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Posted September 15, 2016

CHRIS BOWEN, SHADOW TREASURER: ...Today underlines the shambles and chaos that underlines the economic management and policy making in the Turnbull Government. Now of course, Labor has led the debate on superannuation for two years. Here in this room, Bill Shorten and I announced Labor's superannuation policy in April 2015. The Coalition Government railed against it. Scott Morrison personally led the charge and promised never to touch superannuation taxes in the future. Then when he became Treasurer, on Budget night, he announced a series of ill-thought out and rushed policies. He rushed to failure and today he has paid the price, but more importantly, Australia's superannuates and superannuation sector has paid the price with months now of chaos and dysfunction.

It's interesting that the Prime Minister didn't turn up to today's press conference. He was the man who when asked would there be any circumstances under which the policy would change after the election, he said it was iron clad. Just last week he was asked what his biggest achievements in his first year in office were and he said, and I quote "reforms in superannuation, reforms in business tax" both of those of course under huge pressure today.

The lack of credibility of the Treasurer and the Minister for Revenue has been further fundamentally undermined today. A few weeks ago Bill Shorten, Katy and I outlined a better plan for superannuation, a constructive plan to help the Government through their mess, drop the retrospective cap, reduce the threshold for contributions tax to $200,000, not proceeding with the tax deductibility of contributions, the catch-up measure and harmonising contribution rules between 65 and 74.

The Government said that we had it wrong. Scott Morrison, Kelly O'Dwyer said we didn't understand superannuation by dropping those measures. Today, they have dropped one of the measures themselves. Katy will say more about that. But even in today's press conference, Minister O'Dwyer, when talking about the older workers measure, said we are very committed to the measure. In the same press conference they were abandoning the measure. They can't even have a consistent message in one press conference.

Now, there is a better package available to the Government. One which is better for fiscal repair. The Labor Party has shown this week what we are prepared to do for fiscal repair and we say it again today. Our package is better for the Budget bottom line. We are lectured by the Government on the moral need of children and grandchildren, to look after our children and grandchildren by getting the Budget back to balance. Today they have gone not far enough when it comes to repairing the Budget.

They have deferred a measure for one year. Imagine how much better the budget would be if they dropped the measure like we have announced we would do. And they have made the measure, their package add up over the forward estimates only by deferring a measure by one year. Of course that provides very little saving over the decade.

Now in terms of process, the Government took their package through their internal processes today to their party room. The Treasurer did ring me this morning and give me a briefing over the telephone in obviously in concise terms about the package and offered Treasury officials. We will, of course, given this Government's track record of getting these issues wrong, carefully scrutinise their package.

We will accept their briefing but we will do so at a time when we have had the opportunity to fully digest the measures and to consult with the sector, we appreciate the offer of a briefing, we will take it up at the appropriate time.

Of course, this is a Treasurer who not long ago was demanding that we sign off on the Omnibus Bill sight unseen which of course contained a $107 million error in that very bill which we identified, not him.

Of course, when you have got people like George Christensen writing Government policy, we reserve the right to take our time to scrutinise it very carefully.

The Government has indicated this legislation will not be introduced in the immediate future, it will be introduced sometime this year, the legislation the Government has indicated will be very complex, as it is to be expected, with such complex legislation it's right and proper we look at it very carefully.

So, again, the Labor Party's led this debate, we have remained consistent all the way through. This is the latest backflip on superannuation from this Treasurer who is simply not up to the job.

If the Treasurer is consistent with policy making, then he will get consistent policy. If the Treasurer is consistent with his objectives, he will get consistent policy.

This is the man who said he would never touch superannuation and now we see the latest capitulation in this long line of policy disasters on superannuation from the Government.

Superannuation is important. It's important that there is consistency and stability in superannuation. The Labor Party has shown consistently that we are bipartisan in the national interest where we can. But we'll scrutinise policy very, very carefully where you have got this Treasurer who has lurched from crisis to crisis in superannuation, of course it's right and proper that we scrutinise today's announcements carefully. Over to Katy.

KATY GALLAGHER, SHADOW MINISTER FOR FINANCIAL SERVICES: Thanks, Chris. I will just add a few comments to what Chris has said but I think the massive capitulation that we have seen today shows a couple of things. One, how deeply divided this Government is but also how weakened Malcolm Turnbull's leadership has become.

We've been told repeatedly that these reforms were iron clad, we were told that through the election campaign, we've been told that since. And then today, we see the price that's been paid when you have to have the backbench writing your superannuation policy and the price that's been paid by the Prime Minister and Treasurer for that.

Over the last four months we have had caps with $500,000 touted, we've had caps of $750,000 touted and we've even caps of a million touted. Even as late last night, George Christenson was still out arguing for the million-dollar cap and then of course today we find out there is no cap at all. This is a clear example of the division that exists within Malcolm Turnbull's Government.

I think when we've set the agenda, Chris announced our superannuation policy post the election and in response to the Government's plans. We refined some of that and just remember what happened the same day that we came out with our positions on elements of the Government's bill; Kelly O'Dwyer came out swinging. She came out attacking us, she came out saying we were against aspirational Australians and that the sky would fall in.

And then today we see that at least one of these, one of Labor's positions is going to be included in this legislation. In terms of Australian superannuation system, it does need confidence of the community.

They expect some certainty, some stability and none of that has been shown in the past four months. It's been a complete shambles and I think as late as last night, the Government still didn't know what its superannuation policy was going to be until it was ticked off by the conservative elements in the party room this morning.

BOWEN: Over to you folks.

JOURNALIST: Notwithstanding the chaos...

BOWEN: Notwithstanding the complete shambles at the heart of the Government, yep.

JOURNALIST: Notwithstanding that, is the package that the Government putting today more palatable to Labor?

BOWEN: Let's look at the package in just a couple of brief elements. Firstly, we said we would not proceed with the older workers measure. The Government has now said they won't proceed with the older workers measure, as Katy pointed out after having bagged us for not proceeding with the older workers measure just a couple of weeks ago, saying it showed we are out of touch with modern Australia, saying it showed we were in a 1970s mentality. Well, by that test the Government is now in a 1970s mentality because they have just adopted that policy.

So, of course, where the Government has done that, we acknowledge that. In relation to the deferral for one year, that really doesn't achieve very much. I mean, it defers a policy for one year which we would not proceed with at all. We are taking a much more fiscally responsible approach here. We have said that Budget repair is important. We have put on the table a package which returns more to the Budget than the Government. In relation to the caps, obviously we said the last proposal was retrospective. The Government by their actions today have acknowledged that, I would argue.

They have now an annual cap going forward. Our policy we announced a few weeks ago was a prospective cap. We'll take the time to examine the government's proposal, consult with the sector. We will be appropriately diligent and constructive where we can be, but appropriately diligent in our policy-making approach. Katy and I will, as you would expect, make a recommendation to our Expenditure Review Committee then to the Shadow Cabinet, then to the caucus, carefully, dare I say methodically and appropriately.

JOURNALIST: Mr Bowen, Mr Morrison reflected on the fact that the $100,000 yearly cap was for aspirational Australians. Is $100,000 after tax aspirational or just going too far?

BOWEN: Shane, I think by the very nature of your question you are going to the heart of why we will take some time to look at this. You know, just because the Government comes out today and says "Latest brain wave, plan Q on superannuation, we've been through A, B, C, D, we are up to plan Q, now we would like the Labor Party to support it, thanks very much". We will take our time to look at it. Katy and I make a virtue of our level of consultation with the superannuation sector in its many and varied forms, all the different funds and parts of the sector and we will do that one this. We will take our time, we will accept a Treasury briefing when we've had the opportunity to further digest the Government's proposals and we will respond in due course.

Now, they are different proposals. They are both prospective caps. One is annual, one is lifetime, they are different rates. Well we will just take some time to look at that.

JOURNALIST: Mr Bowen, isn't the reality though that you banked these savings of the Government's proposed super changes during the election and you're both going to have to do a deal (inaudible)?

BOWEN: James, the reality is we have announced a policy which has a better bottom line. We banked them and more and we have delivered on that with our policy. I will continue to say that the other measures, it would be better if the Government did not proceed with those new spending measures. As we pointed out, these are measures which might be worthy when the Budget can afford them but we are talking about Budget repair, we are talking about a AAA rating under threat, we are talking about priorities.

We made our priorities clear, our decision. So I can't accept the premise to that question because we have in a very detailed fashion outlined how we would achieve our savings and the savings go further than the Government's.

JOURNALIST: It did come out after the election, didn't you bank a $3 billion saving before the election and release a policy after the election that was $4.5 billion in savings? So didn't you actually originally....

BOWEN: David, if you are accusing us of being too diligent in finding savings and being too careful in our process to Budget repair, you can make that accusation. We made the point, David, I will say this, I stood at this lectern, it might have been in answer to a question from your good self, I can't recall which journalist, but a journalist asked me about that before the election and I said this; the Government will drop the $500,000 cap after the election. We are prepared to find ways of making that money.

I believe we've been proven right in this debate at every turn, every step of the way in the public discussion. The Government has lurched from policy to policy, from crisis to crisis on this. We will maintain our consistent approach. We have got a very good policy out there.

JOURNALIST: I hate to interrupt, I'm suggesting you weren't utterly consistent because you took one plan to the election and then it was only after the election you actually revealed the full detail of what you would do with a $4.5 billion savings. Aren't you also guilty of having one policy at one point and adjusting it later?

BOWEN: No David, what we have not done is rushed to failure. The Government announced a package in the Budget. They called an election in very quick order after that. So we needed some time to work those issues through. And yes, having taken that time, we've come up with a superior package which is better for the Budget bottom line.

I mean the proposal which Katy and I and Jim Chalmers and the economic team under Bill's leadership have put in is more Budget responsible than what Scott Morrison and Kelly O'Dwyer announced today because we believe in Budget repair. We believe - and so I continue to make the point to you that if we are going to have the argument about the Budget, acknowledge the fact that Labor's proposals are better for the Budget than the Government's.

JOURNALIST: If you have been proven right Mr Bowen, if the Government has dealt with your retrospectivity concerns, if they have adopted for example the 65 to 74-year-old measure, why can't you stand here today and say we are prepared to do a deal with the Government?

BOWEN: Because James, the Government announced a comprehensive package this morning, a couple of hours ago, the Treasurer himself says the legislation will be very complex, fair call, I acknowledge it will need to be complex. And this is the Government which has not gotten it right in the past. This Government said we should adopt the last policy. "Why didn't the Labor Party adopt the $500,000 retrospective cap. The Labor Party is being irresponsible, it should adopt out policy." Well now they have dropped it, forgive us for just taking a little bit of time to consider our position, to scrutinise the legislation.

We've shown just this week how bipartisan we are prepared to be in the national interest when it's in the national interest but we are not prepared to be a rubber stamp for bad policy. We will satisfy ourselves it's good policy on behalf of the Labor Party before supplying the Labor Party's votes in the Parliament to pass something sight unseen.

JOURNALIST: Would you identify anything in what has been announced today that you still have a concern about or is a particular...

BOWEN: For example, we believe that the measure the Government has deferred for a year, it will be better if they abolished it, for example.

JOURNALIST: Hasn't the Government chalked up a win today with the unemployment figures?

BOWEN: Brendan O'Connor will have more to say in 10 minutes as I understand it. You are very welcome at his press conference but while any reduction in the headline unemployment rate is of course welcome, I do note that 3,900 jobs have been lost and we have a 0.2% fall in the participation rate. So people are losing faith that they will find work if they enter the workforce and where you have an unemployment rate being brought down by the participation rate coming down, that is not the ideal way to achieve a reduction in unemployment.

JOURNALIST: One more thing on the Omnibus Bill, are you committed to passing that tonight?

BOWEN: As a humble member of the lower house, I'm very careful to not interfere in the prerogatives of the senior chamber but I believe we clearly have facilitated passage through the lower house expeditiously so the Senate could get it as soon as possible and I know that Penny Wong and Katy as our newly appointed Manager of Opposition Business, and she has hit the ground running, and doing an excellent job in her first week....

GALLAGHER: I have, I can confirm I have.

BOWEN: We would obviously, given that we support the Bill it would be best if it was passed as soon as possible. Last question.

JOURNALIST: The Treasurer has characterised the deal of the omnibus savings bill as a sort of successful measure he can take to the ratings agencies next month (inaudible) as proof of the Parliament can work essentially, he's indeed said a possible deal on super would send a similarly positive message. In that context, is it possible, it is likely that by the time he gets to New York to talk to those agencies, there might be a deal of some form or another on this super package?

BOWEN: Well James, in fairness, I support what the Treasurer says about the omnibus bill, it's right and proper that he refers to that with the ratings agency. He does so with my support. We want to see Australia keep a AAA rating. We are serious about Budget repair and it's good that the Treasurer is going to New York to talk to the ratings agency. I support his effort in doing so and I support him mentioning the Omnibus bill.

This is a very big piece of complex piece of legislation he has put forward to - not even legislation, package he has put forward today. He's indicated it won't be coming before the Parliament when we come back immediately so there is some time to work these issues through. We'll do so very appropriately. Katy and I, as I've said, will take our time, we won't take more time than is needed but we will take what time is needed to look very carefully at the Government's proposals, consult with the sector, we will make a joint recommendation, as we always do through our normal processes, I'll say it again, the Expenditure Review Committee to Shadow Cabinet, Shadow Cabinet to the Caucus.

Okay, thanks very much.

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