FRIDAY, 20 MAY 2016

CHRIS BOWEN, SHADOW TREASURER: I'm very pleased to be joined today by the Shadow Minister for Finance Tony Burke to respond to the pre-election economic forecast. This independent analysis by the secretaries of Treasury and Finance underpins and underlines three years of economic policy failure in the Abbott-Turnbull Government. The Abbott-Turnbull Government said they would fix debt and deficit. We know, these figures confirm what we knew on Budget night. That the Budget deficit is up, debt is up, spending is up, compared to the last pre-election economic forecast. So much for fixing debt and deficit. Tony Abbott and Malcolm Turnbull have made it so much worse. We know what we knew on Budget night, that this year's Budget deficit has tripled, [inaudible] projected to be just in 2014. We know that debt is $100 billion higher over the life of this government. This is the debt and deficit record of the Liberals. 

But also, this pre-election economic forecast tells us more. It tells us that the record of the Abbott-Turnbull government on jobs and growth is not what they'd like you to believe. Here you have the secretary's warning that if non-mining investment continues to bump along as it has under this Government, then GDP growth will be hit. So much for jobs and growth. Here you have the secretary's warning about the AAA credit rating, as we have been doing, as I did at the National Press Club a week ago, warning that under this Government's watch, we need to be very careful about the AAA credit rating. Very interestingly, the secretary's outline on page 8, that they believe that Australia has a revenue problem. My words, but their sentiment, saying Australia will need to lift revenue if we are ever to get back to budget balance. What the Labor Party has been saying now for years in writing from the secretaries of Treasury and Finance. And all this is based, all these forecasts and result s, are based on presumptions and forecasts which, as I said at the National Press Club last week, are, in our opinion, highly optimistic at best. One particular measure before I hand over to the Shadow Finance Minister to talk about some particulars in this update. It's clear for the first time in this document that the Government runs the grave risk of not being able to deliver the tax cuts, personal income tax cuts on July 1. The document says on page 40 that these tax cuts may not be delivered. Now, on Budget night, on behalf of the Labor Party, I made our position clear that we will support these tax cuts for people over $80,000. But the Government clearly had not done its homework. The dysfunction of having a budget brought down and then three weeks later, less than three weeks later, the secretaries of the departments reporting that a key measure might not be delivered says it all. This was a Budget that was rushed. This is a Budget which veered from thought bubble to thought bubble. No wonder the bureaucracy has had trouble keeping up with this Government. They have gone from personal income tax increases, to GST, to dealing with super, not dealing with super, dealing with excesses in negative gearing to not. Now we know the Government had not done the due diligence, not done the key work, to ensure that a personal income tax could be delivered on 1 July as promised, just three weeks after the Budget has been delivered. This is the latest in a long line of measures in this Budget which has fallen apart. We had the corporate tax cut, which the Government put into the witness protection program, wouldn't tell us how much it cost. It was the centrepiece of their Budget. We have had the youth unemployment measures being very critically questioned. We have had the forecasts which are heroic in many instances, and now we have personal income tax cuts which won't even be delivered according to the Taxation Commissioner, that there a re severe risks they won't be delivered as outlined in the pre-election economic forecast, and it goes on to talk about some of the other indicators in dysfunction in this budget, I'll hand over to Tony and then we'll take your questions.

TONY BURKE, SHADOW FINANCE MINISTER AND MANAGER OF OPPOSITION BUSINESS: Thanks very much. The document released today confirms that we now have, from the last PEFO to now, an additional $100 billion of net debt. The document confirms that from this Government's first Budget to the end of their term, they tripled the deficit for the next financial year. What the document's not able to confirm, though, is the information the Government has withheld from the secretary of Treasury and the secretary of Finance. Scott Morrison and Matthias Cormann have signed a formal statement claiming they have provided anything that could have material fiscal or economic implications, that they provided that information to the secretaries of their department in preparing this document. Yet, they clearly haven't provided the information on the changes they have made since Budget night on pathology or on the backpacker tax. You have got Barnaby Joyce running around the country claiming the Government has put the tax off for six months, but the Treasurer and the Finance Minister have refused to tell the secretaries of their own departments that's a new position. You've got a Government that is running one argument in the bush and a different argument in Canberra. You have ministers who, when they are in front of cameras, will claim that taxes have been deferred or have gone or that tax breaks are on their way, but when it comes to the administration of their own departments, the work has not been done. The information that we have, the secretary of Treasury and the secretary of Finance, have done their work independently by all accounts as best they could and have provided a level of commentary that was absent on Budget night. Particularly on what it means for the revenue problem, which we know from Moody's is directly related to our AAA credit rating. But we have specific measures that Government ministers have made clear that are up for change that th ey have not in fact done any of the work in advising their own departments.

BOWEN: Thanks Tony. Over to you, folks.  

REPORTER: Do you regard the Budget and therefore PEFO as being optimistic in its forecasts in some respects, therefore, if you are elected and you have made a promise of an October update won't the deficit therefore be higher?

BOWEN: Well, I have outlined that we will bring out an economic update, an economic statement by way of bringing forward my PEFO. That's even more important after today. This PEFO is a longer period in front of a Federal Election than any in history. That's the virtue of Malcolm Turnbull's decision to inflict upon the Australian people a very long election campaign, because he's decided obviously a long election campaign is necessary for the Australian people to fully appreciate his brilliance. The fact of the matter is we are now still, a considerable amount of time away from the election and it will make it even more important that I bring down with Tony as the incoming Treasurer and incoming Finance Minister, my PEFO and an economic statement within three months of the Government being sworn in. And that will update the figures. Now, it's only three weeks since the budget was being brought down and even in that three weeks we have seen considerable doubt. I outlined our concerns at the National Press Club. We have seen iron ore prices fall, we’ve seen wages growth the lowest on record, and a lot of the return to budget balance is pinned on high wages growth. That's not what we’re seeing. So when we bring out the midyear economic statement, it will be an important chance to allow the Government's economic policies, the incoming Government's economic policies to be reflected in the documents and to see the latest and realistic and proper assumptions and forecasts underpinning the budget figures.

REPORTER: If the larger deficit is likely, will you moderate your spending promises accordingly?

BOWEN: Well, we have already taken a very responsible approach. I mean, I remind you that the Leader of the Opposition stood in budget reply just a few weeks before an election, a few days before an election was to be called and spent not one dollar. I remember Scott Morrison saying: “Every time Bill Shorten's lips move tonight, he'll be spending.” Wrong! He announced $70 billion worth of savings. And so we’ve taken that responsible approach and will continue to do so. We have key strategic investments that we are making in schools and in health, particularly, but we are also paying for them and more through the tough decisions we announced in the lead-up to the election campaign over the last two months including the budget reply.

REPORTER: Mr Burke, what is it about the NBN leaker that makes you categorise him or her as a whistle-blower?

BURKE: Well, let's make no mistake as to why Malcolm Turnbull was upset about the stories late last year. The information that was released made clear that what was happening with the NBN was the opposite of what Malcolm Turnbull as Communications Minister had been claiming. We were seeing the NBN have a cost blowout to deliver slower speeds and for people to get the roll-out later. That's what was happening. It takes a very special sort of incompetence to have a broadband policy that is making the internet slower. It takes a very special sort of incompetence. And when the revelations came out about the mismanagement of the NBN, Malcolm Turnbull was rightly humiliated. Today, he will want to defer this story to being about anything but. But, the leak that we were talking about, the thing that has caused all of this to unfold was the fact that someone was willing to make sure the truth came out and the last person , who wanted the truth to come out was Malcom Turnbull.

REPORTER: Do you have any special knowledge of the categorisation of the whistle-blower rather than as someone who has broken the law?

BURKE: I have no special knowledge of the individual concerned. But I think as a result of this we have a lot of knowledge about Malcolm Turnbull. Malcolm Turnbull was wanting to make statements today about people's integrity being impugned. Be in no doubt here. The question of integrity is about the integrity of Malcolm Turnbull. Malcolm Turnbull made a name for himself talking about whistle-blowers. Malcolm Turnbull made a name for himself and actually also rested the leadership through a series of leaks that were coming that were all operating to his advantage while Tony Abbott was PM. We had leaks from the National Security Committee, we had leaks that were coming that were to the direct advantage of Malcolm Turnbull. He doesn't want to talk about any of that, but be in no doubt when a leak came out that humiliated Malcolm Turnbull everything unfolded very differently and that's a reflection on him.

REPORTER: If it’s as the AFP Police Commissioner Colvin said today that the offending by the leaker has been ongoing, are you suggesting the AFP should ignore that ongoing behaviour?

BURKE: The comment I'm making is not about the Australian Federal Police. Look at the question that Malcolm Turnbull and his ministers are still running a mile from. From the time that the leak first occurred, until the time that the NBN made their request of the Australian Federal Police to intervene, what conversations happened between the Government and NBN Co? What conversations happened there? What intervention happened through Malcolm Turnbull, his Minister or their officers? And any time a question remotely close to that happens, Malcolm Turnbull runs a mile. This goes to his integrity and that's exactly where this issue lands.

REPORTER: What do you make about the ongoing nature of the leak mentioned by the AFP? Presumably we don't have ongoing intervention by the Prime Minister saying: “have you raided the ALP yet?”

BURKE: Once an investigation is commenced, and if you're inviting me to make negative comments of police investigations, you're not about to hear it. What you will hear though is the process leading to it being requested that there be an AFP intervention here was extraordinary, extraordinary. When you think that we're talking about the difference between national security leaks either that advantage a putative Prime Minister or national security leaks that provide information about the Defence White Paper, compared to a leak that humiliates an individual, who wants to be and is now Prime Minister? Now, they are of a very different order. I don't know how many of those different examples resulted in referrals to the Australian Federal Police. I do know how many resulted in raids.

Tony Burke