PATRICK CONDREN:
We’re joined now by the Prime Minister, Tony Abbott. Prime Minister, good morning. Thank you for your time this morning.
PRIME MINISTER:
Thanks for having me Patrick.
PATRICK CONDREN:
The states are revolting against your first Budget. Do you think they’re revolting?
PRIME MINISTER:
I think the states are concerned, as you’d expect them to be, to run good public schools and public hospitals and we certainly want to help them to do that and we’ve honoured the Rudd/Gillard agreements for the next three years, but s we said pre-election in the fourth year funding will increase, but it’s not going to increase at the same very rapid rate that was promised by the former government, because the former government was spending money like a drunken sailor. It was paying the nation’s mortgage on the credit card. It was unsustainable and it’s got to stop. We promised that before the election and we’re delivering it now.
PATRICK CONDREN:
And with respect, Prime Minister, you promised other things before the election and haven’t carried through with them.
PRIME MINISTER:
Well before the election you might remember, Patrick, I had this mantra. It was “we’ll stop the boats, we’ll scrap the carbon tax, we’ll build the roads of the 21st century and we will get the Budget back under control” and all four of those things are happening.
PATRICK CONDREN:
But you also said no new taxes and no increasing to existing taxes.
PRIME MINISTER:
Well if you look at the Budget, yes, there is a restoration of fuel excise indexation and that’s going to cost the average family 40 cents a week in the first year and yes, there is a deficit levy on the top 3 per cent of income earners. These are necessary because Labor left us in an absolutely unsustainable position where we were borrowing $1 billion every month just to pay the interest. So, we were borrowing to pay the interest on the borrowings and as anyone who’s ever had a credit card knows, once you’re in that situation you are completely stuffed.
PATRICK CONDREN:
Prime Minister, why didn’t you do more to bring the Premiers along with you, in specific regards to this decision about $80 billion of health and education funding over the next decade?
PRIME MINISTER:
This figure that is being bandied around has never, ever been in any Budget and we were always absolutely upfront before the election and with the Premiers that we were not bound by Labor’s pie in the sky promises in the out years, in years five six and beyond. So, we were very upfront about it. Now, obviously, they now want to know what’s going to happen in three and a bit years’ time and that’s what we’ve got this Federation white paper process in place to address. I’m very, very happy to keep talking with the Premiers about this because the future of our Federation is important. We’ve got to fix the Budget, but yes, we’ve got to fix the Federation as well.
PATRICK CONDREN:
If the states come to you and ask for an increase in GST, or a broadening of the GST base, would you look favourably on that request?
PRIME MINISTER:
Well they haven’t come with that and that’s the kind of thing which, if the states wanted, could be looked at as part of the Federation white paper process.
PATRICK CONDREN:
What about Campbell Newman’s notion that income tax that the Commonwealth raises could be passed straight back to the states?
PRIME MINISTER:
Again it’s really up to the states to put forward a whole range of things if they wish as part of the Federation white paper process. I absolutely accept Campbell’s point that at the moment the states have very heavy responsibilities, but they don’t have the secure source of funding from which to meet those responsibilities and that’s why every so often we have these episodes of argy bargy between the states and the Commonwealth.
PATRICK CONDREN:
Do you see it as anything more than argy bargy? Is it a bit of a storm in a teacup what the states did yesterday?
PRIME MINISTER:
I think it is important to fix the Federation. I’ve long thought that our Federation was dysfunctional. Our Federation has great strengths but in important respects, it does need to be very substantially improved and…
PATRICK CONDREN:
How would you improve it?
PRIME MINISTER:
Well that’s what the Federation reform white paper is all about. I don’t think we can just keep going as we are and that’s why we’ve got this white paper process in place to try to ensure that as far as is possible, different levels of government are sovereign in their own sphere.
PATRICK CONDREN:
Yesterday Premier Campbell Newman said he’d rung a few federal colleagues and given a few people an earful. You’re on a plane with him this morning. Are you expecting another earful from the Queensland Premier on the plane this morning?
PRIME MINISTER:
Well I know Campbell very well. He’s a very, very fine man and we’re friends and we’ll no doubt have the kind of constructive and collegial dialogue that a Prime Minister and a Premier who are friends can have with each other.
PATRICK CONDREN:
I’d like to be on the plane with you, Prime Minister.
PRIME MINISTER:
We get on well. We fully understand the problems that each of us face and we want to try to be helpful, each with the other. But, plainly, there are some big issues that do need to be gone through and ultimately, between now and 2017-18, resolved.
PATRICK CONDREN:
Now News Limited and Fairfax have both published polls today which show that your popularity is in the decline, to say the least, as well as the Government’s popularity – the worst in 20 years according to one of the polls. Do you care?
PRIME MINISTER:
It is always better to be popular than unpopular, but I never thought it was going to be easy to fix Labor’s debt and deficit disaster and I predicted pre-Budget that we would take a hit in the polls and it seems that we have, but…
PATRICK CONDREN:
It’s more a torpedo than a hit, isn’t it?
PRIME MINISTER:
Well, Patrick, the important thing about the Budget is we didn’t construct this for the political convenience of the Government; we constructed this for the long-term strength of the country. That’s what we’re doing here and I think people in the end will appreciate that. We did not do this for ourselves, we did this for our nation and we did not create this problem but we are taking responsibility for fixing it.
PATRICK CONDREN:
But if the states – as a lot of the commentariat think – if the states come around to your way of thinking and push for a GST change, whether it be increasing the GST or broadening the base, that would be to your political convenience, surely?
PRIME MINISTER:
Well I’m not sure that John Howard found the GST that much to his political convenience back in 1998.
PATRICK CONDREN:
But you see the point that I’m making though – if the states ask for it, that gets you off the political hook, as it were.
PRIME MINISTER:
Well, they haven’t and let’s wait and see what happens. But, the point I make is that we do need to fix the Budget. The Government has brought forward a careful, thoughtful, considered, responsible way to fix the Budget. All we’ve got from the Labor Party is endless complaint and no solutions. And look, we do need to fix the Federation as well and that’s why we pre-election talked about this Federation white paper and I’m very happy to get cracking with it, because this is a very important subject.
PATRICK CONDREN:
So, from your perspective then, how would you fix the Federation?
PRIME MINISTER:
Well we need to try to ensure that each level of government has secure funding for the responsibilities that it has. It’s also important that each level of government tries to discharge its responsibilities as efficiently and effectively as possible and I’m far from convinced that we can’t run a whole lot of things more efficiently and effectively at both the state and the federal level. You know, we as the Commonwealth don’t run a single public hospital, but we’ve got a hell of a lot of public servants and I think we can try to ensure that we aren’t each second guessing each other to anything like the same extent that we’ve had in the last few years.
PATRICK CONDREN:
Prime Minister, I know you have to go. Can I ask you one more question?
PRIME MINISTER:
Sure.
PATRICK CONDREN:
When you make a promise in future, whether it be pre-election or otherwise, how will voters know if you’re going to keep it?
PRIME MINISTER:
As I said, Patrick, the fundamental commitments that we made to stop the boats, to scrap the carbon tax, to build the roads of the 21st century and to get the Budget back under control, we are absolutely honouring.
PATRICK CONDREN:
Ok. Prime Minister, thank you for your time this morning.
PRIME MINISTER:
Thank you, Patrick.
[ends]