Subjects: September Quarter CPI; Peter Reith mobile phone; Badgery's Creek Airport; Charles Perkins State Funeral; QLD ALP electoral inquiry
E&OE................................
JOURNALIST:
Prime Minister, the CPI figure 6.1. You'd be pleased?
PRIME MINISTER:
We always knew that it was going to kick up this quarter because of the one off impact of the GST but this increase is lower than everybody expected. And that is very good news. It means that the first big post July 1 hurdle has now been cleared. We have a Business Activity Statement to come in November and we'll be following that very closely. But this really is good news because it's lower than everybody expected and that has to be positive in relation to long-term conditions for things like interest rates and so forth. And overall it shows that the new tax system has been absorbed. It's not had as big an impact as people expected. If you look through the figures you will see that there are some significant falls. A big fall in childcare costs - 15%. A big fall in fresh food costs. These are the things we said would come down, as well as other things going up. So I have to say, on the basis of these figures, that the GST has been bedded down even better than the Government had hoped and I think it's a very good outcome.
JOURNALIST:
Were you expecting higher figures?
PRIME MINISTER:
Our forecast, our Treasury forecast was a GST impact of three and three quarters. According to these figures the GST impact is below three so that is much better than we'd been advised.
JOURNALIST:
So it wasn't the bogey that everyone expected?
PRIME MINISTER:
Well people never thought it was going to be a bogey. Everyone knew there was going to be a big increase this quarter because that is the automatic result of the introduction of a broad-based indirect tax. But what has happened is that the increase has not been as great as the Treasury thought, as private sector economists thought, indeed as everybody thought. And that is good news. It means that the compensation for pensioners is, in relative terms, better than we said it was. It means that the justification for wage increases to compensate for the GST is even less. They've been fully compensated by the tax cuts. On top of that the price rises have not been as great. So all round it adds to the Government's conviction that the new tax system has been smoothly introduced. It's impact has been beneficial to the Australian economy and generally speaking it is a good outcome for the Australian community.
JOURNALIST:
Will it be hard to sell though given that the figures are the worst in a decade?
PRIME MINISTER:
Not when you realise that they were always going to be quote the worst in a decade because of the one-off impact of the GST. And you can't introduce a broad-based indirect tax without having a quarter in which the price effect is greater than normal. The questions you've got to ask are whether that price effect is greater or as great as you expected and the answer is it was less than we expected and whether the underlying rate of inflation is a problem. Now if you take out, put aside the GST, you knew there was going to be a one-off impact, and you take out the increase in the price of petrol driven by an almost 50% increase in the world price of oil in US dollar terms, you have a very low underlying inflation rate. That in the long run is the driver of the long term inflationary outlook.
JOURNALIST:
Prime Minister, Senator Faulkner has called for you to sack Mr Reith this morning on the basis that your Ministerial Code has been breached, that it's beyond reasonable usage of the phone now that his wife's become embroiled.
PRIME MINISTER:
Well you'd expect Senator Faulkner to say that. Of course you would. Oppositions always say that. This thing really has lost proportion. Mr Reith's usage of his mobile phone has been completely in accordance with the guidelines. Now it's as simple as that.
JOURNALIST:
Do the guidelines need changing though? Do they need .
PRIME MINISTER:
I don't believe they do. I mean, you've got to remember that busy and senior politicians on either side - it's often very much a partnership with their wife or their husband. I think we're losing a sense of proportion.
JOURNALIST:
But where's the accountability? They can give the phone to whoever they want.
PRIME MINISTER:
There's no suggestion that he's given it to anybody. His wife is not anybody. His wife is not anybody. I mean to suggest that because her voice may be on the phone that he's giving the phone to anybody is insulting. I think we're losing sight of the fact that senior politicians, whether they're Labor or Liberal, have got to travel around the country.
JOURNALIST:
Is that the (inaudible) taxpayers .
PRIME MINISTER:
I think it is reasonable that a Minister be provided with the sort of facilities that Ministers are provided with. They are very busy. And can I say that the Leader of the Opposition is provided with the same facilities. The Opposition Leader has more facilities and a higher salary than just about any Minister. I know because I've been an Opposition Leader.
JOURNALIST:
Does he give his mobile phone to his .
PRIME MINISTER:
I don't know what he does. I make no allegations about Mr Beazley. I assume that Mr Beazley uses his entitlements correctly as has Mr Reith in relation to his mobile phone. Mr Reith hasn't broken the rules in relation to the mobile phone. He hasn't. And they are rules that were put in place by the former Government.
JOURNALIST:
But you don't see a need to .
PRIME MINISTER:
I don't see a need to alter those rules. No, I don't. I think we are getting this whole thing out of proportion. I couldn't do my job properly without the understanding and the assistance of my wife and I'm sure that's been the case with previous Prime Ministers and Ministers on both sides of politics. I know it might make juicy copy.
JOURNALIST:
But doesn't that imply you could give that phone to anybody?
PRIME MINISTER:
Well the reality is there's no suggestion he has. And I .
JOURNALIST:
Could have.
PRIME MINISTER:
When you say could have, I mean I could do a silly thing, you could do a silly thing. It's a question of whether you do. And if you write rules on the basis that somebody might do something, you never give them any facilities at all and that is plainly ridiculous. We cannot have a situation where people demand that busy Ministers be regularly traversing a very big country, understandably wanting to be in touch with their families, having their wife or husband beside them on occasions to help them, doing all of those things effectively and then saying, oh but you can't have these facilities because you might give it to somebody you shouldn't. You can't run a system like that. But I repeat, in relation to Mr Reith and his mobile phone, he has not broken the rules. He has not given it to anybody. His wife is not anybody. His wife is his wife and she's been a political partner for Peter Reith for a long time. I really do think that this part of matters relating to Mr Reith has got completely out of proportion.
JOURNALIST:
Does Mrs Howard have access to your phone?
PRIME MINISTER:
Well I don't have a mobile phone as it happens. If I need a mobile phone I borrow one from my staff. But that's not through any particular economy measure, it's just that I don't need it.
JOURNALIST:
Do you get frustrated by the extent of this story? It just doesn't seem to want to go away.
PRIME MINISTER:
Well I learnt a long time ago not to get frustrated in politics. I do believe that this latest stuff on the mobile phone is absurd. I think it is out of proportion. It's a measure of the fact that there's nothing new on the telecard issue so in order to keep it alive some people are dredging up these things in the hope that that will keep in going.
JOURNALIST:
Doesn't it demonstrate an attitude towards the use of a taxpayer funded phone?
PRIME MINISTER:
No, I don't think it does. I don't think you understand the extent to which husbands and wives of senior politicians share many of the burdens. I couldn't do my job without my wife's understanding and involvement. I couldn't. I would be less than adequate to the task. I think you're missing the point of all of that. Peter's been a Member of Parliament through all of the time that his family's been growing up and Julie's been part of it. I think the fact that she may have answered his phone or used it or whatever, completely in accordance might I emphasise with the rules, I think to say that that indicates some kind of contemptuous attitude of mind, I think that's wrong. I think you misunderstand the nature of the responsibilities that wives and husbands carry. Any person who has a responsible job, if their wife or husband is heavily involved with them, even if they have their own separate careers, it is a partnership and I just think that we're losing a sense of proportion about this.
The telecard thing, there were different aspects of that. He did break the rules in making that available. He's paying for that. He's paying to the tune of $50,000 so that the taxpayer is not out of pocket. But he didn't break the rules on this occasion. His wife is a close partner in his political career. She's very important to him in relation to that as well as being his wife, as my wife is to me and as indeed Labor senior politicians. They're in the same situation. I'm not saying this is peculiar to us. I just think we've got to get a sense of proportion about this. Otherwise we'll have a situation where you're frightened to sort of do anything for fear of being attacked for abuse of priviliges.
JOURNALIST:
Now that Badgery's Creek is off the agenda, what's the alternative site?
PRIME MINISTER:
Well there's been no decision taken on Badgery's Creek as yet. It was discussed yesterday at some length and we're having a further discussion again in the next couple of weeks. Badgery's Creek raises a lot of difficult issues and we're looking at all of those and you can't take a decision on Badgery's Creek without also looking at the whole question of. all the other questions.
JOURNALIST:
Have you looked at an alternative site.
PRIME MINISTER:
An alternative site. Well, we've looked at a whole lot of alternatives in relation to Badgery's Creek.
JOURNALIST:
But you're not willing to write off Badgery's Creek yet?
PRIME MINISTER:
We haven't made any decision, final decision yet, let me put it that way.
JOURNALIST:
Are you expecting backlash in your seat? Your seat's one of those affected by .
PRIME MINISTER:
Expecting backlash against what? We haven't taken a decision yet. You're asking me to hypothesise and I'm not going to do that until we've made a decision and then I'm not hypothesising.
JOURNALIST:
But a lot of the inner city councils and protest groups .
PRIME MINISTER:
This is one of these issues that no matter what decision you take you're going to upset somebody. We're certainly not going to walk away from the commitments we've made in relation to the curfew and we're certainly not going to create a situation where people are unfairly treated. It's just a very difficult issue.
JOURNALIST:
Well how far down the track is it going to be before it .
PRIME MINISTER:
We'll be taking a decision before the end of the year. I said that some weeks ago and that remains the position.
JOURNALIST:
There were some questions in Sydney today why you didn't attend the Charles Perkins state funeral. Is there any reason you didn't bother to turn up down there?
PRIME MINISTER:
Well I had long standing commitments in Queensland. I've come up here for a number of functions. That's the reason I didn't think it appropriate to - I'd made a commitment to attend a community gathering in Beenleigh that a thousand people attended. I made that commitment some weeks ago and I didn't think it was appropriate for me to break that commitment. Senator Herron is representing the Government at the memorial gathering and that's appropriate.
JOURNALIST:
Prime Minister the ALP rorts inquiry here in Queensland. It will be ..
PRIME MINISTER:
It's more than a rort, an inquiry into a rort. It arose as a result of fraud and illegality. This is not a trifling branch stacking dispute. This is the real McCoy. This is breaking the law to achieve electoral advantage, political advantage. It's quite different from the sort of traditional ALP bunfight over who gets the pre-selection.
JOURNALIST:
Well that's what the Premiers saying - it's the factions at work and a few individuals.
PRIME MINISTER:
Well I've got a couple of things to say about the factions. If he'd have been worth his salt he'd have done something about the factions himself. The people who have responsibilities in relation to factions in a political party are leaders. You either hammer out an understanding between them or you do something about their power. But we're not talking here about an ordinary internal party stoush. This is not a row over who's got the numbers: the right; left; or the centre. This comes out of fraud, of illegal criminal conduct. It's quite different. It's qualitatively different from, say, the argument over who's got the numbers in a preselection. That sort of thing goes on a lot. You're talking here about names being improperly and illegally put on electoral rolls. Now that's fraud.
JOURNALIST:
Do you think it is isolated to Queensland?
PRIME MINISTER:
Well I'm following what's happening with great fascination and interest. I'll deal with the facts as they arise. And the facts as they've arisen indicate very clearly that you're talking here not just about an ordinary rort or ordinary branch stacking. You're talking here about illegality.
JOURNALIST:
Have the Liberals got a clean slate on this front?
PRIME MINISTER:
Absolutely in relation to illegality. Absolutely. Who's suggesting there's any illegal conduct by the Liberal Party in relation to electoral rolls? I'm certainly not aware of that.
JOURNALIST:
How much do you think this could cost Peter Beattie at the ballot box?
PRIME MINISTER:
Look I don't know, it depends on what comes out. But you're talking here about something that is qualitatively different from just an internal party fight. It can't be trivialised as being oh well this is the sort of thing that always happens. It's not the sort of thing that always happens. You don't always send people to jail and you don't always have allegations that names have been illegally put on electoral rolls. Now that's very different from a branch bunfight.
(Ends)