Interview with David Speers, ABC Insiders

DAVID SPEERS, HOST: Murray Watt, welcome to the program. 
 
MURRAY WATT, MINISTER FOR EMPLOYMENT AND WORKPLACE RELATIONS: G'day, David, good to be with you.
 
DAVID SPEERS: So, industry groups are on board with Peter Dutton's policy, the Local Government Association too. Do you think this $5 billion fund is a good idea?
 
MURRAY WATT: Well, it's pretty revealing that after all of this time the only plan that Peter Dutton has put forward is pretty much exactly the same plan that we've had operating for months.
 
We've already put out there pretty much the same amount of money to do exactly the same thing as what Peter Dutton announced yesterday. In fact that money from us is already rolling out to assist state and local governments to do the kind of infrastructure works that Peter Dutton has just announced.
 
Of course, the other aspect that Peter Dutton wasn't so keen to go into, is that he's now also committing to making $19 billion in cuts to Labor's housing program. So really what he's talking about is a road to nowhere. He'll provide the infrastructure works, the same works that we are providing, but he won't be providing the housing which we're providing at the end of those roads.
 
DAVID SPEERS: Just to pick up on what you said there, my understanding is you have $500 million, not $5 billion for this infrastructure, power, water and so on. Just explain that to me, do you have $5 billion being put into this?
 
MURRAY WATT: We have a $4.5 billion program that is rolling out in stages, $1.5 billion has already been committed for exactly the kind of works that Peter Dutton announced yesterday-
 
DAVID SPEERS: I think $500 million of that is for those works, I was just reading the press release minutes before coming on air.
 
MURRAY WATT: Yeah, there is a $500 million component of that program, but all up it's a $4.5 billion infrastructure program - $1.5 billion is already rolling out to the States, Territories and local government, and we have another $3 billion available for states and territories as incentive payments when they actually get the work done. So, as I say‑
 
DAVID SPEERS: But is that for these connections, or is that more broadly for building homes?
 
MURRAY WATT: No, it's for exactly this kind of work, around these kind of connections, infrastructure, sewerage, utilities, those types of things. But, of course, the part that we've also committed to that Peter Dutton hasn't committed to is an extra $19 billion in housing that he said he would cut; the Housing Australia Future Fund, he's blocking the $5 billion Help to Buy Scheme, there's a new homes bonus scheme that we've put in place with states and territories that he'll cut as well. So, it's all very well to fund that infrastructure, like we're doing, but if there's no homes being delivered and funded by government at the end of it, that's not going to actually help anyone.
 
DAVID SPEERS: Yeah, I guess the difference here is Peter Dutton saying the Commonwealth would directly fund that work rather than paying money to the states and territories to do it. For the sake of compromise, would you be willing to support something like that if Peter Dutton would be willing to back your Help to Buy Scheme?
 
MURRAY WATT: Well, the point is, David, we've already got this program rolling. It didn't require the support of Peter Dutton, we're actually getting on with it. I don't think people really care whether the money is directed through States, Territories, local governments or private developers, they just want to see that work done, just as they want to see homes built, which is exactly what we're trying to do and we're being blocked from doing by the Coalition and the Greens.
 
DAVID SPEERS: You are being blocked on that measure, the Build to Rent measure as well. Presumably you'll take these to the election. Will that be it, or will you have additional housing policies?
 
MURRAY WATT: Well, we'll obviously reveal more on the housing front along with all of our platform heading into the election, David, but I think you can see a very strong contrast between the major parties when it comes to what we're prepared to do for housing. We even saw this week the Coalition admit that they are not prepared to even try to build more than 500,000 homes. It's no wonder they're not prepared to do that because they're cutting so many of our programs.
 
DAVID SPEERS: Just sticking with your plans, you will take more, you said, to the election on housing. Will that include any change on negative gearing and Capital Gains Tax?
 
MURRAY WATT: Well, what I've said more broadly, David, is that we will obviously reveal our policies on housing and other matters closer to the election, but you've seen many people, including myself, including the Prime Minister and the Treasurer, say that negative gearing changes are not part of our policy. We have the broadest, most comprehensive housing package in place already with many different elements to it. Changes to negative gearing are not part of that policy.
 
DAVID SPEERS: Yeah, and we've heard you say that, and others say that, ‘It's not part of our current policy, it's not part of our current plan’, and people remember the Stage 3 tax change that followed similar language. So again, will you take any change on negative gearing and Capital Gains Tax to the election?
 
MURRAY WATT: Well, all I can do is keep repeating, David, which is not part of our plan. We are trying to provide incentives to help renters buy their own homes, which the Coalition and the Greens are blocking. We are now announcing the first round of funding from our Housing Australia Future Fund. The Prime Minister was just in Queensland this week announcing the first thousand of those-
 
DAVID SPEERS: But the question's about negative gearing-
 
MURRAY WATT: So, there's a lot in our policy already.
 
DAVID SPEERS: The question's about negative gearing. What's the policy rationale for keeping these rules in place at the moment? Why do you want to keep the existing tax breaks there?
 
MURRAY WATT: Well, our focus, David, is about delivering an increase in supply of housing. Again, that's why we've got all those different parts of our program, they're all directed towards supply. We're also working with States and Territories about zoning changes-
 
DAVID SPEERS: But negative gearing ‑ I appreciate you want to talk about other things, but negative gearing, you believe that is important to boosting supply, and the Capital Gains Tax breaks too.
 
MURRAY WATT: No, what I'm saying is that our focus is on measures that will increase housing supply-
 
DAVID SPEERS: But my question is about why you want to keep these tax breaks.
 
MURRAY WATT: Well, I mean ‑ we just keep getting into the same banter, David, it's not part of our policy, it's not part of our plan, what we're focusing on-
 
DAVID SPEERS: It's not banter, it's a question. Why do these tax breaks need to stay?
 
MURRAY WATT: Well, we haven't made any decisions about that, David. We haven't made a decision to change that. We're talking about something that isn't part of the Government's plan, rather than the many things that are-
 
DAVID SPEERS: But why isn't it? That's why I'm asking, why isn't it part of your plan to change it; why do you want to keep them?
 
MURRAY WATT: We haven't received any advice to my knowledge that that will make a substantial difference to housing supply, David, and that's what our focus is on. What we're directing our effort towards is everything we can possibly do to increase housing supply; funding social and affordable housing, training up more construction workers, which we're doing; helping renters buy their own homes; providing the kind of infrastructure that Peter Dutton announced yesterday and that we've already announced. That's where our focus is.
 
DAVID SPEERS: OK. Just coming back to negative gearing. Is the policy there for high income earners to use so that they can buy multimillion dollar properties?
 
MURRAY WATT: No, no, I mean what I'm saying to you, David, is that to my knowledge we have not received any advice from Treasury or anyone else within government that making changes to negative gearing will assist with housing supply. That's what we want to do‑
 
DAVID SPEERS: I understand that.
 
MURRAY WATT: ‑and we'll be taking up those sorts of measures.
 
DAVID SPEERS: But are you happy for tax breaks to remain in place that help high income earners buy multimillion dollar properties?
 
MURRAY WATT: Well, that's been the established position in Australian politics for some time. We haven't received advice to change that, we haven't made a decision to change that. What we're focusing on is getting more houses built, and it would be really nice if we had some support from either Peter Dutton or the Greens to do so.
 
DAVID SPEERS: OK. But you don't support any sort of limit on how many homes or the value of homes that high income earners can negatively gear? 
 
MURRAY WATT: We haven't made any decision to do that whatsoever, David.
 
DAVID SPEERS: But do you want any limit in place, yourself, on what high income earners can do?
 
MURRAY WATT: I haven't put that case within government, I haven't put that case outside government.
 
DAVID SPEERS: You must have a view?
 
MURRAY WATT: Well, as the owner of one home that is heavily mortgaged to the bank, it's not something that I'm planning to do any time soon, and as I say, I haven't put that view forward to my colleagues, and I'm not aware of my other colleagues having decided to do that either.
 
DAVID SPEERS: No, but what do you think? Should high income earners have any limit on how much they can negatively gear?
 
MURRAY WATT: What I think, David, is that we should all be working towards building more homes, and it would be really good if Peter Dutton and the Greens assisted us in doing so.
 
DAVID SPEERS: All right. I'll move on, I'll move on. Look, jobs. We saw the latest jobs figures during the week, and as the Government points out more than a million jobs created since you came to office. They were much stronger, the figures for last month, than expected - 64,000 new jobs created. Would you describe the labour market as being tight?
 
MURRAY WATT: Look, I think ‑ yeah, I think it's a fair description of the labour market at the moment, David, where we've enjoyed a period of historic low unemployment levels over a very extended period of time. And as I said through the week, David, it is a remarkable achievement in the Australian economy to see over 1 million new jobs being created - the most that any government has ever delivered in any single Parliamentary term, despite a slowing economy and despite expectations of a softening labour market.
 
Now, it is a tight labour market. I meet with employers all the time, and the feedback that I receive is that it is becoming easier for employers to find workers than it was say 12 months ago, but it's still not easy. And again, that's one of the reasons that we're investing so much in skills and training.
 
DAVID SPEERS: It is a tight labour market, you acknowledge. It's for that reason that economists say it's going to keep upward pressure on inflation, make it hard for the Reserve Bank to cut interest rates. In your view, where does unemployment need to be to see inflation come down?
 
MURRAY WATT: Well, I wouldn't put a particular number on it, David, but what I would observe is that under our Government we have been able to more than halve inflation from the rate that we inherited when we came to office while also delivering record numbers of jobs. So, I think that we're having to reconsider some of the economic orthodoxy, which has traditionally been that you have to choose between lower inflation or unemployment rates. We've been able to do both at the same time. I'm not going to suggest that unemployment won't rise. We do know, as I say, the economy is quite weak in terms of economic growth. We are expecting to see a softening labour market, but it's a real tribute to Australian employers and workers that we continue creating these numbers of jobs despite all of the barriers.
 
DAVID SPEERS: Business groups are worried about your industrial relations changes that have been put in place, in particular, the multi‑employer bargaining rules. Your predecessor, Tony Burke, indicated they wouldn't apply in the mining sector, now they are. Are you willing to change the law to stop them being used in the mining sector?
 
MURRAY WATT: No, we've got no plans to do that at this stage, David. I mean, we have just commenced a review of the first batch of legislation around our workplace reforms, and we'll obviously see what people have got to say through that review. But there is a lot of alarmist rhetoric out there from some employer groups and the Coalition about what multi‑employer bargaining is doing. As I think I've pointed out to you before, for all of that bluster, there is one multi‑employer bargaining that has been actually reached at the moment in the air conditioning and heating industry. There are a number of other groups that have been authorised by the Fair Work Commission to do so. But you need to understand that there are several hurdles that have got to be cleared before the Fair Work Commission allows multi‑employer bargaining to occur, and that's why it's not breaking out right across the economy.
 
DAVID SPEERS: No, but there are miners who have now been compelled to engage in a multi‑employer negotiation. You already have a carve out on the legislation for general building and construction work. Why not a similar carve out for mining as construction has in the law?
 
MURRAY WATT: Yeah well, we took a decision when that legislation was passed to carve out the construction industry for some of the reasons that we've ended up having to deal with in terms of the CFMEU Construction Division. We just don't see that the same requirement is necessary for the mining industry. We are not seeing a break out of multi‑employer bargaining in the mining industry, for all of the complaints that are being made.
 
You're right, David, there is one case that the Fair Work Commission has authorised that to begin, but that's because in that case it cleared the hurdles. The Fair Work Commission determined that it was in the public interest to allow it. The majority of their workforce wanted that to happen. There were reasonably comparable interests between the companies involved, and there is no underpinning single enterprise agreement. So it's not an automatic entitlement to do multi‑employer bargaining, it's a pretty high bar to be cleared, including the Fair Work Commission deciding that it's in the public interest to allow it to occur.
 
DAVID SPEERS: Murray Watt, you were in the Queensland Parliament once upon a time before you entered the Federal Parliament. You lost your seat when Labor was swept from power when Campbell Newman won a landslide victory. Do you sense something similar is about to happen for the LNP and against Labor on Saturday?
 
MURRAY WATT: No, I don't, David. You're right, I did have one glorious term in the Queensland Parliament before I lost in a landslide, with a little bit less grey hair than now. I don't think that Queenslanders have got baseball bats out for Steven Miles and his team in the same way that they did back in 2012. As I mentioned to you, I was doing some door-knocking yesterday in outer Brisbane, I've been doing it in a number of other seats-
 
DAVID SPEERS: What's the feedback you're getting?
 
MURRAY WATT: Well, there's still a lot of undecided voters out there, David, is what I've found. And you know, while there are a large number of people who have voted already, there's a lot of people still making up their minds. So this week I think both sides have got all to play for. I do think that the campaign has closed the gap significantly between Labor and the LNP. I think most people would observe that Steven Miles and his team have run a great campaign, and David Crisafulli is emerging as a shifty, evasive person who doesn't want to talk about his plans for abortion reform, doesn't want to talk about cuts, and that's resonating with people.
 
DAVID SPEERS: OK. But your political judgment on which your federal colleagues will be relying come federal election time is that Labor is still in this race; they could still win on Saturday? 
 
MURRAY WATT: I never think that an election is over until it's over, David. I think it's pretty widely known that regional Queensland is more difficult for Labor. But having said that, I think there are parts of regional Queensland that we can still hang on. Brisbane on the whole is holding up okay for Labor, and I think it's very interesting to see some of the momentum of the Greens starting to stall. We saw that last night in the ACT election as well, where for all their big claims about winning seats they went backwards-
 
DAVID SPEERS: What do you put that down to?
 
MURRAY WATT: Well, I mean I'm not close enough to the ACT to exactly know that, but I think that what we are seeing here in Queensland is that people are noticing the Greens are increasingly blocking Labor's attempts to introduce progressive reform, and the Greens are starting to pay a price for that. It's one of the things about being in office, is that people can see your record, and here in Brisbane you've got three Greens Federal MPs who are consistently blocking Labor's attempts to build housing as well as campaigning against housing developments in their own electorates. So I think the Greens are starting to pay a price for that, but of course we'll see what happens next Saturday.
 
DAVID SPEERS: We'll see what happens on Saturday. Murray Watt, thank you very much for joining us this morning.
 
MURRAY WATT: Thanks, David.
 
ENDS