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E&OE

PETER VAN ONSELEN:

Christian Porter, how are you going to sell tough medicine in your portfolio area? Because, at the end of the day – as I think you have already said and certainly the Prime Minister has said it, as have others including Joe Hockey in his valedictory speech – we will need to see cuts and tapering of costs in portfolio areas like yours, but people don’t like it.  People don’t like it when you take money away from them. 

MINISTER PORTER:

Well, in the measures that we have put before Parliament there are snakes and there are ladders but there are a lot of ladders in the package.  So, it’s a blend and we’re not saving as much as the first iteration of this package and that’s because we are giving a lot back to people. But, ultimately, the package is about trying to devise ways to increase female workforce participation amongst mums, single mothers, mothers in couple families. Historically, we know that that is occurring, we would like to keep it occurring, it can and should be a great engine room of the Australian economy and it’s great way to increase family wealth and prosperity. 

KRISTINA KENEALLY:

Minister Porter, forgive me, but your sales job today seems to almost involve a bit of a con-job.  That is, you released modelling –

MINISTER PORTER:

That’s very generous of you, Kristina.

KRISTINA KENEALLY:

But seriously, you have released modelling on these, the changes that you are proposing, and the modelling you have released includes or incorporates the childcare package which has not yet been released and you’ve only released modelling on families on who are going to benefit from changes from the childcare package. When are you going to release the childcare package? And when are you going to release the modelling that shows the impact of your proposed changes to family tax on those families that don’t receive childcare? 

MINISTER PORTER:

Right. So, it is true to say that the legislation around the childcare reforms is not yet in Parliament and one of the reasons, Kristina, why that’s the case is because we are waiting to know that we’ve got a mechanism to pay for that childcare reform series of measures.  But that is –

KRISTINA KENEALLY:

But your modelling released yesterday assumed that you knew what those childcare changes were going to be?

MINISTER PORTER:

There was a lot of information out about those childcare reforms – for instance, couples on $65,000 to $170,000 are very significantly better off per week with their subsidy to childcare, so – and that information has been known for some time – I accept that the legislation is not yet in Parliament but how it affects families on the ground, which is overwhelmingly positive in the childcare reform package, which is why it seems to have garnered crossbench agreement, and agreement from the Labor Party as to its desirability, all we’re saying is that you need a way to pay for that, which way should not be borrowing more money and increasing the deficit. So, the ‘somehow’ of how you pay for it is the package that I am delivering, but even inside this family tax benefit there are both snakes and ladders and the ladders are the important things. We are giving back to people in their Family Tax Benefit A, we are ensuring that there is $1,000 for couples with children under one years of age. But I think, to be fair, we are being absolutely upfront; we are making savings and redirecting the money, and the savings are being made by phasing down and removing end of year supplements and, again, we are being absolutely upfront – those are supplements that go to all families on Family Tax Benefit. So, they’re the snakes in the reform measures but those snakes are being reinvested into a whole range of ladders. 

KRISTINA KENEALLY:

This is getting slightly –

PETER VAN ONSELEN:

I don’t think a politician should be talking about snakes, by the way, Christian Porter. 

KRISTINA KENEALLY:

Yeah, just a bit of advice from the desk here. But anyway, so you are admitting you have got a childcare package you don’t know how to pay for, but you are allocating the benefits to families from a package you don’t know yet how you are going to pay for and you said that ladders are important, but you are not releasing information on how it is going to affect the families who are going to lose out. Why aren’t you releasing –

PETER VAN ONSELEN:

They will eventually, presumably?

KRISTINA KENEALLY:

Well, see back to the sales job, it seems like. I think the people losing out may want to know what they are going to miss out on, not everyone gets childcare.  Every one of the examples the Government released yesterday was an example for people who get childcare. Not everyone uses childcare. 

MINISTER PORTER:

Well, the overwhelming majority of FTB-A families, obviously with children under the age of thirteen, have the availability and the incentive to use childcare.  Now, whether they take that up for the purposes of meeting an activity test in the childcare reforms which has been explicitly stated, is a matter of individual secondary choice. Now, we can’t provide you with any kind of precise figure because that depends on behavioural results. The whole point –

KRISTINA KENEALLY:

But what about for the families of children over thirteen. They don’t have any availability of childcare –

PETER VAN ONSELEN:

Why are you defending this policy, it is a ridiculous waste of money, it’s a Howard-esque policy that Labor opposed at the time. 

KRISTINA KENEALLY:

I just want the Minister to give an answer to these questions. 

MINISTER PORTER:

Kristina, when you say that families with children over thirteen don’t have any availability of childcare, what I think you mean is that they don’t have the need for it, because what fourteen year olds –

KRISTINA KENEALLY:

Well, they don’t have the benefits.

MINISTER PORTER:

Yeah, correct. And look, again, we’re being unequivocal about that.  We’re removing and phasing out end of year supplements and we’re devising a policy approach that says, with respect to Family Tax Benefit B, that when your child turns thirteen, that money should end and come to an end. Now –  with some mitigatory payments for grandparent carers and for single parent families – but that when your child turns thirteen, having had the benefit of a childcare package up to that point, you should be moving back into greater workforce participation. Now, again, we are being unequivocal about that and there are a number of families in the Family Tax Benefit B stream, as you point out, that will have children over thirteen that will find the payments are removed, with some level of compensation, and they are also compensated with Family Tax Benefit A. But, of course, that is a policy measure designed specifically to increase workforce participation and remove an incentive in the system to passively accept payments. 

PETER VAN ONSELEN:

You don’t have to convince me, Christian Porter, you might have the age of entitlement types like Kristina Keneally here, you know wanting to hang on to this stuff. I don’t think you guys are cutting nearly hard enough – it is ridiculous. But I want to ask you about something else though that I think is ironic. I want to get your reaction to what I see is a bit of an irony here. On the one hand, back in 2010 we had former Prime Minister, then Opposition Leader, Tony Abbott spruiking this incredibly generous paid parental leave scheme. He stuck with it for year after year. He got an endorsement I suppose of sorts at the 2013 election. His colleagues, I’m guessing including yourself, didn’t much like it, but he stuck firm for a long time saying that this was really necessary because women needed to be supported. In the end he walked away from it. Whether that is a good or a bad thing, who knows, but he did walk away from it. Do you now see the irony though, that not only did you walk away from the generous scheme, but now you are also trying to remove the double dipping element where women were being called rorters on the way through. So, what we have been left with is an even less generous reality at the end of the whole process when it comes to paid parental leave scheme than was ever the case before?

MINISTER PORTER:

I think it is a fair assessment to say that paid parental leave schemes and policy have had a long history. As a Minister I look at it with a relatively fresh eye and take a mind to what’s fair and what’s reasonable. As you’re aware at the moment there is an $11,800 payment which represents 18 weeks at minimum wage, which is available to mothers to allow them to take 18 weeks out of the workforce and spend time with their child.  I ask myself this question; 20 per cent of the people who receive that payment also receive an amount from their employer in excess of that $11,800 and get to cumulate the two payments.  So, some people get the bare minimum and some people get a very large amount and those 20 per cent represent, generally speaking, well paid, well renumerated in generous employment funded packages for paternity leave, maternity leave.  I ask myself the question, is that a fair and reasonable use of tax payers money? And I think that that is a hard question to answer in the affirmative. 

PETER VAN ONSELEN:

But, Christian Porter, aren’t businesses simply going to react in other ways? So, for example, rather than by being generous with their paid parental leave schemes – I mean, that really Government should encourage rather than in a sense passively discourage by removing the double dipping – aren’t they just going to be, you know, think outside the square I suppose and give baby bonuses, we’ve heard that before during the Howard years, or something of the kind so that their employees can continue to collect the Government scheme? I think it sends the wrong incentive because it is a disincentive to businesses to do the correct thing that they are doing now.

KRISTINA KENEALLY:

We are going to be on a unity ticket –

PETER VAN ONSELEN:

Only on this issue, I’m not with you on the family tax stuff. 

MINISTER PORTER:

Well, I know that some, some in the business community have suggested that that is a possibility. But, if you look at the history of this, the reality is that the taxpayer funded government scheme of $11,800 of minimum wage over 18 weeks has for a long time coexisted with private employer funded schemes and yet we still have 20 per cent of the total recipients of the state scheme who are also receiving benefits from their employers in excess of the government taxpayer funded scheme. Now, that to me suggests that employers still have reasons to offer schemes to their employees in a sensible, negotiated fashion and that one system doesn’t crowd the other out. Now, in terms of design, you’ve got to be careful of those things, but I just don’t accept, based on recent history, that changes in one area automatically cause a sort of retraction from the field for a private enterprise. It doesn’t seem to have been the case. 

PETER VAN ONSELEN:

Well, we will find out soon enough I suppose if you can get the legislation through the Parliament. Christian Porter, new Social Services Minister, I appreciate your time, I know you’ve got to get to Question Time. 

KRISTINA KENEALLY:

Thank you. 

MINISTER PORTER:

Thank you.  Thank you both. 

(ENDS)