Interviewer: Laura Jayes

Panel: Linda Reynolds/Graham Perrett

Jayes: Linda Reynolds, first to you. The Government has dropped its very unpopular plan to change the rate of indexation for the rate for the pension. Is this too little too late? Should the Government have dropped this a little earlier than just a couple of days out from the next budget?

Reynolds: Well first of all, good afternoon Laura to you and to your viewers. And I have got to say I think it’s a fantastic announcement today and I think it is a portent of things to come in the budget on Tuesday where we get the balance right. We get policies that are fair, measured and balanced and really take note and consideration of our current financial circumstances, so I think Scott Morrison and the Treasurer have done a masterful job at getting the budget just right.

Jayes: Is that an admission that the Government did go too far at the last election trying to get 23 billion dollars in revenue out of the pension over 10 years?

Reynolds: No, not at all Laura and I think that what people forget is that the Government admittedly took a very ambitious budget, which was the right thing fiscally for this nation, but we still got 75 percent of the budget through and a lot of very important measures that have already reduced by over 170 billion dollars, the national debt throughout the next decade and a half. So while we didn’t get everything through, we certainly got a lot of very good reforms through the Senate.

Jayes: Graham Perrett this does mean that some part pensioners will be getting a lesser rate, some will have a reduced rate, some won’t qualify at all, but 170,000 will get an extra 30 dollars a fortnight. Doesn’t this pass the fairness test?

Perrett: Well I’m sure that those who do get that extra two dollars a day will appreciate it in these times of rising power prices, rising food costs and the like. However, obviously like any Government decision, we will wait until Budget night but any Government decision that makes 320,000 people worse off is something we will have to look at in detail before we get a proper considered response. I’ve got to disagree with Linda big time obviously this Budget. The last Budget is still hanging around the neck of this Government. It was a dog of a budget then and it continues to bite people all the way along so pensioners will be wary and I will be interested to see what actually rolls out on budget night.

Jayes: But this does seem to target, Graham Perrett, those that can afford to stand on their own two feet, so what wouldn’t Labor support this in principle? All of the details have been released today.

Perrett: Well the details still need to be given a going through with a fine tooth comb. That’s why we need Chris Bowen and the finance team to do. That’s what a proper opposition does, we don’t just want to respond to every whim of an idea.  We could have set our response based on those rock solid election commitments that Tony Abbott made not to increase taxes, not to touch pensions, but obviously he completely back-flipped on that and if the best guide to future behaviour is past behaviour, all Australians should be alert and alarmed, especially pensioners.

Jayes: Okay so there will be…

Reynolds: Well no I’ve got to come in and say, absolutely have a look at past performance and what is very convenient for Bill Shorten and for Graham is that when they came into Government less than a decade ago, they had absolutely no debt, there was 50 to 60 billion dollars in the bank and we were living within our means and six years later, they frittered it all away completely unnecessarily. They didn’t invest in infrastructure we needed, so when we came to Government, we had to cut our costs to what we inherited from them, as inconvenient as it is for Graham.

Jayes: Okay well we…

Reynolds: No, because this is important because this is the journey that we are starting the budget on. We are now borrowing over 100 million dollars a day just to pay health welfare and other benefits. We are paying a billion dollars of taxpayer’s money on monthly interest, so once we are able to balance the books again we’ve still got a balloon of over 200 billion dollars’ worth of money to pay.

Interjection – 

Jayes: Sure. Graham Perrett, I will let you respond in just a moment, but Linda Reynolds, we heard from Ian Yates today saying there needs to be bipartisanship in this space. Scott Morrison, at his media conference today, ruled out supporting Labor’s plans. So when we talk about bipartisanship, doesn’t the government have to be more pragmatic as well when it comes to super in particular?

Reynolds: Well Laura, I absolutely agree this has to be bipartisan and Labor has to find a way just to stop their blind obstructionism in the Senate, which you and I both know have been occurring since the last budget, and work together. I think there is no greater demonstration by this government than the announcement by Scott Morrison today, that this is exactly what they are putting for. It is fair, it is balanced and it makes sure that those who need it most. The welfare is not an entitlement it is something to go to those most in need, and if this is not a hand out to the Labor party to say ‘let’s work together on this’, they will support nothing , so I think this will be a great test for the Labor party.

Jayes: Graham Perrett, I want to get your response there and this whole idea of bipartisanship in this area.

Perrett: Well, let’s get things in a little bit of history there Linda, obviously trying to mislead us there. The IMF said that the Costello Budgets were the most profligate time in Australian history so they were living outside their means so…

Jayes: Can we go into some more recent history there…

Perrett: Okay more recent history.

Interjection- 

Perrett: So the reality is the Australian Government in the last Budget, tried to attack the poorest quartile and make them shoulder the burden. The Australian people who are basically committed to fairness and equality said, no way.

Jayes: Okay but there is a new proposal on the table, so a bit of bipartisanship would go a long way here. Would you agree?

Perrett: Yea definitely and I’m glad to see that Hockey and Abbott Government have considered looking at whether those who can afford it most, and whether to dip into their pockets.

Jayes: Okay there might be a bit of agreement on this new proposal as well, a kind of Netflix tax for intangible downloads as their described. Having a ten per cent tax on that has been put forward today this has been leaked in the papers ahead of the Budget, Graham Perrett this is something that Chris Bowen touched on yesterday so Labor would be championing or at least cheering on this idea wouldn’t they?

Perrett: Well Labor has been looking at this for a while certainly to give Australian businesses a level playing field rather than being hampered by Australian rules and the Australian taxation they play, obviously Tony Abbott made it very clear that he would not get, said that 33 times before the election, he’s decided to do an about face on that. We’ll have a look at that on budget night and thereafter to see what benefits there are for Australians.

Jayes: Linda just on this tax, many Australians would argue that they already pay so much more for music video downloads, and Netflix than the rest of the world so why is this tax justified?

Reynolds: Well look I think Laura, time and technology doesn’t stand still and I think it is important to make sure that everybody is paying their fair share of tax and also so that it doesn’t distort the market here in the entertainment industry, so we will obviously have to wait for the budget to see what’s in there on Tuesday but time doesn’t stand still and tax doesn’t stand still and this is obviously something that we will need to look at to make sure that its fair for industry and that people are paying for their fair share.

Jayes: The Abbott Government, this budget has been described as crucial for Tony Abbott but in particular Joe Hockey and Sky News was reporting this morning on the AM agenda program that, in fact, two cabinet ministers have agreed with Nikki Savvas column this morning that this is do or die for Joe Hockey if it doesn’t go down well he will have to go. We saw some comments from the prime minister this morning, this is what he had to say to those reports

…complete invention, he didn’t say it to me, I didn’t say anything to him. I’ve spoken to him about this story, it’s a complete invention. The budget belongs to no individual minister, it belongs to all of us, but it particularly belongs to all the members of the expenditure review committee, that’s me, that’s warren trust, that’s Joe Hockey that’s Matthias Cormann that’s Scott Morrison and that’s Josh Frydenberg [Prime Minister Tony Abbott] 

Jayes: Linda Reynolds, do you agree with some of your colleagues that this is a crucial budget for Joe Hockey more than any other members of the Government?

Reynolds: I think the PM is absolutely dead on, this is a complete invention. It is a complete distraction and what do your opponents do if they can’t actually talk about the policies themselves, you attack the man. And in this case it’s playing the man and not the ball. What the opposition should be focussing on is how to work together with us to make sure we get the best possible outcomes out of this budget for all Australians.

Jayes: Graham Perrett, is it the Treasurer who owns the budget or is it the whole of Government. The whole expenditure review committee, the pm the cabinet?

Perrett: Well technically you’re right with the latter, but obviously the treasurer is the number one salesman and we saw the death of a salesman, that great play start last year on budget night and I think this one will is going to be the last nail in the coffin that alright looks like a chip he took to it with a nail gun. I can’t see Hockey surviving too much longer, I mean this was a disgrace of a budget last year and I can’t see him do anything much better, he couldn’t do us worse I could guarantee you that, he could not do us worse than last year’s budget. But I think his days are numbered. He just could not recover from that disaster from last year.

Jayes: Well we will see and certainly there has been a boost in the polls in recent times for the Prime Minister personally at least. Graham Perrett, Linda Reynolds, a pleasure to have you on the program today.

–ENDS–