Senator the Hon Mathias Cormann
Minister for Finance
Date: Saturday, 6 June 2015
MATHIAS CORMANN: We welcome Labor’s decision to finally support one of their last Budget measures. The decision to reverse the second round of income tax cuts linked to the carbon tax was a decision in Labor’s last Budget, the 2013-14 Budget. This now means that instead of a $59 billion Budget black hole, Labor’s Budget black hole is $3 billion less, about $56 billion.There is of course still a way to go. We call on Bill Shorten and Chris Bowen not to stop here. Keep looking at the measures that we have put forward to repair the Budget mess that you left behind. In particular, consider the other $3.6 billion worth of measures that you initiated and banked in your last Budget to repair the Budget. Happy to take questions.
QUESTION: Why do you think Labor, why do you think they changed their minds and reverse it?
MATHIAS CORMANN: It became very clear that Labor confronted a $59 billion Budget black hole. Under Labor, the Budget position over the forward estimates would have been $59 billion worse. Given Labor made the decision back in 2013 to initiate this particular measure to repair the Budget, they finally came to their senses. We welcome that.
QUESTION: Hasn’t the Government only increased the Budget deficit, even in the past year?
MATHIAS CORMANN: No we haven’t. Under this Government the Budget is now on the right track. The Budget position is now improving. We are now on a believable pathway back to surplus. What we had to deal with over the last year is significant revenue write downs. Since we came into Government the revenue is now $92 billion less than expected over the forward estimates as a result of things like a sharp fall in the price of iron ore. That would have happened irrespective of who is in Government. But what we have done, we have made the decision to get spending growth under control. We have made the decisions to reduce spending as a share of the economy over the forward estimates. The deficit is now reducing year on year and the Budget is now on a credible path back to surplus.
QUESTION: This decision to reverse it do you have an estimate of how many people it is likely to effect, potentially?
MATHIAS CORMANN: What this does, it will improve the Budget bottom line by about $2.8 billion over the forward estimates. The effect on taxpayers across Australia ranges between less than a dollar a week to less than two dollars a week. There are about ten million taxpaying Australians and the impact on them is between less than a dollar and less than two dollars a week.
QUESTION: But what specifically about low income earners?
MATHIAS CORMANN: As I say, the worst effect on anyone across Australia is less than two dollars a week. This is a measure that Labor initiated and banked in their last Budget. They said at the time that they would not revisit these tax cuts until the carbon tax reached $25.40 a tonne. We have abolished the carbon tax all together, so it will never ever under our Government get to $25.40 a tonne. It will be $0 a tonne. So people across Australia are better off, because we got rid of the carbon tax and we kept in place the first round of income tax cuts. But this second round of income tax cuts, which was always linked to Labor’s carbon tax, is not proceeding. That has a very small impact on individual Australians, but it helps us with our job to strengthen growth, create more jobs and get the Budget back under control.
QUESTION: As small as it may have been what about the people that have factored this in?
MATHIAS CORMANN: In the context of strengthening growth, creating more jobs and getting the Budget back under control you have to make choices. The Government is getting on with the job of doing what we said we would do. What we said very clearly in the lead up to the last election is that we supported this measure of the Labor party in their last Budget and that we would seek to legislate this measure of the Labor party in their last Budget. That is what we are doing and we welcome the fact that, finally, Labor has decided to support their own Budget measure.
QUESTION: Chris Bowen in his comments has suggested that Labor really didn’t have a choice because the deficit has plunged to such a dire low. Can you really seriously sheet that all the way back to Labor?
MATHIAS CORMANN: The Budget is in a much stronger position now than it would have been if Labor had stayed in Government. The decisions that we have made have put Australia on a stronger trajectory for the future. We are now on a stronger growth trajectory, more jobs are being created and the Budget position is now improving. We are now on a trajectory back to surplus. We are now on a trajectory where the deficit is reducing year on year and we are projected to get back into surplus by 2019-20.
QUESTION: On other matters Minister, is the Government any closer to finding out who leaked the details of the Cabinet meeting a few weeks ago?
MATHIAS CORMANN: Enough has been said about all this. I’ve got nothing to add.
QUESTION: And Julie Bishop has warned that Islamic State terrorists are recruiting scientists to manufacture chemical weapons. Can you tell us what evidence the Government has that this has happened?
MATHIAS CORMANN: We are very concerned about what is happening with the Dae’sh death cult. The threat from global terrorist groups like Dae’sh is the most significant national security threat that we are facing as a nation right now. That is why we are working so hard with other countries around the world to fight and defeat ultimately the Dae’sh death cult. It would be absolutely terrible if Dae’sh was able to get hold of chemical, biological or even worse nuclear weapons. We have just got to, countries around the world that are as committed as we are to defeating this threat have got to continue to work together to make sure this doesn’t happen.
QUESTION: Should Australians be worried about it?
MATHIAS CORMANN: The Government is very focused on doing everything we can to ensure Australians are safe and secure. This is our most significant national security threat right now. It is something that we are working to get on top off with countries around the world. We just got to keep doing what we’re doing.
QUESTION: The Foreign Minister has said that terror groups have already used chlorine in an attack. Can you tell us anything more about that?
MATHIAS CORMANN: The Foreign Minister is the appropriate Minister to go into all of the detail here. But let me just say, as a Government, we are very concerned about the threat from the Dae’sh death cult. We are making decisions that need to be made in order to get on top of that threat. We are making the decisions that need to be made to ensure that our nation is safe and secure. In particular, that involves working with like minded countries around the world to defeat that threat, including by making sure that they don’t get the capacity to use chemical, biological and even nuclear weapons.
QUESTION: Do you think the President of the Human Rights Commission, Jillian Triggs is right in her criticism of the crackdown when she says it’s a growing threat to democracy. Are you concerned that the Government would be undermining fundamental rights?
MATHIAS CORMANN: No, she is wrong, as she is in relation to so many other things. The Government is focussed on making sure that our nation is safe and secure. We are facing a very significant threat to our national security and what the Government is doing is to give ourselves the tools to defeat that threat wherever we can. To take away the Australian citizenship from dual citizen Australians who are involved in acts of terror against Australia is an appropriate and measured approach to this threat as part of an overall plan.
QUESTION: Minister, can I just ask about the tax cut reversal?
How confident are you that the legislation will pass through both Houses by July 1?
MATHIAS CORMANN: If the Labor party and the Coalition work together to facilitate passage through the Parliament it will pass. Given that Labor has now indicated that they will support their own Budget measure from their own last Budget in 2013, there is nothing standing in the way for this to pass very quickly.
QUESTION: Just back on the citizenship issue, lawyers warned the Government will be entering a constitutional minefield by giving the Immigration Minister the power to revoke citizenship. Are you comfortable with giving the Minister that kind of power?
MATHIAS CORMANN: There is actually a precedent for this arrangement around the world. In the United Kingdom they have had this in place for some time. The relevant minister in the United Kingdom has been able to make these decisions all the way back since 2006. This, in a modern world, is an important tool as part of our efforts against national security threats like the threats we are facing from the Dae’sh death cult. There is already a provision in our law where those Australian citizens who are getting involved in acts of war against Australia can be stripped of their citizenship. This modernises the relevant provision to ensure that people who are getting involved in acts of terror against Australia, they can similarly be stripped of their Australian citizenship. If somebody gets involved in acts of terror against Australia and they have dual citizenship, they clearly don’t want to be part of Team Australia and that should be reflected by the opportunity for the Minister for Immigration to make relevant decisions in relation to that citizenship.
QUESTION: But terrorism is regarded as a sort of global issue if this is the path we go down, aren’t we passing this problem onto another country? We are not really dealing with the threat when we’re not dealing with these people in Australia.
MATHIAS CORMANN: We are making decisions about Australia’s national security interests. If somebody is a dual citizen and gets involved in acts of terror against Australia, then there ought to be consequences. In those circumstances, we believe that the Minister for Immigration should have the power to revoke citizenship. Incidentally that decision is a decision that would be subject to judicial review if and as appropriate.
QUESTION: Minister, that judicial review would only be administrative and would not check the merits of the case. Are you satisfied with that?
MATHIAS CORMANN: I am satisfied, because I absolutely support the decision that the Government has put forward.
QUESTION: Just on Jillian Triggs’ comments have you heard them, she says counter terrorism would put unseemly haste to plans to strip citizenship from foreign fighters, says executive powers have gone too far. What do you think of those comments?
MATHIAS CORMANN: We disagree with Jillian Triggs. We have considered, in the current environment, the appropriate measures to ensure Australia is safe and secure. We have made the decision that this is an important tool as part of the overall tool set available to the Government to help keep our nation safe and secure.
QUESTION: Thanks Minister.
MATHIAS CORMANN: Thanks very much.