TRANSCRIPT
Television Interview: Alex Malley, Andrew Geoghegan
ABC News24
Monday 20th July 2015
Subjects: GST Reform, NSW Premier Baird, CPA Australia Research
ANDREW GEOGHEGAN: Alex Malley is the Chief Executive of CPA Australia. He joins us now. Alex, good
to see you.
ALEX MALLEY: Good morning.
ANDREW GEOGHEGAN: You've just heard the Labor leader there in Victoria saying he's not going to
support it. The Prime Minister has been on the record saying before that the only way that GST could be
increased is if there's consensus. It doesn't appear to be forthcoming does it?
ALEX MALLEY: Look it's an interesting day of politics yet again. We've been pushing the GST argument
for some time. All of the federal tax reviews are being delayed. So I think the feds have found that they've
hit a wall. Nothing is going to happen. Mike Baird has got very good political credibility. He's take tough
issues to the electorate and won, and I think there's been a conversation that's said perhaps let's try and
get the states to lead the way. But that comment from Daniel Andrews sort of reminds us of the challenge.
ANDREW GEOGHEGAN: Do you feel the only way forward then, if for instance the GST as Mike Baird
proposed was increased to 15 per cent or perhaps even broadened, the only way to do that would be to
take it to the next federal election?
ALEX MALLEY: Well I think people need to look at the issue, but they need to look at it cleanly. We did
some numbers on this some time back and all of the key politicians have these numbers. So to just give
you a quick number, if they were to go to 15 per cent without increasing the base, or broadening the base,
there'd be $110 billion in four years of which you could give 20 to 25 per cent back into welfare support and
reduce or eliminate state taxes. I think the big issue here is really about trusting politicians, not the analysis
in the case because the case is pretty compelling.
ANDREW GEOGHEGAN: You talk about therefore increasing welfare payments. That's part of the issue
isn't it? That Mike Baird has recognised that some sort of compensation would have to be given to families,
for instance households under $100,000 a year …
ALEX MALLEY: Correct.
ANDREW GEOGHEGAN: … would need some form of compensation if prices across the board were to
rise to 15 per cent.
ALEX MALLEY: That's right, and that is achievable. And we've done a sensitivity analysis of broadening
the base and not broadening the base. So what Mike Baird is talking about today we've got the numbers.
And all of the key politicians were sent those numbers. So 30 per cent of 180 billion, if they broadened the
base, would go back into welfare support. And imagine a world where you had no insurances, no motor
vehicle stamp duties and no conveyancing. So I think most decent people would listen to that and say let
me look at the case. The problem I've got is I'm not sure I trust the politicians. And Mike Baird has got
credibility; I think he's going to go for it. Jay Weatherill has been talking about some interesting changes in
tax in South Australia. So we need some courage here because our economy is going backwards, our
unemployment rate is growing and we've got to call it out.
ANDREW GEOGHEGAN: Rather than increasing it to 15 per cent, for instance, what effect would simply
broadening the base have?
ALEX MALLEY: Well, we've done analysis on that as well, and that would certainly increase the revenue
position on coming into the economy. The problem with that is that we've got a lot of people moving into
retirement so the tax receipts are dropping markedly. We've got a problem, we've got a structural problem.
And I think Mike Baird's comment today about saying we could just kick the can down the street and leave
it to the next generation … you know, I've got seven children, I'm compelling company in the family and I
have to tell you that I think about them, and I worry about the next generation inheriting the mess and the
lack of leadership we're seeing on both sides of Federal Government today.
ANDREW GEOGHEGAN: You're clearly frustrated from the point where you stand because, I mean, doeseveryone recognises that the current revenue situation is unsustainable particularly when, for instance, we
talk about healthcare. Another example that I think you cite was means testing of public education, which
was thrown out immediately when that discussion came up. Are you saying all these things need to be on
the table because we have to a find a way of raising revenue?
ALEX MALLEY: I think context helps you make decisions. So if you put everything on the table to start with
and work backwards and find a sweet spot if possible, it's your best chance to negotiate anything in your
life, whether it's at private or public level.
When you have got premiers who have promised something in an election campaign, and because we've
made promises such a big deal in politics these days, and they're saying we're not going to entertain it the
day before they're going to meet, I think that's a problem for the country. And I think to change your mind
because there's a compelling case is a very different political story to saying I've made a promise and by
hook or by crook I'm not going to change it. It's an immature position. And I think Australia has been
supported by its belief that it's going to continue to kick along very well because Europe and the US broke,
we didn't. We didn't for a whole lot of reasons called mining, called a whole lot of things.
If you look at our unemployment stats, a lot of people unemployed at a full-time level, they're employed a
couple of days a week. And we're calling that employment? So the interest rates, people talking about
interest rates every day, it's a pulse rate, Andrew, it's a pulse rate and there's no pulse in this economy.
ANDREW GEOGHEGAN: You're saying then there's a lack of political courage?
ALEX MALLEY: Absolutely. Positively, both sides. At the moment federally we've got a popularity contest
with the leaders. We got to talk about helicopters to political events, and we're now talking in the press in
the last couple of days, if we can believe that, potential tax cuts leading into the next election. So we are
now in the cycle of let me throw some opportunities for you because there's an election coming. We've lost
another cycle. And the Government has not kept to its dateline on tax reviews, and we have to keep
pushing this. I think Mike Baird's making an attempt, and for that I think good on him. But I'll also going to
suggest this morning that Mike Fanning - Mick Fanning I beg your pardon, has got to retire. I think his luck's
out.
ANDREW GEOGHEGAN: [Laughs] I think he'll be seriously considering it. Sharks in the water both here
and there.
ALEX MALLEY: Absolutely.
ANDREW GEOGHEGAN: Alex Malley from CPA Australia, thanks very much.
ALEX MALLEY: Pleasure Andrew.
ENDS