The Future of Disability Employment

Program:

6PR - Mornings

Interviewer:

Gareth Parker

E&OE

GARETH PARKER:

Christian Porter is the Social Services Minister and he joins me on the line, as he does most Thursdays.

Christian Porter, good morning to you.

MINISTER PORTER:

Gareth, good morning to you too.

GARETH PARKER:

We’re told that there is a high risk of the bells ringing. You’re in Parliament House in Canberra, it’s the last sitting week before the Budget, so if you have to race off we understand.

MINISTER PORTER:

I hope they’re timed with tough questions.

GARETH PARKER:

That’s the spirit.

Now, your Omnibus Bill – it was split and the part that remained, that’s gone through the House now, that’s right?

MINISTER PORTER:

It has yes.

What we’ve done is we’ve had two Bills that have crossed over from Senate to House. One of them contains all the reforms to childcare, and that involves a $1.6 billion investment in childcare across Australia.

That is going to make childcare more accessible, simpler, more affordable for all parents across Australia. That had to be paid for, and so the Bill that I was dealing with in the House, was the Bill that puts a freeze around Family Tax Benefits and makes some other savings inside the social security system. And that generates the money that pays for that reform.

It’s been a long time coming Gareth, because we’ve found it very hard to get support for the savings that we needed to pay for the necessary investment in childcare. But it’s now done.

GARETH PARKER:

Well that part of it’s done. But there’s a lot of other parts where you were hoping to make savings that haven’t been achieved. Things like, the clean energy supplement, paid parental leave – what happens to all those other measure that have been left out, the so-called zombie measures?

MINISTER PORTER:

The Government is still committed to those.

GARETH PARKER:

Ok.

MINISTER PORTER:

If I give you an example, one of those measures was close to a billion dollars worth of savings and that was effectively a measure to end compensation for the carbon tax for all new entrants into the welfare system.

Our view on that was that that money was meant to compensate for a tax that didn’t happen and for price increases that didn’t occur because the tax didn’t happen. And so – it doesn’t involve taking money off anyone – what it says is that that compensation shouldn’t be available for new entrants into the system. That would save a billion dollars for the taxpayer, and we would use that money to help fund the gap that exists for the provision of the NDIS in the year 2020.

GARETH PARKER:

So how come you can’t get that argument through the crossbench?

MINISTER PORTER:

Because we don’t think the crossbench necessarily see what is the reasonable position on every Bill. I mean, they disagree with us on some things. But, that particular measure – all the measures are committed to – but that particular measure, I think, is one where the argument is so strong to make the savings and to re-spend the money to fill the funding gap in the NDIS that I take a very personal view that that is something the crossbench can be absolutely be convinced of.

Now it didn’t make its way through in this particular Bill and the focus became on childcare and how you pay for that. But, I think it’s an eminently reasonable measure and it gives you a good example of really big savings measures where we spend the money on very important things and that would end up being part of further efforts on our part in the Senate.

GARETH PARKER:

It just seems as though you are having a very difficult time to make any real genuine progress on budget repair. And anything that’s even slightly politically difficult – you just can’t get it through. Who’s running the economic agenda, is it the Government or the crossbench?

MINISTER PORTER:

We take the world as we find it and the crossbench are obviously, very influential in legislation that we can have passed.

But the idea that we haven’t been successful in generating savings – we’ve had a very significant reduction in the growth of the Government’s recurrent expenditure since we came to office in 2013. And in my portfolio alone, we have achieved in excess of $20 billion worth of savings inside the system, much of which has been reinvested in other important areas – but has all contributed to slowing down a growth in expenditure which was just unsustainable, and which was having the effect of pushing on tax bills to the next generation of young Australians. They would end up having to pay higher tax to pay for our welfare spending today as well as having to take care of the welfare spending of their own time in 10 or 15 or 20 years’ time.

We have had very significant success, but if your observation is that there are also measures that we have found difficult to move through the Senate – I absolutely agree. We haven’t been completely successful, but we have been very substantially successful in a whole range of areas.

GARETH PARKER:

The company tax cut, which is at the centre of the Government’s economic strategy, the argument goes like this – that you need to cut taxes for companies – large businesses, small businesses – and by doing so you free up capital, you free up cash flow and big companies and small companies can employ more Australians.

Are you going to be able to get that through the Parliament?

MINISTER PORTER:

You’ve put the argument as good as I’ve heard anyone put it.

This is an argument about what Australia needs to ensure that we continue what’s been our fantastic streak of 25 plus years of uninterrupted economic growth. And there are many young Australians who can’t ever remember what it’s like to live in a time where there wasn’t economic growth.

But that doesn’t happen by accident. And part – and a very important part of that – is ensuring that you attract investment from businesses, big and small, because it’s that investment that ensures employment and economic growth and all of the opportunities that we have enjoyed seamlessly for 25 years.

Will it get through? That negotiation is going on now. I understand we will be sitting very late this evening.

GARETH PARKER:

Right.

MINISTER PORTER:

Those negotiations are in a delicate point.

GARETH PARKER:

Did you pack you pyjamas and your toothbrush?

MINISTER PORTER:

We’ve got all of that, and the running gear in the office mate – in case we get a dinner break.

But this could go to one or two o’clock this evening.

We’ve had the very senior figures from the Business Council of Australia in Parliament last night talking to…

GARETH PARKER:

Have they left that run a bit late, shouldn’t they have been lobbying some time ago to help you out?

MINISTER PORTER:

Better late than never, Gareth.

But I think that there is a bit of a sense that some of that advocacy should have been harder and earlier, but nevertheless it’s very persuasive.

When you’ve got significant corporate figures in Australia saying that this is the path to greater economic growth, to more jobs for the next generation and the present generation of Australians to having real wages increase over the medium and long term, I think that’s a very persuasive argument.

What’s interesting about it is that all of the crossbenchers have received these delegations from the Business Council of Australia. I understand that they have been very long meetings, and I think that the case for these tax cuts is utterly persuasive.

Of course, it was the case that was made for years and years by Bill Shorten and Chris Bowen. They have written books, in fact, about how important it is to ensure that our tax rates are competitive. And it’s also the case that a lot of the businesses that benefit first and earliest are the smaller businesses – so those businesses that will only have a small number of employees and that have a smaller turnover. They are an absolute engine room of employment in the Australian economy, and we just cannot let them become uncompetitive.

GARETH PARKER:

Since we last spoke the Commonwealth Grants Commission handed down its determinations for the GST for the next financial year. Here in WA, as you know, the West Australian Treasury had an anticipation, an expectation, that we might get 38c in the dollar, in fact it’s 34c in the dollar – that was announced during my show on Friday.

What happened after that, Christian Porter, is that the phone lines lit up and people were outraged.

What I kept hearing from listeners of this show is that many of them who are lifelong Liberal supporters, by their own telling, will not vote for the Liberal Party at the next federal election unless this issue is resolved. We heard it time and time again on Friday, and then I kept getting emails over the weekend to the same effect. So these aren’t swing voters, they’re not Labor voters, they’re Liberal voters – some of them in their 60s who have always voted Liberal who are now saying, ‘you know what, I’ve had enough’.

This must be of deep concern, especially to you given the margin that you’re on in Pearce.

MINISTER PORTER:

I don’t view it as a concern in an electoral sense Gareth, I don’t.

The concern is the way in which the process is unfair to WA. The concern is the way in which the equalisation process in the Grants Commission is shockingly inefficient in terms of the way that it effectively penalises states like WA who invest in extractive and resource industries and grow their economy. But, I have said for eight years – from the time I was in State Parliament, State Treasurer right through to now that if what is being driving frustration is that a quick fix hasn’t materialised then that is a very difficult situation because there simply is not a  quick fix here.

And, the notion that this can be fixed with the stroke of a pen by a Treasurer, it’s both incorrect and, I think, just feeds into the frustration.

So I share the frustration of every one of your listeners. I’ve been in federal Parliament for three years, and over that time myself, Mathias Cormann, Julie Bishop – we’ve managed to recover close on $2 billion worth of our lost GST money, and that has been a massive grind. And that’s $2 billion more than any other group have managed to achieve, it’s not enough and there’s more work to do, and the situation is immensely frustrating. But this notion that there’s some kind of one -stroke of pen fix out there is just incorrect, unfortunately.

GARETH PARKER:

How often do you see Scott Morrison, by the way?

MINISTER PORTER:

Very regularly.

GARETH PARKER:

Next time you see him, can you just do us a favour and just ask him if he’d come on my show to talk about this GST issue?

We’ve been asking for him all week, and he’s been busy, I get that, I understand. But maybe if you could just put in a good word on our behalf? Tell him that I’m a good bloke…

MINISTER PORTER:

As we have such convivial relations, I’ll give him a nudge in your direction.

He is in the middle of putting the budget together….

GARETH PARKER:

I understand that, he’s a very busy man.

MINISTER PORTER:

And I talk to Scott about this issue with great regularity. One of the myths that gets perpetuated is that somehow or other, he can get a recommendation from the Grants Commission, and I don’t like how the Grants Commission operates – I think the formula is  completely confusing…

GARETH PARKER:

It’s perverse.

MINISTER PORTER:

It is. It completely is.

GARETH PARKER:

It’s a disincentive to economic growth. Not just for WA, but for the whole nation.

MINISTER PORTER:

And this is an argument that has to be – we have to keep on making and, when you look at the way in which the Prime Minister wrote to the Premiers of all the other states when he was suggesting a floor as relativities increased, I mean what he said was when – I’ll just use his words – “when one jurisdiction ends up receiving less than a third of what they would have received if GST revenue was distributed on a per capita basis, as has recently occurred, this unquestionably challenges public confidence, as it has done in Western Australia.” And that’s public confidence in the entire system.

But this notion that pursuant to the intergovernmental agreement, which we agreed ourselves into, sadly, in 1999 that the Treasurer can just ignore the recommendation of the Grants Commission with the stroke of a pen, have a substantive change to the relativities, it simply and unfortunately is not true.

GARETH PARKER:

Alright, can I hear the bells there, or are they Senate bells?

MINISTER PORTER:

They’re Senate bells.

GARETH PARKER:

One more question for you, it’s on the NDIS.

I just had the Premier, Mark McGowan, in the studio, and a caller wanted to know if he would stick with the arrangements whereby the state would run the NDIS here in WA, or whether it will hand it over to the feds?

MINISTER PORTER:

I didn’t hear it, what did he say?

GARETH PARKER:

What he said was that he didn’t know and he was still considering that issue.

But he said that he wanted to understand what the savings could be by handing it back to the Commonwealth and also what the implications would be for the care of people with disabilities in this state.

So he’s open to the question. From your point of view are there savings to be had for Western Australian taxpayers if in fact WA – the new WA Government reverses course and hands this back to the feds.

MINISTER PORTER:

Can I just say I’ve had some conversations with new State Ministers, Peter Tinley and Ben Wyatt. I haven’t had a conversation from State Ministers on this issue, obviously they’re welcome to pick up the phone and start that dialogue.

On the two questions – what difference does it make to first of all the care standards, none really. The whole point of the deal with the WA was that if WA wanted to administer their variant of the NDIS, they would have to do it within very tight parameters and there are a range of quite detailed conditions, and they were designed to ensure… that’s me… they were designed to ensure that here, across the states was even.

As for the financial aspects, we concluded the deal with WA, and we’d have to talk with Mark McGowan and his Ministers about that.

But Gareth, I’ll have to leave you with that and I’ll have a chat to Scott for you.

GARETH PARKER:

As someone else used to say, you’ve got to zip.

Thanks Christian. (ENDS)