MURRAY:
Good morning Prime Minister.
PRIME MINISTER:
Good morning Paul.
MURRAY:
Prime Minister, how do you think your Budget's been received?
PRIME MINISTER:
Well I'll leave that to the public. With these budgets you lay down what you think is a good economic plan. This economy is doing very well, we're performing more strongly than most, we've got the Budget in surplus, we've repaid $66 billion of debt that we inherited, we've made more provision for health and education and defence and security and there's a tax cut into the bargain. Now our philosophy is that when your economy is running well and providing you can keep the budget in balance and you've provided money for the necessaries to run the country and to keep it secure, anything that's left over, whether it's small or large should be given back to the Australian people because after all it's their money, it's not our money. Sometimes governments and prime ministers talk as if it's their money, it's not, it's your money, I'm addressing that comment to your listeners. And I take the view that if there's anything left over you're far better at, saying again directly to the listeners, you are far better judges of how you spend that money than I am, I have no right to say my idea of spending it is better than yours.
MURRAY:
Prime Minister, I heard you say that on the day after the Budget, and I was thinking it through, inherent in that idea is that there are no areas of unmet need then after you've allocated your areas of priority spending?
PRIME MINISTER:
Well Paul there's always be debate according to what view you have. I mean we make a judgment that the public doesn't mind paying taxes providing their money is spent wisely, there'll always be debate about what wise spending and there'll always be some people say you're spending too much in that area or too much in another area and in the end we have to make a judgement of what are the priority areas. Now we've made that judgment, that doesn't mean to say that you couldn't find some individual areas where there mightn't be a case now but we've tried very hard and we think we've made additional provisions for a lot of things. There are additional funds in this Budget for disability support, particularly in the area of employment services, there is additional money for education, very big package for higher education, there's additional money to support Medicare, there's additional money going into defence, there's additional money going into other kinds of security and having done all of that and having provided for a surplus which is sustainable. You can't run the surplus too close to the line otherwise it might go through the floor, we had some over and we provided that by way of a tax cut.
MURRAY:
Well I'll give you two areas of unmet need we've talked about in this programme, the hospitals all around Australia are clogged up with aged care patients who are in public hospitals because the states will tell you the Commonwealth isn't funding enough aged care beds. Why wouldn't you put the...
PRIME MINISTER:
Well I'm sorry Paul, the argument that there are clogs in the public hospitals because of a backlog of people who should be in aged care, that is not sustainable. That's all part of the argument from the states that they don't get enough money from us for public hospitals. I announced four weeks ago that we would increase Federal Government funding for public hospitals run by the states over the next five years by 17 per cent in real terms, that's 17 per cent over and above the rate of inflation. That's a $10 billion increase, provided the states match that increase. Even if they don't increase it, agree to match it, we're willing to maintain...
MURRAY:
Do you think the states have got the capacity to do that?
PRIME MINISTER:
Of course they've got the capacity to do that, I mean apart from anything else as the years go by they get more and more money out of the GST. State Premiers never acknowledge that all of the GST, all of it, goes to the states, all of it. And as it grows, and it will grow as the years go by, they will have more and more money and what I find quite outrageous is that over the last five years, looking at things nationally it varies a little bit from state to state but only a little bit, we have increased our funding to their public hospitals, which we don't own, we don't run, we don't control, we don't direct in any way, we have increased in our funding while the states have reduced theirs. And now they have the gall to say well we can't do this, we can't do that because the Federal Government doesn't give us enough money. But the whole idea of the GST was to end this nonsense, the whole idea of the GST as we say to the states, right-o Premiers, you've got an argument, you don't have a growth tax, we'll give you a growth tax, we'll give you the GST, you can have all of the GST and as the years go by and more and more money will be collected under the GST and therefore you'll have more money to fund public hospitals, police, roads, all of the basic things that in a Federation the states are meant to provide.
MURRAY:
... matching funds on those things they then (inaudible)...
PRIME MINISTER:
How can they have limited revenue when they've got the growth source of the GST?
MURRAY:
Yes, but you're asking them for asking matching funds they can't take that from the GST as I understand it...
PRIME MINISTER:
Yes they can.
MURRAY:
... they've got to take it from their own revenue.
PRIME MINISTER:
No, no look sorry, they have money out of the GST. We don't use the GST to pay for our contribution to public hospitals, we provide for that out of our other revenue sources. All of the GST, every last dollar of the GST goes to the states and every time you hear a state education minister say they haven't got enough money you say to him well what have you done with the GST? You hear a state health minister say I haven't got enough money, what are you doing with the GST? We don't get any of that revenue, it all goes to the states, that was the philosophy because I got sick of going to Premiers' conferences both as a Treasurer and as a Prime Minister and this endless argument about who does what in a Federation, I think it drives the public mad. The public just wants good outcomes no matter who delivers it and there's nothing worse in a Federation than this constant sort of buck passing so what we said is we will make a break from the past and we will give the states a growth tax. The Western Australian Premiers, from both sides of politics, Charlie Court used to say it, I want a growth tax. I've had Labor Premiers say it, Brian Burke used to say it and no doubt Geoff Gallop says it. Now they all signed up, I mean admittedly Richard Court was the Premier of Western Australia when we bought the GST in but the Labor Premiers like Peter Beattie and Bob Carr, I mean they bagged it but they couldn't get to the table quick enough to pick up the pen and sign the agreement because they're going to be better off, I mean Queensland is already better off under the GST than it would have been under the old arrangement and as time goes by each state will be better off. Now that means that they have a greater source of revenue, courtesy of our GST. I mean it's effectively as far as the delivery of the proceeds are concerned the GST is a state tax because it goes to them.
MURRAY:
... propositions to the Premier when he was sitting in that very chair on Tuesday, he said that Western Australia doesn't get its fair share of the GST til 2007.
PRIME MINISTER:
Yes, but Western Australia, when you say fair share of the GST, Western Australia begins to be much better off under the GST in 2007 but in the meantime it is guaranteed the funds that it would have got under the old revenue sharing arrangement of the Keating Government so it's not in any way short changed until 2007. It's just that by 2007 every state will be better of under the GST, that's the point I'm making. Some of them are better off now, but in the meantime those that are not better off, they are no worse off because they have the guaranteed real per capita revenue increase that was given to them by the Keating Government.
MURRAY:
Prime Minister, just put to you a proposition about the tax cuts. My view on the tax cuts is they were a political strategy designed a) to put Labor on the back foot over its demands for tax cuts and what it might be able to do with the money that was in the surplus, and to deflect the attention away from some nasties in the Budget and even though there was increased spending on Medicare and on education there's also those political nasties in that.
PRIME MINISTER:
(inaudible)?
MURRAY:
Well like the idea that you would increase places for domestic fee paying students in universities...
PRIME MINISTER:
So apparently it's alright for foreign students to buy a place in an Australian university but it's not alright for an Aussie young bloke or woman to buy a place in an Australian university?
MURRAY:
And also the...
PRIME MINISTER:
Well that's the Labor Party's philosophy, it's alright for foreigners to buy places in Australian universities but it's not alright for kids who can't get in and who are willing to take out a loan.
MURRAY:
On the domestic children it allows them to jump over...
PRIME MINISTER:
No, no I'm sorry Paul it doesn't allow them to jump over anybody. The HECS funded places are still there, I mean the way the Labor Party's been misrepresenting this you would think that the number of HECS funded, or Government funded, or supported places has been reduced so you could have more full fee paying places, that's not the case at all. What they're allowing, what we're allowing is an increase in the number of full fee paying places but we are also increasing our support for the HECS funded places. And all we are doing is recognising the simple proposition that it's okay for a young person from Britain or Indonesia or Japan to buy a place in an Australian university, why isn't it alright for a kid from Balcatta or from Bankstown or Broadmeadows to do the same thing?
MURRAY:
More likely from Dalkeith or Peppermint Grove.
PRIME MINISTER:
Well you shouldn't assume that, you shouldn't assume that Paul because there are plenty of examples of people who take part time jobs and who borrow in order to get a university education, it used to be the case years ago when fees were paid and it remains the case today. And the other point I'd make is you'd talk about comparisons between Balcatta and Peppermint Grove and Dalkeith, under the existing HECS funding arrangements there is no difference between them, there is no particular advantage given to people who come from poorer socio-economic areas.
MURRAY:
The other nasty that I was referring to in education is the ability for universities to raise their fees by 30%, which many people think will allow the Ivy League-type universities to be able to get those fees but not the other universities thereby creating two real classes of universities in Australia.
PRIME MINISTER:
We have a bit of a dilemma here. On the one hand we want world class universities which we must have yet on the other hand we're not willing to give individual university administrations the authority and the flexibility in order to achieve world competitiveness and unless you free universities from the shackles of federal bureaucratic uniformity, you're not going to have the aspiration of Australian Oxford or Yales or Cambridges. I mean to a large extent our universities are world class, certainly a number of them are, but we want them to be even better and by giving them greater flexibility we are going to achieve that.
MURRAY:
On the Medicare changes Prime Minister, Simon Crean last night said that by spending $1.9 billion he could increase Medicare bulk-billing rates to 80%. Is that a desirable outcome?
PRIME MINISTER:
Well, I think you have to recognise that nobody can guarantee any particular rate of bulk billing because we can't compel, nor should we, doctors to bulk-bill. I mean nobody can guarantee a level of bulk billing. I can't...
MURRAY:
You're trying to incentivate (inaudible) to bulk-bill.
PRIME MINISTER:
Well, one of the interesting things out of the Medicare package from Mr Crean last night is that the whole centrepiece of his package is to give incentives to doctors to bulk-bill but that is also the centrepiece of our package and yet he says he's saving Medicare yet we're destroying it, even though our policy approaches are essentially the same.
MURRAY:
He's appropriating $900 million of your spending on the very matter.
PRIME MINISTER:
Exactly. Now, I mean I think one of the first things we should say is this, is that neither of us is trying to destroy Medicare. We're putting more money into Medicare. We're providing more incentives for doctors to bulk-bill. We're going about it in a different way. We're also providing a low-income subsidy for people for their expenses over and above what they get out of Medicare. The Labor Party is going to oppose that for some extraordinary reason and this is...we're talking here about families who have expenses of over $500 a year and we're promising to provide an 80% subsidy for the out of pockets.
Also the Labor Party is going to oppose the private health funds having the right to offer you what is in effect a catastrophic cover, that if your expenses are over $1000 a year they're going to oppose that as well. The other thing the Labor Party won't allow the Australian public to do is to get their Medicare rebates if they're not bulk-billed more speedily, the Labor Party's apparently in favour of working men and women using their lunch hours to queue up in Medicare offices to get their refunds. We want to introduce this what I call this 'Swipe and your off system' that if you are not being bulk-billed, instead of the doctor saying please get me $35 or $40 whatever the charge is and then go away and get the refund at Medicare.We want a situation where you present your card and you have it swiped and that operates to credit the doctor with the Medicare rebate and all you've got to pay is the difference, so if the Medicare rebate is $25 all you've got to pay is $10. Now, the Labor Party is going to vote against that in the Senate, so what the Labor Party is saying to working people is well you can continue to use your lunch hours to queue up in Medicare offices because our ideology says you can't allow such a modern thing to happen. That's ridiculous. In a technological age where everybody is online for just about everything, the one thing you cannot be online about in Labor's nirvana is getting your Medicare rebate, 'you must queue up in your lunch hour'.
MURRAY:
Talking of queues Prime Minister we've got one waiting for you. Let's go straight to the lines now. Chris in Midland. G'day there.
CALLER:
(Inaudible). Good morning Prime Minister.
PRIME MINISTER:
Good morning.
CALLER:
I'd like to talk about education. I'd like to query the raises to the HECS debt, the 30% rise that you're supposing that universities put on. It's been stated in the Government that $1.7 billion would clear all HECS debts in Australia and the tax cuts amounted are about $2.2 billion is that correct Prime Minister?
PRIME MINISTER:
Well, the tax cuts are in the order of $2.4 billion yeah.
CALLER:
Would this money not be better spent on clearing up the HECS debts for students who are suffering and struggling to get through their education without putting a 30% top up on top of that?
PRIME MINISTER:
Well, no I don't agree with that. I'll go directly and say I don't believe that you should use the money to get rid of all HECS debts and I think HECS is fundamentally quite a fair system and can I remind you and your listeners that HECS was brought in by the Labor Party. It was brought in by John Dawkins when he was Education Minister and it was supported by the then Opposition. What you've got to remember is that 70% of young men and women when they leave school do not go to university, yet their taxes and the taxes of their parents contribute to the 70% subsidy, public subsidy which is still inherent in the education of a person at a university. Even with HECS the great bulk of the cost of educating somebody at a university is still paid for by the taxpayer. Now I think that it is fair and reasonable that people who go through university and as a result are more likely to earn higher incomes later in their lives, I think it's only fair and reasonable that they make a contribution and the HECS system is a very fair way of making that contribution. Under our proposals you don't start paying HECS back until you are earning $30,000 a year. Now, that means that if you're on a very low income or if you're only working part-time your HECS debt is deferred indefinitely. Now, I think as a system that is fair and reasonable. There will be argument about what the levels ought to be and whether you should have competition in relation to fees but I defend the HECS system and I know there are some people in the community who say education should completely free at a tertiary level, I don't accept that, I think people should make some contribution, particularly as they get an enormous economic benefit. I mean somebody who has a successful, professional career and earns a much higher income than somebody who doesn't go to university, why shouldn't that person repay some of the privilege they've had of getting that education and thereby take some of the load off people who for whatever combination of reasons don't go to universities. I just think it's very fair the HECS system. You can argue at the margins as to what the demarcation line should be but I think the principle of it is quite fair.
MURRAY:
Tom in Balcatta Prime Minister is on the line. G'day Tom.
CALLER:
Good morning Paul. Good morning Prime Minister. Prime Minister, you did say when you started messing around with Medicare just recently that you'd guarantee bulk billing for the cardholders and pensioners. Now, our family doctor used to bulk bill. We saw him two weeks ago and we get two bills, one for the wife, one for myself. This bill's $30.05, pay $5 by the patient, $25.05 now he's going to bulk bill but I've got to pay $5.05. Now, you give us an increase of $4 a fortnight, that's for the pair of us for $16 but we've got to pay $20 a month for our medical needs because we need to see the doctor to get our script for those medications we're on. Where's your guarantee Prime Minister?
PRIME MINISTER:
Well, Tom what I said was that if a doctor participated in our scheme they would get an incentive and in order to get the incentive they had to bulk bill somebody in your position. I didn't say that we could force every doctor and no Federal Government can force a doctor to bulk bill anybody, you cannot do it, it's unlawful to do so. What you can do is to offer a doctor an incentive and say to the doctor if you bulk bill pensioners, people in your position Tom, if you bulk bill Tom and his wife then we will give you an extra payment, now that's what we offered. We didn't say that your doctor would be forced under our scheme to bulk bill you, I'm sorry but I didn't say that, nothing can be found suggesting I said that. I can't force your doctor to bulk bill but what I can say is under our scheme he will get an incentive payment directly related to his willingness to bulk bill somebody in your position.
MURRAY:
Prime Minister, Bluey Ryan is the president of the TPI Federation, he's on the line for you. G'day Bluey.
RYAN:
Good morning Paul. Good morning Prime Minister, Prime Minister, I represent the most disabled veterans in this country and since 1996 your Government has ignored them. You said in 1996 as an election promise that you would have Centrelink not discount our payments as income. In addition to that you introduced a proper indexation of pensions for the Old Age Pension, the War Widow's Pension etc but our pension wasn't. That means that we don't maintain its real value. We have lost an amount of about $60 per fortnight as a result of that. You have people that you've sent to Timor who have come back, they've become totally and permanently incapacitated, yet they have come back to a compensation system that in real terms is going out backwards. Now, I just think it's a bit over the top where you were very quick to say what a great job our people do, I think what you need to do is get fair dinkum about this and fix it. As a result of this you're now going to have for the first time in Australia's history a major demonstration of disabled veterans in Canberra. We don't want to do that. We ask you to show some leadership, pick up the phone, talk to the Minister and say look we've got this wrong, fix it.
MURRAY:
Okay Bluey, let the Prime Minister respond to that.
PRIME MINISTER:
Well Bluey I studied what you've said before on this. The question of the discounting and so forth you've talked about, that was studied in the recent Clarke Review, which the Government is examining at the present time. But also what we've studied in the Clarke Review was an overall assessment of the value of TPI benefits at the present time and the finding of that review was that somebody with eligible service on average you got between 90% and 115% of male average weekly earnings which is somewhere in the order of $44,000 a year.
Now, people will always argue it should be more and we're going to look at the other recommendations of the Clarke Review but I don't think it is fair to say that we've ignored your position. I don't think it's fair to say that the Government is contemptuous of it, it's not, and we are looking at the Clarke Review right at the present time and I'm very conscience of the views of your federation.
MURRAY:
Graham's ringing I think from Hollywood Hospital, which is the repat hospital Prime Minister. G'day Graham.
CALLER:
Good morning Paul. Good morning Prime Minister. I was very interested in the news report last night on the welcome home of the Iraqi force, welcome back to Australia. My point is this; I served in Vietnam over 30 years ago and when I came back from Vietnam after nearly a year's service I was dumped off in Sydney with nothing.
PRIME MINISTER:
That was shameful.
CALLER:
Yep. And I know you weren't in office at the time.
PRIME MINISTER:
I wasn't.
CALLER:
And I'm not putting the blame on to you but I fully think that there should be some recompense because I have waited over 30 years now to get what I deserve, 30 years ago and I am now suffering the effects of my Vietnam experience with horrible, horrible effects.
PRIME MINISTER:
Well Graham I think what you've said about the failure of the political process at the time to have a proper welcome home was terrible and one of the things I resolved when we first made the commitment of troops to East Timor was that whatever the outcome we would have a proper welcome home and I have gone out of my way on this occasion to see that not only the families are made to feel as though we're thinking of them while their men and women are away but also when they come back and that's why we're having a series of welcome homes, we're going to have a big parade in Perth in June and we're going to have another big one in Sydney around the same time, not the same day but around the same time so that the public at large will have an opportunity of welcoming these people back.
I understand your point about what can be done now (inaudible) 30 years. I think it's very hard to turn back the clock and do now what should've been done 30 years ago. You'd be aware that there was a very belated welcome home to the Vietnam veterans, what 10, 15, 20 years ago but it was too late and it's very hard to retrieve the (inaudible) of that generation...all I can say to you is I think you were badly treated by the political leaders of that time, very badly treated...
MURRAY:
And it won't happen again.
PRIME MINISTER:
And it certainly won't happen while I'm on the watch, no.
MURRAY:
Prime Minister, thanks very much for your time today. That half-hour goes very quickly.
PRIME MINISTER:
It sure does.
MURRAY:
Okay, good to see you again.
[Ends]