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Transcript of interview with Barrie Cassidy: ABC Insiders: 9 October 2016: banking inquiry; Royal Commission; backpackers tax; marriage equality plebiscite; Ford; industry protection; economy



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THE HON CHRIS BOWEN MP SHADOW TREASURER MEMBER FOR McMAHON

E&OE TRANSCRIPT TELEVISION INTERVIEW ABC INSIDERS SUNDAY, 9 OCTOBER 2016

BARRIE CASSIDY, PRESENTER: Chris Bowen, good morning, welcome.

CHRIS BOWEN, SHADOW TREASURER: Good morning, Barrie.

CASSIDY: This week's parliamentary inquiry put a spotlight on the banks' failings. But in the end, it didn't take a Royal Commission to do it.

BOWEN: What we saw was a hearing which was long on apologies and short on solutions. For the executives, it appears that sorry is the easiest word to say, but for Malcolm Turnbull, Royal Commission are the hardest words to say.

We know that we need an eminent retired judge with the assistance of a special Council, with all the powers of a royal commission to get to the heart of matters, of culture, of remuneration, the financial services sector, not just the big four banks, to ensure that we've got a financial services sector working for the best interests of Australians. This was a stunt and a distraction by Malcolm Turnbull to avoid a Royal Commission. It's the latest in a long line of stunts and distractions by Malcolm Turnbull for somebody who just appears to be singly incapable of recognising that it's time for a proper examination of the conduct of Australia's banking financial services industry.

CASSIDY: Bill Shorten has written to all people that Labor is more determined than ever to get a Royal Commission across the line. What can they do?

BOWEN: A royal commission can only be called by the executive. We'll continue to use, as we have done, all the avenues of both houses of Parliament to put our case. Independents and crossbenchers by and large agree with us on the case, because the case is a strong one and we'll continue to talk to them.

CASSIDY: Is there anything inside you that say the politics in play and it's a step too far, and in fact, it ignores the facts the banks play a very important part in Australia's economy?

BOWEN: It wasn't a decision taken lightly. It's not a decision we took quickly. It was a decision taken over a long period of time when the evidence mounted.

Now, take for example, the latest proposal for a banking tribunal. Now, this is just the latest diversion. Malcolm Turnbull should be honest with people and say, there's already a banking and financial services ombudsman. What would this achieve in? The banks would have very substantial resources for their legal teams, for his banking tribunal, and

the victims of banking malpractice have no resources. This is not the answer. A royal commission would be able to, in a thorough, mature and sensible way examine all the problems and instances that have got us this far, and sensible ways forward.

CASSIDY: You do a lot of work trying to build bridges with the business community. What if they say this is indicative of Labor, you're trying to play hard ball for advantage?

BOWEN: But the Labor Party has a job to do to ensure that the Australian corporate environment works in the best interests of all, and a royal commission is a very sensible way of achieving that, of working through the issues, of having an examination as royal commissions have done in the past, examinations of complex and detailed matters and making good structural recommendations for a financial services sector that is strong, profitable, but not based on a poor practice, a poor culture of exploitation of vulnerable Australians.

CASSIDY: The backpackers tax, are you comfortable with the rate that they have come up with?

BOWEN: I think this has been a schmozzle for beginning to end. And they have completely buggered this from the beginning. What I'll be recommending, is that we take our time to allow consultation. It's clear the Government has done no consultation on the passenger movement charge. We should allow people to have their say. They expects us to say that we've got it right now. The Government may want it passed this week, but they will have taken 18 months to get to this point, so we'll take our time to make sure our response is based on good policy, proper consultation and there should be a process through the Parliament to allow it to occur.

CASSIDY: You're letting them squirm a bit rather than come to a decision on your own part. Pretty much the tactic you're take being the plebiscite.

BOWEN: We are going through the proper processes. A lot of people affected by the backpacker tax and the passenger movement charge. The Government has got this so wrong at every turn, from Joe Hockey, to Scott Morrison, we need to they have got it right this time. We are leaving open our options sensible outcome for a good policy. Tourism and agriculture are affected by these changes. They should have the time for us to examine the case on this particular matter.

CASSIDY: This week though, will you take a position against or for a plebiscite?

BOWEN: This will be discussed by our Caucus on Tuesday. I imagine that Bill Shorten will make a recommendation to the Caucus. There's no secret that we are deeply concerned. The reasons are multiple. Whether it's the cost, which is a certain, the impact on the wellbeing of young Australians in particular, who are same-sex attracted. Whether it's the diversion through what we should be doing, through a referendum, something that only a referendum could achieve. Bill has taken the approach that we should take a measured approach through this. He has met with members of the gay and lesbian community. It's a big discussion and it's right that of we've taken our time to do so.

CASSIDY: Ford has built their last car in Australia. You said you warned the country against a return to protectionism. How do the 2 positions square up?

BOWEN: Entirely because I've made 2 speeches: the case for openness and the case for the middle class. I made the point we need to ensure an open economy and open borders, that immigration and trade are good for our nation, but then very importantly, fairness cannot be lost and people on middle incomes are feeling squeezed. We had wages growth at record lose, and we need to ensure that trickle down economics is rejected and the case for the middle class is really the case for inclusive growth, ensuring that all benefit from the growth, in the regions, in the suburbs, not just the big cities. This is the point I'm making.

The case for openness cannot be won by spin and tactics. Ensuring that we've got an economy that is working for all. People in South Australia, in central Queensland and Tasmania, they sent clear messages the economy is not working for them and we need to ensure we've got approaches to economic growth so that every Australian can contribute and every Australian can benefit. Not having it focused on sectors that can be successful, while other sectors have failed.

CASSIDY: But then, if you're saying we should resist a return to protectionism, you would not have thrown money at Ford.

BOWEN: I believe in the power of markets but the power of intervention by governments to ensure the middle class is growing and strong. We have proper inclusive growth right across the board. What we had, a situation where Joe Hockey goaded the car manufacturers to leave. They said these guys should leave Australia's shores. The car industry is subsidised in every nation in the world. There's not a nation where the car industry doesn't receive some sort of government support. We can centre a legitimate debate about what that support should look like.

You talk about the middle accuracy and you have argued the middle classes should be driving economic growth.

CASSIDY: You talk about the middle accuracy and you have argued the middle classes should be driving economic growth, but where in your policies do you allow for that to happen? You're talking about wages and salary earners. Do you need to deliver more spending power to wage and salary earners?

BOWEN: A lot of argument goes to redistribution of government policies. A lot of that should be occurring at the workplace as well. We should be having a proper robust discussion of the status of the median wage in Australia. It's middle income earners that would lose out most if penalty rates were abolished with no compensation. People lecture hard working people on Saturdays and Sundays, they should be giving up wages and salaries. That's a blow to their spending power, as well as being fundamentally unfair. My Dad was a shift worker. He worked weekends and nights and Christmas Day. I look at people doing that today, why should they receive less compensation than he did for his hard work? He was a member of the hard working group of the Australian middle class. But we've got a group in Australia that no longer

want that to be the case. It's partly about government policies but partly about ensuring fairness at the workplace as well.

CASSIDY: Doesn't it have to go further than raising the minimum rage and retaining penalty rates? You have to put real income in the hands of the middle classes. Without tax cuts or an increase in salaries, wage growth has stalled. No-one is preparing to give them real income tax cuts.

BOWEN: You need to take a holistic approach to the whole issue. Whether it's supporting the minimum wage and penalty rates, saying that cuts to family tax benefit below $80,000 isn't justified. We say they are not justified. We supported tax cuts at $80,000. It's about the entire policy sets. Now in these two speeches, and I'll be making more speeches along this term, they have laid out the big picture approach that we'll take to economic policy making, supporting openness, freer trade, where possible, supporting the benefits of migration for Australia, and ensuring that people in the political class don't lecture hard working Australians for the need for them to tighten their belts and to do more, without taking a strong view to ensuring that economic growth is inclusive, to sectors that have been struggling and doing it tough. This as debate that we need to win.

The simplistic approaches that we see from people around the world, and some people in the Australian political debate, all we need to do is put or more borders and barriers, will not cut the mustard.

People are hurting, people are doing it tough. Wages growth at record lows. We can't ignore that. The Liberal approach ignores that and says we want to keep going the way we've been.

We need to ensure the economic growth is inclusive for all, as well as ensuring that openness continues. This is the keeping to the Labor approach of the '80s and '90s, but investing in things like the social wage, Medicare, the aged pension in those days, ensuring the growth benefitted all.

CASSIDY: Chris Bowen thanks for your time, appreciate it.

BOWEN: My pleasure Barrie.

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