Senator the Hon Mathias Cormann
Minister for Finance
Deputy Leader of the Government in the Senate
Senator for Western Australia
Date: Wednesday, 24 August 2016
LAURA JAYES: So will the Government go for any offers on the table from Bill Shorten and from Labor. It doesn’t seem likely, but the issue of not back-dating the lifetime cap to 2007, well that is something the Government hasn’t ruled out. And surely, the backbenchers concerned about it on the Liberal side might want to think more seriously about this measure. I spoke to the Finance Minister Mathias Cormann, this is what he had to say.
MATHIAS CORMANN: Bill Shorten today was going for the cash grab, whereas we are focussed on reforming the superannuation tax arrangements, making them fairer, more sustainable and fit for purpose. You have to remember, superannuation tax concessions are there to incentivise people to save, to generate an income in retirement which replaces or supplements the age pension. These concessions were never designed to facilitate tax effective wealth accumulation or estate planning. What Bill Shorten did today, by announcing that he would oppose measures in our package such as the opportunity for women or carers or other people with low superannuation balances and disrupted work patterns perhaps to play catch up and make additional contributions, play catch up in the context of concessional contributions that they haven’t been able to make in the past - he said that he would oppose that. He has opposed a whole range of measures that were designed to actually support low and middle income earners in particular, to improve their retirement income arrangements. What Bill Shorten did today was just go for what he always does, go for the lazy cash grab at the expense of people saving for their retirement, instead of looking at how the system overall can be made fairer, more sustainable and indeed, fit for purpose.
LAURA JAYES: But looking at the high income super contribution, lowering the threshold to $200,000 would actually raise about $740 million a year. The Government already lowered that from $300,000 to $250,000. So it is the same principal, why not consider it?
MATHIAS CORMANN: He is proposing to double tax for about another 300,000 Australians. We went to the election with a plan to make superannuation concessions fairer and more sustainable. We have calibrated that plan very carefully. We are now focussed on implementing the plan that we took to the last election. It will be up to Bill Shorten to decide when the legislation comes before the Parliament how he is going to vote for it.
LAURA JAYES: Malcolm Turnbull has said that the Government is willing to reach across the aisle in the 45th Parliament on some issues. In the interests of Budget repair, we have a $38 billion deficit and it is climbing. So what issues is the Government willing to compromise on? Negative gearing? The baby bonus? Can you list any?
MATHIAS CORMANN: Firstly, the Budget deficit is not climbing. The Budget deficit is projected to reduce year on year both in dollar terms and as a share of GDP. That is number one. Number two, what we have said over this past week is that the first thing we should do is implement swiftly the savings that we all agree on. Bill Shorten went to the election identifying a whole series of savings that he had previously opposed, which he said during the election campaign he did now support and which he banked as part of his pre-election costings. So what we are saying to Bill Shorten, no need to have further conversations or negotiations in relation to those, just come out and say clearly and simply, in black and white, that you agree that you will, and that the Labor Party will, vote in favour of those savings. I listened very carefully to Bill Shorten, to his address and the answers to various questions in relation to this today and he wasn’t able to give a straight answer. He was still there, wibbling and wobbling... interrupted
LAURA JAYES: No he wasn’t, but he seems to be indicating that Labor. Sorry, wibbling and wobbling like jelly on a plate?
MATHIAS CORMANN: He was still there, there was more wibble and wobble, and more wibble and more wobble. He still is not giving the Australian people a straight answer. Initially he opposed the savings, then during the election campaign he realised that he couldn’t afford the promises he was making and decided that he would support them. He banked those savings in his pre-election costings. He should come out and speak in straight language to the Australian people and confirm that when the Parliament resumes that he and the Labor Party will support those savings as he said he would do, when he went to the last election.
LAURA JAYES: That’s the easy part, that $6.5 billion in saving. Nothing to sneeze at, but what about other savings that need to be made, other compromises? Would you rule out negative gearing and looking at the baby bonus? Is there anything else the Government is willing to compromise on, reach across the aisle on?
MATHIAS CORMANN: Negative gearing, Labor’s proposed changes to negative gearing is not a saving, that is a tax increase. It is a tax increase that we explicitly ruled out in the lead-up to the last election. We fought the election on our alternative agendas. The Coalition won the election. Labor lost the election. It is now up to the Coalition to implement our agenda for the economy, our agenda for stronger growth. We will not be pursuing tax increases which are bad for investment, bad for growth and bad for jobs…interrupted
LAURA JAYES: But there is nothing that comes to mind that you would be willing to reach across the aisle on?
MATHIAS CORMANN: Well I was about to get to it. We are not going to be supporting Labor tax increases, which were rejected by the Australian people at the last election, which would be bad for investment, bad for jobs and bad for the economy. However, if and when, and where Labor suggest genuine spending reductions to help support the Budget repair effort, of course we will consider those. Of course we consider any genuine and legitimate proposal to reduce spending in a sensible fashion. Of course we would. But, sadly again today what we got from Bill Shorten was overwhelmingly proposals to increase taxes, not a lot of genuine... interrupted
LAURA JAYES: What about the Baby Bonus? Would you reconsider the Baby Bonus, or is that locked in with your Coalition partners the Nationals?
MATHIAS CORMANN: We took a Budget to the last election. The Budget represents our plan for the economy, our plan for families. It represents the agenda that we intend to legislate in this Parliament, starting with tax cuts for hard working families across Australia, alongside restoring the Australian Building and Construction Commission and our plan to make business taxes more competitive again.
LAURA JAYES: Just finally, on the same sex marriage plebiscite, the numbers just don’t seem to be there in Parliament to get this plebiscite up at the moment. In the Government’s view, is it a plebiscite or nothing?
MATHIAS CORMANN: Again, don’t make any assumptions. We haven’t even had the debate in the Parliament yet. We were very clear going into the election. We are committed to giving the Australian people the voice to make this decision. This is an issue that has come before the Parliament on a number of occasions. On each occasion the Parliament has reconfirmed the definition of marriage as being between a man and a woman. Now, we decided, the Coalition decided and we went to the election with a promise that we would conduct a plebiscite, that we would put this before the Australian people for the Australian people to resolve. That is what we intend to do.
LAURA JAYES: So if there is no plebiscite though, you will not pursue same sex marriage via a parliamentary vote of Members? It’s a plebiscite or nothing?
MATHIAS CORMANN: I don’t accept the premise of the question. I don’t accept that there will be no plebiscite. We are committed to the plebiscite and our message to the Labor Party and to anyone in the Parliament is, the Australian people voted in favour of our agenda to have a plebiscite in relation to this question.