THURSDAY, 2 JUNE 2016
SUBJECT/S: GDP Figures; Deficit Levy
FIONA WYLLIE: Well we are in a Federal Election campaign and the Leaders are crisscrossing the States particularly in the East of the country. A Regional Leaders Debate was held in Melbourne in the seat of Hume and its member and the Minister for Cities Angus Taylor is with us this afternoon along with the Opposition Spokesperson on Agriculture and Regional Development and Member for Hunter, Joel Fitzgibbon. Good afternoon gentlemen.
ANGUS TAYLOR, MINISTER FOR CITIES: Good afternoon Fiona.
JOEL FITZGIBBON, SHADOW MINISTER FOR AGRICULTURE, FISHERIES AND FORESTRY, SHADOW MINISTER FOR RURAL AFFAIRS: Good afternoon team.
WYLLIE: Now Barnaby Joyce at the beginning of the campaign said its going to absolutely knock the stuffing out of all of, its going to infuriate, bore, send people crazy ultimately. So how are you both fairing, Angus Taylor?
TAYLOR: Well its exciting, theres lots happening, theres lots of debate which is good and thats what its all about and most importantly of all the thing that Im enjoying is getting out. Were not having to spend time in the corridors of Parliament House were actually out in the electorates which is always good fun.
WYLLIE: Joel Fitzgibbon, how are you going?
FITZGIBBON: Well Fiona theres not much sleep going on I can tell you that but Im looking out over the water at beautiful Batemans Bay in the electorate of Gilmore and there could be no better place to be so Im travelling pretty happily.
WYLLIE: Ok, lets start now with the GDP and figures for the first time weve seen the breakdown of growth per electorate. In our listener area every electorate is well below the states GDP of 3.9% the highest two are both 2.3% and they are Eden-Monaro and Hume. Angus Taylor what would you like the GDP of your electorate to be?
TAYLOR: Well were going along alright in much of Hume as you say but look Id always like it to be high and thats why we have the policies we do. Were very focused on growth we know in regional areas continued export growth is absolutely critical to that and the good news in the latest figures was strong export growth. We know there is are great opportunities for us now in Agriculture as well as opportunities to continue that growth in exports in resources and thats what wed like to see a lot more of and thats exactly what were focused on with our policies with our small business tax relief with our accelerated depreciation and so on, its all about getting businesses investing and growing in the regions and elsewhere.
WYLLIE: Joel Fitzgibbon, you said youre in Gilmore that has a GDP of zero. What would Labor do to stop that or to increase it?
FITZGIBBON: And it shows that the wealth across the regions is very uneven and one of our jobs as policy makers is to smooth that out as best we can. I mean in my own electorate of course Ive spent my whole political life trying to lift economic output but also ensuring that the wealth which flows from that is evenly shared throughout the community so there are two parts of this equation and of course in my own electorate weve been hit rather badly by the coming off of the mining boom, we did very well while the boom was on. Our unemployment rate got to 3.5% but now that creeping back up again as a result of the falling off of that boom. So we need to continue to strive to do things that promote economic growth but also things that make sure that people get a leg up and that that wealth is distributed as evenly as it can be.
WYLLIE: Well looking at the figures it actually gets worse the further out from the city you go. As I said Hume and Eden-Monaro are at 2.3% Parkes 1.8%, Cowper 1.5% same as Lyne, Page 1.2%, New England 1%, Gilmore as I said zero Cunningham 0.1% same as Riverina, Clare 0.2%, Richmond 0.3% these are minus and Farrer 0.5%, so things arent looking good. Joel Fitzgibbon your Leader says Labor has a plan to keep the deficit levy for 10 years but wont say if that means youre expecting a poor budget outlook for that long. How much is the deficit levy and how much do you have to ear to pay it?
FITZGIBBON: Well of course there is a link between the deficit levy and whether or not we are in deficit. We have a very very discipline plan back to surplus and well be taking if in Government the surplus to get the budget back to surplus as quickly as possible. The deficit levy is 2% on high income earners, I think youve got to be earning more than $180,000 a year so Angus and I have to cough up -good on you Angus thanks for that- but on your other point I remind you about rural communities. It is interesting to note that I think its 9 out of 10 poorest electorates in the country are represented in the Federal Parliament by the National Party. And I find it interesting that people stick with the National Party an invitation to do things the way theyve always done them and therefore they get the same result. Thats why Labor has been reenergizing in rural areas demonstrating that we have the keenness to represent their interests in Canberra and thats what Im doing today and Ill continue to do so.
WYLLIE: Angus Taylor I think it would be fair to say there is a lot of confusion around changes or not changes to superannuation or if those changes mightnt happen now or whether now we know that they are definitely, the changes will happen. What is the latest?
TAYLOR: Fiona I just wanted to pick up on a point you made before. Look, if we are to see growth in regional areas at the level wed like, and its mixed we are in a transition, tax and spend is it not the answer. You do not tax your way to growth and you know whether its the deficit levy or its other things that Labor is proposing in terms of tax and spend, this is not the answer and we know growing businesses who are paying less tax is absolutely essential.
WYLLIE: But isnt the deficit levy in at the moment and youre in Government?
TAYLOR: But we are taking it away in 2017 but even beyond that the critical thing is to give small business an incentive to invest and grow. Now we have to pay for that one way is through integrity measures in superannuation. I think there is wide spread agreement of need for integrity mutilation and we are pursuing those but the important thing to remember [audio dropout] in regional areas small business including farms of course is light blood.
WYLLIE: Some super funds say it will catch up people with small superannuation.
TAYLOR: Initiatives are being misused in some cases, there is no doubt about that and what we are proposing is a 15% tax as against a tax free position which is still highly concessional but it is simply as an integrity measure to make sure that we can afford to do the things that we really need to do which is get businesses growing, get businesses investing and also make the whole superannuation system fairer. There are a number of measures there whether its for low income superannuation offsets or bringing forward superannuation for people like women who have been out of the workforce for a period of time, we are not only encouraging business to invest we are making the whole super system much fairer.
WYLLIE: Is it impacting in your electorate with any of your supporters and affecting their generosity in donating to your reelection?
TAYLOR: No look I think the thing that is galvanizing my support in my electorate at the moment is this sense that Labor is anti-business and [audio dropout] that is very strongly felt. What we know, you were doing ok in Hume at the moment as you said on those number earlier-
WYLLIE: Other places in New South Wales
TAYLOR: It depends on which part of Hume that youre talking about Fiona and in Hume is not one single mass but-
WYLLIE: This is the first time that weve had GDP for electorate so its really interesting for us to see them.
TAYLOR: My point is simple. I know where we are growing, I have a very good sense of that because Im around the electorate all the time and we are growing where small businesses are going that is the key and thats why we are so focused on that issue and I tell you what that is absolutely galvanizing my supporters because they fully understand that.
WYLLIE: Joel Fitzgibbon, whats the Oppositions position or is it just running very negative ads playing up the electorates confusion and fears about their nest eggs
FITZGIBBON: Well youve hit the nail on the head Fiona, it was the Coalition Government that introduced the deficit tax and of course theyve tripled the deficit since then so of course it makes common sense that it has no ongoing goals. Secondly there is no doubt that Anguss superannuation concession changes will push right down through the income scale for those who are in that transition to retirement fund. Now our policies are very clear we are making choices and priority choices there are no additional taxes beyond that surcharge from income earners that Angus tried to make out there was a whole raft of taxes but there are no other tax, we are [audio dropout] Government small business tax cut up to the point where small businesses have an ? and thats just a ? priority when a Government is cutting in health, and in education, and a whole range of areas around families support which is impacting on working class families.
TAYLOR: I dont know where to start to respond to that but first of all the deficit has gone down since weve been in Government, but one thing thats clear is that it will go up if Labor, theres no doubt about that, from the numbers we are seeing and the black hole we have seen.
FITZGIBBON: Thats rubbish-
TAYLOR: [audio dropout] The idea that you will be a [inaudible] making a margin of a couple of percent which is very common for small regional businesses is a big business then I know really just think there is a complete misunderstanding of business in regional areas.
FITZGIBBON: I didnt say that Angus, I said this, we are both in the same position here the budget is in a tough position, so therefore we need to make
TAYLOR: 3 million dollars-
FITZGIBBON: This about priorities, and we made a decision that wed take some pretty hefty savings in areas where we think people can afford to give a bit up, right up the top end, the top scales in order to make the investments we need in health and education, and in skills training to make it a strong economy into the future. Weve got to get people participating in the labour market and vocational education training is a key element of that.
TAYLOR: But the way you pay for health and education is through a strong economy, you cant do it any other way and to say that the business that is turning over $3 million with a couple of percent top margin for profit is just extraordinary, I mean those businesses, they are the businesses we must get investing we must get them growing, we must get them-
WYLLIE: Now Don has sent a text-
FITZGIBBON: I didnt say that at all-
WYLLIE: Don has sent in a text into you Joel Fitzgibbon asking when was the last time a Labor Treasurer achieved a budget surplus? And points out give us a break he says.
FITZGIBBON: Well theyre clever questions arent they Fiona, and has anyone ever heard of the Global Financial Crisis? We as a Government insured that Australia was one of two modern economys right around the world that didnt go into deficit during the Global Financial Crisis and
WYLLIE: I think I you mean recession there-
TAYLOR: You went into deficit-
FITZGIBBON: Sorry at the end of the recession and so thanks for picking me up so you know its a bit [inaudible] to say that the Labor Government last time didnt produce a surplus, of course we didnt produce a surplus, and every economist in the country and indeed the world will tell you that was the right thing to do.
TAYLOR: But youre locked into spending Joel, and what was done during that period which was so damaging to the economy was just locking in spending, but locking in spending growth. And we have been dealing with it, we have brought down the deficit, I mean what Joel is saying about increasing deficit is just wrong. Weve brought down the deficit, well continue to bring it down if we stay in Government but we are doing that whilst reducing taxes to those who will drive the economy. And thats the key.
WYLLIE: But you know there are economist that have looked at the books and weve had them on our program, one in particular, [audio dropout] figures and how we are actually running at the country, thats not the case but its the belief- Joel Fitzgibbon do you have to fight that all the time?
FITZGIBBON: Well the Libs just continue to run the line Fiona, and they keep spreading mistruths. Ask Angus whos spending more, compare the former Labor Government and the current Government-
TAYLOR: Im happy to-
FITZGIBBON: Whos spending over percentage of GDP-
TAYLOR: Im very happy to do that, so during the last Labor Government we saw spending growing at almost 4 percent a year. We have brought that growth rate down to 2 percent-
FITZGIBBON: During the Global Financial Crisis
TAYLOR: Let me finish, let me finish,
WYLLIE: Please, because we are timing both of you it makes it a lot easier-
TAYLOR: Spending was growing at 4 percent a year, weve brought that down to 2 percent, and what thats allowing us to do is bring deficits down and most importantly its allowing us to give tax breaks to those who will drive the economy, and that is the key.
WYLLIE: Can I ask one last question before we have a little bit of fun in this discussion this afternoon. Steve from Grafton points out that a mine near Picton is closing, another 300 jobs lost, the Governments dont really care otherwise they would be doing something. Is there anything Angus Taylor your Government could be doing about this and I will ask Joel Fitzgibbon the same thing, as he said hes coal mining, theres been a big turnaround in his own electorate and jobs have been lost. First to you Angus Taylor-
TAYLOR: This is a tough time in the mining industry, theres no doubt about that, and Im sure Joel will agree with me on that [audio dropout] and we have to do everything we can to help those who are affected to find jobs elsewhere. Fortunately, we need to find ways of [audio dropout] employing those who are losing jobs in the mining industry in to other areas. We need to provide that support, its incredibly important [inaudible]. Certainly thats what Im focused on.
WYLLIE: Joel Fitzgibbon-
FITZGIBBON: In some regions Fiona we leveraged the mining boom very well in terms of our attempts to further diversify local economies, my Hunter regions a very good example where we built infrastructure which was dependent on the mining boom which now serves to assist in us building other industries where people can work. Of course as Angus said [audio dropout] that transition to other work is so important. Now many people mention training [inaudible] so that people have that opportunity, thats of key focus for Australia as we work towards July 2 [audio dropout]
WYLLIE: Just had a text message [inaudible]to give more tax to give business a tax cut is calling all the tax increase on Super and reducing concessional contributions will do is drive more onto the pension [audio dropout] all the time- Angus Taylor-
TAYLOR: Look I can announce now Fiona that it has been a rat free campaign for me so far, and hoping it will stay that way
WYLLIE: Joel Fitzgibbon-
FITZGIBBON: Fiona I reckon theres a fair chance Angus and I can agree on this one. We reckon all the rats are in the National Party
WYLLIE: Well leave it there- thank you very much for your time
TAYLOR: thanks Joel
FITZGIBBON: Its a great pleasure