13 February 2015
Transcript - #2015025, 2015

Doorstop interview

TREASURER:

[Inaudible] I am here with Nickolas Varvaris, the Federal member who previously was a local mayor and is very much in touch with this community. A great economic story in the last 12 months has been the record number of small businesses started in Australia. Over 200,000 new businesses have been registered and there is huge opportunity for more jobs in small business, but what we have got to do is make it easier and not harder for those small businesses to flourish. That’s why, this year we are focused on providing a tax break to small business, but at the same time, ensuring that we continue with our deregulation process where we have already removed 17,000 pages of red-tape for businesses so that they can get on with the job of making money and employing more people.

This year’s Budget will be focused obviously on jobs, growth and opportunity and the jobs come about because you reduce the overall tax burden but at the same time, you free up opportunities for people to develop and grow their own businesses. Now, we are absolutely determined to continue to head towards a point where the government can live within its means; where it can get back to surplus, and yes we have to reduce overall spending, but it does not mean that we are not in a position to reprioritise spending to focus on growth and to focus on providing more opportunities, particularly in small business, to employ more Australians.

Even though we’ve been running job growth at three times the speed that it was when we came to government – so last year, 600 jobs a day on average created in Australia, compared to 200 under Labor, there is still much work to be done. If we had remained on Labor’s trajectory, unemployment today would be 7.5 per cent, instead of 6.4 per cent. So, even though we’ve made good progress, there is much work to be done. Ultimately, if the government can start to live within its means, ultimately, if the government stops spending $100 million a day more than it collects, and ultimately, if we can re-prioritise government spending to focus on growth and opportunity, then we are going to see more jobs created and a more prosperous Australia.

REPORTER:

Glenn Stevens is painting a pretty negative picture of the economy overall; do you take responsibility for that?

TREASURER:

We all collectively accept responsibility for the economy. Given that there have been significant downgrades in economic growth around the world in the last 18 months, given that our biggest export, iron ore, has fallen from around over $90 a tonne to around $60 a tonne, given that we have had significant external headwinds, and given that we have a Labor-controlled Senate, we’ve actually made very significant progress and more can be done.

REPORTER:

Is it possible we could be $1 trillion in debt by 2037 if savings aren’t made?

TREASURER:

Absolutely. Australia imports money to fund its lifestyle from the rest of the world and we can’t continue to have a government that spends $100 million every day more than it collects in revenue because if the government is borrowing to fund that extra expenditure, sooner or later the debt does increase and increase, to the point where you are facing $1 trillion of debt. Now, we have laid down a plan to address this. We have laid down a plan that helps to reduce expenditure, that reduces our borrowings every day and eventually gets us to the point where we can start to pay off the debt rather than increase it.

REPORTER:

There’s a report this morning that the Budget measures introduced – the cuts introduced by the Government – [inaudible] will be the ones that haven’t passed the Senate, haven’t actually offset the Government’s expenditure. How exactly are you going to make cuts this year and into the future in this kind of environment? Where should the community expect those cuts from if [inaudible] are off limits?

TREASURER:

I would expect that the Labor-controlled Senate would work with us to try and fix the mess that we inherited. Now, we have laid down a credible plan. We have reduced the trajectory of debt. It is currently – or when we came in – the trajectory was $667 billion. In our first Budget that fell by over $300 billion. So, we did make significant steps forward and a number of measures have passed the Senate already. Having said that, because of falling revenues as revealed in the Mid-Year Economic and Fiscal Outlook, and as I said, because of falling iron ore prices, we have not been able to keep our $300 billion reduction in forecast debt. It is now significantly less than that but still, we are getting the debt trajectory down. There’s still much work to be done and in the areas of high-spending growth such as health, we need to ensure that the system is sustainable. We are asking Australians to make a contribution along the way so we can make sure that we can afford quality healthcare that we have today, into the future.

REPORTER:

When are you going to lower unemployment?

TREASURER:

We, for a start, have rolled out the biggest infrastructure program in Australia’s history and I am unbelievably disappointed that the new Labor Government in Victoria has just torn up contracts for East West Tunnel project, which would represent 7,000 new jobs in Melbourne – 7,000 new jobs. So, we’re rolling out the infrastructure; Labor is destroying the infrastructure and it’s costing jobs. Having said that, where Labor is not having a dead hand on infrastructure, we actually have the opportunity to do more and we will continue to look at new infrastructure projects that create jobs and build productivity.

REPORTER:

Do you accept that the Government’s Budget cuts introduced so far have not contributed to reducing the debt?

TREASURER:

No, that’s just not right. The deficit would have been far larger had we not had the reduction in expenditure overall. The trajectory for spending growth was around 3.6 per cent that we inherited. We’ve got it to less than one per cent and there’s still much work to be done – I freely admit that, and the Prime Minister has said that as well but if our political opponents have no policies and they’re not prepared to support what we do, it makes it much harder. I will just say to Mr Shorten, join us on the journey of fixing the mess that was created by the previous Government and then we never need to talk about having debt towards $1 trillion.

REPORTER:

What did you make of Tony Abbott’s holocaust comment in Parliament yesterday?

TREASURER:

Look, he regretted it. I’ll tell you what, when you are standing at the dispatch box and the people opposite are you are screaming hysterically, it is very hard to keep your words in check. Having said that, the Prime Minister apologised immediately and look, we move on.

REPORTER:

Are you concerned by reports that at least half a dozen Coalition Senators will vote against the softening of the bail laws?

TREASURER:

I haven’t heard that. Thanks very much.