MONDAY, 22 JULY 2019
SUBJECTS: Building Australia Fund; Superannuation Guarantee.
KIERAN GILBERT: Joining us is Stephen Jones. Thanks so much for your time. Your approach to drought assistance, or at least this drought fund, has been criticised by the Government. They’re saying you're not recognising the fact that while this $3.9 billion comes from a notional infrastructure fund, it hasn't been used for five years.
STEPHEN JONES: It’s an actual infrastructure fund, It’s not a notional infrastructure fund. It’s a fund that was set up to ensure that we could take the politics out, put the money in.
GILBERT: But there's been no money spent from that fund in five years.
JONES: That's the fault of the Government. They can't be blaming Labor and saying: 'yes we established this fund, a future fund for funding infrastructure, we're not using it and therefore we want to raid it to fund other purposes'. And by the way, this is about the fourth time that they've attempted to do this. The idea of the Building Australia Fund was to put capital in there, let that grow over time to ensure that could be funding important infrastructure projects. There is no disagreement, Kieran, absolutely no disagreement that we should be providing $100 million. In fact, we see that at the bottom end for drought assistance, for drought avoidance, strengthening and resilience strengthening infrastructure. No disagreement. Let's just not rob Peter to pay Paul.
ANNELISE NIELSEN: The thing I don't understand about this argument is what's political about funding for drought-stricken farmers?
JONES: Absolutely nothing. It shouldn’t be political. We’re saying we should, we’re saying to the Prime Minister: can you find another way of doing it? We will back you'. Can you imagine if we just remove the Building Australia Fund and say that we're going to take that money out of the Medicare budget or out of the Pharmaceutical Benefits Scheme budget or out of the education budget, that would be an issue of concern as well. We actually think we should have a better way of funding infrastructure over the future and we should be putting money away for it and ensuring the politics are taken out.
GILBERT: The Government is saying they’re spending $100 billion on infrastructure, separate to this Building Australia Fund. They’re using a different model in terms of the funding. If they're spending on infrastructure, why not allow this fund to be used productively elsewhere in terms of drought mitigation and adaptation. Because it's not just drought assistance, it's actually things like dealing with the impact of climate change and so on.
JONES: Indeed through the Building Australia Fund it is anticipated that those are the sorts of projects that could be funded through that mechanism as well.
GILBERT: Why not agree to it?
JONES: Because there's more rigor and probity behind the way the monies from that fund are dispensed. There's a lot of concern about the way that it might be dispensed. I actually think we can get through this. I actually think we can find a way through this and farmers should not be the meat in the sandwich over this. We know that rural communities are doing it tough. We want to see drought resilience infrastructure built throughout the country. Hopefully we can get through this over the course of the week.
NIELSEN: It just seems quite extraordinary that Labor is willing to take the political hit on this. If you walked the street and asked your average punter what they thought, they wouldn't care where the money came from. They just want the money to go to farmers. Why is Labor really sticking to this?
JONES: I actually think they would care where the money came from. This is not the only fund that we have throughout Commonwealth financial arrangements. Can you imagine the outcry if we said: 'well we're going to pull that money out of the National Disability Insurance Scheme to fund drought resilience'. People will say: 'well they're both two very important issues, can’t we find a way to ensure we're funding both of those things'? That's what Labor's position is. Let's not rob Peter to pay Paul, we think we should be able to do both of those things, can we have a conversation which enables that to happen?
GILBERT: But the Minister has also, in terms of transparency and you've criticized the approach, he's saying that the Government is adopting the drought fund model, which they had negotiated with Cathy McGowan prior to the election and her leaving the Parliament, but one which is still accountable to the Parliament. When you say you you’re likely to find your way through it, it sounds like they're basically answering your concerns already.
JONES: I’ll leave some of my Shadow Cabinet colleagues to go through the details of the probity around how that money is spent. The fundamental principle remains the same. We shouldn't have to rob money out of a fund set up for infrastructure to provide much-needed assistance and investment in drought infrastructure throughout the country. We should be able to do both and that's Labor's position.
NIELSEN: There's a fair bit of movement in your Shadow Portfolio in Parliament this week, in particular around superannuation. We've seen divisions within the Liberal Party about whether they should be heading off this planned legislative change to have super guarantee go up to 12 per cent. The thing I don't understand about this from the Government’s perspective is if they're saying that they're going to be the government to put more money back in your pockets. Surely the rise to a superannuation guarantee won't be matched by employers. You're going to end up with less money in your pocket.
JONES: This is one of the big fallacies in what the backbench revolt is leading. I find it ironic that a group of people who are some of the highest paid within the community are running a campaign to reduce superannuation benefits, which will flow through to some of the lowest paid people within the community. Members of the Government are saying if we don't increase the superannuation from the current 9.5 per cent, through till 12 per cent in a rate of increases that don't kick in until 2021-22, then somehow that money is going to flow into people's pay packets today. Come on, give me a break. We've got a pay crisis that needs an answer now and they're proposing something that won't kick in until 2021-22 through until 2024-25. It's absolute nonsense. Here's what the impact will be. There will not one extra dollar that flows through to a worker’s current pay packet. It could impact low and middle income earners by up to $400,000 in what's available to them in their retirement income. The independent modelling that I've seen has shown that is the impact, and an additional 8 per cent of people will become reliant on the full pension as a result of freezing the superannuation guarantee where it is today at 9.5 per cent. We encourage these high-paid Government backbenchers, who are earning much more in their superannuation, to get back in their box and support what has been bipartisan policy today.
GILBERT: Stephen Jones, thanks so much for your time, we appreciate it.