RADIO INTERVIEW ABC HOBART
DRIVE WITH GARY MAGNUSSEN
WEDNESDAY, 11 JULY 2018

SUBJECTS: ACCC Electricity Prices report; tax; GST distribution; Braddon; AFL team in Tasmania.

GARY MAGNUSSEN, HOST: We are joined in the studio by the Federal Treasurer Chris Bowen.

CHRIS BOWEN, SHADOW TREASURER : Shadow Treasurer, Gary. I have interest in being Treasurer but not quite yet.

MAGNUSSEN: Shadow Treasurer, Im sorry about that.

BOWEN: Its quite alright, Ill take the promotion any day. All good.

MAGNUSSEN: Fair dinkum but Chris Bowen we were starting to feel a little bit neglected in this part of the State. Thank you for coming.

BOWEN: No, its my pleasure.

MAGNUSSEN: Youve been down here a bit?

BOWEN: Yeah Ive been four times to Tasmania since the election so its an important part of the economy and as Treasurer or Shadow Treasurer its very easy to let it become a Sydney-Melbourne-Canberra job but you cant let that be the case, youve got to get out. I was in regional Queensland last week, sorry earlier last week and then in Tasmania today and tomorrow.

MAGNUSSEN: Now the energy story is whats dominating Federal Parliament at the moment or Federal political circles. A consumer watchdog says the national energy market is broken and wants a radical overhaul of the national electricity market to change the way people are charged. It says it could cut domestic power bills by up to $415 a year for people. Malcolm Turnbull says Yep Im onto that. What does the Federal Opposition say?

BOWEN: Well we say its certainly worth a very good look indeed. The report has only come out today and we dont get an advanced copy of these things so well take some time to look through it but we take it very seriously and sensible recommendations there will meet our support.

MAGNUSSEN: Face value?

BOWEN: There are sensible recommendations in there but again there is a lot of stuff in there which we need to work through and in fairness everybody should take some time to work through and its not entirely a Federal matter either, its Federal and State working together. So well obviously be constructive. There has been too much uncertainty around energy policy and the report underlines that and thats one of the issues, there has been a lack of policy certainty for the last five years in particular and that has meant that it has been very hard to get the investment thats necessary to increase energy supply and we certainly need as much certainty and bipartisanship is a very important part of that certainty and we have made that clear. We are prepared to give bipartisan support where we can. Part of the problem has been that the Government cant support some of their own policies because they are pretty divided in their party room but we will obviously supply bipartisan support where we can for a sensible policy.

MAGNUSSEN: Now does this hark back to the days of privatisation? It seems to me that what they are hinting at. Tasmania of course kept its energy asses in its hand, other states sold up. Is that they problem, that we privatised? Maybe we should have kept these very valuable assets in states hands?

BOWEN: Well certainly those States and Territories that have kept their assets I dont think regret that. Look I think going forward, whats been sold has been sold, what has been kept has been kept and thats not going to change any time soon. What weve got to do is actually get the policy settings right going forward to get that investment going, to get that generation going to and at the same time to meet our commitments on climate change.

MAGNUSSEN: Tax, its been a tricky business open the past few weeks. We had Bill Shorten abandon a position he took on the tax cuts. Just remind our audience, where are we standing at the moment with the Labor Party position.

BOWEN: We have very clear positions based on personal tax and company tax. On personal tax to start with, we have accepted the first round of the Governments tax cuts and supported those, then we have bettered them in a second round. So we will provide bigger better tax cuts for all Australians earning less than $125,000 in 2019 if we win the election.

We are not comfortable, we have opposed and will seek to appeal those tax cuts which are locked in by the Government in 2022 and 24 for a couple of reasons. Withoutbelabouring the point, we are not convinced the economy can afford them at that time. I dont know what the economy is going to be doing in 2022 and 2024 so we dont think that is a sensible and prudent way of budgeting. And two, they are not particularly well-designed, they are not well targeted.

On company tax, 99.8per cent of businesses are better off under our plans. We will again honour what has already been legislated and implemented, thats the already existing tax cuts that have come in for businesses with a turnover of less than $50 million, thats the vast majority of businesses right around the country and of course in addition to that, over and above what the Government is offering we have got the Australian Investment Guarantee which says to businesses if you invest, we will provide you with tax relief upfront which is a more generous depreciation schedule, thats designed to actually get investment going.

The problem with the Governments $80 billion worth of tax cuts is that its not conditional on anything and 60per cent of it will flow offshore to foreign investors with no requirement, no reciprocity to invest, to grow the economy. Ours is conditional on that investment occurring.

MAGNUSSEN: Are tax cuts just a pork barrel at the end of the day? I mean we heard back in the day I remember about the milkshake and hamburger tax cuts in the past, I mean Malcolm Turnbulls tax cuts for people arent going to exactly buy you a new car. Would we be better off investing those billions of dollars into infrastructure and growing the economy?

BOWEN: Well there is a balance to be struck there, of course some tax relief is warranted when youve got wages growth at record lows, youve got costs going up whether it be energy or private health insurance, cost of living going up and wages not keeping up in many instances and so we have designed our tax relief to be almost double what Malcolm Turnbull is for people, many people and bigger tax cuts for all Australians earning less then $125,000 a year but it does have to be prudent, I agree with your point and thats why we have taken a big call Gary to oppose the tax cuts, stages two and three.

Its not the conventional political wisdom, I mean the conventional political wisdom is an opposition who opposes tax cuts is committing political suicide. We didnt do it lightly but we did it because I fundamentally agree with you, weve got to make sure that the Government has the resources necessary for investment in infrastructure, in education, and in health.

MAGNUSSEN: Is that where you will put that money? Any money saved on the tax cuts that you dont go ahead with or repealed, we are talking about repealing them I guess if they get through the Parliament. Once you repeal it would you really invest that money into infrastructure and health?

BOWEN: Well its a combination of things. What we have said is that a majority of our revenue measures over the decade go to paying down debt, paying down Government debt. That is an important priority as well and of course weve got the better school funding model, we will invest $17 billion more in schools over the decade. Thats important as well and of course we will have better health funding plans in addition. Now what we dont do is say Well this money that we are getting from not proceeding with that tax cut will go to spend on that particular thing but what we do do is when the election comes around and we present our Budget books it will be very clear our different priorities including better plans to pay down the debt, Budget repair as well as better funding of schools and hospitals.

MAGNUSSEN: Now in this state, GST has been a big deal. It has been a big deal in WA as well. They think we are getting too much, we think we are getting just about the right amount I think and a bit more wouldnt hurt. Tasmania obviously not particularly happy with what is being proposed. There will be transitional arrangements for eight years to keep the money in place after that who knows? Can you just remind us what Federal Labors position is on these GST changes?

BOWEN: So its a complicated area but firstly can I say, weve been constructive about this Governments response to the Productivity Commission report. The key issue for the people of Tasmania, I think you touched on it, is where the money is coming from and whats the guarantees. Now the Government is changing the formula, proposing a change in the formula. Now I dont mind saying here in Hobart as I would say in Perth, I think the people of Western Australia have a legitimate beef and theres ways of fixing that, but it shouldnt be at the expense of the people of Tasmania.

I think there is a way through. Now we put our Fair Share for Western Australia Fund up which didnt take one dollar off Tasmania. But moving on to the Governments position, they said We will change the formula so that Tasmanians are worse off but then we will top it up from money from the Federal Budget to make sure you are no worse off. Now I think the people of Tasmania are entitled to say where is that locked in? Where is the guarantee? How do we know that that is going to behonoured in the future?

And two, and just as importantly how do we know that money is not going to be taken back off us in different ways? Cuts to health and education, particularly with this Governments form frankly after the 2014 Budget.

MAGNUSSEN: So you are saying that you will support a change to the GST?

BOWEN: What we are saying is we will work through the details in consultation with our State and Territory colleagues.

MAGNUSSEN: Your State colleagues here have a very different view. Rebecca White the Tasmanian Opposition leader, the Tasmanian Labor leader says dont change it, why not just keep it as it is? WA is getting tops at the moment.

BOWEN: Well our position is: lets work through the details. If any jurisdiction is worse off than that is something we oppose. So to that degree--

MAGNUSSEN: Therefore, So why not just say--

BOWEN: Well what we want to see, what guarantees Tasmanians have that they are not going to be worse off. Where is the guarantee that the money is locked in to the Federal Budget? Where is the guarantee that they wontsure, top up Tasmanias GST distribution but then cut the hospitals and education agreements with the other hand?

MAGNUSSEN: Lets move on to Braddon. As I said there has been a bit of a revolving door there. The fights on. Five seats, Braddon is a key seat. This has in terms of Canberra political circles come down, in terms of Braddon, to a bit of a referendum on Bill Shortens leadership?

BOWEN: No, I dont think so. We are fighting Braddon on our policies, we are fighting it with a better candidate. We are fighting it on our entire offering and people are going to all sorts of speculation as youve just done, fair enough but if we do win Braddon what does that mean for Malcolm Turnbulls leadership. I could put the question back the other way but at the end of the day its about the people of Braddon, about their priorities, about which political party is offering the best for them.

So forexample 74 per cent of Braddon taxpayers are better off under Labors tax plan for example. Thats one thing that we will be pointing out. The businesses of Braddon, 99 per cent of them are better off under our corporate tax plans. And we have the better plans for things that are important to the people of Braddon like health and education funding.

MAGNUSSEN: Well a lot of taxpayers money is being thrown around to win it. Its a bit like Brandons one Tattslotto and Im sure the other electorates are feeling the same. We could be back at a Federal election sooner rather than later couldnt we?

BOWEN: We could be.

MAGNUSSEN: Why throw so much money at this seat when it is a possibility of changing hands?

BOWEN: Well I dont think it is a matter of throwing so much money at it. It would be the first by election in Australian history that a political party hasnt made a political promise for if we didnt make a commitment.

(LAUGHTER)

MAGNUSSEN: But I just think the level of money, we are popping money up left right and centre.

BOWEN: Look, all our plans are very responsible, they are all paid for whether it is in Braddon or more broadly. We make commitments as the Liberal Party does for particular electorates. Thats all pretty fair game in the Australian political system but I dont think its exorbitant. I think they are well-designed plans and are appropriate for the needs of Braddon..

MAGNUSSEN: Now earlier today we heard Jeff Kennett lashing out about Bill Shortens commitment for $25 million

BOWEN: Oh did he?

MAGNUSSEN: for a Tasmanian AFL team. He said if Tasmanians dont want the Hawks they can let him know.

BOWEN: Thats a rather biased view, I understand he is biased, I understand he has a rather biased view.

MAGNUSSEN: Well what do you make of that? Hes saying that Bill Shortens $25 million commitment is not going to help Tasmania get an AFL team. It is a big issue down here, Chris Bowen as you would have known after a few visits down here. He is saying we need $10 million a year over the next 10 years to make it happen. Is that realistic, that the Federal Government would promise that money?

BOWEN: Well look I think the $25 million commitment is a serious one. Jeff is entitled to his view. Tasmania should have an AFL team, I have felt that for a long time. I come from Sydney but I am also an AFL tragic and Im a foundation member as my family is of the Greater Western Sydney Giants so I know how hard it is to get a new team up. Tasmania is an AFL state but its still going to be hard to get a team up so that extra support which at the grassroots level as well make sure that theyre actually Tasmanians playing on the Tasmanian AFL team. I think it would be a great thing for Tasmania and a great thing for footy and is a perfectly appropriate Government investment.

Now if Jeff is speaking in his capacity, whether it is Chairman of Hawthorn or former Liberal Premier, whatever it is Im not sure what capacity he is speaking in there but he is entitled to his view, but I dont think anybody could suggest that $25 million is not going to come in handy for Tasmania.

MAGNUSSEN: But $10 million the question was $10 million a year for the next 10 years.

BOWEN: Well thats not been put to me.

MAGNUSSEN: Is that realistic though? Is it realistic that a Federal Government would invest that much money in a State football team?

BOWEN: Well our commitment is for $25 million. Thats what it is, we are not proposing to change that. The AFL hasnt said to us Look if you give us $10 million a year then we will open a team in Tasmania. They have not put that to us. Thats Jeffs personal view. Good luck to him but what we are doing is saying we will provide seed funding to get this team up and going should the AFL decide to give Tasmania a team I think it should have, and also to provide grassroots support for football so that there are good Tasmanian players in the Tasmanian team going forward.

MAGNUSSEN: Well Chris Bowen thanks for dropping in, we dont feel quite as neglected now as the people of Braddon.

BOWEN: Well we will always share the love around people of Tasmania. Im off to Braddon tomorrow but its good to be in Hobart tonight. Its my fourth visit to Tasmania since the election, I dont think the Treasurer has been to Tasmania since the election. Ill just put in that little dig on the way out.

MAGNUSSEN: Thats a nice little kick, especially with World Cup time. Got it in beautifully. Chris Bowen thanks again for joining us.

BOWEN: Good on you, my pleasure.