2019 election; Jobs pledge; Budget management; Financial Services Royal Commission; Resignations.
LEIGH SALES: Prime Minister welcome to 7.30 for 2019.
PRIME MINISTER: Great to be back Leigh.
LEIGH SALES: The Coalition has been in an election losing position in the polls for virtually its entire term. You have members of your frontbench choosing not to contest the election, high profile independents are running in key Liberal seats, cashed up groups like GetUp! are targeting you in vital marginal seats, all this against the recent backdrop of Coalition disunity and instability.
Is the kind of talk you’re engaging in today of re-election and ten year plans wishful thinking?
PRIME MINISTER: No, Leigh, I mean, just as well I’m a fighter when you listen to what you’ve just relayed out there which is I think is a particularly pessimistic way to look at things. I’m not looking at things like that at all.
What I’ve announced today is that we’ve got a goal, a pledge in fact of one and a quarter million new jobs and that’s not a vague promise because we’ve already delivered 1.2 million jobs as a government since we were first elected so that’s what I’m focussed on; a stronger economy to guarantee the essentials that Australians rely on.
That’s our record as a government, a good strong policy record and a clear plan that I announced today to take us into the future. Not a future with higher taxes but a future of a stronger economy which Australians need.
LEIGH SALES: When you’re talking about, as you say 1.25 million jobs, also income tax cuts, more spending on health and education, return to surplus, a ten year plan to eliminate debt. For you to achieve all of that you have to assume a continual best case scenario on lots of economic external factors instead of a pragmatic one. That is the definition of wishful thinking.
PRIME MINISTER: No that’s actually not true, Leigh, I mean doing what we’ve pledged today on jobs would actually not be at the peak rate of jobs growth that we’ve achieved over the last couple of years so I think that-
LEIGH SALES: But it’s the environment with all those other factors-
PRIME MINISTER: No, no not at all, Leigh. One of the marks of our economic management is that we’ve always exceeded expectations. One of the reasons that as Treasurer I was able to ensure that we maintained our AAA credit rating is I said we would hit a surplus in 2021, well we’re going to hit it in 19/20.
I have a track record of under promising and over delivering whether it’s on the economy, border protection, welfare reforms Leigh. My record, our government’s record is delivering and today we’ve set out new plans to deliver in the future for the stronger economy which enables us to list lung care medicines and get meningococcal vaccines to young Australians.
LEIGH SALES: On this point though that you’ve exceeded, that your government has exceeded expectations the Coalition record, doesn’t that pitch simply confuse voters along the lines of ‘well, hang on if your record is so good why did you need to dump Malcolm Turnbull?’
PRIME MINISTER: Well that was last year, Leigh, and what we’re focussed on is the plan we’re taking to the next election. It’s a plan based on our policy successes as a-
LEIGH SALES: [inaudible]
PRIME MINISTER: …government over the last five, I know your point is-
LEIGH SALES: My point is that-
PRIME MINISTER: Your point is about politics-
LEIGH SALES: [inaudible] aren’t you confusing, no aren’t you confusing voters? You’re saying our record is so fantastic, we’ve exceeded expectations it’s confusing to people, they just saw a Prime Minister get dumped a matter of months ago.
PRIME MINISTER: My break over the summer involved talking to people who were sharing with me about their need for having their job secure, being able to get home in time to spend time with their families which is why today I announced another $240 million going into urban congestion busting projects here in South East Queensland and that’s what we’re focussed on; the things that actually improve people’s lives. We’ve got a great track record of delivering on infrastructure because people can see the earth machine, moving machinery on sites now.
We’ve got a great record on tax cuts because we’ve passed that through the Parliament with legislation. We’ve got a great track record on bringing the budget back to surplus because we will have the first surplus achieved by a government in 12 years when Josh brings that down on the 2nd April this year.
So that’s our policy record. What you’re talking about is politics. That’s a different thing.
LEIGH SALES: On policy you also have a plan you were discussing today, a ten year plan to wipe out debt, but that would mean for that plan to reach fruition the Coalition would be re-elected three times, there would be no external shocks. What do you say to the suggestion that that’s a plan at best based on rose coloured glasses and at worst a fantasy?
PRIME MINISTER: No what I said today is my goal is to see that debt gone, net debt gone by 2030. Now the decisions that made in the next three years in the budget will determine what happens with that budget over the next ten years. How do I know that? When Labor last came in 2007 the decisions they took in their first term actually led to the debt position we are in today.
So no it’s not fantasy, it’s fair dinkum. The decisions that are taken and in the next budget, the budget after that, the budget after that will determine the debt trajectory of our nation and the tax trajectory-
LEIGH SALES: Sorry, just while you’re on debt, you’ve been in office now for six years, you point out that Labor had a debt problem. Net debt at the end of their term in office was $202 billion, net debt today is $341 billion, you’ve taken it in the wrong direction.
PRIME MINISTER: Well because we’ve had to wind back the deficits of Labor and get the budget back into balance. You can’t reduce debt, Leigh, if you’re still running deficits. And so we’ve had to take down, from the record deficits of Labor, to bring the budget back into a surplus position for the next financial year. Now you can’t pay down debt until you get back into surplus and it has taken us the last five and a half years to wind back the baked in spending excesses of the Labor Party, to get the budget under control, and now we’ve turned the corner on debt and if we keep making those decisions that’s why my goal is you keep making those decisions and you will wipe out debt within 10 years. If you go down Labor’s path, you won’t.
LEIGH SALES: While we’re on Labor, you’ve said repeatedly today that the Australian economy will be weaker under a Labor government because it will impose higher taxes.
PRIME MINISTER: Correct.
LEIGH SALES: Where’s your evidence that higher taxes weaken an economy?
PRIME MINISTER: Well I think it’s just fundamental economics 101, Leigh.
LEIGH SALES: But the Howard Government imposed a very big new tax on Australia, the GST, are you saying they weakened the economy?
PRIME MINISTER: No, they abolished taxes at the same time, Leigh. They actually lessened the overall individual tax burden on Australians. That’s why I don’t want to see, and I’ve legislated it at this end, in 94 per cent of cases, more than 32.5 cents in the dollar in tax. I’ve already cut taxes for small business. Today, I announced we’re cutting taxes further for small business by increasing the instant asset write off to $25,000 and that’s over $750 million worth of small businesses’ own money that they get to keep.
Lower taxes have been a key part of our economic plan that has generated record jobs growth, 1.2 million. The strongest growth in a year for young people, for people over 55, for women, right across the board, getting people off welfare and into work and a key part of our economic plan has been lower taxes. Labor wants to put a sheet anchor on the economy in $200 billion in higher taxes.
LEIGH SALES: But by your logic, if higher taxes in and of themselves generally weaken an economy, a country like Norway should be weak but it has some of the highest taxes in the world and yet the average Norwegian is richer and has a higher standard of living than the average Australian.
PRIME MINISTER: Australia has had 27 years of continuous economic growth. We are at the top of the leader pack when it comes to advanced developed economies in the world for economic growth, the world is looking to us in terms of how we’ve been able to succeed and how we’ve been able to succeed as a government is by keeping taxes low, backing small business, investing in infrastructure so people can get home on time and tradies can spend more time on the time and not in a traffic jam, expanding our export markets, defence industry procurement plans. I mean, this is how we’ve been growing the economy and the plan I announced today builds on that success.
LEIGH SALES: On the 1.25 million jobs that you’re promising if re-elected, of those how many will be filled by migrants?
PRIME MINISTER: Well migrants form part of the overall population flows into the country, we don’t have a breakdown of that, Leigh.
LEIGH SALES: Of the million jobs you’ve created how many have been filled by migrants?
PRIME MINISTER: I don’t have those figures to hand, Leigh. What I do know is that population growth has not run as high as jobs growth. So that means jobs growth has been at a higher rate than population growth and has been running at a higher rate than migration growth.
LEIGH SALES: Would it surprise you that half of the million jobs you’ve created were filled by migrants?
PRIME MINISTER: What I’m saying, Leigh, is that all Australians who are living here are getting more jobs today than they were before. When we came to office, the rate of jobs growth in Australia under Labor was 0.2 per cent, today, it’s 2.2 per cent. It’s 11 times higher. We inherited a basket case of a jobs program under the Labor Party and we’ve turned it into one of the biggest jobs generating governments in the history of the country.
LEIGH SALES: Let’s quickly run through some other issues before we run out of time. The Banking Royal Commission, does your government commit to implementing all of Commissioner Hayne’s recommendations?
PRIME MINISTER: Well in principle this is what our intention would be, but we’ve obviously got to see a report before we make a decision on that and that’s why the Treasurer has announced today that in a very measured process, over the weekend, once we receive that report which will be in the middle of a market day so you wouldn’t go and release it while the markets were open, the government will consider that over the weekend and provide an interim and initial, if not final, response on the Monday after the lockup after markets close. Now that’s important to ensure that there’s stability in the financial system, you don’t go shocking financial markets, you take your time on this. But I think that is a reasonable timeframe to ensure the Royal Commission report is released in a timely way and done so in a way which maximises stability for the financial system.
LEIGH SALES: We’ve seen evidence in those hearings of banks effectively stealing from customers, for example charging people for financial advice that they never intended to provide, would you expect criminal charges to flow from the Royal Commission?
PRIME MINISTER: I’m going to wait to see what he recommends, I’m not going to speculate on it. But I want to commend Commissioner Hayne for the outstanding job he has done. He has kept it in the time frame, he has got it done. He has also been very mindful, I think, of the impact of this Royal Commission on the financial system, and I think he’s been very careful not to exacerbate problems, particularly around credit restrictions. Now we have seen a fair bit of that happening. That has been impacting on the economy. So it’s important we ensure stability on how we respond to this report, and making sure the economy can continue to kick along without any unnecessary shocks.
LEIGH SALES: Three of your ministers, as I mentioned earlier, have said that they won’t recontest the federal election. You’ve said today that it’s offensive that their stated personal reasons for leaving are twisted into politics, for a political motivation.
PRIME MINISTER: It is actually.
LEIGH SALES: Perception is everything in politics, and three ministers quitting gives voters the perception of rats deserting a sinking ship.
PRIME MINISTER: Well who is creating that perception? The Labor Party have.
LEIGH SALES: Well haven’t three ministers in a row by saying they… [inaudible]
PRIME MINISTER: No they haven’t, because they have made very clear their personal reasons for doing that. Just like Gai Brodtmann did, just like Kate Ellis did, just like Jenny Macklin did, just like Wayne Swan did, just like Jacinta Collins has done, and what I find upsetting is, you know me Leigh, I’m for family values and when people raise issues like miscarriages with me, I’m not going to be so insensitive as to not understand fully the reasons for that decision. I think it’s pretty disappointing that Bill Shorten would cast a slur on Liberal members for genuine family reasons for leaving, but when it comes to Labor members it’s ok, I think this shows a failing of character, he should have just wished us well. He should have just wished Kelly O’Dwyer well. It’s ok for Tim Hammond, a bloke from Western Australia to say he is not going to stay one term of parliament, but for Kelly, who has served the parliament for almost 10 years, for her to leave because of quite personal reasons, particularly relating to issues that I’m sure all Australians would want to wish her well, I just find frankly quite disappointing.
LEIGH SALES: Just quickly, if the Coalition loses the election do you commit to staying on as leader of the party and therefore opposition leader?
PRIME MINISTER: I’m committed to winning the next election, and in the Liberal Party…
LEIGH SALES: If you lose though? As you said before it is a tough job.
PRIME MINISTER: It’s a tough job. That’s not my plan. Australia can’t afford Bill Shorten as a Prime Minister so I’ve got every energy flying into that and the leadership of the Liberal Party is always the gift of the parliamentary Liberal Party and I never make any presumptions upon it.
LEIGH SALES: And just finally on this programme recently Mr Shorten committed to doing two prime time interviews with 7.30 during the election campaign, would you be prepared to commit to the same?
PRIME MINISTER: We’ll go through the normal process of setting those Leigh, I’ve always been very available to 7.30 and always enjoy our friendly chats.
LEIGH SALES: Well in that vein I look forward to seeing you twice in the election campaign, thank you very much.
PRIME MINISTER: Good on you Leigh. Good to talk to you.