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Hon. J.B.

Interview with Neil Mitchell, Mornings with Neil Mitchell, 3AW
Monday, 19 January 2015
Neil Mitchell:
Federal Treasurer is on the line, Joe Hockey, good morning.
Happy New Year Neil.
Neil Mitchell:
Thank you, well I hope it is. I mean youve got a few problems, havent you? Ive even read that
youve been at war with the Prime Minister. Is this right?
Neil Mitchell:
Dont believe everything you read. Its going to be a great year for Australia, its going to be a
positive year for the economy. We finished strongly at the end of last year, Neil. The
unemployment number that came out on Victoria just a week or so ago was very strong, a fall in
the unemployment rate in Victoria from 6.8 to 6.5 per cent. I think, more importantly, more jobs

were created in Victoria last year than in the whole of Australia the previous year, and it will get
Neil Mitchell:
As reported, did you oppose as crazy the $20 cut to GP rebates?
I supported the decision, Neil. Its gossip. One of my resolutions - and I have a number of good
resolutions this year - is not to engage in discussion about gossip. Here I am, Im not going to
discuss it.
Neil Mitchell:
Lets not discuss it is it wrong?
Im not going to engage in discussion on gossip. We made a decision, a unanimous decision,
we hear what the doctors are saying, we hear what the medical professionals are saying.
Sussan Ley is going to be speaking with everyone concerned. We are going to make sure that
Medicare is sustainable.
Neil Mitchell:
But Treasurer, it is chaotic government. You make a decision you say is right, you dont consult
and then you reverse it. I mean that is not good government. That is sloppy.
Sometimes it is better to reverse a position than to continue with a position that is going to have
bad ramifications.
Neil Mitchell:
How did you get the decision so wrong?
Ill leave it for others to comment on that. What weve got to do is look forward and focus on
making sure that we can afford Medicare. It is a hugely important safety net for the community.

It is a hugely important issue for families and this year is the year of jobs and families for the
Commonwealth Government and that is what we are focussed on.
Neil Mitchell:
Do we have to accept that we are going to have to pay more, one way or another, to see the
For those most vulnerable in the community and for children that will not be the case and we
said that. But for those like you and me who can afford to make a contribution to the doctor we
should. Over the New Years break my little boy broke his foot. This is not uncommon for
families. He is five years of age. You take him to the hospital, go to see the specialist, get the xrays, get the cast. The only contribution I made and I earn a lot of money as Treasurer was $40
cash to get a water proof cast. That was it and I think, can I make more of a contribution? Can I
pay something towards the x-rays? Can I pay something towards the specialist? They said no. I
think that is inherently wrong. I should be making a contribution. Even though I pay a lot of tax,
even though I pay the Medicare Levy, that does not cover the growing cost of Medicare and that
is what we have got to do.
Neil Mitchell:
What level though do you cut in where people start to pay? That has got to be debatable.
Sussan Ley has consulted widely with the community and with medical professionals about it.
There is great news on the horizon for Australia. They fact that we are living longer is great
news. It is kind of remarkable that somewhere in the world today, it is highly probable, a child
has been born who will live to be 150. That is a long time. They would have said 100 years ago
that living to 80 or 90 was a long time. The question is how do we live with dignity. How do we
ensure that we have good quality of life the whole way through? This is the conversation we are
going to be having with the Australian people over the next few months. As the Intergenerational
Report is released, which gives the 40 year horizon on Australia, we are going to engage in a
deep conversation with the Australian people about this.
Neil Mitchell:

I want to go beyond the medical system as well, but will you look at increasing the Medicare
Levy for higher income earners further?
The Medicare Levy is actually increasing to help pay for the National Disability Insurance
Neil Mitchell:
Will it increase further?
We are certainly not inclined to do that. One of the challenges we have is that Australia now has
high rates of tax personal income tax - compared to some of our competition, particularly in
the Asian region. We need to be mindful of the competition because human beings are mobile
and we dont want a gradual outflow of Australians to work overseas because of the lower tax
rate. Weve got to be competitive but we have also got to raise revenue that maintains our
lifestyle. It is a difficult balancing act but we will get there because thats what we do.
Neil Mitchell:
So what is more important, cutting corporate tax or personal tax?
Youve got to look at competition. I want to give families a bit of a break with cost of living. Thats
certainly Tony Abbotts view. There is a very strong wish to put more money into the pockets of
Australians. It is their money. When Australians spend the first six months of the year working
for the Government with tax rates nearly 50 cents in the dollar it is a disincentive. Youre working
July, August, September, October, November, December just for the Government and then you
start working for yourself and your own household income after that for another six months, it is
a disincentive. Weve got to bear that in mind. Weve got to bear in mind that bracket creep is
going to put middle income Australians into the second highest tax bracket over the next few
years which is a disincentive for people to work and at the same time weve got to recognise
that there is a lot of competition for corporate investment.
Neil Mitchell:

So whats your priority, personal or corporate?

Well its not either or, my priority is to make sure we raise the revenue that funds our quality of
life and more importantly funds our future.
Neil Mitchell:
Is tax relief for families a possibility this year?
We did have it last year.
Neil Mitchell:
But youre talking about putting more money into families pockets - the theme for the year. Is
there the possibly of tax relief for families this year?
There is a scheduled tax cut that is still on the books to kick in this year and that is a change in
the threshold that is a legacy from the carbon tax. It is also the case that we have seen a
significant drop in petrol prices and that is going to have a big positive impact for families. In
Melbourne alone petrol prices were seven cents less last week, Im going off the official data not
what people are seeing outside the service stations now, but last week it was 112 cents a litre,
officially, the national average was 119 cents per litre. Obviously it has come down. That has
been a very good helpful stimulus.
Neil Mitchell:
Some of the specific areas, will there be changes to superannuation?
No. We said we are not changing superannuation before the next election and we are going to
have a period of stability. Were sticking to the period of stability.
Neil Mitchell:
Will there be changes to negative gearing?

No, we have no plans to change negative gearing. We can go through the whole list.
Neil Mitchell:
I guess the GST is the big one and youve committed you wont make changes before the
The thing about the GST, it is a great issue to have a Summer debate about. The fact is we
dont want to see an increase in cost of living and we dont want to be in a position where if
there is going to be a change to the GST there is not unanimous agreement. You need
bipartisan agreement and you need all the States to agree. The States receive every dollar of
Neil Mitchell:
If you dont get bipartisan agreement you wont take it as a policy into the next election?
In relation to GST it is our very strong view that youve got to have unanimous agreement. The
challenge here Neil is, as I said, over the next few weeks and months were going to be
discussing with the Australian people how we prepare for our future as a nation and as
individuals. Youve got to have a solution. Youve got to have a plan. We do have a plan and we
are prepared to improve that plan after further consultation with the Australian people. Doing
nothing is not an option, it is not a plan.
Neil Mitchell:
Youre talking about tax relief, corporate and personal tax relief, youve thrown out some of the
changes on Medicare, how do you get back to surplus?
You have to proceed with difficult decisions if you want to get back to surplus. We need to
reform higher education, you need further welfare reform, but it has got to be fair. It has to help
those who are most vulnerable because ultimately it is better to help those most vulnerable with

more than to just have a wide net where there are a huge number of people who get less. My
strong view, and the strong view of the Government, is that you want those most deserving,
those most in need, those most vulnerable, to get more. If you broaden the reach so that
everyone gets a bit then it means that those most vulnerable get less.
Neil Mitchell:
So the rich are paying?
It cant be just the rich. It has to be everyone who can make a contribution does. The rich should
pay, certainly, but it is not rich versus poor. It is about how we as a nation united can get ahead.
Neil Mitchell:
A couple of other quick questions. How are you going in talks with the $3 billion in Victoria for
infrastructure spending? I thought we were close to a deal there with the new Labor
We have been talking as you know. I am still hopeful that Premier Andrews will change his
position on East-West. 7000 jobs, 600 people employed now. 600 people will be sacked now if
East West does not proceed.
Neil Mitchell:
So its not close to a deal yet?
Not that Im aware of. We committed the money for the project and its not just about the 7000
jobs now, it is about improving the traffic flow, shortening the travel time across Melbourne and
importantly helping to lift our economic activity as a nation. There are certain criteria that need
to be fulfilled as part of any negotiation or discussion. The focus has to be on jobs and
strengthening the economy.
Neil Mitchell:

Reports today about Chinese businessmen buying up a lot more in Australia. It has been
described as quite a buying spree. Are you comfortable with that?
We need foreign investment as a nation. Were a big nation with a small population and the only
way were going to build is if we have investment from others that creates jobs. The Americans
are still by far the largest investors in Australia followed by the UK and a number of others
before China. If they are creating jobs, if theyre employing people and building things to give us
a better quality of life, we welcome that investment.
Neil Mitchell:
Just two quick final questions, any more policies that might need to be dumped?
I hope not.
Neil Mitchell:
Well you have dumped enough. Dont dump good policy. Even if it is tough to sell.
That is why we are sticking with a range of policies that not only we took to the last election but
the ones that are hugely important like the changes to education.
Neil Mitchell:
Youre in a bit of strife, arent you?
Neil Mitchell:
The Government is not in strife? What?

You can make whatever comments you want, mate, Im focused on my country. I am more
positive about Australia than I have ever been. We are in a great position at the moment.
Neil Mitchell:
Yes, but are you positive about your Government?
Everyone can comment Neil; Im not going to get into idle comment. Im focussed on delivering
for the people who listen to your programme. That is the only reason Im in this job. Seriously
mate, if you listen to the gossip, if you listen to the commentary of which there is much...
Neil Mitchell:
We need leadership, not indecision.
Let me tell you, we are providing strong leadership. In fighting the war on terror, we are
providing strong leadership. In national security we are providing strong leadership. On the
economy, despite the domestic challenges, we are delivering the jobs, and importantly it is
going to get better this year.
Neil Mitchell:
I really appreciate your time. I look forward to speaking to you regularly. And how is your sons
You know what surprised me about a five year old is how quickly they mend. He has recovered
well and then the 8 year old thought shed break hers. Its good to be back to work Neil.
Neil Mitchell:
Good excuse for a lot of extra screen time, having a broken foot.
Let me tell you, as a parent I think it is a really hot button issue - the one you have touched on
about how much screen time your children have. What is important is where they get that

screen time from, how you monitor it and these damn apps where children can download if you
give them your password. One of my children is paying off a lot of money through chores
around the house because they downloaded apps on a mobile device. He is taking out the
garbage, washing the cars and a few other things as well.
Neil Mitchell:
Even with a broken foot?
No, this is another one, but it is a big issue for families.
Neil Mitchell:
Thank you for your time. Joe Hockey, Federal Treasurer.