E&OE…
KIERAN GILBERT
This is AM Agenda, with me now is Labor frontbencher Matt Thistlethwaite and Liberal frontbencher Scott Ryan.
Matt, first to you, your reaction to Scott Morrison’s argument there on a couple of different fronts, first the pension message where he is saying that you have to rein in the welfare, but when it comes to superannuation that is people’s nest eggs that you are talking about, and that Bill Shorten has got the balance wrong in his argument here.
MATT THISTLETHWAITE
Well Kieran, the first point is that we should never forget what Tony Abbott promised before the last election that there would be no changes to the pension and they have gone ahead and in several areas looked to reduce the rate of the pension over time by cutting the indexation rate, and now we have more leaks about more changes to the pensions. The Prime Minister has broken faith with seniors in our community. Look, with all of these issues they are leaks at the moment so we are waiting to see the details. But anything that makes it harder for pensioners to get by and is unfair will be opposed by Labor. We believe that there are other areas in the economy where savings and revenue can be increased and you need look no further than multinational profit shifting. Why would you target pensioners, Australians who have worked their whole life and paid taxes to the government, and we have seen in recent weeks big multinational companies shifting profits overseas and getting away with it, Labor has offered a policy that will crack down on this that will raise more revenue for the budget and doesn’t target those who have spent their life working and paying taxes in Australia.
GILBERT
Isn’t the Minister right in saying that this is winding back what was a generous treatment of the taper rate, as it is called? This is the part-pensioners, the individuals that have more and more wealth that the pension tapers off, this will remove the generous treatment put in place by Peter Costello and John Howard during the mining boom?
THISTLETHWAITE
Look, at this point in time it is still a leak and we haven’t seen the detail. We will give all of these announcements proper consideration through the due processes that the Labor Party undertakes in the party room. But at the end of the day Kieran, you are targeting some of the most vulnerable in our community and you are letting off many of those big businesses that have been shifting profits overseas and we see that as unfair.
GILBERT
Senator Ryan let’s go to you now. The starting point that I will go to you on is the message that Matt Thistlethwaite had at the top there, that Mr Abbott promised no change to the pension in the first term?
SCOTT RYAN
Scott Morrison outlined a few principles that inform this very important policy area. Firstly, we have to undertake budget repair; it is not sustainable to keep borrowing money at the rate that Labor left this budget in. Matt talked about getting Google or Apple to pay more tax, that is all very important but it is going to do nothing to plug the substantial deficit Labor left us with. What Scott also pointed out, and this is very important for the great number of Australians who have saved for their own retirement, is that we do need ensure that those who have saved, those who have put away their own money and deferred their own consumption in order to not be a burden on the welfare system, that we do not change the rules on those people halfway through their retirement. And thirdly, we do need to make sure the pension sustainable, it is growing at 5 or 6 per cent a year whereas Government revenue is growing at 2 percent a year.
(Interrupted)
GILBERT
I guess the question is just that, I want to put to both of you on this, why shouldn’t the Government look at both of these issues. Both the treatment of superannuation and look at the generosity of the tax treatment of super and also make the pension more affordable, more sustainable. Aren’t you both guilty here of isolating one area of reform without looking at the other?
RYAN
Scott Morrison there outlined the third principle, where you had generous pension arrangement put in place when you had a strong budgetary situation, and we clearly don’t have that now because of the mess Labor left us in, then maybe that is something to consider as part of the conversation. Particularly if you can change those tapering arrangements that only impact on people who have the resources that they can support themselves with. It is nothing but a myth to suggest that there is $30 billion in superannuation concessions that would be collected by the Australian Government if superannuation tax laws were changed, even the Treasury makes that clear in its tax expenditure statement. Paul Keating put in place the concessional contribution arrangements for superannuation and they have been there for a long time. There is no way the Government is going to collect tens of billions of dollar by suddenly jacking up the taxes on superannuation.
GILBERT
That is a fair point Matt Thistlethwaite, that people will simply, when they have money coming in, if the treatment changes so will their spending and savings pattern?
THISTLETHWAITE
Well Kieran, when you look at Australia at the moment, 80 percent of the nation’s tax concessions are held by about 15 per cent of the population, so there is an imbalance there in the way the system is operating. Labor has had a good look in consultation with tax experts on these issues and we have identified areas in the economy where additional revenue can be raised , that won’t harm growth, but importantly will protect the most vulnerable in our community and continue to provide that safety net, such as the pension. That includes cracking down on (interrupted)…
GILBERT
You say the most vulnerable, but we are not talking about the most vulnerable here we are talking about the wealthier part-pension that again, as I say was put in place by John Howard during the mining boom, it is not the most vulnerable that they are talking about, they (the most vulnerable) are going to be untouched.
THISTLETHWAITE
It is a question of fairness Kieran, and which areas in the economy the concessions are going to, and where the largest are and at this point in time they are largest for big companies who are shifting profits overseas and they are largest for people with very big and large superannuation balances that are earning high incomes off of those. They are areas in the economy where savings and additional revenue can be made.
GILBERT
Let’s finish with both of your reactions to the Federal Police media appearance yesterday, it was a lengthy response from the AFP Commissioner, he is very well thought of in both the Government and Opposition ranks, Commissioner Colvin. What did you make of his performance yesterday Scott Ryan, and has enough been done to prevent this sort of situation happening in the future, do you think more should be done or is this inevitable when people break the laws of other countries?
RYAN
Well I didn’t see the full press conference yesterday, I heard parts of it on the radio and read the reports of it this morning. You are right to say that the leaders of the AFP are very well regarded by the Coalition and I imagine also by the Labor Party. I think we saw just how difficult the job is for senior officers in the AFP making very, very difficult decisions. The point here is that the tragedy of capital punishment and the executions last week wasn’t brought about by the AFP; it was brought about by people breaking the law of another country, and tragically capital punishment being enforced. I think we need to respect the judgement of the AFP and I think most Australians have a very high degree of respect and trust in the judgement.
GILBERT
Matt Thistlethwaite, only thirty seconds left, just your thoughts on that?
THISTLETHWAITE
I think it was a good performance by the AFP, the media conference went for an hour, they explained the circumstances behind the decision and I think at the end of the day Kieran, you can’t blame the AFP for this issue, for following the guidelines that were in place at the time.
GILBERT
Gentlemen, I appreciate your time, we will chat to you soon.
(ENDS)