Labor will honour Coalition contracts despite submarine fury, Chris Bowen says
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Version 0 of 1. Chris Bowen has stressed that a future Labor government will honour contracts signed by the Coalition, following indications by his leader Bill Shorten that the party could tear up any deal with Japan to supply submarines to Australia. The shadow treasurer said Labor would honour contracts in government “even if we don’t like them”. Shorten has mounted a ferocious campaign this week based on reports that the Coalition would go back on a pre-election commitment and buy 12 submarines from Japan, rather than have them made in South Australia. The Labor leader has called the Japanese submarines “home brand” and said the offshore move would cost jobs and endanger national security. He said he didn’t think “future governments automatically have to be bound to every mistake of the current government”. But Bowen knocked back the suggestion that Labor would renege on the Japan deal should it win government at the next election. “This is likely to be a very long-term contract, 40 years or so, and I dare say the government will change a few times over that 40 years, one way or another,” he said following a speech at the National Press Club. “There will be various points where governments can look at jobs contracted in Australia and value for money. “But Bill Shorten and I are of one mind – Labor honours contracts entered into by previous governments, even if we don’t like them. For issues of sovereign risk, Labor honours contracts when in office.” Bowen also said he was not in favour of changing the GST, either by broadening it or decreasing it and raising the corporate tax rate. “Changing the GST would be regressive, it would require compensation for low-income earners and once you compensate them for its regressive nature, there’s not much left,” he said. “We don’t support increasing the GST or broadening its base.” Bowen’s speech was largely based upon a proposal to expand the role of the Parliamentary Budget Office (PBO), to avoid political interference with economic forecasts. Under a Labor government, the PBO would prepare all macroeconomic forecasts that underpinned the budget and would provide an annual structural budget balance, Bowen said. Accusing the treasurer, Joe Hockey, of “manipulating the books” to suit a political agenda, Bowen said the budget process needed more transparency. “Annual reports of the structural deficit may not always be convenient for governments,” he said. “But the Australian people deserve to know the true state of the budget, free from spin and manipulation. This initiative will deliver a much greater and desirable level of transparency when it comes to the state of the budget.” |