10 May 2018




FRAN KELLY: Senator Penny Wong is a member of the Labor leadership team and she joins us in our Parliament House studios. Senator Wong, welcome back to Breakfast.


KELLY: Suddenly the pressure is all on Labor with this Super Saturday looming. Labor and Bill Shorten have a lot to lose don’t you?

WONG: Well, so does the Government. It is a test for the Government as well. Rising above all of this these by-elections will be a test of competing visions for the country. Do people support the $80 billion worth of tax cuts or do they want our education system funded properly? These are the issues which will be front and centre in these elections.

KELLY: I’m going to come to those issues. Three Labor resignations yesterday – Justine Keay, Susan Lamb and Josh Wilson. There’s the High Court ruling too against Katy Gallagher. No sorry from any of them yet. No sorry from Bill Shorten. Will you apologise on behalf of Labor to voters for getting this so wrong and stringing this whole citizenship fiasco along for so long?

WONG: Of course we regret that voters are being put to the inconvenience and cost of by-elections. Of course we regret that, but we acted on good faith and I don’t think there is any fair-minded observer who would suggest the decision yesterday in Katy’s case – and of course Katy self-referred – wasn’t a change. It was a change, it’s a much stricter test and a test we are observing. Hence you saw three Labor Members, as well as Rebekha Sharkie the independent in Mayo, stand up in the House yesterday and indicate they accepted the decision and would resign.

KELLY: It’s a clearer ruling but there were plenty of constitutional lawyers saying that after that ruling on the Matt Canavan case in October, it was clear the High Court was looking at a new interpretation of reasonable steps. Now, before that, sure, many accepted the ruling that Labor was working on. But after the Canavan ruling forget it, the only exception now is if the foreign jurisdiction operates to irremediably prevent renunciation.

WONG: Lawyers say a lot of things. I can tell you we acted in accordance with our legal advice.

KELLY: So did Barnaby Joyce and Fiona Nash and they got it wrong.

WONG: And I just remind you I heard the Prime Minister before opining again. The Prime Minister of the country stood up in the Parliament and said that Barnaby Joyce would not be found to be a dual citizen and he said “the High Court will so hold” on the floor of the parliament.

KELLY: And it did not. But the High Court “did so hold” on the Matt Canavan case and the interpretation after that was clearly changed.

WONG: Well there is an argument about that and I think the Gallagher case has made that clear and we’ve acted in accordance with the Gallagher case.

KELLY: And meanwhile three MPs have remained in Parliament, drawing salary and entitlements. Bill Shorten could have accepted the Government’s offer last year of a bipartisan approach to this citizenship issue.

WONG: As I recall what happened in the House – and obviously in the Senate we have been a little more civilised about this – but as I recall what happened the House was there was a discussion about joint referral of a number of MPs and the Government refused to take it. So let’s be clear. The law is clear. The High Court has spoken. It is a very stringent test. It is not a test that I think that any party, any party has complied with in terms of its vetting process. Labor’s vetting processes did rely on the law as it was understood to be. We have looked at the decision and accordingly we had people stand up in the Parliament and indicate they intend to resign.

KELLY: It does seem though that pretty much everyone except Bill Shorten, Mark Dreyfus and the Labor lawyers could see this judgement coming. Now Labor finds itself the focus, it finds itself under pressure. Bill Shorten’s political judgement is under pressure. Did you support this strategy to tough it out?

WONG: I’m not going to have discussions with you about internal discussions. Look, my view is you act in accordance with what you understand the law to be. And you might say lots of people thought it a change, well a lot of people thought it hadn’t and we acted in accordance with what we understood, and were advised that the law was. The High Court has spoken and we are now acting in accordance with that. End of story.

KELLY: Can you clear something up? One of the MPs who will now face a by-election, Labor MP Susan Lamb in the seat of Longman, according to Bill Shorten it is still not clear that she has been able to get her documents in order and renounce her British citizenship which, if it is true, is unbelievably slack. Can you clear that up?

WONG: I understand others are handling that process and I haven’t been engaged in the detail with that but I’m sure that Susan will act in accordance with the High Court decision before she nominates.

KELLY: Do you agree though there would be no excuse for any of the MPs now not to be prepared for this?

(phone rings)

WONG: Somebody has a phone in here! I want to be clear it is neither Fran’s nor mine (laughter).

Susan, any MP, will have to act in accordance with the decision that was handed down yesterday. And Labor people will.

KELLY: Are they ready to go now? Is she ready to go? I’m asking this because voters have a right to be angry and cynical if the politicians aren’t seen to be taking this seriously.

WONG: I have told you we are. Come on Fran, we’ve just had three people resign from the Federal Parliament without being referred on the basis of a decision made by a Labor person who referred herself. I don’t think in those circumstances it is reasonable for you to sit across the table from me and say that we here not taking it seriously.

KELLY: I think you know this is months after this could have been worked out. Now we are going to have Super Saturday. Five by-elections. One of them will be in Longman which will be a particularly tricky one for Labor. Susan Lamb holds that seat by just 0.8%. One Nation says it is going to preference the LNP. If Labor loses Longman is it going to get tricky for Bill Shorten’s leadership?

WONG: No. You know the test here? The test is whether Malcolm Turnbull’s $80 billion unfunded company tax cut is a good idea. That will be the issue front and centre in all of the seats which will be going to the by-elections on Super Saturday.

KELLY: Is there another test for Australia here more broadly? Should we be going to a referendum to sort out Section 44?

WONG: It’s certainly a very stringent test the High Court has now determined. But I think as Bill has made clear, if we end up having referenda we’d rather it was on issues such as the Recognition of our First Nations peoples and so forth. There are more important issues in our Constitution than resolving this. Parties now just have to apply the High Court decision to their processes.

KELLY: Let’s go to the Budget. Labor will want to turn the by-elections, as you have already indicated, into a referendum on the Budget. That means you will be fighting on the Government’s preferred ground of tax cuts. How can Labor go to the people arguing against $140 billion tax cut?

WONG: I don’t think you should just accept Malcolm Turnbull’s frame. This is not just about his tax cuts to working people. We’ve indicated that we support the first tranche of the tax cuts. The fundamental issue here is whether or not we think, the Australian people think, that we should give $80 billion to the big end of town while we cut schools and hospitals.

One of the most bizarre figures in all of this is that the same amount of tax cut that the banks are going to get under Malcolm Turnbull’s strategy is what he has cut from schools. So, $17 billion to the banks or $17 billion to schools. That is the choice voters will have.

KELLY: Okay, but the voters also have a choice about personal income taxes.

WONG: Not in these elections.

KELLY: They come in after July.

WONG: No, we have said we will support the tax cuts starting on the first of July 2018. Bill Shorten said that. Chris Bowen said that on Budget night. What Malcolm wants to fight on is a tax cut he reckons he will give you if you elect him twice – in 2024.

KELLY: Well what’s Labor going to do? Because Bill Shorten in his Budget Reply speech tonight is expected to say more about Labor’s tax plans.

WONG: Well I am sure you will be quite aware of it after he has given his speech.

KELLY: Is Labor really going to go into Super Saturday promising to put up taxes on high income earners, scrapping people’s tax imputation refunds, winding back negative gearing while the Government is promising big tax cuts?

WONG: You know what we need? We need a fair tax system and a fair tax system that recognises the importance of our schools and our hospitals, but also recognises that under this Government we’ve seen very, very slow wage growth. Now that is why we are supporting the first tranche of the tax cuts. What Malcolm wants you to do is to re-elect him twice. A bloke who hasn’t been able to hold a tax policy for more than a couple of weeks – remember the GST? And remember, what was it? Income tax for the states? Now he wants you to vote for him twice so he says he will give you tax cut which he hasn’t told you what it will cost. No one knows what the tax cuts in 2024 will cost which is the point the Senate crossbenchers made.

KELLY: In your own portfolio the Budget extended the freeze in foreign aid funding for another year which means it is locked in at $4.2 billion per annum up until 2022/23, which translates to a cut effectively of $141 million. Would a Labor Government unlock that freeze and how quickly aim to get foreign aid back above 0.22%?

WONG: A couple of points about foreign aid. The first is I think Julie Bishop has been a hard-working Foreign Minister but regrettably one of her singular negative achievements has been to preside over over $11 billion worth of cuts to overseas development, the lowest level of overseas development assistance ever. So, in terms of our national income account, if you count development assistance as a proportion of our national income by the end of this budget period will be at 19 cents in every hundred dollars of national income. So that has been one of her singular negative achievements.

In terms of what Labor will do, I made an announcement in February that we would commit to ensuring we spent more than the Government invests, more than the Government in development assistance. And that is for two reasons one is it is the right thing to do and the second is it about Australian influence.

KELLY: How much more than the Government? Will you be getting to back to that global measure of development?

WONG: We will make those announcements closer to the election Fran, because we do want to see the full fiscal position before we do. But I have made that clear.

KELLY: Senator Wong, another breaking story this morning an incredible upset it would seem, the former Prime Minister Mahathir Mohamad claiming victory in the Malaysian elections. The 92-year-old says he has got the seats needed to form government. This will be the first actual change of government in 60 years since Malaysian independence. What will that means for Malaysia?

WONG: It is a historic change, as you said. Barisan Nasional has governed since independence for over 60 years and we’ve seen a change in government.

But look whatever happens in Malaysia, we and the government of the day in Australia will work with the duly elected government. We have an interest, Australia has an interest and a hope that Malaysia is an inclusive and tolerant democracy and that democratic practices are observed.

KELLY: Mahathir has not often been a big fan Australia. He tried to keep us out of ASEAN. He has still got problems with our White Australia Policy apparently. Is this going to complicate relationships?

WONG: Well, the White Australia policy was pretty problematic wasn’t it? It means people like me wouldn’t have got into the country.

Look we work with whoever Malaysia elects but the broader issue here is in this region and for Malaysia itself. We all have an interest in a democratic Malaysia, a Malaysia which is inclusive, obviously multiracial and stable and our hope is that we will see that.

KELLY: Penny Wong, thank you very much for joining us.

WONG: Good to speak with you.

Authorised by Noah Carroll ALP Canberra