TRANSCRIPT

 THE HON PETER COSTELLO MP

TREASURER

Interview with Mark Colvin

PM Programme, ABC

Tuesday, 7 September 2004

6.10 pm

 

COLVIN:

The Treasurer Peter Costello says the Labor package has been cobbled together

16 weeks late and 32 days before the election. He says Mr Latham’s tax plan

also contains some glaring errors. The Treasurer joins me now. You say it’s

16 weeks late and only 32 days before the election, but the Pre-Election

Financial Outlook still isn’t going to come out until Friday, you can understand

holding back, can’t you?

TREASURER:

Oh, well this package will unravel. It is already unravelling today.

COLVIN:

How?

TREASURER:

Well, you see Mr Latham made the claim that nine out of ten people would

be better off, and he produced some tables, but he left out of his tables

the $600 Family Tax Benefit.

COLVIN:

And, are you absolutely certain about that? Are you sure he hasn’t folded

that $600 on an annual basis into his figures?

TREASURER:

Absolutely sure because when you go to the footnotes, and I don’t know

if you read it, but if you actually go …

COLVIN:

I haven’t got down to the footnotes yet …

TREASURER:

No I do not know if he read it, because I do not think he understands his

policy. If you go to the footnote on page two of the family tables, explains,

it makes it clear that they just happened to leave out of the weekly tables,

the $600 lump sum payment. Now, can I give you another …

COLVIN:

Before you go on to the next bit, we did hear Mr Latham there saying that

the $600 was not real.

TREASURER:

And he says I can leave that $600 out because it is not real. Now 2.2 million

Australians have just been paid $600. It is per child per annum. They were

paid their first payment before the 30^th of June. Hundreds of

thousands are now going to be paid another payment starting in September,

and Mr Latham said it is not real, and he left it out of his tables so that

he could try and show people were better off under his package.

COLVIN:

Even without the $600, his tables, his annual tables make it look as though

under Labor people would be, average families in the sort of middle income

bracket would be $1,000, $2,000 even $3,000 better off. So you could take

the $600 out, and he would say that they are still better off.

TREASURER:

Oh well, let me come to the next one that he has left out of his tables.

There is a thing called the low income tax offset. He wants to abolish the

low income tax offset and replace it with another credit which I think as

he said, he says is $416. Again, he has left out the effect of the abolition

of the low income tax offset from his weekly tables. So he has left out

the $600 family payment. He has left out the abolition of the low income

tax offset. Now this is not a policy to ‘ease the squeeze’. This is policy

to try and ‘hoax the folks’. The folks are being subjected to the greatest

hoax because he leaves these benefits out of his tables and he says look,

look, once you ignore the benefits that I am abolishing, and once you ignore

the benefits that the Government is paying you, you can be better off under

my policy.

COLVIN:

Whom to believe though, because he says this has been looked at at the

independent think tank, the Melbourne Institute?

TREASURER:

Well I will come to them in a moment. But just believe his footnote on

page two. It is there, you can all read it. Now, let me come to the third

area where he tries to ‘hoax the folks’. We have a programme which is called

the superannuation co-contribution, where low and middle income earners

if you put $1.00 into superannuation the Government will match it with a

$1.50. He is abolishing that.

COLVIN:

But he says that he is going to compensate for that.

TREASURER:

Well again you see he says, this is how he tries to ‘hoax the folks’. Leave

out the $600 payment, leave out the low income tax offset which I am abolishing,

leave out my abolition of the superannuation co-contribution, and you will

be better off.

COLVIN:

Matt Brown said that he was going to have a bit of a difficulty selling

the idea that the $600 was not real. Are you going to have any difficulty

selling the idea that you have to look at the footnotes, and you might find

some problems with this?

TREASURER:

Well I just say look at the footnotes because I assume Mark Latham does

not understand his own policy. Otherwise, well, he either does not understand

his policy or he is engaged in deceit. Because the phrase he used was ‘nine

out of ten were better off on a weekly basis’ and he uses tables which leave

out your current entitlements.

COLVIN:

I am just wondering if there is anybody in the middle with a calculator

who you would both be able to trust to go through all of this.

TREASURER:

Yes. We would trust the Treasury which under the Charter of Budget Honesty

can cost this policy and I call on Mr Latham to give it to the Treasury

under the Charter of Budget Honesty today. Today, let them cost it.

COLVIN:

And is that meaningful to do that now before the…

TREASURER:

Absolutely.

COLVIN:

…Pre Election Financial Outlook?

TREASURER:

He has announced the policy, it can be costed on the same basis that the

tax changes in the Budget were costed.

COLVIN:

You are essentially accusing him of conjuring figures out of nowhere but

just in the last 24-36 hours we have found that there is $1.8 billion that

nobody really seemed to know about. Where did that come from?

TREASURER:

Well that was costed by the Treasury and that is in the figures that the

Treasury will release. But look…

COLVIN:

I mean you still have this huge advantage don’t you of having Treasury

on your side?

TREASURER:

No. I am sorry, no, the Government is in a Caretaker Period…

COLVIN:

So how did you manage to get it costed by the Treasury?

TREASURER:

…and this was a decision that was taken before the Election was called.

COLVIN:

Why didn’t we know about it before?

TREASURER:

This was a decision which was taken before the Election was called and

is in the Budget bottom line.

COLVIN:

Is it surplus…

TREASURER:

You…

COLVIN:

…that has just appeared since the Budget?

TREASURER:

It is funny we are getting off Mr Latham’s tax policy isn’t it on the day

that it was released.

COLVIN:

There’s an election campaign going on. I am entitled to ask you about Mr

Latham…

TREASURER:

Yes.

COLVIN:

…and about your own policies.

TREASURER:

And he has put out a policy today. And you said to me is there any one

that can independently cost it. And the answer is yes. Under the Charter

of Budget Honesty it can be independently costed today. Now he was asked

by journalists would he give it to the Treasury for independent costing.

And the long convoluted answer, the bottom line of which was no. But it

can be given to the Treasury today. The public of Australia can have a look

at it but I would say to the public on those three measures, one he takes

out the $600 payment and he says well I will convince you $600 does not

exist. Secondly he does not allow for the low income tax offset. Thirdly

he abolishes your super co-contribution and then he says, oh but if you

forget all of those things you will be better off.

COLVIN:

So we will see in the next twenty four hours or so whether he will do that.

But in the meantime have you got any more billions here or there? Is there

any more going to suddenly appear?

TREASURER:

During the course of the campaign we will announce properly costed policies

which will be costed by the Treasury. Now…

COLVIN:

But…

TREASURER:

…the only thing I would say to Mr Latham is this…

COLVIN:

…is there anything else like the $1.8 billion that you have got up

your sleeve that has already been costed?

TREASURER:

We will release properly costed policies and we will submit them to the

Treasury for costing…

COLVIN:

So you…

TREASURER:

…I lay down this challenge to Mark Latham…

COLVIN:

But I am asking you…

TREASURER:

…to do the same thing.

COLVIN:

…is there anything that you have already submitted to Treasury…

TREASURER:

Of course we will announce…

COLVIN:

…like that $1.8 billion?

TREASURER:

Mark of course we will announce further policies during the campaign and

of course they will be costed. And the challenge I lay down…

COLVIN:

But that is not an answer to the question I am asking…

TREASURER:

It is an absolute answer to the question.

COLVIN:

No I am asking if there is anything you have already asked Treasury to

cost for you…

TREASURER:

Policies…

COLVIN:

…before the election campaign started like you say the $1.8 billion

was costed?

TREASURER:

And here is the answer. Policies will be released by the Government which

are costed by the Treasury.

COLVIN:

Have already been costed.

TREASURER:

And can be costed. No they will be resubmitted. They will be resubmitted.

COLVIN:

During the campaign?

TREASURER:

So that the Treasury, during the campaign, during the Caretaker Period,

can authorise the costing. And I lay this challenge down to Mr Latham –

do the same. Do the same. Just put your policies into the Treasury. Let

them cost them. The Government is going to put all of its policies into

the Treasury. Just do the same.

COLVIN:

Peter Costello thank you very much for joining us tonight.