HOST: I'm joined now by the Prime Minister from Canberra.
Julia Gillard, starting with the WikiLeaks exposure of Kevin Rudd's comments on China to Hillary Clinton when he was Prime Minister, in particular his advice that the US should be prepared to use force against China if all else failed, what is the risk that those comments will harm Australia's relationship with China?
PM: Kerry, I don't want to disappoint you in what will be my last interview on your show, but I am not going to comment on the details of leaked cables that are making an appearance on WikiLeaks.
What, of course, I will talk about is our relationship with China, and we have a strong relationship with China, a constructive relationship, but also a frank relationship where we can say things that are in our national interest, that express our views and opinions. Expressing our views and opinions, being frank, doesn't hurt the relationship. You can have a frank discussion. We have in the past and we will in the future in the context of a strong and constructive relationship.
HOST: Well, of course I wasn't going to ask you to confirm what was in the cable, but we can all take our own judgments on that and all those other cables that have been released and the various political leaders' reactions to them, but just on the reports and what has been exposed, it could hardly be helpful to the relationship for Chinese leaders to be reading that an alleged friend and important trading partner in the region was privately telling the world's most powerful nation to be ready to use force against them if necessary. Now, how do you know that the Chinese won't privately take offence at that, even if they don't come to you and say, 'You've hurt us'?
PM: Kerry, I'm not going to assume accuracy in the cables. We're not commenting on the contents of these cables.
HOST: No, no, I understand that.
PM: What I can say about our relationship with China is I think everybody knew that WikiLeaks was going to put a lot of information out there. Everybody's been expecting that. I don't anticipate these reports will make any difference at all in our relationship with China.
HOST: But, nonetheless, there are realities and the term 'brutal realism' was used about Kevin Rudd's approach to Australia's global diplomacy. Every nation has its national security, every nation has its armed forces, every nation has its security strategies. You must be covering these issues in your discussions with various countries in the region, but particularly with the United States. What is the circumstance in which force would be justified against China?
PM: Kerry, our outlook on China is something that's been in the public domain. We've had an opportunity to talk about it at length recently, partly because I've been at important meetings like the East Asia Summit; partly because when Hillary Clinton and Secretary of Defense Gates were here in Australia for the annual Australia-US Strategic Dialogue, our AUSMIN dialogue. Inevitably, the rise of China was something under discussion.
Our settings here, Kerry, are that a prosperous China engaged in regional institutions like the East Asia Summit is an important force for good. We want to see a prosperous China. We want to see China engaged in a rules-based system. We want to see them engaged in regional architecture like the East Asia Summit.
We also believe the US plays a stabilising force in our region, which is why we were so pleased to see the US step forward and join the East Asia Summit. We believe there will always be differences between countries. We'll have differences with China and they are resolved through diplomacy and dialogue.
Of course, as a country, we make proper provision for our national interest, including our defence interest. You'd expect a national government to do that and we do.
HOST: And when you talk about encouraging China to be a part of regional and global forums that it hasn't previously been a part of, is that a part of a process of ultimately containing China?
PM: The rise of China, of course, has got everybody thinking, 'How does this new giant fit in with regional stability, with global stability, with diplomatic architecture, with security dialogue, with trade dialogue?' Of course, everybody has been talking about the rise of China, but we are very clear on how we are going to work bilaterally through our strong, constructive, frank relationship with China, through regional-
HOST: -But does the word containment feature in your vocabulary?
PM: Engagement is the word in my vocabulary, Kerry - engagement in regional forums like the East Asia Summit where we do have now around the table China, the US, countries of our region, engaged in a dialogue across the economic, the strategic, security matters. These are good things and that's what we want to see as China increases to be a force in our region and in our world.
HOST: Can we talk now about what could be a make-or-break year for you next year, in the context of what has been a horror year for Labor in 2010.
Firstly, do you agree with me that there is a real hunger in the community for inspired leadership and a sense that they're not getting it - yet - from you?
PM: I think our community wants to see the vision of the future. They want leaders to put that before them and they want to know that you're working towards it, and Kerry, as Prime Minister, I am doing that and I'll continue to do it.
I think people have underestimated the sheer size and scope of our reform agenda. We are drawing on our heritage as a Labor Party, the threads through Hawke and Keating, our reformist tradition. Kerry, some of the things that they did were nation-changing, but they could only be done once. You can only float the dollar once, for example.
We are now getting on with the reform work that is necessary for parts of our economy which are important to people's day-to-day lives, but haven't had transformative reforms for, you know, over a generation. I'm talking about health, I'm talking about education, about water, and of course, the newer challenge of pricing carbon. We're bringing our market-based tools to this change.
HOST: But we have been hearing that framework of policy challenge since before you came to power in 2007. When you talked about people being surprised or not fully understanding the scope of the reform agenda, do you think you yourselves did not understand what you were taking on, coming in in 2007, that perhaps you took on too much with what you were promising?
PM: We came to government in 2007 with a wave of enthusiasm for change. A long-term government was being replaced. I said on election night, sitting with you, Kerry, that I thought people still had a sense of connection and respect for Prime Minister Howard, but they did want change and our government set about delivering change.
I think we did a lot of things very quickly and there were times that we didn't explain the full importance of our reforms to the Australian people, and then on top of what was a very broad reform agenda, we had to handle the global financial crisis, and, Kerry, I'm proud of our response to the global financial crisis. I'm proud of how the country responded. Because we responded that way, since 2007 to now, we can talk about 650,000 jobs being created - Australians in work, with pay packets, with dignity, with self-worth as a result of those policies.
But we do keep- I do need to keep explaining the vision of the future and I'm going to do that now and in 2011.
HOST: But when you talk about the vision for the future, so much of your agenda for next year - and I've read very carefully through your various outlines of that, and there have been a few - and so much of that agenda seems to be coming from a defensive base: digging your way out of the mess that the new mining tax became; trying to recover credibility on climate change; trying to take the heat out of the asylum seeker issue. Even on the economy, everything's framed by your overall imperative to climb out of deficit. This is not an inspirational agenda on the face of it, is it?
PM: Kerry, I'm going to disagree with you. I think we do have an agenda to inspire.
I was inspired to become involved in public life in politics because I had a vision, a care, a concern about the circumstances of every child getting a great education. That's part of what we're doing in 2011, taking more steps to making that dream come true - every child a great education.
And then when I look at health - nothing more important to Australians when they or their families are under pressure than knowing that they can see a doctor, they can see a nurse, they can get a hospital bed. Well, we will be making our health reforms real next year and we'll be transforming our health system for the decades to come.
HOST: But let me just stop you right there. Health reform - so people will be able to do these things next year. This reform agenda is going to kick in next year. So by the end of next year, you will be able, or the public will be able, to look at very real outcomes on your health reform agenda and I'm not just talking about pockets here and there. You're saying that by the end of year '11, we will be able to see broadly across this country evidence of where your health reform policies have bitten?
PM: Change is happening now, Kerry, and people will see more change in 2011.
To take just some examples of the change, we've driven thousands more elective surgeries through our hospitals, and just last week I was in Queensland announcing some good news with some more money for more elective surgery. Now, for Australians that have been on waiting lists, this is incredibly important, part of our health reforms. More doctors, more nurses - part of our health reforms. Local hospital networks, you'll be able to see their boundaries - part of our health reforms. Medicare locals, bringing together the important primary care services that help people when they first become unwell or to manage a chronic condition in the community - people will be able to see those taking shape.
Kerry, health reform and its delivery is going to take some time. Making a new doctor or a nurse takes some time-
HOST: -Yes, but this is the point-
PM: -I'm not going to resile from that-
HOST: -But that's point I'm making-
PM: -But delivering, piece by piece, transformative change is necessary for our health system. Kerry, we come off-
HOST: -Sorry, that is the point I'm making: that in so many of these things, these are very slow building blocks. As I say, people are hungry to get a sense, a real sense, of your leadership, but this agenda is still Kevin Rudd's agenda, isn't it? I look at your agenda outline for 2011 and I still see Kevin Rudd's agenda. When can we begin to define the substance of Julia Gillard's leadership; to see the stamp that says Gillard on this Government?
PM: Kerry, on the day I became Prime Minister, I said to the Australian people I'd believed all of my life in some basic principles that had guided me. I said I believed in the benefits and dignity of work, and I have signalled that in 2011, you will see changes. What we will call, in the language of politicians and policy-makers, participation changes, but changes to make sure that more Australians enjoy the benefits and dignity of work - having a job.
I was driven into public life by my belief in the transformative power of education. It changed my life. I wouldn't be sitting here being interviewed by Kerry O'Brien if it wasn't for the transformative power of education. We will continue to drive that agenda - something that quintessentially, Kerry, I've stood for every day I've been in Parliament. And I believe-
HOST: -But I've heard you, I have heard you outline these things many times, many times-
PM: -Well, you've asked me for my agenda, Kerry, and I'm outlining it for you, and of course-
HOST: -Well, you're outlining a vision that you first outlined quite a long time ago, but the bottom line is people, it seems, are still struggling to be convinced about your leadership. That jury would still seem to be out, and I would think you'd agree with that, but you've had plenty of time to reflect on what went wrong for Labor in the last term, particularly the raising of expectations, that probably you as a Government, Kevin Rudd as leader, were never going to be able to meet in the time, certainly not within one term, with or without a global crisis. What part do you think that the Government's media strategy played in what became a nightmare third year - and you've touched on this briefly in the past. I'm just interested to hear about what you regard as the challenges of a new media environment for Government today?
PM: Well, Kerry, I'm happy to talk about that and in part I think our last exchange may exhibit a little bit of it to people. I was talking to you about the things I first said on the day that I became Prime Minister, about the dignity of work, about education, about my confidence in the future of this country and our ability to deal with so many difficult issues, like pricing carbon, like reforming health, like rolling out the infrastructure of the future, the National Broadband Network.
Now, I talked about my passion, my vision about those things in June. Here we sit in December, and Kerry, you don't make that kind of change in six months. You can start it, you can deliver bits of it, but you need to methodically keep delivering. And that's what I will be doing in 2011. And in the media-
HOST: -But in that context- yeah, go on.
PM: In the media environment, we constantly are under pressure to say, well, what's new? What's different? As if the journey in health reform or the journey in pricing carbon or the journey in making sure every child gets a great education or more Australians have the benefits and dignity of work, that that journey is somehow over the first day that a reporter types up what I've said in the first press conference. Of course, real reform isn't made that way.
HOST: But isn't it also true that the Rudd Government set itself up for this, because almost daily it was like there had to be a new headline, there had to be a new policy announcement? Even if there wasn't a new policy to announce, there was old policy dressed up as new. It was as if there had to be a regular feeding of the media beast, because if you didn't somebody else would. Now, I know that's something that you've become concerned about. I just wonder how you are going to change this Government's approach to its relations with media while still hopefully being open?
PM: I'll certainly be open, Kerry, and I accept the responsibility as Prime Minister to say to the nation where I want us to head to, what the vision is, and how we're going to do it. That's my responsibility.
The new media environment, I think, puts some new challenges in my way in acquitting that responsibility, but ultimately I'm going to keep persisting, and, Kerry, what it is about is it's about saying, as I did to the press gallery when they gathered with me for a Christmas drink at the end of the parliamentary year, you can really think about this like Australians think about a Christmas stocking: there are a few things that people will give each other this Christmas that are meant to last and have meaning for a lifetime - that first watch you give your child, the first locket you give your daughter, that you want them to have for 20 or 30 years - and there are the things that are stocking fillers that you know will be broken in 24 hours' time, or lost, or fully consumed in 24 hours' time.
In the public policy area, I'm more interested in the things like that watch or that locket that will still have meaning in 20 years than the things that are forgotten about tomorrow. That is going to require me to keep having that conversation with journalists, with our Australian media, but I'm going to keep doing that. and Kerry, if, in 12 months' time, whoever is sitting in your chair says to me, 'don't tell me you're still going on about education; don't tell me you're still going on about everybody having the benefits and dignity of work; don't tell me you're still going on about tackling climate change,' I'll count that as a success, because that means that for 12 months-
HOST: -I think they'll probably be asking asking you about the realities.
PM: -for 12 months we would've been talking about those deep reforms.
HOST: Julia Gillard, thanks very much for talking with us. Thank you.
PM: And if I'm allowed a moment of nostalgia, Kerry - fantastic to be able to be here for your last week and I'm sad to see you go. I'm sure there will be moments that I won't miss a tough Kerry O'Brien interview, but you've made a fantastic contribution to the Australian national debate and our sense of ourselves.
HOST: Thank you for that. Goodnight.
PM: Thank you.