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Transcript of doorstop interview: Melbourne: 25 March 2017: penalty rates; medicine prices; Indigenous incarceration; property prices; Turnbull's great big tax give away to big business and banks

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SUBJECTS: Penalty rates; Medicine prices; Indigenous incarceration; property prices, Turnbull’s great big tax give away to big business and banks

BRENDAN O’CONNOR, SHADOW MINISTER FOR EMPLOYMENT AND WORKPLACE RELATIONS: Thanks very much for coming. I just want to make some comments about Labor’s submission to the Fair Work Commission penalty rates case. Labor has reiterated its view that there should be no cuts to penalty rates for retail and hospitality workers. Labor believes that it is unfair at a time of the lowest wage growth in a generation that the lowest paid in this country will have to get a real income cut as a result of this decision. And indeed for that reason it was Labor that introduced a Bill into the parliament and called on Malcolm Turnbull to support Labor’s position to stop the cuts to 700,000 workers in this country who will suffer as a result.

Now, Malcolm Turnbull has refused to accept our position so we’ve put our submission in which reiterates our concerns when we made a submission last year to say it is not fair to cut these worker’s wages. Unfortunately, we’ve had no support from Malcolm Turnbull.

Malcolm Turnbull has now put in his own submission and this submission is as hollow as Malcolm Turnbull. There is nothing in the submission made by the Government that will in any way mitigate the effects of this decision. There are no references to lengthening the implementation of the cuts. There’s no reference to making sure the transition will soften the landing for these hard working Australians. In fact this is a hollow submission - as hollow as the Prime Minister himself.

I mean he gets upset when people call him Mr Harbour-side Mansion, well when you have a Prime Minister that wants to give $50 billion to big business and banks and wants to give pay cuts to the lowest paid in this country no wonder people think he is unfair and he lacks empathy for working people in this country.

When, in fact, this government puts in a submission and doesn’t even look to mitigate the effects of the cuts that will hurt 700,000 workers and their families no wonder people think Malcolm Turnbull is out of touch, arrogant and only looking after the big end of town.

Quite frankly it is a bit rich for Malcolm Turnbull to support a pay cut of $77 a week for retail workers and yet want to give a $17,000 tax cut for millions on July 1. It’s a bit rich for Malcolm Turnbull to say he actually looks after people in this country, to say that he cares for workers, when in fact his submission does nothing at all to even mitigate the effects of the decision.

This is a very, very out of touch government and a very out of touch Prime Minister. This is a man, of course, we know who made a lot of money. Good luck to him. But let’s be honest he made money from money and maybe that’s the reason why he does not understand what these cuts will mean for workers in this country. He doesn’t understand that this is going to make it more difficult for people to pay the mortgage, to pay the rent, to put food on the table, to put petrol in the car.

These are going to be really difficult decisions that people will have to make because of the cut to real income at a time, as I said, where wage growth in this country is at its lowest in a generation. We’ve had a Prime Minister turn his back on these workers - turn his back on working families generally.

I do want to say a few more things about the submission and the case. Now, recently I said this is the thin edge of the wedge. Labor has been saying there’s going to be further cuts if Malcolm Turnbull doesn’t join Labor and stand up for these workers. Well as you’ve seen there are now three other awards that are subject to penalty rates cuts submissions. There are three other awards that cover workers in restaurants, that cover beauticians and hairdressers and cover workers in hotels and clubs that will be affected if indeed the Commission chooses to cut their penalty rates.

Now, the Prime Minister said it was absurd of Labor to say there’s going to be further cuts. Well, there are now indeed three other awards where there will be people arguing to cut those conditions of employment - and not a word from Malcolm Turnbull to protect the interests of these workers.

I mean do people really understand how low paid hairdressers are in this country? How low their wages are? And what it will mean to them if in fact there is a cut to their penalty rates? Do people understand how hard it is for people who rely upon working in a restaurant to make ends meet, relying on tips? Just to survive? And yet he wants to see cuts to penalty rates? This is a Prime Minister who has such a callous disregard for working people in this country.

Why is it that Malcolm Turnbull loves banks so much, and workers so little?

Happy to take questions.

JOURNALIST: Will Labor consider changes to the Fair Work Commission, try and produce changes to the Fair Work Commission to limit its powers? Because it is an independent umpire, it’s not necessarily Malcolm Turnbull problem that they made this decision.

O’CONNOR: If only that were true. The Fair Work Commission in all its iterations has been there since 1904. Indeed when Malcolm Turnbull and John Howard introduced Work Choices into this country, they limited the powers of the Commission then. The Government, the Parliament I should say, creates the parameters of the Fair Work Commission and of course it is within the remit of the parliament and Executive Government to narrow the parameters if required, by the Parliament.

Now last week, Bill Shorten introduced a Private Members Bill into the house which would in effect not only stop the effect of this penalty rates decision, but would also ensure that there would be no future decisions by that Commission in order to prevent, in order to ensure there would be no cuts to penalty rates in other awards.

Now let’s be very clear here. The Parliament has the capacity to stop the cuts. Malcolm Turnbull already has a precedent. When the Road Safety Tribunal made an order to increase the wage rates of truck drivers, Malcolm Turnbull not only revoked the order by using the Parliament, he sacked the umpire. So it’s no good for the Prime Minister to say that he can’t intervene. He did intervene to stop wages of truck drivers going up. We are now asking him to intervene, and join Labor, to stop retail workers and hospitality workers’ wages going down.

JOURNALIST: On another issue if I could, what’s your reaction to the news the cost of medicines - I think there’s more than 1000 medicines - will drop?

O’CONNOR: Any time we see greater access to medicines for Australians, Labor will welcome it. It was Labor that actually created Medicare, and the Pharmaceutical Benefits Scheme is a very significant part of that. So any occasion in which we can see medicines more accessible, more affordable for Australians, then of course we welcome it.

We are concerned though, that with this Government it’s always ‘rob Peter to pay Paul’. So we want to see exactly where they are going to find the resources to do that. But, as always, Labor are the authors of universal health care in this country, and indeed, it’s great to see that medical science is able to create better medicines for Australians to improve their quality of life, lengthen their life, and where there are opportunities to add medicines to the list then of course Labor is very supportive of that.

JOURNALIST: What’s Labor’s view on Prime Minister Malcolm Turnbull’s decision to wait for the Government’s [inaudible] setting targets to reduce Indigenous incarceration?

O’CONNOR: Well it is long overdue decision by the Prime Minister to consider placing targets in so far as the incarceration of our Indigenous citizens. In fact it’s a blight on this nation’s history that we have such a high incidence of incarceration of indigenous people. It's frightening to think that it is more likely that an indigenous male is more likely to go to jail than to go to university. We need to address this problem, and one way to

address such a significant problem is to ensure that there are targets. Labor has been calling on, in terms of closing the gap, having an incarceration target. We've been working with COAG to make sure that the states are on board so that we can prevent this horrible statistic.

I mean it's quite remarkable that the indigenous population make up around three per cent of this nation's population and yet make up 25 per cent of those that are incarcerated. Something needs to be done, it is long overdue and we are very glad that Malcolm Turnbull has acceded to our request to place incarceration on the list of targets required to close the gap between Indigenous and non-Indigenous Australians.

JOURNALIST: Does the Government need to go further and consider other measures to try to bring down the indigenous incarceration rate? Are there any obvious ideas to make sure that target is actually met?

O'CONNOR: The target is one thing that is a helpful tool to see whether there is any progress. That is not a means to an end that is just a way to assess whether what we are doing is working. Now, of course, there are many things which need to be done here. It starts with ensuring that people are given sufficient support in indigenous families, that Indigenous communities are given opportunities to find employment. One of the reasons why we see greater incarceration is that people despair, they lack hope, they don't believe that they have opportunities in life. We need to make sure we give them the opportunity for a decent education, access to the labour market, opportunities for work. We need to therefore also ensure that when people are incarcerated, we help them before they are released, to be given skills so that when they are released they can get back into their communities and into society.

So, yes, we need to do a lot more at a state and federal level to provide support so we prevent people from being incarcerated, but if they are incarcerated, that we make sure we do not give up on them and we have pre-release support and post-release support, so that they find their way back into the community. We need to listen to elders in communities so that we can find the answers. One of the problems is that we have not listened to the Indigenous leadership in this nation. We need to do a bit more listening and acting, not just telling.

JOURNALIST: It's the weekend, so lots of people will be out and about looking at properties and attending auctions, buying homes. What does Labor think should be done to try to take the heat out of the property market?

O'CONNOR: Well, we've been on the record for some time now, we believe the capital gains tax concession should be reduced, and we also think that we should confine negative gearing. Whilst we will say there will be no changes to existing investments, new investments would be confined to new dwellings. That would mean it’s more likely to ensure greater supply because people will invest in areas of residential construction. It will also mean we won't see so much enormous speculation occurring.

One of the most damning anecdotes is what people talk about at an auction, when the person about to buy their eighth investment property is up against the couple trying to

find a place to call home and that investor wins the auction and turns to the couple and says 'you can be my tenant'.

We've got to start thinking about people who cannot access the property market. Scott Morrison and Malcolm Turnbull have no plans to actually deal with housing shortages in this county, and all they have to do is to sit down with Labor, look at the plans that we have put forward that have been embraced by some eminent economists and others, including Saul Eslake who says we need to do something about the capital gains tax concessions and negative gearing. It’s not point just talking and talking as Scott Morrison likes to do. They need to start coming up with policies. Labor has had policies in place for a very long time and we believe that would be very helpful and we’re happy to work with the Government on this issue if they really cared about the housing affordability issues that people are confronting across Australia - Sydney, Melbourne, you name it.

JOURNALIST: Superannuation is that a good idea to help people achieve their first home?

O’CONNOR: No, I think that’s a terrible idea. I think if anyone who understands how compounding interest works, the idea that you would take a small part of your nest egg in your 20s and 30s out of superannuation to invest in a house - it will completely undermine the superannuation industry in this country and the need for people to have sufficient retirement savings. Labor introduced one of the best retirement savings policies in the world. Our superannuation policy has some issues but it is one of the best in the world - $1.7 trillion of savings which is great for our economy. It means that young people today that are working will ensure that when they retire they will have sufficient savings so that they can retire and live well at a time when people are living longer after retirement. The idea that we should raid the superannuation funds and that is the solution to housing affordability is a nonsense. And, on top of that, it will only inflate prices. That will only increase housing prices. You might as well take the money out of the super funds and give it to the developers because it will knock on the prices. They will go up as a result. That’s not really going to help, it’ll overheat the housing industry. The better way is to start targeting capital gains tax concessions and negative gearing so that if it is to be there it’s there for future investment property, for future houses to be built rather than existing dwellings where there is enormous speculation. Meanwhile, we have the lowest homeownership in this country for the last 50 years.

JOURNALIST: On one final issue - how likely do you think it is that the Coalition will bring back its company tax cut?

O’CONNOR: I heard the Prime Minister overnight. This Prime Minister is wedded to this major tax give away to big business. Let’s be very clear here, of the tax cuts $48.7 billion will go to big business and banks. About $10 billion of that, by the way, goes overseas. That will go overseas. So, the Prime Minister has redoubled his comments. He’s certainly restated his commitment to cut the company tax in this country.

What we have at the moment is this. A Prime Minister that’s cutting wages, cutting family tax benefits, that is cutting pensioners’ income and at the same time he wants to give that money over to big business and banks. That’s the sort of Prime Minister we

have in this country at the moment. Completely out of touch, representing only the top end of town. He’s a subservient servant of the banks and big business and he should not be proceeding down this path. It’s trickledown economics, it’s giving big money to those who have enormous money, it’s taking away from people in this country who are struggling. It will widen inequality; it will make our country less fair. It’s un-Australian quite frankly and he should start thinking about how hard it is at the moment when wage growth is at its lowest that people are struggling so hard to make ends meet.