Transcript by Hon Kevin Andrews MP

Bush Telegraph, ABC Radio National, 20 May 2014

Program: ABC Radio National

QUESTION: With me today is Kevin Andrews who’s the Federal Minister for Social Services. Thank you for joining us Minister.

MINISTER: Good morning Cameron.

QUESTION: Let’s start with the National Rental Affordability Scheme, why was that cut?

MINISTER: Well we looked at the National Rental Affordability Scheme when we came into Government and there are very many deficiencies in the way in which it had been operating and rolled out. This was aimed at providing within a relatively short period of time 50,000 new dwellings, currently there’s only about 20,000 after a number of years that have been constructed. There’s about another 18,000 that are at different stages of construction, or maybe not even construction. On top of that there was inappropriate use of the incentives, housing for international students at universities rather than for local workers and poorer Australians, and there’s been a trading in the incentives. So much so that we know that some of these incentives have been traded on the open market for up to $20,000. So having looked at it…

QUESTION: Are you scrapping the entire scheme because a few people rorted the system?

MINISTER: Now we’re not. What we’re doing is that for the 38,000 that have either been built, or in the process hopefully of being built, we will maintain that scheme as long as the timelines for getting them built are in place. For the remaining 12,000 we’re not proceeding with it at this stage because of those problems. In addition to that we will be looking at housing in a much more holistic way at the Commonwealth level over the next six months or so but this should be seen in the context of two things. Firstly that housing is primarily a state responsibility in Australia, but despite that the Commonwealth provides billions of dollars to the states for affordable housing. We provide, under the National Affordable Housing Agreement, about $1.3 billion a year, we provide billions of dollars in rental assistance from the Commonwealth each year and specifically for homelessness we’ve rolled over $115 million for 12 months while we have this examination of housing more broadly.

QUESTION: But do you agree with Ken Marchingo (CEO Haven Home Safe Bendigo) that this decision by the Federal Government will directly lead to more people homeless in regional areas, regional Victoria in particular in this case?

MINISTER: No I disagree with that because this was one measure, and a relatively small measure in the total amount of money which the Commonwealth provides to the states and others for housing and all we’re not doing is proceeding with a measure. This is not going to lead to any further homelessness and indeed as I said we’ve rolled over $115 million that goes from the Commonwealth directly to homelessness funding whilst we have a look at housing more broadly.

QUESTION: The scrapping of this particular scheme is one of many changes in the Federal Budget, Ken Marchingo made the point that many of the more vulnerable people in society will see their welfare benefits cut, how concerned are you that the broad range of changes will put unfair pressure on society’s most under privileged people?

MINISTER: The Commonwealth is still maintaining very significant and substantial payments through the welfare system, the total welfare bill is about $145 billion, much of that goes to families. If you take a single income family with a child under six on the minimum wage they’re getting about $20,000 in addition in Commonwealth benefits and that doesn’t take into account things like childcare or rental assistance if they’re in rental accommodation if they’re eligible for assistance. It doesn’t take into account other things such as the subsidies for visiting the doctor etc. If you take a single income family with $30,000 again who have got two kids between say 6-12 they are receiving about $20,000. All the way up to about $90,000, or more, people are still receiving $5000- $6000 in additional funding from the Commonwealth.

QUESTION: So is the current level adequate in your view, the current level of Commonwealth assistance to the most vulnerable people?

MINISTER: Well our situation is that we found ourselves inheriting a total financial mess, $123 billion worth of accumulative deficits, $667 billion worth of Commonwealth debt if we don’t do something about it which means $25,000 worth of debt for every man, woman and child in Australia. Now we have to address that otherwise this is going to be a burden around the neck of the next generation.

QUESTION: But this is a question of how you address it and who ultimately pays for that debt.

MINISTER: That’s right and what we’ve done in relation to these things is try to ensure that all Australians make some contribution to the mess we’re in at the present time, but as I said if you’re on the minimum wage with one or two or three children you’ll be receiving somewhere between about $20,000 and $30,000, even more from the Commonwealth in terms of direct family payments. So there is still a very significant contribution the Commonwealth is making but we’ve had to actually look at the overall situation because at the moment we’re in a situation where the previous government borrowed not for the future but from the future.

QUESTION: But the question is not over the contribution, the dollar amount the financial contribution the Commonwealth is making, the question is whether or not the people on the lowest incomes, single mums or low income families or the unemployed will actually see a real cut in what they receive from the Commonwealth and what that means for their living standards. Do you accept they will suffer a cut to what they get in their pocket?

MINISTER: Look we acknowledge, and that’s the basis of this budget, that we’re asking all Australians to make a contribution. We’ve tried to be fair about that in terms of the contribution which they are making. If the Labor Party were serious about this they’d pass the carbon tax repeal now which is a $550 per year benefit to the average family in Australia. We’re not doing this because it’s a popular thing to do; we’re doing this because it’s right for Australia and the national interest because if we don’t do it then we face real problems.

Today the credit rating agencies have been saying there’s a danger that the credit rating will be reduced, what does that mean on top of the billions dollars worth of interest that the Commonwealth is paying. If the interest rates are forced up we’d be paying more interest which means an even greater burden into the future. So as I said this is not a popular budget in the sense that we’re seeking people to say yes this is great, this is wonderful we can keep on borrowing and spending, we’re saying we’ve got a problem in Australia. People listening who run their own business, who run their own family household budget know you can’t keep on borrowing for the future.

QUESTION: Is there a risk that people living in regional and rural areas of Australia where services are already limited and the cost of living can be higher, that they are suffering unfairly with the cuts that you’ve made, they are bearing more of the costs than those people in the cities in Australia?

MINISTER: Look I grew up in a rural area myself, most of my childhood until I left to go and study in a capital city was in a rural area. I know very much the experience of a rural area; most of my family still live in rural Australia. So we’ve tried to be fair to people right across this country whether they’re living in a suburban area of a capital city or they’re living in a small country town but it’s difficult because we inherited a mess.

QUESTION: Many of your National Party colleagues represent (inaudible) electorates across Australia. What sort of reaction are they getting from their constituents?

MINISTER: Look they understand the situation whether they are National Party colleagues who represent rural areas or many Liberal Party colleagues that represent rural areas as well. They understand that, we discuss these things in the National and Liberal Party Room. People I think they understand the problem we’ve got and if we can start to get out of this problem with the plan we’ve got in place then that means down the track in a few years’ time we can actually start to ameliorate some of the changes. We’re the only people with a plan to try and get out of this mess and that’s what we’re proceeding with.

QUESTION: Minister thank you for joining us today.

MINISTER: My pleasure.