PM: Can I welcome Prime Minister John Key here to Canberra and we're very much looking forward to having him address the nation's Parliament later today. When I became Prime Minister I was very determined that the relationship between Australia and New Zealand should continue to go from strength to strength. We're like family and I suppose the temptation is with those closest to you that you take their bond with you for granted instead of continuing to nurture it; I'm sure many of us have experience that in our own lives.
I was concerned we were taking some of our relationship for granted, we had not maintained the annual exchanges between leaders that we should have and so I determined that we would put that back in place and was very pleased to accept Prime Minister Key's invitation to visit New Zealand earlier this year and to have the historic opportunity to address their Parliament.
In the ordinary course of things Prime Minister Key would have been in Australia next year for the annual exchange, but of course the fury of nature caused us to think again. When we experienced our natural disasters here in Australia, New Zealand boots were very quickly on the ground to give us a helping hand. And when New Zealand faced the shock of the earthquake in Christchurch, Australians were there almost immediately to provide a helping hand. And given what our friends in New Zealand have been through with Christchurch, the aftershocks, the distress that is still there, I believed it appropriate to ask Prime Minister Key to visit us now and to address the Parliament today and I thank him for accepting that invitation.
In the lead up to his Parliamentary address we've had the opportunity to talk about the important connections between our countries. When I spoke to the New Zealand Parliament I said we had to remain active and engaged on reforming our economies, on uniting our two countries across the Tasman, and reaching out beyond our two nations together to the world. We've taken some steps on each of those during the course of our discussions; on reforming our economies we've agreed to establish a single Australia-New Zealand Therapeutic Products Agency, it's another step forward in the closer economic integration of our two economies. We've also determined keep working on the Smart Gate system which is the technology which would enable travelling between Australian and New Zealand to feel like a domestic flight experience. In terms of uniting ourselves across the Tasman, we've determined that we will have officials work together on linking our emissions trading schemes - of course New Zealand prices carbon, has an emissions trading scheme which is working successfully; New Zealand's in front, we will catch up, we'll show the same determination they have and we will have officials working together on linking the two schemes.
On working together to have our voices heard in the world and to deal with global problems, New Zealand is hosting the Pacific Island Forum a little bit later this year, very closely associated with the World Cup, about which we're anticipating a very major difference of opinion, but we will be going into the Pacific Island Forum together with a united view about working in a spirit of friendship and partnership across the Pacific. We will of course see events in our region later this year, the East Asia Summit, APEC, and of course the Commonwealth Heads of Government Meeting here in Perth later in the year, and we continue to share the work in Afghanistan, as we are committed so New Zealand is committed to seeing the mission through in Afghanistan.
Finally I'd like to conclude by saying we've discussed a very special centenary which is coming up, the word ANZAC defines so much about both our nations and of course the centenary of Gallipoli and where the ANZAC legend was born is coming upon us, we need to make appropriate preparations now for 2015. Here in Australia we will shortly be forming an advisory board to guide the commemorations of the centenary of Gallipoli. We will want to work with New Zealand as we put those events together and have its advisory structures work with us so that some of these commemorations happen in each nation but some of these commemorations happen together as the word ANZAC properly implies they should.
And I am pleased to announce today that design work will commence soon for an Australian memorial in the proposed New Zealand Memorial Park in Wellington and we've begun to work together to plan for the Gallipoli Dawn Service in 2015.
So with those words of opening about our discussion and with a genuine spirit of welcome, I'll turn to Prime Minister Key for some remarks. Thank you.
PRIME MINISTER KEY: Julia thanks very much and firstly can I just say how wonderful it is to be here in Australia. Julia, I want to thank to thank you actually for your commitment and your warmth to the relationship between New Zealand and Australia. It's a very genuine commitment and our two countries are in stronger shape because of it. It's a real honour to have the privilege of being the first New Zealand Prime Minister to speak in the Australian Parliament; it's a great opportunity for New Zealand to put on the record the relationship with Australia, the strengths and the opportunities that lie before both countries.
I think it is entirely fitting that the first international Prime Minister's speech in our Parliament came from Australia and Julia I think you gave a stunning speech in our Parliament, you set the bench pretty high but we'll see if we can replicate this afternoon, but it was a real expression of the warmth and the family that is Australia and New Zealand, so I appreciate that and it was great for you to come over.
I do want to express my gratitude to the people of Australia for the way that they responded to the disasters that we've had in New Zealand, obviously the Pike River mine disaster last year, the two earthquakes that have taken place. It was extremely comforting to have not only the financial support of the people of Australia but actually their technical expertise and their good will and to feel that New Zealand wasn't isolated on its own as we were dealing with some of the worst natural disasters we've ever had was very encouraging and I'm very grateful for that.
Just to give you a sense of the magnitude of those earthquakes and the impact they've had on our economy, on our estimates this is the single biggest impact of any natural disaster on a developed economy that we can find, it's going to cost in the order of 8 to 9 per cent of GDP, around about $25 billion, so it's a very major event. It's had a huge impact on the confidence of the people of Christchurch, we've had approximately 7500 aftershocks with a magnitude of three or above since the 4th of September. So it's had a big impact.
But the country is coming together well, the government's totally committed to the rebuild of Christchurch and we believe that will occur. We've fully provisioned in budget 2011 for the earthquake costs, it's about $5.5 billion over and above the insurance and reinsurance that we had. So we're doing our best to go forward.
Can I also say how delighted I am that we've managed to sign today the Australia-New Zealand Therapeutics Agency, the work that our officials will undertake over the next five years, it's yet another step in the progress of CER between our two countries.
We are working very hard to try and make sure that we put some practical and sensible deliverables for the people of Australia and New Zealand as a result of our work. Smart Gate is a great example of that, a million and a quarter Australians will come to New Zealand every year, having a domestic like experience is a real benefit for them and equally it's true of the hundreds of thousands of New Zealanders that come across the Tasman. If we can make progress of roaming charges of communications for instance, again it's a practical deduction in costs for citizens of both countries and I think that's what our voters want to see, they want to see us actually making progress in things that really matter to them.
So we thank you for that. In terms of the Pacific Forum as Prime Minister noted we'll be hosting it from the 6th to the 9th of September; that's the fortieth Pacific Forum. New Zealand and Australia remain totally committed in our approach towards Fiji and wanting to see democracy restored to Fiji as fast as we possibly can. We do appreciate your commitment Julia to building a memorial in New Zealand at our national war memorial and the Government's looking at its own response there as well.
And finally just in the relation to the Rugby World Cup, as you're aware that is the third largest sporting event in the world, we're very much looking forward to hosting a Cup. All the indications are that with the way it could do it could well be (inaudible) Australia and New Zealand final. We have been thinking about what could be a possible bet for the relevant, Prime Minister one option we were thinking that maybe the Prime Minister of the losing country has to eat an apple from the other country. I would say let's say 60 seconds describing the merits and the benefits of that apple and why it's such a pleasurable and enjoyable experience. So that is an interesting challenge and all I can say is I hope the All Blacks don't lose.
PM: That's certainly spurred the spirit of Australian determination on. Now we'll take questions from media from each country. I think in the spirit of welcoming our New Zealand friends we should probably ask a New Zealand journalist first, I'll let you pick, John, and I'm happy to give a form guide to ours when it's their turn.
PRIME MINISTER KEY: Sure, Barry Soper from Newstalk ZB and Prime News.
JOURNALIST: Prime Minister Gillard I'm just wondering when you look at New Zealand and the way we've introduced our emissions trading scheme with some envy given the problems that you're facing in this country, for one - he's riding high in opinion polls and you're not?
PM: Well thank you for that question and I would say to the people of Australia as we're standing here talking about all things New Zealand, we love Kiwis, they're family for us, but I think Australians would be asking themselves if the Kiwis have had the guts to go and price carbon, why can't we? Well my answer is we can, we can catch up with our Kiwi friends.
JOURNALIST: Prime Minister on a separate theme-
PM: I should just introduce, this is Andrew Probyn from our West Australian newspaper, so he'll probably ask you something about resources? No.
JOURNALIST: It's actually on the carbon price and I'd like to get a response from the two of you. Mr Key your nation has introduced an ETS, you've got the last stock price for carbon is about $19.50 which cruelly because of the Australian dollar is about A$15. What are the merits of having a low price, as opposed to a high price before there is a global agreement. And Prime Minister would you also like to comment on whether there is merit to having a lower price rather than the higher one.
PRIME MINISTER KEY: Let me start by saying it's not for me to determine what's the right approach for Australia, that's a matter for Australian politicians, but what I can tell you about the emissions trading scheme in New Zealand is it's worked, so that's the first point. In the time that we've had it in place, all of the applications for new electricity generation has been in the renewable space, so as opposed to about 50/50 coming from thermal energy, that price signal (inaudible) sending a strong message that renewable energy makes sense.
Secondly, we are seeing a change in behaviour when it comes to forestry. So, we've now had a period of aforestation, of planting more trees, as opposed to what had been a substantial period of deforestation. So those price signals are working in the marketplace.
Specifically to your point about costs, I think we're all conscious of the impact on consumers. By pricing ours with a cap at NZ$12.50, about A$10 at the moment, then we anticipated we'd have an impact of about $150 per household per year. We're about a year on in terms of the anniversary of that and the indications are that it's coming in at about $150 a year.
We've got a review taking place in terms of when the next move is because our scheme should (inaudible) up to $25 carbon charge by about 2013. It's a little bit early to tell you completely about that review, although one thing I can say is that generally speaking the feedback we're getting from businesses and the NGO sector is that they are more positive now that the scheme is actually in place, because they are confident it gives them surety of investment and we are just obviously conscious of what's happening around the world, including what happens in Australia.
JOURNALIST: Prime Minister, would you like to see your scheme become a single scheme with Australia? You're talk of linkages, do you see a sole market?
PRIME MINISTER KEY: When we came into office there was an original scheme on the books passed by the previous Labor Government. That was a much more expensive and quite intensive scheme that we thought had some design flaws and we largely actually picked up the CPRS scheme that you are proposing over here so it has an (inaudible) that allows companies to grow and it arguably does make sense for there to be interoperability and to be able to trade emissions across the Tasman. Again, that is something our officials are working on, but you know our two economies are so closely related my view as New Zealand Prime Minister has always been I wouldn't want to see investment decisions moving across the Tasman, one way or the other, frankly based on climate change policy , it would seem to defeat what is a global problem.
JOURNALIST: Prime Minister Gillard, it was fitting for you to be the first leader to address our Parliament, Prime Minister Key is the eighth to address this Parliament, why has it taken so long?
PM: I think it's the right time for a New Zealand Prime Minister, Prime Minister Key to address our Parliament. It is a rare honour to be invited to address the Australian Parliament, it is not routine, it's not the norm. We have had people like President Clinton, we've had Prime Minister Blair, President Hu, President Yudhoyono, amongst others, address our Parliament, but it is a rare honour.
I think it's more important this year than any other time to extend that rare honour to the Prime Minister of New Zealand. I think our sense of family and the bonds between us were sharply reinforced this year in a time of great suffering, initially in our nation and then we turned our eyes to New Zealand, as we saw the horror of Christchurch, so it gives us a moment to reflect on those events, to reflect on how we jointly responded to them together and to talk about the future.
JOURNALIST: Prime Minister Key our Opposition Leader Phil Goff has said that Gerry Brownlee's fobbing off Christchurch business and questions if he's up to the job. Do you think it's his fault that he's not (inaudible)?
PRIME MINISTER KEY: Well I don't think Phil Goff is in a position to make those kind of statements. What I can tell you is that we are trying to deliver the best possible outcome for the people of Christchurch that are so badly affected by that earthquake. Now as I said last week back in New Zealand, we are getting much closer to identifying the land that needs to be abandoned.
We understand completely the anxiety that's creating for those residents but the single most important thing we can do for them is give them clarity and to give them clarity we need to be able to answer all of the questions, not just whether they can rebuild or not on their plot of land, but ultimately what their payouts is in terms of the insurance companies and how that process might work, what actually happens next in terms of their existing property.
What we do know is that there is in the order of about 12,000 homes in this category of being either likely to be demolished, and some of that land will be able to be rebuilt, and some will not. I really think in the interests of everyone for us to hold our breaths and for us to get through and get the people of Christchurch a finished product if we possibly can.
The officials and my ministers have been working over the weekend. I will be meeting and obviously on Tuesday when I get back we will be closer to coming up with a solution. But all I can say is that if we were to follow the approach that Phil Goff was talking about, we would end up in a position where we would be asking potentially those 12,000 homeowners to negotiate individually with both EQC and a their own insurers and I, for the life of me, cannot see how that would be a better outcome for the people of Christchurch.
JOURNALIST: Prime Minister Key, in the context of the interoperability that you said the officials were working on with the emissions trading scheme, what do you make of the Coalition's promise to roll back the carbon price and Prime Minister Gillard, why not a plebiscite?
PRIME MINISTER KEY: Well, in terms of your question, it's simply just not for me to determine what is the right approach for Australia and we acknowledge that every country has a different profile in terms of their emissions and different response.
At the end of the day, our two economies are very closely linked and if we can work together on this problem of climate change then I think that's a good thing. We already are working very closely together on the international market in terms of the Global Greenhouse Gas Alliance and the Coalition, what we are doing there in terms of the coal storage institute. We see that as a sensible way forward, but we leave that in the hands of the Australian politicians.
PM: And in answer to your question to me, I mean this is an $80 million stunt from Tony Abbott, that's all it is. It's not leadership, leadership requires you to define the problems of the future and to get about tackling them and that's what we're doing.
JOURNALIST: Prime Minister Key, on Fiji, the Australian Opposition says that five years of sanctions and attempting to isolate the regime hasn't pushed Fiji any closer towards democracy. Do you think that New Zealand should reassess its approach and perhaps reengage more closely with the regime?
PRIME MINISTER KEY: Look, I think the first thing is we need to acknowledge that there has been a coup culture that has developed in Fiji. Now it's been in place for the last 20 years, we've had four of them. For a country the size of Fiji and its significance in the Pacific, we don't think that it's in the long term interests of the Pacific.
So in our view we do need to make sure that there is pressure on Fiji to restore the country to democracy. I don't think in the case of either Australia or New Zealand we've taken a terribly heavy handed approach here, from New Zealand's perspective we simply had travel sanctions on members of the regime and family members that are closely related to them.
We haven't applied economic sanctions; we for the most part do give waivers in terms of sporting contact and the like. So in my view we are slowly making progress and these things always take some time. Frank Bainimarama has given a clear commitment that he intends to hold elections by 2014 and from New Zealand's perspective we expect him to honour that.
JOURNALIST: Animals Australia says it gave Joe Ludwig the footage last year of Australian animals being mistreated in Kuwait. Did your Government receive it and do you think the response has been adequate and Prime Minister Key, given New Zealand's experience on this issue, do you think Australia does have anything to fear if it did go down banning live exports?
PM: I haven't had the opportunity this morning to see the footage you refer to obviously I've been engaged with Prime Minister Key in discussions. What I understand to be the case is that Minister Ludwig was alerted to footage of this nature last December. Minister Ludwig responded on animal welfare issues by saying to the industry in January that they needed to produce a better animal welfare plan. He received a response from them in March, which was inadequate. He received a response from them in May, which was still inadequate. Since then, of course, we saw the revelations on Four Corners and the Government has responded with the suspension of the trade to Indonesia and we are now taking the steps necessary to make sure we can track where Australian animals go and we know the conditions under which they are being dealt with in abattoirs in Indonesia.
We've also announced, of course, a more broadly based review, the Farmer Review, which will look at the entirety of this trade- all animals, all locations. But I will of course, when I get an opportunity, specifically direct my attention to this new footage. I'd want to understand exactly when it dates from and the circumstances that are there today before providing you with any further response.
PRIME MINISTER KEY: Look, it's a matter for the Australian Government in how they want to respond to the issue. All I can say is that New Zealand decided to stop the live export of animals for slaughter in 2003. It does cause some frustration to our Middle Eastern trading partners but the decision is unlikely to be reversed.