the flaw in the Government’s policy-making process on superannuation. They’ve released this policy at five minutes to midnight, immediately before an election, and now they’re seeking a mandate for what is likely to be a moving target – something that is being objected to by the Government’s own people and the Government’s own supporters. It seems like it’s going to change. Labor, we released our superannuation policy more than 12 months ago –

RAF EPSTEIN:

But you did scrabble, I mean in the tit for tat of politics, you scrabbled to clarify what you were doing with the Schoolkids Bonus and other things and you only did that, you were forced into that announcement because Scott Morrison and Mathias Cormann stood up and said ‘look here’s the list of all the things Labor can’t pay for’.

TIM WATTS:

I mean these are very different issues. We’ve been very clear that we’re going to release our budget position before the election and the Schoolkids Bonus is a far simpler policy question–

RAF EPSTEIN:

You’re accusing the government of messy process – that was a messy process on your side wasn’t it?

TIM WATTS:

Superannuation – the process matters in superannuation because it’s people’s confidence in their retirement schemes –

SCOTT RYAN:

You changed it so often in Government we lost count.

RAF EPSTEIN:

Can I, Tim, in the moments we have left, Scott’s nominating, I’m sure the list would grow if I kept asking, but company tax is the number one thing, the mandate that should be respected. What is it for Labor? What’s the number one thing the Senate should respect if Bill Shorten becomes Prime Minister?

TIM WATTS:

The number one thing that I talk about more than any other is our schools funding policy and that’s something that we are funding through the measures that we have announced with significant lead time, on superannuation tax concessions, capital gains tax and negative gearing reform. So that’s the real mandate that we’re taking to the people.

RAF EPSTEIN:

You confident of winning?

TIM WATTS:

I think we’re making a very strong case to the Australian public, and I couldn’t be prouder to be a part of Bill Shorten’s team. I think this is an election campaign that every Labor supporter can be proud of –

RAF EPSTEIN:

I just get the feeling that Labor’s not as confident this week as they were last week.

TIM WATTS:

I think the wind is at our sails.

RAF EPSTEIN:

Yeah? Scott, what do you think?

SCOTT RYAN:

I’m a bit of a renowned pessimist, Raf (laughs).

RAF EPSTEIN:

(laughs) So you just expect to lose, is that so you can handle your own expectations?

SCOTT RYAN:

No, no, I – you know I worked down here briefly on the 1999 state election, you know, I think anyone that actually takes any election for granted no matter what seat, is a bit of a mug. This is an election that can be won by either side, so every vote matters.

RAF EPSTEIN:

So it still is either side’s to win?

SCOTT RYAN:

I firmly believe that’s the case.

TIM WATTS:

We agree on something.

RAF EPSTEIN:

Alastair’s in Ivanhoe. Make it quick if you can, Alastair.

CALLER:

Yeah very quickly, to the Labor guy: your party was the party that left us with $300 billion worth of debt. We’ve got a treasurer-in-waiting in the form of Chris Bowen who doesn’t even know what tax scales are when he was questioned by Alan Jones. To the person in the Liberal Party: your party is the party which basically imploded the car industry, and now you want to fiddle with our retirements. What are your solutions?

RAF EPSTEIN:

Oh you’re not happy with either, Alastair. Gentlemen, you’ve got 10 seconds each. Tim Watts?

TIM WATTS:

We’re the party that saved Australia from the global financial crisis: 200,000 jobs protected; they’re the party that tripled the deficit after they got in whinging about debt.

SCOTT RYAN:

Labor blew up the savings account that Howard and Costello had built up. They made Australia uncompetitive and we’ve been trying to clean up the mess and we need more time to continue to do so.

RAF EPSTEIN:

Boom, they both got it in under 10 seconds. Tim Watts, Scott Ryan, thank you so much.

SCOTT RYAN:

Thank you.

TIM WATTS:

Pleasure.

RAF EPSTEIN:

Didn’t quiz them about a single detail.

(ENDS)