Senator the Hon Mathias Cormann

DAVID SPEERS: Mathias Cormann, thanks for your time.

MATHIAS CORMANN: Good to be here.

DAVID SPEERS: As a senior Cabinet Minister, let me ask you honestly, how do you think the Prime Minister has begun this year politically? 

MATHIAS CORMANN: We have had to deal with some issues. Obviously we would have liked the year to have started better, but we are very confident about 2015. We are very optimistic that 2015 will be a good year for Australia. Our objective is to build on the progress that we have made in 2014 with building a stronger, more prosperous economy, creating more jobs and repairing the Budget. 

DAVID SPEERS: Has that job been made harder by the blunder this week on Prince Philip? 

MATHIAS CORMANN: Well the Prime Minister has taken responsibility for the decision he has made. He has learned his lesson. He has indicated that he will consult more widely in the future. That is a good thing. I think it is now time to move on and to actually focus on the important issues for Australia. That is how do we best deal with the challenges coming our way. How do we best position ourselves to take advantage of the opportunities coming our way.

DAVID SPEERS: I want to talk about some of those. But can I just ask you, that as someone like so many Australians who has come here as a migrant, not from a British background, what does the Royal family actually mean to you? 

MATHIAS CORMANN: I am a very strong supporter of our Constitutional Monarchy. I think it is a system of Government that has proven itself over decades and decades and indeed over hundreds of years around the world. From my point of view, I came to Australia from Belgium, which also has a Constitutional Monarchy as its system of government... interrupted 

DAVID SPEERS: So you see the value in keeping it? 

MATHIAS CORMANN: I absolutely see the value in terms of stability over time and in Australia it has worked very well for us. 

DAVID SPEERS: And what about Peta Credlin? The Prime Minister’s Chief of Staff. Rupert Murdoch says she needs to do the patriotic thing and go. 

MATHIAS CORMANN: I disagree with Rupert Murdoch. You wouldn’t be surprised hearing me say that. Rupert Murdoch is an eminent Australian. He has been extraordinarily successful on the international stage, but on this one I disagree with him. Peta Credlin does an outstanding job. She does a very important job for the Government. It is obviously a very central job in Government, being the Prime Minister’s Chief of Staff and as far as I'm concerned I look forward to working with Peta Credlin in that role for many years to come. 

DAVID SPEERS: Let’s move on to some of the challenges this year. I wanted to ask though, given the Government is starting in a somewhat weakened political state, is the Government going to curl into a ball, adopt a small target, do nothing that is going to be unpopular or will you still be ambitious on some of the things that you want to do? 

MATHIAS CORMANN: We will continue to be ambitious about putting Australia on a stronger foundation for the future. We made significant progress in 2014. In 2014 we were able to scrap the carbon tax, to scrap the mining tax, to reduce red tape costs for business by more than $2 billion, to finalise three key Free Trade Agreements with key economies in the region, China, Japan, South Korea. All of that focused on building a stronger economy and creating more jobs. And we have made significant progress when it comes to Budget repair. Yes there is more work to be done. Yes we face some additional challenges, global economic headwinds, decisions, delays and negotiations in the Senate that didn’t always go our way. We continue to focus on heading in the right direction, making progress, putting Australia on a stronger foundation for the future. 

DAVID SPEERS: You have got this year though the IR review that is underway by the Productivity Commission, you have got a tax review coming up as well. On industrial relations, Tony Shepherd, the Chair of your own Commission of Audit is urging the Government to make the case for change. Will you make the case for change? Is there a case for change? 

MATHIAS CORMANN: It is incumbent on all of us across Australia to participate in the conversation about how we can best improve our workplace relations system into the future, how we can best improve our tax system into the future. At the end of the day, what is our challenge? We need to ensure that as a nation, we are as competitive internationally as possible. 

DAVID SPEERS: So what does that mean for industrial relations? 

MATHIAS CORMANN: Overall what it means is exactly that. We need to be as competitive internationally as possibly. We need to ensure that we continue to bring down the cost of doing business in Australia. We need to ensure that we can continue to strengthen economic growth, generate more jobs so that everyone across Australia has the best possible opportunity to get ahead. 

DAVID SPEERS: So for example, the business community is saying penalty rates on the weekend are the stand out here, you are stopping a lot of small business hiring and opening their doors on a Sunday. Is that something that needs to be fixed?

MATHIAS CORMANN: These are some legitimate issues that need to be talked through. We are obviously not going to pre-empt what the findings of that process are going to be. In the lead up to the next election we will be putting forward our policies for a second term as part of a second term agenda. In the meantime, it is very important that everyone across Australia who has got a contribution to make puts their hand up and expresses their views, puts forward their ideas and their suggestions and the Government will put forward a program to further strengthen Australia into the future in the lead up to the next election.

DAVID SPEERS: Is tax in a similar basket? Will you wait for the outcome of the review and take to the next election any change?

MATHIAS CORMANN: That is exactly right. Our focus with tax is how can we have lower, simpler, fairer taxes. How can we raise the necessary revenue to fund the services of Government in the most efficient, least economically distorting way possible, so that we don’t detract from our economic growth potential, so that we do have the revenue available to ensure that Government can provide the services that it needs to provide.

DAVID SPEERS: Can we afford to wait another couple of years?

MATHIAS CORMANN: It is not as if we are standing still and not doing anything. What we are doing this term is implementing the commitments that we took to the last election and that has already included the removal of the carbon tax which has helped put downward pressure on inflation, which has helped reduce the cost of electricity, which has helped reduce the cost of living for families, which has helped reduce the cost of doing business. We have already got rid of the mining tax, which has helped in terms of attracting investment in what is a very important industry for our economic future. We are rolling out our first term agenda, we are working now on setting the foundation for our second term agenda through those various processes that I have mentioned.

DAVID SPEERS: Right now though you are well into the work on the second Budget for the Government, you are receiving submissions already, today the peak welfare group ACOSS have given you a list of ideas, amongst them entirely scrapping the private health insurance rebate. All up their ideas would save $13 billion a year. Are any of them attractive?

MATHIAS CORMANN: We will consider the submissions put forward by everyone, from all organisations across Australia. In relation to health what I would say is that the policy challenge for any Government at a Federal level is how best to ensure that all Australians can have affordable and timely access to quality healthcare in a way that is also affordable for the taxpayer over the medium to long term. What we know here in Australia is that the best way to achieve that is to have both a strong public and a strong private health system. Some years ago, private health insurance membership was in freefall and the private health insurance rebate was a very important policy lever to restore that balance. From the Coalition’s point of view, the private health insurance rebate is something that we continue to be very strongly supportive of. 

DAVID SPEERS: So you don’t want to strip that from anyone else?

MATHIAS CORMANN: We remain strongly supportive of the private health insurance rebate as a very important policy reform in the Howard Government years, which has significantly helped to restore the balance between private and public health. That was very much getting out of whack before then. 

DAVID SPEERS: And a final question on public health, I suppose. Can you spell out for me, what is the Government’s position on the GP co-payment, on Medicare itself?

MATHIAS CORMANN: The Government’s position is that we want to strengthen and protect Medicare for the long term. We want to ensure that vulnerable patients, pensioners, concession card holders and the like, continue to have access to bulk billing, but that those of us who can afford to pay more do pay a small proportion when we access relevant medical services. We think that is an important reform. It is about providing a value signal as Health Minister Sussan Ley has said earlier today. 

DAVID SPEERS: Could that be through means testing bulk billing?

MATHIAS CORMANN: Currently the Health Minister is conducting consultations with the AMA and other stakeholders. We will have some more to say about that in coming months and no doubt there will be something in relation to all of this in the Budget. The important point here is that health expenditure and in particular expenditure on medical services has been growing faster than the economy and faster than inflation for some time. It is projected to continue to grow faster than the economy and inflation for some time to come. We need to do something in order to get funding for medical services on a sustainable trajectory for the future. 

DAVID SPEERS: So the new position will be announced in the Budget?

MATHIAS CORMANN: Obviously there’s only one aspect of the whole package to strengthen Medicare which has been taken off the table. Everything else remains on the table and Health Minister Ley is currently consulting with all stakeholders to come up with the best way forward.

DAVID SPEERS: Finance Minister Mathias Cormann thanks for your time. 

MATHIAS CORMANN: Always good to talk to you.