SKY NEWS FIRST EDITION
THURSDAY, 15 OCTOBER 2015
SUBJECT/S: Counter Terrorism Summit; Westpac Rate Rise; Malcolm Turnbull’s Investments in a Tax Haven.
KEIREN GILBERT: Joining me this morning is the Manager of Opposition Business, Tony Burke. Mr Burke, thanks very much for your time. This comment by Andrew Colvin last night, very concerning that even a twelve year old is on the radar of authorities. Extraordinary.
TONY BURKE, SHADOW FINANCE MINISTER AND MANAGER OF OPPOSITION BUSINESS: And you can’t contemplate how this is true. You also can’t contemplate how the family must feel. What the Government’s doing today is a good thing. We’re not at all critical in any way. We want to be helpful on this. We’ve offered to attend, the Government at this stage apparently have decided they don’t want us to. Mike Baird’s certainly involved the Opposition in the way he’s gone about things. But what needs to be understood with this, is we want it to work. There’s been some good things that Malcolm Turnbull has done since he came in. Changing the tone and offering to work more cooperatively with the community is really important. I just hope the sort of bipartisanship that can see this being dealt with in a really constructive way is where we end up.
GILBERT: You have a very large population of Muslim Australians in your electorate; what’s the mood like there? Given the events of the last few weeks, to see a 15-year-old shoot dead an innocent police worker and others arrested – the raids - what’s the mood like in your seat of Watson?
BURKE: You need to remember, for most people of Islamic faith, what they see and hear on the news, they see and hear on the news the same way we do. It’s people they don’t know and people who are nothing to do with them, the difference is there’s often an expectation people need to go and check whether or not they are actually opposed to atrocities. People feel that weighing down on them. Things that are nothing to do with them at all but constantly being told or abused in the street that somehow they’re to blame. The change of tone has been really important. There’s an opportunity now for a very constructive engagement with the community and I think we might get there. As I say, we offered to be part of today, they’ve made the decision they’ve made, I’m not going to go over the top about it. Ultimately, the people who work every day with these different communities, a whole lot of them are on each side of the Parliament who have been working with these communities for decades and it would be a mistake if Malcolm Turnbull as Prime Minister didn’t say ‘we want your help to’.
GILBERT: You say abused in the street, is there a level of tension in your area between those of the Islamic faith and those that aren’t?
BURKE: Public transport has often been the scene where, in particular, women have received verbal abuse; occasionally physical, often verbal. I’ve often been in circumstances talking to women immediately after, within a day or so of incidences like that, it’s awful. Here’s the challenge: We know the people hurling that sort of racist abuse are not at all representative of us. What we also need to know is the people who are radical and violent are not at all representative of the Islamic community. We need to be able to work together in the most constructive way. Of course there’s a problem and of course the Islamic community is well positioned to play an incredible frontline role in helping to deal with that. We just need to be honest and to never use this as an issue to try to blow up within domestic politics. This is something where a constructive relationship and the sort of thing that could some out of today’s meeting is absolutely in the national interest.
GILBERT: Let’s look at a few other issues including in your area of responsibility as Shadow Finance Minister. The Westpac Bank has decided to hike their rate, their interest rate. What do you say to this? Do you agree with Scott Morrison they’re gouging their customers?
BURKE: I’m not going to disagree with what Scott’s said on that at all. I don’t disagree with him at all on that. I think the great frustration people feel is every time there’s half an excuse for an upward movement on rates, it seems like they always grab it. Yet, when there’s reason for rates to come down, the excuses aren’t taken, the reasons aren’t used. The frustration was really at its worst when, after the cash rate for the Reserve Bank kept going up, the banks matched it exactly. Then when the cash rate was on the way down, the banks didn’t match it exactly. Now again, at the exact same time the Reserve Bank is being very cautious with rates, you’re now seeing ‘half an excuse, let’s grab it’.
GILBERT: Would you urge the other big banks not the follow suit in this case as many analysists and economists think they will?
BURKE: Of course, we’ve seen a pattern with this as to how the big banks often do operate. But we want banks, both with their home loan rates and also the rates, even though they’re not affected by this decision, the rates on credit cards are still extraordinary and haven’t come down the way other rates have. Banks need to be in a situation where, yes they have to run a business, but they don’t need to gouge the customers.
GILBERT: And I guess there’s the advice to shop around as well. There’s a fair bit of competition now in the market, so if people don’t like it they can move?
BURKE: Yeah, there are transaction costs in moving. This isn’t like saying ‘my supermarket is selling tomatoes for too much so I’m going to go across the road.’ This is a situation where, yes you can, yes there is portability, and people should take advantage of that, but let’s not pretend this is a really fluid market where you can just make a decision overnight and say ‘ok I’m going to switch who my mortgage is with.’ It’s a lot more complex than that and there are significant transaction costs.
GILBERT: Let’s finish, if we can, on the Cayman Islands investment, the Government points out that many of your colleagues, including the Opposition Leader, Mr Bowen and Senator Dastyari, their own superfunds would have offshore fund managers that are domiciled in the Cayman Islands. The Prime Minister also points out he has paid full tax on his income in Australia. Probably more because of the way it is structured.
BURKE: First of all, just on that last point, I think it becomes quite a stretch when we start saying ‘oh, paying more tax’ as though this was some sort of act of nobility. If there’s more tax it’s because there’s more profits as a result of these arrangements. So, I think the nobility part we can be put to one side. On the issue of super funds, I think quite simply, every Australian knows there is all the difference in the world between someone taking the automatic default fund in a job, and the fund manager then making decisions, and somebody deliberately signing across that they want their money headquartered in the Cayman Islands, in a tax haven.
GILBERT: His is all offshore, done through international fund managers, he made that decision when he became a minister to avoid any conflicts of interest.
BURKE: My understanding, and this is why we’re asking the questions to get to the bottom of this, we haven’t been making accusations, just asking the questions to get the detail…
GILBERT: So the politics of envy; as he asserts?
BURKE: And of course he would. But he’s not the wealthiest person in the Parliament. We haven’t been going after people based on wealth. The issue here is not how much money he has, the questions that are being asked are whether or not he made a deliberate decision to park money in a tax haven. Now, you say ‘international managed funds,’ from what the register implies, and this is what we’ve been trying to get the bottom of, it doesn’t look like this is just a managed fund internationally that then invested in the Cayman Islands. It looks like this was a deliberate decision for the funding, to choose a fund that was itself headquartered in the Cayman Islands.
GILBERT: But then he’s paid full tax here, so what’s the problem?
BURKE: If the argument is he’s actually paid more tax here, that can only be because using the tax haven meant in the first instance there was great profits coming; that’s the only way logically that can be. You go to the comments by President Obama, with all this, it is a completely legitimate line of questioning for us to ask. We haven’t done what Malcolm Turnbull’s been doing when he’s been throwing mud about trade unions around the chamber, and putting forward information which is factually incorrect.
GILBERT: If he’s paying full tax what’s the problem? What is the fundamental problem. I can’t understand. If there’s an income stream, he’s paying the full tax, what’s wrong with that?
BURKE: Well no, he’s paying the income tax. Whether the fund itself is paying levels of tax is something we don’t know the answers to. The fact that taxation is being paid at one point in the business cycle of this doesn’t answer the whole question. They’re legitimate lines of enquiry and legitimate questions to be asked.
GILBERT: Mr Burke, thanks.
BURKE: It’s good to be back.