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Transcript of interview with Marius Benson: 29 July 2013 :Budget, economy, Grattan Institute report, election



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David Bradbury MP Assistant Treasurer

Minister for Competition Policy and Consumer Affairs

Minister Assisting for Deregulation

Minister Assisting for Financial Services and Superannuation

Transcript of interview with Marius Benson

ABC Newsradio

29 July 2013

E&OE

Topics: Budget, economy, Grattan Institute report, election

HOST: David Bradbury, you are part of the ‘razor gang’. Are you looking for big cuts when you gather today?

BRADBURY: Look Marius, this is a process that is ongoing for Government, but obviously any decisions that are taken will be announced in due course by the Treasurer and the Finance Minister.

HOST: One of the possibilities you’re dealing with today is tax increases. Can you say definitely there will or will not be tax increases?

BRADBURY: We will be releasing the details of our deliberations in due course. I’m not going to speculate on particular issues, nor in the general. Obviously we are facing some revenue write downs. All of this is occurring against the backdrop of sluggish global growth and of course the mining sector boom, we’ve been saying for

some time now it is moving into a new phase, from the investment boom to the production boom and that presents its own challenges for the economy as well.

HOST: One of the members of the Reserve Bank board, John Edwards, is in the Financial Review this morning warning against deep cuts. Do you think he’s got a point?

BRADBURY: Mr Edwards is entitled to express his views; obviously he’s someone that is a key part of the deliberations of the Reserve Bank. His views no doubt influence monetary policy in a significant way, but obviously we’ve got an obligation when it comes to fiscal policy to make sure that we have the settings right. But we do think it is important that we continue to chart a pathway back to surplus. That’s an appropriate thing to do when the economy is growing at or just below trend, and that’s where we’re tracking at the moment.

HOST: The Grattan Institute has an assessment of the economy out today and one of the points it makes is that we pretty much wasted the boom, nearly $200 billion down the drain in the Grattan Institute’s assessment. Do you agree?

BRADBURY: I think that if you have a look, particularly at those early years of the boom, periods throughout which the Howard Government was in office, for example, between 2004 and 2007 tax revenues were revised up by an unprecedented $334 billion. Now, that is a huge windfall gain that the then-Government received. Of course, there were decisions that were taken from a fiscal policy perspective, spending decisions that were a bit lax at the time, but money has come and gone. It would have been better if it was invested in infrastructure; obviously, as a Government that has been a big focus of our priorities.

HOST: So the answer’s yes for the Howard years, they did waste the boom?

BRADBURY: Well I think clearly there were a number of decisions taken in the last decade that were taken when economic sunshine was at its brightest, when windfall gains were being received by the Government. In Government, we’ve had to pare some of those things back. They’ve not been easy decisions to take but you cannot expect the revenues that were being received during the mid-part of the last decade are going to continue to occur into the future. We’ve had to take some difficult decisions - they haven’t always been popular decisions but we’ve taken them and I think it’s important to also reflect upon the fact that whilst we’re taking these difficult decisions, Mr Abbott has not been out there articulating an alternative that shows any greater degree of prudence. In fact, most of the savings measures we’ve announced he’s opposed and frankly he has very little to say when it comes to making the difficult decisions that no doubt will be required in the future.

HOST: On the election, is it fair to say we’re not going to be voting next month?

BRADBURY: I’m not going to speculate on the date, that’s a matter the Prime Minister will announce but no doubt that will occur within the usual requirements of the Constitution.

HOST: David Bradbury, thanks again.

BRADBURY: Thanks very much Marius.

ENDS