Radio Interview: ABC 774 WITH JON FAINE - Tony Abbott’s unfair Budget; $100,000 degrees; Tony Abbott’s GP tax

13 March 2015






SUBJECT/S: Tony Abbott’s unfair Budget; $100,000 degrees; Tony Abbott’s GP tax; Labor policies; East West Link; Tony Abbott’s broken promises on submarines; Palmer United Party; Marriage equality.


JON FAINE: Bill Shorten is the leader of the Federal Parliamentary Labor Party, is there more too him than just the famous zingers and one liners. Mr Shorten, good morning to you.




FAINE: If you got your hands on the levers people are asking what would do? What does Bill Shorten actually believe in?


SHORTEN: Well the Labor Party believes in lots of things, and it’s a great opportunity this morning to talk about some of them. What I fundamentally believe and I think it was Martin Luther King who said this best, but it's I think true then and it's true now: ‘everybody is somebody’. I believe in an Australia where everybody gets the chance to fulfil their potential. Where we're not a divided society but we’re a united society.


JON FAINE: Okay, well let's leave the clichés and historical motherhood references out. What does it actually mean for the Australian economy, for where we are now, some of the difficult issues that create problems in our society?


SHORTEN: Well, we can leave some of the historical references without, but it is important that I think people understand what Labor stands for and Labor fundamentally believes that this society works best when everyone's included, not just the well-off but those who are more disadvantaged.


FAINE: So let's turn that into policy, let’s look at some of the issues, youth unemployment. Yesterday the figures were startling and underemployment even more startling. Do you believe in protectionism, would you go back to the car industry now it’s gone, what would you go back to, what would you do? Where do you pull those levers?


SHORTEN: Well it's got to be about growth. It’s got to be about how we create wealth and then it’s ensuring we have a fair distribution of income but we’ve got to have an economy that's creating growth. We have a couple of shocks under way in the Australian economy. One is the move from mining, investment in mining to investment in non-mining industries. We also need to make sure that we're a scientific nation, that we're investing in innovation and research. So all of this contributes to the fact that we need to be part of the Asian century, we need to engage with the rise of Asia –


FAINE: So why oppose for instance a health research fund which you did. The Government wanted to create one, you’ve blocked it.


SHORTEN: Jon, you don't pay for future research by taxing people who are currently sick and vulnerable. But going to your key story which you said what's Labor think about the economy, think about the future? In a nutshell, if you can do these matters quickly, we're changing from mining, we're seeing minerals prices going down, the Australian economy has got to invest in alternative areas of growth –


FAINE: Like what?


SHORTEN: Well it has to be in health care, in education, in environmental industries, in engaging with Asia, in services –


FAINE: How do you pay for these things?


SHORTEN: Well, then we get to the area of how do you drive growth full stop. The way we drive growth full stop in my opinion is not shatter the confidence of the Australian economy –


FAINE: You want to put taxes up?


SHORTEN: Jon, the discussion we're going to have a bit longer than one liners and that's what I think you said in your introduction. Can we get beyond the one liners? If we accept that the Australian economy's changing, we've had six or seven years of mining boom and now we don't, if you accept that commodity prices are down, the third shock that Australia’s having is one which we couldn't have predicted. That is, the Government's manufactured a crisis in this country and they've shattered confidence ever since their unfair Budget. So the levers that Labor would pull is we'd invest in our education system, we'd make sure that we had a science-based nation. We wouldn't certainly be holding science and research in this country hostage with threats of cuts as Christopher Pyne's doing unless we vote for their unfair changes to higher education.


FAINE: How do you pay for all of this is the fundamental question and confidence was already down under the government you were a part of, the Labor Government shattered business confidence. Tony Abbott promised to restore it, he hasn't. Just like you're promising to restore it and it didn't work. So what specifically would do you? Because the Government’s got, yes, an expenditure problem but a revenue problem too. So where are the tax increases to pay for all of this going to come from?


SHORTEN: Well again, before I get to the latest question you ask we have to talk about what is happening in Australia. If you get that economy’s changing from mining, if you get that we've got the rise of Asia and we should be trying to benefit from that, if you get that the current government's upset the confidence of the nation, you then look at what are the levers that government can pull and that's the heart of your question. One is we must invest in science and innovation. Two, we must make sure that we've got an education system which is providing lifelong learning from child care, through to schools, through to higher ed and TAFE.


FAINE: You’re at risk of repeating yourself, I’m asking you to explain how you pay for all of these things and the infrastructure that the increasingly growing fast cities desperately need?


SHORTEN: Well you go to the next lever. If education’s one lever that the national government can help pull to make this country grow, because I believe that if you invest in peoples’ minds and let people fulfil their own potential then they will find those economic opportunities that's so necessary to growth but then you to get to infrastructure. We do need more infrastructure in this country. We need a national infrastructure market where people can invest in infrastructure projects in the future with the certainty that infrastructure is not politicised, that the choices and the projects which are being suggested by national governments are ones which stack up in a cost benefit analysis. So there's infrastructure then there's education, then there's proper investment in science. These are economic prescriptions as well as being things which are good for our quality of life.


FAINE: But until they're turned into reality they're slogans so how do you pay for it? Everyone says they want to depoliticise infrastructure. That's just code for saying: I want infrastructure that looks after my backers.


SHORTEN: That's too cynical Jon.


FAINE: What are you proposing to depoliticise infrastructure?


SHORTEN: I think one of the big challenges in infrastructure is getting agreement on what are the projects which are sustainable, what are worth the support of taxpayer dollars? You have an independent Infrastructure Australia. That's something that Labor did set up, the current government has by-passed Infrastructure Australia and we’re back to this debate which, you know, you quite rightly criticise where different partisan interests say we want this or that project.


Get the experts, free them up from day-to-day politics, have a transparent business case which everyone can investigate, everyone can see. If you’ve got a transparent business case then investors will be confident to back in infrastructure and by infrastructure I mean it could be roads, it could be rail. The point about it is that if we're going to have taxpayer support and private investment we’ve got to make sure that our infrastructure is not just done with an eye towards winning a particular electorate in the next election.


FAINE: But in fact if want to, if you're concerned about confidence for infrastructure, tearing up contracts for instance for Melbourne's East-West tunnel is a confidence destroyer, all the overseas investors are saying.


SHORTEN: Your point there I assumes that the cost benefit analysis was independent and transparent and it clearly wasn't. So when we talk about it, that's exactly proof of how to do the process wrong by the last government. What you need to do is to have an infrastructure plan which isn't just a Liberal Premier trying to hang onto office or someone in Labor trying to argue ‘vote for Labor’. What we need is something which is above politics. What Australians want is long-term vision, not short-term political debates.


What I'm doing this morning is saying to people who want to know what Labor stands for, the Commonwealth Government has some levers at its disposal. Proper lifelong investment in education, proper processes for deciding infrastructure. Then you get to the question of health care. Healthcare is not just a social justice, it's not just a safety mechanism policy, it's also something which enhances the productivity of the nation. If you have good primary care, if people aren't discouraged from seeing their GP, if people are able to use universally accessible Medicare that is a more efficient way to promote the health of the nation than having a system which relies you, encourages you to end up going to hospitals or Emergency Departments or more inefficient systems.


FAINE: All of which is easy to talk about. Again, it's very hard to understand exactly how you would propose to pay for better health care, better education. I mean, this is pretty much what Tony Abbott did as well. People are sick of politicians overpromising then under delivering. We're sick of the lack of bi-partnership on what is obviously good nation-building policy. We're sick of some of this tit-for-tat, now I’m in power I’m going to punish the people who came before me. We want to see someone, and whether that’s you or not we’re still wondering, we want to see someone who knows where to take the country.


SHORTEN: Well, Jon you asked about three or four questions/statements there. What I'm doing this morning is I'm explaining to your listeners that the Labor I lead is thinking about the long term. What are the things, what are the policies that the Commonwealth Government, that if Labor was to form a government, would do? And I'm going through one by one –


FAINE: Sure, you can promise everything. Fundamentally again and again and again I’ve asked you many times, how do you pay for it?


SHORTEN: I will come to that, but I’m just –


FAINE: Well why don't you do that now?


SHORTEN: Because you made three points. One is that people don't want tit for tat bipartisanship, they just don't want to hear what you would say are promises. They want to know detail. What I'm doing here is articulating what Labor stands for because I think at the start of the show that's what you were saying, what does Labor stand for? If we get to the issue of bipartisanship, it is frustrating dealing with the Abbott Government in terms of bipartisanship. Because -


FAINE: They didn't start the tit for tat, your people started, it goes back as far as anyone can remember.


SHORTEN: Let's talk straight here. This government's Budget last year, you know, on one hand people say you should be bipartisan, on the other hand look at the measures they're bringing in, $100,000 degrees, cutting the pension, you know, a tax on the sick. How can you be bipartisan about rotten ideas? Now there are issues that we are prepared to be bipartisan on, national security.


FAINE: NDIS is the only one that comes to mind in recent times.


SHORTEN: There’s the Disability Insurance Scheme, but there's also national security. If you look at their legislation, they've presented legislation to the Parliament on a number of times. We've modified and improved it and then we’ve be able to vote for it. We've offered bipartisanship in terms of constitutional recognition of Indigenous Australians. Two weeks ago, we announced that we believe there should be a national political push in terms of tackling family violence and the Prime Minister's agreed to meet with me to talk about how we can implement that. So on constitutional recognition, we're up for bipartisanship. On national security our record's there, the National Disability Insurance Scheme. When we talk about renewable energy, we think the Government's trashing it, but we are prepared to again keep sitting down with the Government to rescue renewable energy in this country. So there’s a range of bipartisanship. It doesn't sell newspapers like conflict –


FAINE: Okay, lets get into tax issues, where are the tax increases going to come from?


SHORTEN: Well first of all the government said that they're going to have a federation tax White Paper. We want to see what they're going to say there and we're prepared to be open minded and see what ideas they come up with.


FAINE: Are you going to end some of what are called middle class welfare or concessions to superannuation, negative gearing and the like?


SHORTEN: You have three questions there. Let's take each in order. In terms of what you would call middleclass welfare, when it comes to a better targeted means testing in terms of family payments, Labor did that in government. And we've also voted for some of the changes that the government has sought to make when we've been in Opposition. Again it doesn't get the sort of coverage in the media that perhaps we think it should but we voted for some of the government changes. We've supported a range of their changes which we think are sustainable and not unfair and not broken election promises. So we do support better targeting and means testing. Then you also raise various tax concessions and various matters -


FAINE: There's billions and billions of gap between expenditure and revenue, and we’re told not just the Intergenerational Report that Joe Hockey, Malcolm Turnbull and Tony Abbott, they’re all saying we’ve got a problem and no one is addressing it.


SHORTEN: Well first of all, Labor did vote when we were last in Government to make significant changes to the structural spending of the Budget and again in Opposition we have voted for legislation that the Government’s put forward. Some of the stuff though that they put forward as I said, we can’t vote for because it was broken election promises and they’re making the burden of change fall upon the least well off in our society -


FAINE: But you’re making the gap bigger by doing that.


SHORTEN: Then you went to the issue of superannuation tax concessions for instance, Labor does have a view that once people have a certain amount in their superannuation, and I’m talking about large amounts that some of the income they earn from it once it passes, you know, into 6 figures they don’t need a further tax concession. So we’ve been up for that discussion with the Government, they’re not interested in that. We put forward proposals -


FAINE: Last time Wayne Swan tried that when he was Treasurer there was a rebellion against it and the Labor Party lost its nerve.


SHORTEN: No we still have policies about some of the very high end superannuation tax concessions.


FAINE: Tax the rich?


SHORTEN: Oh no John, if we’re to have a good debate in this country I cannot, and I’m not that sort of person just to use the three word slogans like ‘tax the rich’ or indeed the Abbott Government says you know ‘tax the poor.  The truth of the matter is that we need to encourage people to save for their retirement. People are sick of frequent changes in superannuation policy and I refer to Joe Hockey’s latest thought bubble about that.  But when it comes to tax concessions for the very, very wealthy, I do not believe that the taxpayer needs to help people move from their third million to their fifth million in their superannuation account with a concession. And we also -


FAINE: Ok that’s not going to solve the problems of the budget though, is it?


SHORTEN: What I’m trying to do is each question you ask I’m trying to answer it straight and you also then said what are you going to do about revenue and you said a litter earlier on in our chat, you know what are you saying about revenue; we believe there’s more that can be done to close down legal loopholes available to multinationals.


FAINE: Ok that might bring you a couple of million, it’s not going to solve the problem. What about negative gearing which is the biggest, 40 per cent of applications to Australian banks now are for investors and they are, in fact Australia is probably the only country in the world now where the government helps you more to buy your second subsequent house than your first one.


SHORTEN: Well first of all again I’ll come to housing in a moment, but when we talk about revenue because that was one the question you were asking a couple back. We’re saying we do have views and we announced our policies on cracking down on legal loopholes for multinationals where companies are able to shift large amounts of debt into their Australian operations to ride off tax here and the debt profile of that company in Australia is far greater than their average across the world and we think that’s a loophole which needs tackling.


In terms of housing affordability, there is a challenge around housing affordability and your point is that, is a tax concession the best way to tackle housing? I think one of the big challenges in housing affordability is the supply of land. If you have more housing on the market then that puts downward pressure on the price of houses.  We do think housing affordability is an issue, but we also want to keep talking about what we’ve already proposed. In politics it’s very easy every day to move onto another topic, we’re determined to keep talking to Australians about how we make multinationals pay their fair share and we don’t think all Australians are aware of our views on that yet, and we don’t think that all of the discussion has yet been exhausted. And when you say that would save the Government and the taxpayer a couple of billion dollars, I think that is a good start, I think that is important.


FAINE: Yes or no, would you grandfather or in some way wind back negative gearing?


SHORTEN: That policy is not on our radar.


FAINE: Why not?


SHORTEN: Well because we that we’ve got to keep talking about multinational taxation, we think that –


FAINE: Drop in the ocean compared.


SHORTEN: Jon I don’t share your view that a couple of billion dollars is a drop in the ocean, and we can’t afford –


FAINE: No but negative gearing costs the budget tens of billions of dollars.


SHORTEN: We can’t afford to become blasé about those matters and just dismiss our, the integrity of our national tax system, in terms of how some multinationals are able to forum shop to get the best taxation deal.


FAINE: So you agree with the problem that negative gearing is a problem to the budget, but it’s just too big now is it, to ever be wound back, it’s just out of control to the point where so many people are beneficiaries of it, it’s electorally poisonous to touch it?


SHORTEN: No I’m saying that I think that the issue is housing affordability and what are the drivers of housing affordability, what makes it harder for people to get into the housing market, how do we stimulate more housing?


FAINE: Well people, people who are at my stage of life, who are competing against first home buyers but their investors who are bidding at auctions against first home buyers and young families. That’s what’s creating the problem, it’s as plain as the somewhat large nose on my face.


SHORTEN: Well I will be interested to see if in the Federation White Paper and the taxation proposals that the government are looking at if they go to the points you make. But on the points you’ve raised this morning in terms of taxation, one we are for cracking down in terms of multinationals paying their fair share. Two, we think that superannuation tax concessions at the very top end, the policy of giving people tax concessions becomes a bit irrelevant once you’ve got a couple of millions of dollars already, you don’t need taxpayer assistance any further. And in terms of housing affordability, I believe the best thing we can do for that is look at how do we improve housing affordability and that’s the question we’ve got to answer.


FAINE: If Daniel Andrews can tear up a contract for the East West tunnel, can Bill Shorten tear up a contract with Japan for defence contracts and submarines and say, hang on, we didn’t have a transparent process, we didn’t have full accountability and no we’re not going to be bound by a previous government commitment?


SHORTEN: Whilst I think the East West contracts stand on their own, Daniel Andrews was very clear at the last state election with that he said, in terms of the contracts for submarines, I’m not aware that the Federal Government’s signed any.


FAINE: No they haven’t but if they were too and it looks like they’re going too would you regard yourself as bound by it or not?


SHORTEN: We’re very conscious that if there’s properly enforceable legal contracts in place for billions of dollars of defence equipment that’s a pretty serious matter and we’re not into creating all of that uncertainty with our defence contracts. But I would say to people, I do not believe that the Federal Government has signed any contracts although I’m deeply suspicious that the Abbott Government went a long way down to doing a deal without transparency in terms of tens of billions of dollars of defence equipment which is fundamental to our security and there was an election promise to build those subs in Australia. So I think, if you forgive the pun, there’s a lot more water to go under the bridge before we get to the question you’re raising and I’d like the Abbott Government to come clean on whether they have done a deal, have they committed Australia over four decades to tens of billions of dollars, have they broken an election promise? So I think that there isn’t a contract but I am suspicious about how much the Government might have already done.


FAINE: Would you legislate for gay marriage in Australia?

SHORTEN: I do support marriage equality. I think what we need is a conscience vote in the Parliament, Labor has a conscience vote –


FAINE: Would you introduce it?


SHORTEN: I would like to get the Liberal Party to commit to a conscience vote because then it would have a prospect of success.


FAINE: Tony Abbott has committed to a conscience vote but no one’s bringing the legislation to the Parliament.


SHORTEN: I don’t think the Liberal Party’s committed to a conscience vote.


FAINE: He’s said he doesn’t think it should be party policy to tell people how to vote on matters of conscience.


SHORTEN: Tony Abbott and promises are a bit like oil and water. We would have a debate in the parliament, so the answers yes, but there’s no point in doing that if the Liberal Party’s just going to bind everyone.


FAINE: Has the Palmer Party bubble burst?


SHORTEN: There certainly seems trouble at the Palmer mill here doesn’t there. I deal with Glenn Lazarus and Dio Wang, there senators, the Palmer affiliated senators. Their people of conscience, I don’t know what’s happened there, we’re going to deal with the senators on the issues rather than necessarily every twist and turn of the Clive Palmer show.


FAINE: But has the Clive Palmer attempt to influence Australian politics, is that era over?


SHORTEN: Well Clive Palmer’s still in Parliament, I think anyone who counts him out is premature but what we want is for the senate to support good laws and a better future for Australia so we will keep lobbying on matters such as preventing Christopher’s Pyne’s unfair attack on higher education. I think it’s really wrong of the Liberals in the last 24 hours to take science and research funding hostage in Australia and say they’ll cut that unless people agree to their $100,000 degrees and deregulation which will lead to fewer students paying more prices to go to university.


FAINE: Well if the audience have got what they wanted, I guess we’ll find out when we get talkback. I’m making you late for your next commitment for which I apologise but thank you for coming in this morning for the first time since last May so it’s been a long time between visits to the 774 ABC Melbourne studio, thank you for coming in.


SHORTEN: Thank you Jon, and again I just say to people Labor is working through its policies. You said earlier on a question, you know, when will we see if these are promises versus action, for goodness sake I just Tony Abbott would call an election because when it comes to doing the right thing then we can get into the debate about the future. At the moment this government in my opinion, is just too much focused on itself and not enough on the future, so thanks Jon.


FAINE: We will see, no thank you for your time, Bill Shorten, the Leader of the Opposition in Federal Parliament.