JOURNALIST:
You were talking this morning about the justification for an interest rate rise, are you effectively endorsing one?
PRIME MINISTER:
No I'm not. I'm simply acknowledging that the Reserve Bank will make the decision and I'm also making the point that controlling inflation is very important and the Reserve Bank has to keep that very much in mind. We have a very strong economy and when you have a strong exuberant economy there is always some inflationary pressure and if a stitch in time saves nine well a lot of people would understand the reason for that.
JOURNALIST:
How does that sit with what you said in the 2004...
PRIME MINISTER:
Oh very easily. What I said in 2004 was that interest rates under a Coalition government would always be lower than under a Labor government and I stand by that.
JOURNALIST:
You said you would keep interest rates low and now you're effectively endorsing a rise aren't you?
PRIME MINISTER:
No, what I'm saying is that interest rates will always be lower under a Coalition Government than under a Labor Government.
JOURNALIST:
Forecasts have been raised today about the drought and its effect on commodities, $6.2 billion loss is being predicted. Is it time for the drought to be declared a natural disaster?
PRIME MINISTER:
Well, words don't mean anything. What happens is the assistance you give...
JOURNALIST:
Surely that would unlock extra funding?
PRIME MINISTER:
No, no, no it doesn't. It shows a complete misunderstanding of how drought relief operates. It is completely separate from the natural disaster provisions. That deals with things like fires.
JOURNALIST:
What do you think about Mr Heffernan's suggestion today about rice growing in Australia?
PRIME MINSITER:
I don't agree with it.
JOURNALIST:
Are you surprised by the ABARE forecast downgrade?
PRIME MINISTER:
No, I'm no surprised at all. I found the ABARE forecast entirely predictable.
JOURNALIST:
Are you worried about the effects of the drought on economic growth?
PRIME MINISTER:
The drought will cut economic growth, fortunately we've got strong growth in other areas of the economy, but it will cut economic growth and we must understand that and that's why we must help our farmers through their hour of need.
JOURNALIST:
You're in an irrigation area here, with governments considering buying back water for the Living Murray programme, there is concern that desperate irrigators will sell it just because of the stress and strain that they're feeling will be pulled back on that plan to purchase the (inaudible) environment?
PRIME MINISTER:
I think the most important thing in relation to water entitlements in this area is for there to be some sense of justice for people who've paid good money for water, bought it in the water trading market and then have that allocation arbitrarily taken back without compensation. That's not something the Federal Government would do.
JOURNALIST:
What about the environmental water (inaudible) proposal to buy back water, will you consider holding off given that...
PRIME MINISTER:
I think the system that we have in place is appropriate.
JOURNALIST:
Mr Howard, do you think Sheik al Hilali has properly integrated into Australian society?
PRIME MINSITER:
Oh I don't think he has. What has to happen in relation to this man is that the issue has to be solved by his own community. It's not my place to say who should occupy a position in a religion, be it the Islamic religion, the Christian religion or the Jewish faith. It's for the flock to decide who will lead them. The only point I would make is that if this matter is not properly resolved, it could do lasting damage to the perception of the Islamic community within the entire Australian nation and that would be a great tragedy because I want Islamic Australians to feel as much a part of this nation as anybody else and I'm working very hard to bring that about.
JOURNALIST:
This goes to the heart of what are Australian values...
PRIME MINISTER:
I don't think there is any doubt that he was not expressing Australian values. I can say without fear of contradiction that what he said is repugnant to Australian values.
JOURNALIST:
Doesn't it disturb you that this man is apparently the leader of the Muslim faith in Australia?
PRIME MINISTER:
Look it is not my place to appoint people, I think I've made my position very clear, but we have a separation of church and state in Australia and it's not for me to say who should lead the Islamic faith. It is for me, however, to point out the consequences for the place of Islamic communities in Australia of this matter not being properly resolved.
JOURNALIST:
(inaudible) deported...
PRIME MINISTER:
Deported? No, well look, you can't deport people unless they have committed a criminal offence and they have been prosecuted and convicted and we live in a democracy. When we get disturbed about what people say we should not suspend due process and the whole thing should be dealt with in an orderly fashion. What should happen and I'll say it again, is that the Islamic community has got to take this matter in hand themselves, and if they don't then there is the risk that people will use their failure to do so against them, however unfairly, and I really am asking the Islamic community to come up to the crease and handle this matter themselves. Thank you.
[Ends]