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Transcript 9588

TRANSCRIPT OF THE PRIME MINISTER, THE HON P J KEATING MP INTERVIEW WITH JEREMY CORDEAUX, RADIO 5DN, 16 MAY 1995

Photo of Keating, Paul

Keating, Paul

Period of Service: 20/12/1991 to 11/03/1996

More information about Keating, Paul on The National Archive website.

Release Date: 16/05/1995

Release Type: Interview

Transcript ID: 9588

PRIME MINISTER
TRANSCRIPT OF THE PRIME MINISTER, THE HON P J KEATING MP
INTERVIEW WITH JEREMY CORDEAUX, RADIO 5DN, 16 MAY 1995
E& OE PROOF ONLY
JC: Good morning sir.
PM: Good morning, I am very pleased to be here.
JC: Are you well?
PM: I am as well as I can be I think, Jeremy.
JC: It would seem to me that you are in election mode. You have just
suggested to us that we are going to get our Mt Barker road completed
and the airport extended. Can you give us a time at which this will be
commenced?
PM: We will be starting on the Mt Barker road under the Commonwealth's
national road program, the National Highway Program, and that will
virtually begin this year. We will start, now, the feasibility studies for
the airport. That is, extending the airport and doing the feasibility
studies, the environmental assessments, and getting the constructions
begun and completed.
JC: Now they are nice little goodies for us. It tells us that you have come
to town with some sweeteners which a politician doesn't do unless he
wants something.
PM: Can I say that the Mt Barker road goes through a heap of Liberal
electorates, so there is no value for us, the Labor Party, in that other
than the people of the State and, as you know, this is a thing that
needed doing and it is an eight kilometre divided freeway, including a
six lane tunnel, so I think that will be good. The other thing I should
mention to you is that in two weeks time when I am having the
pleasure of launching the One Nation train remember in the One
Nation policy statement we said we would build a standard gauge
railway from Adelaide to Melbourne so that will be launched in two

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weeks. So you can now carry freight or passengers from Brisbane to
Perth via Melbourne and Adelaide for the first time in our history. So
there is that, plus the airport. So all these things are about the further
integration of South Australia.
JC: Well, we thank you. These are nice goodies. Now you say that this is
as good as it gets. Now as a politician, if this is as good at its gets this
will be a good time for an election surely.
PM: Well the business environment has been very good. We have in the
last year just on 5 per cent growth and 2 per cent inflation.
JC: You see, it hasn't been that good for us here.
PM: True and there is a question in that, isn't there. I mean why is
Queensland, New South Wales, Victoria and Western Australia
growing?
JC: Well we have a lot of debt and we have had a bit of trouble, as you
well know?
PM: You have had trouble that is true, but I don't think the debt is a
problem. I think that South Australia has got to identify its strengths
and go and seek them. Being at the foot of Asia, as we are, we are
now closer to the fastest growing markets in the world, which was
never the case they were always in Europe or North America. We
are really now for the first time in our history and I think that South
Australia, I mean, this sort of developed economy, you realise that the
South Australian economy is about the size of the economy of
Malaysia, roughly, so if Malaysia is a tiger, then so can South Australia
and I have just got to get that message through Dean Brown maybe
he has got to start roaring a bit and doing something.
JC: Accordingly to this poll this morning, this Newspoll, more people
believe the Federal Budget will leave them worse off, rather than better
off. Does that surprise you? I mean, that perception?
PM: Well polls are a funny thing. The main thing that I think people would
understand is that the main aim of the Budget were two things take
the pressure off interest rates and fill the savings pot-hole out there in
the 90s and that is basically what we have done through taking the
Budget back into surplus and this big change to superannuation.
JC: What about all these economists who see it, and I think there were
only three dissenting voices out of 130, that they believe that interest
rates haven't peaked. What is your opinion of that? Do you think they
have peaked?

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PM: Well let me demonstrate this point to you, Jeremy. Last year we sold,
our bond selling program, the Commonwealth Bond program was
$ 21 billion $ 21,000,000,000 as a result of the Budget changing, this
year it will be $ 6,000,000,000. In other words, there is a reduction in
the Commonwealth Bond selling program of $ 15,000,000,000. That is
just an unbelievable figure and that is why the long bond yields the
ten year bond interest rates fell by 1 per cent. You see ten year bonds
two weeks ago were about 10.1 per cent and they are now at
9.1 per cent because of that big fall in the Budget bond selling
program and that is what has taken the pressure off interest rates and
that is why I think the housing rates fell at the end of last week.
JC: So the drop in the interest rates, you are definitely claiming as a result
of the Budget?
PM: Well I am certainly claiming the long term bond rate and I think the
housing rates, the whole environment. Well let me put it this way, if
they'd have risen on Friday the commentators which have said " Budget
rejected, absolutely rejected".
JC: Do you get the feeling you can't win?
PM: Well, sometimes.
JC: Well do you think, let me ask you again, the interest rates have
peaked, that they are not going to go back up again after this?
PM: I endorse what the Treasurer said the other day, I think barring a shift
in world markets, we have seen much of the strength in the propensity
of rates to rise taken from it now and that the Budget change and that
continuing low inflation and another Accord with the trade unions on
wages augurs very well for inflation and interest rates.
JC: I imagine you saw Terry McCrann's comments on the Budget, did you?
PM: Well Terry is a pre-Copernican obscurantist.
JC: Well let me see, he said you are like an old fashioned life insurance
salesman " Mr Keating is selling the Budget using figures which are
utterly misleading and arguably fraudulent this is over the
superannuation.
PM: I know. Look Terry is that far to the right he is out of sight and let me
just say in the Treasury paper Saving for the Future, what we did in the
Budget was put through the most comprehensive and revolutionary
change ever to Australian savings and retirement incomes. What it
will mean, Jeremy, is that every Australian person will have at least
per cent of wages and salaries going into superannuation. At the
moment, most of them have five. Now what that will mean, and these

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are the Treasury's numbers, is that somebody I have got the little
book here Saving for the Future, which the Treasury has published
on 100 per cent of average weekly earnings, that is $ 33,000 a year,
will end up with a nest egg of $ 461,000 and an annual income of
$ 30,000. So you take somebody who, and these are all in today's
dollars, is on $ 33,000 a year will at the end of their working life, in
today's dollars, will end up with an income of $ 30,000 a year, which is
about twice what the pension is.
JC: So he is totally wrong when he says the difference between the
promised tax cuts and the Government's contribution is $ 17 billion,
maybe more, and that is what we are missing out on?
PM: No, no, because what we did, we put the tax cuts into these
superannuation accounts and that grows over the years. So there is a
great benefit there. Can I demonstrate it this way as well. Apart from
the income of people, put it this way, when I became Treasurer in 1983
superannuation coverage was only 40 per cent, this year it is 90 per
cent. In 1983, we have $ 40 billion in super funds, this year it is
$ 186 billion and what the Treasury is estimating, as a result of this
change, by 2020 we will have $ 2000 billion in today's dollars that is
2 trillion in super funds, $ 2,000,000,000,000 ten times what we have
now in super funds.
JC: Well let's hope it is well managed.
PM: Well it has to be well managed. But see the thing is if the Liberals
thought of this, Terry McCrann would be out there like the daily blab
blah, yak, blah, yak, blah, yak you know, here ye, here ye is the great
change, but if it comes from a Labor Government, it wouldn't matter
what we did with Terry McCrann I can tell you.
JC: Well this is I guess the crunch question. Now the tax cuts in L. A. W.,
you changed your mind about that. What happens if you change your
mind about this?
PM: Well, no, understand what we did. I mean I want to just make this
point, what was the Government's principal commitment at the
election. The Government's principal commitment was get
unemployment down. On election night I got up and said we won't
leave the unemployed behind, we will put our arm out and pull them up
behind us, we will move along as a society together. Now the
Government's target in the election was 500,000 jobs in 3 years. In
2 1/ 4 years we have got to 650,000. So we are 150,000 over the
target in 2 1/ 4 years. So on that hardest commitment of all, the
hardest thing for a Government to deliver employment we have
exceeded our target, or put it this way we reached our target in 2 years
and it was a 3 year target and we are now 150,000 over. That was a
principal commitment. One year earlier than the election in One

Nation, that was in March 1992, we said we have introduced two tax
cuts to get the economy cracking. What we did, following the election,
was bring one forward and pay it in full at the end of 1993. So the first
round of tax cuts were brought forward and paid in full at the end of
1883. The second round we said we would introduce probably in 1998
was the word and the Treasurer and I used. Well they will be
introduced in 1998 except they will be paid into superannuation
accounts and not as cash. The reason we are taking this opportunity
to do that is to say to people well what would you rather have, you
know, $ 10 or $ 15 in your hands or a retirement income, taking the
chance now of saying if the Government does this now I won't ever
have to worry again about my retirement income.
JC: But that average worker could be able to retire on $ 462,000, it applies
to somebody who actually starts work in the next century?
PM: No, no. To go to the full, to the end of their working lives, at the end of
their working lives, that is right it is at the end of their working lives.
But let's say, take somebody now who is in their 30s and is going to be
retiring, we have also calculated what it will be for them and it will be
that somebody who is in their 30s now, a couple in their 30s who retire,
they will end up with an amount 3/ 4 of the pension on top of the current
pension. In other words, they will retire on an amount of 3/ 4 extra to
the current pension and their children will retire on an amount 100 per
cent extra to the current pension. In other words, doubling the current
pension for their children 3/ 4 of the current pension on top of the
pension for them. So in other words there is a benefit in here for all
working people, from now on, it is just that the benefit gets to its full
bloom if you are in the system longer. So let's say you are 23 years of
age today, you will then pick up the full $ 30,000 in income at the end.
Or if you end up on twice weekly earnings, you end up with a lump
sum of $ 750,000 at the end. But, again, you have got to be in the
scheme 40 years. But the benefits are there for somebody who has
got 20 years to go.
JC: The Prime Minister is my special guest. I just want to ask one more
question and then we will take some callers. I don't know how much
time you can spend with us.
PM: I am right, we are okay.
JC: But we would be grateful. This story that is around this morning about
Senator Alston and Dick Warburton and Dick Warburton's article in
The Financial Review where it is said that you rang a senior executive
at The Sydney Morning Herald and complained about that article and
referred to how such an article, gutter press, might jeopardise
Conrad Black's desire to have a bigger share of The Sydney Morning
Herald.

PM: The story goes on, apparently, that I then sort of said " oh well, Conrad
Black would otherwise have 50 per cent of the Herald".
JC: Yes. Did you do that?
PM: No. But do I call the media executives, well that is a habit I have got
into over the years.
JC: Did you object to that article on that particular occasion in that manner,
or not?
PM: Not that I can recall. But the article of course was without foundation,
but the weight of what Senator Alston is saying is that in some ways
the Government has offered Conrad Black 50 per cent of John Fairfax
and Sons that is totally untrue.
JC: The interest being if he laid off you.
PM: But it is totally untrue. It is a complete fantasy.
JC: So never at any time did you offer that sort of* a suggestion to a senior
Fairfax executive?
PM: No. Absolutely not.
JC: That article that Dick Warburton, who was a fairly heavy weight in the
business world, he accused you of being able to hate and get fairly
close to the politics of hate. What did you make of that?
PM: Well I thought that was just extraordinary. This is a man we put on the
Reserve Bank Board.
JC: Where would he get this feeling from?
PM: And if you look at the last election, a lot of the people who were
supporting the Coalition, we have appointed them to boards. I mean
we have appointed a number of people. Warwick Smith, the Liberal
frontbencher, we appointed as the Telecom Ombudsman. The former
Mayor of Brisbane, Sally-Anne Atkinson, we appointed as the Trade
Commissioner to France.
JC: When somebody gets stuck into you though, publicly or privately, do
you take that personally?
PM: No, because it happens all the time. In public life you have just got to
let it roll off your back, I am afraid. But can I just say what the Alston
thing is about is that there is a terrible argument going on in the Liberal
Party, right at the moment, over Mr Connolly's sacking at the hands of
Dr Nelson. And Connolly has hopped right in to this and said here we

are, when superannuation is a major issue in the Budget and the
country, you've fired your superannuation spokesman and at the same
time he said Senator Watson, in Tasmania, is now under threat from
the former Premier, Mr Gray. So what is happening, Jeremy, is this,
there is a huge stoush going on in the Liberal Party remembering that
Mr Filing and Mr Rocher have been defeated in Western Australia, Mr
Connolly has been defeated in New South Wales, Senator Watson's
head is on the block in Tasmania with Mr Gray and Connolly is saying,
here I am a loyal servant of the Party, been it all my life, I am the
superannuation spokesman I get knocked off by Brendan Nelson,
who tried his luck in South Australia, didn't succeed there, has come
up to Bradfield. As I said yesterday, the Liberal Party is like one of the
sort of clubs you join at the door you know. As you walk through the
door you sign up. Oh you want to be in Parliament. Oh yes I would
like the safest Liberal Party seat in Australia. Well just step this way.
JC: So what Senator Alston is doing is a bit of a smoke screen?
PM: I think so. I think they said what can we do today to sort of get the
attention off Connolly and Senator Watson and this stoush we are
having over Brendan Nelson, and particularly that he is backed by
Bruce Shepherd, who was part of the Joh for Canberra campaign. You
see John Howard has got things in his head, he is still hearing voices
about the Joh for Canberra campaign and hates the sight of Shepherd.
Shepherd masterminded the Nelson victory up in Bradfield, so there is
a very, very big tussle going on and the bit of meat they have thrown
across the trail this morning is Senator Alston and this cocked up story
about me offering 50 per cent to dear old Conrad Black.
JC: Have you ever ordered a tax audit of anybody?
PM: No, of course not. Of course not. I was Treasurer for eight years and
you have never heard one word about the propriety of my stewardship
of that job. You can just imagine the private stuff I see. Here is John
Howard taking the legal documents from the Hindmarsh Bridge case in
South Australia, letting McLachlan open them, sending them to the
opposing side's solicitors and then dropping them in the newspapers.
I mean in terms of propriety, Howard and McLachlan have got the
morals of alley cats.
JC: Prime Minister if you can spend some time with us, we have got some
calls, but I would get you to put those headphones on and I shall turn
you loose on the listeners and the listeners loose on you. Hello, Del.
Are you there Del?
C: I am here.
JC: Here is the Prime Minister.

PM: How are you Del?
C: Good morning Prime Minister. I am a sole, lone parent carer of a
young woman who is 30 years of age, with severe multiple disabilities.
I read last Wednesday that carers can now qualify for the Carer's
Pension, even if their family income is less than $ 61,000 and that they
can amass assets of less than $ 559,000, which is in effect if they get
$ 165 a week for a Carer's Pension and an income support increase of
$ 165 a week. Lone parent carers received nothing out of this Budget.
We are expected to provide 24 hours care for our severely disabled
children for $ 165 a week. We can't earn $ 61,000. We don't have
partners and on that amount of money, we can't amass assets of any
sort.
PM: Well that is not true, can I say. In the Budget we have increased the
allowance quite substantially not with the actual based pension, but
the allowance. You might have missed that in the news coverage and
I think that is an important change. But we have increased, of course,
that Carer's Pension over the years and it has the same free areas,
that is you can earn without losing part of it to a certain level, and we
have now got an increase in the allowance th at goes with it. Can I say
these are the very things that John Howard and Peter Costello want to
cut. I mean, you know Mr Howard has said that he doesn't believe that
the Budget should be addressed by any changes in revenue, he will do
it all on the out base side. Well this is one of the areas that they are
most snaky about. That is, single parents and people on single
incomes in the social security system. In contrast, we have increased
the Rent Allowance in the Budget and we have also increased the
Carer's Allowance.
JC: Okay, Del, let's move on. Malcolm, hi.
C: Oh, good morning Prime Minister, how are you?
PM: Good Malcolm, thank you.
C: Look direct democracy has been endorsed by all the major parties at
some time and I would like to know why Labor didn't introduce it during
the 80 years as part of their policies. At the moment, the unions have
extra input to the political process by the virtue of their numbers and I
feel that the rights of the wider community should be extended by this
means.
PM: What do you mean?
C: Well, Citizens Initiated Referenda is a way of combating corruption in
Governments in the present or future and it is being used that way in
other countries and also where people generally feel that the

Government have their priorities wrong they can indicate that by
referendum.
PM: Well I think I speak here for the Coalition as well as for the Labor Party
and neither of us support Citizens Initiated Referenda and you might
notice that when this debate arose recently, the then Opposition
Leader, Alexander Downer, came out against it and so, as I recall, did
John Howard and the reason is I think that see what you have in
Australia is you have an election every three years and you also a
parliamentary system which means that your MP has an office and
your constituency, and you can go and see them and talk to them and
the political parties are affected by the ambient political climate of
debates as they come along, whatever that debate might be. There is
a very responsive, you have got a lot of participatory democracy in
Australia. Here I am, I am the Prime Minister, I am on a radio station
talking to you. You get Ministers, you get Opposition Leaders on radio
every day of the week and on television and you get a right to hire or
fire the rest of us every three years. So I think where we have seen
some of these things like the proposition I think it was proposition 41,
wasn't it in California, where they decided they'd reduce, by Citizens
Initiated Referenda, the revenue raising powers of the State of
California, they were going to put police off the beat, they had to cut * all
the public transport and it wouldn't take us very long before people
thought it was a bad idea.
JC: Proposition 13.
PM: Proposition 13.
JC: Anyway, thank you for the call. A quick one from me Prime Minister.
Did you see " 60 Minutes" on Sunday?
PM: No I didn't. No.
JC: They had a story about people living in Nimbin. They called
themselves " the ferals" and they made it quite clear that they couldn't
be there leading their pot-smoking lifestyle without the dole. Could we
get some assurance that if somebody places himself or herself in a
position where they can't get a job that there should be some pressure
on behalf of the taxpayers to stop that funding of a lifestyle?
PM: Absolutely. I mean let me say this, what we have is a work test. In
other words, they must apply for work and be seen to apply for work
and if they don't and if they don't actually apply for jobs and take them,
they get bumped off and we have review teams that goes through each
Social Security area to see that that is happening.
JC: Yes, well I praise you for that. But, obviously, this is something that
gets through that system or that net.

PM: The second thing is this. In Working Nation, where people are
unemployed 12 months or more, we now give them the benefit of what
we call case management. So one person relates to about 30 people
who are unemployed 12 months or more. So they get to know their
educational standards, their work experience, their aptitude, their
personalities and then after 18 months we offer them a job, but they
must take the job. We give them a job subsidy in case management
that they must take the job. What that means is that anyone who is
unemployed 12 months or more is going to be case managed. So the
possibility of somebody in Nimbin.
JC: Not the whole colony?
PM: Not being known about haven't kept up their credentials under
the work test being case managed, but being unknown to the case
manager, is very unlikely. I have got to say to you, Jeremy, I didn't see
the program, but I would be most surprised in an area where we have
a lot of people who are living an alternative lifestyle, I would be most
surprised that the Social Security regional administration isn't applying
the work test to them. At any rate, I will inquire.
JC: I would be grateful. I think my listeners would be as well because they
were quite upset about it yesterday. Hello, Charles. Charles here is
the Prime Minister.
C: Good morning Jeremy.
PM: How are you Charles?
C: Good morning. I have just got a couple of quick questions. For a start,
in the Budget they increased the cigarette prices, I am not a smoker or
drinker, but why didn't they increase the alcohol because that does
more damage than cigarettes and how do they expect the pensioners
to save for their future when they have just gone and upped the
deeming rate on them?
PM: I am not sure that all the drinkers would agree with you about that, but
anyway. The cigarette and tobacco excise is just one of those things
that the Government has the option of increasing. You know we are
trying to discourage people from smoking because of the health
hazards. We now force companies to publish on the cigarette boxes
and we do think there is some buyer resistance to price and if the price
rises, fewer people are prone to be smoking. The deeming change is
a change in equitable terms to increase the fairness for pensioners.
That is, rather than look at each particular asset they have and deem
the rate to it, what we have done is taken those as a block, given it a
concessional deeming rate and then above a certain figure another
deeming rate and the pensioner groups came out I think after the

Budget and were fairly laudatory of that change, so I don't think you
should fear anything from that. I think you have got a benefit there.
JC: Prime Minister I know you have got to go and I thank you for your time.
There is a question here on the screen that says availability of flags.
We were talking about a kind of Republicanism by stealth yesterday.
Is there something from Canberra that some desire to make the
Australian flag unavailable?
PM: No, we hand it out with alacrity. You can get one at the drop of a hat.
You can get some with a drop of a hat there.
JC: Now you do promise?
PM: Oh, absolutely. The Republic debate takes precedence over those
things. You can still get the flag with the union jack in the corner any
day you want to ask for it.
JC: Alright, okay. Now one last question about Mt isa. Now here we are
with a balance of payments problem and we are looking down the
barrel of a major strike that will cost this country dearly if we can't fix it.
Are you anticipating that you should intervene soon?
PM: Well I think the Minister for Industrial Relations is taking an interest in
it. But it is part of the new enterprise bargaining system. You know
when you hear people like John Howard running around talking about
we need a more flexible labour market, where employers and
employees sit down and work it out. Well, that is what's happening
right up there in Mt Isa at the moment. They have had a more flexible
labour market and they are sitting down working it out.
JC: Well it looks like the whole mining industry is going to go out because
of Mt Isa Mines.
PM: Well because, I think, in the agreement that will come out of it will be a
pacesetter for the industry and that is why there is a lot of interest in it,
but I certainly agree with you on this point, the quicker it is resolved
and they get to an agreement and get back to work, the better.
JC: Prime Minister thank you. You won't tell me when the next election is
going to be? It is going to be soon, isn't it?
PM: If they had certainty of knowledge, it would be a big help to me as well.
I mean even though I have the option of fixing the time, I have always
taken the view that these elections are too hard to win, to give a big
lump of it away. We are going to sort of get our value from it before
we turn in our badge.

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JC: But you will pull it on when you think it is most likely that you will win
and right now it must be very tempting?
PM: Well what I have said is that we will have an election in the cycle and
that means you know when the term, when we are well and truly
towards the end of this term and well we are two years and a quarter.
JC: So you haven't made up your mind or you have made up your mind?
PM: No, I certainly have not.
JC: September doesn't ring a bell?
PM: No, it doesn't ring a bell. I would like to give you a story here, Jeremy
but I honestly haven't got one to give you.
JC: Prime Minister stay well, thank you.
PM: Thank you.
ends

Transcript 9588