PM Transcripts

Transcripts from the Prime Ministers of Australia

Howard, John

Period of Service: 11/03/1996 - 03/12/2007
Release Date:
14/05/1999
Release Type:
Interview
Transcript ID:
11038
Released by:
  • Howard, John Winston
TRANSCRIPT OF THE PRIME MINISTER THE HON JOHN HOWARD MP TELEVISION INTERVIEW WITH KERRY O’BRIEN 7:30 REPORT

Subjects: Senator Harradine's decision

E&OE................................................................................................

JOURNALIST:

John Howard, what happens now.

PRIME MINISTER:

Well we will amend the legislation in the Senate to give effect to

all of the increases in compensation and other changes that I outlined

to Senator Harradine yesterday. We will naturally do everything to

the legislation that I told him yesterday we were going to do. We'll

then put that legislation up and if it's rejected we'll

put it up again. And that's because the Government believes that

this country badly needs taxation reform. We told people all of the

details of our plan before the last election. It's not just a

GST. It includes massive cuts in fuel taxes, it includes a 30% top

marginal rate for 80% of Australian tax payers, it takes $4 billion

off our exporters, $10 billion off business costs, and it's

got $13 billion of personal tax cuts. It's a total revamp of

our system, and we need it. And I believe in it because it's

good for Australia, not because I'm on some ideological kick.

I've got plenty of other things I could be ideological about.

But I really believe that this country will be better and stronger

if we can have a changed tax system.

JOURNALIST:

Was it clear from Senator Harradine's conversation with you today

that not only does he reject this latest package of yours, but that

he is now not open to any further offers, that his mind is made up

against the GST?

PRIME MINISTER:

That was the very clear impression that he gave to me today. I thought

until the last 24 hours that he may have thought that it was more

important to honour the mandate we received at the last election,

particularly as we made full disclosure before the election what we

were going to do, that that would, with a bit of extra compensation,

that that would outweigh his reservations about the character of our

taxation reform. But he decided no.

JOURNALIST:

So once you've put it a second time, if it's rejected a

second time, will you keep open the option of a double dissolution

election on your tax reforms?

PRIME MINISTER:

Well if a bill is rejected a second time after the lapse of three

months it's always open for a government to have a double dissolution.

You'll understand I'm not foreshadowing now when the next

election will be. I don't know when it will be and I would think....

JOURNALIST:

But it's a live option?

PRIME MINISTER:

Well it's always a live option of you have a double dissolution

trigger, yes of course it is. But we don't need another election.

We just had one on the GST and I made full disclosure. I mean I looked

everybody in the eye and said this is what I'll do if I get elected.....

JOURNALIST:

But then you've taken it back to a Senate that wasn't elected

at this election.

PRIME MINISTER:

Oh yeah, but I mean I think that's fairly corny argument. Well

if that is the only objection then the Senate that was elected at

the last election ought to pass it the second time around.

JOURNALIST:

Except that unfortunately for you the same who put you back into government

also put in a Senate that would appear to continue to be hostile to

the GST.

PRIME MINISTER:

But governments are formed in the Lower House and if we're to

have a political process that works then it's got to a possible

for a party that makes full disclosure to get its mandate implemented.

I mean it would be a different matter if I had simply said to the

Australian public if you reelect me I'll cut your personal tax

by 20% and I didn't say anything about the GST until after the

election which is what a certain Mr Keating did in 1993.

JOURNALIST:

It's hardly a screaming mandate if you scramble back by a few

thousand votes and less than 50% of the vote overall.

PRIME MINISTER:

There's an old political saying that if you get 50 plus 1 you

win by a landslide.

JOURNALIST:

You always seemed confident that you'd be able win Senator Harradine

in the end with what you called more than once, fine-tuning. You were

wrong it seems.

PRIME MINISTER:

No, I said I was hopeful, rather than confident. I always thought

it would be difficult but I was hopeful. And we certainly made a very

generous change to the compensation arrangements. The pensioners alone

will get almost $800 million more compensation; 5% instead of 4% increase

in the pension; and in future, if the plan goes through, the pension

will be always 26% of male average weekly earnings instead of 25%.

JOURNALIST:

And yet you never convinced Senator Harradine at any point that you

were able to guarantee that these compensations would last over time,

that they would not be eroded over time, whereas as he said in the

Senate today, the GST is there for good.

PRIME MINISTER:

Well no current Parliament can bind a future Parliament. By the same

token a future Labor government could increase wholesale sales tax.

JOURNALIST:

But you are binding a future government to the GST aren't you?

PRIME MINISTER:

Well a future government can repeal a GST.

JOURNALIST:

Only with the support of the Premiers. I mean you......I'm

sorry, no, that was about increasing it.

PRIME MINISTER:

Yeah that's right. Now they can repeal it. I mean, you've

put a very interesting point, the Labor Party is against the GST yet

when asked Mr Beazley doesn't promise to repeal it if he inherits

it. I mean we are being utterly consistent. I have always believed

in tax reform. Mr Beazley knows that tax reform is needed. The three

Labor leaders I've opposed, Bob Hawke, Paul Keating, and Kim

Beazley, all at some stage have embraced a GST. Mr Beazley is engaging

in political opportunism by doing what he's doing now.

JOURNALIST:

But the person whose vote you really needed, and the person who appeared

to approach this with all sincerity and no kind of political opportunism

was Senator Harradine. Do you accept that he has been sincere in this?

PRIME MINISTER:

Well look, I don't make a judgment about Senator Harradine accept

things that he said to me. He's been honest with me. But it doesn't

alter the fact that..he's not accountable to me. He's accountable

to the Australian people. I mean the Australian people will make a

judgement about him. It's not for me to pass a judgement. I've

always found...

JOURNALIST:

I think you've been respectful of him in the past.

PRIME MINISTER:

Yeah, I've always found him to be an honest person to deal with,

and I've always dealt honestly with him.

JOURNALIST:

He sat through four months of Senate hearings on the GST. He's

obviously agonised for months over this decision and he does appear

to be genuine in this. If you're right and he's wrong, having

listened to all he's listened to as an intelligent man how could

he get it so wrong?

PRIME MINISTER:

Well, I can't answer that Kerry. I can't answer that. In

the end in politics what you do is you put up a program, you seek

electoral support for it and then you hope you can implement it. Now

I did that. I mean nobody could say for a moment that I held anything

back. I mean we hear a lot of criticisms of politicians for being

deceitful and dishonest. On the issue of tax reform I was open, I

was patent, I was sincere, I was transparent. I told it warts and

all before the last election. Now if you can't in those circumstances

get your program implemented, we really are approaching political

gridlock in this country because under the present electoral system

no one side of politics can ever win control of the Senate. So the

only way you can ever hope in a decent sense to get your program implemented

is to spell it out in detail before an election and then say to the

Senate the people knew about it, they returned us and you ought to

pass it.

JOURNALIST:

Senator Harradine made the point also today, and in this he seems

to agree with Labor, that if the system ain't broke why fix it.

And I suppose what he's pointing to, amongst other things, is

that you've brought in a surplus of $5.4 billion in your next

financial year. If you look at future years without the GST you could

be looking at a surplus of $20 billion three years from now. Now how

is that system broke if it can deliver you that kind of surplus?

PRIME MINISTER:

Well it's broke in a number of ways. It doesn't provide

enough funds for the States. One of the great advantages of the GST

is that it will underwrite the essential services of the States. A

tax system is not just about raising revenue. It's also about

making our exporters more competitive. We could be a wealthier more

competitive, more successful society if 80% of our taxpayers paid

only 30 cents in the dollar at the top. If we provide more incentive

we can have a more energetic, more forward-looking community. We are

a vast country. The price of haulage by fuel is still too great in

this country. All of those things can be attended to by taxation reform.

JOURNALIST:

But presumably if you've got a $20 billion surplus to play with

three years from now you can provide a greater largesse in a number

of those areas that you're talking about now.

PRIME MINISTER:

Well Kerry, you can't assume that you'll have all of those

surpluses forever, and after all we are accumulating surpluses now

to pay off the debts that Mr Beazley ran up when he was finance minister.

JOURNALIST:

But $20 billion would look after that.

PRIME MINISTER:

Well hang on, we inherited $90 billion, so we have a lot of debt still

to pay off. And what we would like to do with those surpluses Kerry

is not squander them, but to use them to repay debt.

JOURNALIST:

You've faced the prospect of this defeat for months now. What

is your alternative plan, your fallback plan if you go through the

process of the next three months of being rejected twice in the Senate?

What is your fallback plan for the tax reform that you say you're

going to remain committed to?

PRIME MINISTER:

Well Kerry, I think you should invite me back in 3 months time, and

I promise to appear if that eventuality occurs. I have known from

July 1997, when I resolved that this country needed taxation reform,

that I would have to go through this process. That I would have to

go to the public, telling them everything, laying it out in detail,

running the risk of a fear campaign, running the risk of losing the

election. Facing the inevitability of not controlling the Senate,

knowing that I would have to try and persuade Brian Harradine, and

Mal Colston to support us. I knew that. I've known that for two

years and in that sense I'm prepared for all eventualities. But

that is the only way that you can get tax reform. There is no other

way because that is our system. I mean Kim Beazley 14 years ago believed

in what I now believe in. He supported a broadbased indirect tax in

1985. Bob Hawke did, Paul Keating did. We all know it's needed.

They're playing games. The country deserves better.

JOURNALIST:

John Howard, we're out of time. Thanks for talking with us.

PRIME MINISTER:

Pleasure.

11038