SUNDAY, 23 JUNE 2019
SUBJECTS: Income tax cuts; Liberals’ economic mismanagement; Labor as the party of aspiration and opportunity; medevac legislation; regional Queensland listening tour; John Setka
MICHAEL ROWLAND: Jim Chalmers, good morning.
JIM CHALMERS, SHADOW TREASURER: G'day Michael.
ROWLAND: Are you persisting with the politics of envy, by not supporting a tax cut for all Australians?
CHALMERS: Of course not. What we're trying to do here, Michael, is to do the right and responsible thing. And as we go through our considerations of the Government's tax package, we'll apply three tests: is it good for the economy? Is it good for middle Australia? And is it the responsible thing to do in the context of a budget where debt has already doubled under the life of this Government? Our highest priority is to get money into the hands of workers and flowing through an economy which desperately needs it. The economy hasn't been growing this slowly since the Global Financial Crisis 10 years ago. We've got stagnant wages, we've got weak consumption; all of these challenges in the economy. So what we'll do, what our highest priority is, is to get that first stage into the economy flowing through the shops and businesses so that we can get the place moving again. The Government's highest priority seems to be that third stage, which as Mathias Cormann just said, costs $95 billion and doesn't come in for another five years or so. So we're taking our time to apply the proper considerations to that. We've asked for more information. We've said to the Government you've already broken your promise to get stage one into the system by the 1st of July. We've offered to bring the Parliament back early to help them keep that promise. They've refused all of that. So we'll do the right and responsible thing. The legislation doesn't come before the Parliament for another 11 days or so. We’ve got some more conversations to have internally.
ROWLAND: What more information do you want? Do you see it as the Government has confirmed, the third stage will cost $95 billion? What else do you want from the Government?
CHALMERS: We want to know what kind of bang for buck we'd get out of that in terms of getting the economy going. We're talking about five years down the track. Our priority is on tax cuts now and sooner, so that we can get the place moving again. They're talking about $95 billion in five years' time. We want to know what that would mean for the budget and what that would mean for the economy. And the information that they don't want to provide us - and if they really wanted us to support the package they would provide it - is we want to know how that $95 billion is distributed through the various tax brackets. Because what we do know is that you get most bang for buck when you give that tax relief to people who are most likely to spend it in the economy. It's a huge outlay of money, $95 billion. It's almost two thirds of the entire tax package. And so I think the Australian people expect us to get all of the information, to have the proper consultations and considerations before we come to a final view. But that shouldn't prevent the Government keeping their promise of getting stage one into the economy. The economy is quite weak at the moment for all of the reasons that I just identified. And what we really need to see, and what Labor's highest priority is, is to get that tax relief into workers' hands as soon as possible to help boost what is a a pretty feeble set of growth figures.
ROWLAND: In fairness terms though, won't a single 30 per cent tax bracket, which is what stage three is all about for people earning from $45,000 to $200,000, end the insidious problem of bracket creep for so many Australians, where if you get a higher wage, you're pushed into a higher tax bracket, that disappears under stage three?
CHALMERS: There are various ways to deal with bracket creep. I think that's the first point. And we have said that we support sensible tax reform that prioritises middle Australia. We've said that all along. There's different ways to deal with it. Our primary concern here, and the reason why we're seeking more information on this $95 billion outlay, is because we want to make sure that it's responsible for the budget. At a time when economic growth is the weakest it's been for 10 years since the Global Financial Crisis; at a time when middle Australia is struggling; at a time when the Government has more than doubled net debt in the budget on their watch, we want to do the right thing. And I think that's completely fine for us to say, well the legislation doesn't come in for another 11 days or so because the Government broke that original promise, and so we will take the time to consider it. And if the Government actually wanted us to support the package, you'd think that they'd provide the information that we're asking for.
ROWLAND: Your colleague, Melbourne Labor MP Peter Khalil, and other MPs privately say, well the Government's got a mandate. They're right, aren't they?
CHALMERS: You don't win a mandate at one election for all of the subsequent elections. And I think one of the things we're seeing here...
ROWLAND: Jim Chalmers, excuse me for interrupting. If the Coalition spoke about anything at this election, at the expense of anything else, it was tax cuts. Surely, it's got a mandate for the full suite of tax cuts?
CHALMERS: Their core promise was that they'd get stage one into the system by the 1st of July. They've already broken that core promise in record time. But the point that I was going to make was this: in their arrogance and in their triumphalism after the election, they want to pretend that they won two elections on one night on the 18th of May this year. And what we've said is that, you went to the election with tax cuts for people on low and middle incomes. You said they'd be in the 1st of July. You've broken that promise. We are prepared to help the Government keep that promise by bringing the Parliament back early and we are enthusiastic supporters of stage one of that package. But you didn't win every subsequent election after that. And we have our own responsibilities to the Australian people. As I said before, our responsibility to the Australian people, and one of the reasons that they put us there, is to be a good opposition; to keep the Government up to the mark; to make sure that when they are proposing such big sums of money, that we run the ruler over it and determine whether it's good for the economy, whether it's good for middle Australia, and whether it's the responsible thing to do in the context of a budget where debt has more than doubled on the Liberals' watch.
ROWLAND: Aren't you being a bit hypocritical? Equally, if the shoe was on the other foot, if you won, your negative gearing changes, your propose franking credit changes would have extended well beyond the forward estimates. You'd be seeking a mandate claiming a mandate as well?
CHALMERS: They would have begun in the subsequent term, Michael, and that's the point that we're making. The tax changes that the Government is proposing in this term of Parliament, after they won the election on the 18th of May, we support those changes which are supposed to be in place by 1 July, but will be in place shortly after that. I think the Parliament would probably unanimously support the tax changes which are proposed for this term of Parliament after the Government won the election.
ROWLAND: Before I move on to other topics, I want to finish with a I guess a philosophical question on this. Your leader Anthony Albanese on Friday said he didn't reckon somebody earning $200,000 was at the top end of town. Do you agree with him?
CHALMERS: Yeah, I agree with the two points that Anthony has been making about this. First of all, we accept that some of the language that we used in the last term, and I used in the last term, didn't strike the right chord in the Australian community. We do acknowledge that. The second point that Anthony is making there is that if you're on a good wicket in this country, we say good on you. That is a good thing. We want more people doing well. We want more people earning more and looking after their families. We want more people finding themselves on a good wicket in the workplace. That is, in essence, what Labor is all about. The Government talks about aspiration as a sort of marketing term that they learned from a focus group. For Labor, aspiration is about opportunity. And providing more opportunity for more people is our reason for being in the Labor Party. And that means better jobs, better wages, better training - all of those things which actually give life to the aspirational instinct that people have in this country.
ROWLAND: Let's go to that medevac legislation. Federal Court ruling this week that asylum seekers wanting to be medically evacuated to Australia don't need to physically consult with doctors. The Government arguing this will again lead to the opening of the floodgates. Is the Labor Party concerned? Two things about that, and also about this legislation being repealed by the Government with the support of the Senate crossbench.
CHALMERS: Well, a couple of things about that. We all know what Peter Dutton is doing here. Peter Dutton is picking an unnecessary fight to try and distract from the substantial economic failures that the Government is responsible for, that have happened on their watch. It's no coincidence that we have the Reserve Bank cutting interest rates to record lows, less than half what they were during the GFC; that we've got the National Accounts figures showing we've got the slowest economic growth for a decade; we've got productivity going down for four quarters in a row over the last year; weak consumption; stagnant wages; rising underemployment. All of these sorts of things, and then all of a sudden, Peter Dutton pops up and wants to pick a fight over the medevac laws, which are working. We've seen more reports that there's only been a couple of instances where people have come here on the advice of doctors that the ministers didn't agree with. I think that just shows what the Government is up to here. And if they want to propose to change the arrangements that were struck in the last Parliament, then they should explain why.
ROWLAND: Okay, you just returned from a three-day listening tour through regional Queensland. Lots of your colleagues are doing lots of listening, understandably after the election loss. It's been five weeks now, so it's an awful time to be hearing people. What have you heard from people in Queensland about why Labor was virtually wiped out in the election outside of Brisbane?
CHALMERS: Well, you're right Michael, I just did a four day road trip, 2800km through 10 towns largely in central Queensland and north Queensland with my colleague Senator Anthony Chisholm. It was a really good opportunity to get some frank feedback on the election campaign and on the policies that we took to the election. I think in Queensland, we did under-perform. We only got every fourth primary vote. Clearly that's not good enough, and we lost a very good senator in Senator Chris Ketter. So we've got a lot of listening and a lot of learning to do, and that's what the trip was about. I think obviously, there were some issues around the complexity of the tax proposals that we took. We couldn't build a big enough constituency for those changes. Obviously, the lies that were told about the death taxes and pension cuts, we couldn't get on top of them effectively or early enough. Clive Palmer's $60 million dollars in ads attacking the Labor Party obviously didn't help. So all of those reasons were common around Queensland and probably around the country too. But I think as well in central Queensland and north Queensland, there was a perception, right or wrong, that we were sending mixed messages on the coal industry. Really the main message I took from up there, or one of the main messages, was that if we are to get the national economy growing again, we need to make sure that regional economies are growing strongly. That means building on our traditional strengths, whether it be agriculture or mining or tourism, not abandoning those strengths. And so that message was heard loud and clear. It was a very productive way to spend four days in the best state in Australia, going around those regional towns and I'm very grateful for the people who made their views known.
ROWLAND: John Setka, Victorian union boss of the CFMEU appears in court this week where, if his lawyer's to be believed, he'll plead guilty of those harassment charges. If he does do that, if he stands up in court and pleads guilty, should that be the tipping point, the catalyst for his supporters, people supporting him at the moment to withdraw their support?
CHALMERS: Obviously, I'm not going to get into the legal matters that are before the courts, but I think the main issue here, the issue that we are responsible for, is John Setka's membership of the Australian Labor Party. I support 100 per cent Anthony Albanese's moves to expel him from the Labor Party. The other issues around his role in his union, or in the broader union movement affiliation with the ACTU, all of those issues are matters for the unions. The bit that we control is his role in the Labor Party. I think Anthony did the right thing in standing up and saying there's no place for him in the party, and we all support that wholeheartedly.
ROWLAND: Should the ACTU, should Sally McManus the ACTU boss, move to formally disaffiliate the CFMEU from the ACTU?
CHALMERS: That's a matter for Sally. As I said, there are two issues here, and they're getting conflated. We're responsible for his role in the Labor Party. We're saying he shouldn't have an ongoing role. The matters for his role in the broader union movement are matters for Sally, who's a terrific leader...
ROWLAND: Yeah, but is that something you'd support? Disaffiliation? You must have a view on that?
CHALMERS: It's not really a matter for me, his affiliation or the affiliation of the union. I'm not going to get ahead of the legal processes, which is where your question came from. It's not for me to determine his role in the union, or even to determine his union's role in the broader union movement. Anthony and I and the people in the Australian Labor Party are responsible for his membership of the party. I think it's a good thing that he be expelled from the party. That's the bit that we're responsible for.
ROWLAND: Jim Chalmers in Brisbane, thank you for joining us.
CHALMERS: Thank you Michael.