Senator the Hon Mathias Cormann
Minister for Finance
Deputy Leader of the Government in the Senate
Senator for Western Australia
Date: Friday, 16 September 2016
TOM CONNELL: Well it has been a busy week in Parliament. Plenty happening this time around including some Budget repair with cooperation between the two major parties. For more on this, I am joined by the Finance Minister Mathias Cormann, who is with me here in the studio. Minister, thanks for your time.
MATHIAS CORMANN: Good to be here.
TOM CONNELL: I know it was a late night for you with the debate last night. A pretty productive week, you would probably agree with me there. Is this the start, do you think of more cooperation between the two major parties?
MATHIAS CORMANN: There is more work to be done. We are certainly keen to keep working with everyone in the Parliament, including and in particular the Opposition, in the national interest. This week, we have been able to legislate more than $11 billion worth of Budget improvements, but there is more work to be done. So let’s keep talking.
TOM CONNELL: On this Omnibus Bill, a couple of weeks ago you were saying Labor needs to agree to all these measures, they took this to the election, this has to be the bill they agreed to. There were quite a few compromises in the end. Did you recognise that as the Government ultimately, you carry the can here and you needed to be perhaps the one making a couple of compromises.
MATHIAS CORMANN: It is true that the measures in the Bill were reflecting the savings that both Labor and the Coalition took to the election. But it is also true that our objective was to bank about $6 billion worth of savings. In order to be able to do so we needed to get sufficient non-Government Senators on board. We were able to do this. There was a bit of give and take on both sides. The outcome is $6.3 billion worth of savings. That is a good thing.
TOM CONNELL: Do you think that is going to be the case, you have to say we’re the Government, voters will ultimately judge us more than Labor. Do you think that is true?
MATHIAS CORMANN: We are the Government. We are also, all of us in the Parliament, we are the Parliament. Voters will judge all of us. Australia needs us to act in the national interest. Australia needs us to focus on putting our country on the strongest possible economic and fiscal foundation for the future.
TOM CONNELL: Okay, now ARENA did get $800 million in the end. Initially the explanatory memorandum said that it would be taken out of the Clean Energy Innovation Fund. That was removed from the memorandum. Can you clarify is that CEIF still keeping the $1 billion, is down to $200 million?
MATHIAS CORMANN: That is not actually what the explanatory memorandum said. The money for the additional $800 million worth of ARENA funding comes from other savings in the Omnibus Savings Bill. Namely and in particular the changes to Family Tax Benefit A supplements. What has happened though is an adjustment to a jointly administered Clean Energy Innovation Fund to ensure there is not an unintended increase in ARENA resources overall beyond that $800 million. The important point here is that the overall capital allocation for the Clean Energy Finance Corporation and the Clean Energy Innovation Fund remains at $10 billion as before. It was $10 billion before last night. It is $10 billion today. On top of that, the Government agreed to restore $800 million worth of grants funding for ARENA, which is paid for by savings in other parts of the Bill.
TOM CONNELL: Okay, because earlier this week you said there was no overall effect on Government debt, because we would be reducing the amount of capital available for concessional loans. But they are different aren’t they. One is a loan the other is a grant. So it is not quite the same.
MATHIAS CORMANN: If you look at the continuation of that answer and because I also said ‘because we have also made savings in other parts of the Budget'. Given that we made a $6.3 billion save instead of a saving of just under $6 billion initially in the Bill, the Budget debt position has actually improved slightly compared to where we started.
TOM CONNELL: Okay, other compromise, possibly on tax cuts. Scott Morrison said I will go for one hundred per cent of one hundred per cent, but one hundred per cent of nothing is not the sort of pragmatic approach the Australian people expect of this Government. That seems to be the first hint that you will be willing to perhaps pass part of the tax cut plan rather than all of it.
MATHIAS CORMANN: We want to pass all of it. We have introduced legislation to implement all of it thorugh the House of Representatives. Everybody knows the Government does not have a majority in the Senate. So we will engage in the debate and let's see what comes out the other end. Certainly in our judgement, Australia needs the implementation of our ten year enterprise tax plan to boost investment, to boost productivity, to boost growth and over time to increase real wages. In the end we will have to engage with the Senate to see what we can get through.
TOM CONNELL: That did sound like an indication from Scott Morrison, would you agree with that? You get what you can get through.
MATHIAS CORMANN: We always take the view that one hundred per cent of nothing is not very desirable. We always want to get as close as possible to what the Government has put in the Budget. That is a process that will involve discussions in the Senate as always. Our intention is to pass all of it, but in the end the worst case scenario for the country is if we ended up with one hundred per cent of nothing.
TOM CONNELL: Mathias Cormann, busy week. Thank you very much.
MATHIAS CORMANN: Always good to talk to you.