SENATOR THE HON PENNY WONG

LEADER OF THE OPPOSITION IN THE SENATE

SHADOW MINISTER FOR TRADE AND INVESTMENT

LABOR SENATOR FOR SOUTH AUSTRALIA

TRANSCRIPT

17 February 2016

ABC – CAPITAL HILL

TOPICS: GARY GRAY, LABOR’S PLAN TO FUND HEALTH & EDUCATION, NEGATIVE GEARING, SENATE REFORM, TIME FOR TURNBULL AND MORRISON TO OUTLINE A DETAILED TAX PLAN

E&OE - PROOF ONLY

GREG JENNETT: Penny Wong, as we speak we’re uncertain what the Government may do or not do on negative gearing, but because Labor has a policy to find savings in that area is it a given that you’d support any savings the Government might come up with ahead of the election?

SENATOR PENNY WONG, LEADER OF THE OPPOSITION IN THE SENATE: Well, we put our own policy forward which we think makes sense. We’re still waiting and I think the whole of Australia is waiting for this Government to set out some direction when it comes to the economy and the Budget.

Let’s not forget, Malcolm Turnbull tore down Tony Abbott in part because he said that Tony Abbott was incapable of providing the economic leadership the country needs. Since then we’ve had a lot of policy waffle, but no clear direction from the Prime Minister or this Treasurer and I think, everyone whether or not they agree with the options, would look forward to the Treasurer actually putting something on the table rather than just having a chat.

JENNETT: Labor has many people have described as a bold plan and that’s effectively to turn the tap off on established homes and negative gearing of them. There are other options available though, things like cap, limits on deductions, limits on numbers of property. If those options came up into in the interim do you rule them out?

WONG: We’ve done a lot of work on this policy and Chris Bowen and the team are to be congratulated for how much work they’ve done over a long period of time. There are always other options but we’ve settled on a policy which we think delivers not only savings to the Budget over the decade, but also focuses on new housing supply, so there is a housing affordability element to our negative gearing and capital gains tax policy matrix and we think that makes sense. We still look forward to the Government putting their policies on the table, as Jeff Kennett said, he thinks what Labor has done is a good thing and if you’ve got even Jeff Kennett saying that the policy’s got merit, you must be doing something right when it comes to the public policy debate.

JENNETT: Yes, but multiple industry groups have also suggested that Labor’s policy could distort the market and particularly the rental market. How have you been able to satisfy yourself that that won’t be case?

WONG: We said when we announced this, I think Bill and Chris said very clearly, we’re going to have a lot of people criticising this because a lot industry players have a particular interest in making sure the current arrangements continue. But we’ve got to look at what’s in the national interest and let’s remember, if this is a policy that’s about bringing on new housing supply, only 7 cents in every dollar that is spent through the negative gearing subsidy – and that’s what it is, an effective subsidy - goes to new housing, 93 per cent is on existing housing. So if the objective is to try and encourage new housing supply, then clearly it’s failing

But in addition, let’s be upfront about this, we need our budget, Australia’s budget, to maintain spending in hospitals, in Medicare, and in education. I know those things are not a priority for the Turnbull Government, but they are a priority for Labor and they’re a priority for the Australian people.

We understand we have got to match things that improve the budget bottom line to enable the budget to do the things Australians expect, such as fund our schools and our hospitals and make sure Medicare stays in public hands.

JENNETT: On that division, maintaining the spending but repairing the budget, I think Labor’s grand savings total at the moment is said to be running around $100 billion. How much of that is actually for deficit reduction?

WONG: This will all be clear prior to the election, as parties will be required to make sure Australians understand very clearly what our position is, what decisions we’ve made about improving the position of the budget, but also what decisions we’ve made about the investments I think are needed.

I think the school funding package that Bill’s announced is an economic reform as well as a social reform. This is about ensuring Australians in the future, our kids today and in the future, have the skills to be able to not only provide for themselves and their families and make the most of the opportunities of the 21st Century. It’s also about making sure our economy is strong and if our economy is strong then obviously that improves the position of the budget.

JENNETT: Let’s move on and get you to put on your Senate Leader hat now. It looks likely that the Senate will be asked, or the Parliament more generally asked, to reform Senate voting rules, pretty quickly. At the moment, does do nothing look the most likely position that the Labor Party will take?

WONG: At the moment we have yet to see legislation from the Government. Obviously there was a Parliamentary Committee, the Joint Standing Committee on Electoral Matters, which reported on the 2013 election and made a set of suggestions. I’m deeply concerned though that it appears to be the subject of a backroom deal between the Greens and the Coalition-

JENNETT: -But that’s only because Labor hasn’t really engaged on it so far. I think there was a view that they’d try to get bipartisanship?

WONG: Let me be very clear, I’ve been in the Senate a fair while and the thought of Bob Brown or Christine Milne doing a deal with Coalition to change the Senate voting laws would be pretty unusual, wouldn’t it. I can’t imagine them doing it.

We don’t want is under Senator Di Natale and Lee Rhiannon a backroom deal of which Australians know nothing other than what’s been leaked out – a couple of stories and a couple of comments to the media. We have concerns about what’s been negotiated behind closed doors. I think that’s time for Senator Di Natale and Lee Rhiannon, as well as the Government, to come clean about what has been negotiated.

JENNETT: Whether it’s some model that the Greens and the Government are negotiating or whether it’s the one that the Parliamentary Committee came up with, through what prism do you look at this issue? Is it about voters’ will and a system that reflects that or is it as some if your party view it, about what disadvantages or advantages the Labor Party?

WONG: I think that the principle should be an electoral system in which Australians can have confidence, which has integrity, which does ensure that the will of the voter is reflected best. But let’s remember a system which delivers a majority of the Senate to the Coalition would not be reflecting the will of the voter. The last election the Coalition got just over a third of the vote from the Senate, two thirds of Australians didn’t vote for the Coalition Senators and in effect over 3 million Australians didn’t vote for either Labor or Liberal or the Greens.

JENNETT: You think optional preferential, as it’s been discussed at the moment, could produce an outright majority for the Coalition?

WONG: I was concerned to see reports in today’s media which suggested that the Coalition could gain outright control of the Senate and if that’s the case, I think Lee Rhiannon has a bit of explaining to do to her supporters. Why she would countenance a position that would deliver the Coalition control of the Senate where the majority of Australians didn’t vote for them.

Let’s just remember, what would have happened in 2014 if the 2014 budget had been able to be passed through the Senate, Tony Abbott’s budget, had been able to pass through the Senate unamended because the Coalition had control of the Senate. I don’t think Australians would thank the Greens for that kind of outcome.

JENNETT: So faced with that possibility, status quo is preferable, don’t change the rules?

WONG: We haven’t seen legislation from the Government. We will obviously go through our proper processes, as we do, to consider what proposals the Government has and we’ll do that on the basis that I’ve outlined to you. But at the moment what we have is a backroom deal that no one knows about between the Greens and the Coalition.

JENNETT: It looks like your spokesman in this area, Gary Gray, won’t have much more of a voice to carry this forward. He’s quitting, in fact all three lower house members for Labor in the West are going, is that destabilising?

WONG: Can I first say on Gary, because I haven’t had the opportunity to say anything publicly because he announced last night. Gary has made an extraordinary contribution to the Labor Party, not just in Parliament, but obviously as National Secretary, over many decades. I remember Gary having a chat to me when I was a young up and coming Young Labor person and he gave good advice and he was very supportive. He’s been an outstanding contributor, we wish him well.

JENNETT: And his division or his branch there in the West, not in great shape at the moment?

WONG: Obviously this is an opportunity for a new generation of Labor Members from the West. It’s a tough job being a Member of Parliament from Western Australia. I think everybody knows that. People have made their decisions, they’ve put out there their reasons why they’ve done that, and this is obviously an opportunity for Labor, and a responsibility for Labor in the West, to ensure we deliver a new generation of Labor voices from Western Australia.

Let’s remember we have got a proud tradition from WA, obviously a former Leader of the Party Kim Beazley is a Western Australian, so we’ve got an important opportunity now I think to regenerate.

JENNETT: And there’s a bit of that going on across the Parliament right now.

WONG: There’s certainly a revolving door when it comes to Malcolm Turnbull’s ministry, that’s true.

JENNETT: Penny Wong, we’ll leave it there. Thank you.

WONG: Good to speak with you.