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Transcript of radio interview, ABC Radio National 23 October 2013:the Coalition's proposed increase to the debt limit, the MYEFO release, the Commission of Audit, and the Coalition's plans for a second Sydney Airport.

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SUBJECT: Coalition moves to increase debt limit to half a trillion dollars, MYEFO release, Commission of Cuts, second Sydney Airport.

FRAN KELLY: The state of the budget is back in sharp focus with the Federal Government releasing it’s terms of reference for its long promised commission of audit.

Treasurer Joe Hockey, fresh from the debt crisis in Washington has also announced the Government will legislate an extraordinary increase in Australia’s debt limit. The ceiling will be lifted by two hundred billion dollars before Christmas from the current $300 billion level to $500 billion. In opposition, the Coalition was a strident critic of Labor’s lifting of the debt ceiling. This new cap, which will have to be legislated, will be an unprecedented half trillion dollars.

Chris Bowen is the Shadow Treasurer, Shadow Treasurer, good morning, welcome to Breakfast.

CHRIS BOWEN: Good to be back Fran, Good morning to you.

KELLY: Will Labor support the increase to the debt ceiling when it comes before the parliament?

BOWEN: Well we will be responsible, there is, the debt ceiling does need to be lifted, but this is an extraordinary proposed lift by Mr Hockey. A 66% lift in the debt cap that he is proposing, $200 billion, as you say, to half a trillion dollars.

Now this is a Shadow Treasurer, a Liberal party which campaigned, promised, to pay off the debt quote unquote, and then in a pretty lazy and lackadaisical press conference yesterday, he casually says we’re going to increase it to half a trillion dollars.

So we’ll be looking very closely at it, we’ll be responsible but what Mr Hockey should have done yesterday is release the mid-year economic forecast, it was just a few weeks ago Fran that the pre-election forecast was put out, not by me but by the Departments of Treasury and Finance, it showed debt peaking at $370bn, a couple of weeks later Mr Hockey says he needs half a trillion, well he should have justified that by releasing the mid-year economic forecast. And he should fix it…

KELLY: Is that your issue, the lack of justification? I do note that in 2012, when Labor in Government wanted to lift the debt ceiling from $250bn to $300bn, at the time Joe Hockey, the Shadow Treasurer, argued Labor hadn’t explained the case for why. Is your issue that there hasn’t been supporting documents to justify this increase because we will get the mid-year economic forecast before Christmas.

BOWEN: Well it’s a very big issue Fran, a very big issue. And Mr Hockey has now said he will release it before Christmas, he previously said January. We complained about that, at least he’s now said before Christmas. But there’s no excuse not to release it now, it’s been released at this point in previous years, it’s been released earlier than this, under Labor previously, and if Mr Hockey wants to increase the debt cap, the very least he could do is release the mid-year economic forecast, update the figures. Tony Abbott promised to do that before the election, Mr Hockey would have jumped up and down and screamed blue murder before the election if I’d tried this, increasing a debt cap to half a trillion dollars without releasing the budget update. In a pretty lackadaisical press conference yesterday he just casually says “I’m going to increase it to half a trillion dollars”.

KELLY: In political terms though you’ve just really summed up the point of this haven’t you? That it makes sense to increase the debt level, we need to do it anyway, why not do it and put a buffer in place, it makes sense in economic terms and it makes sense in political terms. So that they don’t have to keep coming back, as you did every year, and have the opposition scream blue murder in your terms?

BOWEN: Well clearly it’s the latter that is driving Mr Hockey here.

KELLY: Is there anything wrong with that though? It makes no difference if you raise…

BOWEN: Well I think you’ve got to justify it. I think you’ve got to justify it and outline it. I mean, he just picked a figure of half a trillion dollars, he has to justify that figure, so we’ll be looking carefully at it, I’ll obviously be consulting the Shadow Cabinet about our approach. We will be responsible of course, and there does need to be an increase in the debt cap. But for Mr Hockey just to assume that the parliament will just tick off his debt cap I think shows a pretty arrogant approach.

KELLY: The government has released the terms of reference for its Commission of Audit. A fairly wide ranging commission of audit of government finances, that will potentially identify billions of dollars in Budget savings. Do you support this notion or the audit?

BOWEN: Well, audits occur all the time, that the role of an exponentiary review committee, that’s what happened under us. The point we make about the Commission of Audit Fran is that we pointed out that the Liberal Party would cut if they won office, we pointed out that they should have been upfront about where the cuts come, not hide behind a Commission of Audit, let’s…

KELLY: They’re not hiding behind it. It’s not necessarily hiding behind it, if you’re putting in four respected people to go in and have a close look, it’s not hiding behind something. It’s being proactive isn’t it?

BOWEN: Well it is, it is in the election context Fran, and they went to the election saying they wouldn’t cut. We had a commission audit. Mr Hockey explicitly last night on the 7:30 show refused to say that he would seek a mandate for any cuts. That’s a clear indication that they’ll be cuts during this term before going back to the people. I believe we’ll look carefully at the recommendations but clearly this is a serious process and we’re seeing the Commission of Audit under the Howard government recommend sweeping cuts, we’ve seen it under Campbell Newman…

KELLY: Not all of them, not all of them bad from those Commissions of Audit, I mean I think the Future Fund would was something you would support?

BOWEN: Well the Commission of Audit in Queensland for example. Massive cuts to the public service and the Commission of Audit, as I say, under John Howard, very substantial cuts recommended. Future Fund is something quite separate I think to the Commission of Audit recommendations on contracting the size of services to the Australian people which I think would have been better dealt with in an election context. But we will look at it. Mr Hockey again last night indicated that although they’ll receive the report early next year, he implied it wouldn’t be released until Budget day so, we’ll be pursuing that matter as well because we do think openness and transparency is important and it’s something that is severely lacking in this government.

KELLY: Your listening to RN breakfast, its quarter to eight, we are speaking with the Shadow Treasurer Chris Bowen. I guess it’s not unexpected the sort of commentary we’re getting from the new Treasurer and the new Government. Joe Hockey says Labor left behind a budget in very bad shape. We have inherited a budget that continues to deteriorate. This is the moment of truth for Labor. We’re dealing with Labor’s legacy, discovering all the things they failed to reveal properly to the Australian people, and over the next few weeks and months we’ll explain that to the Australian people, so you’re going to have to wear some of this and it seems as if though perhaps some of the funding cuts will be blamed fairly and squarely on you.

BOWEN: Well that’s what you would expect Mr Hockey to do, but Mr Hockey has to realise that he is now the Treasurer, not the Shadow Treasurer. He is responsible for his actions and his inactions. And as I said Fran, a couple of weeks ago the Departments of Treasury and Finance released the update, it showed the true state of the books. Mr Hockey is not telling the truth when he says they have revealed things which we had not revealed because everything was revealed in the pre-election economic forecast and the budget update I released just before the election. If the situation is worsened since then, he has to take responsibility as Treasurer and the first thing he can do is release those figures.

It’s simply unacceptable and not good enough to say ‘things have gotten worse since Labor was in office, since we were in office, but I’m not going to tell you how much, or why, or what is happening until a few days before Christmas’. By the way, until I do that, can you let me increase the credit card limit to half a trillion dollars. Unacceptable and his political game playing will not be acceptable to us and we will be pointing that out.

KELLY: Does that mean you won’t allow the debt limit to be raised that much?

BOWEN: No, I have already said Fran, we will be responsible, we will look at it carefully.

KELLY: Yes, but what does that mean?

BOWEN: Well, that means we will look at it carefully and we will be asking Mr Hockey to better justify his request, and we will consider it in the best interest of the nation.

KELLY: Can I just get your view, your opinion on a suggestion today that Joe Hockey is planning to support, announce Coalition support for a second airport at Badgerys Creek and that it was planning to announce the funding for this, give the go ahead for this in their first budget. Do you support that idea?

BOWEN: Well again Fran, I think this in an important issue of transparency and openness, It is a few weeks since the election. I am a western Sydney MP, I live in Western Sydney, it’s a big issue in Western Sydney. The Liberal Party was targeting Western Sydney seats. If they were upfront with people they could have revealed this before the election and we could have had a proper debate about it. I think the people of Western Sydney are entitled to better than what is a very significant and major development being trotted out a few weeks after an election. So again, we said in office that there was a case for a second airport for Sydney, but if the Liberal Party is planning, and I see the speculation, if the Liberal Party is planning to fast track Badgerys Creek airport that will be a breach of trust, they should have been upfront about that before the election.

KELLY: Chris Bowen, thank you very much for joining us.

BOWEN: Good on you.