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Transcript of joint doorstop: Ashburton: 21 February 2018: Enterprise Tax Plan' small business; Bill Shorten and Labor standing between Australian workers and a wage rise; skilled migration; population growth; Victorian infrastructure investment; National party; Trans-Pacific Partnership; the Prime Minister's visit to the United States

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The Hon. Scott Morrison MP Treasurer





Subjects: Enterprise Tax Plan’ small business; Bill Shorten and Labor standing between Australian workers and a wage rise; skilled migration; population growth; Victorian infrastructure investment; National Party; Trans-Pacific Partnership; the Prime Minister’s visit to the United States

MINISTER O’DWYER: Well I’m delighted to be here in the heart of Higgins, in the Ashburton village strip shops, and here particularly at Daniel Addicoat’s business Helloworld. I’m joined by the Treasurer, who is always a very welcome visitor to Higgins to be able to talk about the powerful impact of company tax cuts on small and medium sized businesses. We see the very direct impact on these businesses because we see the ability for them to continue to invest in their business, to grow their business and to obviously employ more people. The businesses that we have been focused on as a government have been those businesses that have got under $50 million in terms of turnover. They’re the businesses that have got a tax cut today and they’re the businesses that are going to be impacted by the Labor party if they have the ability to roll back those tax cuts for small business. I’m so delighted Treasurer that you’re here to be able to deliver this message in person to these businesses, because these are the businesses that drive our economy. 98 per cent of all business in this country is small and medium sized business and they employ more than 6.5 million Australians. They are doing the heavy lifting in our economy and we are right behind them. So welcome Scott to Higgins, it’s such a fantastic delight to have you here.

TREASURER: Thanks very much Kelly, it’s great to be here at - and I’ll do my best John Laws impersonation ‘Hello world!’ It’s great to be seeing another business that is benefiting from the tax cuts that have already been delivered and legislated. We took those tax cuts to the 2016 election with great opposition from the Labor party, including for this business that we’re standing in right today. The Labor party voted against this tax cut for this business. If they’re back in government, if they’re elected at a future election, they will take away the tax cut for this small business here in suburban Melbourne, just like they will for the millions of businesses that are out there of a similar size, employing a similar number of people. The Labor party thinks that businesses like this should be paying more to the government rather than more to invest in the growth of their business, in their staff here and their training and expanding their businesses and providing better services to their customers. We think that the idea that paying the government more rather than paying your workers more, or paying more into investing in your business, is a numpty of an idea. That’s why we have put in place a plan that would see right across the economy, the tax burden on business lowered so they can invest more in their businesses. That means wages can grow more quickly than they are now, that means businesses can expand more quickly than they are now. The Labor party is standing between a wage rise and Australian workers by opposing our plan. Worse than


that, if they're elected they will strip away the benefits for small businesses like the ones we are seeing here right now. I think that's a very clear message that we're very keen for people to understand. We're for lower taxes which mean stronger wages growth, more jobs, 403,100 jobs last year. 1,100 jobs a day. I know there's plenty of other things people are talking about at the moment but what matters most is that our economy is strong, people are getting in jobs, that Australia is a secure nation with a government focused on national security and protecting Australians. Whether it's on our borders or right here in suburban Melbourne by ensuring we have got closed-circuit cameras surveilling the local area to ensure people can feel safe as they move about the streets of Melbourne. That's what we are on about as a government. As a government, we are just getting on with the job. There's a lot to do. We are getting about it and particularly supporting small businesses like Helloworld.

QUESTION: Treasurer on the issue of jobs, Tony Abbott gave a speech in Sydney last night, he described wages and lack of housing affordability and he said one of the solutions to this is to cut our immigration intake by 80,000 people. What is your response to that, is he right?

TREASURER: As you know I was the Immigration Minister for Tony Abbott and the permanent immigration intake we have today is exactly the same as it was when he was Prime Minister. I don't recall at any time there was any discussion that that should be lowered at that time and I do recall housing affordability being a significant issue at that time. But let's break this down. Let's look at what the actual facts are. The level of permanent migration to Australia has been the same since about 2011, 2012. There has been no change. In fact, last year, it actually didn't meet the cap. It was about 7,000 or 8,000 less than what the planned level was. With permanent immigration being about the same for all of this period of time, that actually hasn't been what's been driving up population growth in Australia. Where the increase in population growth has actually come from is the more temporary migration. We've had a rebound in the number of international students coming to Australia. We've had an increase in the number of people coming on extended holidays and other things to Australia. This is what has been driving the population growth numbers up, not the level of permanent immigration.

Now, if you cut the level of permanent immigration to Australia by 80,000 that would cost the budget, that would hit the bottom line, the deficit, by $4 to $5 billion over the next four years. I think it is important you manage population growth well and that's why, as a government, we've done things like extending the waiting list for welfare for people who come as migrants. People should come to make a contribution, not take one. That's the immigration policy we're running. Under our government, what we've done is we've tightened the controls and restrictions around temporary work visas on 457s. Bill Shorten set the world record in Australia for issuing 457 visas. They are much lower today than they were under Bill Shorten. So we're managing that temporary migration, which has been fuelling some of that population growth more recently. We've got the plans in place to deal, I think, with those population pressures but by cutting permanent migration what you'd simply do is put a huge burden on the budget, some $4 to $5 billion, you would also reduce the proportion of your permanent intake that was skilled. We had to work hard to keep the


permanent intake at two-thirds being skilled. If you did what Tony Abbott suggests, then you would only reduce the proportion that was skilled migration and you'd have a bigger proportion which was family migration which ultimately gets more dependent on welfare. I know that's a very long answer, but it's actually quite a complex issue and I can understand why people would think, "well, if you cut the permanent intake, all our problems are solved." I've had quite a bit of experience in immigration. What you do is run a program with strong borders, tight controls and you focus it on skills. That's the program I ran for Tony Abbott. That's the program Peter Dutton is running for Malcolm Turnbull. That's the program I believe delivers for Australia.

QUESTION: Can you break down that figure of $4 to 5 billion over five years?

TREASURER: Four years.

QUESTION: Where's that coming from?

TREASURER: Basically, the economy is not growing at the same level. People who come as skilled migrants pay taxes. They make a net contribution to the economy. Particularly in Melbourne it isn't a hard argument to make that the migrant population has overwhelmingly come to make a contribution, not take one. Migrants make contributions to building Australia. Permanent migrants, in particular, skilled migrants, they come, they start businesses, they get jobs, they pay taxes, they invest in their communities, they run sports clubs, they make things happen. Permanent migrants have been a key source of Australia's prosperity for centuries. When you manage a migration program, you do it carefully, tightly, make sure it's focused on skills and you protect our borders. That is one thing that started under Tony Abbott with me as Immigration Minister, has continued and strengthened, I would say, under Malcolm Turnbull with Peter Dutton as Home Affairs Minister.

QUESTION: So then for the budget, is migration intake being considered at all?

TREASURER: The planned migration intake is something that is done every year in every single budget. It is a cap. It's not a target, it's a cap. Last year it wasn't met. That's fine. The way our migration program works for skilled migration is it's demand-driven. It's intended that where there are skill shortages in critical sectors, and where those skill shortages particularly have been is in many high-skilled occupations which are needed to ensure our economy grows. All you would end up doing, in some ways, is cutting off your nose to spite your face.

QUESTION: Do you think Tony Abbott and perhaps the new Senator Jim Molan are trying to organise a bit of a conversation to change the policy on the party's migration intake?

TREASURER: I don't know what Tony Abbott's doing but Jim's a good friend of mine and Jim's comments I think were quite different to the former Prime Minister's.


QUESTION: Do you think that there's a group, though, that's trying to orchestrate a change in policy?

TREASURER: No. I don't have a problem with having the discussion, as you can tell, I've been fairly wordy! I think it's an important debate to have. I don't think there's a problem with having the debate. I think the debate needs to be informed by the facts. The facts are simple. People who come as skilled migrants to the country add value to the country. That's what I believe. That's what I think Australia's economic history teaches us and I think if you are going to manage the program and you're worried about population pressures, then you need to look at the things that are driving population growth which can be better managed. Clearly the permanent intake hasn't been driving population growth because it's been the same. It's been the other areas that have lifted that population and these are people who are in the country, they're catching buses, they're on trams, walking round the streets, driving on the roads. They're not necessarily permanent residents of Australia even but they are here and it's been that temporary population in Australia that has been putting more of that population pressure and that's why we've tightened up on it. I think you'll see that impact on the figures in the years ahead.

MINISTER O’DWYER: Can I just add something there, because I think it's important to note that there are responsibilities of State Government as well, particularly when it comes to infrastructure and building the sort of infrastructure that's needed in our country and in our state. It's very disappointing to us that the current State Labor Government has obviously ripped up a cheque for a billion dollars that was to be spent on a road that would have actually improved transport infrastructure here with the East-West Link. It's very disappointing they also said no to the government with more than $830 million for the Metro Rail that would have improved the rail services here in this state. It's not good enough for state governments to play politics with these very important issues. I think it is incumbent upon state governments, too, to play their part in providing the sort of infrastructure that states need and demand and that's absolutely essential here in my home state of Victoria.

TREASURER: To put a number on that, there's $2.6 billion in federal funding for infrastructure in Victoria that we've committed here, that they haven't spent. Then there's $3 billion on top of that for the East-West Link which I know Matt Guy will spend. He'll build it. There is some $5.6 billion worth of federal money going to infrastructure projects in Victoria that they're sitting on. Why are they sitting on it? Can't they just get on with the Monash Freeway? Can't they get on with these projects? I think there's only three projects they've actually finished we have given them money for and two of them were ones we fully funded.

QUESTION: Their argument the other day at a press conference was they can't run the projects simultaneously so they need to line them all up and do them in a way that will cause minimal disruption.

TREASURER: Do you believe that?


QUESTION: It's not what I believe. TREASURER: I think you should call them out on it. They can't say, "we want more money" but they're sitting on a pile of money they can't even spend. This is what the Andrews Government does. They are really good at shaking their fist at Canberra and really bad at delivering services on the ground. The worst thing that can happen to the Andrews Government is when you actually give them the money to do something because then they have no more excuses for what's not happening here in Victoria.

QUESTION: The WA Nationals have said Barnaby Joyce doesn't have their support any more. Does this make his position untenable as leader of the party?

TREASURER: It's a matter for the National Party. That's what the Prime Minister has said. I've said what I have had to say on this topic. It is for the National Party to determine.

QUESTION: That was a very quick one. Is the Prime Minister going to raise the idea of the US entering back into the Trans-Pacific Partnership when he goes to meet with them?

TREASURER: They are matters for the Prime Minister, but I think this is a very important trip that is coming up. It is not just the Prime Minister that will be going, accompanied by the Trade Minister but also a lot of Australian business people will be there as well. I was in the States just a few weeks ago, coming back to the topic of what we were here today to talk about, seeing the impact of what is already happening with the company tax changes in the US, what that is doing for the US economy, what it's doing for wages and how that’s being passed through and really driving that economy I think will be a further encouragement to the Prime Minister, as it was to me. On top of that, trade issues will always be discussed. The Prime Minister respects the position that the President outlined very clearly at the last election but the way we landed TPP-11 leaves the door open, not just for the US but others as well, and that was only achieved because of the determination of a Prime Minister who is determined to drive jobs growth for Australia. Bill Shorten went to water. The first second there was any sort of challenge when it came to this, he just walked away. He's got no plan to drive jobs growth. He's got no plan to increase wages. In fact, Bill Shorten and the Labor Party are standing between Australian workers and a wage rise by opposing the government's plans to drive growth in the economy and, worse than that, they are going to penalise businesses like Helloworld, small businesses like this if they are elected, because they are going to steal their tax cuts away from them. Thank you.



Contacts: Andrew Carswell 0418 505 376, Kate Williams 0418 872 921