JOURNALIST: On the line, Finance and Deregulation Minister Penny Wong joins me. Penny, good to talk to you again.
WONG: Gday Steve.
JOURNALIST: Penny, the latest Newspoll published in The Australian newspaper shows on a two-party preferred basis, the Coalitions recorded Newspoll is its second highest vote of 58 per cent, and Labor, its lowest of 42 per cent. The carbon tax is going to wipe you out isnt it?
WONG: Theres always a lot of focus on polls, but to be honest as a Government were focused on getting this through, and getting out there and explaining to Australians what this package will do, and how it will reduce our pollution and help us move to a cleaner energy future really, thats what were focused on.
JOURNALIST: But if you want it to stick, that means bringing people with you. Theyre not coming with you.
WONG: We have a lot of work to do; the Prime Minister said that. We have a lot of work to do now that weve announced the detail on Sunday. To get out and explain it to people, to talk to people about the tax reform package thats part of this clean energy package. To talk to people about how it will affect them, and to talk to people about how we know our jobs will grow, our economy will grow, our incomes will continue to grow, even with a carbon price.
JOURNALIST: Do you think that people see it as fundamentally compromised? Already it was borne of a compromise, the Greens have claimed it as a massive compromise, so do the independents, so do many of your own ministers. Martin Ferguson, for example. And if the architects of this scheme regard this as materially compromised, can you see how the man in the street could regard it as exactly that?
WONG: Steve, what Id say is that I think this is a very good package. It is a package that has the support of the Parliament. Its a package that will actually get on and do what Australia has been talking about for the best part of a decade.
Lets remember that John Howard commissioned a report on climate change, on how to deal with it, in 2006. Thats where the view about an emissions trading scheme first was put on the table by him.
So weve been talking about it for a long time, and this is a package that I think is effective, that will ensure that we can continue to grow our economy and our jobs. But we can move to clean energy and clean technology, rather than going down an older path.
JOURNALIST: $150,000 seems to be the magic number for the Labor Government for all sorts of policies. Why did you pick that number?
WONG: We havent actually picked a particular number. What weve done is provided a tax cut for everyone in Australia earning up to $80,000. So thats a very substantial tax reform, its part of the package of tax cuts for everybody earning up to $80,000. What weve also done is increased various government payments such as the pension, such as family tax benefits, by about 1.7 per cent.
Bearing in mind that the overall price impact from the carbon price Treasury has modelled at less than 1 cent in every dollar. So, less than 1 per cent. What weve done is used the existing payment system, we will increase that, and well also give everyone earning up to $80,000 a tax cut.
JOURNALIST: But if youre single, and youre working, and youre on about $80,000, you virtually get negligible benefit from your proposal.
WONG: Steve, were upfront that not everybody ends up square or out in front from this package that is true. Weve had to make decisions about where to prioritise assistance, and we have prioritised people like pensioners, we have prioritised people who receive family tax benefits.
JOURNALIST: And why have you done that?
WONG: Because we do think you should provide assistance where we believe its needed most.
JOURNALIST: But why do they need it most, in your concept?
WONG: I dont think someone like me does need assistance. So I think what weve said is that 9 out of 10 households will receive some assistance, through tax cuts or payment increases.
Almost 6 million households will come out square or ahead. And weve been very clear about prioritising where that assistance is. Bearing in mind, there is a very substantial tax reform package as part of this. No one will pay more income tax, and everyone up to $80,000 will pay less tax.
JOURNALIST: The perception is particularly by Australian business is that theyre going to be hit by additional imposts, but our overseas manufacturing competitors, particularly in China and Korea, are not. Can you give us any assurances, for example, that we will have a car manufacturing industry in twenty years?
WONG: Can I just make a couple of points there. The first point is weve put in place a very substantial amount of assistance in this package to recognise some of the competitiveness issues for our export industries.
And theres a $9.2 billion jobs and competitiveness package, which is all about dealing with the issue of firms that export into world markets and have to face a carbon price. And weve worked through that very closely with industry.
In terms of the vehicles sector, the Government has a pre-existing commitment to that sector, nearly $5.5 billion in the car plan. So, theres a lot of assistance there. I think the broader point is this: what Treasury tells us and these are the people who advised John Howard and Peter Costello, as well as Julia Gillard and this Government is that we can continue to grow our economy, we can continue to grow our incomes, and we can continue to grow jobs out to 2020 with a carbon price.
JOURNALIST: Talking to a lot of people, particularly yesterday, a lot of our listeners, a lot of emails coming in. The big issues that seem to concern people are Australia moving ahead of the rest of the world, and Australia moving insufficiently even if its a material proposal that you put in place moving insufficiently to make any difference whatsoever. For example, Chinas carbon dioxide emissions represent around a 25 per cent share of the worlds emissions. They rose around 10.4 per cent in 2010 according to data from BP. The question people are asking is, what difference will Australias scheme make?
WONG: There are a number of parts to that question, Steve. The first is your point about China, and the suggestion that firstly theyre not doing anything, and second, therefore we shouldnt.
First, China is acting. Chinas per-person emissions are much lower than Australias, and China is investing a massive amount of money in renewable and clean energy. Theyve got the largest installed renewable capacity in the world, because they understand that this is the way of the future.
Bear in mind also that we in Australia are the highest per person emitters in the developed world. So we do need to start the shift to cleaner energy. Both parties agree we need to reduce our emissions. The difference is Tony Abbott has a policy that will tax Australians $720 a year for no environmental gain. We want to price carbon, we want to do that to ensure we move to a clean energy future, give the signal to investors and business about moving to that future, and will use the money we raise to give a tax cut and a payment, you and I have been discussing, back to Australian households.
JOURNALIST: I think people have got the picture of the tax. Im really just focusing on this China issue. The measure, the tool, the KPI that you keep referring to, is a per capita measure. But when you consider that China has got a population of 1.3 billion and Australia is merely 22 million. India has got 1.1 billion any per capita measure is going to favour those big countries. What Im really focused on is total emission output and on that basis, a 25 per cent share, they continue to grow.
WONG: The proposition that I think underlies your question Steve is that somehow we shouldnt bother. That everyone else should do something about climate change. If you think climate change is real and you think we need to do something about it, then the question is what do we need to do about it?
If were saying we shouldnt do anything because other people are also emitting, were essentially saying look, its not our problem. I think this is a global problem. Its a problem that the whole world does have to act on.
Its not true to say other countries arent acting they are. This is about Australia doing its share. Its also about us being able to compete. If you look to the future and you work out where the global economy is going and you look at where there is growth, youd have to say, we need to be able to compete in the clean energy and the clean technologies that increasingly this world will pay a premium for. If we want to do that, we have to start shifting where our economy is heading.
JOURNALIST: One of the criticisms of a carbon tax as a mechanism, as opposed to other mechanisms, is that it centralises the revenue stream back to government, and then government determines how it is going to hand it out. Why should people have confidence in that mechanism, that is, inflow of funds to a government, and then outflow is determined at a discretion of government in light of for example, pink batts, the school halls and other like schemes that have been implemented by your Government and your predecessor government.
WONG: Well lets make the point. We are taking revenue from the big polluters and we are choosing to redistribute it across the economy to households and to business, to support jobs and to help people meet any price impacts. And the detail of that is that tax cuts that weve made a commitment to and the detail is out there. The detail of that includes the increases to payments that people will get, and all of that detail is out there. And the detail includes the assistance to industry.
JOURNALIST: Which will be $10 billion. How can we have confidence that the Government, albeit with an independent panel will be successful in choosing winners to the tune of $10 billion with our money in an area thats emerging technologies?
WONG: Can I just make the point I just wanted to make this point about governments choosing winners. Theres actually very little of that in what were proposing. Theres a whole lot of that in what Tony Abbotts proposing.
Tony Abbotts policy is at its heart increasing payments from households, getting government to decide where those payments should be directed. And giving some of that money to a bunch of big polluters. So if youre worried about picking winners, then you wouldnt be supporting the policy that Tony Abbott is putting forward to the Australian people.
JOURNALIST: Can I quickly turn to Penny, appreciate your time. Can I quickly turn to the question of protectionism in Australia. A big debate at the moment and Kevin Rudd is right in the middle of it. Is the extent to which we should call for tighter controls on foreign investment in Australia do you think we should have tighter controls on foreign investment in Australia?
WONG: I think this is an issue where theres a lot of discussion in the community about this and theres also some concern some of that based on fact and some of it based on things which arent quite accurate.
I think its important to remember that investment, foreign investment in Australia supports Australian jobs, and that we have been a net importer of capital. We have had people investing in this country for a very long time now, and thats been a very important part of keeping our economy strong. Of course you have to look at national interest issues, thats why we have systems in place to assess the national interest implications of various investments. Thats proper, thats as it should be. But remember, investment does equal Australian jobs.
JOURNALIST: Tony Abbott has called for a debate with the Prime Minister over the proposed carbon tax. Should that happen?
WONG: I think theres a lot of debate going on at the moment and its obviously up to the Prime Minister how she wants to respond to that. But I think shes been very clear, shes upfront, shes out there talking to people like yourself and to the Australian people about this package, and weve got our policy out there in detail.
What we do know from Tony Abbott is that hes not got a policy out there thats going to work, hes not got a policy out there thats properly funded and hes also telling Australians that hes going to be opposing the tax cuts that weve been discussing.
JOURNALIST: Penny Wong, always good to talk to you.
WONG: Good to speak with you Steve.
ENDS