FRAN KELLY: Prime Minister, welcome to Breakfast.
PRIME MINISTER: G’day Fran.
KELLY: Before we get into it, a few listeners are keen to know how that strawberry curry went on the weekend?
PRIME MINISTER: There’s no such thing as a strawberry curry. I cook the curry, Jen cooks the pav and there were plenty of strawberries on it and it was smashing.
KELLY: Okay, so no strawberries anywhere in the curry?
PRIME MINISTER: Not in the curry, no.
KELLY: Not in the chutney?
PRIME MINISTER: You can do a chutney with a strawberry, but I didn’t get around to it. That takes a bit more time. But no, strawberries, I was pleased to see so many Australians around the country, particularly on the weekend, getting out there and buying strawberries. Please keep doing it, it’s helping the farmers.
KELLY: You’ve been Prime Minister now for one month and two days, you’ve hit the ground running. But I guess the question is, where are you running to? What is the grand vision? Because at the moment, it does look a little like you’re governing by daily announcement.
PRIME MINISTER: No, I reject that. I mean from the very first day I said very clearly that our objectives were straightforward; to keep the economy strong, to guarantee the essential services that Australians rely on, to keep Australians safe and to keep Australians together. And in each of the things I’ve been announcing over the last month, it has been all in that context. And yesterday’s final Budget outcome for 2017/18 was the best demonstration I think, of how our Government over the last five years has been doing the job of bringing the Budget back into balance, keeping the economy strong. Record jobs growth, youth unemployment coming down, unemployment coming down. These are the dividends that are paying off for Australians.
KELLY: Looking backwards, but also looking forward to how you’re going to govern, Malcolm Turnbull lost the job because some of you colleagues felt he’d ignored the more conservative Liberal Party base. He wasn’t speaking to them. Analysts say you can’t win an election from the right. How will you appease the base and persuade everybody that you’re governing for all of us and not a small rump of conservatives in your Party Room?
PRIME MINISTER: Again, I don’t accept that broad analysis.
KELLY: Isn’t that why Malcolm Turnbull lost the job?
PRIME MINISTER: No, no, I’m just simply being myself and continuing to stay faithful to the core values and beliefs of the Liberal Party, which I believe we have been doing over the last five years.
KELLY: Did Malcolm Turnbull fail at that?
PRIME MINISTER: No, I don’t believe so Fran. What I’m simply saying is keeping the economy strong - which is what pays for hospitals, schools, affordable medicines, Medicare, all of these things - that’s what we’ve been doing as a Government. That’s what I will continue to do as leader of this Government and that has always been the mainstay of why Australians trust Liberal and National parties to run the country. Because we run a strong economy. We keep the Budget under control, which means you can believe us when we say we’ve got record funding for schools and hospitals. Keeping Australians safe equally has been a big priority of Coalition Governments and it’s one we’re continuing to deliver on. But also bringing Australians together, around key issues like our social safety net, ensuring that we’re supporting all Australians to do better and we’re not setting one set of Australians against another by saying you’ve got to tax some more, to tax others less, or you’ve got to hit some people’s schools funding, to fund others.
We think everyone should have the opportunity to succeed in this country and we shouldn’t be seeking to punish some, to elevate others.
KELLY: I’m coming to the economy. You had some strong figures out yesterday and I’m sure you’re sick of looking backwards and being asked this question, but all the things you just said there, wasn’t Malcolm Turnbull doing those?
PRIME MINISTER: Yeah we were and it’s our Government.
KELLY: So was it just votes in the Party Room that he couldn’t gather?
PRIME MINISTER: Our Government was elected in September 2013. I’ve been a part of that Government from the day we were elected. From stopping the boats to balancing the Budget and I’ve served under two leaders and have been proud to serve under those two leaders and we’ve achieved a great deal. Our Government is still pursuing the policies that our Government was elected to do, to fulfil the promises that our Government made at the last election and we are delivering on those.
KELLY: Okay let’s get to the economy. There were some strong Budget figures out yesterday, tax revenue is up by $13 billion, welfare spending down by around $7 billion. Will you use this extra money to get back to surplus quicker, or will you spend it on election promises?
PRIME MINISTER: Well, we’ve got our trajectory in the Budget and that’ll be updated at the end of this year, as it always is.
KELLY: That’s the balance.
PRIME MINISTER: That’ll tell us - I mean what the final Budget outcome does, is tell us what happened in 2017/18. And that showed that in just two Budgets, we came from 2015/16 position of almost a $40 billion deficit, down to a $10 billion deficit in just two Budgets. That’s the best outcome for a financial year in a Budget in a decade. And as you say, it’s been achieved by a couple of things; a stronger economy is actually supporting revenues, particularly out of the corporate sector, but getting people off welfare and into work, that’s what’s seeing the social welfare budget come under control. Because when people go from actually receiving taxes in the form of welfare, to paying taxes by being in a job, that’s how we’re turning the Budget around.
KELLY: Okay just on to what your thinking is though, about the surplus? If this trajectory continues it should be possible, shouldn’t it, to hit surplus a year earlier? Do you plan to strive hard for that or do you strive hard to use the extra dollars for spending?
PRIME MINISTER: Well again, I don’t necessarily agree with the assessment about the trajectory you’ve outlined. I mean originally I said when I became Treasurer many years ago, that we would hit a 2021 surplus year.
KELLY: You’ve revised that.
PRIME MINISTER: We’ve said we can do that a year earlier in 2019/20 and I believe that remains the most –
KELLY: A balanced Budget in 2019/20?
PRIME MINISTER: That’s right, in 2019/20. There is about a $2 billion surplus in that year. Now we’ll update those figures at the end of this year to see how things are tracking out over the forwards, but I don’t think there’s any reason at this point to suggest that there would be any change to that trajectory.
KELLY: Let me put it another way; as Treasurer you had a bit of a golden rule that any new spending had to be offset with savings elsewhere in the Budget. Is Josh Frydenberg going to be operating under those rules?
PRIME MINISTER: Well, they’re the Budget rules.
KELLY: Still the Budget rules?
PRIME MINISTER: Yep.
KELLY: The biggest surprise was that lower welfare spending that you talked about. You said partly due to strong jobs growth, also lower than expected uptake of the NDIS. Is now the time to increase Newstart for all those who are still out of work? It’s been going backwards in real terms for 25 years, it’s been described by economist Chris Richardson as; “Unnecessarily cruel”. There’s a widespread coalition of support for increasing Newstart. Do we have the money now to do it?
PRIME MINISTER: Well, we’re still in deficit. We’re in a $10 billion deficit, so while that is the best result we’ve had in a decade, it’s still a deficit and the 2019/20 result is still, you know, it’s still a very modest surplus. So I don’t think you can all of a sudden go; “Oh, let’s make whoopee,” you’ve got to be –
KELLY: No, well there’s savings, there’s savings in the welfare entitlements budget if you like. Will you spend them in the welfare entitlements budget?
PRIME MINISTER: What we will continue to do is consolidate the Budget, get it in a strong position so we’re in a position to support the commitments we have made in additional schools funding, in additional hospitals funding, in affordable medicines funding, these are all big priorities, the NDIS.
I remember being on this program as Treasurer a while back and we were talking about, you know, I am guaranteeing full funding of the NDIS based on the improved trajectory of the economy and what that will mean for the Government’s revenues to support the NDIS. So my priorities haven’t changed. Now, the best thing I can do for someone who is not in a job, is get them in a job. And this Government has had the greatest success of any Government at getting Australians into work. And not just those who are middle-aged, but youth unemployment has fallen to its’ lowest level since before the 2013 election. More than 100,000 young people got a job in this same year. We’ve just had the financial budget outcome that is the strongest year of youth employment growth in Australia’s recorded economic history. Now, when a young person gets a job, this is my passion, that changes their life. It changes their family. They don’t live a life on welfare, they have choices, they look at the world differently. They look at Australia differently.
KELLY: Nevertheless, not everyone can get a job. You are not of the mind to increase Newstart? Is that –
PRIME MINISTER: It’s a very expensive undertaking and there is not the room in the Budget at this point to do that.
KELLY: One of your slogans since taking over has been - well not a slogan so much as a mission statement – “the fair go for those who have a go”.
PRIME MINISTER: It’s a belief, it’s a core belief of mine.
KELLY: A belief. But for the millions of wage-earners out there, who are watching company profits go up and their pay not going up, what are you doing to give them a fair go by increasing their wages, while the bosses are earning bonuses?
PRIME MINISTER: Well, we’ve provided tax cuts, that was the first thing we did in the last Budget.
KELLY: Is there any more you can do with business, with corporations, with bosses?
PRIME MINISTER: Ensure that they do well, so they can pay their staff more.
KELLY: Well they are doing well and they’re not paying their staff more.
PRIME MINISTER: They’re starting to do better. You need sustained increases in profitability you know, one swallow doesn’t make a summer. You need to have sustained increases in profitability. These are businesses that for many, many years were not making any profits at all, particularly small and medium sized business. We’ve given those businesses tax relief, quite significant tax relief.
Remember, the Labor Party wants to put up the tax rate for all businesses under $50 million, from 25 per cent to 27.5 per cent. If you vote Labor at the next election, you’re voting for a tax increase for small and medium sized businesses. So, we’ll continue to provide tax relief, investing in infrastructure around the country, I mean $75 billion worth. Combined with what the States are doing that has been one of the key reasons why our economy has been doing as well as it has over the last 18 months to two years.
That has filled a gap that was left by the reduction in investment after the mining investment boom and so that’s keeping people in jobs.
And of course I want to see wages stronger and I think we will see that in the future.
KELLY: You’re listening to RN Breakfast, it’s a quarter to eight and our guest is the Prime Minister Scott Morrison. Well speaking of a fair go Prime Minister, the Banking Royal Commission will hand you it’s interim report on the weekend, or Friday I think. Will you release it immediately?
PRIME MINISTER: That’s the plan.
KELLY: That’s the plan? If the report recommends criminal charges being laid against some of the worst perpetrators, will you make it a top priority of your Government to see that followed up?
PRIME MINISTER: Well I’m not going to prejudge what’s going to be in the report Fran and whether the Royal Commissioner is even proceeding to those types of recommendations at this stage I think is not clear. He certainly hasn’t indicated that that’s where he’d be going at this stage of the inquiry. But certainly, having initiated this inquiry, we’d be seeking to act on the recommendations they make. At this stage I don’t know what’s in the report.
PRIME MINISTER: I’m not about to prejudge it and let’s just see what it says and then we’ll take things from there.
KELLY: From everything we’ve heard though, would you expect criminal charges would be laid as a result of all of this that we’ve heard?
PRIME MINISTER: Well I couldn’t tell you –
KELLY: We’ve heard some shocking things.
PRIME MINISTER: Well of course we have and that’s why we have a Royal Commissioner, because the Royal Commissioner can make those judgements and they can make recommendations. I think Commissioner Hayne has conducted this inquiry in an exemplary fashion. I think his team has looked at all 7,800 submissions and more that have come in and considered all those cases carefully. So remember, this is an interim report. It’s not the final report and what the Commissioner choses to do in this interim report is really up to him. So let’s see what he has to say and then we’ll take it from there.
KELLY: If the Commissioner asks for more time, will you give it to him?
PRIME MINISTER: Of course, I’ve said that from the get go.
KELLY: The Government has received another report which it’s been sitting on for some time, the report, review of religious freedoms conducted by Phillip Ruddock. It was handed to the Government back in May. When are you going to release it?
PRIME MINISTER: Well, I’ve obviously only had that report as the Prime Minister now for a month –
KELLY: Has Cabinet not looked at the report?
PRIME MINISTER: We haven’t got to that stage yet, so I’m working with the Attorney-General on those issues now.
KELLY: This is obviously an issue in Malcolm Turnbull’s old seat of Wentworth. Are you waiting until that by-election is over before you release it?
PRIME MINISTER: No, I mean the by-election is not the reason. We’re working on the report itself and I’m taking that issue through with the Attorney in a very calm and sober way. But I think people in Wentworth know, people of faith in Wentworth, people of belief and for whom religion is very important to them, know that I have a lot of strong passions in this area. And I want to make sure that their religious freedoms are protected, I mean I was at a function just last night. One of the most upsetting things I saw as a young fellow was when you drive past Temple Emanuel up there in Woollahara and there would be security guards outside. Now, you know, this is Australia. I mean when I go to church on a Sunday, I don’t need security guards outside my church, or when my kids go to Sunday school. That’s the reality for Jewish Australians and I just think that’s appalling. And so religious freedom means something very special to that community and they know I’ll stand with them –
KELLY: Independent member –
PRIME MINISTER: As will Dave Sharma.
KELLY: Independent candidate rather for Wentworth Kerryn Phelps says that, you know, the Government is not releasing it because it’s got something to hide, it’s not being “fair dinkum” with voters in Wentworth.
PRIME MINISTER: That’s rubbish. I mean look, I respect Kerryn, she’s an independent and she’s been around in public life for a long time. But she seems to be spending a lot of time attacking the Government and attacking the Liberal Party. I think that’s a clear message to the people of Wentworth that she’s no friend of the Liberal Party. She’s not looking to do the Liberal Party any favours and as a result she’s not a Liberal and you shouldn’t believe her if she pretends to be one.
KELLY: No but as you say, this is an important issue for the people of Wentworth?
PRIME MINISTER: It is and I think the people of Wentworth know my views on this very strongly. But you know I’m not going to rush into this. I’ve been in this job for, as you say, just a month and two days, this is a very important issue and I’m going to work through it carefully with the Attorney. Then, there will be a process for taking that through Cabinet and then there will be a process of engaging the community on it.
KELLY: Prime Minister, one thing you have got instructed fairly early on flows from the treatment of women in your Party and you’ve instructed the federal Liberal organization to come up with a process to fix it. What exactly would you have them do to stop the backstabbing and bullying behavior that several of your MPs have publically identified.
PRIME MINISTER: Well, for a start I don’t think this germane to the Liberal Party. I mean you only have to go out to Lindsay and see the soap opera that was happening out there with Emma Husar and what was happening –
KELLY: Sure, but within the Liberal Party, clearly you recognize it’s a problem if you’ve instructed your organization to fix it?
PRIME MINISTER: I certainly haven’t seen anything as chaotic as that in my time. But that said, that said I’ve asked for the federal parliamentary Party to look at their processes, to assure that there are complaints processes that are both rigorous and effective. So they’ll look at what’s happening in each of their divisions and then they’ll look at what can be done on a coordinated basis nationally and I’ll leave that job to them. That’s their job.
KELLY: Kelly O’Dwyer says the process should be independent, do you agree it should be conducted by someone outside?
PRIME MINISTER: Well I think that’s what a rigorous process does. I mean I think that’s implicit.
KELLY: Two women in your Party Room have quit ahead of the next election, another two have missed out on preselection in a Senate position and a seat they’ve held for, well one of them, for more than one election. Will you be embarrassed –
PRIME MINISTER: Sorry, you’re talking about –
KELLY: Jane Prentice.
PRIME MINISTER: Jane Prentice, no she’s been there for a while. Lucy Gichuhi came a cross form Family First so –
KELLY: That’s right, one of them has been in the seat for more than one election.
PRIME MINISTER: Yep.
KELLY: Are you embarrassed that you could be leading a Party that could have less than 20 women in it after the next election?
PRIME MINISTER: Well what I find interesting Fran is I haven’t seen much reporting on the preselection of Dr Fiona Kotvojs in Eden Monaro on the weekend, I mean she’s a great female candidate –
KELLY: It’s a pretty tight seat, she’s got to win it yet.
PRIME MINISTER: And that’s what we plan to do. That’s exactly what we plan to do and you’ve got Georgina Downer in Mayo, you’ve got Kate Ashmor in the seat of Macnamara, you’ve got Tanya Denison in the winnable slot in the Tasmanian Senate. You’ve got Claire Chandler, you’ve got –
KELLY: How many of those seats would you describe as winnable seats though? How many of those a re easily winnable seats?
PRIME MINISTER: The two Tasmanian Senate seats –
KELLY: Yeah, but in the House of Reps?
PRIME MINISTER: Oh, but just apart from those two you mean. [Laughter]
KELLY: No, no in the House of Reps. In the House of Reps, will we look at winnable –
PRIME MINISTER: Well we’ve got more selections to come Fran but what I’m saying is, I think it’s fair enough for people to say when a female candidate isn’t selected, but there doesn’t seem to be a lot of focus on when the Liberal Party does select a female candidate. So that’s what we’ve done and we’ll continue to do that. I look forward to more being selected but as always in the Liberal Party, we will always select what we believe is the best candidate for the job, like Dave Sharma in Wentworth. And I know people raise issues with quotas; well the only quota I think the Labor Party has excelled in, more than any, is having union officials fill the ranks of their parliamentary benches. They seem to have done pretty well on that score.
KELLY: Prime Minister, yesterday you came up with the idea of a new public holiday to celebrate Indigenous people and Indigenous heritage. Was this your idea? Where did this idea come from?
PRIME MINISTER: Well, can I stop you again? All I said Fran, was this – and I’m happy to have this debate, I think it’s a good discussion, I think Australians should have a chat – I simply said that I think it would be good, I was making the point that Australia Day is Australia Day and that will be the top national holiday of the year. Nothing else is set out to replace it or to provide an alternative to it. That is the national day where all Australians come together, First Australians, to our most recent. I then simply said this; that I’m happy to have a chat about how we can have greater recognition and honouring of our Indigenous peoples. And we should talk about that. Now, I haven’t said it’s a public holiday or not a public holiday, I haven’t –
KELLY: So you’re not talking about a public holiday?
PRIME MINISTER: I haven’t been so specific, I just think we should have a chat about it Fran. And I think we should and I haven’t got a problem with that, I’m not saying everyone has to agree with me. And if people disagree with me, that’s fine too. I’m not afraid to have this discussion, I think it’s a good discussion to have. We can’t turn our back on our history, but equally we don’t have to be in the mouth about it all the time either. I think we’ve got a lot to celebrate and I want to celebrate the achievements of Indigenous people in Australia, Indigenous and Torres Strait Islanders and in the ACT they have a day on the anniversary of the referendum in ’67. We have NAIDOC Week and a lot of people have said, yeah, we’ve got a lot of these. And so let’s just look at it and are we doing something which sufficiently acknowledges the great contribution and success of our Indigenous peoples? Some may say yes, some may so no. But I’ll tell you, one thing is for certain, Australia Day ain’t changing.
KELLY: Similarly, will you take a look at the Indigenous statement, the Uluru Statement From The Heart? It’s called for a constitutionally enshrined representative body for our First Nations people?
PRIME MINISTER: I don’t –
KELLY: That is a priority for a lot of Indigenous people.
PRIME MINISTER: I don’t support a third chamber –
KELLY: It’s not a third chamber they’re talking about necessarily.
PRIME MINISTER: No, no –
KELLY: It’s a representative body.
PRIME MINISTER: No it really is and –
KELLY: No, it’s not though.
PRIME MINISTER: People can dress it up any way they like but I think two chambers is enough and –
KELLY: But it’s not a chamber in Parliament that they’re referring to.
PRIME MINISTER: But the implications of how this works frankly lead to those same conclusions. I share the view that I don’t think that’s a workable proposal, but I also am passionate about the view – as I have been about reconciliation and about working together to ensure we can bring Australians together around these issues – but that doesn’t mean we have to agree on every proposal. But every proposal will be treated with respect and we will find the way forward.
KELLY: Prime Minister we’re almost out of time, but just on a story that’s in the news today. Are you concerned about the takeover proposal from a Hong Kong based infrastructure company of our biggest gas pipeline network? Some analysts think there could be a national security problem here?
PRIME MINISTER: Well, that issue will be dealt with carefully and the Treasurer oversees that role. As you know, under that legislation I used to have those responsibilities, that is actually a personal decision of the Treasurer under the legislation.
KELLY: I understand.
PRIME MINISTER: Not Cabinet. And There is a strong process that we actually put in place. At the time it was Attorney-General Brandis and I who set up the Critical Infrastructure Centre which looked at all the specific natures of the security aspects of all of our infrastructure around the country. Now the ACCC as you know has considered that issue and hasn’t found that there would be competition issues that would arise as a result of that application. But there’s still a process to go through and we’ll do that in a calm and measured way.
KELLY: Prime Minister thank you very much for joining us on Breakfast.
PRIME MINISTER: Thanks Fran it’s great to be here, cheers.