SUBJECT/S: Andrew Chan and Myuran Sukumaran; GP Tax chaos; Labor’s multinational tax plan

E&OE TRANSCRIPT
ONLINE INTERVIEW

FAIRFAX ‘BREAKING POLITICS’
WEDNESDAY, 04 MARCH 2015

CHRIS HAMMER: We’re joined by Michelle Rowland the Labor member for Greenway in Sydney’s West and Angus Taylor, the Liberal member for Hume in New South Wales. Michelle Rowland time appears to be running out for Andrew Chan and Myuran Sukumaran, is there anything more the Government could do?

MICHELLE ROWLAND, S HADOW MINISTER FOR CITIZENSHIP AND MULTICULTURALISM; SHADOW ASSISTANT MINISTER FOR COMMUNICATIONS:  I believe that the Government and the Opposition and every Member of Parliament have been united in our opposition to the death penalty for these two young men. They are models of rehabilitation, I believe there is strong community sentiment that these executions should not go ahead. I actually have in my electorate the Sukumaran family church and we had a service there a couple of weeks ago that was overflowing and there is a very strong sense that this will be a bad result for the world if these two gentleman are put to death, and put to death in such a violent way. Especially considering the work they have been doing and the loss they will be to their community, which is, the inmates at the moment.

HAMMER: Angus Taylor what’s it say about the relationship between Australia and Indonesia that for all the efforts of the Prime Minister, the Foreign Minister, all the politicians in Australia, potentially the whole community, that it appears nothing has been able to sway the Indonesian President.

ANGUS TAYLOR, MEMBER FOR HUME: Well can I say out front Chris that this is very distressing for the families of Andrew and Myuran and that we are in complete agreement across the Parliament that we would like the Indonesian Authorities and the President to show mercy to two men who have been remarkable in the way they’ve transformed their own lives in the time they’ve been in prison. But you know friends have disagreements and we have a disagreement on this issue and it’s very clear that this has happened with the Indonesians and the Indonesian President, we would like them to show mercy and we will continue to make representations at the bar for these two men and their families.

HAMMER: Now moving on to domestic and budgetary issues. Angus Taylor the Prime Minister said the GP Co-Payment is “Dead, Buried and Cremated”. Do you believe there still needs to be some price in the GP/Medicare system to contain costs in the decades head?

TAYLOR: Chris, I think you need to take a step back here and say “what is problem we are trying to solve?” Now there are two problems. The first is that we know we need to deliver great health outcomes across Australia and we have more and more good technology and techniques that we can use to deliver better health outcomes across Australia. Secondly we have health budget that’s rising at close to 10% a year, close to 10% a year with Government income rising at 3% a year. That’s totally unsustainable, as we will see in the Intergenerational Report. It’s not about cuts, but it is about containing growth and expenditure and we need new ways to do it. Pricing is one way to do it, there’s lots of other things, innovations happening all around the world to do this, because we’re not the only country in the world facing this problem. The Health Minister is looking at a whole range of options to do this, but a price signal is not the only way to go about it and we’ve said its gone. Now we’re focusing on other ways to achieve this policy outcome.

HAMMER: So essentially, Medicare as we know it –bulk-billing and GP visits – is not sustainable?

TAYLOR: There is no question that our health expenditure is unsustainable if it keeps growing at the rate it is, it will swamp the economy. Use just straight maths, you will see it in the Intergenerational Report. So we have to do something, I don’t think this is even in debate by informed economists, what is in debate is how we go about it. That’s why there’s been this extensive consultation which the Minister is undertaking and will continue to undertake in the coming weeks.

HAMMER: Michelle Rowland, do you accept that? That it’s inevitable that the cost of healthcare is blowing out? An aging population, the increasing cost of pharmaceuticals, medical technology, etc and that the Government is right to address this issue.

ROWLAND: Chris there’s no doubt that we are living longer and that we are living better. There was a time, not that long ago, where if you needed a hip replacement you went home, became immobile and slowly died, you know that was the reality. We have had advances in technology, but I believe there are two issues when we talk about sustainability which Angus mentioned. Firstly, benchmarked against the world, Medicare is clearly one of the most efficient and sustainable health systems possible, clearly and it is clear that while we may be getting older, living longer and have better technology, Medicare has been able to remain sustainable.

HAMMER: That’s now and in the past, what about in the future?

ROWLAND: I’ll come to that. But the more pertinent point I think is that the way this Government has gone about addressing sustainability has been exactly the wrong end of the telescope. Any health professional will tell you, that you won’t make a system more sustainable by attacking primary healthcare. A number of years ago in a past life I was a director of the Western Sydney Area Health Service and I learnt a bit about health economics there. Now the one thing I learnt that has stuck with me, and I don’t know how much the figures have changed, but for every notional one dollar spent in health, about two cents is spent on prevention. The whole point of primary healthcare and making sure we have GPs who are able to do their jobs properly, are able to diagnose chronic health, are able to manage chronic health conditions. All these aspects are what have been attacked by the Medicare Co-Payment. We’ve even seen in some parts of Western Sydney people thinking that already their GP has put in a co-payment and are putting off going to the doctor. That’s not a price signal, that’s a bad health signal.

HAMMER: Okay, okay the Medicare Co-Payment is dead but Angus Taylor does Michelle Rowland have a point there in that primary healthcare and preventative health care, that is money well spent? Perhaps if we’re looking at cuts to healthcare it should be future down the medical track?

TAYLOR: There’s no question that primary health, which is not the same as preventative healthcare, is incredibly important to the entire health system. But there is nothing in the way Medicare works at the moment that actually gets to the solutions we need to. I’ll give you an example, chronic health problems are the biggest health problems we have in our system at the moment, you know diabetes, cardio-vascular disease and so on. The cost of those chronic health diseases are growing astronomically. Managed care programs which are designed to care for this are growing at 28% per year. It’s not a matter of saying you shouldn’t attack primary healthcare, there’s no question that primary healthcare has to become more effective in solving these problems. And that’s why the Minister is out talking to people, and I’m out talking to all of my GPs, and there’s lots of ideas coming in about how we can do it. But we have to deal with it, we can’t leave it the way it is.

HAMMER: So the Government has to work out a different way of payment for the people who occasionally go and see the doctor and for those of a chronic illness who are going to the doctor twice a month or whatever.

TAYLOR: There’s no question that chronic disease needs more focus and that primary care is an important part of that. Now there’s been work done over the years to try and get that going, which is why we’ve got managed care plans which are designed to solve these problems, but there is a lot more work that needs to be done and this will be an area of focus in the coming weeks and months.

HAMMER: Does this make sense to you Michelle Rowland, a different way of paying for chronic disease care as opposed to occasional care?

ROWLAND: Well I think the issue is the same. The issue comes down to are you going to penalise people for seeking treatment at the outset and going and getting diagnosed from the outset? What I don’t understand is the Government’s response to this. Firstly, they said they wanted a price signal, a value signal, whatever other signal it is today, and then they said they are going to start consulting with doctors now, in December they said they had new and improved solution. What it comes down to Chris is that this is the Prime Minister responding to polls, this is based on polls, not how we manage people’s care and how we manage to keep them out of the hospital system which is where most of the costs arise. It’s simply reactionary, and eighteen months in we actually don’t have a health policy from this Government and I know Angus can sit here and say “what are you doing about it?”. We’re not even in Government, and for the last eighteen months we have been talking to the health experts on these issues and it seems the Government has just discovered that.

TAYLOR: Look honestly, Labor didn’t solve any of these problems when they were in Government. I didn’t want to get partisan about this but it’s the truth. The other thing I will say is that if Labor doesn’t want to deal with this rising cost – and it’s not the only one, we’ve got it in aged-care we’ve got it in welfare – then the truth of the matter is that they’re going to have to raise taxes, and not just once but to keep doing it. So you know this is the choice, politics and economics is largely about choice and they need to fess up to the Australian people about what their choice is.

HAMMER: Okay well talking about tax, Labor has put a policy on the table as a way of stopping multinational companies from avoiding tax. The Treasurer has said that if it was implemented it would cost Australian jobs. Do you agree with that?

TAYLOR: Absolutely, this is the most extraordinary piece of policy yet, I know this area of policy well. You know this is using a sledge hammer to saw timber, it is flawed in its conception, it will be flawed in its execution – it will not work. A multinational that wants to get around this policy from Labor will do so in about two and a half minutes and it won’t work. But you know Labor is right to focus on this, we are focused on this, but we thing we have a solution to this that will work, not a solution that is concocted in academia.

HAMMER: So what’s your answer?

TAYLOR: Well we’ve already put the policy out, we need the ATO to be focussing on multi-nationals, we need them to recognise that there are many tools used by multinationals to take profit out of the country, it’s not just a matter of using debt – the one thing that Labor’s focused on – there are many tools they use and that’s just one of those.

HAMMER: You want the ATO to concentrate on this, so you think there is a bureaucratic solution as opposed to a legislative solution?

TAYLOR: We know the ATO, we know the ATO needs to have the ability and the resources to focus on this issue because – well Labor’s solution here is to say that there is only one problem, what multinationals do is put lots of debt into their companies here in Australia and take all of their profits out. Well let me tell you that is a small part of the problem, it is much deeper than that and it shows their naivety, their lack of understanding about commercial issues if that’s their solution.

HAMMER: Michelle Rowland, what’s your response to that and to indeed the Treasurer’s allegation that it would cost Australian jobs.

ROWLAND: Well firstly it’s interesting that Angus, when asked what their solution is, goes into fluff about what Joe Hockey is doing to address the issue. I mean he squibbed this at the G20, he squibbed it in the last Budget which had some forgone income in there as well. But I think it’s interesting to note that the Government has been saying “what’s your solution here?” This isn’t the solution for everything, this is a policy that has been devised in consultation with experts and also by speaking to executives. Now the whole point is creating a level playing field: it shouldn’t be fair that a multinational company which has some offshoot in a tax haven should get better treatment than an Australian company which does not. In the end if it is going to mean that we have some sort of revenue of over one billion dollars, I think nearly 2 billion dollars – which by the way almost equates exactly to the amount freezing the rebates which would otherwise accrue to GPs by 2018, I’ll just note that – if we’re going to have something which makes a difference in that area surely it’s something that will be embraced. If you’re going to claim that it’s something that will attack jobs, that it will affect jobs, then please by all means table the Treasury advice which says this. But Labor is very up for the debate, very up for the debate about why we need policies in this area, why we can’t just talk about “well we’ll let the ATO do it” and we can’t squib it like Joe Hockey has.

HAMMER: Now Angus Taylor, can we expect to see policy announced on this in the budget?

TAYLOR: So we have been talking about this for a long while – we have been working on the ATO with it – this is not new. And we recognise that this is a difficult problem that requires a broad solution, not a narrow one. And if you apply a narrow solution, it either doesn’t work or it has unintended solutions like loss of jobs. I can tell you this is an area that I know well. If you do, if you apply Labor’s solution it will either not work or it will have unintended consequences and Labor just doesn’t understand this area. They think there are ways of ripping money out of multinationals – you’ve got to be smarter than that.

HAMMER: If it won’t work how can it cost jobs?

TAYLOR: Well see either it won’t work or if it does it will have unintended consequences. Because it’s very narrow, it is only one way, one approach to tackling how multinationals might take profit out of the country. There are many other ways that they try to do it and they don’t seem to understand.

HAMMER: When will we expect to hear more from the Government?

TAYLOR: Well you’ve heard a fair bit already actually and you will hear more. This is actually an effort that will take some time and you’ll hear more about the results of that effort in the coming weeks and months. But we know that a simple solution like Labor has proposed will not work or if it does it will have bad consequences.

HAMMER: Okay Angus Taylor, Michelle Rowland thanks for your time today.

ENDS