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Transcript of doorstop interview: 70 Phillip st, Sydney: 16 June 1992



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Deputy Leader of the Opposition

16 June 1992

TRANSCRIPT OF DOORSTOP INTERVIEW WITH MR PETER REITH, MP - DEPUTY LEADER OF THE OPPOSITION 70 PHILLIP STREET, SYDNEY

E & OE - PROOF COPY ONLY TRANSCR\PR:MM

The Opposition is today releasing the latest forecasting we've done on the proposed 4 per cent superannuation guarantee levy which shows that up to 80,000 jobs be lost, using a Treasury model showing the implications of this new tax on employers.

The Democrats were opposed to 5 per cent because 100,000 people would lose their jobs, under 4 per cent, 80,000 people are going to lose their jobs at a time when nearly a million Australians are already unemployed. They should stop fiddling

around, stop trying to do deals with the Government, and they should steadfastly oppose Labor's new tax which is going to cost jobs - 80,000 on the latest revelations as a result of the calculations that we've done to date. This is a black and white issue, Labor's superannuation levy is going to cost

jobs, and for that reason the Democrats should join with the Opposition to oppose it and to save jobs.

What do you think of the plans to raise the age from 55 to 60?

Well, the preservation is, that is part of the overall debate and obviously if you're going to force people to save, then you want to make sure that the additional savings go into retirement income and are not just splurged when people get to

55 and then have them still go on to the pension. And we've been pressing on the Government to do that for some time.

...(interjection)...

Jrnlst:

What affect do you think it will have?

Reith:

Jrnlst:

Reith:

Parliament House, Canberra, A.C.T. 2600

2 .

Reith:

Well, it simply means that the tax concessions which are provided for people to save will ensure that the nest egg is kept together to go for the purpose for which the concessions were provided, which is for people's retirement incomes and

not on world trips. ...(interjection)... Well, it's part of our policy and has been for ages and they should take more of Fightback!

Jrnlst:

Isn't this the best compromise, if the Government's so determined to raise the contributions, the Democrats say they'll accept 4 per cent but they won't allow the ACTU to call for any more wage claims.

Reith:

Look, why should you accept a policy that's going to cost 80.000 jobs? Where are these people? They ought to look beyond the ivory towers of Canberra and see there's nearly a million people unemployed and they think its smart to do a

deal that's going to cost 80,000 jobs. I mean, if 100,000 jobs was reason enough to say "no" to Labor's new tax, why isn't it reason enough to say "no" to 80,000 jobs being lost. Now this is a black and white issue. We need to be creating

jobs, not losing jobs. Not deliberately imposing a new tax that's going to cost literally tens of thousands of

Australians their job. You could fill the MCG, you know, think of the MCG in the grand final, every person in that ground, if it were full, would lose their jobs as a result of this new tax and that is just crazy.

Jrnlst:

Dr Hewson said that the Democrat compromise would cost over 100.000 jobs. How is that figure come up with?

Reith:

Well, that right, and that's using the Treasury figure. What I've released today is a further analysis of the latest compromise deal which we've heard about overnight. And that's using the same Treasury model that came up with the 100,000

figure. So we know in fact that the Government itself must have this figure and they are going into this thing with their eyes open that over 80,000 jobs are going to be lost. And that obviously at a time of so many unemployed is obviously wrong. But the 80,000 figure is just a refinement and its as

a result of some further computations we've had done today.

3 .

Jrnlst:

Were you surprised by the fact that the Democrats have done this deal on superannuation?

Reith:

Well, they've always been in favour of compulsory savings, you know, of an additional tax, so to that extent I'm not

surprised but I mean, there's a marked inconsistency between yesterday when they said oh! 100,000 jobs we're opposed to losing those, but today they're in favour of losing 80,000 jobs - the 4 per cent levy. And that I think ought to bring them back to reality. They should stop doing deals with the Government and just stick to the simple point. This proposal

is going to cost jobs - between 80,000 and 100,000 jobs - and that is just crazy when so many people are already losing their jobs. We've got 680,000 children in families where neither parent has got a job and they are doing a deal with the Government for a whole lot more to be in families where neither parent has a job.

Jrnlst:

But Mr Reith, this idea of a compulsory superannuation levy is not new, is not a new one, almost every western country, every developed country, has a compulsory scheme like this. Why doesn't the Opposition support such a scheme.

Reith:

Well, we're in favour of encouraging people to save.

Jrnlst:

You're not in favour a compulsory scheme.

Reith:

No. We're in favour of giving people tax incentives as an encouragement for them to save and we're also, of course, in favour of a whole lot of productivity reforms that will actually give us the wherewithal to pay for this boost in national savings.

Now, this scheme has, as its twin pillars of justification, that it will save the Government money on the Budget and that it will increase national savings and neither of those arguments hold any water. And the Government has been embarrassed by the fact that Treasury has had to say so

publicly.

4 .

The whole rationale for this has been completely eroded and we're left now with just a deal between Mr Keating and

Mr Kelty, last year, for the political benefit of those two, at the expense of 80,000 to 100,000 people. And its an absolute indictment on this Government that they should proceed with a policy that's going to cost jobs. We need a plan to create jobs, not a plan that's going to lose us jobs, as will happen as a result of this deal.

Jrnlsts

But in the defence of that levy, isn't it true that the extra 2 per cent is a trade-off against wage increases and that's part of the deal done with the ACTU, isn't that a positive thing?

Reith:

Well, what we're seeing now from Mr Keating is, you know, you're going to have the super levy as well as a wage increase and that just means that people are going to lose their jobs. Now, these people are slippering and sliding all over the place on this issue. The reality is they can't get off the

hook. It's going to cost jobs at a time when we ought to be creating jobs, not losing them.

Jrnlsti

So you don't trust the ACTU and the Government when they say that they'll accept this as part of the wage package?

Reith:

Well, would you. Mr Keating was the man who said "I won't let there be a recession".

Jrnlst:

If the Opposition wins the next election, and this

superannuation guarantee levy is in place, will you abolish it?

Reith:

No, our policy, we've made that very clear, we will stick with what's there, but we'll freeze the levy. There won't be any increases, there won't be a progressive increase up to 9 per cent, which is the Government and the ACTU's plan.

Jrnlst:

Why not abolish it, though, and restore those 80,000 jobs, make it possible for those people to be employed again?

5 .

Reith:

Well, our view always has been that you really have got to accept what's there in place, a system that's operating upon our election to government, and that on some things you just can't turn back the clock as much as you might like to and if you're going to have job losses that's all going to be in the pipeline, obviously, as a result of this Government's policy

initiative. What we're going to do is start with the mess that we inherit and try and fix it from there.

Jrnlst:

Sorry, I missed it all, ...(inaudible)... I understand, what have they been and what's your reaction to them?

Reith:

We've done some further analysis today of the 4 per cent option and it just shows that over 80,000 people are going to lose their jobs as a result of the compromise deal that the Democrats and the Government are going to do. And we are simply making the point, I mean, if the Democrats were opposed to 100,000 people losing their jobs, which was the 5 per cent levy, they should be equally opposed to a 4 per cent levy where 80,000 people are going to lose their jobs, that 80,000

is a new figure that has been calculated today using a

Treasury model. Why would you jeopardise 80,000 jobs, when nearly a million people are unemployed. The Democrats should stop doing deals with the Government. They should sit with the Opposition, and oppose this plan, to save jobs.

Jrnlst:

Is there any time, or can there be a time, when we do get

9 per cent superannuation. Is it applicable at any stage?

Reith:

Well, we want to encourage people to save and under the

Coalition you will get big tax savings if you save, not just for your retirement, but saving in a bank account. Under us we'll have a new tax free savings scheme. That'll encourage people to save, that'll get interest rates down. That's a

genuine workable policy, not a new tax, which Labor's proposing.

Thank you very much.