SPEERS:
Prime Minister thanks for your time. Cabinet meets tomorrow to finalise some of the budget details, can you say whether or not they'll be changes to the Medicare Safety Net which was a central plank of your election campaign?
PRIME MINISTER:
Well I can certainly say that the Medicare Safety Net will be retained. I think it's reasonable to expect though that there'll be an increase in the threshold, probably to the levels of 500 instead of 300 and a 1000 instead of 700 for people like you and I. It will still be an extremely generous safety net. The truth is that in order to maintain its sustainability we do need to have a higher threshold. Those two figures were originally our policy. We thought 500 and 1000 were the right levels when we announced the policy. We were forced by the minor parties and the opposition in the Senate in order to get it through to bring the levels down to 300 and 700 but we believe that taking them to 500 and 1000 will maintain the sustainability. It will still be a very generous safety net. The Labor Party's policy is to abolish it altogether, so if they come racing out and saying this is terrible, they should be reminded they don't believe in having any safety net. So I can assure people however that the safety net will be retained, there will be an increase announced by the Treasurer of that order in the thresholds but there won't be any change to the entitlement of people to get 80 percent of their out of pockets over the thresholds or indeed to the items that are eligible for capture by the safety net.
SPEERS:
You went to the election campaign though telling voters that the safety net would be retained?
PRIME MINISTER:
Well it is being retained.
SPEERS:
But you didn't flag any...
PRIME MINISTER:
No, no, no because since the election it has become apparent that the cost of it is going to be even greater than we thought at the time and that is the reason why we believe in the interests of maintaining it, we have to increase the safety net.
SPEERS:
But isn't that a broken promise?
PRIME MINISTER:
Well certainly we didn't say we were going to increase the threshold, no, but at the time of the last election we did not believe that it was going to blow out quite to the extent that we believe that it is now.
SPEERS:
How could you get it so wrong?
PRIME MINISTER:
Well it's not a question of getting it wrong. The threshold is going from 300 to 500.
SPEERS:
But how did you get the cost of it so wrong?
PRIME MINISTER:
Well often there are estimates made and they turn out to be less than expected. It's turned out to be very popular and there were some changes made last year that included some other items relating to obstetricians which have added to the cost. This is a very generous safety net at either 300 more generous, 500 very generous still. What it means is that if you have any unnecessary illness, you have these out of pockets and 80 per cent once the out of pockets go over 500, you get back from Medicare. The Labor party, let me remind you, would abolish that altogether.
SPEERS:
And when will this take effect, from July?
PRIME MINISTER:
Well it will take effect from the time of any legislation but I, given that there's been debate about this, I have taken the decision to indicate what the government's going to do. I don't see any point in that debate rolling on and the Treasurer will be making a formal announcement about it but it can be expected that the announcement will be along those lines.
SPEERS:
It still means that low income families are going to have to pay another $200 before they get any help from the government though.
PRIME MINISTER:
No, no that's not right they get, when you say before 'any help from the government' this is the out of pocket expenses over and above the Medicare rebate, if they are bulk billed then of course there are no expenses if they...
SPEERS:
But those non-bulk billed services like...
PRIME MINISTER:
Yes but until the safety net was introduced last year, they didn't get anything.
SPEERS:
But they voted for you on the safety net as it stood.
PRIME MINISTER:
Well they voted for us for a variety of reasons David, you know that so lets not exaggerate that, they voted for us for a variety of reasons but this is not an easy decision but these health costs are such that they must be looked at from the point of view of sustainability and unless they are put on a sustainable basis, well in time we just won't be able to afford them.
SPEERS:
Tony Abbott the Health Minister fought against these changes I understand. Was this something that you had to come in to make the final decision on.
PRIME MINISTER:
I'm not going to go into that David.
SPEERS:
But is it a blow to him though?
PRIME MINISTER:
David, Tony is a great Cabinet Minister, a great colleague, I am not getting into any of these pieces of speculation about who said what, I am indicating what the government's position is and the Treasurer will of course be in the budget making the formal announcement and the Australian public will then have a clear choice between a government that supports a generous safety net and a Labor Party that wants to scrap it altogether.
SPEERS:
What will this reduce the cost down to and what is the projected cost at the moment?
PRIME MINISTER:
Well I can't give you the exact figure but it will still mean that the cost of it is about double what was estimated at the time in the budget last year.
SPEERS:
So close to a billion dollars?
PRIME MINISTER:
Well I am not going to tie myself to a particular figure but the cost of it as estimated in the budget last year is now calculated when allowing for the change I have just announced will still be about double what it was in May of last year so it is a very generous safety net, it is being very widely used and I think most people when they stop and think will regard the change the government's made although many will be disappointed, as being reasonable in the long term interests of sustaining it.
SPEERS:
The other big changes that Cabinet is considering for this year's budget is in the area of welfare. Will you be agreeing with what your Minister Kay Patterson is arguing that there needs to be a huge increase in child care places if we are going to push more single parents into the workforce?
PRIME MINISTER:
One of the elements of a comprehensive workforce participation plan involving sole parents is the provision of more childcare places, yes. As to how many, well that is something that we've got to work out but what we want to do is to encourage in a variety of ways, single parents and others once their children have reached a certain age, to in the first instance at least enter the part time work force and I think that's a good thing, its not a question of denying them benefits, it's a question of helping them back into the workforce and if that can be done in a sensible supportive way and that includes the provision of child care places, that's part of it you can't change the system and not give sole parents the wherewithal in their own lives to take advantage of these changes.
SPEERS:
And for the disabled which is the other area of change, will there be incentives for employers to take them on as workers?
PRIME MINISTER:
Well we are looking at that area. I think some, there have been a whole lot of reports, I don't want to get into confirming those reports but we are looking at all the implications of that. Let me make the point that we are not going to force anybody who's disabled and unable to work in the commonly accepted meaning of that term into the workforce. What we are talking about is providing encouragement for people who can do some work, the sort of period of time we are looking at is working 15 hours of work a week and if you can do that then it's not unreasonable with appropriate arrangements and training and incentives, it's not unreasonable to encourage people to participate. And my experience has been that many of them want to. But people who are really disabled, they're not going to be affected in any way. I want to make that clear from the very beginning.
SPEERS:
Can you also rule out changing the way that welfare payments are indexed at the moment because you did say last year that you wouldn't be changing the way that they are, that those payments do increase.
PRIME MINSTER:
You mean the pension?
SPEERS:
Well for disabled pensioners, for sole parent pensioners, will the way that their payments are indexed be change?
PRIME MINSTER:
So as to avoid any confusion, I think we ought to wait until all the decisions have been taken and announced because different responses can have different meanings according to what situation you're referring to, and if you're referring to what I said last year I'd better have a look at that. But just let me say this, that we haven't made any final decisions on this workforce participation programme yet, we're working through it. It's a very big reform, it's a very difficult reform, and the Labor Party will obviously play opportunistic politics with it. They're not really interested in reform. But we recognise with an ageing workforce and a shortage of workers, and unless we provide greater opportunities for people to get into the workforce then we're going to run out of workers and our economy is going to suffer and I would hope that the Labor Party and others who might be prone to play politics with a package like this would bear that in mind.
SPEERS:
Prime Minister, the Queensland Premier, Peter Beattie, this morning suggested a five year phase out of these business taxes that you and Treasurer Peter Costello are demanding that they eliminate to keep the GST deal alive. Are you going to agree to the five year phase out that he's proposing?
PRIME MINSTER:
Well I heard what Mr Beattie said this morning. I thought he was trying to be constructive. We are constructive, all we want to do is to keep the states to the original deal and the whole idea of the GST in one respect was to get rid of these very anti-business unproductive taxes. Now when the states have all told us exactly what they will agree to and what they want we can then make a decision. I'm not going to give an ad hoc on the run response to each comment that's made by a State Premier, except to observe that I listened to Mr Beattie this morning on the radio and I think he was trying to be constructive and I can say in reply that we'll be constructive but I'm not going to commit myself to the precision of our response until I know exactly what all of the Premiers intend.
SPEERS:
You'd be favourable to that sort of proposition?
PRIME MINISTER:
I'm not going to commit myself David, I'm simply saying that I heard what he said, I thought he was trying to be constructive, but until I know exactly what they are willing to do, and they do tend to change a bit, and I'd like them to give us a considered response. We put a considered proposal to them, Peter Costello on behalf of the Government, at the Treasurer's meeting, put a considered proposal and I would like them to come back to us in an organised, considered way and we will, in those circumstances, we will respond in a considered, civilised manner.
SPEERS:
Moving to foreign affairs Prime Minister, you said exactly a week ago on this issue of a treaty of amity and cooperation with South East Asian countries that you didn't think it was appropriate Australia should sign it because it was from a mindset that we've really all moved on from. Do you still stand by that...
PRIME MINISTER:
Well that was what I believed and in sense it's still my position. But all things being equal it's not the sort of treaty that Australia would sign, not because there's - it's objectives we don't have any quarrel with, peace and amity and non-aggression, we have no aggressive designs on any of our friends in the region, far from it. It's now being injected into the question of Australia receiving an invitation to take part in a summit and it's my understanding from discussions I've had today that the invitation is to become part of the summit process and not just to attend one meeting. So that does represent a significant move forward. So in those circumstances we'll obviously sit down with our friends in the ASEAN region and discuss what's being put. I'm not prepared to go further than that at this stage, it's some time before the meeting takes place and we'll work our way through it. Suffice it to say that the response I gave last week was a response that I believe and still believe if you're looking at this thing in complete isolation and if all things were equal. But there's been a new element, it's been linked in a very explicit way. So we'll have a look at it.
SPEERS:
So you're no longer saying you won't sign it?
PRIME MINISTER:
No, I haven't said that, that's what you're saying.
SPEERS:
Is there a way of...
PRIME MINISTER:
Look David, I'm not going to play those games. What I've said that is we'll have a look at the whole thing. But bear in mind that we're now dealing with a proposal about an inclusion in the whole summit process. But you shouldn't make any assumptions that we're going to rapidly change our mind.
SPEERS:
When you say you've spoken to people and it looks like we'll be part of the whole process, not just one meeting, who have you spoken to and how important is that?
PRIME MINISTER:
Well I talk to a lot of people and I'm satisfied on the soundings I've made that what is in contemplation is not Australia just attending one meeting. Now that's quite an important issue that...
SPEERS:
Which raises the stakes somewhat doesn't on in getting involved?
PRIME MINISTER:
The stakes are always being raised in all sorts of things, David. We'll work our way through this...
SPEERS:
You're confident we'll attend?
PRIME MINISTER:
No, look, we'll work our way through it and whatever is the right outcome for Australia we'll reach. I mean we are not desperate to be at every meeting, let me make that clear. It would be good if we could be at the East Asia summit and be a full participant. But it's got to be on terms that are consistent with Australia's long term national interest and we're going to work our way through that and you shouldn't make automatic assumptions.
SPEERS:
Next week you're visiting both China and Japan, they seem to be going through a bit of a rough patch at the moment in their own relationship. Will you be- you've spoken just last week I think it was about playing an honest broker role in this region, is that something you'll be doing on this visit? Urging the two of them to sit down and work out their differences?
PRIME MINISTER:
Oh David, I wouldn't be so presumptuous as to try and do that. Australia has good relations with both countries, the trade and economic and political relationship with Japan is somewhat older than that with China but the Chinese one has made great strides in the last few years. I obviously hope as a friend of both countries that their current difficulties are temporary and they can be resolved, but I don't presume to inject myself as some kind of arbiter into that, I'm quite sure they're capable of dealing with that matter themselves. We have a lot of bilateral fish to fry with both countries, very important relationships and we'll be working hard to further extend them and it is a very important visit and it comes at a time when there's a lot going on in our region and it comes at a time when this country is about as involved in a very detailed way with countries of our region that it has been at any time in Australia's history. We really have things going on with Japan, with China, with Indonesia, with Malaysia, with Thailand, with Singapore and so the list goes on and it's a very interesting, active, positive time for Australia's relations with the region.
SPEERS:
And before you head off to Japan and China you'll be farewelling some of the Australian troops leaving Darwin for Iraq in this new wave of Australians heading over there. What will be your message to them in Darwin on Sunday?
PRIME MINISTER:
Well we'll be, my wife and I will be meeting them in an informal atmosphere and I'll be saying to all of them how much we wish them well, we admire their professionalism. I'll be telling them the nature of the mission, I mean they're certainly aware of it from a military point of view but it's a very important mission. It's to support an ally and friend in the region Japan. It's to reassure the Iraqi people that as they gradually break free from their terrible past into the new democratic future, they have friends and it's a very important time to reassure and reconfirm and consolidate support that Iraq has received and I know that they will go every last man and woman amongst them, will go with thoughts and prayers for their safety of all Australians and I'll be saying those sorts of things. But they're well trained, they're looking forward to their mission, they have an optimistic positive view about their role and I hope that I might in a small way reinforce that.
SPEERS:
And Prime Minister just finally two very important court cases today, Rodney Adler, two and a half years minimum jail time. Did the courts get that one right?
PRIME MINISTER:
I don't choose to comment on the adequacy or otherwise of the sentence, that's a matter for the court.
SPEERS:
Okay and the other one is Schapelle Corby, I'm sure you'll take a similar position on that. We're waiting to see what the prosecution is going to recommend in terms of her sentence, but is Australia confident that if she does get some jail time, she'd be able to transfer and come back and serve it here?
PRIME MINISTER:
Well we do have those sorts of arrangements with a number of countries and without being too specific about her situation, bear in mind, although there is a lot of interest in this case which I fully understand, we must respect the processes of the Indonesian Justice System. I don't think Australians would appreciate running commentaries from foreign leaders on court cases involving the nationals of their countries in... if the trial were taking place here. I mean I feel anybody whose under the sort of stress that she's under. I don't know the circumstances of it, that's a matter for the courts, I'm not in possession of all the facts, I just hope that justice is done and she's treated fairly and decently. And we have to have faith in the Indonesian justice system because that's the system that's trying her. We have made our position in relation to the death penalty clear, generally speaking and that applies in all cases whether it's Indonesia or any other country. As far as serving sentences are concerned, well it is desirable that people serve out sentences in their home country if that's possible and that would apply once again generally as well as in particular cases. But beyond that I don't really want to get too specific because in some ways that may not be helping the process. Sometimes a little, you know, less comment and fewer words can go a further distance.
SPEERS:
Prime Minister thanks for your time.
PRIME MINISTER:
Thank you.
[ends]