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Transcript of press conference: Sydney: 23 August 2013: Superannuation; Tony Abbott's unfair PPL slug; business confidence; Asia Funds Passport, Coalition costings black hole; financial services industry; and double taxing

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E & O E - PROOF ONLY _____________________________________________________________

Subjects: Superannuation; Tony Abbott’s unfair PPL slug; business confidence; Asia Funds Passport, Coalition costings black hole; financial services industry; double taxing _____________________________________________________________

CHRIS BOWEN: Thanks for coming everybody. I’ve just spoken to the Financial Services Council and the Industry Superannuation Network, partly about the Government’s economic record, economic growth, strong economic growth, all while keeping our AAA credit rating from all three credit rating agencies. Also about the stark difference in approach to retirement incomes at this election. Our commitment to increase the superannuation guarantee from 9 per cent to 12 per cent. Our commitment to provide tax relief for low income earners and their superannuation. Both policies not supported by the Opposition.

Our commitment for a five year moratorium on major taxation changes for superannuation, legislated in law, to provide the certainty that superannuants are looking for. And our commitment not to fund a paid parental leave scheme, an expensive paid parental leave scheme by a massive slug by Australia’s investors - a 1.5 per cent levy on business with no franking credits, no relief, passed on directly to Australia’s investors. Australia’s mum and dad investors, self-funded retirees, facing a $1.6 billion a year slug to pay for Mr Abbott’s expensive, unaffordable and unfair paid parental leave scheme.

And today, we’re obviously also pointing out the impact on Australia’s charities and not-for-profit sector. Dividends are an increasing part of the income stream for Australia’s charities. They rely on franking to provide the necessary tax relief for the work they do around Australia, and yet we see Mr Abbott and Mr Hockey either not understanding the impact of their own policy, or deliberately abolishing,

deliberately abolishing the franking benefits for Australia’s charity and non-profit sector all to fund this ill thought out scheme.

I see today in the Financial Review, a National Party member using a term which would not be polite on evening television to describe Mr Abbott’s paid parental leave scheme. It just shows even the National Party has worked out just how crazy this scheme is, how unfairly it impacts on Australia’s investors, and how it is a blow to the Australian economy.

Happy to take some questions.

JOURNALIST: Sir, if, as you outlined in your remarks, the Australian economy has grown 14 per cent since the Labor Party has come to power - why do you think business including those in the FSC forum you addressed today are somewhat negative on your Government?

BOWEN: Well, I get all sort of feedback from business, and you heard some of the feedback there directly on how well this Government had worked with the financial services sector; welcoming our announcement, our imitative of a five year moratorium on changes to superannuation, legislated through the Parliament. Of course business will not agree with government at all times and government won’t agree with business at all times. We’ve got different jobs to do.

They have shareholders to serve; we have Australian citizens to serve. Often they’ll be a confluence of those policies, sometimes they won’t be, sometimes we have a difference of opinion.

Certainly as Treasurer, my door has been open to Australian business. I think you get that feedback from business and we want to work cooperatively, as the Prime Minister has said, with industry across the board, dealing with the challenges and headwinds facing the Australian economy in the years to come.

JOURNALIST: Mr Bowen, you seem pretty confident on getting signatures for the Asian Passport if you’re re-elected. Can you explain why you are confident and what you expect of it?

BOWEN: Well there’s some way to go and I have raised it with my colleagues across the Asia Pacific that I have so far met with and I have found good and positive feedback - a high degree of knowledge of our proposal and a high degree of willingness to work towards the Asian Funds Management Passport. Obviously, I won’t be attending the APEC finance ministers meeting in September - for obvious reasons - but soon after that if re-elected, I’d be keen to further engage with my colleagues across Asia Pacific; and start to get signatures on a document which would work towards the implementation of the Asian Funds Management Passport.

JOURNALIST: Mr Bowen, the Bank of America Merrill Lynch says the Coalition has a $30 billion costing, that’s less than half what you say. Is that an embarrassment?

BOWEN: Well it’s an embarrassment for Mr Abbott, no question about that. If he’s response is, ‘Oh it’s only $30 billion, that’s okay then,’ well that’s hardly an acceptable response to the Australian people. It was Mr Hockey who first said $70 billion, we’ve got analysis to show that its $70 billion. But even if its $30 billion, even if its $30 billion, it is a massive shortfall which will need to be made up for cuts to basic services, to hospitals, to schools. There’s no way of easily fixing a $30 billion black hole, or a $70 billion black hole; $30 billion worth of cuts, or $70 billion worth of cuts?

Now if Mr Abbott and Mr Hockey say that that figure is wrong, they’re saying Mr Eslake is wrong - well show us your figures. Put in your costings, release your alternative budget to the Australian people, and do so today. They said they’d do it after the pre-election economic forecast. Well guess what? That was two weeks ago. The time for excuses has well and truly run out and they are deliberately leaving it to the last week of the election campaign to avoid the scrutiny that the Australian people are entitled to give it.

If they’re not going to be up front with the Australian people about what they’re going to cut, if they’re going to leave it to the last minute and potentially until after the black out to government advertising - political advertising the Australian people are entitled to conclude they are deliberately avoiding telling the Australian people what they’ll cut; because if they were honest about it the Australian people would be a lot less likely to vote for them.

JOURNALIST: So will your Government change its rhetoric and eliminate references to the $70 billion -

BOWEN: No, we believe their black hole is $70 billion and the cuts they’d need to provide are $70 billon. But as I say, even if its $30 billion - that’s a very substantial, a very substantial black hole for them to fill. I think Mr Eslake is a well-respected economist and the work that they have done should be thoroughly read by the Opposition, and it’s not simply good enough for them to shrug their shoulders and say it’s wrong. Show us your figures.

JOURNALIST: The polls are pretty dire and they say you will potentially lose your seat on September 7. Do you have plans after politics if you lose?

BOWEN: No, I am completely focused on my task as Treasurer of Australia, and also earning every last vote in the seat of McMahon. I’ve never taken my electorate for granted in the nine years I’ve represented it. I’ve always worked to earn every last vote and that is exactly the approach I’m taking this election.

Alright? Thanks very much. One more?

JOURNALIST: Treasurer, in terms of the financial services industry you mentioned today about if a Liberal Government does come to power that the increase in super would potentially not go ahead. What other areas - is there any concern that elements of the Johnson report would not go through as well?

BOWEN: Well, I mean, the Johnson report has been very important to the Government, the Opposition has said very little about it so we would need to see what their policy was. Even if we just look at their policies on the table; delaying the increase in superannuation from 9 per cent to 12, delaying that and I have a real view that that would be the best case scenario - they’d be much more likely to abolish the increase from 9 to 12 completely, given their track record. Remembering in 1996 they promised to respect the move to 12 per cent and John Howard reneged on that promise.

Also, the massive double taxation on Australia’s investors. Reintroducing double taxation in Australia for the first time since 1987 - I mean an extraordinary thing for the Opposition to be promising to do to Australia’s investors, to the financial services industry, and to mum and dad investors across the country. A backwards step that will take us back more than 25 years is a retrograde and an amazing thing for an alternative Prime Minister to be offering the Australian people in an election context.

Thanks very much.


Communications Unit: T 03 8625 5111

Authorised by G. Wright, Australian Labor Party, 5/9 Sydney Avenue, Barton, ACT, 2600