Transcripts → 2019


ABC Radio National - Breakfast

Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia


Date: Tuesday, 11 June 2019

Personal income tax cuts, press freedoms

FRAN KELLY: Mathias Cormann is the Finance Minister and Government Leader in the Senate. It’s his job to try and stitch together the numbers for these tax cuts. He joins us from Perth, bright and early this morning. Minister thanks very much for joining us. 

MATHIAS CORMANN: Good morning. Good to be back. 

FRAN KELLY: The tax cuts were the centrepiece of the Government’s re-election agenda. You didn’t have, in fact, much else on offer really that was new. But it is clear that the crossbench, along with Labor and the Greens aren’t persuaded that the entire tax cut package is in the country’s best interests, at least stage three of it in particular, which is the really expensive part of it, offering billions of dollars of tax cuts to high income earners.  

MATHIAS CORMANN: The Australian people have decided that it is in the country’s best interest. We took a plan to the last election, with income tax relief for hard working families, all hard working families, at the core of our plan to build a stronger economy to secure a stronger future. The Australian people voted in favour of our plan for income tax relief, for all of it. They voted against and rejected the politics of envy that had been prosecuted by our political competitors in this last election. The question is really one for Anthony Albanese, whether he really wants to pick up where Bill Shorten left off by prosecuting this continued high taxing, class warfare, politics of envy agenda, which Australians recognise would weaken our country and make Australians poorer. Or whether he wants to come on board with a policy supporting opportunity and aspiration as the Australian people indicated they want to see implemented after this election. 

FRAN KELLY: Well it is pretty clear that Labor is not going to support the third tranche, the high income earning tranche of this tax package. So it is pretty clear if you want this tax cut through in the short term you are going to have to negotiate with the crossbench. And One Nation and Centre Alliance are as one in terms of wanting more action on energy costs, because they say that the initial tax cut will simply be eaten up by higher power prices. So what more do you have to offer beyond the new default price scheme and the big stick divestment laws for the power companies. 

MATHIAS CORMANN: Firstly, when you make assertions on what is very clear, let me just say that my experience over the years has shown me that when the media says that certain things are very clear, in the Senate that is not necessarily the way it plays out. This time last year we were having precisely the same conversation. Various contributors in the Senate were making all sorts of comments in the lead up. The media were making assertions that unless we split this income tax plan we put forward last year, it would not go through the Parliament…. interrupted 

FRAN KELLY:That actually wasn’t what I said. I said it was pretty clear that unless you give them something more on energy prices… 

MATHIAS CORMANN: … we did not split it then. We will not split it now ….interrupted 

FRAN KELLY: No, no, no. It is often true you need to negotiate and offer the crossbenchers something and that is what I am asking you. Do you have any more to offer? 

MATHIAS CORMANN: My second point is that of course the Government is committed to bringing energy prices down. We have taken a very strong agenda to the last election to bring energy prices down. You are quite right, that includes the price safety net. It also includes our measures to stop price gouging. It includes our measures to boost supply of gas into the energy market. It also includes our underwriting new generation investment program through which we are assessing a shortlist of twelve projects, which is identified on a technology neutral basis, but which includes one coal upgrade project. We have also announced back in March, well before the election was called that we were pursuing a feasibility study into a potential new HELE coal-fired project in Collinsville to deal with, in particular, energy supply issues in central and north Queensland. So the Government is always ….interrupted 

FRAN KELLY: So is that a hint that you may be able to satisfy Pauline Hanson’s demand of a coal-fired power station? It would be popular with some of your colleagues. As you’ve said you have already funded a feasibility study. Is this likely to happen? 

MATHIAS CORMANN: I am just saying that the Government has a long standing agenda to bring power prices down. We have made a whole series of decisions already. We are committed to an electricity price reduction target of 25 to 30 per cent by the end of 2021. That is also something that we indicated during the election campaign. We will continue to engage with all non-Government Senators in order to secure the passage of the lower taxing agenda that the Australian people voted for. But we will not let Anthony Albanese off the hook. This is a test for Anthony Albanese. Will he just persist with the failed politics of envy and class warfare that was rejected by the Australian people, prosecuted by Bill Shorten before the last election. Or will he demonstrate to the Australian people that he has learned the lesson, that he has listened to the verdict of the Australian people and embrace the policies supporting opportunity and aspiration, which Australians voted for. 

FRAN KELLY: Labor is already saying though, the Shadow Treasurer Jim Chalmers again today, Labor is eager to help pass the first tranche. Labor appears open to stage two. So that’s a move. So if these tax cuts are so important to the economy, which we know they are, because the Treasurer has told us, the Reserve Bank has made it pretty clear, we need this fiscal stimulus. If they are so important, why not just split the bill, get the refunds out to people as fast as possible. What is stopping you other than point scoring? 

MATHIAS CORMANN: This is not about point scoring. This is about very important policy, about putting our country on the strongest possible foundation and trajectory for the future. If the Labor party really is eager to swiftly pass income tax relief for low income earners, as we are, then the best way to do so, is to vote in favour of our package in full. To pass the whole package. Our plan is a comprehensive plan that goes over the medium term, which prioritises low to middle income earners, but also address bracket creep, which is a drag on the economy and it provides income tax relief to all working Australians, because that actually is important for the economy. It helps build a stronger economy, which again is important for low and middle income earners. We are doing it in a phased approach, phasing in income tax relief across various income levels to ensure it is affordable within the Budget. It is a responsible plan. It is calibrated to ensure it can be afforded within the Budget over the medium term, while also boosting funding for health, education and infrastructure and also keeping the Budget in surplus all the way through. So …. interrupted 

FRAN KELLY: Minister I understand the Government is persuaded of the responsibility of the entire plan … 

MATHIAS CORMANN: As are the Australian people. 

FRAN KELLY: … but not everyone else in the Parliament is. In fact most seem un-persuaded of stage three. Stages two and three don’t come into play until after 2022 and 2024. So that’s after another election. So it’s not necessarily clear that you have a mandate for the entire package. There is a question mark amongst most in the Parliament on the other side, not your side, about this stage. I ask again, if it is so important to get these tax cuts through to stimulate the economy now and that is the clear message from the Reserve Bank, why doesn’t the Government just split it, get it through, otherwise it is like fiddling while Rome burns isn’t it? 

MATHIAS CORMANN: We want to ensure that the economy is strong this year and all over the next ten years and into the future. We have a responsibility to ensure that the Australian economy is on the strongest possible foundation and trajectory for the future. We did seek a mandate at the election for our long term plan, not just for the next three years, for our long term plan. The Australian people voted in favour of it. Now this is a bit like Groundhog Day, because the questions that you are now asking me about splitting the bill are precisely the same questions that we were asked when we put our last plan for income tax relief to the Parliament, also in three stages. Everybody in the media was saying we must split. We did not. We persisted with our plan. The Parliament in the end voted in favour of it. That is what we are calling on the Parliament to do this time around, because it is manifestly in the national interest and it is also what the Australian people voted for at an election just a few weeks ago. 

FRAN KELLY: It is a quarter to eight, our guest is the Finance Minister and Leader of the Government in the Senate Mathias Cormann. Minister, a lot of blowback on the Government over the police raids on the media last week, including on the ABC of course. Yesterday, you appeared to leave the door open for some sort of enquiry in to the investigation. Is that any kind of concession that the police went too far, that journalists deserve greater protections. What were you signalling? 

MATHIAS CORMANN: Firstly, the police is a law enforcement agency which acts independently and at arm’s length from Government as they should and as they must. So any suggestion that there is some sort of political interference or Government interference here is false. We completely reject that. The AFP acts independently, at arm’s length from the Government and is not subject to political interference, that is the first point. The second point is that the Prime Minister already last week indicated that of course we are happy to have a discussion about press freedom and how it interacts with our security laws. Freedom of the press is a very important feature of our democratic system. There are issues to be considered and we are open to the discussion. What form that will take, that is yet to be determined. When that is determined, relevant announcements will be made. 

FRAN KELLY: So when you said there are obviously a range of issues to be considered and we will make statements in relation to this later in the week, were you signalling or is the Government considering an inquiry? 

MATHIAS CORMANN: What I am signalling is what the Prime Minister signalled towards the end of last week. That is that we are open to a discussion about press freedom and how it interacts with our national security laws. Now what precise form …interrupted 

FRAN KELLY: Would the Government be open to revising some of those laws, that is what is being called for now. 

MATHIAS CORMANN: Again, all laws are always open to review. That is the sort of conversation that would take place over the next few weeks and month no doubt. I would not pre-empt what might come out of any process in the future. As the Prime Minister indicated very clearly last week, we are open to a conversation about press freedom and how it interacts with our national security laws. Our national security laws are very important, they keep us safe…interrupted 

FRAN KELLY: Of course. 

MATHIAS CORMANN: …it is very important that our law enforcement agencies continue to enforce our laws, as passed by the Parliament independently and at arm’s length from the Government of the day. There are issues that have been raised. We are open to the conversation. 

FRAN KELLY: Mathias Cormann, thank you very much for joining us. 

MATHIAS CORMANN: Always good to talk to you.