Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia
The Hon. Scott Morrison MP
The Hon. Josh Frydenberg MP
PRIME MINISTER: Tonight, the Parliament of Australia voted to reward aspiration. The hard-working aspiration of Australians all around this country, quietly going about their lives, seeking out their future, putting the effort in, having a go. And as a result of what was passed in the Parliament tonight, getting a go. And getting a go as a result of the Government sticking to its plan, a plan that we put to the Australian people at the election, a plan that they voted for. And I'm pleased that tonight, in the Senate and in the House of Representatives earlier in the week, the Parliament has also voted for.
This is a win tonight, not for the Government, not for the Liberal and National parties. This is a win for those hard working Australians quietly going about their lives. And these are the people we will keep our faith with every single day. I said we would burn for them and that is exactly what we've been doing this week. And we will do every single day and week between now and of course the next election. They know where we stand when it comes to their aspirations. They know we believe it, they know we get it, and they know we will work as hard for their aspirations as they will themselves.
I particularly want to congratulate the two gentlemen standing with me here this evening, because this is the plan that was first put in the Budget earlier this year, that we took to election that the Treasurer handed down. And it has remained steadfast ever since that night as we sought to prosecute it, not just in the election, but now we're back in Parliament. I also want to particularly commend Senator Cormann for once again bringing it home, Mathias, for the Australian people.
It is disappointing that it was necessary to actually seek to negotiate the passage of this legislation through the Upper House and by working ultimately with the crossbenches. This is a Bill that should have been supported by the Labor Party, if they’d been listening to the Australian people at the last election. But they chose not to. It's quite clear, through their belligerent opposition to these measures, each and every day since the election, seeking to prevent and frustrate and thwart the Government's efforts simply to keep faith with the Australian people who work so hard. Labor has showed again this week that they will always be the party of higher taxes. A party that has not understood the aspirations of all Australians. But our parties, the Liberal and National parties, have always understood that. And we always will.
So I thank also those Members of Parliament, both in the House and in the Senate, that have supported this package of measures. And I believe the Australian people will be thankful to them also. Next week, $1,080 for people earning up to $126,000 they will be able to redeem back through their tax returns next week. But not only that, the Bill was not only just about that, the Bill was also about longer term structural reform of our tax system. Building on the changes we made in the previous Budget. So now, when you look forward over the next decade - because that's what it's a plan for - Australians can plan for their future with confidence. They know the harder they work, they will not face those higher rates of tax, for the majority of Australians. 94 per cent never facing a marginal tax rate higher than 30 cents in the dollar. That's what real tax change and reform looks like, and I'm so pleased we've been able to deliver it for the Australian people. Josh.
THE HON JOSH FRYDENBERG MP, TREASURER: Thank you Prime Minister. The Australian people have got the tax cuts that they voted for. This is good news for the economy. It's good news for Australian families. It's good news for Australian workers. And as the Prime Minister has said, we will see up to a $1,080 into the pockets of low and middle income earners from as early as next week, and long term structural reform.
But what has defined this tax agenda, and thank you Prime Minister for your leadership in last year's Budget and through this year's Budget as well. And Mathias, thank you for your incredible negotiation skills through the Senate as well. But what has defined this tax package is the values that underpin it. Reward for effort, encouraging aspiration, and enabling Australians to earn more and keep more of what they earn. That's what the Liberals and Nationals believe in. That's what defines our Coalition Government, and we will continue to grow the Economy with our plan set out in the Budget.
PRIME MINISTER: Thank you Josh. Mathias.
SENATOR THE HON MATHIAS CORMANN, MINISTER FOR FINANCE: Thank you Prime Minister. I am just so pleased that the Senate tonight kept faith with the verdict of the Australian people at the last election.
At the last election the Australian people voted in favour of our plan for lower income taxes because they understood that offered them the best possible opportunity to get account on the back of a stronger economy. Australians voted against the high taxing agenda and the politics of envy pursued by the alternative.
Tonight’s outcome is indeed great news for millions of working Australians who will receive income tax refunds from the end of next week.
This is a comprehensive plan which both delivers short-term cost of living pressure relief to low and middle income earners through the tax refund starting from next week. But it does also include that structural reform which takes the bracket creep monkey off people’s back.
Leaving bracket creep unaddressed undermines aspiration and weakens the economy over time. Weakening the economy over time because we leave the bracket creep monkey running rampant, that would actually be very bad news for low-income earners in particular.
Tonight is a great outcome for Australians right around our great country, who all they want is the best possible opportunity to get ahead.
JOURNALIST: Prime Minister, the cost of the package is obviously a significant issue, and you were asked in Question Time today if there would be any cuts to services and you said, ‘none’. Is that a rock solid guarantee for a decade ahead?
PRIME MINISTER: It was in the Budget. And it was confirmed in PEFO and confirmed independently the plans… the tax plan was all set. And that's exactly why I said what I said today in the House. Labor tried to use every single excuse. I mean, the only innovation we saw from the Labor Party this week was coming up with more and more excuses as to why they wouldn’t support this package. And then tonight, capitulating in the rabble that they have shown themselves to be over the course of this week and over the course of dealing with this issue. So our plans were set up very clearly and they were all independently verified by the secretaries of Finance and Treasury at the election. It doesn't get any more any more certain than that.
JOURNALIST: But 2024 is outside the forward estimates…
SENATOR THE HON MATHIAS CORMANN, MINISTER FOR FINANCE: But hang on. On the basis of no policy change, the Prime Minister is exactly right. This is just the Labor Party going back over and over through a pre-election argument…interrupted
JOURNALIST: So is that a guarantee?
SENATOR THE HON MATHIAS CORMANN, MINISTER FOR FINANCE: If I may, through a pre-election argument. They tried to run this flag up the flagpole during the election. It was widely discredited for good reasons. If you look at the pre-election economic and fiscal outlook, what that says very, very clearly is that the projected surpluses after we have paid for record funding for hospitals, schools, infrastructure and all the other essential services Australians rely on, after we have accommodated the fiscal impact of our income tax relief in full, our Budget remains and is projected to remain in surplus all the way over the medium term. That is based on an assumption of no policy change. That means, based on an assumption of no future policy decisions to cut spending. That is why the Prime Minister is absolutely right when he gives that iron clad guarantee that these tax cuts do not require and are not based on an assumption of future spending cuts.
JOURNALIST: Prime Minister, you knocked off a few Labor amendments this week, including one that would have brought forward a stage of the tax package. Are you open to bringing forward or changing any element of this package should the economy need further stimulus, but equally can you rule out any delay to any of the implementation over the seven years?
PRIME MINISTER: Well, let me say this - the Budget that we handed down in April this year was our plan to deal with the economic challenges that we've always known have existed. Now, I know it may be a mystery to the Labor Party about these challenges, because they were proposing to put $385 billion of higher taxes on the economy. I'm going to be generous to them and say they mustn’t have understood the serious challenges the economy was facing to put forward such a diabolical plan for the Australian economy. We knew the challenges the Australian economy has been facing, and particularly the three of us have been very upfront with the Australian people about the nature of those challenges. So we fashioned a plan that was in this year's Budget to deal with those challenges. And so the task now is to implement that plan. Now, that plan isn't just tax relief, as you know. That plan is to implement our infrastructure agenda and there is no shortage of projects that we currently have to progress now. I mean, we have around 300 projects under our $100 billion plan that are still yet to commence. We have many in place right now, and are being commenced, and I have spent the time since the election spending time with the Premiers, as Michael McCormack has as well, and Minister Tudge, to get the pipeline of these projects locked down. The start dates, the contractual arrangements, how they're going to proceed with the delivery of the projects. Because we've always agreed of the need to use our infrastructure investment as a way to support the economy. That is not new. The $100 billion plan used to be a $75 billion plan. We increased it to a $100 billion plan to address the very issues that, frankly, the Governor of the Reserve Bank first raised with me some years ago when I was Treasurer and he's raised the same points with the now Treasurer. So our plan is designed to address that, as is the skills agenda, as is the regulation congestion busting agenda that I announced in my speech when I was in Western Australia, as is the skills agenda, as is the modernising of the Australian financial system and economy, particularly the digitisation of our economy. What does that mean? It means that small businesses get paid in real time, and there's a lot more money moving through the system. So this is a comprehensive economic plan that we took to the election, and you know, I can talk about defence industry procurement as well, and of course the trade deals which have been securing, protecting, and broadening our market access. So that's our plan. We're going to implement our plan. And of course, as we always do, if and when there are ever other measures that we think should be added to that plan, well we’ll consider at that time. There’ll be a MYEFO at the end of the year, but the most critical thing now was to give these tax cuts through the Parliament to provide that certainty for Australians, not just today but into the future. Same reason why we did the small business and medium sized business tax cuts, the same reason we did the instant asset write off. All of this is designed to create jobs and let people have more of their own money so they can invest and get ahead.
JOURNALIST: What agreement have you come to with Jacquie Lambie in return for her support today?
SENATOR THE HON MATHIAS CORMANN, MINISTER FOR FINANCE: Senator Lambie was extremely clear as were the other Senators. Senator Lambie formed a judgement to support our income tax relief package in full, on its own merits. As I have been saying for some time now and I have said it again and again. Of course we are always happy to work with non-Government Senators in relation to issues of concern to them and their constituents. That is what we will continue to do. It is a matter of public record that Senator Lambie is very passionate about the issue of public housing in Tasmania. She is a fierce advocate for her state of Tasmania. We have agreed to work with her through that issue... interrupted
JOURNALIST: But Jacqui Lambie seems to be of the view that she has some sort of agreement to waive the $157 million in debt. If she doesn’t have you agreed to give her something in kind that will be comparable to $15 million a year that they are spending on interest payments. She seems to be of the view that you are going to waive the debt. Are you waiving the debt or not?
SENATOR THE HON MATHIAS CORMANN, MINISTER FOR FINANCE: I sat in the chamber. I listened very carefully to Senator Lambie. Senator Lambie said extremely clearly that she made a judgement and she made a decision to support our income tax relief plan in full on its own merits. She trusted that as we have undertaken to do, that we will work with her through the issue that she has raised in good faith, over the next few weeks and next few months.
PRIME MINISTER: Remember, Minister Sukkar was just down in Hobart very recently and these are issues that have been similarly raised with us by Premier Hodgman as well. It's a matter I have been conscious of for some time. So these are serious issues and she's raised them, as she should.
JOURNALIST: Prime Minister, you spoke to the US Ambassador two hours ago. Did the US help in the release of Alek Sigley?
PRIME MINISTER: Look, I don't think it's useful at all to go into any sort of detailed commentary about the process that are involved ensuring Alek, and I can give a further update, about now actually, that very soon he will be on a plane on his way to see his wife in Tokyo. And so I can only imagine how wonderful that will be for them to be reunited. I can only state again how appreciative we are to the Swedish Government, and later tonight I will be speaking with the Swedish Prime Minister to thank them as well, and I look forward to that conversation. But it is in nobody's interests, in these quite sensitive consular cases, to go beyond simply saying I'm so pleased that he's safe and I’m so pleased he is being reunited with his family.
JOURNALIST: Do you have an explanation as to why he was detained?
PRIME MINISTER: I’ll just refer you to the answer that I just gave you. It is in nobody's interest expect simply to say thank goodness Alek is safe.
JOURNALIST: Prime Minister, Anthony Albanese has said that he may go to the election vowing to repeal stage three of the package. Do you have a response to that?
THE HON JOSH FRYDENBERG MP, TREASURER: PM? I could say, well, if he does do that, then someone who is on the average full-time earnings in 2024-25 - that will be around $100,000 - they will be $1,375 worse off as a result of repeal of such legislation. So, at the end of the day, Anthony Albanese and Labor have been- have shown themselves to be the party of higher taxes. This is leaving more money in people's pockets, and it will deliver them - and Australia - a better, simpler, stronger tax system.
PRIME MINISTER: I would go even further - it is Labor’s policy. It hasn’t changed. It's their policy to deny dividend imputation credits as well, that hasn't changed. It’s their policy to abolish negative gearing as we know it, that's still their policy. Capital gains tax increases by 50 per cent - still their policy. Higher taxes on small business - still their policy. I mean, if they haven't got the message by now, that higher taxes kill aspiration in this country, they never will. They never will. You can't trust Labor when it comes to taking money from you. They will always want more.
JOURNALIST: Prime Minister, can I ask, just take you back to your comments about the Budget being your economic plan. The Reserve Bank Governor has obviously made clear that there is a need for more fiscal stimulus beyond the tax cuts, which he welcomes as a good first step. Can I take from what you're saying that, what is in the Budget is the extent of your proposed fiscal stimulus? Or is there scope to do more than what is already outlined in the Budget?
PRIME MINISTER: Well, Josh will comment on this as well. But I think people should be careful in terms of how they are offering commentary on what the Reserve Bank Governor has said. The Reserve Bank Governor has pointed to the need to ensure that we deliver significant investments in public infrastructure. That is exactly what we are doing, and it's not a new view expressed by the Governor. He's been expressing it for some years, and that was the impetus for the initiative we took some years ago when we really started ramping up our investment. And those investments are now flowing, and those investments have played an important role in ensuring the continued growth of the Australian economy during some difficult times. So our Budget and our actions here, right now, are entirely consistent and synchronized with the comments made by the Reserve Bank Governor. Josh?
THE HON JOSH FRYDENBERG MP, TREASURER: Thanks, PM. In the most recent statement from the Reserve Bank, they pointed out - in their words - that employment growth was strong. We've seen more than 1.3 million new jobs being created and unemployment at the lowest level in seven years. They also pointed out that the spending on infrastructure was offsetting some of the challenges that we have seen elsewhere in the economy. And they also pointed out that the central scenario about economic growth remains, which is to come back, which is to be at trend. And we do know in the Budget we’ve set out that our forecast is consistent with that. But we also agree with the Reserve Bank Governor that it's not just monetary policy that should do the heavy lifting - it's also what we do in fiscal policy, and that was set out in the Budget, as the Prime Minister said -tax cuts. This is a very significant boost to household incomes. Infrastructure spending, the skills package, and of course all the other measures that we are undertaking.
PRIME MINISTER: Can I commend to you the rest of the interview that Josh did with 7.30 tonight and the rest of the responses he gave to many other questions. But tonight, you saw a united Government team, Liberals and Nationals, and I think you could see that very clearly on the floor of the House of Representatives tonight. And I think you can see very clearly where Labor was on this issue by looking on the other side of the Chamber. Thank you very much.