TRANSCRIPT

THE HON PETER COSTELLO MP

TREASURER

The John Laws Show
Interview with George Moore
2UE 

Wednesday, 8 September 2004
9.15 am

 

SUBJECTS: Labor’s tax policy hoax

And on the line we have the Treasurer, Peter Costello, good morning.

TREASURER:

Good morning, good to be with you.

MOORE:

Good to be with you too, sorry Lawsy is not here, he is not a well boy

today, but these things happen.

TREASURER:

We should send him a cheerio, George.

MOORE:

Can we? Before we get down to the serious business, or maybe this is the

way to lead you into the serious business, the talk in the office this morning

is all about hair colour. And the talk is, and you know what is coming,

don’t you, the talk is, they said that Peter Costello will take to this

tax package like a CSI sleuth and the word in the office was, that unfortunately,

he looks more like Horatio, with the red hair, than Grissom. Now to be quite

honest mate, I prefer Grissom.

TREASURER:

I would be pleased to keep whatever I have got. I am sort of at that stage

where you don’t really care about the colour just as long as you have got

something left.

MOORE:

As long as there is something there.

TREASURER:

Yes.

MOORE:

You shouldn’t…

TREASURER:

I will take it any colour it comes.

MOORE:

…you shouldn’t fall asleep in the hairdressers, mate. All right,

so what do you make of it all?

TREASURER:

Well there are going to be millions of Australians worse off, so that is

the first point to make. Mark Latham yesterday, tried to rig the tables

and he tried to rig the tables to try and make out that, as he said, nine

out of ten families would be better off. He has been caught rigging the

tables and when you re-do them, it is clear that millions of Australians

are going to be worse off under Mark Latham.

MOORE:

So he presented the weekly amounts without that $600.

TREASURER:

That is right…

MOORE:

And I noticed he kept using the word weekly.

TREASURER:

Yes.

MOORE:

When the annual amounts were there, the $600 was factored in.

TREASURER:

Yes he got caught out.

MOORE:

Why would they do that? That is such an obvious catch.

TREASURER:

Well, no, no, he, and I will come to a few other areas where he has now

been caught out as well. He figured that he could mislead people with these

tables, and to make his policy look better, what he had to leave out of

the tables was the fact that the Government is paying an extra $600 per

child per annum. Now he then said, oh well, because you pay that on an annual

basis, I can leave it out of a weekly table, you know, almost as if you

don’t get it. And if I leave it out of the weekly table then my policy will

look much better than it is. Now a lot of the journalists fell for that,

and it is only, the public are only waking up to it today, that he rigged

the tables, and that he has left that $600 out. Now, he then said last night

when he was caught, well he would have another look at it. He is now admitting

that as a consequence, when you add that back in, hundreds of thousands

of families will be worse off because he is taking away that $600 and when

you add back in a number of the other things that he left out when he rigged

the tables you will get many more.

MOORE:

Now I am surprised that he did that because it is obvious that it might

go down well at the initial press conference, these things are so complex

and we are all struggling even today, to work out whether we are worse off,

better off and where we go, but eventually these things do come out because

people like you of course get stuck right into it.

TREASURER:

Well that is right. He released it late in the day, I didn’t get it until

the afternoon and I had to start reading it and you know, I twigged after

reading it, but he would be quite pleased with the way in which he managed

to fool a number of the newspapers today, haven’t picked it up and it is

only now on talkback radio where people are ringing in and saying, hey,

he has rigged the figures, hey we are worse off.

MOORE:

Now there are some good things in there. I rather like the transferring

of the tax free threshold, and this is something that you guys could have

perhaps picked up some time ago, when you have got a single income with

a married couple, you can both get the $6,000 tax free threshold.

TREASURER:

Yes, we already allow that, of course, for single incomes, in fact we allow

better than the two tax-free thresholds and that is called Family Tax Benefit

Part B, and again this is where he has done his sleight of hand, because

he is abolishing that Family Tax Benefit Part B, he has to re-introduce

a part of it, so although he trumpets that as a new benefit, it is actually

a lesser benefit than you currently get if you are on Family Tax Benefit

Part B. And this again is where it is catching up with him as people get

onto the details, that single income families are going to be worse off

under Mark Latham. That is, if Dad is in the workforce and Mum is at home

looking after the kids, these people are, it is not that they are just going

to be no better off, he is actually going to take money from them.

MOORE:

What surprises me about this and there is talk this morning, as I say,

this is so complex, so complicated, it takes some time to get right into

it, but there is talk this morning that sole parents on low incomes will

actually be worse off under this Labor policy, yet I pulled out the Sydney

Morning Herald this morning to try and work out our own, without giving

my own details here, our own family, we are not low income, but we look

as though we will be a few dollars a week better off, so what has gone wrong

here?

TREASURER:

Yes again, low income earners, single income that is, where there is one

parent in work on a low income, or maybe it is a single parent family, they

are going to be worse off too. He is actually taking money from them. This

again, you know, he has been very tricky, you have got to hand it to him,

he has managed to fool a lot of the journalists, but he takes off them,

the single income families, a tax offset which means they are actually going

to lose money, that is, the really low income earners are going to have

money taken away from them under this tax package.

MOORE:

All right now, the big problem here, and I guess as we are in the middle

of an election campaign, is that it is not the detail of this that is going

to win or lose it for Labor, it is the overall perception by the voters,

as to whether this is a good package or a bad package, better than the Howard

Government’s package or what have you. So where do you see the dangers for

you here? What will your attack, which parts are you attacking?

TREASURER:

Oh well, first of all it is dishonest, because he has left out the $600

that families are all being paid, 2.2 million Australian families receive

that, and he has pretended that it does not exist, so it is dishonest. The

second thing is, single income families are going to be worse off, that

is where Dad’s in the workforce and Mum’s looking after the kids at home,

they are going to be worse off. Thirdly, when he talks about $8 per week

that is not even real for a large number of people. If you are earning less

$27,000 you don’t get $8 a week. Fourthly, it hasn’t been costed, so we

call on him now to put it into the Treasury Department for costing, because

they are the independent costers, and you will find that he has done a really

dodgy thing here on his modelling. And the final thing I say, and this is

what people have also got to get their minds around, it is a real big attack

on their superannuation.

MOORE:

Yes, it does seem to go against the prevailing mind set, doesn’t it, I

mean we have been talking for the last couple of years that we have an ageing

population and that people over 50 or so on, and people need to put away

for their retirement, so that they have actually increased the tax on some,

or they have done away with the co-payment.

TREASURER:

Yes. We have this situation where if you put a dollar into superannuation,

than the Government matches it with a $1.50, and if you put $10 in the Government

will match it with $15, and if you put a $100 in the Government will match

it with $150. He has just abolished that, so if you put $100 in you won’t

get a thing. So, you had the chance to put $100 in and get $150 from the

Government and have 250 bucks, he has just abolished that $150 co-contribution.

And he has also increased the superannuation surcharge so, I think once

people realise that this is a real big attack on their superannuation savings,

they are going to think to themselves, well, gee, with an ageing population,

and I am a bit worried about my retirement, why is Mr Latham attacking my

superannuation, and I think as that begins to seep through the community,

they are going to say, ooh gee I don’t like this.

MOORE:

All right, just finally, in parting I would say in trying to wade our way

through all this, this morning and yesterday, is that our tax system is

just so damn complicated, and way, way too much for most people to even

understand.

TREASURER:

I think by the time Mr Latham has his way it will be a lot more complicated.

MOORE:

So perhaps you could do some work there as well.

TREASURER:

Well absolutely. I mean the best thing we can do is defeat this complication

and that will at least make sure it does not get any worse.

MOORE:

All right, now this was the one the Government side would have been fearing,

because this was the one that people were saying, wait till the tax package

comes out, and we have been waiting, and waiting and waiting and baiting

him, and baiting him to get it out there, what was your response when it

came out?

TREASURER:

Well, we could see why he had been hiding it, because, you know just, the

attack on the single income family is, I do not think I have ever seen a

situation where a person brings down a policy to make people worse off.

I have seen policies that do not make you better off, but to actually bring

down a policy to make single income families worse off, that is take money

they are currently getting away from them, and we are talking about single

income families on incomes like $35,000, to actually take money away from

them, gee, I mean, when it came out I realised why he had been hiding it

so long.

MOORE:

All right, thanks for your time this morning.

TREASURER:

Good to be with you.