PRIME MINISTER:

Well how’s that, a family owned business, started in 1899 making mattresses. Originally with straw then they moved on to horse hair and now you see the technology and the micro coils and they’re selling Australian mattresses made here, Australian artisans, Australian technology and selling them into China into the biggest market in the world. A little while ago, a container every three months. Now there is a container ever three days. This company did not export before.

Now thanks to the big open markets that we have made available to Australian manufacturers, to Australian exporters of every kind, they have 3 per cent of their sales going to China and it's growing as the Chief Executive said exponentially. What does that mean? That means more growth and more jobs right here in Australia. Growth and jobs, powered by our economic plan; one of the key pillars of which is our trade export deals.

Here it is happening right here around us; more jobs, more growth, more opportunities. And of course it's powered by innovation. You don't have to be a brilliant software engineer in a t-shirt to be innovative. Here you have brilliant designers, brilliant embroiderers, brilliant engineers here in a traditional business that are coming up with the best products in the world. They can go into the Chinese market and sell an Australian mattress for $75,000. Think of that. But the premium brand value that involves, the technology that involves, the innovation, the Australian creativity that that involves.

Australians can do anything including selling mattresses into the Chinese market. More jobs more growth. That's our national economic plan and this business is a family business. Most small and medium businesses are family businesses, overwhelmingly family businesses. Those small and medium businesses are the ones that benefit from our business tax cuts. Beginning as you know over the next three years, but next year with companies with $10 million turn over, then 25, then 50, then 100, then 250 and so on until 11 years from now every company will be paying 25 per cent tax.

But over the next three years the companies that will get the benefit will be small and medium family businesses Australian-owned overwhelmingly. Businesses like this that are challenging the orthodoxies about what Australians can do, breaking open those big opportunities that we've made available through our trade export deals and delivering what we need to secure our future, which is jobs and growth.

I'm delighted to be here with David Coleman, the local Member, my colleague. I'm delighted to be here with Paul the CEO and the Beard family. We share their pride at a business that started in 1899 and is here getting stronger than ever.

I don't think the founders, your forebears, I don't think the founders of your business would have ever imagined they’d be selling mattresses to China, but here you are. You're doing it because you're smart, you're courageous, you're a strong family business, you’re investing in your own business in your own people and you’re forging ahead and securing our and Australia’s future, and we applaud you for that.

JOURNALIST:

Can I just ask on this business, has this business benefited from the China Free Trade Agreement and was there a tariff on mattresses that has been removed?

PRIME MINISTER:

There is. It's coming down. In fact it's coming down to zero by 2019. So it is - the mattress tariff is reducing and it's reducing from the outset. It started off at 19 per cent it’s coming down to zero. That obviously makes the AH Beard Mattresses more competitive in that market.

JOURNALIST:

Prime Minister on superannuation changes yesterday your Cabinet Secretary Arthur Sinodinos said if you win the election there will be consultation on various changes. Will there be any changes to your superannuation policy either before or after the election?

PRIME MINISTER:

No, well as I've made it clear there will be no changes to the policy. It's set out in the budget and that is the Government's policy. What Arthur was referring to was that there is always consultation about the details of the drafting, and what I think Mathias Cormann called the administrative implementation. But the policy, the substance of it, the economic substance of it, that is all settled, that's in the budget and that's our policy.

JOURNALIST:

Prime Minister accounting groups and seniors groups have argued that you and the Productivity Commission have underestimated how many people will be affected by your super changes. Can you guarantee that they are wrong, and if not, does it at least show there is confusion over the policy?

PRIME MINISTER:

Well nobody knows more about your super than the Australian Taxation Office. They may well know more about your superannuation filings than you do. The figures that have been - that we've used, which is to say that 96 per cent of people in the super system will either be better off or unaffected by the changes - those figures come from the Australian Taxation Office and are verified by the Treasury. So that is - nobody has better data than the taxation office.

JOURNALIST:

What do you say about research, that people who planned their retirement thinking they could keep investing their after-tax money this way and now those plans are ruined?

PRIME MINISTER:

Can I say to you that the very few people have invested in after tax income into super since 2007 more than $500,000 and their average superannuation account balance is $2 million. Look let me - let's cut to the chase here. I think it’s very important that we speak very, very plainly about this. Our plans, our proposal, our budget makes superannuation fairer and more flexible. As a consequence of our changes, people who are earning $37,000 or less will pay no tax on their superannuation contribution. People who are out of the workforce will be able to catch up five years of unused concessional contributions - $25,000 a year. These are taxed at 15 per cent only. They will be able to catch up and use them when they come back in the workforce. That is overwhelmingly women. Again that's good for women. Independent contractors will be able to contribute to super on the same basis as people who are employees and older Australians who keep working after they are 65 will be able to continue contributing. So those are all very positive changes that make the super system fairer.

Now it is true that some people around 4 per cent, on high incomes and with high superannuation balances will have to pay some more tax on their superannuation account - in the sense they will pay the 15 per cent tax whereas previously they were paying nothing. So if you have someone who has $10 million in their superannuation account in retirement, currently they are not paying any tax at all on the earnings from that. No tax at all. Under our changes, they will have no tax on the earnings of $1.6 million and on the balance they will pay 15 per cent right? 15 per cent remains a very concessional tax rate. That is less tax than a kid pays on his marginal income stacking shelves at Woollies.

Let's get real about this. Nobody likes paying more tax. Super has been an extremely generous system. It remains a very generous tax advantaged system. That hasn't changed. For people on very high incomes and people with very large balances, it is not quite as generous as it used to be and they are being required to pay some tax. But 15 per cent is a lower rate of tax than any of you pay - any Australians pay on their own personal income. So it remains a very generous system.

JOURNALIST:

Prime Minister briefly this morning your Treasurer said that Labor was using taxes as bullets. You have called for moderation in language from MPs before. Is it possible that people who have faced real bullets might find the Treasurer's language inappropriate?

PRIME MINISTER:

Let me say this to you. Bill Shorten has declared war on business. He's declared war on the family businesses of Australia. He is denying them the tax relief that in the past he himself has said they deserve. And in the past Labor governments have delivered. This is a change this is a dramatic move to the left. This is the most anti-business Labor leader we have seen in a very long time. He's more anti-business than even he used to be in the past. Now the reality is that Bill Shorten has declared war on business and the first casualties are jobs. The first casualties of Shorten's war on business are Australian jobs.

JOURNALIST:

Would you use those words Prime Minister?

PRIME MINISTER:

You have just heard me use them. It is a fact. He has declared war on business.

JOURNALIST:

In your opening spiel Prime Minister you mentioned technology, you mentioned the factory founders, you mentioned the exporters - you didn't mention the workers that are working here now.

PRIME MINISTER:

There are 380 workers here.

JOURNALIST:

The owner’s getting a tax break. Chances are they are not. What do you say to them?

PRIME MINISTER:

What I say to all of the workers here and I want to applaud them for the great work they do. As you know we have been talking to some of the team here on the way through and in fact Neville is one of the - there he is Neville, Neville was stitching one of the beautiful mattresses there - Neville with his handsome white beard has become a household figure in China. He's become so well-known through the publicity for the AH Beard products. Next time I go to Beijing I will be able to say people I know Neville from AH Beard with his own magnificent beard. The workers, the employees of this company and every company are the primary beneficiaries of a cut in company tax. That is very clear.

What happens is when you reduce the tax on businesses, companies in this case, the company has more, it retains more of its earnings which it invests. This company is like so many other family businesses. Its capital is its retained earnings. So over the years if it can pay a lower rate of tax it has more to invest, it invests more, it expands. When it expands it employs more people.

That is why when the Treasury looked at this last year - and I can tell you every study has come to the same conclusion over many years - that is why what I'm saying to you until recently would have been regarded as absolute orthodoxy. What happens is that when you reduce company tax by a dollar you increase the value of GDP by $4. Most of that between two-thirds and three quarters goes to labour, that is to say, goes to employees of whom more are hired and more are rewarded because the company does better.

That is why other countries have cut company tax. That's why we cut company tax to 30 per cent because we weren't competitive with the rest of the world. That is why we need to reduce it again although over a very long glide path. Mr Shorten goes on about the banks. The banks will be waiting eight years before they get a tax cut. There are three federal elections between now and when the biggest companies would get a tax cut. This has been very carefully calibrated, so that the benefits go to the smaller businesses first because they will react, they will respond more quickly and they are overwhelmingly Australian family-owned businesses.

JOURNALIST:

Mr Turnbull can I ask just on superannuation. Isn't consultation without any capacity to change, tokenism? Don't your MPs have a right to feel, given they listened to the Cabinet Secretary and the Trade Minister and heard both suggest consultation, and they are not going to get any capacity to change, don't they have a right to feel miffed with you?

PRIME MINISTER:

No Tim with great respect, you are confusing two different things. Governments, my Government, previous governments, regularly announce changes to taxation, announce a changed taxation measure and then consult, typically with the accountants and lawyers about the precise legislative language to achieve that objective. What we have set out is what we are going to do. Then obviously in terms of the drafting, there is consultation with the industry. But the substance, the import, the object of the reforms that we have set out in the budget are there and they are not going to be changed. They are fair. Yes I know, I understand that some people with very large superannuation balances will have to pay a little more tax. Some people on very high incomes will not get as much of a tax shelter out of super as they did. But they are still getting a very good deal. It is still at 15 per cent. You are paying less tax on superannuation earnings than somebody pays on the lowest income tax bracket, 19 per cent. So you have got people on well below average full-time earnings, who are paying more tax, much more tax than 15 per cent, even on an average basis.

So we've got to get real about this. That is why yes, there is about 4 percent that are going to have to pay a bit more tax. I can understand their disappointment. But my role, my job is it to govern for all Australians. My job is to make the superannuation system fairer, more flexible, better for women, fairer for older people, fairer for people who are self- employed, fairer for people on the very lowest incomes. That's what we've done. I’m proud of these changes. They are important. They are important to make our system sustainable and they have enabled us to do a better job for the people that need the most help.

JOURNALIST:

[Inaudible] would it have been appropriate for you both to have attended the repatriation ceremony?

PRIME MINISTER:

Thank you. It's a very solemn moment. It's the largest, as you know, a very large repatriation of remains of former servicemen and their families. The Governor General is representing the Commonwealth as our Head of State and the Defence Minister and Minister for Veterans' Affairs and their shadow counterparts are there as well. That is an appropriate and very dignified and respectful representation of the nation, as we bring the remains of those who served our nation bravely, home. Thank you very much. Thank you.