Tim Watts MP

Federal Member for Gellibrand


SUBJECT/S: Andrew Robb; Stuart Robert; GST and tax concessions; Closing the Gap

Joining us in Canberra, our breaking news reporter will be Senator Scott Ryan, Liberal Senator for Victoria, he is the Assistant Cabinet Secretary, so he helps Cabinet Secretary Arthur Sinodinos guide the Cabinet agenda. Scott, good afternoon.




EPSTEIN: And Tim Watts is the ALP Member for the seat of Gellibrand here in Melbourne. Tim Watts, welcome to the program.


TIM WATTS, MEMBER FOR GELLIBRAND: G’day Raf, I’m excited to make my Fight Club debut today.


EPSTEIN: Very exciting.


RYAN: Debut!


EPSTEIN: It is a debut, however I need to ask our breaking news reporter Scott Ryan what is going on with Andrew Robb?


RYAN: Look, I saw the ticker as I walked into the studio here, but Raf I don’t know anymore.


EPSTEIN: Okay, so news to you that he is retiring?


RYAN: I saw the ticker, and I’ll let my colleagues talk for themselves one way or the other.


EPSTEIN: Not quite news, not quite breaking news. Possible that he, the ABC is reporting that he could step down from being Trade Minister tomorrow Scott Ryan, is that – I mean you’re a Minister now – could that work?


RYAN: Those are discussions that ministers and parliamentary secretaries like me have privately with the PM, I am not aware of any conversation like that. If the conversation had happened it would have been private with the PM, I honestly don’t know.


EPSTEIN: Okay. One final question for you on reshuffles, happy to have Barnaby Joyce as the Nationals leader? That is probably the most likely option.


RYAN: Let me just say that I don’t want to get involved in the National Party Room, but I know Barnaby from my time in the Senate and I have worked with Barnaby and quite frankly I actually learnt a bit from Barnaby. I grew up in the suburbs of Melbourne and we once did a native vegetation inquiry where we went around the country and I learnt quite a lot and I think Barnaby brings not only a clarity – because he has the power of words – but he is also very committed to bringing the perspective of regional and rural Australia to suburban people like me who might not have had a lot of experience of it. I think Barnaby has made a great contribution and it is up to the National Party who they decide to select if and when Warren Truss decides to retire.


EPSTEIN: Tim Watts I cannot let it go by without giving you at least a chance to make an observation. You are new to the Parliament; you are watching people like Andrew Robb and Warren Truss walk out the door, what do you think?


WATTS: I’m new to the Parliament but I am not new to the merry-go-round of Coalition Ministers coming in and out of the job. It seems like we are losing another one every other day of the week and while there wasn’t a sniff of Andrew Robb retiring in Question Time today, Stuart Robert’s performance certainly didn’t make me think that he would be long for this ministerial world. 


EPSTEIN: Let me ask you – people might not know that Stuart Robert is a junior minister under a lot of pressure over a trip to China – however, and I don’t want to get into the detail Tim, but he did go after seeking explicit approval from the former Prime Minister’s office. As much as we know he gave them a good idea of what he was doing, took personal leave and paid for his own flights from Singapore to China, so if he got the tick of approval with a detailed letter from the former Prime Minister’s office, that provides you some cover doesn’t it?


WATTS: Well, Raf, if Stuart Robert went to his superiors and said “I am going on a visit to a Chinese minister accompanied by a Liberal Party donor to talk about an investment that they want to make in a company in Australia” I would fall over dead if they approved that. That is a clear breach of the Ministerial Standards and what we saw in Parliament today –  it was like Weekend at Bernie’s – Stuart Robert was shuffling back and forwards from the dispatch box with Malcolm Turnbull desperately propping him up because he doesn’t want him to fall over during a parliamentary sitting week. He is gone for all rights, and if Malcolm Turnbull had any skerrick of leadership he would put him out of his misery now.


EPSTEIN: Scott Ryan, care to comment on Stuart Robert?


RYAN: Let’s put this in perspective. There have been some claims made in the media and the Prime Minister, the first thing he did was to seek some advice from the head of the Prime Minister’s Department on the facts, and some advice on the guidelines. That is the entirely appropriate thing to do, that was only 48 hours ago, that was Monday. Now, what we have from Labor and from Tim and from Mark Dreyfus is all of this confected outrage about nothing. Yet at the same time when we have had things like a Royal Commission that have made findings of fact, that have made things about laws being broken exceptionally clear they don’t seem to show any concern about those matters. This is the appropriate way to deal with it, to seek advice on the facts, to seek advice on the guidelines and as the Prime Minister made clear, he will then make a statement. Now, due process sometimes requires more than the 48 hours of confected outrage that we have seen from the Labor Party.


EPSTEIN: Still, there wouldn’t be too many people in the Liberal Party Room betting that Stuart Robert is going to remain in the Ministry, it doesn’t look good.


RYAN: Well, I don’t gamble, and I think this is one of the things that Malcolm Turnbull has made clear, that this is not going to be a Government driven by the media cycle like we saw by Kevin Rudd, this is not going to be a Government that decides to skip due process because certain people are confecting outrage. No one has come up with an alternative to what the Prime Minister has said. I want clarity on the facts; I want some advice on the guidelines. To do that in over more than 48 hours I think is entirely reasonable.


WATTS: The reality, Raf, is that this due process that Scott is talking about is the Prime Minister initiating this inquiry two minutes before Question Time started earlier this week, we have found that out in Estimates now.


EPSTEIN: It is a sensible thing to do, isn’t Tim Watts? The leave for absence from the former Prime Minister’s office, it is kind of good, he is trying to de-politicise the process isn’t he?


WATTS: Stuart Robert has admitted to breaching the Ministerial Guidelines in Parliament. You do not need an inquiry to establish that. This inquiry is a crutch to get through to the end of the parliamentary sitting week. Scott might not be a betting man, but I am happy to make a bet with him right now that when we get to the weekend that Stuart Robert will not make it to Monday.


RYAN: Labor MPs still turn up to these Union slush-fund raising dinners. Labor MPs are in Parliament, they protect the CFMEU, we have had a Royal Commission into these matters – this is confected outrage.


EPSTEIN: I am not sure the Royal Commission found any facts pertaining to the behaviour of an MP, but look let’s move on.


RYAN: No, it didn’t, it was about Unions – I agree.


EPSTEIN: Scott Ryan is with me, he is the Assistant Cabinet Secretary. Tim Watts is the freshly minted member for the seat of Gellibrand. At least freshly minted compared to those who are walking out the door soon it seems. It is sixteen minutes to 5 O’clock – Scott Ryan is a 15 per cent GST still “on the table”?


RYAN: All of the options for tax are on the table, what the Prime Minister said on Sunday was that he took the public into his confidence by saying ‘we started this discussion last year, there are two tests for tax reform – does it grow jobs and does it grow the economy? And is it fair?’ – So then on Sunday what he made clear was that he remained to be convinced. They haven’t convinced him yet that the GST is the best path to do that.


EPSTEIN: So a PM not convinced means off the table, surely?


RYAN: No, he said he is not convinced yet. Obviously the process has been going on for four months; this has been an open and public process and I happy to have seen my colleagues express their opinions. It is taking the public into our confidence and actually seeing this debate happen publically rather than happen behind closed doors. But obviously, we indicated that the Budget in May would be about the time that we would come to some conclusions and take the public further into what our priorities are and there is only three months to go until that. So the Prime Minister was being open and honest by saying “I am not yet convinced, but we are committed to these two tests being the tests for any tax reform”.


EPSTEIN: Tim Watts, at least we have had a Government willing to entertain ideas, this is good isn’t it? If we don’t have people instantly ruling things in or out, it might not be a perfect debate but at least it is more of a discussion than we have had in the past.


WATTS: Malcolm Turnbull is the Prime Minister; he is not an economics professor. We have had a great tutorial in economics 101 from the PM but when he challenged Tony Abbott five months ago, what he promised – his core proposition – was that he would deliver economic leadership, the economic leadership that we didn’t see from the Abbott Government. Now… (Interrupted)


EPSTEIN: We are not seeing fantastic ideas about hoeing into the deficit from Labor, I mean people in glass houses… (Interrupted)

WATTS: We have released a wide range of taxation policies, some of which it would appear the Treasurer is coming around to now. The key point on the GST is that we know that Malcolm Turnbull wants to do it; he just can’t work out how to do it yet. He has seen Labor’s opposition to it, to increasing the GST, and now he is confronted with a situation where he is finding it a little bit difficult – the train is getting a little bit more rough – and he is trying to decide whether to go over it or not. And so far, we have had a Hamlet-esque soliloquy of will I, won’t I, and he is squibbing it.


RYAN: How has Tim come to the conclusion that he knows what is in the Prime Minister’s mind? The Prime Minister has said ‘these are the two tests that I am going to apply to any economic package’ he has never said ‘I want to do a GST’ he said ‘I want to test the options I have got - those that will grow jobs and the economy and those that are fair’. And we didn’t rule things off the table the way Swan and Rudd did, we didn’t do something in secret and thump a report on the table and only take the tax increase options. We have made it clear that anything we do after the election we are going to ask the public for permission for.




RYAN: This shows that Labor can’t have an open debate that is what it shows.


EPSTEIN: Let’s try and find some mutual ground now, there is a draft law being introduced that is going to make people pay GST on things like Netflix. Labor has a policy on multinationals – not the biggest tax in the world but it is 7 or 8 billion dollars over 10 years – however let’s try and crack down on multinationals. The ATO Commissioner Chris Jordan had some really strong words to say in Estimates and I think he is adding a number of companies to his name and shame list at some stage. Would either party actually support naming and shaming the big multinationals that the tax office thinks is seriously trying to dodge its obligations? Scott, would you back that idea? Because that's seems to be the only way around the world that we get the extra money from them.


RYAN: Well I don't actually know that that will do it either. The truth is, I want to leave these decisions in the hands of the tax commission. I don't think they should be subject to the political process where we see a lot of political grandstanding, particularly in the Senate committees by people like Sam Dastyari. If you want to have a serious tax debate, and you want to do things like that seriously, and they are serious issues, they're not going to solve the budget deficit. They're not even going to come close to it. But they are important to the integrity of the system. I think they should be left in the hands of the tax commissioner because he is independent of parliament and independent of government. And he is well equipped, or she is well equipped, to make these public statements because that's their job.


EPSTEIN: Tim, would you support a bit of naming and shaming? It's had some effect. I think it's Starbucks and google in Britain that have paid, and they didn't have to, because they were named as effectively trying to get around the laws. Is that a tactic worth trying?


WATTS: It's a question of priorities. It's certainly something that I would want to look at before I considered increasing the GST by 50 per cent, which has been shopped around by the Government for the last five months now. Scott can denigrate the work of Sam Dastyari and these Committees but I think that average Australians are outraged by the fact that there can be major multinational corporations bringing in millions and millions of dollars of revenue and paying no tax while the treasurer and the Prime Minister are floating increasing the tax that they have to pay out of their back pocket when they go to the supermarket, when they're paying their rent, when they're doing the kinds of things that everyday Australians can't avoid doing. Now, if I'm setting priorities for taxation, I'm looking there before I'm looking in the back pocket of everyday Australians.


EPSTEIN: I don't know if I should be nervous or happy when the major parties agree on things like national security and indigenous affairs. But I'll start with you Scott Ryan on the Closing the Gap report. Some incremental improvement... Do you agree that a good solution would be handing more power to local indigenous communities? And if you think that could be helpful, why do you think that it hasn't happened more?


RYAN: Well I think one of the things we need to understand about indigenous communities around Australia is the varying circumstances that indigenous communities are in. The overwhelming majority of indigenous Australians live in urban areas, but we also have significant indigenous communities in remote areas and sometimes the challenges are quite different. So i think we've got to not have a one size fits all model. We're seeing some of the work Noel Pearson is doing up in Cape York working very well. But I know that some people don't necessarily think that would apply to other parts of Australia. I think the important thing about today is that it's an Annual Report, it's an annual stocktake, it provides a platform and a voice for indigenous people, from right around Australia, from all of their varying backgrounds, and with their varying challenges. And what we've found out today is that we've halved infant mortality but we haven't done enough on closing the life-expectancy gap. We've improved on year 12 retention, but we haven't yet done enough on school participation. We have introduced a new target… which I had something to do with in my past role in education… in early childhood participation because we know that makes a real difference to school participation and results. And every year, the Leader of the Opposition and the Prime Minister have an opportunity to address these issues. And community leaders from around Australia have the opportunity to be the focus here, in Parliament, with all the media and all the MPs. And I think that, in itself, is a very important signal.


EPSTEIN: So do I, but I just wondered, do you think there is a bureaucratic culture that makes it, no matter what government is in power, what party is in power... makes it quite difficult to give local communities local solutions. Do you think that is a significant problem?


RYAN: Look, this is not an area of my specific expertise, other than my experience in education. And one of the things I'll say is that there has been sort of a movement in the pendulum, we moved away from the ATSIC model about a decade ago. And that was a bipartisan move away from that. We've moved to more measures that apply to all the people in certain communities, such as the welfare card, that doesn't just apply to indigenous people in certain communities, but to everyone. So I think we just need to be flexible. We can't say that simply going down one path is going to suit the needs of every community in Australia. The challenges are very different, some of them are very extreme, some of them are less extreme. What today is is actually a stocktake of all of them, and a report card, that does get the national attention that it deserves.


EPSTEIN: Tim Watts, I'm interested to know your thoughts on just trying to give local communities more power? But also BIll Shorten emphasised that he would go straight to a referendum on constitutional recognition, were Labor to win. Is there a risk that stops the issue being bipartisan and therefore kills off any chance of the referendum succeeding?


WATTS: Before jumping into that Raf, I should just say, as a new Member of Parliament, I find closing the gap day to be a really sobering day. I don't think it's a bureaucratic imposition. I think it's something that does hold our feet to the fire and force all MPs to really confront this issue head on. In terms of the referendum, I think it's an important thing to do, to put a date on this because otherwise, we'll be dithering and dathering forever. The reality is, there was a report that came out yesterday, the day before closing the gap day, called the State of Reconciliation report. And that report found that less than half of Australians think that the current disadvantage faced by indigenous Australians is a result of previous racist policies and disadvantage suffered by indigenous communities as a result of those policies. Now I think that shows there's an unspoken gap here, it's a gap of understanding.


EPSTEIN: Does it make a referendum less likely to succeed without bipartisan support?


WATTS: It makes it more important. Bridging that gap of understanding and having a national discussion about our history and about recognising indigenous heritage in this country, and the role that it played in past wrongs, is something that ought to be a serious part of closing the gap.


EPSTEIN: Scott, do you think that Malcolm Turnbull places as much of a priority on constitutional recognition as Tony Abbott does?


RYAN: In all honesty I don't know. The Prime Minister mentioned it in his statement today. There's probably no one more experienced when it comes to referenda and the challenges of them than Malcolm Turnbull. But this is one of my areas of speciality too. The great challenge of referenda has been that over the course of Australian history, and all of the people that have agreed with something have gotten into a room together and agreed that this is the right thing to do, they've never engaged with those people who are sceptical or those people that have a different view, and then the referenda, as we know in Australia, so many have failed. Now, some of them are very bad ideas I might add, and I would have voted against them myself, but I think what we have to understand is that we are a long, long way from there being a referendum proposal. There is a process in place. And there are people with concerns about how far it might go. And I might say, within the indigenous community, there is also significant variance of opinion as to what that referendum should say. So I don't think we should be jumping the gun and locking people into a date because I think that everyone can agree that no one would want something to go forward that did not succeed. But the proponents do need to deal with those who are sceptical, or those who have genuinely well motivated concerns, that quite frankly, we've spent thirty or fourty years in this country moving away from the legacy of race, and that is not something we should move back into. And I don't think that opinion is invalid, but it's not one that I think has been particularly strongly engaged with at the moment.


EPSTEIN: Just a final question for both of you, do you think we'll have significant improvement in five years? Tim Watts, do you think we're at a point now where there are enough people of goodwill concerned to move things rapidly forward, say in five to seven years?


WATTS: I wish I could share the Prime Minister's optimism on this. I don't doubt people's commitment to moving the needle on this, I don't doubt the resources that we can muster to it, but the evidence of us getting traction on this issue to date doesn't leave me feeling particularly confident about it. I hope I'm wrong.


EPSTEIN: I think we shouldn't get lost in the percentages here because there are thousands of indigenous children who are immunised now and are not going to face the burden of avoidable disease. There are tens of thousands more indigenous people, children in school and preschool. There are tens of thousands more of them finishing school with all of the life chances that brings. Halving infant mortality, that is one of the basic measures of a civilised society. So I think we've got to remember that in every one of these statistics there are individuals who have had their lives dramatically improved and offered hopefully the same opportunities we have. But we have a long way to go.


EPSTEIN: Good luck. I'm sure there will be some corridor parties tonight for Warren Truss and Andrew Robb. Enjoy them gentlemen, thanks for your time.




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