HADLEY:
The Prime Minister, Mr John Howard, joins us in the studio, Prime Minister good morning to you.
PRIME MINISTER:
Good morning Ray.
HADLEY:
I've got to ask you first, the wedding, we read plenty about it, I know it was a private affair but because of the nature of who the bride's father was plenty of us got to see and hear something about it. A good night?
PRIME MINISTER:
Wonderful, great ceremony, great night, a happy family wedding and thank you for inquiring and can I say I thought the press treatment of it was nice, they were interested but they weren't over obtrusive and I want to thank the newspapers and the television stations for obviously having an interest in it but not sort of interrupting the essential family nature of it and it was a great occasion and I'm very happy and she's married a good bloke and she's a lovely girl. But then I'm prejudiced.
HADLEY:
Exactly, but I think that's a tribute to, apart from yourself, your wife and your daughter, the fact that you know...
PRIME MINISTER:
My wife has made an enormous contribution to the stability of our family, we're very lucky, we're all still talking to each other and everything, we all seem to get on pretty well apart from the usual differences of opinion inside any family. But Janette's made an incredible contribution to that, she's absolutely the number one in that department, really is, just fantastic what she's done.
HADLEY:
Nice to know that the Prime Minister's house is run as are most homes in Australia.
PRIME MINISTER:
Indeed, you make sure you stay in line.
HADLEY:
Exactly. Now I'm a bit perterbed by the story today. Yesterday your Treasurer announced a $7.5 billion surplus and there seems to be much hand ringing and consternation today about instead of saying that isn't that wonderful that we're not in the red, we're in the black, of how we're going to spend it.
PRIME MINISTER:
Well it's already been spent, that $7.5 billion was the surplus from last year and what happens when you have a surplus is that you use it to pay off debt and that's what we did and we've now got very little debt, about 3.9 per cent of our GDP and the average of the industrialised world is 47, so we've got virtually no debt at all. The possibility is that because the economy is running more strongly that there could be capacity in the future for further tax relief. Our philosophy is that if you've got a surplus and you have very little debt, once you've looked after the necessary expenditures, and that's important, if there's anything left over it should be given back to your listeners because after all it is their money, it's not mine or Costello's.
HADLEY:
Just on a story on the frontpage of the Australian today and it struck a cord with me, it's about a family in Sydney's suburbs...
PRIME MINISTER:
The Unicomb family is it?
HADLEY:
Yes, that's them. And they're there, they've got I think three children and they're paying a mortgage. Now about 10 or 15 years ago if you're getting $62,000 a year you were travelling pretty well. This bloke, he earns just a tick over 62, he's listed in the top tax bracket, 48 cents in the dollar, his wife, and she says she's embarrassed talking about their financial situation because she chooses not to work.
PRIME MINISTER:
Well that's fair enough and she should supported in that decision.
HADLEY:
Exactly, she gets $5,000 in a family allowance. But the fact that he's on 62 grand, which is a lot more than some other people are, but it's not as much as a lot of other people though, should he be paying 48 cents in the dollar?
PRIME MINISTER:
I wish he weren't and in fact we would have liked, when we bought the tax package down, that somebody of that level of income was not paying it because we actually wanted the top rate to come in at $75,000 but we were stopped by the Democrats and the Labor Party from doing that. Now that's not just you know a political point, it's a statement of fact. I think the top rate of tax cuts in too early in this country, that's one of the weaknesses of our system but in order to get that up we have to get that through the Senate and we did try when we introduced the new tax system to have that top rate coming in at 75 and the Senate imposed on us a top rate coming in at 60 and we pushed it up a little bit in the last Budget. But it is too low, a bloke like that fortunately has much lower interest rates now than he had.
HADLEY:
So are you terrified at the prospect of it going up?
PRIME MINISTER:
But he's also paying, if he bought his house recently, he's paying more for it because he can afford to pay more because he's got lower interest rates. Look I looked at that, I read that story, and it's typical and that's the sort of family I want to help, if I can, I really do want to help families like that, and then other families too, obviously.
HADLEY:
How do you convince the Senate? How do you convince the Democrats?
PRIME MINISTER:
I think the more stories like that there are that'll work wonders on the Senate.
HADLEY:
Sure.
PRIME MINISTER:
They are increasingly typical. Now there are a lot of people who earn less than that, but there's people who work hard and wages go up and wages are going up and fortunately they are because we were able to do it in a way that's not inflationary.
HADLEY:
There's two big issues today, here in New South Wales we have mandatory water restrictions for the first time since 1996. Now Jonesy spoke about it in great detail this morning and you've spoken to him about watering Australia, but I use this analogy and maybe because I drive across the Harbour Bridge every day, in the 1930's we built the bridge to bring people from the North to the South and vice versa so they put two rail lines as I understand it, they put six lanes on the deck even though there's not many cars about, someone back then said crikey, you know by the year 2000 there's probably going to be a stack of cars we better make it big enough to carry them and you know it's into the future. It just seems to me in 2003 is there the same sort of forethought from our political leaders, state and federally, about what's going to happen to your grandchildren and my grandchildren and our great grandchildren in terms of what's doing? I mean we need another dam in preference to mandatory water restrictions I would think to service the population of Sydney which is increasing 50,000 a year.
PRIME MINISTER:
Well the answer to that is yes, some people argue, and I know Alan and I have talked about this, argue very strongly that you ought to capture the water up the top of the country and bring it down. Now the experts, and I'm not an expert I'm just the Prime Minister, but the experts tell me that from a cost point of view that is absolutely out of the question, and it's far better to find ways of preventing the wastage and preserving water closer to the larger population centres and we have begun to do something on that in relation to things like the trading of water rights and that agreement we reached across the political divide let me say at the last Premiers conference was a step in the right direction on that front. But the experts keep telling me this idea that you capture the water and bring it down, that is just cost prohibitive. Now if the experts persuade me otherwise I'm happy to sort of look at that.
HADLEY:
Well I'm being selfish but what about a second dam for the Sydney basin because we're now over four million and increasing as I say at a rapid rate and most of the people that come here want to live here because it's the best city in Australia. I'm prejudiced.
PRIME MINISTER:
I mean the building of dams is not, I mean it's more a state responsibility and I wouldn't...
HADLEY:
But they need your help.
PRIME MINISTER:
Well they always ask for it, whether they need it or not, they get all the GST without deductions so they're not doing too badly. But if the experts once again make the judgement, but I guess up til now the experts have made the judgement that the arrangements we have in the Sydney catchment area have been adequate but of course we're now running into a situation where we're having sort of these freakish water restrictions, which incidentally can I say I very strongly support as somebody who spends a fair amount of time in Sydney, but also a lot of time in Canberra and elsewhere and there are severe restrictions coming into force in Canberra as well and State Governments have got to be strongly supported by the public and I would urge the public to observe the water restrictions to the letter, I think it's very necessary.
HADLEY:
You've got a new Health Minister, we've got five orthopaedic surgeons at Westmead and Blacktown pulling the pin on public health yesterday because of the liability premium and also of this new tax that's been levied by the Federal Government.
PRIME MINISTER:
It's not a tax, it's a levy to fund the shortfall in the insurance fund of doctors and the fund collapsed because it was badly managed and it also collapsed because the premiums went up because courts awarded astronomical verdicts. Now we've stepped in and provided hundreds of millions of dollars to lighten the load, we've provided a very big subsidy for the premiums for many of the high specialities and we've also provided complete relief for doctors 65 years and over and we've provided a subsidy of 50 per cent of any verdicts the doctors have got to pay between $2 million and $20 million, so we have done, even though we didn't generate the problem, I mean the negligence laws of Australia are not governed by the national government, they're governed by the states. The courts that award these huge verdicts are state courts. But despite all of that we've put an enormous amount of money in, but you know I continue to talk to the medical profession about these issues. I have no argument as a matter of principle, and nor does the Government, with the medical profession, I think they make an enormous contribution to this country and I have some sympathy with the position of many GPs, we want more GPs in certain parts of the country and that is one of the challenges we have. I'm sure once Tony Abbott settles in, and he settles in pretty quickly, he's quite an addictive worker, he'll be talking to the AMA about this and a lot of other issue.
HADLEY:
Well I think they'll be happy to hear that because from what I read today those surgeons are facing $100,000 premiums and then $150,000 on...
PRIME MINISTER:
Yes, I understand, can I just sort of make the point that this is a fund that collapsed because it was badly run, it was not run by the Federal Government, it was run by the doctors, and they under-provided. Now if other people do that they don't automatically get bailed out by the Government. Now we have already provided an enormous amount of health and of course it was aggravated by the fact that you had these huge verdicts that are awarded by courts under state law. Now I'm not attacking the courts, I'm just pointing out that in a federation you have this ridiculous situation where it all winds up being the responsibility of the national government, even though we don't have, we don't control the courts, we don't control the law of negligence, we didn't run the fund, the fund was run by the doctors. But despite all of that we have put an enormous amount in and we continue to be ready to talk to the doctors. But they can't, nobody can expect the Federal Government to underwrite every single thing that goes wrong, I mean after all all I've got is the money that belongs to your listeners, it's not mine, and if I've got to underwrite everything then there won't be any money left for tax cuts.
HADLEY:
I suppose to use a cricketing analogy we look to you to be the backstop, not you personally but the Federal Government.
PRIME MINISTER:
Look I accept that but I don't think State Governments should be absolved from all responsibility, I mean I notice one State Minister this morning saying the surplus ought to be contributed towards getting rid of this levy, well I mean I would say to him that it's his level of government that made a far greater contribution to the problem because they left the negligence laws of this state and the states of Australia unreformed for too long.
HADLEY:
You've given Tony Abbott a great responsibility as our new Health Minister. Is he a future Prime Minister?
PRIME MINISTER:
I have no doubt that if I went under a bus tomorrow Peter Costello would become the Prime Minister. I'm not getting into the business of promoting individuals except to say that there's a clear succession acceptance inside the party, not that I'm intending to go under that bus incidentally, mate I'm very careful the way I cross the road.
HADLEY:
Well you walk often enough.
PRIME MINISTER:
I'm very careful. But look Tony's got a big contribution to make but his appointment should not be seen in that context.
HADLEY:
Your announcement earlier this week about that, the change in Cabinet, was I think, there was a headline somewhere,its a grand final, it's the frontbench to take them on and you've now got rid of the 2nd 13 or the 2nd 11 and you've promoted the top men and top women to the top jobs, is that the way it's viewed with an election some time next year?
PRIME MINISTER:
Well certainly I wouldn't expect another big change before the next election and I believe that I've got a stronger frontbench as a result of the reshuffle.
HADLEY:
There's been all this debate about these damn sheep that are floating around the Middle East for five weeks, we learn the Government last week paid $4.5 million to buy the sheep back, they say if they're not taken somewhere by the end of this week they'll be making their way back here, I mean it does appear to be damaging to us internationally, are you concerned about all of this?
PRIME MINISTER:
Look I am, I'm not only concerned but I'm quite distressed about the circumstances the sheep are now in, although I'm told by the vet that they're still quite healthy and more feed and stock and water's been taken on board. The only alternative, practical alternative to bring them back, if we can't find an alternative destination, slaughtering them at sea would be horrendously difficult, you'd have to reconstruct, partly reconstruct the ship, now there are over 50,000 and I may have, I guess most of your listeners are not familiar with the intricacies of slaughtering but the reality is that you'd have to carry out a major reconstruction on the ship and there, I've heard people suggest simpler methods of slaughter, you're dealing with 50,000 and we believe the only realistic alternative is to bring them back to Australia. Can I just say that this has arisen through no fault of the livestock industry. We are puzzled at the basis of the Saudi Arabian refusal, we really are very puzzled, we don't think many of them had scabby mouth disease, we don't, we just are puzzled.
HADLEY:
Okay. Now last weekend your son-in-law was blamed for the wedding on AFL Grand Final day because he's a rugby union tragic, as his father-in-law is a cricket tragic. Did you play any role in ensuring when these discussions, these delicate negotiations took place between your daughter and her future husband about the date, that it didn't coincide with the rugby league grand final in the feint hope that your team may have prevailed.
PRIME MINISTER:
My team, well I was presented with a fait accompli as so often happens in these family situations because the other part of the equation was that my son-in-law's father conducted the ceremony and that particular date was convenient to him so the combination of a daughter and a son-in-law and a daughter's father-in-law being the officiating clergyman I had no hope.
HADLEY:
You didn't prevail upon the officiating clergyman and said it would be a very very good idea if you held it on this Saturday, not the following weekend?
PRIME MINISTER:
He said this is the available date, that's how (inaudible). I followed the AFL Grand Final, and it was certainly well and truly decided just before I left.
HADLEY:
Because I would have hated it to be next Sunday and the prospect of our Prime Minister with a radio to his lug or a little earpeice or something.
PRIME MINISTER:
I'm glad, I mean no disrespect to the AFL but as it turns out the NRL, I'll be there with my ears back.
HADLEY:
You'll be getting to not the Grand Final breakfast at your club St George Illawarra.
PRIME MINISTER:
It's a Grand Final lunch this year.
HADLEY:
Because of the late start.
PRIME MINISTER:
Yes, and I will be going to that, I've not missed a St George gathering or breakfast since they started in 1985 and I'll be looking forward to that and looking forward to the game. I think it's likely that the Rosters will win, although there'll be a lot of people sentimentally backing Penrith but I just think the Rosters are, they're a great outfit and they've got some real stars but more importantly they're a very strong team. But it'll be a great Sydney occasion because you've got two Sydney teams and that always adds an extra dash to it.
HADLEY:
And followed the following Friday night by the launch of the Rugby World Cup.
PRIME MINISTER:
Yes, looking forward to that. It's the biggest sporting event anywhere in the world this year, and what, it's the third largest sporting event anywhere after the Olympic Games and the Soccer World Cup? And I think it'll be a great advertisement for Australia, I think we're going to find it tough but I wouldn't write the Wallabies off for a moment, I think they went through their worst period that Bledisloe Cup match on the 26th of July, that was their worst. I think they came back quite well in the match in Auckland and their spirits were buoyed by their performance in that match and their rivals are obviously England and New Zealand, New Zealand and England in that order would have to be seen at the moment as favourites but it's not bad not to be the favourite, particularly when you hold the cup.
HADLEY:
Exactly, I'll keep that in mind for the next election.
PRIME MINISTER:
Okay.
HADLEY:
And thank you very much for your time Prime Minister.
PRIME MINISTER:
Thanks.
[ends]