TRANSCRIPT OF THE PRIME MINISTER
THE HON JOHN HOWARD MP
TELEVISION INTERVIEW WITH STEVE LIEBMANN
TODAY SHOW, CHANNEL 9
11 July 2001
PRIME MINISTER:
Good morning Steve.
LIEBMANN:
I’ll come to the 80/20 controversy in a moment. But do you believe, do you believe some poor people are responsible for their own poverty and there is nothing your Government can do for them?
PRIME MINISTER:
Well I don’t believe there’s ever a situation where the Government shouldn’t help the poor. Tony Abbott didn’t say that. He didn’t. What Tony Abbott said, he really has been outrageously verballed on this by a lot of people, what Tony Abbott said was that in some circumstances people through their own behaviour contribute to their poverty. Now that is true and if a person in public life can’t say that without being belted around the head and misrepresented I think public debate has reached a very sorry path in this country. He didn’t then go on to say ‘and what is more we don’t care about it’, he didn’t say that at all. So he said some people contribute and he acknowledged as I do, and I reaffirm that we have a moral obligation to help the under privileged.
LIEBMANN:
So from your point of view Abbott is not becoming a liability because of his propensity to shoot from the lip and leave it for others to clean up.
PRIME MINISTER:
On this particular issue Steve, what he said was correct. He’s been the victim of misrepresentation and I defend him. And what I say is that we’ve got to be able to talk about the causes of poverty. Many people are in poverty through no fault of their own but whether they are there through their own fault or through the consequences of their environment or their family background then we still as a compassionate society should help them subject to the principle that if people are able to give something back, this is work for the dole, mutual obligation, in return for the help they get then we ought to ask for it. Now, that is a fundamental principle. Society carries rights but it also carries responsibilities.
LIEBMANN:
But surely, especially at this time his comments were unhelpful and sensitive.
PRIME MINISTER:
Well Steve, if some people… if people are deliberately going misrepresent it, and I notice, it seemed to me to be one or two news outlets only focused on this. I mean last night commercial news didn’t carry it, the ABC ran very heavily on it, look I had a look at what Tony said, I listened to it and he’s been misrepresented. What the bloke said was that in some circumstances, some people contribute to their own dilemma. But he didn’t then heartlessly go on to say ‘look we don’t care anyway’, I mean he didn’t say that. In fact he really is a person who believes very strongly in the social security safety net as do I.
LIEBMANN:
But he also said that the poor are getting poorer and the rich are getting richer.
PRIME MINISTER:
Well I haven’t seen that part of his comment. I was shown a transcript this morning of what he said on…
LIEBMANN:
I think he said that’s a myth.
PRIME MINISTER:
What, he said the ‘poor are getting poorer is a myth’, yeah, that is a myth. Because if you actually look at the figures, the gap is more that the people at the top are getting wealthier, not that the people at the bottom are falling further below. That’s not, I mean in fact over the last few years we have put something of a floor under the income support level of the poorer section of the community and my Government’s done a lot on this, the former Government did some good things as well. But Steve, we’ve got to be able to have a sensible debate about this. The important thing is that you have a strong social security safety net to help the genuine poor but then over and above that you have got to encourage in people a sense of personal responsibility. We cannot have a society where people don’t have any sense of personal responsibility, I mean we’ve got to develop self reliance in our community. This is part of the problem with Aboriginal communities.
LIEBMANN:
Alright, talking of liabilities - and you obviously reject the suggestion that Abbott is - are you becoming frustrated with the way the tax office is managing the tax system, the way it’s implementing change?
PRIME MINISTER:
Steve, if you’re talking about the contractors legislation…
LIEBMANN:
I am.
PRIME MINISTER:
Well, we have fine-tuned that. We haven’t backed away from it. We are still…
LIEBMANN:
You haven’t back flipped on it?
PRIME MINISTER:
No, no look I don’t mind the… I’m not phased by these words like backflip and backdown. When you have a big change to a tax system as we have had, you have to be fine tuning it all the time.
LIEBMANN:
Bet it’s a mess at the moment.
PRIME MINISTER:
Oh well no Steve, with great respect it’s not a mess. If you are an independent contractor, in other words whether you’re doing 80% of the work for one person or not, if at the end of the day you are responsible for your work and if something goes wrong you potentially can be sued for it then you’re an independent contractor and you’re not in any way affected by these changes. But if you are in reality an employee and you’re sitting beside somebody who’s being paid as an employee and having his tax taken out each week and you’re being treated differently, isn’t it…and your liability is no greater than the bloke next to you, aren’t you really, you know isn’t society under an obligation to say ‘hang on, Howard we’ll treat you the same as we treat Liebmann, because you’re both doing essentially the same work’, I mean I don’t think there’s anything unfair and that essentially is what this has been all about. Now you’ve always got to fine tune big changes to the tax system.
LIEBMANN:
The Treasurer’s saying one thing and then the Taxation Commissioner is interpreting it another way and everybody’s…
PRIME MINISTER:
No, no Steve, some people are sort of trying to make it more confusing than it really is and I don’t think, I mean the Tax Commissioner issued a statement last night for example dealing with couriers. I mean we’ve had all these stories that every courier in the country is going to be caught up. What the Tax Commissioner said is ‘I’ve had a look at the standard contract for couriers and if you’re on one of those you’re an independent contractor’. Now, that’s pretty simple. I mean some people generate confusion and they manufacture confusion. Now any change to the tax system is hard and this Government has had the courage to change the tax system in the way that we’ve needed in this country for a generation. Inevitably you have to fine tune it along the way and I’ve made it clear that if we have to fine tune any part of this vast tax change, I’m not talking about the contractors, I’m talking about the whole lot, in the future then we’re ready to do it. And people aren’t! going to intimidate me out of doing it with erroneous use of words like backflip.
LIEBMANN:
But is self assessment, this latest piece of fine tuning, is that going to change anything? It’s still going to cost people time and money, they’re going to be confused.
PRIME MINISTER:
No no, what it’s going to change is that if people know they’re an independent contractor then they don’t have to go along to the tax office and go to the trouble of filing...
LIEBMANN:
You can’t tell them three years down the track the Taxation Commissioner, who ever it is is not going come back at them and say…
PRIME MINISTER:
Oh yes yes, but he can only come back at them if he’s got a right to. If they are clearly an independent contractor he won’t come back at them, otherwise he’ll lose the case.
LIEBMANN:
Are you satisfied with Michael Carmody as Taxation Commissioner?
PRIME MINISTER:
Yes I am, look it is a difficult job.
LIEBMANN:
Does he have too much power?
PRIME MINISTER:
Well if he’s got too much power it’s the power Tax Commissioners have had for a generation under governments of different persuasions. Look, if you don’t have an independent Tax Commissioner, then people will be coming to the Treasurer and the Prime Minister to have their tax returns reassessed and you don’t want that. I tell you I don’t want that. I mean you can’t run a tax system on any other basis than having the Tax Commissioner with a certain amount of independent power. But the important thing is that we have reduced personal income tax, company tax fell from 36 to 30% on the 1st of July. Financial Institutions Duty is gone. I mean we have a lower level of tax, our exports are booming…
LIEBMANN:
I know.
PRIME MINISTER:
Well it’s pretty important. We lose sight of this. I mean our export performance has been gang busters over the last few months, one of the reasons - I mean, low exchange rate helps too – one of the reasons is that we no longer have tax on exports and that’s part of tax reform.
LIEBMANN:
But the tax office is saying as recently as last night, it will now consult with industry to develop further the contractor tax law guidelines. Shouldn’t it have done that in the first place?
PRIME MINISTER:
Oh, people can say that Steve….
LIEBMANN:
But it should have.
PRIME MINISTER:
Well except that there was a lot of consultation. I had a meeting at the weekend in Canberra with a whole lot of people from the tax office about this contractors issue. I mean I got interested in it because I listen to people’s concerns about the way it might be implemented. And there had been a lot of consultation, there can always be more, nobody’s perfect, Prime Ministers down. But the important thing is that when you have a big reform like this you have to be willing to listen to people who along the way want it fine tuned. But this contractors thing, it’s fairness, it’s not, we’re not trying to catch genuine independent contractors. I mean I say to them again, if at the end of the day you’re responsible for your work, you’ve got to rectify it, you’ve got to remedy mistakes, you’re potentially liable, you’re an independent contractor. If you’re not then you’re an employee and why shouldn’t you be treated like any other employee.
LIEBMANN:
In Carmody’s defence he is only working with the legislation.
PRIME MINISTER:
Yes
LIEBMANN:
And commentators would suggest that the law is flawed.
PRIME MINISTER:
I don’t think it is flawed to have a law that operates the way I’ve just described it, do you? Do you really think it is fair that if somebody, if two people are working in the same outfit they should be treated the same.
LIEBMANN:
I appreciate that.
PRIME MINISTER:
But equally if one of them has got to carry responsibilities that the other one hasn’t then they should be treated differently.
LIEBMANN:
Final question. Do you believe Beijing should be the site, the venue for the 2008 Olympic Games?
PRIME MINISTER:
Well I think there are some obvious concerns by some people, about human rights issues. I hope the Chinese respond to that but in the end if they’re chosen then we would support it.
LIEBMANN:
We being the Australian Government.
PRIME MINISTER:
Oh yes. If Beijing is chosen as the site, the Australian Government would support that decision and we’d work very hard to make the Olympic Games there a success. I think Beijing has a very strong claim by dint of it being the capital of the largest nation on earth, I understand and am sympathetic to some of the human rights criticisms that are made. But in the end if it’s the decision of the International Olympic Committee to choose Beijing we will strongly support that decision.
LIEBMANN:
Thanks for your time.
PRIME MINISTER:
You’re welcome.
END
