E&OE TRANSCRIPT
DOORSTOP
PARLIAMENT HOUSE, CANBERRA
WEDNESDAY, 5 DECEMBER 2018

SUBJECTS: National Accounts; Liberal party infighting around watered down divestment powers.
 
CHRIS BOWEN, SHADOW TREASURER: Thanks for coming everyone.
 
What we have today is a very disappointing set of figures for Australia and Australians. This is a very bad set of numbers. A bad set of numbers on the watch of the Abbott-Turnbull-Morrison Government. We have growth at 0.3 per cent, 2.8 per cent for the year, in the light of a very positive international economic environment. In light of a growing global economy, for Australia to be performing so poorly is an indictment on the economic management of the Government. Josh Frydenberg and Scott Morrison like to boast that Australia is growing faster than the G7, well we are not, we are growing slower than the average of the developed world and slower than the United States, the United Kingdom, New Zealand, and Canada.
 
And within the figures there are disappointing numbers: the slowest growth in household consumption in six years and the lowest household savings rate in more than a decade. Now, I saw the Treasurer rather bizarrely claim that that was a sign of confidence in the economy, that the household savings rate was so low, earlier today. The Treasurer might want to reflect on that, take his L plates off and have a think about that. A low rate of household savings, the lowest in over a decade, is somehow a sign of confidence in the Australian economy, well it is not. And worryingly, the savings rate has been a contributor to economic growth for some time now, and now as it continues to fall, at some point, must hit the bottom. We must be close to that point now.
 
Of course, investment is down, another sign that we need the Australian Investment Guarantee that only Bill Shorten and Labor will deliver – a 20 per cent upfront deduction to spur investment which is just what the economy needs. What the economy needs overall is stability and certainty. Stability in government in personnel and in policy. The Liberals just can’t deliver on that but Labor can. We’re seeing this in the latest policy iteration that will have such a damaging effect on the economy, through the rolling farce and lack of an energy policy, particularly at the moment, divestment. This ‘policy’, and I use the word loosely, a pretty poor excuse of a policy, which has to be rewritten in the last 24 hours, because it has fallen apart under its own weight. How is that for the stability and certainty that investors need, we need stability and certainty in investment in energy to get power prices down so that we can then get more investment. This ‘policy’ has been a farce, a complete failure, by Josh Frydenberg and the Government.
 
One aspect that hasn’t received much attention in the divestment policy is that would enable the Federal Government, through various mechanisms, to force the privatisation of state resources. The Queensland, Tasmanian and Western Australia, the power companies are in public hands, of course the Snowy Hydro is in Commonwealth ownership.
 
Now as Angus Taylor has himself confirmed, in fact he seems proud of the fact, that it would require the compulsory privatisation of the power assets in those jurisdictions. If the Liberals and Nationals wants to argue for privatisation they should make that their policy at the state level, so the people can decide. We don’t believe that power privatisation puts downward pressure on power prices, quite the contrary. To add to those remarks I invite my colleague the Shadow Finance Minister and senior Queenslander, Jim Chalmers to speak, and then we will take questions.
 
JIM CHALMERS, SHADOW MINISTER FOR FINANCE: Thanks very much, Chris. And as Chris rightly points out, the Liberals' disastrous divestment policy will reduce investment and push power prices up, and we have now had it confirmed that it could force the privatisation of public assets in my home state of Queensland. This is a disastrous and dangerous policy, which has been plucked straight from the Liberals' dumpster fire of internal division and energy policy dysfunction. 
 
Queenslanders are being poked in the eye with the big stick. They have made their views repeatedly known. The people of our state have said repeatedly that they don't want their public assets sold. The big stick has become a big garage sale of Queensland's public assets. Every LNP Member and Senator who has gone along with this disastrous policy - just meekly followed along with Scott Morrison - has shown that they are disastrously out of touch with the views of Queenslanders.
 
What this means is the people of Queensland can either keep their energy assets in public hands, or they can keep the Morrison LNP Government, but they can't keep both. It is long past time for the LNP Members and Senators to raise their voices, to do the right thing by the people of Queensland, and tell Josh Frydenberg and Angus Taylor and Scott Morrison to admit that they have badly stuffed up this policy and to ditch it once and for all.
 
BOWEN: Over to you, folks.
 
JOURNALIST: Mr Chalmers, Josh Frydenberg just said less than an hour ago that it wouldn't lead to privatisation, it would just - if they used divestment against Queensland, it would force another Government entity to be created. Is that just the whisky talking or do you know something he doesn't?
 
BOWEN: Do you know something we don't?
 
CHALMERS: (Laughs) It sounds like the whisky talking, Phil. Angus Taylor has made it very clear that one of the consequences of this disastrous divestment policy is that public assets could be forced to be sold. There's not a heap of buyers out there which aren't private sector buyers, of course. Campbell Newman took this policy to recent Queensland state elections and Queenslanders made their views known. Angus Taylor, Scott Morrison, Josh Frydenberg and all of the LNP Members and Senators - their policy as it currently stands is a recipe for privatisation of public assets. It's a poke in the eye with the big stick and we've heard repeatedly in this building and around the country in the last little while that this policy will reduce investment and increase prices and now we know as well it will force a big garage sale of public assets which Queenslanders don't want and which the LNP is too out of touch to listen to.
 
JOURNALIST: But a Government entity isn't privatisation, is it?
 
CHALMERS: I beg your pardon?
 
JOURNALIST: A Government entity isn't privatising it? If you transfer the ownership of a generator to another Government entity, that's not privatisation?
 
CHALMERS: Angus Taylor has confirmed in The Courier-Mail today that one of the consequences of this disastrous policy would be privatisation. It is abundantly clear to anyone who looks at the energy market that if the Queensland Government were forced to sell these assets, the most likely outcome would be a private sector buyer.
 
BOWEN: And just to add one thing to that. Of course part of the problem with this chaos and dysfunction is with respect Phil, you haven’t seen the legislation, we haven’t seen the legislation, I don’t believe the Liberal Party room has seen the legislation, the industry hasn’t seen the legislation, the people haven’t seen the legislation because when last we checked the legislation hasn’t been written. I mean the government was threatening to introduce it today. Unless it has been introduced while Jim and I have been outside here, it might be happening as we speak but it hasn’t been introduced before now. I mean they had had five years in office. We were told this was urgent, we should pass it this week. Well guess what: Here we are on Wednesday just before Question Time when the Treasurer is finally getting around to introducing the legislation. If he’s got some mechanism in there to say he shan’t force privatisation, he’ll only ever transfer it to another government entity, well good, but I don’t think it says that and he could clear that up by obviously by having handled his job with more efficiency and professionalism that he has.
 
JOURNALIST: Mr Bowen on the National Accounts do you think that we are going to see a fall in momentum further through the year and how will that feed into MYEFO and possibly next year’s Budget?
 
BOWEN: Well Jim and I are always very careful not to be alarmist in our comments and not to talk the economy down. We will call it as we see it but we are also very careful unlike Opposition’s past, i.e. the people who are now the Government who weren’t so careful and were happy to talk to economy down. We will always keep out remarks well balanced and moderated but we will call it as we see it. And of course today’s figures will reflect in MYEFO. Of course they with. That’s a matter for the Treasurer to account for and they won’t reflect positively, they won’t reflect positively but we will see.
 
Jim and I will be responding to MYEFO from Adelaide when it comes out. We will provide further commentary there but what we know, what we already know of course is the Government likes to boast that they delivered a surplus. They have not. They are forecasting a surplus. They told us they are forecasting a surplus. Fair enough, that is not delivering a surplus. Point one. Point two, we know it’s on the back of taxpayers who are taking an increased burden under this Government’s watch. We know that for a fact as well. We know that as we speak the Government has not funded preschool for four-year-olds. Either they are going to cave in on that policy or it will be reflected in MYEFO so these are things we know about MYEFO and will provide further commentary when we see it.
 
JOURNALIST: Mr Bowen you have described the figures today as disappointing. Wouldn’t you regard that in some ways as talking the economy down given the 3.4 per cent figure last quarter?
 
BOWEN: Eryk Eryk Eryk, really? We have been as I said, we emphasise responsibility in our comments but I’m not going to pretend that a growth figure with a two in front of it in this benign economic environment is cause for celebration. It is not, the Government should be very disappointed. The Treasurer should be honest enough to admit that it’s disappointing. I don’t expect him to talk the figures down, I expect him to be honest about the figures. I mean does he honestly say this is what he expected? Is he honestly saying he wouldn't have hoped for better? Is the Treasurer really going to put that case to you? I'd like to see that. 
 
JOURNALIST: And why do you think it is substantially lower than what was forecast?

BOWEN: Well I mean just going through, as I said, household consumption down, lowest in six years, investments down. All in all there's a number of factors which have led to this. But the ones that concern me going forward are household consumption and investment. They are the two drivers of the economy. 57 per cent of the economy is consumption and that's down. Growth is down. That's concerning for the economy. Of course when growth is down like that it's going to have a big impact.

JOURNALIST: You could inherit a slowing economy next year, what are you going to do about it to get that consumption up?
 
BOWEN: Well firstly I think the Australian people respond well both in their general demeanour and their spending to stability and certainty in government policy and personnel. I mean Scott Morrison warned the Australian people that political dysfunction in Canberra before the Wentworth by-election would have an economic impact. Here's some words you're not going to hear me say very often, Scott Morrison was right about that. He was right about that. The dysfunction and chaos, that part of this Government, is having an impact, point one. Here we have a stable leadership team five years in the job, Bill, Tanya, Penny and myself, a stable economic team with Jim and I leading it, and stability of policy.
 
Of course we have our tax cuts which are beneficial to those millions of Australians who earn less than $125,000, every one of them better off under a Labor Government. That will be reflected in their confidence no doubt, of the Australian Investment Guarantee which will reflect in investment. And we will see the Australian people being able to say 'we have a Government whose personnel we know, whose policy we know, and who can provide a stable policy environment'. This Government is pathologically incapable of all of the above.
 
CHALMERS: I might just add to that, Chris, if I can. Eryk, this election's going to be a choice between two very different views of the economy. What the Liberal Party wants you to believe is if they shower largesse on the top end of town it will miraculously trickle down and feed consumption in low and middle-income Australia. What we say, with our bigger, fairer tax cuts which Chris and Bill announced some months ago, is that we think the priority for tax relief should be people on low- and middle-incomes. They're more likely to spend; they're more likely to get that consumption going so that we can get that inclusive growth that we need in the economy. Very different approaches to who deserves tax relief. The Liberals will always go to the wall for those big tax concessions and loopholes, which overwhelmingly favour the top end of town. We have a very different view. The economy has been growing despite the Government, not because of it. Their policy agenda has been very narrow. It's been about company tax cuts, which failed. It's been about big tax cuts for people on the highest incomes, and that will fail as well. So it will be two very different approaches.
 
To Shane's question before about MYEFO, the Government has had billions of dollars rolling through the door and yet we still have debt which is more than double what the Government inherited from Labor in 2013. Net debt is more than double what the Liberals inherited from Labor, despite the fact that they've had a relatively strong global economy and billions of dollars rolling through the door. They've run out of excuses for failing their own test on debt. As Chris rightly points out, the vast majority of those improvements to the Budget, which they're crowing about and they're about to crow about in Question Time now, have been tax increases; improved revenue. We're something like $9 billion ahead this financial year of what they forecast in the Budget and $6 billion of that is more taxes. That is nothing to do with the efforts of Scott Morrison or Josh Frydenberg. They've been hit in the bum with a fiscal rainbow and so they've run out of excuses for debt doubling on their watch.
 
JOURNALIST: So Mr Bowen you said you don't buy the Treasurer's line that the household savings ratio reflects confidence in the economy and low interest rates, do you mind clarifying exactly why you think Australians are saving less?
 
BOWEN: Well look Australians are saving less because their budgets are under real pressure. Wages aren't going up enough and costs are going up too much. I mean whether it's electricity, whether it's private health insurance premiums, wages aren't keeping up. Now the Government seems to have declared mission accomplished on wages. Australians are saving less because in many instances they are earning less. They've lost their penalty rates in thousands of cases, and they are not keeping up with increased cost of living. Now if Mr Frydenberg thinks that's a vote of confidence, I'd hate to see a vote of no confidence, I mean I'd hate to see a lack of confidence in the Australian economy. If he wants to boast about the lowest household savings rate in ten years, really? That's his boast? He's proud of that? Well if I were Treasurer I'd want to be proud of something other than that. 
 
JOURNALIST: So to Mr Chalmers' point, the main point of tackling that it is through the low to middle income tax cuts at this point?

BOWEN: Well it's a very important part of our agenda, we didn't do it for fun. It's been a long time since low and middle income earners received tax relief. This Government has had different sets of priorities. We will provide tax relief for those millions of Australians who earn less than $125,000. Superior tax cuts to the Government. Only a Shorten Labor Government will deliver that, only a Shorten Labor Government. 

JOURNALIST: But are there any other measures that you might consider beyond those?

BOWEN: Well we've got our Investment Guarantee, we've got our cap on private health insurance rebates. We've got the stability and certainty that we will bring energy policy to put downward pressure on prices, not upward pressure due to the lack of investment on this Government's watch because of their utterly incomprehensible dysfunction and chaos. 
 
Okay I think that's a wrap. Thanks guys. 
 
ENDS