PRIME MINISTER:
Well we have made the announcement, I guess the only other thing I would like to say, because although this is, this is a different part of Queensland, as you know I visited Innisfail last Monday and as a result of some views that were put to me by a variety of people, including Senator Boswell, the Leader of the National Party in the Senate and Mr Katter, General Cosgrove, I have decided that the duration of the wage subsidy in relation to Innisfail and Cyclone Larry will be extended from 13 to 26 weeks. That was a particular request of a number of groups including the cane growers and the banana people. Also the cut off date for applications will be extended to the 31st of August.
It is fair to say that the Commonwealth has now contributed $237 million* to help the community of Far North Queensland and particularly the community of Innisfail, to recover from Cyclone Larry. Every dollar has been well spent. As a nation, we can afford that kind of assistance to our fellow Australians who suffer adversity through no fault of their own, but it is a very significant amount. I don't say this in any churlish sense, but it far exceeds the investment that has been made by the Queensland Government.
JOURNALIST:
Prime Minister does that suggest that the time for the recovery, is actually taking longer than was anticipated?
PRIME MINISTER:
I think, Jim, that it was impossible when we made the original decision to know how long it would take. I felt at the time that we'd probably have to consider extending it, because 13 weeks is not a long time. Generally speaking, people are happy with the rate of recovery. There seems to be enormous optimism and there has been great co-operation between the Federal Government, the State Government, and Local Government and General Cosgrove has done a fantastic job. As indeed the Johnstone Shire have done. Johnstone Shire Council, I found dealing with the Shire, the Mayor is a very constructive person and I wish them all well.
JOURNALIST:
Mr Howard, can you explain the need for a new boat to help process asylum seekers and help out Customs in that area?
PRIME MINISTER:
Yes the need for it is obvious that you can have a situation where you could have a surge of illegal fishermen and women and then need to have a holding capacity of that kind is very sensible.
JOURNALIST:
But do they really need to spend $10 million on a purpose built boat to transfer the fisherman to....
PRIME MINISTER:
I think you do, Jim, because this is a particular need in a special situation and there is always a danger if you try and use something that has not been purpose designed to these circumstance that there is criticism made that the facility is inadequate or unreasonable and I think it is entirely appropriate.
JOURNALIST:
Mr Howard do you plan to meet with the Muslim leaders in some way to discuss Lebanon and Hezbollah, I mean there seems to be some calls for that?
PRIME MINISTER:
I will be having a conference telephone call later on this morning, in fact just before I leave Queensland, to talk to a group of leaders of the Islamic community in Australia. They want to express their views to me about the situation in the Middle East and I am very happy to listen to them. The Government's position on the listing of Hezbollah as a terrorist organisation will not change. We had very good grounds for that and nothing has altered the Government's position. I will actually listen to the viewpoint being expressed, but we are not going to change our attitude in relation to Hezbollah. We share the distress of others about the loss of life, we hope the fighting ceases. A ceasefire will not last unless it is based on a willingness to address the cause of the problem because a ceasefire which did not do that would be bound to breakdown and the renewal of the fighting could be even more savage and more intractable.
JOURNALIST:
Just back on asylum seekers, the legislation has been set down for Tuesday, do you expect there will be some changes, or will there be more debate in the party room?
PRIME MINISTER:
I am sure there will be more debate. I don't mind how much debate there is, but we made quite a number of changes and they were announced before the parliament rose and I do not at this point anticipate further changes to the legislation.
JOURNALIST:
And will debate in parliament proceed definitely on Tuesday?
PRIME MINISTER:
Well I don't know about Tuesday Jim, the current plan is that the debate will be resumed in the House of Representatives next week, whether it is Tuesday or Wednesday I leave that to powers greater than myself, like the Leader of the House. I never like to get in his way.
JOURNALIST:
Two Premiers, Queensland and Victoria, are stepping up the pressure on stem cell research, what's your position on that? What will you be saying to your colleagues?
PRIME MINISTER:
What I said several weeks ago and that is that Cabinet having looked at it, is not persuaded that there was a need to change in the current legislation. I did, however, say that I would be very happy to have a party room debate on it. It is not an easy issue this and I envy those people who think that it is all one way, it is all black and white. You are either for it, or against it. It is quite a complicated issue this, and people have different views and we will just talk it through. I did undertake to have a discussion and I am sure that there will be a good discussion. I won't be having that next Monday, although people may raise it in the course of the policy, the broad ranging policy debate, but as you know we have a joint party meeting set down for Monday afternoon, which I am inviting people to give the Government any advice that they want and to raise policy issues. We do this every six or 12 months and it is a very valuable way of distilling the views of my 120-odd Coalition colleagues.
JOURNALIST:
Prime Minister over the past few weeks you've been virtually right around the country, taking soundings from voters, everywhere you go, you're assailed with questions about the high price of petrol. Is there really nothing you can do beyond offering sympathy to motorists?
PRIME MINISTER:
Jim, it is very hard to responsibly hold out the hope that we have some silver bullet which is unavailable to any government in the world. It is the cause, the result rather, of high crude oil prices. It is the biggest bugbear that people have. I get, as you say, more questions about petrol than anything else. I understand why. I am all the time looking at whether, even at the margin, things can be done, I am doing that now, to assist. There is no simple way of cutting the price of petrol here in Australia, given the high price of crude oil and the other factors that are pushing up demand for fuel around the country. There is, of course, the possibility of cutting excise, but I have explained before that to cut excise by a meaningful amount, which would be about 10 cents a litre, would cost almost $3 billion. And there are many people in Australia who would argue very strongly that if the Government has got $3 billion it ought to spend it in some other way. There is not uniform agreement that the top priority would be to spend $3 billion in cutting excise. In any event, the excise by world standard is not high and it is not the cause of the price having gone up. The time of the last election petrol in Australia was about, in states other than Queensland let me remind you, was about one dollar a litre. It is now gone up, I guess, conservatively by some 30 or 40 per cent. Now none of that has been to due to excise, none of it has been due to local factors, it has been all due to world circumstances and we are beginning to enter a period where adverse developments around the world are starting to impact on our very strong economy. And the greatest of those is fuel costs and it is a difficult issue for the government, it's a difficult issue for the average Australian and I can promise Australians that we're all the time looking at ways of trying to help at the margin, but it's very difficult because you can't ignore the brutal laws of economic arithmetic.
JOURNALIST:
And you'd have to say that the pressures are there for further rises rather than reductions in the near term as far as petrol prices go?
PRIME MINISTER:
At the moment there is no comfort on the petrol price front particularly given the chaotic situation in the Middle East, the conflict that is going on there. My view was that prices were very high before that, it would be wrong to contribute all of it. But you've got to remember that one of the major causes is the huge increase in demand for crude oil coming out of China's growth and we mustn't lose sight of that fact. Ironically, of course, China's growth is our benefit, it's one of the perversities of the way the international economy works. There's probably no country in the world that is benefiting more from China's expansion, no other country benefiting more than Australia. So in a sense one of the explanations is that we are, in an economic way, a bit of a victim of our own export prosperity with China.
JOURNALIST:
One of the other things of course is lack of refining capacity around the world, do you think that in Australia we've neglected this for too long?
PRIME MINISTER:
Well I think it's a private sector, I mean governments are not oil companies. I think there's been a lack of refining capacity around the world because there was underinvestment in it because people didn't think there'd be such great demand for it. Several years ago this crisis in energy supplies was certainly not foreseen and I think everybody has been surprised by China's growth. But, I mean, there was an accumulation of factors. Katrina had an enormous impact on the refining capacity in the Gulf of Mexico. But all of this is telling us and telling the Australian community that we are entering a phase of economic management where there are more challenges than there were a year ago, or even six months ago. It's all the more need to have in charge of the management of the economy a group of people who are experienced and who are not risk takers, who are very careful and good managers, and who understand that even in a strong, growing, robust economy there can be difficulties and setbacks. And I think that is going to be the scene we face for a while yet. And these are forces that no government can control. We can try and influence at the margin, but there isn't a government in the world that's found the answer to high oil prices. If there is, would somebody please tell me, and I'll hop on the VIP tomorrow and go over and talk to him or her.
JOURNALIST:
Should we be looking at new technologies to replace fuel or to....
PRIME MINISTER:
Well we are looking at a lot of things. One of the reasons why I'm having this nuclear inquiry, I mean that's long term, it won't produce any alternative tomorrow, but one of the reasons I'm doing it is because I understand that we've got to search for all the alternatives. And one of the reasons why we're investing heavily in clean coal technology is to see if we can make coal more greenhouse gas friendly. We are looking all the time at these things. One of the reasons why I think we've turned around the whole debate on ethanol, not to the point of supporting mandating which I don't think is sensible, but we have turned the debate around. Having an open mind on every aspect of energy is one of the great policy imperatives of 2006. I mean we think all the energy alternatives should be looked at, not just a limited a number, and that's why we have a very different approach to uranium and nuclear energy from that of the Labor Party.
JOURNALIST:
One of the things that comes through in questions to you about petrol is continuing suspicion in the community about collusion among the oil companies, and I know that the ACCC is monitoring the price cycle etc, but do you think there really ought to be more in the way of transparency in terms of pricing? Is there anymore that can be done on that front?
PRIME MINISTER:
There have been, Jim, umpteen inquiries and none of them have revealed the level of collusion that I understand people think occurs. And I understand why they think it, you've got this oddity of the price being very low during the week, because of heavy discounting, many of the independents discount heavily to maintain their market share, and that's very understandable, and as the demand surges at the weekend, discounting disappears and the price goes up. Now if you understand the dynamics of petrol retailing, that is an understandable and plausible explanation. The Senate is having yet another inquiry, it's starting today I think, it's being chaired by Queensland Senator George Brandis, and I'm sure that all parties will be asking these sorts of questions. And I would be surprised if it produces a different outcome, but when the proposal was put up by the Opposition, we agreed to it.
JOURNALIST:
Mr Howard, just on next week's....
PRIME MINISTER:
I think we might finish.
JOURNALIST:
Just on next week's party room meeting, will you be seeking some kind of formal endorsements from the party room, as well as having sent out your letter to them?
PRIME MINISTER:
Oh no. No, that's the end of it.
JOURNALIST:
Can I squeeze in one more question, just on interest rates I understand yesterday you refused to apologise for the state of the economy, and than on the 7.30 Report last night you did come forward with an apology, are you sorry?
PRIME MINISTER:
I don't think the word apology arose in either comment. What I said yesterday morning, and what I said last night, and what I say again is I am sorry that interest rates went up in the sense that I understand it will hurt some people. And nobody likes interest rates going up, but I do not believe that the Reserve Bank had any responsible alternative because we now have inflationary pressures caused largely, but not only, by fuel price increases that didn't exist a year, 18 months ago. And as circumstances have changed it's necessary for the central bank, if it's to behave responsibly, to do what it did. And by acting now it's very likely, I can't give guarantees, but it's very likely, that the bank has reduced the possible pain of future action in the future.
JOURNALIST:
Do you think we can expect another rise by Christmas?
PRIME MINISTER:
Oh look I will not be speculating about that, definitely not. And can I just take the opportunity of saying, I heard some very misguided talk this morning from somebody, and it was reported on some programme, I forget which, about recession. Now for anybody to be even uttering that word in the present circumstances, with the strength of this economy, they are being misguided to say the least. Last question.
JOURNALIST:
Thank you for your indulgence, Prime Minister. Will there be a reshuffle between now and the resumption of parliament?
PRIME MINISTER:
No.
JOURNALIST:
That's settled that for now. But are you planning a reshuffle?
PRIME MINISTER:
Oh look Jim, I answered a direct question which you put to me, but as for the future I never rule those things in or out. It's one of those things you would be unwise to do.
JOURNALIST:
Prime Minister just one regional question.
PRIME MINISTER:
One regional question.
JOURNALIST:
A new railway line is going to be installed between Toowoomba and Gladstone, there has been a call associated with that...
PRIME MINISTER:
That's good. Mr Brough has been a great advocate of that.
JOURNALIST:
There's been a call for a new cross-mountain road linking Toowoomba with Brisbane to cater to the needs of freight and things of that nature. Any thoughts about that?
PRIME MINISTER:
Well I haven't examined the details of that call. I don't want at this stage to commit myself either way on something like that.
JOURNALIST:
So no approach has been made yet?
PRIME MINISTER:
No, no, approach has been made to me that I'm aware of, no.
Thank you.
[ends]
*$239 million