ABC 891

E&OE TRANSCRIPT
Interview – ABC 891 Adelaide with Matthew Abraham, David Bevan and Mark Butler
Wednesday 18 February 2015

SUBJECTS: Taxation; Nuclear energy.

COMPERE: Joining us in our studio right now is the Education Minister, Liberal MP for Sturt, Leader of the House, Christopher Pyne. Welcome to the studio, Christopher Pyne.

CHRISTOPHER PYNE: Good morning, gentlemen.

COMPERE: And Mark Butler, Labor MP for Port Adelaide, Opposition Environment and Climate Change spokesman, welcome to you, also.

MARK BUTLER: Thank you, good morning.

COMPERE: Good morning. Chris Pyne, we have got a text here, from Julia.

CHRISTOPHER PYNE: Sounds dangerous.

COMPERE: Julia from Brighton.

CHRISTOPHER PYNE: Don’t tell me it’s going to be praising me.

COMPERE: No silence, okay.

CHRISTOPHER PYNE: Silence is the only weapon the interviewee has.

COMPERE: This is for Mr Pyne. Kiss kiss kiss kiss kiss kiss kiss kiss kiss hug hug hug hug hug hug hug hug kiss kiss kiss kiss kiss kiss kiss kiss.

CHRISTOPHER PYNE: That is what we want to see.

COMPERE: Is that okay?

CHRISTOPHER PYNE: That is exactly the kind of texts I am expecting from the listeners.

COMPERE: I’ve got a funny feeling it is your wife’s number there.

COMPERE: Just the sort of debate the country needs. More hugging and kissing.

CHRISTOPHER PYNE: My mother certainly wouldn’t send me a text like that, she would more likely to tell me off for not ringing her.

COMPERE: Now can we establish with both of you, right at the start, the family home – it’s off limits, is it, in terms of asset tests, taxes, you know, in terms of taxes other than…

CHRISTOPHER PYNE: The only political party in recent political history that proposed the family home be part of the assets test was Labor in 1984. Liberals have never proposed it, and never will.

COMPERE: Mark Butler?

MARK BUTLER: Recently? 1984? More than 30 years ago?

CHRISTOPHER PYNE: Well, certainly in my lifetime.

MARK BUTLER: I haven’t read that history book. The Americans have this great saying about the third rail of politics. Politicians touch it, they die politically. The family home is the third rail of Australian politics. There is no way in which Australia, the Australian Labor Party would consider a means testing the family home in the aged pension. The difficulty is on the front of Financial Review yesterday there was a suggestion that the Government was considering it, even the Parliamentary Secretary to the Treasurer, Kelly O’Dwyer, was quoted as saying it was almost certainly going to have to be debated after the release of the intergenerational report which is due to be released in coming weeks. So that to say the least set the hairs running I think and scared a very significant number of pensioners who used their family home, their outright ownership of the family home, to hedge what is a very modest aged pension here in Australia.

COMPERE: Jay Weatherill is considering taxing the family home. Average of $1200 on a $400,000 home annually. Has he touched the third rail?

MARK BUTLER: Well no that is a very different question to asset testing it for the aged pension….

COMPERE: But you said it is a golden rule in politics, don’t touch the home, well he wants to touch it, well he is considering touching the home, $1200 a year on average.

MARK BUTLER: Well let me be very clear, I was talking about means testing the family home in a way in which the aged pension that you receive is actually been reduced because you happened to have a significant asset. And asset which doesn’t help you pay the grocery bills, doesn’t help you pay your electricity bill or your phone bill. Now what as I understand it the state government here is doing is starting a debate about whether there should be a general land tax instead of stamp duties…

COMPERE: Which would affect the family home…

MARK BUTLER: It would affect all homes. And that is as I understand it a debate that the South Australian Government has started here. The ACT Government has responded to a range of pieces of advices…

COMPERE: Do you believe that Jay is touching the third rail?

MARK BUTLER: Well I think they’re very different questions … it remains to be seen …

COMPERE: …A home is a home is a home.

MARK BUTLER: No, no, it remains to be seen … what I’ve talked about is the question of asset testing the family home in a way that would reduce government payments, particularly the aged pension …

COMPERE: He wants to …

MARK BUTLER: So they’re apples and oranges …

COMPERE: No, they’re not …

MARK BUTLER: They are apples and oranges and what’s happened is the Government’s started …

COMPERE: No, no, it’s the same building and he’s looking at it and saying ‘it’s worth $400,000 and I will perhaps tax you $1200 annually on that,’ how is this different …

MARK BUTLER: That’s a ridiculous comparison to make, David … I mean, what I’m talking about is means testing the home in a way in which would reduce government payments like the aged pension …

COMPERE: Well he wants to means – he wants to means …

MARK BUTLER: No … the problem with what you’re saying is that …

COMPERE: He wants to means test the family home so that he can tax you.

MARK BUTLER: But the extension of what you’re saying is that there wouldn’t be council rates paid, there wouldn’t be any taxes paid on the family home, of course that’s not what I was saying. What I was saying is it is the third rail of Australian politics to means test the family home for payments like the aged pension … the government appears to have raised the possibility …

COMPERE: And you’re not gonna do that?

MARK BUTLER: Oh, we won’t agree to it, we simply will not agree to it. Now the Parliamentary Secretary to the Treasurer and the Minister for Social Services floated a balloon yesterday on the front page of the Financial Review …

COMPERE: Well there’s no evidence he floated that balloon though because he then went around and shot the balloon down about half an hour later …

MARK BUTLER: Well I suspect that instruction came through very clear … the Parliamentary Secretary to the Treasurer was quoted as saying that almost certainly would be a matter debated in the next few weeks.

COMPERE: Chris Pyne, is it now not going to be debated?

CHRISTOPHER PYNE: Well, the AFR made up a story and got shut down, simple as that. I don’t know who wrote this story, I didn’t bother to look at it …

COMPERE: Did Peta Credlin ring them up?

CHRISTOPHER PYNE: …It was a complete made up story by the Financial Review and the Minister went straight out and slapped it down quite rightly so … of course Labor leapt on it hoping that they could have a debate about the family home … this is the tenor of politics these days in Australia … a journalist can make up a story and then a Minister – when they deny it, it still continues as a story … half the problem with the press gallery in Canberra …

COMPERE: Do you have a problem with the press gallery?

CHRISTOPHER PYNE: I said it’s half the problem.

COMPERE: What’s the other half?

CHRISTOPHER PYNE: That they’re there …

MARK BUTLER: Shooting the messenger again.

CHRISTOPHER PYNE: …The AFR made up a story and they should be writing a clarification today …

COMPERE: Can we just clarify – have you got a problem with half the gallery or have you got a problem with all of the gallery and half of that problem is that they make up stuff and the other half of the problem you haven’t told us?

CHRISTOPHER PYNE: No, the latter is the situation.

COMPERE: Oh, you’ve got a problem with all of them …

CHRISTOPHER PYNE: And half the problem is that they make up stuff – the other half are personality defects.

COMPERE: Are they a dysfunctional lot …

COMPERE: Mark Butler, what do you think about that?

CHRISTOPHER PYNE: No, they’re wonderful people, I’ve known them for decades.

COMPERE: Chris Pyne…

CHRISTOPHER PYNE: …you make me have fun in the studio…

COMPERE: It’s alright, we know how quiet you were when David was asking those questions of Mark Butler.

CHRISTOPHER PYNE: They were good questions.

COMPERE: Chris Pyne, the family home though … it’s seen as the big pot of gold and … there’s this almost simplistic argument – or is it a simplistic argument that … at least people should be able to sell the family home and somehow live off … downscale somehow and live off the proceeds, and in many cases that’s just not practical that this mythical pot of gold when people attempt to do that isn’t there. Do you see that or do you think … somehow you should be able to free that money up and the debate now is that – and then that wouldn’t affect your pension?

CHRISTOPHER PYNE: I do think the rules around the pension tests are such that they do lead to, I suppose, distortions of the market … in my electorate which is the eastern and north-eastern suburbs there are many older people in very large homes who are frightened to sell them and … and live, try and keep those houses, the gardens and so on, pay the electricity bills and the water bills …

COMPERE: Why are they frightened to sell them?

CHRISTOPHER PYNE: Because they’re worried that the extra income that they then earn will mean that they lose their pension … to some extent that’s distorting the market.

COMPERE: And Mark Butler, you’re nodding in agreement here … you don’t have such a leafy electorate, correct?

MARK BUTLER: Well, I was the Minister for Ageing for some years in the last Government and the Minister for Housing …

CHRISTOPHER PYNE: I was Minister for Ageing too.

MARK BUTLER: For a much shorter time, Christopher. I designed a pilot which we announced in the 2013 Budget to allow older Australians to sell a large house, buy a smaller house and park the profit – I used the term profit - in a way in which they wouldn’t have their pension reduced … that was a pilot to examine whether this was in fact …

CHRISTOPHER PYNE: It’s a bit complex …

MARK BUTLER: Well … one of the early decisions of the Abbott Government was to kill the pilot off altogether, so we haven’t been able to assess it and see whether there is this issue in the housing market that people have talked to governments of both political persuasions about for some years … that’s a pity …

COMPERE: Why kill that off, Christopher Pyne because you’re now talking about it being a good idea …

CHRISTOPHER PYNE: It was a [unclear] …

COMPERE: Well at least it was something …

CHRISTOPHER PYNE: No, it wasn’t really. It was a very, very complicated, bureaucratic, red tape laden scheme where …

COMPERE: Did you like the idea …

CHRISTOPHER PYNE: …had a certain amount of money you could put into it and then you couldn’t put in anything after $200,000 …

COMPERE: But you liked the principle?

CHRISTOPHER PYNE: The principle I think needs to be considered because … it is distorting the market … there are families – two, three, four kid families who might like to live in some of those larger houses where there is an older person, man or woman, hanging onto the house because they’re worried they’re going to lose their pension if they sell it and I think that is a distortion of the market, so Scott Morrison did say yesterday that that’s something we should be thinking about.

COMPERE: Well we have lots of calls on this. Let’s go to calls at almost fifteen minutes to nine. Christopher from Black Forest. Good morning.

Caller Christopher: Good morning Dave. I’ve got a question to Mr Butler, is he saying he’s in favour of Premier Weatherill’s proposal to impose land tax on the family home?

MARK BUTLER: Thanks for your call, and Christopher is very happy I got a call this week unlike last week. I’m not saying that at all. I’m saying that Premier Weatherill has started a debate. I don’t have a view about it. I’m interested to watch that debate rollout and ultimately it’s a matter for the State Government.

COMPERE: But there are some things that you will rule out in some debates. Jay Weatherill has not ruled out this in this debate …

MARK BUTLER: The raising of state taxes, the decision of a state government – Liberal or Labor – about whether they focus on stamp duties as a way in which to raise tax or general land tax, this is a matter for them and I think it’s good that he’s put that matter out for debate in the South Australian community. Now …

COMPERE: It’s good that we can …

MARK BUTLER: …asset testing in the family home for the aged pension is a Commonwealth matter for which we have responsibility – people like Christopher and I …

COMPERE: You think it’s good that we consider taxing the family home?

MARK BUTLER: Well the family home is taxed … by council rates and in a range of ways … it’s a question of how you tax it … Jay has put out a proposal to debate whether you focus on stamp duties at the point of sale and purchase or whether you focus on a general land tax. I don’t have a view about that. I’m looking forward to that debate rolling out but ultimately it’s a matter for Jay, it’s not a matter for Christopher and it’s not a matter for me.

CHRISTOPHER PYNE: I don’t remember Jay Weatherill talking less than a year ago before the State Election about putting a land tax on the family home and I don’t remember him talking about nuclear energy and nuclear waste dumps for South Australia before the last State Election either … there seems to be a late conversion to raising new issues.

COMPERE: Do you support a nuclear waste dump in South Australia?

CHRISTOPHER PYNE: No, I don’t …

COMPERE: You don’t?

CHRISTOPHER PYNE: No, but there’s no proposals for a nuclear waste dump in South Australia.

COMPERE: Nick Minchin wanted to put one here …

CHRISTOPHER PYNE: No … he and I have exactly the same view which was that a nuclear waste dump needed to be sited somewhere in Australia, there was a proposal for it to be at Woomera; it didn’t go ahead and I don’t support a nuclear waste dump in South Australia.

COMPERE: And you support a nuclear enrichment industry for South Australia?

CHRISTOPHER PYNE: Nope.

COMPERE: You must be really worried about the polling in your electorate.

CHRISTOPHER PYNE: Nope. But Mr Weatherill wants to open a debate on nuclear energy and nuclear waste, he can answer the questions about it, I’ve been through that debate once. I remember what it was like when the Labor Party tried to coax the Federal Liberal Government into a nuclear waste discussion and then as soon as they did so decided to turn their backs on the Liberal Party and make a campaign through The Advertiser against it … Mike Rann was the Premier, I remember it extremely well.

COMPERE: Is that the fear here … you’re not going to sucker punch us twice on this issue?

CHRISTOPHER PYNE: I think we have all the energy we need here in Australia and we’re doing extremely well, whether it’s coal energy or whether it’s wind energy, solar energy, etc … I don’t support an extension to nuclear energy.

COMPERE: Mark Butler, do you?

MARK BUTLER: I think we talked about this last week … I don’t think that nuclear energy is a practical option for Australia and won’t be for the next two decades, that’s the advice that I’ve received from experts around the country … I think Jay’s conceded that may well be the outcome of the Royal Commission … Federal Labor has … a policy against any further involvement in the nuclear fuel cycle other than mining and that includes enrichment …

COMPERE: Jay Weatherill was not interested in your leader’s policy on that …

CHRISTOPHER PYNE: He didn’t raise this before the State Election either, Jay Weatherill …

COMPERE: Chris Pyne, Tom Koutsantonis the Energy Minister has sent a text saying, “The Feds have a tender out now for a national nuclear waste depository.”

CHRISTOPHER PYNE: Somebody has to apply for the tender.

COMPERE: You don’t support it?

CHRISTOPHER PYNE: Somebody has to apply – I’m not applying for the tender … I am not tendering to have a nuclear waste dump in South Australia.

COMPERE: No, and you don’t want the State Government to tender for it because you don’t want one in South Australia?

CHRISTOPHER PYNE: That’s a matter for the State Government …

COMPERE: Yeah, yeah but personally, you’re a South Australian …

CHRISTOPHER PYNE: personally I don’t see the need for one here in South Australia, no.

COMPERE: Okay …

CHRISTOPHER PYNE: I think there are other options which are just as valid … if the South Australian Government decides to tender for a nuclear waste dump in South Australia, I’ll be fascinated if they get to that point given the campaign they waged against such a dump under the Rann Government.

COMPERE: Jason has called. Hello Jason … your question?

Caller Jason: … My question was for Christopher Pyne. You were talking about your home … as an asset … I wanted you to expand on that … is it … a definition of an asset and that for the asset of a home requires an income so therefore when someone at home like myself or generally pensioners who own a home, who reside in their property who do not derive an income from their home, how can you classify that as an asset …

COMPERE: Alright, so if it doesn’t earn income for you, Jason …

CHRISTOPHER PYNE: Well … Jason, I am not proposing and neither is the Federal Government that … the family home be included in an assets test … an asset does not have to earn an income to be defined as an asset. You can have an asset that is losing value if you wish to hold onto it.

COMPERE: You can use your family home though can’t you to leverage loans …

CHRISTOPHER PYNE: Sure …

COMPERE: To buy shares and so on …

CHRISTOPHER PYNE: Of course you can …

COMPERE: Hello David …

Caller David: … Why is it that you think that somebody who chooses to live in say a property worth $2 million or $3 million and therefore chooses not to downsize, should be cross subsidised by other taxpayers? So why can’t we say … I don’t want to kick anybody out of their house but say everything that’s over … $1.5 million or a figure for you guys to work out, that figure then gets added to the asset test?

MARK BUTLER: … two issues … I think it’s been a very deeply and broadly held view that if you work hard and pay off your home over the course of a long working life that you should be entitled to enjoy the benefits of that through your retirement … there’s a lot of merit to that view … the aged pension in Australia is a relatively modest one. By any international standards we have one of the lower aged pensions and pensioners … by no means have an easy road in terms of paying their weekly and fortnightly bills … at the end of the day a house …

COMPERE: The pension is not very generous though is it?

MARK BUTLER: A house whether it’s half a million dollars or $2 million in Sydney – as many assets are – does not help you pay the weekly grocery bills and the weekly electricity or [unclear] the electricity bills … it’s a very different …

COMPERE: Exactly and if we’re talking about people who are struggling to pay those bills … a large number of pensioners would be struggling to pay those bills, so they would look across to another suburb and see a pensioner in a home that’s worth $3 million and think ‘well, hang on if that pension was means tested and the money that was achieved back to the taxpayer through means testing was divvied up, the rest of us would be able to buy our groceries.’

MARK BUTLER: But what you’re doing is either requiring people to sell their $3 million home or you’re saying that you’re going to get a cut in your income just because you happen to own a significant asset …

COMPERE: Well hang on, there is another way … there was a fellow on the news last night who was saying ‘look, effectively what this is all doing is protecting inheritance for the next generation … why don’t you allow the person in the $3 million home to stay there but they’re required to take out a reverse mortgage?

CHRISTOPHER PYNE: Well, people can take out a reverse mortgage now.

COMPERE: But instead of giving them a pension or they get … a pension …

CHRISTOPHER PYNE: It’s about choice, David, you see …

COMPERE: But you two are saying … you either sell the house or you don’t sell it … there are some more sophisticated options and David from Magill thinks that you ought to be thinking about that.

CHRISTOPHER PYNE: Well and fair enough it’s a democracy and David’s entitled to his view … hopefully he’s a Liberal voter if he’s living in Magill … the truth is … there aren’t many pensioners living in $3m houses, so let’s not take a really extreme example and then try and make that the law in Australia … in Australia we don’t envy other peoples success, we don’t take away people’s houses and distribute their income … they pay their taxes, everyone pays their taxes whether it’s GST or income tax or stamp duty or whatever else … that’s the contribution they’re making to our society to build, pay for our defence force and build our roads, etc. We then don’t say later in life ‘actually you know we’re going to run a Marxist economy instead and if you’ve done very well we’re going to take your house away and pay the groceries with it for other people,’ - that’s not the kind of society we want in Australia …

COMPERE: We do do it with superannuation … people put money away into super … governments progressively can’t keep their hands off it …

CHRISTOPHER PYNE: No, there’s a big concession for people who put their money into superannuation because both Labor and Liberal I believe… think that the more people who are looking after themselves in terms of their income, later in life, the much lower the pension burden will be …

COMPERE: So no more taxes, no more changes to the super system in terms of the taxes on that, is that …

CHRISTOPHER PYNE: Well the Coalition’s not proposing any changes …

COMPERE: And the same to Labor, is that correct?

CHRISTOPHER PYNE: The Labor Party is …

MARK BUTLER: Oh wow, well Chris Bowen has said – the only thing that we’ve raised is we oppose the decision of the Abbott Government to remove the tax concession from very low income earners, the 3.5 million or so people who earn under 35,000 and get no concession on their superannuation tax and what the Abbott Government did instead was to give a tax break to the very high income earners …

CHRISTOPHER PYNE: That’s not what happened at all …

MARK BUTLER: That’s exactly what happened, exactly what happened …

CHRISTOPHER PYNE: When Labor came into power we were giving people a dollar for dollar contribution for their superannuation on low incomes; Labor scrapped that and introduced something else …

COMPERE: Okay I have to say – oh by the way I’ve asked Tom Koutsantonis in reply to his text, “Well are you going to tender for this nuclear waste dump then?” And he said, “We can’t pre-empt any Royal Commission findings”.

CHRISTOPHER PYNE: Weasel words from Tom Koutsantonis, how surprising …

COMPERE: Well anyway I’m just saying, “Another point the Feds have offered full cooperation to the Royal Commission seems at odds with what Pyne is saying.” But anyway, I think you’ve all had a good crack and I have to say our text community today has been a credit to 891. I think we have all learnt the lesson.

CHRISTOPHER PYNE: They have been perfectly behaved.

COMPERE: Chris Pyne, thank you.

CHRISTOPHER PYNE: As have we been perfectly behaved.

COMPERE: I know, almost too much so. Chris Pyne, thank you.

CHRISTOPHER PYNE: Pleasure.

COMPERE: Liberal MP for Sturt, Education Minister. Mark Butler, Labor MP for Port Adelaide, Environment Spokesman for the Opposition, thank you.

MARK BUTLER: My pleasure.

[ends]

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