The Hon Malcolm Turnbull MP
Leader of the Opposition
Fri, 6th February 2009
Subjects: Securing our economic future; Kevin Rudd's plan to lump every Australian with $9500 in debt; comparable countries using tax cuts for economic stimulus; small business.
MALCOLM TURNBULL:
Well you can see the people we’ve been talking to here are concerned about debt, they’re concerned about the level of debt Kevin Rudd is proposing to run up and the fact that their children and their grandchildren are going to have to pay it off. And they can’t understand why he’s going to take us deeper and deeper into debt – $200 billion in order to fund cash handouts. What will we have to show for that?
Now Reg, you saw the last cash handout, how did that affect your business here?
MR CAIN:
It actually, Malcolm, didn’t affect us here in Gladesville a hell of a lot. We did have people come into the shop before the handout was given and said, ‘I want you to hold that fridge for us’. But they’re still coming in weeks later and still haven’t bought it. So it didn’t affect Gladesville in that sense too much.
MALCOLM TURNBULL:
And what do you think about the idea of another $11 billion being handed out in March?
MR CAIN:
Really I think he’s got to stop shooting from the hip and throwing money at everything, get some infrastructure going, something that’s going to be fundamental down the track, just instead of throwing it away.
MALCOLM TURNBULL:
Well that’s right. Well I think at the moment he is giving drunken sailors a bad name, spending so much money. Look, this is all about the future of Australia. We are facing economic challenges – that’s true. Yes, the Government should act and have an effective economic stimulus but it must be one that works, that gets the maximum bang for every tax payer’s buck. That’s what we are focussed on. We are focussed on prudent investment in the productivity of our economy, investment that will create jobs.
Mr Rudd said his $10 billion cash splash in December would create 75,000 jobs, where are they? We’ve seen no evidence from the Government that it created one job let alone 75,000. And now he’s proposing to back up and do it all over again.
So we’re standing up for good economic management. We’re standing up for the tax payers, but above all we’re standing up for our children because, believe me, when he maxes out our credit card, our national credit, at $200 billion, it will be our children and our grandchildren that will be paying it off for many years to come.
QUESTION:
Mr Turnbull what would happen if you went on this tour in maybe a shopping centre in Penrith and you were talking to shop owners like you just did, what do you think the response would have been from those people and people in Campbeltown?
MALCOLM TURNBULL:
Well to be honest with you from right around Australia we are… Look, when we took this stand I thought it was going to be, I still believe, it will be unpopular. I thought it was going to be poisonously unpopular frankly and we all felt we were going to get hammered into the ground in the opinion polls, and we probably will be, but we took this stand because it was right.
But I have to say it’s been very interesting just looking at the calls we’re getting, and the emails we’re getting, and the feedback we’re getting, is that more and more Australians are starting to say, hang on, this isn’t right? We shouldn’t be spending all of this money and racking up all this debet. Where’s the evidence that it’s going to create jobs? Where’s the evidence that it’s going to make our economy stronger?
So we’ll see. We will see. I have great faith in the common sense of Australians.
JOE HOCKEY:
Just to give clarity there, this is the border of Bennelong and North Sydney. So the suggestion that somehow this is a particularly wealthy area is just dead wrong. Gladesville is middle Australia. Gladesville is very middle Australia and the suggestion somehow that it’s a wealthy area or we didn’t speak to any of the people that are, you know, actually the punters out there is wrong.
QUESTION:
Well what about the elderly in Blacktown or the pensioners in Campbeltown or the people in Rosemeadow who went through what they did last month?
MR CAIN:
Would you like me to speak on say Lismore? Would you class Lismore as middle of the road, because you’ve got Nimbin and those places around it, and I own a store in Lismore and we really didn’t receive too much spending from the last throw away item, I can tell you that and I can show you facts and figures.
QUESTION:
Mr Turnbull what do you make… Kevin Rudd is in Canberra at the moment talking with businesses, unions, schools – a bit optimistic considering the package still hasn’t been passed yet?
MALCOLM TURNBULL:
Well look he’s certainly entitled to talk to whoever he likes. The only person he doesn’t want to talk to or the only people he doesn’t want to talk to are us. What he should be doing is sitting down with the Opposition. We’ve reached out to him and said: let’s work together and see if we can agree on a stimulus package that we can all support. And the Australian people want their leaders in Parliament to work together, but Mr Rudd’s approach, remember, Mr Rudd’s approach was to say, ‘here it is, take it or leave it, you’ve got to pass it through the parliament in 48 hours’. He wanted this legislation passed in 48 hours.
Now because we have stood up for taxpayers, and for our children and for good economic management it’s going to go through scrutiny in the Senate. But he is not interested in negotiation; he is not interested in discussion – and in many ways Kevin Rudd is right out on a limb of his own. Now you’ll recall that we have argued that a better stimulus than another huge handout would be to bring forward the tax cuts that are already legislated for in 2009 and 2010. So they’re the tax cuts the Labor Government legislated for, they were essentially a copy of what we proposed in the last election and had complete support. Bring them forward by 18 months. Mr Rudd and his ministers have said that’s a disgrace, tax cuts have no role as part of an economic stimulus package. And yet every other country in the world, comparable country that is undertaking stimulus measures has included tax cuts. Australia is the only one that hasn’t.
So the person who is out of step with the global response to this is Kevin Rudd.
QUESTION:
Would it be worth sending the Budget into deficit if you were to give more money to small business in terms of keeping jobs, hiring new people, pay rises for those people who are already working?
MR CAIN:
Good question. Very, very good question.
MALCOLM TURNBULL:
Reg, what do you think? There you go – ask a small business proprietor?
MR CAIN:
Why not reduce the payroll tax? We’ve got about 34, 35 people on the staff. We pay about $25,000 a year just for the privilege to employ people. I don’t think that’s a very fair tax. So you could reduce that. You could actually then also put superannuation on hold and that would be a fairer way to everyone to get some money back into the system instead of throwing it at people.
MALCOLM TURNBULL:
Yeah and that’s why Reg what we’ve recommended as a better way to support small business is for the Government to reimburse small businesses for a period, for say two years, for a portion of the superannuation guarantee levy. Now that would put cash back into the hands of every small business. And that of course, the virtue of that is that it benefits every small business whereas payroll tax in New South Wales for example is only paid if you have a payroll that is over $623,000 – that’s the current threshold.
So that is one approach. Look we, unlike Mr Rudd, we don’t believe we’ve got all the answers and we certainly don’t believe we’ve got the only answer. So that’s why we want to sit down with him and talk about effective measures. You see what he has offered small business, the only thing he has offered small business in this package is a 30 per cent depreciation, a tax deduction in effect, for equipment purchased this year. But if you’re a small business and you don’t need any new equipment, maybe you’ve got all the equipment you need, or you’re struggling with your own cash flow problem, that actually isn’t much help at all. Whereas if you give a benefit, be it on payroll tax as Reg canvassed, or on the superannuation guarantee levy, and then you benefit every business, every small business, then you’re actually putting cash back into the small business owners’ hands and above all making the cost of employing people less.
Remember, what is this all about? Jobs, jobs, jobs. Every dollar the Government spends, every policy it undertakes has to be about creating jobs and preserving jobs. And this package is not about jobs, indeed one of the Treasury officials said last night, long term it’s not about supporting jobs. Well it should be about supporting jobs and creating jobs short term, medium term and long term. That is our commitment.
QUESTION:
Mr Turnbull what is your view of Treasury saying the Government needs all $200 billion of the money that it’s seeking to borrow?
MALCOLM TURNBULL:
Well running up the expenses they are they will need to borrow $200 billion, but that’s the whole point. They’re spending too much and they’re borrowing to pay for it. What they’re doing is they’re maxing out the credit card. I mean it’s their decision to spend all this money; they are creating the debt by spending this money.
JOE HOCKEY:
Just to add there the Government has committed $66 billion of new expenditure since the last Budget, and given that it took us 10 years in government to pay of $100 billion of debt, how long will it take to pay of $200 billion of debt, let alone the fact that they’re flagging now that they’re going to have even more.
MALCOLM TURNBULL:
Thanks guys.
Video of the above door stop included in this news report
