Transcript: Radio National with Fran Kelly

Interview

WTC012/2015

14 May 2015

Topic: Northern Australia, Tax deductions for farmers, East West Link, Paid Parental Leave

Fran Kelly: Northern Australia could be opened up to greater economic development following this week's Federal Budget. The Government will offer concessional loans to help build ports and pipe lines, electricity, and water infrastructure in the top half of the country which could be home to more than two million people by about 2030. That's part of a grand plan. The Deputy Prime Minister Warren Truss is also the Minister for Infrastructure and Regional Development. Minister, welcome back to Breakfast.

Warren Truss: Good morning.

Fran Kelly: The Top End obviously offers a lot of untapped promise. Governments talk about it and talk about it. Now, you've got the Northern Australia Infrastructure Facility to offer loans at cheap interest rates to the northern states and private enterprise, but there's not a lot more detail than that to this proposal. Can you tell us one specific project this scheme could like—could help build, or you would like it to help build?

Warren Truss: Well, this is a significant part but by no means all of the Northern Australia package, which we'll be releasing over the next few weeks. Two announcements have been made so far. One is in relation to the beef roads. We've released the infrastructure audit for the north and now we're making and demonstrating a real commitment to provide the core infrastructure that will be necessary to support a larger population in the north through this concessional loans arrangement. Now, there are lots of projects that have been talked about in the north. As you know, the north has been a place of dreams and a lot of those dreams have not yet been delivered, but the potential clearly remains and as the tropical part of our continent, the climate zone shared by two-thirds of the world's population, it has enormous potential to provide global leadership in science and technology and in delivering food and fibre to that sector of the globe. Now, we're talking about railway line upgrades, pipelines, electricity stations, the big pieces of infrastructure that are going to be necessary to support a larger population.

Fran Kelly: Okay. I noticed that the Queensland Resources Council has welcomed it as great news for boosting the resources sector in Cape York and the North West. Do you expect the focus will be on the mining sector?

Warren Truss: Well, there's already a strong focus on the mining sector in the north, but…

Fran Kelly: But from this concessional loan scheme, do you think that's when most of it will get built in conjunction with mining rather than agriculture?

Warren Truss: Well, a number of the projects that have been talked about include things like the very necessary upgrade of the Townsville to Mount Isa railway line. It's been there for a long time and has incredibly slow speed limits on it at the present time. There's talk of new railway lines which will link the centres and some of that, of course, will be funded as a result of the mining wealth of the region, so I think mining will be one of the industries which will continue to grow in that area. But there's also huge potential for agriculture, tourism, and I think we should not overlook also the important role we expect the larger urban centres—your Townsvilles, your Cairns, Darwin, Karratha and the like. They have the potential to be hubs for learning, for science, tropical medicine, et cetera, to be global leaders in advances in this region. And so we want emphasis also on the infrastructure in those larger urban centres.

Fran Kelly: Warren Truss, let me speak to you now as head of the National Party because the Budget included tax deductions for farmers for when they invest in new water facilities or fencing in particular. The Treasurer was very excited about that. He said the deductions would be immediate but in fact, they're not going to kick in until after 2017. Now, last night, Barnaby Joyce, the Agriculture Minister, revealed he's asked the Prime Minister to bring this forward though even under his request the concessions wouldn't be available immediately as they have been made available for small businesses immediately. Are you happy with this, and why aren't these concessions available for farmers immediately?

Warren Truss: Well, it's always good to make benefits available as quickly as possible, but they have to be affordable as well. There…

Fran Kelly: Was this a budgeting measure? To save money?

Warren Truss: Well, it's clearly a budgeting measure that provides benefits to the community and we've got to phase those benefits in as they're affordable. However, it's also significant to note that a lot of these measures are about drought resilience. We've got areas severely in drought at the present time and tax deductions are not much use to those people because they're not making any money, but what we want to focus these sort of benefits towards are those people having a good season now so that they can prepare for the inevitable time when they will also have a drought. So obviously the sooner…the sooner we can do…

Fran Kelly: [Interrupts] Yes, but I'm just saying—I'm just saying are you, as the head of the National Party, did you argue for the farmers to get those immediate concessions in the same way that small business operators and private contractors got in immediately once the Treasurer got to his feet at 7.30?

Warren Truss: Look, the sooner we can do those things the better and the Government's talking about how we can phase them so that they can provide the maximum benefit as soon as possible.

Fran Kelly: Minister, on the other area of your portfolio in Infrastructure, the Government's used the Budget to demand Victoria hand back the one-and-a-half billion dollars it gave the state to build the East-West Link the Victorian's…Labor Government's now abandoned that project and the Premier Daniel Andrews has basically told you to go jump. It doesn't look like you're going to get your money back but it is factored into the Budget. How are you going to manage this?

Warren Truss: Well, does this Premier have no honour at all? Now, he's already broken the contract with the major construction companies in Australia to put to an end the biggest construction project that Melbourne's really ever seen. He's broken…

Fran Kelly: And the voters of Victoria elected him on the back of that promise, though.

Warren Truss: But he's broken that commitment. Now he's breaking a commitment that the Victorian Government made to the Australian Government. Let me read to you a clause from the Memorandum of Understanding that underpinned this particular project. Section 329 says ‘in the event that the project is cancelled, the Victorian Government is required to return all Australian Government funding to the Commonwealth’. That is clearly in the Memorandum of Understanding.

Fran Kelly: Does that have any legal weight or any moral weight?

Warren Truss: Well, Premier Andrews can't keep walking away from the commitments of the Victorian Government. Who will ever trust Victoria again if the Premier's not likely to honour these sorts of commitments? And let me say, I don't think his position is very strong. When it really comes to the bottom line, we pay the Victorian Government in a year a lot more money than they pay us and I don't think he should get into a silly argument like this. He's got a clear obligation to return the money. I'll be talking to the Victorian minister later this week about ways in which we can ensure there is a healthy construction project in Victoria, and what new projects we might be able to bring on line as quickly as possible to Victoria…

Fran Kelly: So they could keep that money to pay for new projects if they come up with something?

Warren Truss: No, they can't keep that money; they've got to return it. That's a clear understanding in the Memorandum of Understanding.

Fran Kelly: And if they refuse, how will you manage that? How will you get that money back?

Warren Truss: Well as I said, the Federal Government pays to Victoria much more money in a year than they pay to us. That's not an argument they should be playing. What we should be doing is honouring the agreements that have been made and then talking constructively about how we can put in place a new program of works in Victoria. Now, unfortunately, there is inevitably going to be a couple of years' delay because Victoria doesn't have any shovel-ready projects ready to go…

Fran Kelly: Okay.

Warren Truss: …and, once that sort of thing is resolved, we can talk about a new program in Victoria. Now, we want there to be jobs in Victoria. That's important from a national perspective and we're prepared to work constructively with Victoria to achieve that but they've got to honour the agreements that have been signed by their predecessors.

Fran Kelly: Minister, on another issue, the Government is getting some pretty heavy criticism over its plan announced in the Budget to stop women claiming paid parental leave from the Commonwealth scheme if they have access to an employer scheme. Last night, Arthur Sinodinos, a senior member of the Government, said it's not a good look to be having a go at young mothers and he was critical of the language being used. Do you think it's a good look to be having a go at young mothers and saying they're basically engaging in rorts and fraud?

Warren Truss: Well, I think it's important that you acknowledge that the minister didn't say that, but [indistinct]…

Fran Kelly: Scott Morrison called it a rort; Joe Hockey agreed it was fraud.

Warren Truss: Well, those are words that were initially used by, as I understand, the interviewer. But having said that, clearly there are very generous paid parental leave schemes in many businesses. The leader of the opposition yesterday in Question Time referred to the fact that some large companies, including employers like Woolworths, employ a lot of married women, they…

Fran Kelly: And give them six weeks' leave.

Warren Truss: They're giving them extra paid parental leave and I think that should be encouraged for businesses to do that sort of thing but whether the taxpayer should, on top of that, then provide additional leave I think is a matter that does legitimately need to be debated and the Government's made a decision in that regard.

Fran Kelly: But Minister, let me ask you this. Have you thought through the policy impact of this? It would mean that if women have access to less weeks—or, fewer weeks of paid leave, they will be going back to work earlier, therefore infants—more infants will be going to childcare earlier. Are you at ease with that?

Warren Truss: Well, what we clearly need to do is have a system that is fair to everyone. The Government scheme is essentially a backup for those schemes in the private sector, some of which are very generous—are more generous than the taxpayers can afford to provide for the whole of the community. We should congratulate those employers and that will be an incentive for many women to want to work for those companies, and that's a good employment policy. And the Government is there to provide a safety net for those who don't have those benefits.

Fran Kelly: Warren Truss, thank you very much for joining us.

Warren Truss: You're welcome.

Fran Kelly: Warren Truss is the leader of the National Party, Deputy Prime Minister, and Minister for Infrastructure and Regional Development.