Subjects: Collapse of HIH Insurance & One.Tel; GDP figures; Federal election
E&OE................................
LIEBMANN:
Prime Minister, good morning to you.
PRIME MINISTER:
Good morning, Steve.
LIEBMANN:
I want to come to those GDP figures in a moment. But can I begin by asking you what message you think recent events, the collapse of HIH and One.Tel and the actions of some of our high profile members of the corporate world and members of the legal profession, who haven't paid taxes for years, what message do you think that's sending to the next generation of Australians?
PRIME MINISTER:
Well, the first thing I'd say, Steve, is that the great bulk of the high profile members of our business community are honest, effective, decent, committed Australians who do the right thing. And you always get a lot of publicity when some go bad but the great bulk of businessmen I know are committed to the future of this country, they pay their taxes and they do the right thing. I think the examples we have are appalling examples and everybody should pay their tax. I'm a believer that people should earn as much as they're worth, make high profits but trade and behave ethically and pay their fair share of tax. And I think when you get examples of people who don't pay their fair share of tax, of course it sends an appalling example, and that description I would apply unhesitatingly to anybody that it fits.
LIEBMANN:
Do you think, though, that there are some members of our business community who need to re-examine their business morals and ethics?
PRIME MINISTER:
There are some but there are some members of every section of the community that deserve to do that. Everybody, every sector of society has people who are freeloaders and who behave in a less than ethical fashion. But I don't want the poor behaviour of some to besmirch the reputation of the many because the great bulk of men and women in Australian business are decent, ethical people who believe in the capitalist free enterprise system but also believe they have social obligations.
LIEBMANN:
All right, to the economy - do you share the Treasurer's view that the economy is now roaring back, roaring back, and that we've come through the GST's transitional stage with, quote: flying colours?
PRIME MINISTER:
Well, I certainly do. I've used exactly the same words myself. I think we have roared back. I think the message out of yesterday's figures is that all this talk from the Labor Party about the GST having mugged the economy is completely wrong. The biggest single growth area in the figures yesterday was services and yet services is the sector of the economy to which an indirect tax was first applied with the introduction of the GST. So if the GST were going to mug the economy, that part of the economy it would have mugged most would have been the services sector. The Labor Party hoped the economy would fall in a heap when the GST was introduced. Beazley told his caucus in December, the year before last, that they would surf into victory off the back of public discontent about the GST. We did the heavy lifting, we took the political risk, we did something that was of long-term benefit to Australia's future. The Labor Party hoped it had all been a failure. Now the Australian people have got more sense than to be duped by that. They've been confident, they've invested in the country's future and I thank them. Yesterday's result is a magnificent result for the Australian people, not for the Government, for the Australian people, because it demonstrates the capacity of the men and women of Australia to embrace reform and carry on regardless.
LIEBMANN:
But if you walked into your local supermarket, say this morning, and you spoke to shoppers and you asked how they were travelling, do you think that they would tell you that they are better off and that the economy is robust? If you asked that question of the pensioners who are going to protest outside your city office this morning, do you think they'd share that view and say, yeah, there's no recession, we're travelling well?
PRIME MINISTER:
I'd get a mixed reaction but you always do. Of course I'd get a mixed reaction. Some people would feel they're better off, some people would feel they're worse off. But what we've had in the last three months, we've had a determined attempt off the back of those one-off, that one-off downturn in December, we've had a determined attempt from the Labor Party to talk the economy down. And it has been echoed in many sections of our media over that three-month period. And if you keep reading every day that things are crook in Tallarook you're going to start believing it and we've had too much of that and we shouldn't have. I mean, we've got to believe in ourselves and believe in our economic future and our capacity as a nation to absorb change and to carry on and look beyond that change. I mean, we're now in the post GST phase of the economic debate in Australia. The GST has come, there were some transitional difficulties, we're responding to those but, by and large, it is now being put behind us and we're going on to the next issue.
LIEBMANN:
Prime Minister, one of the reasons, though, those numbers were favourable yesterday was because Australians are spending and we're spending a lot of money, we're going into debt at a faster rate, are you concerned about that?
PRIME MINISTER:
But as a nation, as far as the Government's budget is concerned, we are in fact paying back debt. We will have paid back 58 out of the $96 billion of debt we inherited. One of the reasons consumers are spending, Steve, is they've got $12 billion of personal tax cuts. And those personal tax cuts were brought in on the 1st of July last year, they are still being enjoyed and still being used. People have got lower interest rates.
LIEBMANN:
We're not saving as much, though.
PRIME MINISTER:
Yes but, Steve, our public savings are stronger because we are no longer in deficit. We have run five successive surplus budgets. We've paid off 58 of the $96 billion of debt Mr Beazley left us. We've got our interest rates down from levels of 17% some years ago under Labor to the lowest, I think, in 30 years. I mean, $300 a month cheaper is the average mortgage in Australia compared with 1996. People have got more confidence than the Labor Party hoped they would have and some sections of the media allowed them to have.
LIEBMANN:
I mean, today, we're only, according to the Sydney Morning Herald and the Melbourne Age and Simon Crean for that matter, today we're only saving 70 cents in every $100 we earn.
PRIME MINISTER:
Yes but, Steve, look at the aggregates. I mean, you've got public savings and private savings and the two together are the aggregate of national savings. Now, obviously if you're running budget surpluses then the level of private savings is less relevant. I mean, if you were running budget deficits and you were also dissaving privately then you would have an aggregate problem.
LIEBMANN:
All right, can I come to the HIH collapse, only in as much as, when are you going to publicly announce the Royal Commission, its terms of reference and who's going to head it up?
PRIME MINISTER:
Well, when we have all of those details settled. The Attorney-General and I are still talking about and discussing with certain people who might be on the Commission. We need to get the right person. It's not easy to find but we are discussing a number.talking to a number of people about it and I said I hoped that I'd be able to do it in a couple of weeks and I made that comment a few days ago. The terms of reference we have by and large settled but I would like to be able to announce the terms of reference and the personnel on the Commission. Bear in mind, this could take a while and you have to detach somebody either from the bench or from the upper reaches of the bar and say to them, well you're going to be doing something else with your professional life for the next year or 18 months. But we are giving a lot of attention to it and as soon as we've got the right person or persons and we're set to go I'll make the announcement.
LIEBMANN:
But can you assure the Australian people this morning that when that announcement comes the terms of reference will be broad enough to establish once and for all what went wrong and who committed what?
PRIME MINISTER:
Yes, absolutely. I mean, have a look at them when they come out. Look, Steve, the Government has a strong interest on behalf of the Australian public to find out what happened and we have nothing to hide, nothing at all to hide.
LIEBMANN:
Will it look at the role of the Australian Securities and Investments Commission because it seems to me it's been pretty tardy, pretty slack?
PRIME MINISTER:
Well, I haven't heard that ASIC has been so much accused of that. But look, I don't want to get into judgements because I don't think that's fair on the bodies concerned and I'm not possessed of all of the facts. But I can assure you and your viewers that the Royal Commission will be able to look at the company, it will be able to look at the role of the regulators, both State and Federal and, indeed, any other matter it thinks relevant.
LIEBMANN:
Okay, final question - Peter Reith has apparently told a newspaper in his electorate that the election will be the first Saturday in December, has he let the cat out of the bag?
PRIME MINISTER:
Well, I don't know. I don't know when it is.
LIEBMANN:
Oh, come on.
PRIME MINISTER:
No, I don't. Look, Steve, my current intention is to have it towards the end of the year. Now, there's a whole range of dates that fall within that.
LIEBMANN:
And in the light of yesterday's numbers you're not rethinking your election strategies.
PRIME MINISTER:
No. My current intention remains to have it towards the end of the year.
LIEBMANN:
Prime Minister, thanks for your time.
PRIME MINISTER:
It's always a pleasure.
LIEBMANN:
Thank you.
[ends]