SUBJECTS: Carbon tax
David Bevan: In a few days time the carbon tax is going to be introduced. Yesterday we spoke to fridge mechanics working in South Australia who said the price of the gases they use are going up perhaps by a factor of 400 per cent. They say they’re not arguing with the policy goals of the carbon tax. They’re not denying there’s compensation for households. They’re not denying that large businesses have the cash flow to manage this. What they’re saying is under these price increases small to medium businesses will be screwed.
Penny Wong: I don’t have the full details of the refrigerant gas issue in front of me because I know there was some misinformation out there and I know Greg Combet put out some public information about what is actually occurring. You might recall refrigerant gases have been regulated for a long time, including under the Howard Government because of their environmental problems. I can give further information back to you on this, but can I just say
Mathew Abraham: (inaudible) 400 per cent.
Wong: I’m not sure I accept that, but what I would say is in acknowledging your question there is a significant household assistance package. The price impact across what we call the consumer price index of the carbon price is about 0.7 per cent. That is substantially less than the GST impact. So, what I would say to people is this does start on Sunday and I suspect that some of the sky is falling in comments by Mr Abbott including Whyalla would be wiped off the face of the map might be shown to be less than accurate.
Bevan: If there is a small business person listening right now who believes they are going to be caught out in a serious cash flow problem where do they go?
Wong: Well, can I make a couple of comments about that. The first is small business is not paying the carbon price. They’re not directly paying it. That doesn’t mean there isn’t a price impact because of course when large polluters pay the carbon price that can be passed through. We’ve assumed small business in Australia will pass on some of that price increase to consumers, which is why we’re providing a tax break; lifting the tax free threshold and giving everyone earning up to $80,000 a tax cut, plus increases to payments such as pensions and so forth. Also on small business we’ve got a couple of measures in the budget that have been handed down that does assist small business in terms of their tax position. So there’s some tax breaks there and I’d say it isn’t like the GST where people have to file a business activity statement regularly and pay tax to the government. They aren’t actually paying it directly.
Abraham: Chris Pyne, is the Opposition, is it fair to say that the Opposition is running scare campaign on this – that the sky won’t fall in on come Sunday night?
Pyne: Well let me give you one example. Last week we asked the Treasurer Wayne Swan to respond to the Victorian Automobile Chamber of Commerce which had said that refrigerant gas would increase by $30 from $ 22 to $52 which confirms the point that your fridge mechanics made when you spoke to them – he said that that was a dodgy claim and that your shouldn’t believe it. Yesterday as we pointed out to the Treasurer in Question Time that the Governments own Carbon Tax calculator indicates that refrigerant gas will rise by $30 and he said it was part of our fear campaign. Now it’s the Governments own CT calculator, now whenever they are presented with any facts whether it’s about refrigerant gas whether it’s about electricity price rises they don’t respond to the question they simply say its part of a fear campaign because basically they haven’t got anything else to say. The general public know that of course they’ll all be paying the CT in the form of higher electricity prices from July 1 and of course there will be a significant impact on the cost of living and with people not being able to pay household bills now and the confidence being as low as it is across the economy it is the worst possible time to be introducing a new tax.
Abraham: And its going to become so enmeshed in the system that you’re not going to be able to unwind it are ?
Pyne: No not at all. No parliament can stop a future parliament from legislating so the simple truth is that if something can be introduced it can be removed. And an Abbott government will have no difficulty removing a CT if we are fortunate enough to be elected and suggesting we can’t is just complete nonsense and just part of the government yet again trying to muddy the waters with facts that aren’t facts because they can’t really answered the questions that you put to them this morning that you put to Penny that about 400 per cent increase in refrigerant gas is ditching it back to the talking points and talked about fear campaigns because they can’t genuinely answer the question.
Wong: Is my microphone now working….good I no longer have to snuggle up … that’s much better for both of us … I think if there has been any talking points guys I think you know who’s been repeating the same mantra over and over again. It was the great big new tax on everything and now its…(inaudible), … about talking points you’re the Master of that Christopher now we see the Coalition moving from a Cobra strike to a Python squeeze ..
Pyne: Yes a Python squeeze thank you for repeating it.
Wong: I think Australians probably deserve a little more than these sorts of (inaudible).
Abraham: Well, both sides, I think we’ve seen this in Federal parliament, we’ve seen it reduced to just sound bites and grabs and slogans have we not Penny Wong? The words pot kettle and black..
Wong: I try not to use that particular phrase. I think that I suggest to you, on your programme particularly I do try and respond in a way that isn’t just about sound bites.
Abraham: I was talking broadly this morning about this Government and the Opposition.
Wong: Let’s move on.
Pyne: We have been asking about refrigerator and gas for two weeks in Parliament, and Penny’s response was this morning she had to go away and ask Greg Combet what the answer was. I mean the fact that the Minister for finance has missed those questions is rather dramatic.
Wong: Well, I don’t know if you didn’t notice I am in the Senate.
Pyne: So you don’t read the newspapers?
Wong: Christopher, really.
Pyne: Well really, seriously.
Abraham: Hang on, Christopher Pyne.
Pyne: It’s a specific question.
Abraham: Well you’re not asking the questions Christopher Pyne, you are supposed to be answering them.
Wong: I’ll just say this; I think I got every question in the Senate yesterday on carbon, refrigerator and gas wasn’t one of them.
Wong: And, I’ve had most questions in the last week and a half in the Senate, and that wasn’t one of them.
Abraham: Chris Pyne, just finally if you say that the Opposition won’t have any problem at all in unwinding back, or getting rid of the carbon tax, will you concede that you will have a problem in taking away the compensation that has been there for people, because they will be used to getting that.
Pyne: Well we have said that we support the increase in the pension, the only measure that we opposed in the last month was the school kid’s bonus, because it is not an education payment, it’s simply carbon tax compensation.
Wong: Not, you’re opposing the tax cuts.
Abraham: But the carbon tax is paying for all those tax cuts and if you remove the carbon tax, you can’t continue the tax cuts.
Pyne: Well when you remove the carbon tax, there will be an immediate impact on the economy because of course aluminium, alumina, steel, manufacturing etc won’t face the prospects of losing jobs and higher prices because of the massive increase in electricity prices.
Wong: Can I tell you the true position that Joe Hockey has made very clear, and that is the coalition have committed to increasing taxes for everyone earning under $80,000 a year.
Pyne: For goodness sake.
Wong: We are tripling the tax free threshold that gives everyone earning up to 80 grand a tax cut. It is very good particularly for second income earners, it’s good for participation, because you spend more of every dollar you earn. The Coalition has made it clear they will reverse, should they win government the tripling of the tax free threshold. That would mean that everyone earning under $80,000 would lose that tax cut and pay more tax.
Abraham: Senator Wong, we also have requested to talk to Greg Combet on Monday, on the first working day of the tax, we haven’t heard back from his office, so I am sure you might have a word to (inaudible)
Wong: Do you broadcast from Whyalla?
Pyne: The thing about the Whyalla was that the Australian Metal Workers Union man said that Whyalla would be wiped off the map, not Tony Abbott; it’s just another one of the lies being put around by the Labor Party.
Abraham: Christopher Pyne, thank you liberal MP for Sturt.
Abaraham: And Penny Wong, Labor Senator for South Australia and Minister for Finance, thank you for talking to us.