25 June 2014



SUBJECT/S: Tony Abbott’s unfair Budget, RET, Industrial Relations, Independent National Security Legislation Monitor

CHRIS HAMMER: We’re joined in the studio by Michelle Rowland, Labor Member for Greenway in Sydney’s West and Senator Scott Ryan, Victorian Senator for the Liberal Party. Senator Ryan to you first, there’s something like a hole of $25 billion to $40 billion in the budget, the budget’s target of returning to balance in about four years is pretty much out the window, isn’t it?

SENATOR SCOTT RYAN, SENATOR FOR VICTORIA: Well let’s put this in context, we’ve inherited an unsustainable budget situation with debt continuing to grow at a rate that would place an incredible burden on future Australians. We brought down our budget in May, the Senate is now only in their second sitting week after the budget, we’ve got a sitting fortnight to come in July, and as the Prime Minister and Treasurer have made clear we intend to negotiate and sit down with the cross benchers and negotiate the budget measures that were announced through because they are important to bring the budget back into balance. The debt trajectory under Labor’s plans is utterly unsustainable.

HAMMER: But with something like 60% of Australian people thinking the budget is unfair, what incentive is there for a cross-bench Senator to support the budget?

RYAN: Well we’re making appeals in the national interest, we are making an appeal to the sense that all politicians – that the Labor Party used to have as well – that there is a national interest in not placing an unsustainable debt burden on the future Australians. Now this is only an issue firstly because of the mess that Labor left us in and secondly because they are refusing to clean up that mess and most ironically of all, we’re trying to legislate for $5 billion of Labor’s budget savings that they announced in the budget last year and Labor’s voting against their own measures.

HAMMER: Michelle Rowland, isn’t Labor in danger of overkill here opposing measures, Scott Ryan has said that you supported the election, aren’t you doing exactly what you accused Tony Abbott of doing, and that’s being oppositionist for opposition’s sake.

MICHELLE ROWLAND, SHADOW MINISTER FOR CITIZENSHIP AND MULTICULTURALISM; SHADOW ASSISTANT MINISTER FOR COMMUNICATIONS: I think the first thing to note Chris is that Labor made it very clear when this budget was brought down some six weeks ago that we would examine it for fairness, we would prioritise areas and we would also seek to cooperate in other areas. I think that the announcement that Bill Shorten made yesterday about those aspects of the budget we would support point to a very well thought out and a very methodical way, and with a great focus on fairness I might also add, in seeking to do what is in the national interest. We believe primarily that this is about fairness, and last night there were measures that Labor put forward, sensible amendments.

HAMMER: Why not support, say the re-introduction of indexation on fuel tax? An indexation measure that was originally implemented by Labor in Government.

ROWLAND: Well certainly, look it was actually taken away under the Howard Government, we didn’t go to the election saying we were going to bring it back and by the way neither did Tony Abbott. So I think that’s one of the tests for budget measures, is not only is fairness a great part of it, but also what was promised before elections, we want to hold this Government to account over its promises. If I can just finish, last night we proposed some, and are prepared to support some very sensible – we thought – savings, and it’s very important to recognise we supported responsible savings that we thought were also fair. Like lowering the time of which students can go overseas and still receive payments, taking into account untaxed superannuation benefits for qualification for the Commonwealth Health Care Card. But there are some aspects that we won’t support, we won’t support the reintroduction of a GP Co-payment, we won’t support certain cuts to family tax benefit. So I think that you need to bear in mind that Labor has examined this, it is not a blanket area of opposition, it is very well thought out and we have assessed these things on factors such as fairness and promises made before the election.

HAMMER: Well Scott Ryan accept that Labor’s going through this policy by policy, or do you see this as a blanket political strategy.

RYAN: Well, I’m not going to be told that Labor’s trying to keep people to their word about what we promised before the election. We promised to get rid of the Carbon Tax, that’s $500 for every household that means a lot more, by the way, for lower income earners who spend a higher proportion of their income on electricity and gas. Labor’s stopping us from doing that, and under Labor’s plan …

HAMMER: But it’s not …

RYAN: Under Labor’s plan those taxes continue to increase, so Labor is supporting tax increases instead of trying to get rid of them.

HAMMER: But it’s not so financially responsible to cut the income from the Carbon Tax but to keep paying out the compensation. That puts a hole in the budget in itself, doesn’t it?

RYAN: But we costed that plan, and we had known how we were going to pay for that before the election. We were very clear about that. That’s a promise we have made for years and that’s a promise that Labor is stopping us, Labor is stopping us from delivering on that commitment to the people and quite frankly, they lie about saying that they will terminate the Carbon Tax but vote against it every time it comes before Parliament.

HAMMER: Okay, now you’ve mentioned Carbon and the Renewable Energy Target, there’s new research out showing that keeping the Renewable Energy Target would lead to falls in electricity prices, so why not keep it?

RYAN: Well I understand, I’ve seen some of the newspaper commentary on preliminary research that I understand was commissioned by the review. That’s why we have a review, to look at the impact of the Renewable Energy Target, to look at the impact of the changing profile of the demand for electricity, what was originally set at a 20% target now looks like being much more closely aligned to a 30% target, and this review is looking at what are the cost impacts of that target, how does it work? Now there is competing research, there is other research that says that the Renewable Energy Target drives up prices and a lot of that research, I note the research that was reported in today’s paper says the opposite. But it does pose the questions that if it does drive down prices, why does it need a compulsory subsidy taken from the bill of every electricity user.

HAMMER: So the assumption is that the Government will get rid of the Renewable Energy Target, are you saying that if the Review actually shows that it is a positive thing that it will be kept.

RYAN: What I am saying is that the Government has said that we will have a review and that we will go into the review with an open mind because the target of 20% that was originally set by Labor looks like being much higher than that, near 30% and there is a great amount of anecdotal and research evidence that explains that there is a significant cost burden that this imposes on electricity uses and particularly on energy intensive employers. In my home state of Victoria that has a high base of manufacturing, I hear a lot of concern. I heard some only earlier this week about the cost of the Renewable Energy Target on their electricity bills. Now we should understand what those cost impacts are and then go ahead and make a decision.

HAMMER: Okay, Michelle Rowland, do you believe that the Government does have an open mind on the Renewable Energy Target?

ROWLAND: It’s strange though Chris because for some time we’ve had some Government members coming out, and I think the Prime Minister even alluding to it, saying almost without question that the RET drives up prices. This ACIL study that has come out, a reputable firm, clearly shows that whilst there are some price increases in the first years there are noticeable reductions in electricity prices from then on. So it does beg the question of if we support evidence-based policy making in Australia, surely this demonstrates that renewable energy actually results, in the long term, in lower prices for consumers. And I believe that when we talk about networked industries, when we talk about essential services such as this, we should be basing this on solid evidence and we should be basing this on the long term interests of energy users.

HAMMER: Okay now there’s another report in the paper today, Scott Ryan to you, that the Government’s review of workplace relations has been put on hold, because it’s a politically difficult area for the Government, going back to the Work Choices in the Howard Government, that essentially you don’t want to be fighting on two fronts here, you want to concentrate on the budget. Is this report accurate, do you believe?

RYAN: Um, I don’t think so. We made a commitment before the election to have a productivity commission review and this is a commitment we stand by. We will undertake that this term and as we’ve said we will have a look at the findings of that review before we take any commitment to policy to the people at the next election.

HAMMER: Michelle Rowland is it a good time to have such a review from Labor’s point of view? Given that it would be a pretty brave Government to be planning any dramatic work place changes at the moment.

ROWLAND: Well that’s a matter for the Government to decide when it wants to conduct this as part of its business of being in Government. But I’ll point out a couple of things; firstly I note that the terms of reference that have been proposed include matters such as employment, the impact of the Fair Work Act on employment. Well I can tell you now that I don’t need a commission to tell me about unemployment and the measures that we need to put in place to make young people more employable. And unfortunately coming from an area of Western Sydney which has very high levels of youth unemployment in some parts. Measures that went to the employability of young people, many of those measures which have been scrapped in this budget are going to have a long term impact on the employability of those young people. I think things like productivity, that are going to be examined as well, we already know, every study will show you the best way to drive productivity in an economy is by investing in ICT. And again in this budget so much money has been cut from innovation and those very things that would have driven these areas. So I don’t need an inquiry to tell me about some of those parts. But you know that’s a matter for the Government to bring forward, and I’m very prepared to have the debate about it whenever they bring it on.

HAMMER: Alright, how do you think the economy as a whole is travelling, quite separate from the budget, because I mean there has been some indications that it’s been hard to measure business confidence after consumer confidence seems to have taken a hit from the budget.

RYAN: Well the experience I had in my previous portfolio of Small Business over the previous three years was that small businesses took a confidence hit in the unpredictability of the previous Labor-Greens Government, over broken promises of the Carbon Tax and that takes some time to work through.

HAMMER: Well we’re in an area of unpredictability now aren’t we?

RYAN: Well, well we’re not being unpredictable, you know we are trying to deliver on the commitments we took to the people, particularly around the reduction of those in-costs on small business of the Carbon Tax and Labor is stopping us from doing that. You know, so the economy as the Treasurer made clear after the election, Labor spend years re-regulating the economy, tying it down, dramatically increasing public spending, dramatically increasing deficits and that’s a very different economy that we’ve inherited upon taking office, from the one in which John Howard and Peter Costello inherited. We had our differences with Paul Keating over budget deficits and some of the issues like Working Nation, but we always gave credit to the Hawke and Keating Governments for deregulating the economy, for undertaking the start of microeconomic reform. The previous Labor Government went backwards, it took us back beyond the Hawke/Keating agenda and so we’ve got a harder handicap to start off with.

HAMMER: Michelle Rowland?

ROWLAND: Well when I go around my electorate and speak to small businesses, they’re not jumping up for joy because ‘red tape’ has been removed, they’re not jumping for joy because they think all of a sudden 9 months into this Government’s term that suddenly their business has improved or consumer confidence has increased. So look, I think that when you talk about the local level of the economy, there really are some areas that are quite obviously flat when you go around Western Sydney, people are still very concerned, and look families are concerned. On average some of these families are going to be $6,000 worse off if these budget measures go through. So when I speak to parents they are actually looking long term at taking their children out of private schools and making some very difficult choices there. This is a time of high unpredictability and I think that that is being reflected in consumer confidence and business confidence being quite low at the moment.

HAMMER: Okay, a final issue is that Tony Abbott is reported of telling the Coalition party room yesterday that the Coalition has stopped the boats, has stopped the jihadists – a reference made to the 150 Australians fighting in Iraq and Syria with ISIL. But Scott Ryan it’s not actually possible to stop most of those people coming back to Australia is it, if they are citizens of Australia?

RYAN: What the Prime Minister has made clear publically is that we will all the tools at our disposal to stop the people bringing the jihadist terror approach back to our country. Some of those people who are dual citizens, we have different options in that case than we do for those people who may be solely Australian citizens. But we also have domestic laws we can use to ensure that people promoting violence, and people promoting terror, and jihad can’t do that in Australia. I mean it is of course illegal to go and fight in a foreign war and the Prime Minister has also made clear that if we need new resources, we will actually seek to get those. Um but the key point is that our priority is the maintenance of the security of the Australian community and that is what first and foremost will drive every action we will undertake in this regard.

HAMMER: Michelle Rowland, you are Shadow Minister for Citizenship; surely this is an issue where you want bipartisanship with the Government.

ROWLAND: Well it has to be, this is about the national interest, this is about national security. I’ll point out that as Bret Walker, the independent security legislation monitor, the independent monitor of these coercive powers pointed out, these coercive laws, these counter-terrorism laws are not a passing fad, they are here to stay. They are here to stay in every country unfortunately, including Australia. And we do need to in some cases strengthen those laws because, as Bret Walker again pointed out, he is very much alive to this unfortunate issue of the ‘travelling jihadists’ who go around and seek to fight in foreign wars. Unfortunately some of whom are Australians and we need to make sure that Australia has every power possible for that, but we also need to make sure that there is very effective independent oversight. Not only to safeguard citizens’ interests, but also to make sure that those laws operate as effectively as possible and protect Australians as effectively as they can. Which is why this is exactly the wrong time to be scrapping this independent role and saying that it is somehow some form of red tape, which is what this Government has done by introducing a bill to appeal this section. It’s not red tape and there is no duplication in this area.

RYAN: Michelle you’ve moved away from the first part where you have said that you want bi-partisan support in this, if that was the case then Labor shouldn’t have stripped hundreds of millions of dollars from customs and border security like you did during your years in office which we have had to put back in place.

ROWLAND: Look don’t start with me on ‘what you’ve done’ and ‘what you were seeking to do with these counter-terrorism laws’. These counter-terrorism laws need to be as effective as possible, this oversight is not red tape …

RYAN: … and they need the resources of agencies to do so …

ROWLAND: … this is exactly the wrong time, exactly the wrong time to be looking at disbanding this very important piece of independent oversight. Counter-terrorism laws are here to stay and we need the most effective mechanisms in place to make them work properly.

RYAN: And they need agencies with the resources to enforce them.

ROWLAND: What do you think the independent monitor’s role is?

RYAN: Well we’ve had to put resources back in that you took out of customs.

HAMMER: I think that maybe we should leave this for another day, we can have a whole debate on this issue because there sounds like there’s some differences there to explore. But Michelle Rowland, Senator Scott Ryan thank you for today.

ROWLAND: My pleasure.