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Caucus set to take on Cabinet over the jobs levy

ELLEN FANNING: Federal Cabinet is on a collision course with its own Labor Caucus over the question of a jobs levy. The Left Wing of the party has put forward three controversial measures. They want a temporary jobs levy; a return to the 60 per cent marginal tax rate for high-income earners; and a minimum company tax rate of 20 per cent.

Well, the faction also endorsed an industry policy which targets individual sectors - an approach which is out of favour with the Industry Minister, Peter Cook. So, the debate over industry and the jobs levy is getting louder within the Government. The Finance Minister, Kim Beazley, admits most of his Cabinet colleagues oppose the levy.

The co-convener of the Labor Left, Senator Kim Carr, told A.M.'s Fran Kelly that Caucus is ready to take Cabinet on over these issues.

KIM CARR: The Caucus has a view on these matters as well. You would expect with issues of such importance to the country, that the Caucus, of course, will take these matters very seriously. We have seen in recent times a range of views being expressed. There is, however, strong support within the Caucus for measures designed to provide assistance directly to the unemployed.

FRAN KELLY: Well, how much support for a jobs levy, apart from the Left, is there within Caucus for the levy?

KIM CARR: We have seen already statements from a number of people not normally associated with the Left, indicating their support for measures aimed directly at supporting the unemployed. As far as we're concerned, economic growth by itself will not be sufficient to provide for the restoration of full employment.

FRAN KELLY: Will there be a tussle between Caucus and Cabinet over this issue?

KIM CARR: I don't know if there'll be a tussle. It's quite clear that this Government is very responsive to the broad range of policy initiatives coming from the Caucus. We've seen that in regard to industrial relations and in regard to Mabo. There is clearly a view being expressed by some Ministers as to what their attitudes are. There are going to be other views expressed as well. If members of the Cabinet are saying certain matters before business groups and in other forums, I think it's appropriate that Caucus members also express their attitudes.

FRAN KELLY: What about cost? Is one billion dollars the amount, already decided on by a Cabinet sub-committee, enough for the long-term unemployed?

KIM CARR: Clearly, there are major problems in terms of the estimates that we have seen already. It may require greater amounts of money than that to meet the demands that have been placed on us to provide full employment before the year 2000.

FRAN KELLY: There's also a proposal from you for taxing business and the rich more. What's your logic in this overall proposal?

KIM CARR: It's very simple. We want to make sure that the benefits of the economic recovery spread through all Australians, and as a consequence that various groups in the community have done extremely well in recent years, are able to put in their contribution towards meeting their responsibilities to the unemployed of this country.

FRAN KELLY: Why target business, though? Isn't a business-led recovery the best chance for job growth? Taxing them more doesn't make much sense.

KIM CARR: It's a question of making sure that the contributions towards funding these programs are met on an equitable basis throughout the community. If we're saying to wage and salary earners that you have a job, that you should be paying more in the way of levy; we're also saying that business should be paying more as well.

FRAN KELLY: If the jobs levy doesn't get up, though, through Cabinet, would you still be pushing this idea of taxing business more?

KIM CARR: It's quite apparent there is a need to broaden the options in terms of taxation policy within this country, to ensure that we have access to larger sources of revenue. Economic growth in its own right won't be sufficient to fund such a program.

ELLEN FANNING: Senator Kim Carr with Fran Kelly.