19 March 2015
Transcript - #2015016, 2015

In the role of: Parliamentary Secretary to the Treasurer [23 December 2014 - 20 September 2015]

Interview with Kieran Gilbert, AM Agenda, Sky

SUBJECTS: Budget Reform; Higher Education Reform; Liberal Leadership

GILBERT:

Parliamentary Secretary to the Treasurer Kelly O’Dwyer and Labor frontbencher Nick Champion. Good morning to you both.

O’DWYER:

Good Morning.

GILBERT:

Kelly, first to you on this report that I started the program with, apparently the Leadership Group of the Government discussed the implications of splitting the higher education bill three weeks ago and whether or not that would still constitute a double dissolution trigger. Last night Laurie Oakes reported that the Cabinet ministers discussed, at a dinner, the prospect of an early double dissolution election – that was discussed on Monday night, reported again this morning by Peter Hartcher. Is this a serious consideration here from the Government?

O’DWYER:

Well Kieran, I am not in the Leadership Group, I am not in the Cabinet, so I can’t give you any personal insights into what was discussed in these meetings but what I would say is that we are focussed on actually getting on with the job of government, and ensuring that we have sensible policy that is introduced. We’ve been fought every step of the way by the Labor Party who are now delegating their responsibilities to cross benchers in the Senate. It’s very unfortunate that we’re not able to embark upon the sort of structural reform that we need to make sure that our budget is going to be sustainable into the future and I think that this wrecking policy of the Labor Party is one that will come back to haunt them.

GILBERT:

So, what would you say though if this was being considered, is it a reasonable consideration?

O’DWYER:

I think it’s sensible for us to focus on continuing on with the job of Government—not to be looking for double dissolution triggers. We need to be focussed on the task at hand, that’s what the Australian people expect of us, that’s that job that we were elected to do. We’re trying to get on with the job of ensuring that our economy will continue to grow, that business will be able to employ, that we have the right tax settings in place, that’s why we are about to introduce a new Tax White Paper, we’ve got a Federation White Paper under review at the moment. The Labor Party has the opportunity right now to enter into some of these key discussions about the great national challenges that face us as a nation. Instead of reading the Intergenerational Report they pooh poohed the report before it was even released.

GILBERT:

Well, that’s true Nick Champion, it was criticised before it was released. I guess the question to you on a double dissolution or an early election; it would catch Labor flat footed because you don’t really have much to speak of in terms of policies.

CHAMPION:

Well this is a desperate Prime Minister on top of a divided government and now we know he is desperately sort of grasping around for a reason to go to the polls. But I think if the Government wants to go to the polls then I think most Australians would welcome that opportunity, and I think the Labor Party would welcome that opportunity, to rid this country of what has been a terrible government who has performed well below the expectations that the Australian people set for it. So, if they want an election, bring it on, bring it on.

GILBERT:

In terms of the budget though, the Prime Minister says that within five years it is going to be broadly in balance – that’s true isn’t it?

CHAMPION:

Well the Government’s budget strategy has lurched between talking of emergencies and this sort of hyperventilating I think on the challenges that we face as a nation and then next thing you know everything’s alright and it’s going to be a dull budget. Now this Government’s been sending out mixed messages, sometimes doom and gloom, sometimes everything’s alright, and that’s produced confusion amongst consumers, amongst business groups, amongst the general public and guess what, that’s affected economic growth, so we see that in every survey. You only have to walk down any strip mall in the country to find that sentiment and what people most want is certainty, and they’re not likely to get that from this Government.

GILBERT:

Does the Prime Minister’s argument stack up in terms of the trajectory of the budget when he says within five years it will be in balance when the last week or so ..

O’DWYER:

It won’t be in balance.

GILBERT:

Well he said broadly in balance within five years are the words that he used. Are you comfortable with that?

O’DWYER:

Well, the first point to make is that the people who have described the budget as having a crisis were actually former advisers to the Labor Party. Dr Edwards, who was appointed by Wayne Swan to the Reserve Bank Board, he was Paul Keating’s adviser, and he actually said that we do have a crisis with our budget. We have seen Martin Parkinson, we have seen the new Treasury Secretary, and we have seen Glenn Stevens all talk about the need for structural reform, all talk about the fact that we are spending far too much money given the revenue that we bring in, we are spending beyond our means which is leading us to having an ever increasing structural deficit. Now this is a big problem for us as a nation.

GILBERT:

But the Prime Minister is quite sanguine about it.

O’DWYER:

Well, we shouldn’t be sanguine about the position that we are in as a country. The Intergenerational Report was very, very clear that while we are on a better trajectory than the one that Labor set us on—it is going to be half of the net debt that Labor put us on—it is still going to be comparable to the levels of Spain in 2054-2055. That currently assumes some pretty robust assumptions which are firstly, that there’s not going to be slowing in growth or an economic shock; secondly, that we’re not going to need new economic spending; and thirdly, that we are going to continue for the 15 years not to return bracket creep to people. All three of those assumptions are very big assumptions—it assumes uninterrupted economic growth for the next 40 odd years.

GILBERT:

Well the bracket creep would obviously have adverse effects on the economy, on productivity, and all the rest of it.

O’DWYER:

That’s right. That’s why Labor needs to engage in this conversation about economic reform, about tax reform.

GILBERT:

Well I’ll get to Nick in a moment but just to pursue your suggestion as well that we shouldn’t be sanguine, do you think that the Prime Minister is guilty of, I guess, some mixed messages here on the one hand saying we have this budget intergenerational problem, but then saying that we are going to have a dull budget. Surely you need to continue the reform or keep your foot on the pedal as Arthur Sinodinos said?

O’DWYER:

Well he’s continuing to say that we need to prosecute the case for structural reform, he’s highlighted that Labor has been obstructionist to this reform. But I don’t think that anybody is in any doubt that that is the job that we were elected to do—to fix the budget, to get it back under control, to make sure that we can continue to grow the economy by getting the policy settings right that encourage entrepreneurship. Lowering taxes is what we should be doing, not increasing taxes, lowering taxes to make sure that businesses have the confidence to grow and employ. That’s what will stimulate our economy.

GILBERT:

Are you worrying that some of the senior figures in your Government are wavering a bit on that intent because as you say it was a pretty clear promise?

O’DWYER:

Well look, I don’t see any wavering with my colleagues on the clear need to address our structural budget problems.

GILBERT:

Nick Champion, your reaction to that, Kelly that it still needs to be addressed—and she’s not alone as you know, Saul Eslake, and respected economists right across the board this morning, saying that this has got to be dealt with.

CHAMPION:

And that’s one of the reasons why, when we were in Government, we did very significant savings measures, things like mean testing the private health insurance rebate which saved the budget billions, saved the budget billions. The Opposition opposed it, well the then opposition opposed it, every step of the way, took us years to get it through and of course every year that it didn’t go through cost the budget. So we had significant savings when we were in Government—we’ll do so again—and Chris Bowen has indicated that we’ll set down our policy parameters and our budget parameters closer to the election as you would expect that we would, but essentially the Government’s problem is essentially that they want to load all of that pain of structural reform onto the poorest and the least able to afford it in the electorate. You only have to look at their priorities taking $6,000 off working families, slugging them $7 every time they go to a GP surgery, every time they get a blood test, every time they get a blood scan, and we are now at what, mark 4 of the GPO co-payment, so we’re still not sure that that policy is. Every doctor’s surgery in the country with a question mark over their billing procedures so, you know, what we have is a Government that sort of started out all macho, is now retreating at a rate of knots, we’ve got a Prime Minister who is pretty desperate, desperate to go to the polls to head off a challenge to him and he’s desperate to head off the Liberal Party Party Room arriving at a consensus about who will take over from him, I mean that’s the race that’s on at the moment, the Prime Minister is racing towards the polls, and his successors are racing to get a majority in the Liberal Party Party Room, that’s what’s going on. We’ve got all sorts of people, you know the foreign minister, the communication minister, all auditioning for the role of Prime Minister.

GILBERT:

On the higher education reforms, the front page of the Australian reports that Jacqui Lambie and David Leyonhjelm have only met with the Prime Minister twice in the last 18 months. Given the nature of this negotiation, I remember many times in the Howard years, he would come in, at the eleventh hour, do a deal and get it done, the Prime Minister didn’t even try to come and negotiate himself.

O’DWYER:

Again I don’t have any insight into how the Prime Minister’s office directly works on these particular issues but I certainly know that Ministers have responsibility for negotiating their legislation through the Senate. And, quite rightly, the Prime Minister gives them authority to take on those negotiating positions. Now the Prime Minister’s got plenty to do without getting involved in every single aspect of negotiation. The Prime Minister is able to negotiate when it is important to do so, and he’s been available to do that when the need has arisen.

GILBERT:

Well I guess the comparison has been made with Julia Gillard who would meet regularly with the cross bench.

O’DWYER:

I am not sure that we are holding her out though as the world’s best Prime Minister are we?

CHAMPION:

She was a very good negotiator though, a very good negotiator in a hung parliament. Whatever you say, whatever your critique about her, she was a very, very good negotiator, very good negotiator in the circumstances that she was handed, but look this desperate Prime Minister, the reason why he can’t meet with the Senators is because he’s too busy trying to corral a majority in his own Party. That’s the problem here. And we all know the unsettled division that exists at the moment and well….

O’DWYER:

I think you’re battle scared from your own experience.

CHAMPION:

Well, maybe I’ve got a little bit of post trauma in these things, but you see it, you know it when you see it, journalists know it when they see it, you know it when you see it, this is a divided Government, they can’t make up their mind about how to manage their budget and they can’t make up their minds about how to manage themselves, and we’ve got a Prime Minister who is going to run to the polls, who’s going to run to the polls as quick as he can.

GILBERT:

Nick Champion, Kelly O’Dwyer it’s good to see you both.

O’DWYER:

Good to see you too.

CHAMPION:

Thank you.