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Transcript of interview with David Speers: Sky News: 8 November 2016: making superannuation more sustainable; Labor's superannuation lies; working holiday maker tax arrangements; U.S. election



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The Hon. Scott Morrison MP Treasurer

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TRANSCRIPT SKY NEWS

TUESDAY 8 NOVEMBER 2016

E&OE

Subjects: Making superannuation more sustainable; Labor’s superannuation lies; working holiday makers tax arrangements; U.S. election.

DAVID SPEERS: Scott Morrison thanks very much for your time, now I appreciate Labor has changed their position quite a few times on superannuation but if we can just look at what they announced today, they are saying it would improve the Budget by $1.4 billion over the forward estimates, nearly $19 billion over the decade, that’s no small change there.

TREASURER: What they’ve announced today is a lie. They went to the last election saying they are going to have a package of superannuation measures that was in the same Budget envelope as the Government. What they clearly were planning to do was increases the taxes on superannuation by another $1.4 billion at least. Now that is not a way to deal with the Australian people. It is completely unconscionable. They should be ashamed of themselves frankly. We had the honesty to go to the Australian people with a very comprehensive package of superannuation measures. Some of which were not well received by elements of our own supporters. We at least had the courage to do that David. What these guys did, is say they weren’t going to do what they did today, and they’ve gone on and perpetuated this great lie.

SPEERS: Ok, but you did make changes, as you acknowledge post election, and they have as well.

TREASURER: No but we’ve done that within the Budget envelope.

SPEERS: That’s true. Let’s just go to what they’ve said, a couple of measures in particular that I want to get your thoughts on. This one, their plan would improve the Budget bottom line, and in particular they don’t want to create what they are calling new loopholes, I’m sure you won’t agree with that description. One of them is offering the tax dedications for personal super contributions, now this is about, you’ve argues, self employed, or sole traders if you like. Why do you need a change to the current rules on superannuation?

TREASURER: This is incredibly important and this is a change that has been waiting around 10 years to be introduced, and it’s not inexpensive to do. But what is does is it says if you have an income other than a wage income, so let’s say you’re a contractor who as well as having a full time job. Let’s say you’ve got a home-based businesses as well as a full time job. Let’s say you work for a small business that doesn’t allow you salary sacrifice into your superannuation. And there are lot of people now in this position. We are now allowing them to access the superannuation tax concessions that are being denied them under the system for that other income. Now in a transitioning economy where people have more than one job, where people are trying to start new businesses which we think is a good thing, then we think they should be able to access those concessions. They Labor party has said today, no, you can’t get those tax concessions on the contributions to your superannuation that you’ve earned by running a businesses or working as a contractor or working for a small business. Instead, on the backpackers issue, they’re saying that

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what they can afford, is to give foreign workers a tax cut. And an added tax cut to what is in real dollar terms, in people’s pockets, to what is provided by other countries. So that’s Labor’s priorities, tax cuts for foreign workers, higher taxes for Australians.

SPEERS: They say it would benefit the wealthy largely. As would the change to allow catch up concessions for women returning to the workforce after having a child, does it benefit the wealthy?

TREASURER: No David, I’ve got to pull you up there. Someone who is working as a contractor as well as a wage earner like a firey, who has worked full time for the fire services, and then is also working as a carpenter, for example, well their carpenter’s income, and these can be modest incomes, cannot be used to make contributions to their superannuation and gain a concession. That’s just simply not fair. Labor is saying no, that’s not a priority. That reform shouldn’t be put in place, what we’d rather do, is give a tax cut to foreign workers.

SPEERS: Now on the backpackers tax, Labor is now saying they want a 10.5 per cent rate. You’re suggesting a 19 per cent rate. Labor points to the New Zealand rate which is 10.5 per cent. They say it would be competitive to match what they’re doing. Is there going to be room for compromise here?

TREASURER: No. What we’ve put forward is a clear equivalent package which leaves the backpackers when they come to Australia in the same pocket position after they’ve been paid. Minimum wages, and tax rates and purchasing parity these things are different between economies. What we’ve done is the analysis which shows that under our 19 per cent tax rate, that a backpacker working in Australia will be left with as much in their pocket after doing the same amount of work in Australia as they would be in Canada, in the United Kingdom and in New Zealand. In fact, slightly better off.

SPEERS: Do you think backpackers weigh all that up, or do you think they just look at the tax rate?

TREASURER: The other thing we have done in our package is we reduce the visa application charge by $50 and increased the spending for Tourism Australia to go out and market our programme to backpackers. Ours in a comprehensive package which deals with this problem. We committed to do that at the last election, and to fix this issue within the context of the Budget envelope. Now Labor promised the same thing David. They promised to fix this problem and also ensure that there was no diminution to revenue of the $500 million that was set aside. Now what they have done today is break that promise. They have said no, we are just going to give a bigger tax cut to foreign workers, and we’re going to let taxpayers pay for that here in Australia because we are going to increase the deficit by $500 million. That’s just bad policy and it’s bad priorities.

SPEERS: Let me just squeeze in one more question Treasurer about the U.S. presidential election. You have been openly critical of Donald Trump at times over his lewd comments, and also the protectionist stance that he and Hilary Clinton have taken here. What do you think on this election eve is at stake for Australia here?

TREASURER: You’re there, you’re about to see one of the world’s oldest democracies go through what I think is always a great thing, an election on that scale. And regardless of the controversies around the election in the United States, let’s not forget that’s a free country having a free election and these are things which I think we should always celebrate. Now, they’ll make their decisions about who their president is going to be, and that’s a matter for them. As an Australian Government we have a deep alliance with the U.S. which has survived presidents and prime ministers over generations and I have no doubt that will be the case in terms of how we will continue to work with the United States as a country with whom, we have not just shares interests, but we have deeply shares values and histories. I watch is from abroad, aware of the various potential implications with either of the candidates and then we will just simply work with the president, respectively, in our relationship, as the Australian people would expect us to do with whoever is elected, and as the

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people of the United States would expect us to do. It’s their democracy, they get to decide who their president is. Not me. I wish them well with their decision.

SPEERS: Treasurer Scott Morrison appreciate your time, thanks for joining us,

TREASURER: Thanks a lot David, always good to be with you.

[ENDS]

Further information: Julian Leembruggen 0400 813 253, Kate Williams 0429 584 675