Subjects: tax reform, GST, private health insurance rebate.
E&OE..........................................................................................
SALLY SARA:
Mr Howard why should Kim Beazley have to make his promises now when it
was only two weeks before the last election when you spelt out the detail
of your entire tax package?
PRIME MINISTER:
Sally all this started when Mr Beazley made a promise to the state Labor
leaders. The great weakness in Mr Beazleys' position is that he says
I can't say this about income tax, I can't say that about the
health insurance rebate but I can promise the state Labor leaders that
the roll back of the GST won't leave the states with less money.
In other words he allowed himself to be bullied by Mr Bracks, Mr Beattie
and Mr Bacon down in Burnie and he has only got himself to blame because
you can't promise to roll back the GST, guarantee the states they
will be no worse off, keep the budget in balance and not in some way lift
income tax. It's just impossible and Mr Beazley has now become the
victim of his own strategy of being all things to all men. He has tried
to quieten down interest groups criticising aspects of the GST, then he
has turned around and promised the state Labor leaders there will be no
problem for them. And now he is saying look don't ask me to go into
detail about anything else it's too far out from the next election.
Well if it was too far out from the next election in relation to the deficit
and all these other things, why wasn't it too far out from the next
election in relation to the promise on the roll back. Mr Beazley will
have no alternative but to lift income tax if he is to roll back the GST
and leave the states no worse off.
SALLY SARA:
Mr Howard on the issue of the health insurance rebate. Can you promise
at this stage that that is an initiative the Government is planning to
keep forever? Isn't that a short term measure?
PRIME MINISTER:
No, it's not a short term measure. We have always believed in it.
Always. And it's a very good measure. And I challenge Mr Beazley
this morning to guarantee to the 32 percent of Australians who have private
health insurance, many of them retired people, many of them self-funded
retirees, many of them pensioners who regard private health insurance
as a very important area of comfort for them if they get sick and they
welcome that rebate. And can I just point out to your listeners Sally
that taking away the private health insurance rebate is a tax increase,
because it's a tax rebate. And because after the first of July 80
percent of Australian tax payers will be on a top marginal rate of no
more than thirty cents in the dollar, which is the value of the rebate,
it would represent taking away full tax deductibility of private health
insurance for 80 percent of the people who now have it. Now that is a
tax increase however you describe it and I have no doubt that people like
Jenny Macklin and others inside the Labor party are very keen on the idea
of axing it. They have never believed in it because they don't believe
in private provision for health. They have bled the private health insurances
dry when they were in office, even Graham Richardson appealed to them
to stop the haemorrhaging when he was Health Minister but they ran it
down and we have patiently built it up and we are very proud of what we
have done and for the first time in a decade, you are seeing a turn around,
you are actually seeing people going back into private health insurance.
SALLY SARA:
Mr Howard, lets get back to this key issue of what is being ruled in
and ruled out. Are we getting into dangerous territory here? Yesterday
you were asked whether there would be additional tax cuts, post the first
of July and you said after the first of July that's something the
Government will consider the situation. Aren't you left open to questions
too about whether things are being ruled in or out.
PRIME MINISTER:
Not at all Sally. We went to the last election with a plan. We went through
a lot of political pain to win that election. We were courageous enough
to lay out all our plans. The popular bits, the not so popular bits. The
people re-elected us. You know what happens after the first of July the
average Australian family will get a tax cut, a personal tax cut of forty-seven
dollars a week after allowing for the GST. Forty-seven dollars a week.
Now that is what happens after the first of July and it's the value
of that tax cut which is at risk as a result of Mr Beazley's conduct
over the last few days if the Labor Government were to be elected. Now
that is what happens after the first of July. I mean we have had the courage
to lay out a plan. We've been criticised for taking on what is something
that you know you can easily run a scare campaign about. But we believe
that tax reform was good in the long-term interest of Australia.
SALLY SARA:
But you layed out that plan two weeks prior to the election. Kim Beazley
is what eighteen months out from an election. Why should he have to spell
out the detail now?
PRIME MINISTER:
Sally, he started it. He was the one who spelt out the detail to the
Labor Premiers in Burnie. I mean he was the person who was bullied by
them into undertaking not to leave the states any worse off. In other
words he knew enough about the budget in two years time to give that promise.
But he is now pretending to you and the rest of the Australian community
that he doesn't know enough about the budget situation to give a
commitment about the private health insurance rebate. Now you can't
have it both ways. You can't say I know enough about the economic
situation of the country to guarantee the states they will be no worse
off but I don't know enough about the economic situation of the country
to guarantee there will be no lift in income tax. I mean he is cornered
by his own weakness. If he had not been bullied then maybe the situation
would have been different. But having said that the states will be no
worse off as a result of the roll back then he has no alternative but
to go the extra distance and answer all the questions that are now being
raised because he cant have it both ways. You cant say on the one hand
I know nothing about the budget therefore I can't give any undertakings.
But then say to the Labor premiers oh don't worry you will be all
right. I mean it just is absolutely unacceptable and he has displayed
monumental weakness on this.
SALLY SARA:
Mr Howard thanks for joining us this morning.
[ends]