E&OE TRANSCRIPT
DOORSTOP

BRISBANE
SUNDAY, 18 DECEMBER 2016

SUBJECT/S: Mid-year Budget update; Government risking AAA credit rating; Australian republic; One Nation and Queensland election

JIM CHALMERS, SHADOW MINISTER FOR FINANCE: The Turnbull Government has no one to blame but itself for a deterioration in the Budget that has seen net debt blow out by more than $100 billion, the deficit more than triple and now Australia's coveted AAA credit rating at risk. The Government could lock in Australia's AAA credit rating with a stroke of a pen in the mid-year update by ditching its plans to give $50 billion to big business and by proceeding with Labor's plans to change the negative gearing and capital gains arrangements in this country.

If the AAA credit rating is lost by Malcolm Turnbull and Scott Morrison, it will smash confidence in our economy and it will push up borrowing costs for households and small businesses. If the AAA credit rating is lost by Malcolm Turnbull and Scott Morrison, it will mean that Australians will pay higher mortgage repayments, and that will be a high price to pay for this Government's incompetence. If the AAA credit rating is lost by Malcolm Turnbull and Scott Morrison, it will mean they place a higher priority on that $50 billion tax cut for the top end of town than on the mortgage repayments that people pay in middle Australia.

The difference between the Turnbull Government and the Labor Opposition could not be clearer. We place a higher priority on the mortgage repayments that people pay in middle Australia, while this Turnbull Government places a higher priority on that $50 billion gift to the top end of town. If the Government loses the AAA credit rating after the mid-year update, it will show that they have deliberately chosen to risk that AAA credit rating so that they can proceed with that $50 billion tax cut, which the country can't afford and shouldn't proceed with.

This is a Government that promised to fix the Budget and to have jobs and growth in our economy. Instead, we've got growing deficits, a shrinking economy and 50,0000 full-time jobs have been lost this year alone. With a record of incompetence like this, it's no wonder that the Government is trying to hide these outcomes by releasing the mid-year update just six days before Christmas.

For a symbol of the division and dysfunction in the Government and its economic policy, look no further than this debacle over the Green Army. The Green Army, when it is abolished in the mid-year update, will attract more criticism from Tony Abbott and others in the Liberal Party and it will also show that there's a $40 million hole in the Government's costings; a $40 million hole in the mid-year Budget update because the Government is so incompetent it didn't factor in that abolishing the Green Army means more people will go onto unemployment benefits. And that just shows how incompetent, how divided and dysfunctional this Government is.

JOURNALIST: But surely though the current Government can't be entirely to blame for the Budget (inaudible)?

CHALMERS: The Government is responsible for the mess they've made of the Budget. They've been in Government now for more than three years, they've taken deliberate decisions like the $50 billion tax cut, but other decisions as well, which have deteriorated the Budget bottom line. What they have shown, and what they will show in the mid-year update, is you can't fix the Budget with slogans and finger pointing alone. It's long past time that the Government took responsibility for the mess they've made of the Budget. The growing deficits and the growing debt are the fault of the incompetence of Scott Morrison and, before him, Joe Hockey and Malcolm Turnbull and, before him, Tony Abbott.

JOURNALIST: So you don't think Labor should take any responsibility for the Budget mess and the growing deficits?

CHALMERS: Labor has, and will continue to, engage constructively when it comes to repairing the Budget in a fair way. We think the Government could fix this debacle and lock in the AAA credit rating if they abolish their $50 billion tax cut, picked up those suggestions that Labor has responsibly made to reform negative gearing and to reform capital gains tax in this country. We will continue to play a constructive role, suggesting ways for the Government to fix the Budget in a fair way; in a responsible way; in a way that doesn't smash Medicare or ask the most vulnerable people in our community to carry the can for the Government's incompetence.

JOURNALIST: Was the deficit growing under Labor?

CHALMERS: The deterioration in the Budget under Labor was largely a consequence of the Global Financial Crisis, the sharpest synchronised downturn in the global economy since the Great Depression, and the necessary policy response. This Government has no such crisis to point to. The Budget has deteriorated on this Government's watch because of their incompetence, because of their $50 billion tax cut and other decisions they've made to deliberately jeopardise Australia's AAA credit rating. And if the AAA credit rating is lost on this Government's watch, people in middle Australia will pay more for their mortgage repayments.

JOURNALIST: Just on the republic debate, what are your thoughts on Malcolm Turnbull's idea to (inaudible)?

CHALMERS: Well here we go again. After Malcolm Turnbull sold his soul on climate change and marriage equality, now he's out there making excuses to go slow on an Australian republic. If Malcolm Turnbull actually led his party, rather than followed it, he would take up Bill Shorten's well-motivated suggestion that the two parties get together and work together to have an Australian head of state; to have a head of state that is one of us. The time is long past for Australia to have a head of state that is one of our own so that we can go confidently into our region as a republic. Malcolm Turnbull once believed in this. A long time ago he wouldn't have made these kinds of excuses to go slow on a republic. So here we go again, more excuses from the Prime Minister, deja vu – first marriage equality and climate change and now the republic.

JOURNALIST: Just on reports that One Nation is expected to announce candidates in all seats in the Queensland election. What are your thoughts on that?

CHALMERS: We take One Nation very seriously. We certainly take the people who are prepared to vote for One Nation very seriously. We understand that not just in Queensland, but right around the country, there are people who are sufficiently disillusioned with the Government and with politics as usual to consider other alternatives. I think principally, that's because we need to – all of us need to – show people that there is a place for them in the modern economy. That's why on the Labor side, we are so dedicated to ensuring that economic growth in this country is inclusive, that hard work is rewarded and that there's a safety net for those who are left behind. But we take One Nation seriously. Here in Queensland, it will boil down to a choice between a Palaszczuk Government, which is focused on jobs and delivering jobs and delivering for our communities right around the state, and a Tim Nicholls-led Opposition, remembering that Tim Nicholls of course was the architect of everything that people hated about the Newman Government – the privatisations and the like. So that will be the choice that people will face here in Queensland. Obviously, One Nation will field their candidates. We take those candidates seriously and we will engage on the issues in a respectful way. But I'm confident that when people weigh up the alternatives here in Queensland, they will understand and they will appreciate the good work that Annastacia Palaszczuk and her senior colleagues are doing to deliver for Queensland. And they will evaluate Tim Nicholls, who at the end of the day was Campbell Newman's right-hand man and the architect of what people rejected so comprehensively at the last state election.

JOURNALIST: How threatened should the two major parties be? I mean, there is talk that One Nation could make significant inroads at the Queensland election.

CHALMERS: Well that remains to be seen. But again, Labor takes the electoral threat of One Nation very seriously. But more importantly than that, we are out there in the communities right up and down the Queensland coast and out into the bush, around the suburbs of Brisbane and beyond, listening to the very legitimate and very real concerns that people have. And because we've been doing that listening – at the state level, at the federal level, right around Queensland and right around Australia – I'm confident that we have the capacity to convince Queenslanders and Australians that we hear what's making them unhappy and we have the capacity to fix it. Unlike the Turnbull Government in Canberra, which is single-mindedly focused on a $50 billion tax cut for the top end of town and resisting a royal commission into the banks and a whole range of other policies. And here in Queensland, Campbell Newman's right-hand man wants to be installed as the Premier despite being the architect of everything people despised about the Newman era.

ENDS