ABC RN Drive

July 12, 2016



SUBJECT/S: Superannuation Policy; Labor Frontbench; Indigenous Recognition

PATRICIA KARVELAS: Jim Chalmers is the Shadow Minister for Financial Services, Superannuation and Sport. Welcome to RN Breakfast and congratulations on your re-election in Rankin.


KARVELAS: Yeah, I'm fit as a fiddle, mate, post-election.

CHALMERS: No rest for you?

KARVELAS: No absolutely not. You've been telling us for months that parts of the Government's superannuation policy are retrospective. Why do we now need an inquiry? Because you seemed very certain and now you're saying you need someone else to tell you.

CHALMERS: Well we're just asking the Government to do what we committed to, which is to have a proper look at these pretty dramatic and drastic changes which were dropped on the table on the eve of an election. The Australian people expect us to take the time to get them right. They don't want us to do what the Government has done which is to rush to judgement on these changes which have big impacts on retirement incomes. We've said all along that one of our big concerns is the retrospective nature, particularly about that $500,000 non-concessional cap. And as I have conversations around the country about these super measures with stakeholders and with the community, it is that retrospectivity that people are most concerned about.

KARVELAS: Do you personally, Jim Chalmers, think this is retrospective? You've been studying this since May, you're an economist, surely you have a view?

CHALMERS: I do have a view. I think that $500,000 cap which is back-dated to 2007 is the very definition of retrospectivity. I've got a lot of respect for John Daley who you just played a clip from; he has expressed that view before. But I think it's pretty hard to cop a view that says that something that is back-dated and calculated from 2007 but not announced until 2016 is anything other than retrospective. All we're asking for is the time, and the Government should take the time given they've got this very serious internal dissent over this issue, to take the time to get it right because people's retirement incomes shouldn't be messed with on a whim. You need to make sure that people are in the cart, that they're consulted, and that any changes are made really carefully. One of the defining features of this election campaign and the defining failure of the Government when it comes to superannuation is that they asked the Australian people and the Labor Party to sign up to a series of changes that the Government itself couldn't explain, couldn't defend and couldn't guarantee would be in place, even if they won the election.

KARVELAS: If you're just tuning into RN Breakfast, my guest is Jim Chalmers, he's the Shadow Minister for Financial Services and Superannuation. If there is an independent expert review and it considers that the Government's policy is not retrospective, because there are people, as you've just heard, the Grattan Institute saying it's not, would you support the legislation through Parliament?

CHALMERS: We've said we would support anything which turns out to be workable and fair. We've made that announcement during the election campaign and that's the approach we still plan to take to superannuation. If it turns out that when you look at all of these changes in their totality, in isolation and the way that they interact with each other, if there's a case that can be made that they're workable and fair then we will support them. If there are improvements that could be made, for example, if you could make that $500,000 cap prospective rather than retrospective, that's worth a discussion, that's worth looking at. But we'll do what we've always said we'll do when it comes to super. We do think that the tax concessions are poorly targeted, particularly at the top end. So what we've said and what we still say after the election is that we will agree where we can with the Government, but we will disagree where we must.

KARVELAS: This measure you're now saying could be retrospective, the $500,000 lifetime cap on after-tax contribution, would save the Budget, I think it's about $550 million over four years. Given the warnings from ratings agencies in recent days, aren't you risking Australia's AAA credit rating if you oppose these measures?

CHALMERS: Not at all. I don't think that's the case, Patricia. I think if you're serious about the warnings about the downgrading of the AAA that was first won from all three ratings agencies under Labor, if you're serious about that credit rating, you wouldn't be proceeding with a fifty billion dollar tax cut to big business. That should be the first port of call if you're serious about repairing the Budget. That's really the centrepiece of our plans to contribute constructively to this big task of fixing the Budget bottom line. I do think that we should take those ratings agencies very seriously when they say that they've got an issue, and what they make very clear and what we have made very clear is that in this context, the country cannot afford to give fifty billion dollars to big multinational corporations when there are so many other calls on the Budget, so many other fiscal challenges to deal with.

KARVELAS: Scott Morrison, on another topic, is under some internal pressure to scrap the backpacker tax. You were in this bizarre position in the run-up to the election where you were calling on the Coalition to axe it but you couldn't commit to doing it yourself if you won. The tax is worth $540 million over four years to the Budget. Would you support legislation to remove it permanently?

CHALMERS: Those conversations are still to be had. We've made our position clear in the election campaign that we thought the way they went about that backpacker tax, a bit the same as how they have gone about superannuation, was ill-considered. The other parallel with superannuation, of course, is that there's fairly substantial internal dissent and chaos inside the Liberal Party when it comes to this issue. No doubt these things will play out once we finally get the make-up of the Senate, the make-up of the Parliament and Malcolm Turnbull responds to what was a fairly serious kick in the teeth in this election.

KARVELAS: Bill Shorten will be re-shuffling the frontbench. He says he has the happy problem, that's how he describes it, of having a lot of talent and a limited number of positions for all that talent. Should David Feeney keep his portfolios? Mr Shorten refused to back him yesterday.

CHALMERS: Well I think Bill was right to say that there's an abundance of talent in the Labor Party. We've always in my experience got more good people than we've got spots. We're never sort of scratching around, making up the numbers when it comes to our frontbench. The way that it works in our show is that the Parliamentary colleagues determine who goes on the frontbench in the first place and then Bill allocates the jobs and the portfolios amongst them. So that process hasn't concluded yet. It's only really starting to get underway. So whether it's David or anyone on the frontbench, anyone in the Parliamentary Party, that's yet to be resolved.

KARVELAS: But I'm asking for your personal view. David Feeney had a real shocker of a campaign. I don't think anyone would dispute that. Do you think he should be demoted?

CHALMERS: Well David himself has said that he didn't have the perfect campaign. I've got a lot of time for David--

KARVELAS: Understatement of the year! 'Not the perfect campaign.'

CHALMERS: I've got a lot of time for David. He's one of our very good colleagues. Whether he's on or off the frontbench, in the same way as for everyone else, will be determined in the coming weeks.

KARVELAS: Would you expect to see promotions for younger MPs, I suppose including yourself, Jim Chalmers? I mean, is it a good time, for instance, to promote more women? Could Anne Aly go straight into the Shadow Minister to make use of her counter-terrorism expertise for instance?

CHALMERS: It's always a good time to have contributions made by some of the terrific female members of the Parliamentary Labor Party. That's always a good thing. We've already got some outstanding members serving on the frontbench. We're very lucky, whether it's the people elected for the first time in 2013, or the people elected for the first time just over a week ago, there are some outstanding people. I was sitting in the Parliamentary caucus room, looking around and seeing all these terrific people who have just been elected, including Anne as you said, but also people like Tim Hammond and others around the country, Milton Dick in Queensland and others. We do have heaps and heaps of good people coming through, younger people, newer people, and whether they make a contribution to this frontbench or to a future frontbench, I'm really proud and really confident that we will have a good team for some years to come.

KARVELAS: Just finally, just a question on indigenous recognition. Chris Sarra has said that there needs to be a treaty. This proposal of a treaty did actually play a bit of a role in the campaign after Bill Shorten said it should be on the agenda. Is that still a priority for Labor?

CHALMERS: I think it's still on the agenda. I thought that was terrific, the contribution that Bill made in the campaign, to really broadening the discussion about indigenous recognition. We do of course want to see that constitutional recognition but that needs to be one part of what we do in this area. I think it was well-received what Bill said. I know someone like yourself has had a long-standing interest in these issues and the national conversation goes on beyond what we need to see when we change our Constitution to recognise our indigenous people.

KARVELAS: Jim Chalmers, many thanks for joining me this morning.

CHALMERS: Thanks Patricia.

KARVELAS: That's Labor's Shadow Minister for Financial Services, Superannuation and Sport, Jim Chalmers.