OAKES:
Prime Minister, welcome back to Sunday.
PRIME MINISTER:
Thank you.
OAKES:
How do you answer those who fear that execution will make Amrozi a martyr?
PRIME MINISTER:
Look, some people will think that. I guess my answer to that is that it';s the law of Indonesia that he be executed for this crime, and if the focus of exchange between Australia and Indonesia over the next few months becomes an argument as to why … whether or not he should be executed, then that will be quite a confusing distraction, and will send a very odd message and an odd signal, with all the communications clutter, people will think well, this is a bit odd, this man killed 88 Australians. He';s been sentenced to death, and the Australian Government is asking that he not be executed. I think a lot of people would find that odd. He is an Indonesian. It is Indonesian law, and I think the martyr argument will stand up whether he';s executed or spends the rest of his life in jail.
OAKES:
Has this been discussed in Cabinet?
PRIME MINISTER:
I don';t think so, specifically. I said, you may recall, a few months ago, that the attitude I have taken would be the attitude I would take if an execution were ordered. I am – I don';t recall it having been discussed formally. It may have come up informally in an ad hoc way with ministers, but …
OAKES:
Have any ministers said to you we';d prefer it – we should protest?
PRIME MINISTER:
No, I can';t recall anybody having said that. I can';t recall it.
OAKES:
In the light of last week';s Jakarta bombing, do you still intend to go to Bali for the anniversary of that attack?
PRIME MINISTER:
Yes. I would think it myself it would send a very bad signal if the Australian Prime Minister didn';t go.
OAKES:
What about an increased security risk? Presumably there is one now.
PRIME MINISTER:
Oh, I think there probably is some increased security risk, and I may get different assessments between now and the 12th of October, and I';ll obviously have to listen to those, but my strong intention as we speak would be to go to that commemoration. I believe that many of the relatives of those who died will go, and as you know we are offering financial assistance to close relatives and friends of people who died, and I would expect a very big Australian turnout. Obviously there could be some change in the security assessment, but it would take a very big change, as far as I';m concerned, to stop me going.
OAKES:
What';s the latest information you have about the bombing of the Marriott Hotel in Jakarta?
PRIME MINISTER:
Well, it';s still pretty consistent with what';s been coming out over the past few days. Almost certainly the work of JI. And very clearly the people who died were overwhelmingly Muslims. I mean, one of the perverse things is that these things are meant to be done, quote, to avenge our Muslim brothers, unquote. Yet what they do is kill our Muslim brothers, and it';s a reminder that terrorism is a much an enemy of Islam as it is of other religions.
OAKES:
Is it in your understanding that the people responsible were linked with al-Qaeda? Had been trained by al-Qaeda?
PRIME MINISTER:
Well, that is not confirmed. I mean, there are suggestions to that effect, and you get an avalanche of speculations and suggestions. It';s very possible. But not certain. There are links between JI and al-Qaeda, but JI has an independent existence of its own, which of course presents a particular menace in our part of the world, but it obviously copies a lot of al-Qaeda methods. The linkages – the similarities between the Bali attack and the Marriott attack are enormous.
OAKES:
The Indonesian Defence Minister, of course, said that they were trained by al-Qaeda.
PRIME MINISTER:
Well, I haven';t had that confirmed. I';m not saying he';s wrong, but you get quite a – quite a plethora of advice.
OAKES:
What about the likelihood of more attacks?
PRIME MINISTER:
Oh, I think that';s possible in our part of the world, I';m sorry to say.
OAKES:
What about our embassy in Jakarta?
PRIME MINISTER:
Well it';s … it';s a target. It';s a potential target, and – as are all Western embassies. And as are all places where Westerners gather. But these attacks are so indiscriminate that they often take out more Indonesians and nationals of the country where they occur than other people.
OAKES:
And what impact do you think that has – in particular the Marriott bombing had – on the Indonesian Government? Has it changed their perception?
PRIME MINISTER:
I think it will increase their anxiety, and it will intensify their efforts to fight terrorism. Can I say in – in praise of them, that they have done an enormous amount, and it';s a huge task in the process of, you know, creating a democracy, to govern a country of 220 million people, and our response should be to offer them help, and to offer private advice, and to show a great deal of public sympathy and solidarity with them.
OAKES:
Are you satisfied …
PRIME MINISTER:
Which I';ve tried to do.
OAKES:
Are you satisfied with the intelligence sharing that';s been going on?
PRIME MINISTER:
I – I haven';t had any evidence yet, Laurie, to suggest that it needs to be improved.
OAKES:
But there was for example apparently an email intercepted by the Indonesians …
PRIME MINISTER:
Mm.
OAKES:
… which warned of an attack in the area of the Marriott.
PRIME MINISTER:
Yeah, I checked that out, and the best information I have is that there were suggestions of attacks in the general area, but that';s not terribly different from what has been in the public domain for quite some time, but – but I have been told that they – the Indonesians – had no specific intelligence in relation to this attack. The … haunting reality of this whole fight against terrorism, is that you – you have to be incredibly lucky to get a specific warning to pick it up. And it is a – it is a process of – of joining the dots, as they say, and piecing things together. And the frightening thing is that, you know, you have to be really lucky to pick up something. I mean, we';ve done that. We';ve picked up something involving a ferry, and we were able to pass some information on to the Indonesians, and generally help, but …
OAKES:
So Australia picked that information up?
PRIME MINISTER:
Yeah, well, we helped, yeah.
OAKES:
And stopped a terrorist attack?
PRIME MINISTER:
We – well, we passed on some information. Whether we actually stopped a terrorist attack or not, I don';t know.
OAKES:
The US is concerned about the possibility of terrorists using small heat-seeking missiles to attack commercial aircraft. Is Qantas at risk from that sort of thing?
PRIME MINISTER:
The – the information is that it';s more a risk in other parts of the world. There';s been quite a concern about it in America, and also at Heathrow …
OAKES:
Qantas flies …
PRIME MINISTER:
But – yeah, well, the – and therefore there is a concern. I mean, that';s one of the things that we';re constantly in touch with the British about.
OAKES:
And are we trying to find ways to protect Qantas aircraft from heat seeking missiles?
PRIME MINISTER:
Well, what we';re endeavouring to do is to, you know, make sure our intelligence is as – is as effective as possible. But if an aircraft is taking off, the possibility of a – as I understand it, and I';m no technician on these matters – the possibility of throwing something out from the aircraft to divert the missile is – is quite difficult. It';s really a question of, through intelligence and other methods, preventing the missile being launched.
OAKES:
The Australian Institute of Engineers has done a report claiming Australia';s 18 months behind the US in securing critical infrastructure. Is that so?
PRIME MINISTER:
Well, they';ve certainly done a report. I asked about this, this morning, and they would of course have done that report in ignorance of some of the measures that have been taken as a result of a unit being set up in the Attorney-General';s Department to strengthen our infrastructure against terrorist attack, and I';m further told that the measures that we have taken are appropriate to the risk to Australian infrastructure. Bear in mind that the threat to Australia, although real, is nowhere near as great as the threat, it is assessed, to the United States. So, obviously there would, according to the different degrees of threat, there would be different responses. I mean, the Americans have done things that we mightn';t have done for the very good reason that there are things that may not be the same threat here as they are in the United States.
OAKES:
What exactly is the job of the new anti-terrorism unit in your Department, The National Security Division? What kind of people …
PRIME MINISTER:
Well, I mean, what we';ve done is we';ve split, if you like, the Foreign Affairs and Defence division in my Department, into a security division and a foreign affairs. And the security and intelligence division is really just to better co-ordinate the advice coming to me through my own Department in relation to intelligence matters. I think it';s … it';s a good reform. But I don';t want it to be seen – because it';s not – as some kind of new supra-agency. It will just better co-ordinate and systematise the advice coming through to me.
OAKES:
Now, if we face a serious national security situation, why are the Defence Forces now in financial difficulty?
PRIME MINISTER:
Well, they';re not in financial difficulty, but they';re … we';re coming up to the defence capability review. And it seems to be the case in every defence department in just about every country that you have cost overruns, and you have assessments made of what something will cost, and then it seems to fall short of the – or the cost seems to run over what you – what you allocate. And, you know, it';s an area where … where, obviously, people are arguing their case, and we';ll work our way through the defence capability review, and Defence will have adequate resources for its tasks. We have increased the money. Now, I know people say that it';s still only 1.9 per cent of GDP, but Laurie, our GDP has gone up dramatically, because our economy has continued to grow very strongly. If our economy had gone backwards, and we';d continued to spend the same amount of money, it would have gone up perhaps to three per cent of GDP, and people would have said isn';t that a fantastic increase. It';s nothing of the kind. It';s what … it';s the actual increase in dollars that you allocate to Defence that really matters.
OAKES:
Sure. Sure. But we read that the Defence budget this year';s blown out by two billion.
PRIME MINISTER:
Well no, well that …
OAKES:
That … that they';re talking …
PRIME MINISTER:
Well, my …
OAKES:
… about grounding the F-111s because they can';t afford to keep them in the air.
PRIME MINISTER:
Well that $2 billion figure, as I understand it, is adding a whole lot of figures up over a number of years, not just one year. And in any event, until we get the defence capability review, and I have all the papers in front of me, I take some of the stuff that appears with a grain of salt.
OAKES:
All right, you agree that – that you';re spending 1.9 per cent of GDP on Defence. So Kim Beazley points out that the Brits spent 2.6 per cent, and that the Hawke government spent well over two - two point three, I think. So why aren';t you keeping up with the level?
PRIME MINISTER:
Well – well, our GDP is … our economy has grown more strongly.
OAKES:
Yeah, sure, but the threat is growing …
PRIME MINISTER:
Yeah, yeah.
OAKES:
… and your campaigning for votes on national security. So why aren't you spending the kind…
PRIME MINISTER:
Well, I – well, I';d …
OAKES:
Of money the Hawke government did?
PRIME MINISTER:
Well, I';d point to the White Paper increases in allocations for Defence, I';d point to the increase in the number of battalions. I';d point to the increase – the establishment of the – of the counter-terrorism command. There are a whole range of things. I';d point to the fact that we have, over the past few years we have adequately funded operations in East Timor. We continue to fund a presence there. We';ve funded the operation in Iraq, which I think the final figure will be somewhere in the order of seven or eight hundred million. We';re funding the operation in the Solomons. I mean, we are - we are doing these things, and continuing to make investment in capital equipment. And I';ve said before that I can only see an incline in Defence spending in this country. We will spend more on Defence as each year goes by. More on Defence. I mean, there';s no … it – it will continue to claim an increasing amount of our resources.
OAKES:
Prime Minister, we';ll take a break. Return in a moment …
[commercial break]
OAKES:
Welcome back. Prime Minister, let';s talk about domestic issues now. The housing market is obviously squeezing out first homebuyers. More figures on Friday showed that. Are you just going to wait for the Productivity Commission inquiry, or are you going to do something in the meantime?
PRIME MINISTER:
No, not necessarily do nothing between now and then. I think it';s important to have the Productivity Commission inquiry, but I don';t rule out other measures being taken. But there are limits. We have to be realistic. Most people who own houses – in fact, all people who own houses, don';t mind their value going up. I haven';t found anybody stopping me in the streets and shaking their fists and saying John, I';m angry that the value of my house has gone up during the time that you';ve been Prime Minister. The problem';s for first homebuyers, and in the end it';s largely a function of the market. You can influence things at the margin. You can influence it in relation to things like stamp duty, you can influence in relation to land release. And there are some other measures that – that governments can take. But in the long run it is a function of supply and demand, and we – we have to be realistic. But I wouldn';t rule out the Government taking measures. I don';t have any particular measures in mind, but nobody should think that we';ve just said we';re going to have a Productivity Commission inquiry, and that means we';ll put the whole thing off and put it to one side, until we get the results of that inquiry in March.
OAKES:
Well, Mark Latham, the new Shadow Treasurer, is talking about nest egg accounts, and other savings mechanisms. He also wants targeted measures to ensure that people like nurses and police and other essential personnel can afford to live in the areas where they work – do those measures have any merit in your eyes?
PRIME MINISTER:
Well, when you talk about nest egg accounts, you';re talking about providing people with, as I understand it, additional incentives – presumably, if you say somebody';s got to have a nest egg account, to get somebody to save, you';ve got to give them an incentive, otherwise there';d be ... I mean, there wouldn';t be a problem if they were already saving.
OAKES:
Yeah.
PRIME MINISTER:
But … but encouraging people to save more is not going to bring the cost of a first home down. All it';s going to do is increase the capacity of a person if they wanted to, to buy it because they';ve saved. And I mean the best way to get the cost of a first home down is to attack the things that add to that cost. One of them is the shortage of supply of land. Some of the development charges and costs of local governments and state governments are too high. And things like stamp duty are high. Now, people talk about the GST, that';s a fair question to raise. I';d remind them, of course, that we brought in a first home-owners'; scheme to offset, in large measure, the effect of the GST. So it';s not as if we haven';t sort of tried at that front. So I mean, it';d be great if people saved more full stop. To get them to alter their current saving patterns you really have to give them some kind of tax incentive, so when you';re talking about nest egg accounts, you';ve got to know what additional incentives are being provided to people to encourage them to save.
OAKES:
The state governments want the housing inquiry broadened to cover things like immigration and negative gearing. Why not do that?
PRIME MINISTER:
Well … well the Productivity Commission can really go into virtually anything it wants to. I mean, terms – there are terms of reference there, but if the Productivity Commission decides it';s appropriate to roam into different areas, well it should feel free to do so, and I invite it to roam in whatever way it thinks appropriate. I don';t want it to feel constrained. But can I just say on immigration, that';s a fair point to raise, but it loses a bit of its sting when you look at the fact that immigration, although it';s very heavily concentrated in Sydney, hasn';t altered the fact that house prices are rising all over the country. I mean, even in Tasmania, where I was yesterday, people are talking about the way in which the cost of housing is going up. I mean, they';re not complaining, I mean, because the cost of housing in Tasmania was a lot lower before. But what';s occurring is that people are being attracted to Tasmania. They – they sell a modest dwelling in Killara in the north shore of Sydney, and it costs about a third of what they get in order to buy a house on the east coast of Tasmania, and the rest is available as a supplementary retirement income. Now, that';s not – not a bad thing.
OAKES:
What about – what about negative gearing? Now, if the Productivity Commission reported that negative …
PRIME MINISTER:
Well, we won';t alter – we won';t alter negative gearing, I';ll tell you …
OAKES:
You see, the Labor Party says the same thing. Why is it such a sacred cow?
PRIME MINISTER:
Well, it';s not a sacred cow, Laurie. The reason why we won';t alter negative gearing is the experience of Paul Keating and Bob Hawke in 1985. The abolished negative gearing and sent rents, particularly in Sydney, sky rocketing. And the people who it hurt the most were the poorest. The people who depend upon the private rental market, because they cannot afford ever to buy a home of their own. And that is more than 30 per cent of the Australian population. So perhaps a bit less than that, but a significant number of people anyway. And it';s – it';s a false kind of attack on speculation and investment to think that by knocking off negative gearing you';re taking the top off the housing market. What you';re doing is adding tens of dollars a week to the cost of rental accommodation. And that will hurt people at the bottom end of the ladder.
OAKES:
Can I ask you about Senate reform. You';ve promised a discussion paper …
PRIME MINISTER:
Yep.
OAKES:
… on Senate reform, which we haven';t seen yet. I think the idea was to avoid double dissolutions by allowing a joint sitting after the Senate had knocked something back twice. Are you still committed to that?
PRIME MINISTER:
Yes. The discussion paper';s pretty well advanced. I hope to have it out in the next month. And I';ll be putting forward as an option the proposal I raised that if something were knocked back twice during the lifetime of the Parliament you';d have a joint sitting, but rather than necessitating a double dissolution. I';ll be adding another option when it comes out, which is really based on a suggestion that - that was raised by Michael Lavarch, the former attorney-general in the Keating government, now the Secretary-General of the Law Council. And Mr Lavarch';s proposal was that you provide an option for the Prime Minister to call a double – to call a joint sitting, rather, immediately after an ordinary election. That is an election to the House of Representatives and half the Senate, if legislation has been twice blocked in the previous Parliament. Now, the subtle but important difference between that and the raw proposal I raised was that his proposal would prevent rejected legislation not being in effect voted on by the public at an election before the joint sitting occurs, and in a sense it provides a mix of the current procedure, which involves an election to be interposed between the rejection and the passage at a joint sitting. The only difference is that it';s an ordinary election.
OAKES:
Are you still thinking of a referendum at the next election?
PRIME MINISTER:
Well, if there';s enough – I work out that there';s enough public support for it. I';m not going to put it up if it';s got no chance …
OAKES:
No.
PRIME MINISTER:
… of winning. That is just a waste of …
OAKES:
So you – so you will need …
PRIME MINISTER:
… energy.
OAKES:
… Labor backing, won';t you?
PRIME MINISTER:
Well, yes, I – I would want Labor backing. Quite frankly. The history of referenda in this country is that unless both sides back the proposal it won';t get up, and whilst I think this is a desirable reform, unless we can have a real hope of getting it up, there';s no point in putting it up.
OAKES:
Now, the Labor Party';s put the issue of a second Sydney airport back in the news.
PRIME MINISTER:
Yes.
OAKES:
Do you – are you prepared to join the Labor Party in looking for an alternate site for a second airport for Sydney?
PRIME MINISTER:
Well, no, Laurie, our – our view is that whilst you – you can';t be absolutely certain about the future, that the – there';s a very strong probability in my opinion that Sydney will never need a second airport. The … all the advice coming to the Government is that the current airport can handle the traffic out to about 2020. You won';t need to have a look at the issue seriously again for another eight or nine years. We are having a review in 2005. But with technological changes, more people are travelling on larger aircraft, and the – the very strong likelihood of other technological improvements, it could well be that our airport and aircraft – airport needs, rather, can be accommodated. So …
OAKES:
But do you think Labor will win votes by ruling out Badgerys Creek?
PRIME MINISTER:
Look, I – well, I mean, I don';t know what … I think the public will vote at the next election on a whole miscellany of things. I mean, I notice for example this morning that Young Labor is advocating that the second airport be built at Wilton. Well, I mean, perhaps Mr Crean can tell us whether that';s right or wrong. I mean, this is Young Labor, which is probably dominated by delegates from inner city electorates in Sydney, and they';re arguing for Wilton. Well, if he';s ruled out Badgerys Creek, is he going to rule out Wilton? If it';s not going to be Wilton or Badgerys Creek, and he says he';s going to have a second airport, where is it going to be? So I';d like to hear it from Mr Crean about Wilton.
OAKES:
Prime Minister, we';re out of time, we thank you.
PRIME MINISTER:
Thank you.
[ends]