SKY NEWS SUNDAY AGENDA
SUNDAY, 18 NOVEMBER
SUBJECTS: The Liberal’s lack of an economic plan; Productivity; Newstart; Liberal Chinese Visa refusals; Climate change; Victorian Labor Conference.
KIERAN GILBERT: I’m joined by one of Labor’s senior economic team, the Shadow Assistant Treasurer, Stephen Jones. Stephen thanks for your time. As I said, the economy needs that shot in the arm. Where in your view should it find it?
STEPHEN JONES: Look, the Government's got to act. The Reserve Bank has made it abundantly clear that they don't believe that there's much more room for monetary policy to give the stimulus to the economy that is needed. What we need is the Government to step in to boost demand through some pretty simple measures. Bring forward the tax cuts to July next year, which currently not slated to come into place until July 2022. We need to be looking at bringing forward infrastructure spending and they should be looking at a measure like Labor's proposed business investment tax incentive. There's three simple measures that could and should be introduced immediately.
GILBERT: Your position about bringing the tax cuts forward is supported by both the CBA chief executive and the Westpac chief, but I'm wondering, is Labor going to return to the argument of Paul Keating and Bill Kelty, who say that you need to also reduce the top marginal tax rate, far from increasing, like Labor promised to if you won the election?
JONES: We’re more than two years away from the next election Kieran, and there are two tranches of tax cuts that are already legislated for. So let's look at the immediate problems that we've got at the moment. We need to be boosting consumer confidence, getting some more money into the economy and more money into consumers pockets, but more importantly than that, sending a message to households that the Government's got a plan, because they're going into this Christmas break with one-third of consumers having already indicated that they're going to spend less this Christmas than they did last Christmas. So, far from seeing the Christmas period as the traditional time in which you get a boost to the economy, it looks like we could be going further backwards. Households are looking for a plan from the Government and so far they've got nothing, nothing at all. The Government can't continue to sit in the grandstand. It's got to get out onto the field and start playing the game. Start doing the job that it’s elected to do. We need a plan. They should use the final two weeks of parliament to come to Canberra and explain what it is they're going to do get this economy moving again.
GILBERT: You talk about sending a message to households, but your leader Anthony Albanese sent a message to the whole nation recently that Labor is going to be about aspiration. So to be about aspiration, surely it needs to be about incentive, it needs to be about returning to the Keating Hawke Kelty argument that the top marginal tax rate should be reduced?
JONES: Anthony set out the first of three key speeches that he is going to be giving, he'll be giving another speech in Brisbane on Friday this week where he'll be outlining a plan for the economy. I'm not going to pre-empt any of those things, but I anticipate that he'll have a bit to say about productivity, because if we're going to do anything to improve the long-term prospects of the Australian economy, we're going to do anything to ensure that we can have sustained and sustainable wage increases and a boost in demand, we've got to solve the productivity problem, which has actually gone backwards in the last 12 months. We need to get business investment moving. We need to be dealing with the flagging productivity, and I think the Anthony is going to have a bit to say about that, along with some of the other economic directions that will be taking Labor party policy in.
GILBERT: That's fair enough to be talking about productivity because that is a massive issue, but you still need to zero in on that point that I'm asking you about, the high marginal tax rate, you're going to increase it. Now if we're talking about aspiration, if we're talking about incentive in the economy, why don't you re-embrace the Keating model? He says it's absurdly high. He says there's a distortion between the marginal tax rate of forty seven percent and the company tax rate of 17 points, yet Labor wanted to increase that distortion.
JONES: Sure, whatever we do on the tax front Kieran is going to be paid for, and at the moment we have two tranches of tax cuts, which have been legislated for. We're proposing to bring the second of those forward, but importantly on the third tax cut, 95 billion dollar hit to the budget - it's not funded, so we want to have a look at what's affordable and what's not affordable. With two years until the next election will have plenty to say about tax and personal income tax over the course of those two years, but we've got a bit of a review going on of our taxation policies. We've already announced some changes, were backing the second round of tax cuts, indeed asking that they be brought forward. What happens over the next two years on tax policy we've got plenty of time to work through that, to consult with business to consult with the workforce and we'll have more to say about that next year in the year after, Kieran.
GILBERT: But do you accept that it's also about the message it sends?
JONES: We are sending a message that Labor wants to grow the economic pie. That we understand the needs of households. We want people to get on, we want them to earn more money, we want more spending power and we want to ensure that we have a plan in place that gets sustainable growth and productivity growth in the economy. We’ll be setting out the direction of those. Anthony's delivered one speech already in Perth the week before last. He'll be addressing another forum in Brisbane at the end of this week and we’ll be laying out a few more directions. But like I said, long way to go before the next election. Our number one job I've got to say, is to keep this lousy Government to account and to be encouraging it to be implementing some economic plans and economic stimulus that is needed right now. The Government is not doing anything. If you listen to any of their speeches, three-quarters of the speeches are bagging Labor. Very little in terms of plans for the economy, and we're going to turn that around. We can't wait another 3 years for the next election. We need the Government to be implementing a fiscal plan now. Business leaders, The Reserve Bank, everyone is crying out for some direction and they're simply not getting it from Scott Morrison or from Josh Frydenberg.
GILBERT: From one end of the income spectrum to the other I want to ask you about Newstart, because most economists say if you want a stimulus to the economy that's the best way. How soon should Labor articulate that you support an increase immediately and by what quantum?Surely that needs to be a priority for you.
JONES: We have indicated that we believe Newstart needs to be increased. We've said that.
GILBERT: But not by how much.
JONES: We’re on the hook for an increase to Newstart, but what we haven't set out and this is all about ensuring that we've got the revenue to pay for this. This is all about ensuring that all of our promises are going to be affordable. So will be consulting with the welfare groups, with ACOS and others, and we’ll be consulting with business. But we do believe that 280 dollars a week is simply not enough to be living on, and we believe that actually a boost to Newstart, an immediate boost to Newstart would be an economic stimulus because the lowest income earners, every money that they have in their pocket is going to find its way back into the economy in the way of paying for essentials. So we think it’s actually good economic sense to be doing this.
GILBERT: Should it have been a stronger position from Labor on that issue at the last election in your view, because it seemed to be low-hanging fruit so to speak for Labor, that it's an economic boost, but also an equitable one?
JONES: We indicated that we wanted a review of the Newstart,.
GILBERT: It was pretty weak a recent review, only.
JONES: Well, we wouldn't have reviewed it if we thought it was right the way it was. We wouldn't have reviewed it if we thought it needed to be decreased. We want to increase Newstart and to ensure that whatever we do is affordable. As I said, we've already got 95 billion dollars worth of unfunded tax cuts legislated for in this budget, in the current budget. So we need to ensure that whatever we do on Newstart is going to be affordable. But we agree with business, we agree with community organisations that 280 dollars a week is not enough to live on, and that every dollar that you put into boosting Newstart, is going to be a boost to the economy as well.
GILBERT: Okay, I want to ask you about the Liberals being blocked from visiting China, Andrew Hastie and James Patterson. China says that they must repent and redress their mistakes before they are granted visas. This seems like quite a an ideological divide right now between the authorities in China and some members of our own Parliament. What do you make of this latest development?
JONES: I personally don't believe that anything is going to be gained between our two countries if we just pull down the shutters. I think because of the mismanagement of this Government, we've got relations with China probably an all-time low, but I don't think anybody is going to gain if we just pull down the shutters and we break off those person-to-person, parliamentarian to parliamentarian, business-to-business relationships and those communications. I think a lot more is going to be gained if you've got people going, who have made quite frankly got some concern with policies of the Chinese Government. I think there's actually more to be gained by improving their awareness and getting them over there having a look at what's going on, on the ground and engaging it in a two-way dialogue at every level. So I think it's a bit unfortunate.
GILBERT: I think they’ve misread Andrew Hastie haven't they, if they think he's going to repent and redress? He's a very strong critic. He's not going to change his tack because of statement from the embassy.
JONES: I've got to say, I think there's a lot to be gained on both sides if we have more parliamentarians, more business people more citizens interacting exchanging, visiting each other's countries and trying to get a better understanding of what's going on in each other's economies in each other's political systems. I think much more can be gained by that and that's why I think probably a bit unfortunate that these two, who I fundamentally disagree with on so many things, aren't going to be going to be going to China to be increasing their knowledge of the place and increasing the dialogue.
GILBERT: And they're hardly going to be feeling too much pressure to change their view. We do live in a society of free speech.
JONES: Look to your point Kieran, I don't think if the purpose behind this is to try and change their minds or change the things that they're likely to say. I rather suspect that it's going to have the opposite impact knowing those two people. Probably playing it their hands more than the other way.
GILBERT: Let's look at the Bellamy's sale. It was cleared by Josh Frydenberg after approval from FIRB, the Foreign Investment Review Board. What's Labor's position, given the Foreign Investment Board found it was in the national interest to allow this approval.
JONES: To the greatest extent possible, I don't think we should be politicising these sort of decisions. Some of the conditions did look unusual, I've got to say, and I think it would be helpful if the Treasurer of the Government could explain all of the elements and set out why they believe those conditions were in the national interest that this sale go ahead. But I've got to say greater bilateral investment between Australians in China and Chinese companies in Australia, I think by and large grows both of our economies, and it should be something that we are supporting. If there is a national interest or a national security concern about that, that's FIRB’s job to do the detailed analysis and ensure that they've got it right. Like I said, I think there are some unusual conditions that have been placed on this one. I think it's incumbent on the Treasurer and the Government to come out and explain why those conditions were put in place.
GILBERT: A couple of quick ones to finish on the climate change debate, both Labor and the Liberal Party quite sober in terms of the language in the last week or so as we've faced this crisis. Is this a window potentially where the parties might once and for all be able to work together and responding to matters like this?
JONES: I'd like to think so. I've got to say there were some elements in the political class who let themselves down this week. I'd like to see us focusing on climate change. I don't think we need to turn it into a battle between doing something on climate change and doing something about jobs because as Anthony Albanese set out in his speech in Perth a few weeks ago, we can actually do both if we're investing in renewable energy technologies, renewable energy generation. There is actually a lot of steel and a lot of jobs in those sorts of investments. I'd like to see the final couple of weeks of parliament and the final couple of months of this year herald in a bit of a reflection on the way we are dealing with this issue. If you talk to the firies on the front line, they get the fact that they got an emergency to deal with, but they also get the fact that our climate is changing. That it's impacting our weather patterns and it's making their jobs as frontline defenders and frontline firefighters, all the more difficult. So we've got to act in Australia. We've got to act with the community of nations to ensure that we are doing something to reduce our carbon emissions, to transform our economy and ensure that year after year we are not facing the sort of natural disasters that we are at the moment.
GILBERT: Just quickly, finally, the Deputy Leader faced a mass walkout at the ALP Victoria conference. It’s unions not happy about the Setka treatment or the free trade agreements. It's not really a happy family right now the ALP, certainly not in Victoria.
JONES: I'm tempted to say Kieran, that you haven't been a Leader or a Deputy Leader of our Party unless you face to walk out somewhere, particularly in Victoria. I can say that as a New South Welshman, but frankly, obviously there's a bit of concern about the strong action Anthony Albanese has taken about having John Setka removed from the party. He's made it quite clear the reasons why he's done that, by both his statements, his values and his behaviour. John Setka’s values are not compatible with those of the Labor party. Sure that's ruffled a few feathers. We expected that to happen, but you can't be a strong leader without offending a few people and that's exactly what Anthony's done
GILBERT: Stephen Jones. Appreciate your time this Sunday.