23 August 2016
Transcript - #2016045, 2016

Interview with Patricia Karvelas, RN Drive

SUBJECTS: Superannuation, Budget repair, Foreign investment, Same-sex marriage plebiscite.

PATRICIA KARVELAS:

Minister, welcome to the program.

MINISTER O’DWYER:

Great to be with you, Patricia.

KARVELAS:

How much ground will you give on your superannuation policy? I know Cabinet met today, are you any closer to a final policy?

MINISTER O'DWYER: Patricia of course we never discuss what we discuss in Cabinet in fact we never talk about even the items that are listed for Cabinet so it's a nice try. But what I would say is that with our superannuation package, we are absolutely committed to making sure that we have a sustainable superannuation system that will serve Australians not only today but well into the future. It needs to work for the people today, their children and their grandchildren. The objective of superannuation is to provide retirement income that either substitutes or supplements for the Age Pension. Our package delivers that.

KARVELAS:

But we know that the backbench pressure is to lift the lifetime superannuation contributions cap from $500,000 to $750,000. In fact, if you look at some backbenchers including George Christensen who say they want to cross the floor on this, they are looking at $1 million as a figure. But I have seen analysis that has been published in the Guardian this afternoon, conducted for the Greens but it is from the Parliamentary Budget Office which shows that if you actually bow to backbench pressure to lift the lifetime superannuation contributions from $500,000 to $750,000 it would actually cost the Budget more than the existing regime. That’s what the Parliamentary Budget Office has found.

MINISTER O'DWYER: I think everybody's getting a little bit ahead of themselves on this, Patricia. We go…

KARVELAS:

Do you contest their findings?

MINISTER O’DWYER:

Well let me first address your point about the backbench and people raising issues around superannuation and their thoughts around it. We welcome people contributing to the discussion there is no issue with that that happens with every piece of legislation. There is nothing unusual in that. There is nothing unusual in consulting with colleagues and stakeholders in putting together the legislation that forms a particular package. Again, we are doing that as we would ordinarily do. In terms of the Parliamentary Budget Office, I obviously haven't seen the specific costings because I don’t think that's actually been released by the Greens but I can't actually comment on that until I've seen the specific costings.

KARVELAS:

But you’ve obviously modelled what it would cost the Budget if you were to change that threshold?

MINISTER O’DWYER:

Well I can't comment on the Greens' costings that is something you'll have to ask them about.

KARVELAS:

I’m saying you – you would have costed what an adjustment to that $500,000 would be.

MINISTER O’DWYER:

Well I am not going to be talking about our costings. I can talk about our package; our package is very clear. We have a package that delivers more flexibility for people wanting to save for their retirement, particularly those people who have been out of the workforce for a period of time who have not been able to take advantage of their concessional contribution caps. We're allowing those people for the first time from 1 July next year to be able to make catch up contributions for the portion that they don’t use. This means that potentially someone will be able to contribute an additional $125,000 over that five year period if they take full advantage of that.

KARVELAS:

OK but on this $500,000 figure is that still up for negotiation? Yes or no.

MINISTER O’DWYER:

What I am saying Patricia is that we always consult with colleagues around…

KARVELAS:

So that figure is still up for consultation?

MINISTER O’DWYER:

No you are putting words in my mouth Patricia. I am saying that what we always do with all legislation is we consult with colleagues. I think you would find it pretty extraordinary if we didn’t, I mean they are elected representatives. They do represent their community. We also consult with stakeholders. This is very, very ordinary.

KARVELAS:

So is it likely that that $500,000 figure could shift?

MINISTER O’DWYER:

I know you’d like to speculate…

KARVELAS:

Get an answer, yeah.

MINISTER O’DWYER:

On what it may or may not be but I am just sorry that I can’t actually assist you with entering into this speculation. We are just going through the process, Patricia.

KARVELAS:

Which is to look at that figure and see whether it may be adjusted, right?

MINISTER O’DWYER:

No, you’re saying that. You’re saying that.

KARVELAS:

Well what would you like to say that is different to that?

MINISTER O’DWYER:

Well what I would say is that we are talking about all of the measures within the package. We are talking to stakeholders about the benefit of extending the concessional contributions for an additional 10 years – this is over and above the catch up contributions so that people from 65 through to 75 will be able to potentially contribute up to $250,000.

KARVELAS:

Sure but I am just asking about that contentious element.

MINISTER O’DWYER:

It’s a package Patricia. It’s a package which has got a whole variety of different measures. You want to focus on one particular measure. There are other measures that are in this package that people say that they want and that they need. For instance, there is a particular measure within this package that says to people that no matter how you are employed, no matter who employs you, you can be on a level playing field and contributing your concessional cap going forward from 1 July next year so that if you work for a small business that doesn’t offer salary sacrificing, under our changes you will be able to take full advantage of your concessional contribution because of the changes that we are making. This puts everybody on a level playing field it helps small business in them competing for talent.

KARVELAS:

What is your message then, to your colleagues who are agitating for this cap which I am focussing on, you are right, but they want a rise on that cap to $750,000. What is your message to them?

MINISTER O’DWYER:

I don’t need to send a message to them through you Patricia I talk to them every day.

KARVELAS:

And what are you saying to them?

MINISTER O’DWYER:

We are talking about superannuation we are talking about the package. A lot of them absolutely love a number of the measures within the package that actually increase flexibility for individuals, particularly many women who have spent time out of the workforce. 

KARVELAS:

Sure but what are you saying to them about the bits they don’t like? Because they are the bits that you obviously need to keep negotiating on.

MINISTER O’DWYER:

You are assuming something here that is somehow different to what would ordinarily be the process. This is the ordinary process Patricia and I know you’d like to make a big story out of this and I am really sorry that I can’t satisfy you on that.

KAREVLAS: You have partly satisfied you are saying that you are negotiating on these elements.

MINISTER O’DWYER:

No I haven’t said we are negotiating, I’ve said we are talking to our colleagues. It’s quite different.

KARVELAS:

Alright well you are using different language. I want to move on to the Budget.  The government has been pressuring Labor to agree in principle to this Omnibus Bill which includes this $6.5 Billion worth of savings measures. Labor wants to see the detail, what is unreasonable about that? Isn’t this that just what you would expect anyone in the Parliament to expect? Of course they want to see the detail.

MINISTER O’DWYER:

But Labor are playing games with this Patricia, as you well know, because Labor had banked on $6.5 billion in savings during the election. Now they are saying that they would like to revisit that, they would like to reconsider that and see whether or not they want to stick to that.

KARVELAS:

No, they are not they are actually saying that they need to see the detail because of course…

MINISTER O’DWYER:

Well, no. They haven’t given an in-principal commitment that they are going to support the Omnibus Bill which is all of the savings that they have said that they would agree with and that was during the election campaign.  Now when it comes to negotiating new things going forward obviously there are some differences that we have with the Labor party on a number of other savings measures. We are very happy to sit down with them and talk to them about those measures that will actually help repair the budget and help repair the budget bottom line because we have a responsibility in the Parliament, we have a responsibility to our children and our grandchildren to make sure that they are not paying higher taxes or accepting deeper cuts in government expenditure down the track to pay for accumulated debt that we have built up right here, right now.

KARVELAS:

If you are just tuning into RN Drive, my guest is Kelly O’Dwyer, she is the Minister for Revenue and Financial Services. Fairfax is reporting that Chinese investors are being encouraged to seize a unique political moment to acquire Australian infrastructure assets after the blocking of the $10 billion Ausgrid bid to Chinese mega firms. Is the government now more eager than ever to show it is pro-foreign investment?

MINISTER O’DWYER:

Our position hasn’t changed at all. The Treasurer is the decision maker when it comes to foreign investment. He assesses each application as to whether or not it is contrary to our national interest. He has the criteria that he applies in making that decision and he seeks advice from all of the relevant departments and relevant agencies. Nothing has changed in relation to that. I absolutely make no apology, Patricia, for the government defending our national interest and we will continue to do that.

KARVELAS:

Would you like foreign investment in Australian infrastructure assets?

MINISTER O’DWYER:

Of course we support foreign investment where it is in our national interest, we always have.

KARVELAS:

But would it be helpful in infrastructure specifically?

MINISTER O’DWYER:

We always have, Patricia, whether it is infrastructure, whether it is companies, whether it is any asset that will help to grow our economy and help to provide more jobs. We do welcome foreign investment, in fact Australia has always relied on foreign investment but we have always had a caveat that says it needs to be in our national interest or not contrary to our national interest, is the technical way of putting it, we need to make sure that we do protect our national interest when people look to purchase assets, whether it be infrastructure or anything else.

KARVELAS:

Just briefly on another issue that you have talked about in the past, it is not a portfolio issue but it is a broader issue – incoming Victorian Senator Derryn Hinch has vowed to side with the Opposition on the same sex marriage plebiscite.

He says it is crazy at the cost of up to $250 million. The numbers are stacked against you on this it looks like your plebiscite legislation could actually be blocked?

MINISTER O’DWYER:

Well you don’t know what the numbers are until you actually test the numbers. I do query that the figures that are being really thrown around like confetti around the cost a national vote for a plebiscite. 

KARVELAS:

Well shouldn’t the government then provide us with what the figure is?

MINISTER O’DWYER:

When the government has made a decision around the mechanism and the timing of the plebiscite that will absolutely be made public. That decision has not yet been made. We have sought advice from the AEC; that has recently been received by the Special Minister of State that has been contemplated at the moment.  We took a position to the election, Patricia, and as much as I am a great supporter of same sex marriage, we took a position to the election and said we are going to let the Australian people have a vote on this. This was enthusiastically embraced, it is a commitment that we have made and we will deliver on it.

KARVELAS:

Senator Hinch compared it to the unsuccessful referendum in 1999 he said and I am going to quote him because the quote is quite something they will muddy the question and muddy the waters so much it will get a no vote. What are you doing to guarantee that the question isn’t stacked?

MINISTER O’DWYER:

It will be considered by Cabinet, it will be considered by the partyroom and it will be considered by the Parliament. It will be considered by all of those layers before it actually gets put to the Australian people.  I think that is a pretty sensible way to go about it.

KARVELAS:

But you obviously have a strong position on this.

MINISTER O’DWYER:

I do, I have a very strong position on it.

KARVELAS:

So will you be involved in trying to ensure that it is not – what is your response to Derryn Hinch who thinks the question is going to be loaded?

MINISTER O’DWYER:

I don’t know why he thinks the question will be loaded. I would have thought that you would need to actually see the question before you put a view like that.

KARVELAS:

Well because he has a view that the people who are against gay marriage are going to try and make it impossible for it to get up.

MINISTER O’DWYER:

The people who are against it are going to argue very strongly against it, I am not one of those people. I will be arguing very strongly for it. I know that there will be a lot of people who will be doing the same and there will be a lot of people who will want to actually cast a vote for a change in the Marriage Act. I think we have to put our faith in the Australian people to be able to make the right decision in a respectful way. At the end of the day whatever the decision the Australian people make, it will be the right decision because it will reflect the broad Australian view.

KARVELAS:

On a personal level, will you campaign actively on this issue if we have a - if it actually happens the legislation passes. Will you be involved in the campaign?

MINISTER O’DWYER:

I will because I have a strong view on this.

KARVELAS:

Well thank you for joining us Kelly O’Dwyer.

MINISTER O’DWYER:

Thanks Patricia.