Interview with David Penberthy and Will Goodings, 1395 FiveAA Adelaide, South Australia

 

DAVID PENBERTHY:

Malcolm Turnbull, are you there PM?

PRIME MINISTER:

I am indeed, great to be with you, great to be in Adelaide.

DAVID PENBERTHY:

Good to have you back in Adelaide. Good to have you back on our show.

So Mr Turnbull there was a poll out the other day and it reflects what all the major parties have been saying here, there is a massive 40 percent of South Australians who do not intend to vote for either of the major parties on July 2. What is your message to those people?

PRIME MINSTER:

Well, this is a very important choice for all Australians and South Australians especially. The choice on July the 2nd is whether to vote for the Coalition, for the Liberal Party and ensure that we have continued stable government and the delivery of our national economic plan which will deliver jobs and growth or whether we go back to the chaos of a Labor-Greens-Independent alliance with all of the uncertainties and the economic disaster and debt that had attending on it when it was last in operation under Prime Minister Gillard.

DAVID PENBERTHY:

Would you go so far as Christopher Pyne and Simon Birmingham did on our show this week where they said directly to people who aren’t going to vote Liberal, they should then vote Labor instead?

PRIME MINISTER:

I am encouraging everybody to vote Liberal. I am the leader of the Liberal Party. The critical issue here David is that only the Coalition, only my Government can be trusted to deliver for South Australia. I mean let’s look at the big defence expenditure for example – the big ship building contracts here, the Future Frigates and of course the submarines. We know, you know, Labor says that they support it right? That’s fine, they can say that. But let’s look at their track record. In six years of government they did not commission one Australian naval ship from one Australian yard. We have commissioned and are in the process of commissioning 53 and the bulk of that expenditure, the overwhelming bulk of it in fact, all the major ships are being built here in South Australia. In government, Labor pulled $18.8 billion out of the Defence budget. Why does anyone imagine they wouldn’t do it again? Defence is not a priority for them. Shipbuilding is not a priority for them. They’ve got other things they want to do. They’ve got things the unions will demand.

WILL GOODINGS:

Sure, but Prime Minister it does sound like this is a different message to what Christopher Pyne told us during the week. He was very clear about the point that it was preferable for South Australian voters, we asked specifically about South Australia where Nick Xenophon is polling extraordinary numbers at the moment, about whether he would prefer those people that under no circumstance will vote for the Coalition, where would he like to see their votes go? He was very clear in saying he’d prefer it go to Labor than the Nick Xenophon team. Are you in agreement with him?

PRIME MINISTER:

I am in agreement with Christopher Pyne on that. But can I just say to you my call is to South Australians whether they are, whatever they are thinking of doing, whoever they are thinking of voting for today, my call to them is to vote for the Government. Vote for my Government that they know will deliver continued stable economic leadership, that will deliver the jobs and growth that are so important for South Australia and can be counted on to deliver the major investment in defence here in this state that is going to be so important. This state will become the centre of advanced manufacturing in Australia. These projects are the most cutting edge, technologically advanced defence projects in the world. They will be undertaken here in South Australia. There will be companies contributing to them from right across Australia of course. Not only in South Australia, but the construction will be here. This will be the epicentre of the naval shipbuilding effort. This is an enormous opportunity, we’ve brought that, we’ve made those decisions, we’ve made those choices. Labor did nothing in six years and they cannot be trusted to deliver for South Australia.

As for Mr Xenophon, with great respect to him, as an Independent, what is he able to deliver? Seriously, what is he able to deliver as part of presumably some Julia Gillard revisited chaotic unstable Labor-Green-Independent alliance? We’ve seen that film before and it wasn’t pretty.

DAVID PENBERTHY:

PM the feedback we have been getting from voters today in the Brickworks shopping centre in Adelaide’s western suburbs is that there’s still a lot of anxiety about jobs and job security here in South Australia. Is the big challenge for you in the remaining four weeks to explain it at the sort of everyman level how a corporate tax cut is actually going to trickle down and create better job opportunities for people in South Australia?

PRIME MINISTER:

Well David, there is no question if you lower taxes on business - and remember what we are doing is lowering taxes on small and medium business this year, this coming year beginning July 1, the tax rate will come down to 27.5 percent for businesses with turnovers of not more than $10 million. The next year it’s 25, the next year it’s 50 and then there will be an election. The next year it’s 100 after that, 250 and so on. The big companies, the biggest companies, will get a tax cut in 8 years, after three elections. All companies will be paying, the rate will then come down over three years to 25 percent, after another, so that’s eleven years. But in the next three years, the big benefits go to those companies, those small companies I would say, small and medium sized companies. They employ hundreds of thousands of people across Australia. I mean if you just look at the companies that will get the tax cut next financial year starting July 1, in South Australia those companies which between $2 million and $10 million dollars - and Labor opposes any tax relief for companies with revenues of more than $ 2 million - those companies with revenues between $2 million and $10 million next year will get a tax cut if we’re re-elected. They employ 68,000 people in South Australia alone. That’s 9 percent of all private sector employees in this state.

DAVID PENBERTHY:

A lot of businesses tell us PM that the thing that drives them particularly mad is state based taxation, things such as payroll tax and that they regret that you didn’t end up going for a much more ambitious overhaul of the tax system possibly including an increase of the GST so that those really punishing state taxes could have been abolished. Do you think that you will revisit the GST question in your next term of government?

PRIME MINISTER:

No I don’t David. We won’t and I can explain why. Labor’s running a scare campaign about GST, we looked at GST.

WILL GOODINGS:

Not this state - they support it.

[Laughter]

PRIME MINISTER:

I know. That’s true. Jay Weatherill did. A lot of people supported raising the GST so long as they got proceeds. There were more people seeking the proceeds then there was revenue raised by any such increase.

But here’s the problem in a nutshell; if you increase the GST by 5 per cent as was proposed by many people, including Labor leaders, you raise about an additional $30 billion. But then, by the time you ensure that people in the lower income groups, lower income quartiles- quintiles I should say, so the lower 40 per cent of household income, by the time they are made good, that’s to say they are no worse off, the amount of money you have left for tax cuts, whether it’s at state level or federal level or corporate level is relatively small.

DAVID PENBERTHY:

So to quote a great man, are you saying that the GST is dead? Never ever?

PRIME MINISTER:

What I am saying is – well yes. It is not something that we would contemplate in the next term of government. It’s the type of reform that no government I believe, certainly no government I lead, would undertake other than with a very clear election mandate to do so. We have looked at it as we should have because it was put on the agenda by many other people. It would have been I think unrealistic not to examine it. We have looked at it and we concluded it wasn’t a viable proposition. It wasn’t able to deliver enough additional revenue in a fair way, to justify it. So that’s why we are not doing it. We didn’t kick it into the long grass for political reasons. We decided not to proceed with it on very sound economic ground.

What we do have is a set of tax reforms that we know will drive additional jobs and growth because when you lower the tax on companies and look Paul Keating used to say this, Bob Hawke used to say this, Bill Shorten even as we saw last night used to say this a few years ago. We all know you lower the tax on businesses they retain more of their earnings, they invest more, and as they invest more they employ more. That’s why the economists will tell you that a cut in company tax sees most of the benefit going to labour, that is to say to employees.

WILL GOODINGS:

Prime Minister, your superannuation policy has led to some ructions within the Party and within the traditional Liberal voter base. Can you foresee any circumstance in which the policy as detailed in the May 3 budget will change following the election? Is it ironclad?

PRIME MINISTER:

It is absolutely ironclad. Yes, the commitment that we have made in the budget are our policy. If we are returned we’ll implement those policies. I believe they are fair. They make the super system, more flexible and more sustainable. The big beneficiaries are people on lower incomes earning up to $37,000 who won’t pay tax on their super, women who are out - this applies to men of course but it mostly applies to women in practise - people who are out of the workforce for up to five years, they can roll over their concessional entitlements, concessional contribution caps if you like, and double up on them for five years to catch up. That’s good for flexibility, particularly good for women. Older people who currently can’t contribute to super on a concessional basis after 65 will be able to now, until they’re 75 because obviously many people in that age bracket continue to work. Independent contractors will be able to contribute in the same way that employees can. So that’s made it a much fairer, and more flexible, and sustainable system.

DAVID PENBERTHY:

Just finally PM you’re off to our beautiful Adelaide Hills this morning to the Federal seat of Mayo which historically was a blue chip seat held by the former foreign minister, Alexander Downer. Your presence there today and the former PM’s John Howard’s presence there next Tuesday, does that suggest you guys are worried about Jamie Briggs losing?

PRIME MINISTER:

Well it indicates that we are campaigning all over the country and I’m looking forward, I’ll be with Jamie in a minute. We are just on our way up there now to meet him. Looking forward to campaigning with him today as you say in the beautiful Adelaide Hills.

DAVID PENBERTHY:

We always enjoy catching up with you Prime Minister. Enjoy your time here in Adelaide. Hopefully we’ll get to talk to you again before the election campaign is out. Thank you for joining us.

PRIME MINISTER:

David, I look forward to it.