Sky News – Richo Program
E&OE
GRAHAM RICHARDSON:
And thanks for staying with us here on Richo. In, I’m not sure, it’s from our Melbourne Studio I think is Kevin Andrews, is that right Kevin?
MINISTER ANDREWS:
Yes I am Richo.
GRAHAM RICHARDSON:
(Inaudible), they don’t show me pictures of you until now, so I can now see you so that’s good.
Now can I just start off with Budget, I mean pretty obviously it won’t come as a terrible shock to you for me to say the budget’s not terribly popular. Your government has suffered pretty dramatically; to be behind 55-45 in Newspoll would suggest that the message out there has simply not been heard. Now I want to ask you about a couple of measures in the budget for which you are responsible, which I think are particularly difficult. I don’t know how you say to a family out there, a low income family on $60,00, $70,000, you know I think average weekly earnings is in the 60s these days isn’t it? I mean if you say to them look things are a really desperate and difficult and we need to address this problem now, so you take off them some $6000, you know eight per cent of their income and in some cases nearly ten. And then at the same times as you do that, you pay a woman $50,000 to have a baby. I mean I just don’t think that is saleable, the unfairness of it just sticks out, and it makes people very angry, why do you have to have to stick to that Paid Parental Leave scheme? I mean if we are in so much trouble, we do have to cut the Budget, why spend billions on that?
MINISTER ANDREWS:
Well two things Graham. The first thing is that, you know, you take the person or the family on the average wage, which you’re correct is around about $60,000 these days, that family depending on the number of children and the configuration of the children, can still be getting up to $20,000 by way of Family Tax Benefits, and that’s not including, for example, childcare benefits or if they’re renting, rent assistance etcetera. So there are still quite substantial payments being made by way of family allowances, if you like, to a family in that situation.
But you know the bottom lines is we still have a difficult fiscal situation, we’ve got to fix the debt and deficit situation which we inherited, so that’s the first point. The second thing is the Paid Parental Leave Scheme is not a welfare measure, it’s a workplace measure. The challenge we face in Australia in relation to work and family is two-fold. Firstly we need more workers particularly because of the ageing of the population and the contraction in the net growth of the workforce, which is going to be quite significant in the next ten years. But secondly we also need more babies, and somehow you’ve got to get this balance right and that’s what we’re trying to do.
GRAHAM RICHARDSON:
Yeah look I understand what you’re trying to do but the reason, well one of the reasons why I don’t believe you’re selling it, why the Government has got itself so unpopular so quickly, there’s just for people on that $60,000 there’s just a manifest unfairness in saying here I am on 60, you want to take $5000 or $6000 off me, and then you want to give this woman $50,000 to have a baby, and people just aren’t buying it. I don’t understand why people like yourself, cause you’re not stupid you’re in a Lower House seat so you must be getting the same message that everybody else is getting. I don’t understand why on the Paid Parental Leave Scheme you can’t take a deep breath and say whoops maybe we got this wrong and we’ll have another look.
MINISTER ANDREWS:
Well we’ve made some changes, as you know, we’ve come back from $150,000 to $100,000. You’re only going to get the $50,000 if you’re actually earning $100,000, and you know for a lot of people on the $60,000 that you talked about well then 50 per cent of their income is half of that, about $30,000. But you know if you’re a public servant, if you work for someone like me, if you work for a university you’re already getting these entitlements, who’s missing out? It’s the person who’s working in a retail business. It’s the ordinary worker who is unfairly treated by the arrangements at the present time.
GRAHAM RICHARDSON:
I actually, I don’t disagree with that. It’s just the unfairness of the amounts. You just said they are on $60,000 and they can get $30,000. The problem is, and I made this comment in my column the other day, every baby is precious, and every baby ought to be worth the same amount of money, one baby shouldn’t be worth more than another. I won’t labour the point, we could go on about it all night there are so many other things I wanted to talk to you about.
Now Family Tax Benefit A and Family Tax Benefit B, now where are we going with those, they’re talking about $100,000 limit. Can you clear this all up for us?
MINISTER ANDREWS:
What we’re proposing to do with Family Tax Benefit B is to reduce the upper threshold from $150,000 to $100,000, and to pay the Family Tax Benefit Part B until the youngest child turns six. So that would mean for the average family who’ve got two to three children, provided they’re earning less than $100,000, they would continue to get Family Tax Benefit Part B for probably up to about ten years or so. Now again this is trying to get the balance between having people, family members women in particular in the workforce, but also providing some payments which are an encouragement to have children, both of which we need, workers and children.
GRAHAM RICHARDSON:
No I see that but I think one of the problems that I also see with it, and why I think there’s a lot of anger out there is for someone like me I can play with my super and do really nicely and yet you haven’t touched that.
I remember, I remember well, when Peter Costello had to look for places to cut in ’96 he went straight at rich man’s super, why didn’t you?
MINISTER ANDREWS:
Well we’ve put the additional charge in terms of high income earners. So if you’re over $150,000 a year, first of all you’re already paying probably close to $60,000 worth of tax and then you’re going to pay more on top of that, so we’ve still got a very progressive tax and welfare system. If you’re back at the minimum wage level of $30,000 a year, coming back to family tax benefits, you’re still going to be getting somewhere in the order of $30,000 tax-free in addition to your income by way of family tax benefits. So the system remains very progressive.
GRAHAM RICHARDSON:
When you talk to women about getting back in the workforce, it would be no surprise to you to hear that most of them complain about the extraordinary costs of childcare, which in many cases women simply say it’s not worth me going to work because they’ve got to pay so much in childcare and get nothing at the end of the week anyway, what do we do about that?
MINISTER ANDREWS:
Well it’s very true, the cost of childcare has gone through the roof over the last five six years or so. We’re waiting on a report from the Productivity Commission, there was some speculation in one of the newspapers today about what may or may not be in that report, but we haven’t yet seen it. Once we get it and that’s a report to the government not a report from the government. Once we get it there will be a further period of consultation by the PC, the Productivity Commission, and then as I understand the timeline they’re due to make their final report to the Government in about October of this year.
GRAHAM RICHARDSON:
Okay now one other issue, cause as I said there’s so many. I’m rushing through them, I’m not doing each one of them justice, but I’ve got to get a comment on each one. Now there are changes to Newstart aren’t there for young people? And it seems to me one of the effects of this is to simply put people back in to mum and dad and saying well you know can you give me another quid, I mean is it really worth your while doing that?
MINISTER ANDREWS:
Well if you look at the people who are exempted from this Graham, so first of all its young people (inaudible), secondly if you’re in training then you are exempted, thirdly you have to be capable of working more than 30 hours a week, so in other words you’ve got to be capable of working full-time. You can’t be a part-time apprentice, you can’t be in a disability employment service, and you can’t be parent or have 35% of parenting responsibility, so someone in a separated relationship that’s still got a substantial parenting responsibility. So when you take all of those exemptions out what you’re left with is essentially people under 30 who are not working and not training, but are capable of working full-time. And all we’re saying is that if you’re not in a job then you’re capable of being in a job, so you should be doing some training to get yourself into a job, so that you can be in employment in the future, and we think that’s entirely reasonable.
GRAHAM RICHARDSON:
Well I’m not sure you’ve convinced everybody of how reasonable that is yet.
MINISTER ANDREWS:
I’ll keep trying Graham.
GRAHAM RICHARDSON:
Well I’m sure you will, that’s your job. Now what I’m really surprised about though is the release of the McClure report this week. Now it just seems to me it’s like World War Two, you know, the war is not going well on a number of fronts and then you race off and invade Russia and you get into trouble. Why start a whole new argument because this McClure Report doesn’t give you one bushfire to put out there’s about 50 in it?
MINISTER ANDREWS:
Well if we’re going to do some changes it’s obviously important to get on with them Graham. I mean you were a Senior Minister in a Government for a long period of time and you know that what you have to do, you have to do as soon as you can and up front. It’s been six months or so since we commissioned McClure to come up with a discussion paper, this is an issues paper it’s out there for consultation now and then they’ll report to us back in about October and at that stage we’ll start to make decisions. But unless we have the national conversation about the welfare system then nothing’s going to change and the reality is we’ve got 830,000 people on the DSP, increasing by over 1000 people a week, we’ve still got far too many people who are on unemployment benefits some of whom get back into a job quickly and some of whom don’t. So these issues are still there and at the same time we’ve got a rapidly ageing population which is going to hit us over the head very quickly if we don’t do something about it.
GRAHAM RICHARDSON:
Look I understand all that but, I mean, I can remember when I was Social Security Minister, what in 1991, so it was a long time ago but I was….
MINISTER ANDREWS:
The year I came into Parliament Graham.
GRAHAM RICHARDSON:
Is that right? Well you’ve been there too long, that’s all I can say, you’ll get institutionalised if you’re there that long.
MINISTER ANDREWS:
No I’m looking forward to beating Bill Hughes’s record mate.
GRAHAM RICHARDSON:
Well Phillip Ruddock will get closer than anybody I think. I can remember the same argument, exactly the same by the way, being put to me by the department when it came to disability pensions, this idea of the chronic diseases as against the episodic ones and I heard you say in a press conference a couple of days ago that you don’t have a definition, I would suggest that you can’t get one. I mean one of the problems here is that with depression, you know with epilepsy, with Asperger’s, there’s a whole range of things when you have good periods, and things are good for months and then you go bad again, I don’t know how you define that?
MINISTER ANDREWS:
I agree with you. If you look at the DSP now the largest cohort going on the DSP are people with a psychological or mental related illness, but a lot of that, and with including physical illness that is episodic in nature. That means that we should be looking, in my view, to the capability or the capacity of a person to work rather than just concentrating on the disability. Because what we’ve done, both governments for decades now, have said if a person is on the DSP we just put them there, we shove them into a back room and we forget them. Now I don’t think we should do that. I think, you know when I go and talk to disability advocates, when I go and talk to the disabled, most of them say to me I really want to work. So surely we can design a system that is actually capable of being flexible enough that when people are able to work and they want to work we can actually encourage them to work rather than saying ah it’s too bad you’re just on the DSP let’s forget you.
GRAHAM RICHARDSON:
Well look I hope you can. Well one last question It’s on disability again, one of the things that’s really irritated everybody, it’s got nothing to do with politics about whether you vote Labor or vote Liberal. It’s seeing these young men who’ve gone off to Syria and Iraq you know who apparently are so ill that they are on the disability pension here that they can throw off their walking stick and jump up and grab a gun and march off to war. Have we done anything about, which doctors signed off on them, are we looking at what happened, how did those people get a disability pension, I mean if the numbers are growing there must be some doctors giving them certificates far too easily.
MINISTER ANDREWS:
Well there’s been a tightening up of the test and the way in which the test is done, and we don’t simply rely on doctors now and to be fair to the previous Labor government they tightened it up as well. So there has been a gradual tightening over a period of time in which we have job capacity assessments which are not simply undertaken by doctors . But one of the things we’ve proposed in the budget is actually to restrict that portability, that ability to go overseas while you’re on a DSP, and bring it down to something like you know the 4 weeks that people can have for their annual leave. That seems to us to be a fair analogist situation and that’s one of the things we’re trying to do in the Budget, but I agree with you.
GRAHAM RICHARDSON:
But have a look at the Doctors who approve these, are we actually having a look at the approvals to say to ourselves, how is it possible that this fit young warrior ever got onto a disability pension?
MINISTER ANDREWS:
I agree with you entirely and there is a fraud control unit, as there has been for a long time in the Department, and they’re the sort of questions that I’ve been asking them.
GRAHAM RICHARDSON:
Well when you get the answers, I’d like you to come back on the show and give them to all of us because I think everybody would be fascinated to hear it. Kevin Andrews I’ve got to leave it there. I want to thank you very much for your time, there’s so much to cover on this and I do hope we can do that again.
MINISTER ANDREWS:
Happy to do that Richo and best wishes.
GRAHAM RICHARDSON:
Good on you thank you very much, Kevin Andrews in Melbourne.