LEON BYNER:

Prime Minister – Malcolm, thank you for coming on the program today.

PRIME MINISTER:

Leon it’s great to be on your show this morning.

LEON BYNER:

I want to hit something that is absolutely crucial to your campaign and that is there is a policy difference between you and Labor in that if Labor was elected to government next Saturday, they would have a royal commission into the finance sector – you say no, no that’s not the way to go – you want to give the regulator more teeth. But can I draw your attention to an issue that I suspect you’d be aware of and that is a very big story where a 46 year old man had his life insurance claim refused by Comminsure after he had a major heart attack in September 2014 because it wasn’t the right kind of heart attack.

Now a lot of people listening to this program will believe that when they’ve got insurance for something like this, that peace of mind can be because the institution will do the right thing. Now by not having a royal commission – how are you going to address these sorts of issues?

PRIME MINISTER:

Well, Leon the first point I’d make is that a royal commission won’t address any of those issues. A royal commission would result in years of delay, enormous expense – the legal profession I guess would do very well out of it - but there would be absolutely nothing in terms of action.

Now what we’ve done is we have taken real action to boost the power of ASIC, which is the regulator and we’ve ensured that they have the resources to go after wrong-doers in the system.

Now, just to give you a little more detail on that – the Treasurer and I brought the banks in and they made a number of undertakings to us to clean up their act and they are going to review their product sales commission that has been an issue – they are making consumer dispute resolution processes more straight forward and easier to access. They are protecting whistle-blowers. They are establishing a register of road advisers who’ve been removed from one job back somewhere and then get a job somewhere else. They are reviewing and strengthening the banking code of conduct and of course they are paying all the additional $120 million that we are giving to ASIC - $127 million. Now we are also stopping businesses from charging excessive fees to consumers – for customers for using a credit card. So these are all the sort of practical measures we’re undertaking.

LEON BYNER:

Hasn’t the Reserve Bank already done that, Prime Minister? With regards to the fees?

PRIME MINISTER:

Yes, well that is right, but that was a policy of ours. That was a policy of ours that came out of…

LEON BYNER:

So you’re going to – because at the moment there is still these damn fees – you see.

PRIME MINISTER:

What we are doing is we are changing the law – Scott Morrison and I announced this earlier, some months ago - we are changing the law so that if a merchant says the fee for using a credit card is X per cent that can be no more than the actual additional cost to them of accepting payment on a credit card as opposed to accepting it in cash. Because what a number of merchants were doing and I think we all understand this, were adding very significant premiums on credit cards and particularly in the online environment of course you haven’t got the alternative – so you don’t have an opportunity. So we are taking real and practical action in the here and now and ensuring that both the banks clean up their act and they understand that they are being very carefully monitored and also that we give the regulator the resources to pursue wrong-doing and you know, I have to say the Chairman of ASIC supports the approach that we are taking. I mean a royal commission of the kind that Mr Shorten proposes would simply delay matters – it would put everything into suspended animation while an enquiry went on, the enormous scope and length and expense and at the end of that what would you get? You would end up no doubt with some recommendations to give ASIC additional resources or perhaps some additional powers – well we are doing that now.

LEON BYNER:

Prime Minister, so what would happen then if a client of Comminsure, or any other similar organisation had the same thing happen to them as was publicised on 4 Corners and nationally in the press – what would they be expected to do to get some kind of restitution?

PRIME MINISTER:

Well this is where the, this is where you’ve obviously got to look at what their legal rights are. They’ve got to go to ASIC. Depends on what the terms of their contract say. Again this may be a fault - this may be mistreatment by the bank. It may be that there is a term in the contract that is inappropriate. So you can’t generalise just from one example, even one that is clear that appears to be egregiously wrong, but it is very important to ensure, particularly in times like this, these uncertain times, that we don’t create more uncertainty than is already out there in the market. So what we are doing is making sure that the banks clean up their act – do a better job – are dealing with their customers, they have made a number of changes at their end and you should get one of the bank CEO’s on to talk about it Leon.

What we are also doing is ensuring that the tough cop on the beat, ASIC, and that’s not the only cop on the financial services beat – there is also the RBA, there is also APRA and the ACCC - but ASIC is the one that is probably most relevant and that they have the additional resources to do their job, of dealing with wrong doing and ensuring that people are identified and then are prosecuted and dealt with. Now, they are powers that a royal commission doesn’t have.

LEON BYNER:

I want to talk about your investment in Woomera. You keep talking about innovation but in the last few years under the Coalition’s watch, the number of apprenticeships has somewhat diminished. Does that worry you at all? And does it fly in the face of the things that you’re trying to sell to the Australian people, jobs and growth? We need skill and if you’re going to invest in something like Woomera or other things we need skilled people but again we seem to be diminishing in the number of apprenticeships. Have you got a plan to address that?

PRIME MINISTER:

Well we do and let me make one very obvious point but it is one worth making nonetheless. The most important thing to drive employment whether it is of apprentices or trainees or older experienced and mature Australians is strong economic growth. We are the only party in this election that has a clear economic plan, every element of which is designed to ensure that we get stronger economic growth and more jobs.

LEON BYNER:

How are you going to encourage more apprenticeships Prime Minister?

PRIME MINISTER:

Well firstly by having – if a business is growing, a business is being invested in, if its making money and if its owners think it can expand then they are more likely to take on new apprentices and indeed new staff. That is the most important point but let me deal with some specifics. What happened under the Labor government is that they cut about $1.2 billion from employer incentives to take on apprentices. This triggered a 25 per cent drop in take up. It was the biggest commencement drop on record.

LEON BYNER:

Are you going to put them back?

PRIME MINISTER:

What we have done is we have put in, as you know, an apprentice loan program. And what we’re seeing now is very strong growth in apprentice commencement. So the construction trade, apprenticeships in construction trades overall are up 35 per cent, brick layers are up 14, joiners up 28, plumbers up 57. While we didn’t continue with Labor’s ‘tools for your trade’ payment, we replaced it with a trade support loan scheme which is around the same amount around $900 million program. So what we have done is provided that support and what we are seeing now is an up-tick in apprentice commencements but the problem arose – and I know politicians are always saying the other side did it and so forth – but the historical fact is the drop off in commencements occurred under the Labor Party, so the numbers are where they are today but we have seen a big rise in commencements under our Government.

LEON BYNER:

Are you aware that the Lowy Institute did a survey they released a few days ago and it showed that 87 per cent of Australians have a real problem with selling off agricultural land to foreign buyers? Are you aware of that?

PRIME MINISTER:

I am certainly aware of the – I wasn’t aware of that particular percentage I am aware of the issue certainly, absolutely.

LEON BYNER:

So again, given such a high number, are you in tune with what the public want on this?

PRIME MINISTER:

Well we obviously have to get the balance right and make decisions about foreign ownership in accordance with our national interest. Now what we have is a trigger for consideration by the foreign investment review board which is at $15 million. That is when foreign investment for example in agricultural land becomes considered. Now Penny Wong from your own state in South Australia has said that they want to abandon that. She says that’s inappropriate, or unorthodox, or whatever and Labor is not committed to it. You saw the way in which Scott Morison did not give approval to the very large agricultural land acquisition recently, the Sydney Kidman estates. So we have demonstrated that we are able to say no and that we are able to take a discriminating approach to this. It is very important.

LEON BYNER:

If the Brexit fallout creates a bigger problem for Australia, because as you know there is a lot of money being wiped off the stock market recently in Australia, if there is a very bad fallout, do you have in your Budget resources to deal with this kind of contingent where you would argue that the reason Labor was able to handle the financial crisis was because of the legacy of the former Treasurer. Have you got the resources now if this was to happen?

PRIME MINISTER:

Well let’s get the history right first. Labor mismanaged Australia’s response to the Global Financial Crisis. I mean this was the era that saw the school halls fiasco, it saw the pink batts scandal, tragic scandal in fact, cash for clunkers, all of those other – they overspent. They spent too much and unwisely. What pulled Australia through the GFC was firstly, strong financial regulation of our banks, secondly, the cash at the bank that John Howard and Peter Costello left, and thirdly and this was very significant, was the huge stimulus the Chinese Government had which of course drove the demand for iron ore and coal and all of the other resources that we export there. That’s not going to happen again.

LEON BYNER:

Which is why I ask you the question.

PRIME MINISTER:

Yeah exactly, just getting the history right.

Now what we’re seeing at the moment – and its early days of course – we’re seeing more uncertainty, more risk perceived in the market. This is the nature of our times. You’ve heard me say many times Leon that we live in times of rapid economic change, enormous opportunities, but enormous challenges, plenty of risks, plenty of uncertainty. So you need to have a resilient economy, you’ve got to have a plan that meets the nature of our times. And that’s why what we’re doing with our plan is ensuring that we open up those big export markets in Asia where half of the middle class will be living very shortly. We’re ensuring that we’re reducing taxes on business so that they’ve got greater incentives to invest; we’re promoting innovation and advanced manufacturing, especially in your state, through the big Defence industry investment plan there. So right across the board we’re encouraging investment, innovation, entrepreneurship, enterprise. Now all of that makes us more resilient, makes us more attractive as a place to invest in.

Labor on the other hand, what are they doing? They’re going to run higher deficit, more debt and higher taxes. They’re actually going to increase taxes on investment which will of course discourage investment.

LEON BYNER:

But my point is, do you have the resources to handle those severe downturns?

PRIME MINISTER:

Well Leon what we have is the resources and the plan to ensure that we have a strong economy. We have inherited from Labor – we left Labor with cash at the bank as you remember in 2007 – we inherited a budget that was not only in deficit and with plenty of debt, but it was also in structural deficit. So it has been very challenging as the mining boom has wound down, to bring it back into balance. Now we’re confident we can get it there over the next four years and coming into balance in the fifth year…

LEON BYNER:

If there is no downturn though.

PRIME MINISTER:

Leon it depends on the circumstances. Regardless of whether you think the global economy is going to grow faster or slower, we are always better off with an economy that is more competitive, more productive, more innovative, more resilient. We are setting Australia up to succeed.

LEON BYNER:

Do you think you’re going to win on Saturday?

PRIME MINISTER:

It’s in the lap of the gods. It’s in the lap of the Australian people.

LEON BYNER:

How do you feel?

PRIME MINISTER:

Leon, I’m confident that we are presenting a clear economic plan. I’m confident that we are presenting a stable, Coalition majority Government and I’m asking Australia and Australians to choose stability, economic security, a clear plan that is being designed carefully for the nature of the times in which we live; times of opportunity, great opportunity as many of your exporters in South Australia are seeing, but also plenty of risk. We’ve addressed those issues.

What our opponents have is the extraordinary combination of higher deficits, higher debt and higher taxes, all of which discourage the investment and the employment that we need to secure our future and that of our children and grandchildren.

LEON BYNER:

Prime Minister thanks for your time, I know you’re up in Queensland at the moment. When you get an opportunity, this is a question on notice, can we please do something about our power prices in South Australia, where a PowerPoint has become a status symbol.

PRIME MINISTER:

Thank you Leon, thank you. You know one important point to bear in mind, as you know I’m very committed to taking action on climate change.

LEON BYNER:

Yes.

PRIME MINISTER:

We agreed to very substantial emissions reductions targets from the Paris Conference as all the other big, major economies have done around the world. We have the means to meet those targets, we’re going to meet and beat the 2020 target. We’re well on track to meet the 2030 target and we’re doing so without a massive hike in electricity prices, which is what the Labor Party is offering.

LEON BYNER:

Well we’ve already had the hike here, we’re all taking one.

PRIME MINISTER:

Well you’ll have an even bigger one if Bill Shorten gets up.

LEON BYNER:

Are you telling us it can’t get better?

PRIME MINISTER:

What I’m saying to you is that under the Labor Party, their approach is going to put upward pressure, they’re going to in fact increase electricity prices, because the targets that they are proposing are ones that are unilateral and very high and will only result in higher electricity prices for Australians.

My view – and I say this as someone who takes climate change very seriously – is that our emission reduction targets, which are very substantial now and I’ve had personal thanks from the American President for the commitments we’ve made – we should increase them as the rest of the world does, not strike out alone with extremely high targets, extremely costly targets such as Mr Shorten proposes.

LEON BYNER:

Malcolm Turnbull - thank you for joining us.