LAWS:
Prime Minister, good morning?
PRIME MINISTER:
John, good morning. Did you have a good holiday?
LAWS:
I had a terrific holiday, thank you Prime Minister. What about you?
PRIME MINISTER:
I had a good break. One or two interruptions, but I had quite a good break and I'm glad to be back.
LAWS:
Are you glad to be back even though this Wheat Board scandal seems to be rolling on?
PRIME MINISTER:
Oh that's just proceeding in a way that is investigating the activities of the company. It was going before I went on leave and it's still going.
LAWS:
I wonder how long it'll continue to go?
PRIME MINISTER:
Well the commission has to report by the end of March and it's presided over by a very competent man and we'll just wait and see what its findings are.
LAWS:
I see the broadsheets this morning suggesting that you'd written to and were working closely with the Wheat Board officials on Iraq, is that correct or incorrect?
PRIME MINISTER:
Yes absolutely, of course I was, it was back in 2002. John there's quite an echo in your...
LAWS:
I'm sorry.
PRIME MINISTER:
studio, I mean I can hear you but there's quite...I don't know whether my voice is distorted, but anyway.
LAWS:
So you're fine?
PRIME MINISTER:
I'm fine, that's good. In 2002 everybody, both sides of politics, and everybody in the wheat industry was concerned that Australia's wheat sales to Iraq might be reduced, or might be lost and obviously the company which was the monopoly vendor of Australian wheat and still is, wanted the company to work very closely with the Government to make sure that that didn't happen, and I certainly wrote that letter. I would've been failing in my job as Prime Minister if I hadn't done everything I could to maintain and protect the wheat market because it was one of our best and on that particular score, to some extent, I had the enthusiastic support of the opposition who in fact, after there was a bit of a problem with wheat sales and AWB people went to Iraq, congratulated AWB on saving our wheat sales despite the bad diplomacy, as they put it, of the Federal Government.
LAWS:
What knowledge did you have of the payments that were being made by the AWB to the Iraqi regime at that time?
PRIME MINISTER:
You mean the illegal payments?
LAWS:
Yeah.
PRIME MINISTER:
None.
LAWS:
Okay, but they are illegal?
PRIME MINISTER:
Well they are alleged to be illegal. Look we had no knowledge of any corrupt behaviour. Now the question of whether AWB Limited behaved corruptly is something for the commission to decide on, and I'm not going to pre-judge that, I have to be careful, in fairness to the commission, not to pre-empt any of its findings. But obviously consistent with that I will answer criticisms made of the Government by the Opposition or anybody else. I mean the particular criticism is that these letters which were entirely unexceptionable, normal letters you'd expect a Prime Minister write in the circumstances of that time, in someway implicate the Government in the alleged payment of bribes. Now that is not true and it's a claim that I reject.
LAWS:
Okay could I put this to you, with the greatest respect, is it possible that you're a little bit na‹ve thinking that everything would have been entirely above board when you're dealing with people like the Iraqis and that regime?
PRIME MINISTER:
No I don't, I don't believe I was na‹ve because there was no evidence as distinct from anything else that was put to the Government to suggest that anything corrupt was occurring. And can I also say that the experience I'd had with people involved with AWB was quite a positive one. They did not strike me as people who would be engaged in improper conduct.
LAWS:
Was there a certain culture of do whatever it takes as far as the deal with Iraq was concerned?
PRIME MINISTER:
Not that I was aware of, no.
LAWS:
Okay. I've got to say I find it quite amusing that an individualist, someone as politically insignificant as Julian McGauran, could cause such a drama for the Coalition. What have you got to say about his defection?
PRIME MINISTER:
Well I don't think in the sweep of things that it's a big issue. It's a sensitive issue for the National Party and I respect their sensitivity and I ask members of the Liberal Party to respect it. But it's not going to alter the direction of the Government, it's not going to alter the outcome of votes in the Senate in my opinion. Bear in mind that for all the talk there's been about Senator Joyce and about other things, bear in mind that last year we got through all of the major things we wanted. It was one of the most successful years, legislatively, that the Government has had, if not the most successful in the almost 10 years we've been in power. So you're right to say, lets give the thing a sense of perspective. It's a sensitive issue because you have two parties that are very similar and you have one that makes up about what 85, 86 percent or 87 percent of all the Coalition, and you have the other making up the remainder. There's always a sensitivity in relation to issues like this, and I understand that. We didn't set out to entice Julian McGauran to join the Liberal Party and I certainly knew nothing about it, it was bolt from the blue as far as I was concerned.
LAWS:
What do you think his motive was?
PRIME MINISTER:
You'd have to ask him that, I'm not going to get into that. He certainly wants to go on supporting the Government, there's no doubt about that. He's a Coalitionist and therefore it's only logical, notwithstanding the understandable sensitivities of the National Party, it's logical that the Victorian Liberal Party accept his application for membership. It would be foolish not to.
LAWS:
I really feel quite strongly that the majority of Australian's aren't really fans of a system that allows people to occupy a position in Parliament for which they have not been elected. I mean a Nationals Senator suddenly he leaps over to the Libs; he was elected there was he?
PRIME MINISTER:
But he was elected as part of a Coalition ticket.
LAWS:
Does that excuse it?
PRIME MINISTER:
Well the question of whether he should have left the National Party and join the Liberal Party is something that he has to answer for. I mean no political party in our position when you've got an application to join it from somebody of another party whose philosophy is almost identical with our own; no political party in our position would be exercising good judgement if it knocked that application back. But bear in mind that he was elected as a member of a joint Coalition ticket. I mean he was elected at the last election as a member of the Coalition Senate ticket for the state of Victoria and the vote that put him into the Senate, he had the number two position on that ticket, the vote that put him into the Senate was a vote for the Howard Government, wasn't it?
LAWS:
Yes I accept that.
PRIME MINISTER:
I mean people didn't put one in front of; very few people put one in front of his name. They put one in front of the Liberal / National Party Senate team. So it was quintessentially, overwhelmingly a vote for the Government and therefore if he's to keep faith with the electorate, he should continue to support the Government. The question of whether he supports the Government via membership of the National Party or the Liberal Party is...
LAWS:
Immaterial.
PRIME MINISTER:
It is an issue to be debated and some people will be critical of his behaviour. I understand that and he really has to answer to those things. But you are asking me as leader of the Government and leader of the Liberal Party what the Liberal Party should do; the only sensible course of action is for the Liberal Party to accept his application, but at the same time, to do as I have done and that is publicly express my understanding of National Party sensitivity and to say that if the boot were on the other foot and he had been a member of the Liberal Party that abandoned the Liberal Party for the National Party there would be a lot of Liberals who would be as upset and sensitive about that as there are members of the National Party. So I just ask my fellow Liberals to understand that, importantly, we should both remember that we've had ten years of a hugely successful Coalition and we don't want to do anything to upset it.
LAWS:
Okay, you don't believe that it's going to have any effect on your numbers in the Senate?
PRIME MINISTER:
No I don't.
LAWS:
What about the Queensland Liberal Senator Santo Santoro, he's a member of your new Ministry, but he's never even been before the electorate, nobody's ever voted for him?
PRIME MINISTER:
But that's been the case since Federation.
LAWS:
Yes I know, is it good?
PRIME MINISTER:
Well the alternative is that whenever a person resigns from the Senate before his or her term has expired, you have a by-election and that involves a vote of the whole state, not just the electorate. See a by-election for the Senate would involve a vote of the whole state. Now you see we have always from the time of Federation, we have always filled casual vacancies in the Senate by the appointment of a replacement Senator by the State Government of the state from which the person has come. Now that has been the method of filling a casual vacancy in the Senate I think since Federation; certainly in my living memory.
LAWS:
Yes, but because it's been there that long does it make it right?
PRIME MINISTER:
Well the alternative is to have the expense of a vote of the whole state.
LAWS:
So is cost the reason?
PRIME MINISTER:
Well I mean it's in the Constitution John. I can't change that, it's not a matter of Government whim. If you're asking me if we ever consider the Constitutional amendment to take away the power of state parliaments to fill casual vacancies and have by-elections, no. Would I? I think probably not, no, because I don't think the expense in those circumstances would be justified. The one change that was made in 1977 following the events of 1975 was to require that the person filling the casual vacancy comes from the same party as the person who departed; either by death or resignation. Now, I think that most people agree with that and they voted overwhelmingly for that amendment. So Santo Santoro filled a vacancy which had previously been the position filled by a Liberal who had been elected by a, in effect, a bloc vote of Liberal supporters in the state of Queensland at the previous election.
LAWS:
Really, it is a bit like the Julian McGauran thing, they voted for the coalition.
PRIME MINISTER:
No, in the case of Queensland it is a bit different, they actually voted; we don't have a joint senate ticket there, that is the difference and that really is a significant factor. You see, Julian was not elected independently as a National Party Senator and there is a significant difference between Victoria and Queensland in that respect. That would actually add, if I might say so, somewhat more weight to some of the criticism that has been made of the Liberal Party in Victoria. If Julian had been elected as a stand-alone National the situation might have been a bit different in the sense that people could have said, look, we voted for a National and the people who voted for McGauran didn't want a Liberal, they just wanted a National whereas in McGauran's case he was a member of a Coalition senate team and people voted for the Howard Government. They put one in front of the Liberal / National Party senate team and it was the Howard Government, or the Howard / Anderson Government that they were voting for; in other words the Coalition Government. I think that in terms of the will of the people, I think it makes a little bit of difference, whereas in Queensland when Santo Santoro's predecessor, the person he replaced, was elected there; that person was not elected as part of a Coalition ticket, he was elected just as a Liberal.
LAWS:
Economists are suggesting today and I am sure you've seen it that new workplace laws will soon make welfare a better option for many low skilled people who have children because they are going to be paid more on welfare. How do you respond to that?
PRIME MINISTER:
I don't agree with that. In fact the whole thrust of our welfare to work reforms is to encourage people to choose to be in the workforce rather than to be on welfare. We are going to make it more attractive for people with, once children pass the age of eight, we are going to make it more attractive for them to be in the workforce. I can't agree with their conclusions, I think that they are wrong in fact.
LAWS:
Did you read what professor Mark Wooden had to say about it? He said the new system is likely to slow the growth of the minimum wage while sole parent pensions will rise at least 5 per cent a year.
PRIME MINISTER:
I think he is jumping to conclusions in saying that it is going to slow the growth of the minimum wage. I don't think that he is, in any event, taking into account the impact of the welfare-to-work changes and the requirements placed on people once their youngest child has reached the age of eight; if they are now on the sole parent pension.
LAWS:
Well of course time will tell...
PRIME MINISTER:
Time always tells in these things John. The goal of the changes is to have a situation where it is more attractive for people to go into the workforce than to remain on welfare.
LAWS:
This desalination remains a major issue, I've kept half an eye on it, particularly in the Sydney area. Are you going to apply a bit of pressure to the Iemma Government in the hope that they might change their minds on the Kurnell desalination plant?
PRIME MINISTER:
Well I don't think desalination is a good option for Sydney, I don't.
LAWS:
Well what is the other one?
PRIME MINISTER:
I think recycling myself. I would expect in his new role as my Parliamentary Secretary, and having responsibility particularly for water matters, Malcolm Turnbull will have something to say over the month ahead about this issue. Predominantly the argument of course in New South Wales and in Sydney has to be carried by the Opposition because that is predominantly a state matter; although the Federal Government does have a view and you will increasingly hear that Federal Government view because water is a national issue as well as a local issue.
LAWS:
I imagine Mr Costello with a sigh of relief with Mr Turnbull looking after water instead of talking about tax reform.
PRIME MINISTER:
Well as a backbench member of parliament he is entitled to express his views on any range of things. I don't think, though, Peter Costello is other than his very calm and assured self.
LAWS:
Prime Minister it is very good to talk to you. I hope this is the beginning of a wonderful year for you and the Government and the country.
PRIME MINISTER:
Thank you very much, we all wish it for the country.
LAWS:
We all should anyway and we all should make sure it happens because we are all part of it.
PRIME MINISTER:
Indeed we are, thank you.
[ends]