Wed, 14th May 2008

Turnbull interview (3AW) - Budget

The Hon Malcolm Turnbull MP
Shadow Treasurer

E&OE

MITCHELL:

On the line is Shadow Treasurer, Malcolm Turnbull. Good morning.

SHADOW TREASURER:

Good morning Neil.

MITCHELL:

Anything good in it?

SHADOW TREASURER:

Oh there are plenty of good things in every budget. What’s bad about it is that it doesn’t provide a clear direction for Australia’s future. It doesn’t have any economic strategy. We were told it was going to be a tough budget, a painful budget, that would put downward pressure on inflation but in fact he’s increased spending and he’s increased taxes.

MITCHELL:

Do you agree with the means testing as introduced at basically $150,000 combined income?

SHADOW TREASURER:

I agree with means testing generally for social welfare benefits and payments and I think most people would agree with the means testing for the Family Tax Benefit B. The area I do disagree with is on the baby bonus. We had a view in Government that this was a payment that was designed not just to help mothers with new babies, and obviously multimillionaires don’t need that help, plainly. But it was designed to send a very strong social message which was going to be more powerful if it was universal. Now what they’ve done there is introduced a means test which says that if you earn the six months, if your household earns, the six months after your baby, $1 more than $75,000 you don’t get any part, not even a fraction of the baby bonus. So it’s a very crude means test. I don’t think people in those circumstances regard themselves as multimillionaires, or ‘the rich’, but that’s where they’ve set it and it will save very little money in the scheme of the budget. Very, very little money, but it’s designed to make a political us-and-them point. It’s Labor playing that, you know, wedge politics, the politics of envy, and that’s the political decision not an economic one.

MITCHELL:

Are these broken promises? This Prime Minister, on the 15th November last year during the campaign when I asked him: (previous recording)

MITCHELL:

“Will the baby bonus survive under you?”

KEVIN RUDD:

“Absolutely.”

SHADOW TREASURER:

Well he’s either broken the promise completely or he would say, or he’s a person who uses language in such a slippery way that you cannot take his word unless you pin him down in triplicate. Now, either way, it’s not a very trustworthy approach to have from your Prime Minister.

MITCHELL:

What do you think will happen to interest rates? Is this going to ease the pressure or intensify it?

SHADOW TREASURER:

It will have a mild stimulatory effect. What that means is it will put upward pressure on inflation, not in a big way, but it is not an inflation-fighting budget. I think the assessment of most of the economists has been that, that it is a stimulatory effect overall, and it is the complete reverse of what Wayne Swan said he was going to deliver. So it does not make the Reserve Bank’s job any easier. It makes it harder and I just cannot understand, Neil, what was Wayne Swan doing all those months saying he was going to cut spending?

MITCHELL:

Pensioners. How do they end up?

SHADOW TREASURER:

Well they end up with nothing. I’ve just got an e-mail here from a couple in Tweed Heads, who said “My wife has a small super pension and I get a partial disability pension, giving us a combined income of $25,000. There is nothing in this budget for us. Please thank Wayne Swan for giving us absolutely nothing”.

MITCHELL:

But don’t they get a $500 one-off payment?

SHADOW TREASURER:

Well they get that, but that’s only courtesy of the Opposition because we jumped up and down and pressured the Government to put that in. that was one of our policies.

MITCHELL:

Yeah but it’s a bit of rough to say they don’t get anything. They get a little.

SHADOW TREASURER:

Well that’s true, they get that little bit. Yep that’s right.

MITCHELL:

Okay, is this budget dependent on wage restraint, because it’s a pretty ordinary outlook for employment isn’t it?

SHADOW TREASURER:

Well it is a very ordinary outlook for employment. The fact is there is a 134,000 people that are going to lose their jobs if the forecasts are right. I noticed the Prime Minister described that as being a “modest increase” in employment. Well, if you’re one of those 134,000 people who are going to lose their jobs, I don’t think you’d regard it as being modest.

MITCHELL:

We’ve had quite some debate about the alcopops. Now I debated this with the Prime Minister about its success but it does look on the figures as they’re actually on the revenue figures, they’re expecting perhaps even an increase in the amount of these things drunk.

SHADOW TREASURER:

Well there’s no question about that. That’s exactly what they’re expecting. The revenues from the alcopops tax are going to increase rapidly from 628 million next year to 880 million three years later. So that assumes more people are going to be drinking these drinks but it looks like Wayne Swan’s revenue forecasts are actually based on the assumption that binge drinking is going to become greater.

MITCHELL:

Okay. Have you got Peter Costello’s view on this yet?

SHADOW TREASURER:

Ah, well Peter and I talk a lot but I’m sure he would be happy to share his views with you directly.

MITCHELL:

Is this your last budget as Shadow Treasurer?

SHADOW TREASURER:

Well we’ll see. I’m very committed to the job I’ve got and am enjoying it very much.

MITCHELL:

I hear you might be in a change of job about August or September, is that possible?

SHADOW TREASURER:

Neil, you know, these are what I call the inevitable questions to which I give the inevitable answers, which is not to answer them at all. No. Not on the leadership.

MITCHELL:

The inevitable answer is no comment?

SHADOW TREASURER:

The inevitable answer is I don’t comment on the leadership, yep.

MITCHELL:

Thank you very much for your time, the Opposition Shadow Treasurer.