E&OE TRANSCRIPT
RADIO INTERVIEW
ABC BRISBANE DRIVE
MONDAY, 23 NOVEMBER 2020
 
SUBJECTS: Superannuation Guarantee; Wages; Robodebt; JobKeeper.
 
STEVE AUSTIN, HOST: Let's go to Labor's Jim Chalmers. He's the Shadow Treasury spokesperson. Jim Chalmers, good afternoon. 
 
JIM CHALMERS, SHADOW TREASURER: Good afternoon Steve.
 
AUSTIN: Have you read the report?
 
CHALMERS: I've been through it. There's 600-and-something pages, about 125 of those are technical appendices. I've been through it. I've read the important bits.
 
AUSTIN: Read the important bits, alright. According to the report the weight of evidence suggests an increase in the superannuation guarantee rate will result in lower wages growth, impacting standards of living. So does this mean the Federal Government can now legitimately say we're not going to do the planned increase in the superannuation guarantee next year?
 
CHALMERS: I think that's certainly what they want to do. They want to cut the legislated increases. There's legislation at the moment that says it goes up by half a percentage point five times, up from 9.5 per cent to 12 per cent. We've said, for some time, including for the four months that they've been sitting on this report before they released it, that our worry is that it's a bit of a stalking horse to cut people's super. Unfortunately when you listen to what the Government has said about it since it's been released, I think that's probably the case.
 
AUSTIN: Now that you've read the report, what's Labor's position on it?
 
CHALMERS: First of all, the report is much broader than this issue. I wouldn't mind saying that there are useful elements of the report. The report says that compulsory super is a very important part of the system; there are other useful facts and figures when it comes to the Aged Pension. I want to make it clear to your listeners that it's not like every word on every page is rubbish. I want to thank the reviewers, including someone who is known to me, Mike Callaghan, who led the report's efforts. The key conclusion that you introduced this conversation with, we think that they've got that wrong. What the Government claims and what others who want to cut super claim is that if you freeze superannuation, you'll get this much stronger wages growth and that the money that was going to go into super will go into wages instead. The problem with that argument is the last time that this Government froze superannuation, the six years since then have seen some of the lowest wages growth we've ever had on record. Compared to the six years before that super freeze, wages were growing 3.3 per cent before the super freeze, and 2.1 per cent after the super freeze. Take all the ideology out of it; take all the politics out of it; and just look for a moment at what actually happened after the last time this Liberal Government cut the superannuation guarantee. What happened was wages growth actually weakened rather than strengthened. We think we're within our rights to point that out. That's one of the reasons why we think that this argument is wrong, and why we support superannuation going to 12 per cent as it's legislated to do.
 
AUSTIN: You are within your rights to point it out, but this time it's different, isn't it, because of the pandemic which has occurred all year. Small and medium businesses will be the ones particularly who have to pay the increased rate to their employees, to the superannuation guarantee? You've also been asking, I think, for continued support for small business into the new year. Is it reasonable to do both? I mean, it seems that because the pandemic has changed the parameters, Jim Chalmers, that that money which businesses need to survive will now be compulsorily going to employee superannuation?
 
CHALMERS: We have demonstrated in many conversations I've had with you, Steve, and over the last 18 months or so in particular, that we are big supporters of small business. In many cases we've been front-running the Government when it comes to small business support. Where this argument falls over is the Government wants people to believe that the very same business that can't possibly afford a half a percentage point increase in the super guarantee, can afford to pay strong wage increases. They can't have it both ways. They can't make that argument simultaneously - 
 
AUSTIN: It seems to me, Jim Chalmers, that the question isn't answered yet. We won't actually know the answer to that until March/April next year when we'll see how many zombie companies are being artificially sustained?
 
CHALMERS: Nobody's disputing that there's lots of uncertainty in the economy. Times are difficult for many businesses and we will see businesses fall over, particularly when some of the Government's support is withdrawn, in my view, prematurely. Nobody is quibbling with that. The issue is this: the main reason the Government says that they want to cut superannuation is because they say that that will lead to stronger wage outcomes. We're pointing out that last time when they made the exact same claim, when they froze superannuation six years ago, we got instead some of the lowest wages growth on record. During that period, and this is what really bells the cat - and I think, ends the argument in this regard at least - is that the Finance Minister at the time admitted on TV that weak wages growth was a “deliberate design feature” of their economic policy. We have here a policy that they won't tell us about yet to cut people's super, but there's nowhere near any kind of policy to boost people's wages. It's wages growth that has been a problem in the economy, even before COVID-19.
 
AUSTIN: They just saved 700,000 jobs. I've just been reading the RBA's report on how JobKeeper did that today. They say at a national level, JobKeeper prevented at least 700,000 additional employment relationships being lost in the short term, quote unquote. I mean they just saved 700,000 jobs. Because of COVID-19 the parameters of everything, the traditional market behaviours and consumer behaviours, Jim Chalmers, have changed. Small business relies on consumer behaviour, and it's very difficult now for small businesses as I understand it. They're really looking to that March/April time next year saying, I'm not sure if I'm going to survive.
 
CHALMERS: Two things about that. First of all, we celebrate the 700,000 jobs that were saved by JobKeeper if that number turns out to be right - 
 
AUSTIN: That's the RBA's figure, it's not the Federal Government's figure. It's the RBA's figure - 
 
CHALMERS: Correct, and I read that earlier on as well. We probably had the same lunchtime reading by the sounds of it, as you picked through a salad and I picked through something less healthy - 
 
AUSTIN: A tuna sandwich in my case.
 
CHALMERS: you’ve stopped putting those photos up! Anyway, we celebrate that Steve. That is precisely the reason we proposed those wage subsidies, and why we didn't rub the Government's nose in it when they came around to our view, having initially resisted it. That's a good thing. We want those hundreds of thousands of jobs saved. We wanted more saved, and we were disappointed that more weren't saved. On the issue of small business, yes, as I've already said, things are difficult for small business but we are talking about a very important legislated increase to the superannuation guarantee. It's pretty modest but will make a big difference to people's retirement, take pressure off the Aged Pension, and frankly this is not about the report's authors and certainly not about small business people’s motives; it's about the Government's motives. They've been trying to come after super for the full seven-plus years of this Government and they're now using this pandemic as an excuse to do so.
 
AUSTIN: Alright, you've made that point but the Government doesn't pay it; employers pay it. Let me give you a message from someone who's listening: "It's very likely, we've already discussed how we'll handle it at my workplace. Our intention is to offset the super increase against what we forecasted for remuneration reviews next year. There's only a limited budget. If budgeting 2 per cent for wage increases, 1.5 per cent will go to wages and 0.5 to the superannuation increase." Employers have to pay this. The Federal Government doesn't pay this. It's employers that pay it, Jim Chalmers.
 
CHALMERS: First of all, there is a cost for the Federal Government but I do accept your point that it is primarily something that businesses do. There will be businesses in different situations and there will quite probably be a wide variance of how people will deal with it. I'm not quibbling with that small business person, but the point that I'm making is the experience that we actually lived through before COVID showed up and during COVID, is that the claims that after the super guarantee was frozen that all of a sudden they would pay the same amount in wages or a similar amount in wages, that didn't turn out to be true. It would be unusual in the extreme for people to fall for the Government's argument that all of a sudden something that hasn't happened for the last six years would miraculously happen after they froze the SG this time.
 
AUSTIN: COVID-19 is the trigger for that unusual and extreme scenario?
 
CHALMERS: But it's the Government that's saying things are going to go back to normal next year. Again you can't have it both ways. This is a partisan point that you expect me to make Steve, but my view is they've been thinking about doing this for a long time, well I actually know that they've been thinking about doing this for a long time, then along comes COVID and here’s the excuse. They will come after it in the May budget. I think your listeners and the Australian community more broadly needs to know that the difference between what the Government wants to do and what Labor wants to do will make tens of thousands of dollars difference to their retirement.
 
AUSTIN: My guest is Jim Chalmers, Labor's Shadow Treasury spokesperson. Also the federal Member for Rankin here in Brisbane. Before I let you go, Jim Chalmers, I just want to harken back to the Robodebt debacle of last week as it reached its zenith, or possibly final stage. Who should be held responsible for that Robodebt debacle and the payout that has to be now made, once again coming from the taxpayers' pocket to innocent people who were pursued wrongly and illegally as it turns out by the Federal Government? Who should be held responsible for that?
 
CHALMERS: There's a handful of ministers, but I think principally the Prime Minister. 
 
AUSTIN: Why?
 
CHALMERS: I read to you here the last time we had a conversation that he was the one who put out the press release in the first half of 2015, saying that he'd come up with a new way to recover these debts and it would mean billions of dollars not paid out to people. He was crowing about being the architect of it then. The reason no minister has hit the fence Steve is because the main person responsible here is the Prime Minister himself. He's not going to sack himself. It makes it harder for him to sack anyone else, whether it's Stuart Robert, or Alan Tudge, Christian Porter or all the other ministers that have been involved in what is the biggest social security scandal in our lifetime. 
 
AUSTIN: Jim Chalmers thanks for your time.
 
CHALMERS: Thanks so much, Steve.
 
ENDS