12 February 2015
Transcript - #2015023, 2015

Interview with David Koch, Sunrise

DAVID KOCH:

We are joined by Treasurer, Joe Hockey. Morning to you Joe. Before we start, how do you bring confidence back into you as a Treasurer?

TREASURER:

Well Kochie, get on with the job. I think that's really important. Yesterday, the Prime Minister and I announced a major initiative in relation to foreign investment screening on agricultural land. I’ve also flagged we are going to say more about foreign investment in residential real estate, which is a big issue for probably many of your viewers. We’re also going to roll out a plan that delivers tax breaks to small business, provides incentives for people to create more jobs, getting on with infrastructure, building opportunities, and opening up new free-trade agreements….

DAVID KOCH:

Okay, all right. Ian Narev, the boss of the Commonwealth Bank, yesterday said we don't have a coherent policy picture of the job creation environment that’s going to give business the confidence to borrow and create more jobs. And then overnight, the Council on Foreign Relations in America has voted Tony Abbott the most incompetent leader of any industrialised democracy.

TREASURER:

Who did? What agency was that?

DAVID KOCH:

The Council on Foreign Relations in the United States.

TREASURER:

Yeah, okay. Well, look…

DAVID KOCH:

There is a crisis in confidence in your ability and also Tony Abbott's ability to do anything.

TREASURER:

Well, you know, it is a difficult time to govern when a Labor-controlled Senate is blocking everything, including what the Labor Party promised at the last election to fix the Budget. So, it’s a difficult time, Kochie, but we are determined to keep going. Last year, we saw three times the number of jobs created each day as were created the previous year. Last year, we saw a record number of small businesses start up. We’ve seen interest rates come down. We’ve seen – and this is not a direct result of our action, but it’s helped families a lot to have petrol prices come down. We got rid of the Carbon Tax, which has reduced household electricity bills by $550. We are getting on the job but we are facing headwinds.

DAVID KOCH:

Okay but there’s a confused message. Let's take a look at the next Budget: Tony Abbott says he is listening and going to go soft. You say you’ve got to keep cutting otherwise we won't get a Budget surplus. So, you have the Prime Minister saying, ‘oh, we're going to be all touchy feely and go soft, and we are not going to be as hard, we are listening to you’. And then you say, ‘we’re going to keep cutting otherwise you’re not going to get a Budget surplus’.

TREASURER:

Kochie, I don't think he said ‘touchy feely’. I think what he said…

DAVID KOCH:

No, I just interpreted that [inaudible].

TREASURER:

I think they’re your words. But you know, currently we are spending $100 million a day more than we collect in tax. Now, as you know, and all of your viewers know, you just can't keep going on forever…

DAVID KOCH:

Exactly right. You can do two things; you can cut, cut, cut, like Greece and go austerity, or you can grow the business, grow the economy and bring in more revenue.

TREASURER:

Well, if Greece had of made prudent savings some years ago, they wouldn't be in the mess they’re in today. The same with Italy. The same with a whole lot of European countries. If they had of made the difficult but necessary decisions years ago, they wouldn't be in the mess they’re in today with massive unemployment and social unrest.

DAVID KOCH:

Okay.

TREASURER:

Now, what you've got to do is live within your means, Kochie.

DAVID KOCH:

Yeah, sure.

TREASURER:

And $100 million – it is impossible to keep borrowing $100 million a day just to pay the daily bills, which is what we’re doing.

DAVID KOCH:

Yeah.

TREASURER:

So, you know, we have got to continue to make prudent savings but at the same time, focus on the massive opportunities Australia has going forward.

DAVID KOCH:

Sure. And when you've got a two per cent 10 year bond rate – great opportunity for governments to borrow more and spend on infrastructure; create jobs.

TREASURER:

We are. We have got the biggest infrastructure rollout in Australia's history; the equivalent of eight Snowy Mountain schemes over the next decade. That is being rolled out. But Kochie, anything you borrow today, you have to pay back.

DAVID KOCH:

Oh, yeah.

TREASURER:

And the fact – you know, this idea that you can just borrow and borrow is unsustainable because…

DAVID KOCH:

[Inaudible]

TREASURER:

…At the moment, we are borrowing just to pay the daily bills.

DAVID KOCH:

Agree on that. All right mate, good to see you. Here’s Sam.

TREASURER:

You’re looking good. See you.