Doorstop interview, Sydney

E&OE

MINISTER MORRISON:

The Intergenerational Report shows that doing nothing is not an option. If we just sit on our hands then obviously things like the pension and other forms of welfare payments come completely unsustainable. The government has put up a series of measures that haven’t been accepted by the Parliament, by the Labor Party, the Greens and crossbenchers. I am happy to talk about all of those measures and to look at better ways we can make all of these payments, but particularly pensions, sustainable. The Labor Party has said that has to come completely off the table. They don’t want to start a conversation on having a sustainable welfare system, they want an end of conversation and I just don’t think that is a very constructive way to approach what is a very important debate for the country and we encourage those to engage with us who are prepared to put forward ideas, to put forward solutions to the joint challenges that we face.

QUESTION:

Can you confirm that you have offered an alternative model to the change to the way the pension is calculated?

MINISTER MORRISON:

In the Intergenerational Report the modelling demonstrates that once the budget is in a far more stable position then returning to an average earnings track would be an achievable goal. That would, I think, be something sensible to do down the track but I am quite open to the discussions with crossbenchers that I have already had about alternative ways the same sorts of outcomes could be achieved. What is disappointing is the Labor Party doesn’t want to be part of this conversation. Their only option is to do nothing and sit on their hands and pretend the problem will just go away and I don’t think that is very responsible.

QUESTION:

Can you explain in practice how this amendment to your proposal would work?

MINISTER MORRISON:

Well the proposal is just simply a projection at the moment in the Intergenerational Report. Right now it is a matter of talking through with the crossbenchers the best way in which we can have a sustainable management of the pension over time.

QUESTION:

So instead of it being reduced to inflation permanently it would be reduced to inflation until the budget returns to surplus?

MINISTER MORRISON:

The Intergenerational Report shows that after a period of time and once the budget is healthy again that we would be able to track the pension increases on a more sustainable basis to match average earnings.

QUESTION:

Does this mean you agree with analysis from some academics that you would be driving pensioners into poverty down the track if you did proceed with just linking it to inflation?

MINISTER MORRISON:

That has never been our intention. That is what is reflected in the Intergenerational Report’s projections. So I think the government’s intentions here are very clear and they are mapped out in this very official document which reflects the government’s position. But again we are very open to work through other alternative scenarios that make the pension sustainable on one hand but also ensures that it meets the adequacy test over time for people who rely on that pension.

QUESTION:

Now you have indicated Labor’s – you understand Labor is not prepared to negotiate on this, what words are you getting back from the crossbench about this proposal?

MINISTER MORRISON:

Fortunately the crossbench is being more pragmatic than the Labor Party. The Labor Party simply wants to sit on its hands and do nothing. That is not a responsible position for a sustainable pension into the future. Remember it is not just the aged pension, there are others – disability support and others that relate to this. The Labor Party linked Family Tax Benefits to the CPI. That is what they thought was good enough for Family Tax Benefits but when the alternative is arranged for the pension they reject it. Crossbenchers I am finding initially to be far more constructive about this and I would appeal to them to continue to engage with the government on this. Clearly the opposition does not want to be part of the conversation about a sustainable pension.

QUESTION:

If you can’t get it across the crossbench will you abandon this reform?

MINISTER MORRISON:

Well of course not because the reform of having a sustainable pension, not just for the current generation but for future generations is the worthy goal here. It is what we are pressing towards. This is the challenge we are seeking to address. The only challenge Labor is seeking to be trying to address frankly is their own popularity. Now that is no way to run a pension, that is no way to run a country. You need to focus on sensible, sustainable policy for our welfare system. That is what I think Australians expect from a government.

When do you think you will be testing it on the floor of the upper house or will it work that way?

MINISTER MORRISON:

We currently have bills before the Senate and when we are in a position on the basis of further discussion with the Parliament and its members – again I would reopen the invitation to the opposition not to be a conversation killer on pensions by simply just sitting on their hands and shaking their head but to engage constructively with the government about how we have a sustainable pension for the future.

QUESTION:

And if that reform did come into play would it be the year 2028 when you switch back to linking the pension to average earnings rather than inflation?

MINISTER MORRISON:

Well I think all of this is a matter for discussion and working it through with the parties who are prepared to be in the discussion about this. I am disappointed the opposition just simply don’t want to engage in an adult conversation about the sustainability of the pension. It is supposed to be Bill Shorten’s year of ideas. When it comes to the pension he has no ideas, no ideas whatsoever.

QUESTION:

Now are you getting positive feedback from Clive Palmer on this issue?

MINISTER MORRISON:

Well at this stage I have spent more time with the other crossbenchers on this issue. Clive has had a very clear position on this point I think for some time. But it is my hope as we continue to work through these issues that people can see as a result of the Intergenerational Report that doing nothing is not an option. Because if you do nothing on the sustainability of the pension a government in the future will have to take far more drastic action and that will be very bad for the pension and those who have to rely on it. Now I said a week or so ago that I think if we are going to make changes we have to start making them now. You can make them more gently if you do it over a long period of time. But the Labor Party seem intent on running this thing off the edge of a cliff.

QUESTION:

So running it off the edge of a cliff and taking drastic action, you are basically saying the government of the future is going to have to really get into pensions and really cut pensions?

MINISTER MORRISON:

Well of course they would. Labor just wants to kick this can down the road and pretend there isn’t a problem. Now the problem with that is eventually there is a day of reckoning when it comes to that approach. What we are saying as a government is let’s engage in the incremental changes we can make now in cooperation, as an adult Parliament, rather than the cranky approach of the opposition sitting on their hands and just shaking their head like a spoilt child.

QUESTION:

Do you think pensioners should be grateful for just getting inflation?

MINISTER MORRISON:

The pension is not a lavish payment. Everybody knows that and the pension has to have adequacy and that is the sort of discussion I am having with the crossbench and I would like to have with the opposition. We also need to look at the broad array of measures that are available for Australians as they age to continue to earn where they can, where they want to, where they have the opportunity to, where they can draw down on their own assets and other things to support their lifestyle as they grow older. We are growing older, we are growing older more healthily. That means we all have to think and plan for a much longer period of time on the other side of 65. Now I think that is good news. But once upon a time when there wasn’t that much life on the other side of 65 – certainly when the pension was first set there was no life on the other side of 65 because the average life expectancy was below that. But these days we need to plan for much longer lives. Individually we need to, we need to make our own decisions about our career transitions and how we plan for our retirement at whatever age we might choose to do that. The government equally needs to plan alongside Australians. So I am looking forward to having more conversations with crossbenchers and directly with older Australians about what they see as the realistic and incremental changes that can be made. I am just disappointed that the opposition just don’t want to talk.