SATURDAY, 9 MARCH 2019
SUBJECTS: Speculation about Liberals’ desperate tax cuts on eve of election; Labor’s policies benefitting working people; Liberals’ “deliberate” low wages growth; minimum wage; Coalition chaos, division and dysfunction; franking credits
JIM CHALMERS, SHADOW MINISTER FOR FINANCE: You know there's an election just around the corner when the Liberal Party all of a sudden starts to pretend that they care about working people in this country. Desperate tax cuts five-and-a-half weeks from an election won't make up for five-and-a-half years of cuts and chaos from these Liberals keeping ordinary working people down. For the entire life of this Liberal Government - for more than five years now - the top priority of Tony Abbott, then Malcolm Turnbull and now Scott Morrison has been the top end of town. This is a party that wanted to give a $17 billion tax cut to the four big banks and an $85 billion tax cut to the big foreign multinationals. If they win the election, those tax cuts will be back on the table. Because this is a Liberal Party which always favours the top end of town at the expense of everyone else. I encourage people to look at their record, and not what they say on the eve of an election.
Labor actually cares about the take home pay of working people in this country. That's why we've got bigger, fairer tax cuts for everyone earning up to $125,000 a year, and that means 10 million Australians - and 70 per cent of taxpayers - will be better off under Labor. And that's because we do recognise that the economy's not working for ordinary working people. People feel, with some justification, that everything is going up in this country except for their wages.
While the Liberals and Nationals fight with each other over energy policy, over the leadership, over why Malcolm Turnbull was dumped in the first place, the economy is floundering and ordinary working people are struggling. We had in the National Accounts just released the other day slowing growth, stagnant wages, and we know that debt has doubled in this country and is at record highs under this Liberal Party.
If people want to know what the Liberals really think about take home pay and putting more money in the pockets of working people in Australia, they only need to look at what Mathias Cormann said yesterday. Mathias Cormann said yesterday, when asked about record low wages, that was a "deliberate design" feature of their policy. Under the Liberal Party, record low wages is a deliberate outcome. It's not an accident. It's not something that has happened out of the blue. It is something that the Liberal Party in this country actively seeks - lower wages for Australian working people. And that's what we have at the moment with these record low wages.
What Mathias Cormann said yesterday wasn't a gaffe, it wasn't a stuff up. What Mathias Cormann said yesterday, this was the Liberal Finance Minister of this country outlining a key part of their economic plan. Under the Liberal Party, their three-part economic plan is to keep wages low, keep workers insecure, and to keep looking after the top end of town.
The Australian workforce, and the Australian people, get an opportunity to judge this Liberal Party - this divided and out of touch Liberal Party - at the election in May. They get to cast their vote and make their decision, and make their voices heard about whether or not they want to go down this path. This path of an economy that's not delivering for ordinary working people. This economy where everything is going up except for people's wages. This economy which is currently managed by a Liberal Party whose deliberate policy is to keep wages down. That's what they really think about working people in this country, and no amount of tax cuts on the eve of an election will change that basic fact.
JOURNALIST: Jim, there's reports the Morrison Government's considering tax cuts. Those of us on the average wage, and lower, would all like to see more money in our pockets. Surely it's a good thing?
CHALMERS: We want to see more money in workers' pockets too. That's why the Labor Party has a plan for bigger, fairer tax cuts for 10 million working Australians. 70 per cent of taxpayers will be better off. Everybody who earns up to $125,000 is a priority. Middle and working Australians in this country will be better off under Labor. We also want to make sure that we can fix and address record low wages in this country, remembering that every [quarter] of wages growth in this country has been lower than any [quarter] under the former Labor Government. Wages growth every [quarter] under this mob lower than under its predecessors. So we want to see bigger fairer tax cuts for people on low and middle incomes. We want to see better wages growth for people on low and middle incomes. We have policies to deliver both of those things. The Liberal Party has spent more than five years now looking after the top end of town. They want to con the Australian people on the eve of an election into believing that all of a sudden they care about take home pay, but they don't.
JOURNALIST: (inaudible) are going to be good for those, for example, just say they were good for those under $125,000 a year. That's a good thing, right?
CHALMERS: It remains to be seen whether there'll be tax cuts in the Budget. Labor's already announced our bigger fairer tax cuts for everybody earning up to $125,000. There is speculation today on the front page of a national newspaper. It remains to be seen what will be in the Budget. But what we've said all along is that the economy's not working for people of modest means. We need to address that via the tax system, and also via wages growth. The Government has failed spectacularly on both counts and so they shouldn't be trusted on the eve of an election when all of a sudden they pretend to care about people who work and struggle in this country.
JOURNALIST: Jim, on the arguments from some of the business sector on the impact of Labor's living wage, or minimum wage plan. The recent tax data shows that almost one in three small businesses fail to pick up a profit. If Labor boosts the minimum wage, could it force them to close?
CHALMERS: I don't think so. One of the problems that we have in the economy, and one of the reasons why conditions are very soft for small businesses and medium sized businesses is that people just don't have the money to spend and invest in the local shops or the local small and medium sized businesses. We think with a responsible wage increase around the country, that will be good for the economy. And when the economy's growing properly in an inclusive way, that's good for small business too.
JOURNALIST: Is there an inevitable trade-off between wage growth and employment? In other words, we pull the levers to increase the wages, but the unemployment levels going to go up?
CHALMERS: I don't accept that that's inevitable. What I'm saying is that the economy is soft, the economy is slowing, wages are stagnant, consumer sentiment, business sentiment - all of that is very weak. What we need to do in this country is build confidence in the economy. That means making sure that people have the money they need to spend and invest and look after their loved ones. And when they do that, we can all prosper together, including and especially small businesses.
JOURNALIST: What can you say to allay concerns that have been flagged from within the business community from the impact of the levers that you've indicated you may pull to try and increase wages?
CHALMERS: The assurance I would give is that we care about growing the economy in an inclusive way so that the small and medium sized businesses of this country can prosper, can keep hiring people, can keep doing all the good that they do in local communities like this one. We do that by ensuring that the economy can grow in a sustainable way. One of the obstacles we have to good economic growth at the moment is that people don't have the take home pay that they need to spend and invest and look after their loved ones, and we intend to fix that.
JOURNALIST: What do you make of what's happening in the Nationals at the moment. Do you think McCormack could be at risk?
CHALMERS: The Coalition is a dumpster fire of personal ambition, grudges and long-term acrimony. We read on the front pages of the papers almost every day that there's another leadership blowout in the National Party or the Liberal Party. We've lost track of the number of times now that there have been threats made against the leaders of either of the Coalition parties. Labor is presenting the more stable alternative in this election. We've had the same Leader for five-and-a-half years. The same Deputy Leader, same Shadow Treasurer, same Senate Leader. We are a model of stability. The Australian people are crying out for stability. That's the only way we'll get some of these big challenges in the economy addressed. The National Party and the Liberal Party have proven themselves incapable of it because they're so divided and so out of touch.
JOURNALIST: Do you think, realistically, that kind of instability in the junior partner of the Coalition would actually have an impact on the Coalition's prospects this election?
CHALMERS: I'll leave that for the commentators. But what I do know is that while the Liberals and the Nationals are fighting with each other over the leadership, about energy policy, about a whole range of matters, the Australian economy is floundering and people are struggling. For as long as the National Party and the Liberal Party keep playing these ridiculous games, ordinary working people aren't getting a look in. And we're seeing that in the economic figures.
JOURNALIST: When you say you're leaving it to the Fair Work Commission, the question of wages - you don't think I'm horribly simplifying your position there, but that's actually it right? You're leaving it with an independent arbiter?
JOURNALIST: How then can you promise better wage growth?
CHALMERS: The point that Bill was making during the week is the minimum wage is no longer a living wage, that there's a growing gap between the minimum wage and the average wage in this country, and that has consequences for all of us. Our wages policy has a number of elements. We want to restore penalty rates for weekend work. We want to crack down on sham contracting and the dodgy use of visas, and the dodgy use of labour hire companies to undercut wages and conditions. All of those things together, if we implement them properly, do have the capacity to lift wages growth in this country, which has been at record lows under the Liberals for the last five-and-a-half years.
JOURNALIST: Governments around the world have struggled with multinational tax avoidance. Would an Australian Labor Government (inaudible)?
CHALMERS: We intend to make multinational corporations pay their fair share of tax. When we do, we can invest in the things that we as a society truly value - investing in our schools and hospitals, and cleaner and cheaper energy sources. We do that by making multinationals pay their fair share. We've got policy out there already, by Chris Bowen and Andrew Leigh and others, who've worked on this policy area for a long time. It's a key part of our platform.
JOURNALIST: What's your key message to people who'll be impact by the revocation of franking tax credits who say we're going to get less, we're going to have to go on the pension earlier? You know, we've made our retirement plans, now we're gonna be in our 70s when we're on the pension, we thought we would never have to.
CHALMERS: Our proposed changes impact only about four per cent of the population. They don't impact pensioners. All that we're proposing to do is to go back to the system that existed up until 2000. We intend to give refunds for franking credits only down to a tax liability of zero, but not to send the cheques after that. That's how other countries do it. The way we do it in Australia is more generous than anywhere else in the world, and we have to be responsible about the Budget. And so when people ask me about this, I say that we know that it's not universally supported, but only four per cent of the population will be affected. We need to make sure that we manage the Budget in a responsible way and invest in the things that we value - hospitals and schools, and all of that. That means difficult decisions.
JOURNALIST: So it's essentially, please bear with it because you can wear it?
CHALMERS: We've shown people the respect of announcing our tax policies well in advance of the election, so that they can judge us on then, so that they can question us on it. They've been doing that, and that's a good thing. We didn't want to do what the other mob did, which is to pretend that there'll be no changes and then all of a sudden after the election spring all kinds of things on the Australian people. We've shown people the respect to say well in advance, months out from an election, that this is what we intend to do and this is why we intend to do it.
JOURNALIST: No chance of deeper personal income tax cuts if the Government comes out with something that looks very much like a big juicy carrot to the electorate?
CHALMERS: We've got our tax cuts on the table, as I've said - bigger, fairer tax cuts under Labor for people earning up to $125,000. We're proud of those tax cuts. We've led the way when it comes to low and middle income earners, because that's how we roll in the Labor Party. We look after people on low and middle incomes first. The Liberal Party always looks after the top end of town. If there are additional tax cuts in the Budget in April, not too far from now, then we'll obviously consider them on their merits.