Assistant Minister to the Prime Minister
SHARRI MARKSON, HOST: Let’s bring in Assistant Minister to the Prime Minister, Patrick Gorman, and Nationals Leader in the Senate, Bridget McKenzie, to discuss. Welcome to both of you. You’re in Canberra for the Parliamentary Sitting week. Look, so this Treasury modelling showing that 10 per cent of Australians will have a super balance of $3 million in 30 years. Patrick, wasn’t this misleading, for Labor to present the super changes as only affecting a small proportion of people, 80,000 people, when in fact, in 30 years it’s going to be one in ten people, potentially 2.5 million people?
PATRICK GORMAN, ASSISTANT MINISTER TO THE PRIME MINISTER: Well, Labor built Australia’s superannuation system. We will be the strongest defenders of that system and we want to make sure it’s sustainable for the long term. Now, we don’t have a debate every time we’re talking about any policy area about, well, where is it going to be in 30 years’ time? We bring the data about where it is this year, in 2023, and that is that it’s only going to affect five out of every 1000 Australians. That’s a very small number and it’s a very modest change. And I want to make a few points about what this means when it comes to people – who are very fortunate, and I congratulate them who’ve got those larger superannuation balances. Firstly, it is only for the amounts in those large superannuation balances, over $3 million. It won’t kick in until after the next election.
MARKSON: But the legislation is being introduced in this term of Parliament. So that does amount to a broken promise. Bridget McKenzie, Patrick has just said that it’s not many people, even though in 30 years’ time it will be one in ten. What’s your reaction to his comments?
BRIDGET MCKENZIE, NATIONALS SENATE LEADER: Look, I just find it incredible, but not surprising. Again, Sharri, this is a broken promise. They played a very small target at the last Federal Election and they are elected saying there wouldn’t be any changes to the superannuation system that 20 year olds, 30 year olds, 40 year olds and even 53 year olds invest in to ensure that they’re not a drain on the public purse come retirement time. Labor’s changes are making sure that, as you allude to, potentially, millions of Australians’, super balance and ability to provide for their retirement is undermined. And we followed up in the Senate today with the Finance Minister, Katy Gallagher. There’s obviously concern about how they’re going to treat unrealised gains in self-managed super funds, which many primary producers and small business owners across the country use that method. And they could not answer simple questions about how many farmers are affected, what sort of their modelling told them about that, and how many tens of thousands of dollars primary producers are going to have to pay on the back of this decision? Or are they actually going to have to sell in what many cases are intergenerational assets? This is botched policy again by the Labor Party.
MARKSON: Patrick, very quick response to that. “Botched policy”?
MCKENZIE: Can’t even answer a basic question, Patrick.
GORMAN: Let’s be clear about the situation that we inherited from Bridget, the Liberal Party, the National Party, in May last year. A trillion dollars of Liberal-National debt on the table that all Australian taxpayers are now forced to pay back because they let the budget rules go out the window.
MCKENZIE: During a global pandemic.
GORMAN: It started before the pandemic. They built up half of that debt before the pandemic hit Australian shores. So, we do have to make really tough decisions. We’ve got families around the kitchen table and their homes making tough decisions about their budget. We accept responsibility to also make those tough decisions to ensure the long-term sustainability of Australia’s superannuation system.
MARKSON: Look, RBA governor Philip Lowe has been in hot water for months. We’ve been just talking about it tonight. Do you think, Bridget, that he’s getting the balance right between raising rates and not crunching the economy and not sending us into a recession?
MCKENZIE: Yeah, I think he’s walking a tightrope at the moment. Sharri. Getting the balance right. Tackling inflation requires getting your monetary policy, which is Patrick and his mob’s job, and your fiscal policy settings right, which is obviously are the independent RBA’s role. Now, they’re ratcheting up interest rates and Australians are struggling with the mortgage repayments as a result. They were told it was going to be cheaper under Labor. That is not the case. And that is having to be done because in the absence of a straightforward fiscal strategy by this Government that actually includes goals to balance the budget, they’re having to actually ratchet that up. Many economists for saying they’re not going fast enough, quick enough.
MARKSON: Very quickly Bridget, do you agree with Costello today that the RBA was too slow to tackle inflation?
MCKENZIE: I think the RBA is having to consider what’s in front of them: a government that isn’t taking the tough decisions on the structural issues of the budget, the NDIS relationships and funding with the state. Now, in the absence of that and the lack of confidence he has, the Board is making the decision they feel they need to, to ensure that inflation doesn’t get out of control in this country.
MARKSON: And, Patrick, do you think the RBA is being too aggressive in raising rates after promising Australians that they wouldn’t touch them until 2024?
GORMAN: Well, the RBA makes these decisions independently, so I won’t give them free advice on your program. What I will say, though, is that this is, of course, tough news for millions of Australians. And I think we just have to acknowledge that. That anyone who is feeling those struggles of balancing their family budgets, it’s difficult. It’s been forecast and it was forecast and this is a process that started when Scott Morrison was Prime Minister, when we started to see those interest rate increases happen. But what we need to do as a Government is, as I say, take responsibility. And that’s why we’re doing where we can practical things, to act on cost of living pressures, where we can without impacting on inflation, because it is a very delicate balance. That’s what we’ve gone for.
MARKSON: Let’s move on so we get some more topics in. I interviewed Scott Morrison on the program last night. He says Australia couldn’t possibly defend ourselves against China. And he also argued that we should be increasing Defence spending to 2.5 per cent. Have a quick look.
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MARKSON: Shouldn’t we be able to stand alone? Shouldn’t we invest in our defence budget even more so that we could withstand … ?
MORRISON: Well, yes, I think our defence budget needs to get to two and a half percent of GDP …
MARKSON: But it’s clearly not enough.
MORRISON: Well, I think we need to get to two and a half percent.
MARKSON: Patrick, should we increase defence spending to two and a half per cent?
GORMAN: Well, former Prime Ministers are entitled to their views. I’m not sure that all of Mr Morrison’s colleagues be welcoming his interventions right now, but that is entirely up to him.
MARKSON: But what do you think about the need for more spending?
GORMAN: Well, I would have thought, let’s not forget that for the last two years that he was Prime Minister, Scott Morrison was also the secret Treasurer of Australia. So, if he really thought this when he was in Government, he could have done something about it. Maybe the only thing that he had failed to do was also to swear himself in as secret Defence Minister as well.
MARKSON: Fair enough.
GORMAN: But when it comes to sensible strategic defence policy, we will, of course, as a Government respond to the Defence Strategic Review which the Prime Minister and Defence Minister received last month. And that’s where we’ll outline where we see the forward investment in our Defence capability.
MARKSON: Bridget, very quick final say on this. Are you worried that we can’t defend ourselves against China?
MCKENZIE: The risk is real, it’s close, and we need to spend and adopt that appropriately. Increasing our spending commitment is, I think, something we should be looking at as a country. My gravest concern is that the Labor Party will see this as a cheap, lazy Budget get under the pressures they’re at. Under the last time they were in government, they cut our defence spending to the lowest level since World War II. We built that back up. And so, in light of the threat, which is imminent …
MARKSON: You agree with Morrison, we should now be looking at increasing that perhaps to two and a half per cent
MCKENZIE: I wouldn’t be cutting defence spending. I think that is a grave concern across defence and the community more broadly, that that’s the first place the Labor Party is going to look in May.
MARKSON: All right. Patrick Gorman and Bridget McKenzie. Thank you both very much for joining me.
