NEIL MITCHELL:
Prime Minister Tony Abbott, good morning.
PRIME MINISTER:
Good morning Neil.
NEIL MITCHELL:
Is there a danger Holden could pull out of Australia?
PRIME MINISTER:
I think people have been speculating for quite some time; ever since Ford announced their pull-out a year or so back. I want Holden to stay. I want the motor industry to survive and flourish in this country. I do wish that Holden would clarify their intentions because at the moment, they’ve got everyone on tenterhooks.
The point I’ve made Neil, is that we took a policy to the election, that policy includes very substantial ongoing support for the motor industry. We stand ready to make that support available but there’s not going to be any extra money over and above the generous support that taxpayers have been giving the motor industry for a long time.
NEIL MITCHELL:
So has Holden indicated that it is considering a pull out?
PRIME MINISTER:
Look, Holden talks to my Ministers and I think the message that we’re getting from Holden is that they’re in two minds and I would like them to clarify exactly what their position is.
NEIL MITCHELL:
And those two minds mean what? Pull out and stay?
PRIME MINISTER:
I think they’re weighing their options and I think they owe it to the workforce, they owe it to the suppliers, they owe it to the people of Australia, to say what they’re doing: are they staying or are they going?
NEIL MITCHELL:
Is that a bit of brinkmanship?
PRIME MINISTER:
No, no…
NEIL MITCHELL:
Are they trying to get money out of you?
PRIME MINISTER:
Well look, certainly over the years, the motor industry has looked for money from taxpayers and fair enough, over the years taxpayers have provided that money.
What I’ve said is that the job of this Government is to try to make it easier for all businesses to compete, to flourish. We’re trying to get taxes down, we’re trying to get regulation down, we’re trying to inject confidence and certainty back into our economy. That’s the best thing that we can do for the businesses of Australia, Neil, not chase them down the road waving a blank cheque at them.
NEIL MITCHELL:
So what money is on the table for Holden at the moment?
PRIME MINISTER:
The money that we have indicated is there through the Automotive Transformation Scheme and the various other funding programmes that have been there for some time, under the former Government and which we are continuing…
NEIL MITCHELL:
How much is that though?
PRIME MINISTER:
So it’s essentially about half a billion dollars a year that’s available to the motor industry. It’s a lot of money Neil.
NEIL MITCHELL:
You can’t increase that, can you?
PRIME MINISTER:
Well, as I said, there’s more than enough money there on the table. It’s available to the motor industry, but there is no more.
NEIL MITCHELL:
Will Qantas get money from you?
PRIME MINISTER:
Well, ultimately all Governments have got to be pragmatic about these things but Qantas has to get its house in order, that’s what has to happen. Qantas is a private company. Yes, it’s an iconic company and yes, it is the national carrier but it is a private company and it’s incumbent upon all private companies to run themselves effectively and profitably, and that’s what Qantas has to do.
NEIL MITCHELL:
Is it not well-run at the moment?
PRIME MINISTER:
I’m not going to make any comment on that because I’m not a business analyst. It’s not my job to pass judgement on the management of any particular business. I am sure Qantas management are doing their best and let’s hope they can get the business in a position where it can continue to operate profitably.
NEIL MITCHELL:
So, will you still look at a subsidy to Qantas or not?
PRIME MINISTER:
Well, we don’t subsidise Qantas…
NEIL MITCHELL:
But will you?
PRIME MINISTER:
Well, no specific proposal, as I understand it, has been put to the Government by Qantas, but the point I make is, if we subsidise Qantas why not subsidise everyone? And if we subsidise everyone that’s just a bottomless pit into which we will descend and if we offer a guarantee to Qantas, why not offer a guarantee to everyone? And again, that’s a bottomless pit into which we will descend.
In the end, businesses have to operate profitably and in the end they have to operate profitably because of their own decisions and from their own resources. They can’t expect Government to do anything other than to create the conditions, the proper market conditions, the best possible market conditions for them to operate; and that means getting taxes down, getting regulation down, creating, as far as we can, a climate of confidence and certainty.
NEIL MITCHELL:
So the other option for Qantas, of course, is to look at their ownership and change the Act so that they can have a higher level of foreign ownership. Is that still on the table?
PRIME MINISTER:
There was legislation passed by the Parliament, it must be at least a decade ago…
NEIL MITCHELL:
’92 I think…
PRIME MINISTER:
Yeah, when the former Labor Government first proposed to part-privatise Qantas and, at the moment, Qantas have not, as I understand it, asked for the legislation to be changed.
NEIL MITCHELL:
Would you look at changing it, I mean it’s clearly…
PRIME MINISTER:
Look, if they came to us and said “this would be a deregulatory way forward, a no-cost to taxpayers way forward”, we’d be happy to look at it, but they haven’t come to us with the proposal.
NEIL MITCHELL:
Well, are you wedded to that proposal of having Qantas in majority Australian hands?
PRIME MINISTER:
The preference, always, would be to have the company in majority Australian hands but if it’s a choice between a greater foreign stake in Qantas and taxpayer subsidy, I ask the people of Australia, what do you prefer? Do you prefer to be paying through your taxes for Qantas, or do you prefer to have it slightly more in foreign hands than it is?
NEIL MITCHELL:
What has happened? Is there an atmosphere in business, ‘we’ve got problems, look to government’? I mean, two major companies here, and we’ve had the Ford situation, we’ve had others, saying, ‘we’ve got problems, the government needs to help us out’. They do employ a lot of people, true.
PRIME MINISTER:
It’s pretty understandable Neil that when people have got difficulties they look to government. I guess that’s why you’ve got government: to solve the problems that you can’t solve yourself. But, the lesson of history here and abroad is that in the end, not even governments have an endless supply of money to prop-up businesses which are inefficient and unprofitable.
NEIL MITCHELL:
Well, I guess this is related, but Joe Hockey said this week the economy is stuck in second-gear. What does that mean to the average person out on the street at the moment, the average person in their car listening now, what does that mean for them?
PRIME MINISTER:
It means that business conditions are not as good as they might be, employment prospects are not as bright as they might be, you’re chances of getting a wage rise are not what they could be.
And our job as a government is not to tell business how to act, it’s not to tell innovators that you’ve got to do one thing rather than the other; our job as a government is to get taxes down, to improve regulation, to try to make government as efficient and effective as possible and that’s what we’re doing. That’s why we want to get rid of the carbon tax because that’s a $550 a year hit on households, it makes every businesses costs higher than what would otherwise be the case.
Qantas for instance, had a $100 million carbon tax bill last year. Virgin had almost a $50 million carbon tax bill. Is it any wonder that our airlines are doing it tough when they’ve got unnecessary costs imposed on them by Government? Now I’m not saying the carbon tax…
NEIL MITCHELL:
My recollection is that they put up tickets to cover that though. They put a special levy on didn’t they?
PRIME MINISTER:
Well, they could maintain the price and be more profitable if they didn’t have the carbon tax. Now I’m not suggesting Neil that the carbon tax is the sole cause of Qantas’ problems, I wouldn’t insult the intelligence of your listeners by suggesting that, but certainly it’s one of the factors in our economy which is making costs higher than they should be and damaging confidence and this is why if Bill Shorten is serious about looking after Qantas and looking after Holden he will not resist the carbon tax repeal legislation.
NEIL MITCHELL:
So, you’ve explained what being stuck in second-gear means to the average person. How long are we going to be running around the racetrack in second-gear?
PRIME MINISTER:
Not too long I hope. As I said, if Bill Shorten would get out of the way and let the Carbon Tax Repeal Bill pass and the Mining Tax Repeal Bill pass, if he wasn’t determined to sabotage things in respect of the ‘debt legacy’ legislation, things would be better.
But, there is some good news Neil, and the Free Trade Agreement which Andrew Robb negotiated with Korea successfully over the last 36 hours that means, over time, hundreds of millions of dollars a year in benefits, thousands of extra jobs. It means more food exports, more manufactured exports and more mining exports.
NEIL MITCHELL:
But doesn’t it mean the automotive steel industry, textile industry, clothing, footwear, they’re going to have more competition? You’re going to have problems there.
PRIME MINISTER:
Well, funnily enough Neil, this is the stereotype, but Korea is our largest or second largest export market for motor engines and gearboxes. So, this Free Trade Agreement with Korea is going to be good for the motor industry.
NEIL MITCHELL:
You don’t think it will increase competition? We’ll have cheaper Hyundais or whatever coming in.
PRIME MINISTER:
And are you upset about that?
NEIL MITCHELL:
Yeah.
PRIME MINISTER:
You don’t like Hyundais obviously! They don’t advertise on this programme Neil!
Look, competition is a good thing and I am confident, that given the right conditions, Australians are more than capable of competing with the best in the world and winning. We can do it on the sports field, we can do it in the marketplace but we’ve got to make sure that we’re not competing with one hand tied behind our back and that’s the problem when we’ve got all these taxes.
NEIL MITCHELL:
Prime Minister I’m sorry, I’m sure you want to hear this. The South African President, Jacob Zuma is addressing the nation.
[cut to President Zuma’s announcement of the passing of Nelson Mandela]
NEIL MITCHELL:
That is South African President Jacob Zuma, confirming Nelson Mandela died a short time ago. Prime Minister, a reaction?
PRIME MINISTER:
Well, Nelson Mandela was one of the great figures of Africa; arguably one of the great figures of the last century.
He was the father of modern South Africa – a multiracial, pluralist democracy where people were judged, to use Martin Luther King’s phrase, ‘on the content of their character, not the colour of their skin’.
So, a truly great man and while I never met him, I did read that book, Long Walk to Freedom, and I guess the impression we get of Nelson Mandela is someone who suffered but was not embittered, but ennobled through that suffering; and he came out of Robben Island well placed, remarkably, extraordinarily well placed, to heal a broken country and what an extraordinary thing that was.
[ad break]
NEIL MITCHELL:
The Prime Minister is with me, we’ll take a call. Tom, go ahead please.
CALLER:
Good morning everybody.
PRIME MINISTER:
G’day, Tom.
CALLER:
How are you mate? Listen, in regards to subsidising the car industry in just handing over cash. Isn’t there some way you can subsidise by dropping the sales tax or the stamp duty on the vehicles to entice the consumer to buy the cars, buy the product, instead of just handing them over money for advertising or infrastructure purposes?
NEIL MITCHELL:
I see, you put the subsidy towards reducing the tax which…
PRIME MINISTER:
It is still a subsidy.
NEIL MITCHELL:
But we can get cheaper cars.
PRIME MINISTER:
Well, that’s true but nevertheless it is a subsidy to Holden, vis-à-vis other vehicles on the market and whether it’s a tax break or a cash advance it is all, one way or another, a subsidy – either it’s revenue that you hand over to them or it’s revenue that they would otherwise pay that is foregone. So it’s still a subsidy.
NEIL MITCHELL:
So is that the benefit of giving something back to the taxpayer by getting a cheaper car?
PRIME MINISTER:
Except you’d have to make up the revenue in some other way. So it’s an adjustment that’s all it is. Look, the truth is that we do subsidise the motor industry very heavily. We have forever. Ever since the first car rolled off the line in 1949, there’s been pots and pots of money available for the motor industry in this country. I’m not proposing to take any money away other than the modest adjustment that we’ve been flagging for a couple of years now. It still means that there’s about a half a billion dollars a year available to the motor industry. I want Holden to clarify whether it’s staying or going. The money on the table is the money there, but there’s not going to be any more money, not any extra money for the car industry.
NEIL MITCHELL:
Thank you, Tom. It’s expected a number of gay marriages will go ahead in the ACT this weekend. Would you rather they didn’t?
PRIME MINISTER:
It’s up to the individuals concerned what they want to do.
NEIL MITCHELL:
But they’re not going to last are they? You’ll undo them.
PRIME MINISTER:
Well, I want the Constitution to be adhered to and under the Constitution Neil, the regulation of marriage is a matter for the Commonwealth Parliament and the ACT has no constitutional standing to do this. That’s the Commonwealth’s position and let’s see what the High Court decides.
NEIL MITCHELL:
Reports of a boat wrecked on Christmas Island, an asylum seeker boat on Monday, is that correct?
PRIME MINISTER:
Scott Morrison issued a couple of statements on this last night. There’ll be more to say at his weekly Operation Sovereign Borders briefing later today. Yes, there was a boat which apparently was wrecked on Christmas Island.
NEIL MITCHELL:
Deaths do you know?
PRIME MINISTER:
Not as far as we’re aware. Some of the people on that boat are in detention. One person as I understand is in hospital and some people are still roaming on the island but the AFP are looking for them.
NEIL MITCHELL:
Steve, go ahead please.
CALLER:
Good morning, Neil how are you going?
NEIL MITCHELL:
Ok.
CALLER:
Look, we just recently brought a new Australian made vehicle. I’m just concerned about the double dipping. If Ford buys parts from a supplier then that attracts GST. When we purchased our car, we had a $5,200 GST on it. Is that double dipping?
PRIME MINISTER:
Oh Gee whiz Steve. It’s the ordinary operation of the tax system as far as I can work out.
NEIL MITCHELL:
Double dipping…
PRIME MINISTER:
And look, good on you for buying a Ford. I wish Ford were staying at Geelong. I’ve had a Ford Territory. I’ve had several Ford Territories. They’re a terrific car and I only wish Ford had developed an export programme for them, because I reckon that the Territory stacks up very well against a lot of other Ford SUVs.
NEIL MITCHELL:
Sounds as if you think the car industry’s been sitting on its hands a bit, has it? It hasn’t been aggressive enough?
PRIME MINISTER:
If you look at the industry now versus the middle of the last decade production is down from about 400,000 to about 250,000. Employment’s down about 15,000. Exports are down. The industry is in a much frailer position now than it was seven or eight years ago and I don’t say it’s all the industry’s fault. I don’t say it’s all the former government’s fault. I mean the high dollar has been difficult. But certainly there are burdens that the industry has carried which government need not have put on them and I think that the management of Ford in particular and to some extent Holden could have been much more aggressive with their export strategy.
NEIL MITCHELL:
Is the relationship with Indonesia close to repaired?
PRIME MINISTER:
I certainly hope so. I’m pleased that Julie Bishop was up there to talk to Foreign Minister Marty Natalegawa.
NEIL MITCHELL:
Have we agreed to the six point plan from Indonesia?
PRIME MINISTER:
What we’ve agreed to set up is a much better channel of communications – a hotline, if you like, so that when issues arise they can be dealt with quickly before they become a public drama. We’re certainly very happy to have a more extensive, more formalised intelligence and security relationship because we think that’s in the best interests of both countries.
NEIL MITCHELL:
And have we agreed to stop collecting intelligence on Indonesia?
PRIME MINISTER:
No, and they certainly haven’t agreed to stop collecting intelligence on Australia. But we are close friends. We are strategic partners. I certainly want Australia to be a trusted partner of Indonesia and I hope Indonesia can be a trusted partner of Australia. I have to say though Neil, I do expect continued cooperation from Indonesia in our anti people-smuggling campaign, because let’s face it, people smuggling is illegal in Australia and the point I’ve been making as politely as I can to the Indonesians is that as far as we’re concerned this is a sovereignty issue.
NEIL MITCHELL:
They’re not cooperating at the moment.
PRIME MINISTER:
There’s been good cooperation in the past; there will be, I am sure, good cooperation again in the future. When a couple of West Papuan boats were planning to proceed from Australia to Indonesia, very rightly, the Indonesians said, well we want you to do everything you can do to stop them and we did, and we did.
NEIL MITCHELL:
When?
PRIME MINISTER:
Just recently.
NEIL MITCHELL:
Recently being since the whole thing blew up?
PRIME MINISTER:
Since the election.
NEIL MITCHELL:
Ok. What have you learnt from the Christopher Pyne disaster?
PRIME MINISTER:
Well, everything to do with Christopher is great and brilliant, you know that Neil.
NEIL MITCHELL:
But you were trying to spin your way out of it, weren’t you?
PRIME MINISTER:
No, look Neil, we decided that as Christopher said last week, he said look there’s $230 million on the table, over and above what Labor had committed…
NEIL MITCHELL:
No I understand that.
PRIME MINISTER:
…to ensure that the coming academic year is certain. He said last week, ‘I hope to be able to commit more’ and over the last weekend we got agreements in principle from the non-signatory states and on the basis of those agreements we’ve committed the full $1.2 billion.
NEIL MITCHELL:
Prime Minister, you’re a former journalist, can you read upside down?
PRIME MINISTER:
I don’t believe I can, but I’ll give it a go. What do you want me to read?
NEIL MITCHELL:
I thought you were reading my question.
PRIME MINISTER:
Oh ok, I’d have to put my glasses on to read the questions!
NEIL MITCHELL:
Thank you very much for you time, have a good Christmas.
PRIME MINISTER:
And to you as well, Neil.
NEIL MITCHELL:
Thank you very much.
PRIME MINISTER:
And to your listeners.
[ends]