E&OE..............................................
CORDEAUX:
Sir, good morning.
PRIME MINISTER:
Good morning Jeremy. Good to be with you again.
CORDEAUX:
Happy anniversary. This is the, what? The anniversary of 24 years.
PRIME MINISTER:
Yes, I was elected to Federal Parliament 24 years ago today, of
the election held on May the 18th, 1974. That was an election in
which Gough Whitlam was the Prime Minister and he was returned.
The late Bill Sneddon was the Leader of the Opposition, and it was
pouring with rain in Sydney. It was a very wet polling day and it
was pouring with rain. A lot has happened in that 24 years, a lot
has changed. A lot has not changed. I remember only a few months
after I was elected to Parliament there was a report brought down,
commissioned by the former Coalition Government, the previous coalition
Government, and it recommended fundamental reform of Australia's
taxation system as being in the long-term interest of the Australian
economy. And interestingly enough, not much has changed with the
Australian taxation system since that was introduced. Now while
during that, almost a generation of political and social activity,
an enormous amount has changed. For example there were hardly any
women at all. I think there was only one or two in the House of
Representatives when I entered it in 1974. Now thankfully, there
are a very large number of women, particularly on our side as a
result of the last election and there have been numerous other changes.
One thing we haven't really come to terms with and come to
grips with in this country is the need to fundamentally reform our
tax system. That is a big issue now as it was 24 years ago.
CORDEAUX:
Well, one year later in 75 and all that kafuffle about the
Senate overruling the authority of the House of Representatives
and yet Kim Beazley is really predicting the same sort of thing.
That if you get re-elected, he is going to oppose that tax package
in the Senate.
PRIME MINISTER:
Well it's a mixed - the metaphor is he really wants to make
the unrepresentative swill the cock of the walk, he really does.
I mean this is the group of people that his predecessor and him,
by implication, derided. But what he's really saying, and incidentally
I don't deride the Senate, it's a legitimate important,
fundamental part of our political system. It was the Labor Party
who derided the Senate. But he's really saying is it doesn't
matter what the Australian people decide at the next election, we
the Labor Party are more important and we the Labor Party know better
than the Australian people. We will going to the next election with
a set of policies and if those policies are part of what we put
to the Australian people and the Australian people vote for us and
vote for those policies, we are entitled as a result of that, if
we win, to have those policies put through the Parliament. But no,
that's not good enough for Mr Beazley. He's arrogantly
saying to the Australian people, I don't care what you say,
I will have my way whether you like it or not. Now this is arrogance,
this is really born to rule mentality.
CORDEAUX:
But it seems like such a funny position to take.
PRIME MINISTER:
Well it's a crazy position to take and it's quite opposite
to what he said a few months ago he was going to take. Perhaps he'll
change again if he doesn't win the election.
CORDEAUX:
Well, it was said this morning that the tactic was probably to
smoke you out with the tax package a little bit early.
PRIME MINISTER:
No no, we smoked ourselves out. We said we were going to go to
the election with a tax package. We will unveil it and that tax
package will contain significant personal income tax cuts. There
are a lot of reasons why we should have a comprehensive reform.
One of the great arguments in favour of a broad based indirect tax
or a GST, call it what you may, is that it makes it much harder
for the cheats to avoid paying their fair share. People resent the
present system. Because a lot of people don't pay their fair
share. If you have a broad based indirect tax instead of the existing,
lumpy, very discriminatory wholesale sales tax, you catch a lot
of the cheats. A lot of money now that now slips through the net,
under the fence. It doesn't do so under a broad based indirect
tax regime. The black economy is smaller under an indirect tax regime.
The cheats don't like the sort of reform that we have in mind
yet Mr Beazley apparently is trying block it.
CORDEAUX:
Would you agree that the key thing is going to be in selling it.
I see that there's a poll out this morning, not a terribly
big one, but there is a poll. It says that most people, over 50%
believe that they'll be paying more under a GST.
PRIME MINISTER:
Look, Jeremy, could I stop you for a minute by saying, if you put
a GST on top of the existing system, of course you're paying
more. But we're not going to do that. I mean nobody's
going to do that. If we bring in a broad based indirect tax, or
GST, we will abolish existing indirect taxes. Of course we will.
We're not going to put a GST on top of the existing system.
CORDEAUX:
So again....
PRIME MINISTER:
It depends on the question that gets asked. If somebody says to
me "Are you in favour of a GST on top of the present system"
my answer would be no.
CORDEAUX:
No, and the other thing is that you made the point last week about
those people who are battlers, or people who are disadvantaged...
PRIME MINISTER:
They're not going to be hurt. Now I did not come down in the
last shower politically nor am I insensitive to the need to look
after the under-privileged. And there is no way that we're
going to produce a package that hurts the poor. We're not going
to produce a package that isn't balanced, and we're certainly
not going to produce a package that does not contain significant
personal tax cuts for people in the low and middle income brackets.
But this country is crying aloud for tax reform and all the Leader
of the Opposition can do is to say no, no, no. I mean, we know what
he's against, we don't know what he's for. Is he
for anything? Is he just a carping negative whingeing opportunistic
Opposition Leader.
Now I have waited for more than two years to sort of speak in these
direct terms about his policy position. I accept that when you first
go into Opposition after you've been in power for a long time
it takes a while to sort things out and it's a bit unreasonable
to ask a Party that's been in power for a long time to remake
itself within the space of a year or 18 months. But he's now
had more than two years as the Opposition Leader and its about time
Mr Beazley told the Australian public what he believes in, what
he stands for, what he wants to do, as distinct from saying that
all he believes in is what we, is opposing what we stand for. All
he wants to do is to stop, is to hinder and obstruct. And I think
the Australian public are fed up with that. They want to know what
he believes in and then they can make an informed choice.
CORDEAUX:
I suppose the problem is that, four o'clock in the morning
or something like that, when you're waking up and your mind
goes back to 1993, I mean it would be understandable to be very
nervous about this considering the difficulty that some people seem
to have in explaining or selling the advantages.
PRIME MINISTER:
But Jeremy, in a sense that's all the more credit that we
should receive for having the courage to undertake it.
CORDEAUX:
Well, you know where I stand. I mean, I think shortly after you
became the leader of the Party, I was saying when you do get into
office, you will be reforming the tax system.
PRIME MINISTER:
Well we have to reform the tax system.
CORDEAUX:
I agree with you.
PRIME MINISTER:
I mean, we fixed the financial system, and we're trying to
reform the industrial relations system, we got the Budget under
control, we've given the country the lowest interest rates
for 30 years, we've essentially fire-proofed the Australian
economy against the Asian down turn, but there's one great
piece of unfinished economic business and that is we need a modern
competitive tax system. Because that's in Australia's
interests. It will help our exporters, it will make us more competitive,
it will take the burden off low and middle income workers, and it
will stop the cheats. Now there's an overwhelming case. Now
I know it's difficult. And I know people can run fear campaigns
and I know people can be negative and say, oh no some time but not
now. If we are ever going to do it it's now. We have low inflation.
We have the clear evidence of the need to be competitive in our
part of the world. We have a greater maturity within thinking circles
in the Australian community about the need for it. We even have
the welfare sector talking in quite a constructive fashion. I'm
not discouraged by what ACOSS is saying. ACOSS is concerned about
the core.
CORDEAUX:
Well, if you could just get the ABC on side, I think you'd
have the whole thing licked.
PRIME MINISTER:
Look, let's just say, I'll have another drink of tea.
CORDEAUX:
Let me say this though, that with that mandate that you acquired
when you were elected, I think it was a mandate for change. Now
what happened in the earlier stages was a certain amount of frustration
that not enough was happening. I mean if you go back to the people
with a demand for the right, and even if you've got to do it
a couple times I suppose, the right to reform the tax system, the
industrial relations system, and all the rest, I think you will
have them standing in the aisles clapping.
PRIME MINISTER:
Well Jeremy, I hope so but that ultimately is for the Australian
people to decide, not for me.
CORDEAUX:
But if you didn't get the Senate and it looked like everything
would just be stalled, you know you'd been given the job but
you haven't been given the right to do the job, you would keep
going back I take it.
PRIME MINISTER:
Well look, I don't want to start speculating about when the
election after the next election is going to be held. That's
a bit silly. I'm focused on winning the next election whenever
it is held. But I just simply make the point that if you have a
situation where a Government goes to the people with a clear detailed
policy. A policy which people might see as being in the long term
interest but they recognise is politically difficult and a bit risky
and we win that election, but not withstanding that, the Labor Party
says unless we control the numbers in the Senate, we're going
to stop you implementing what you said you were going to do. I just
think that is thumbing your nose at democracy. That is saying to
the Australian people, we know better than you. We in the Labor
Party arrogantly believe that our view is superior to the view of
the majority of the Australian people. Now I can't think of
anything which is a greater denial of popular democracy than that.
I mean after all we are meant in a democracy to listen. Governments
lose office when they don't listen to the people. Can I say
to Mr Beazley, Oppositions lose respect when they don't listen
to the people.
CORDEAUX
Prime Minister, we're looking at the death throes of the Soeharto
regime pretty obviously. Are you at all worried about what may come
afterwards?
PRIME MINISTER:
I am worried overall about what is occurring in Indonesia. Indonesia
is a very important country for Australia. Very important indeed
and our links with Indonesia go beyond our links with any particular
regime or any particular government and my concern is that restraint
be exercised. I do want to see more democracy. I also recognise
that you're not going to get an overnight transfer from one
political system to another without an enormous amount of upheaval
which may involve a great deal more grief and a great deal more
social dislocation than what we have already seen. I just hope that
the situation in Indonesia can be managed in a way that there is
maximum preservation of life and maximum economic stability but
Indonesian people are going through a hard time and Australia should
be, as it has always been, a very good friend and a country that
is willing to help, a country that is willing, if asked for, to
give advice and a country which is willing all the time to be arguing
for change but arguing in a way that our arguments are listened
to.
I noticed at the weekend that we were being given a bit of advice
by the Opposition. Now, it's very easy when you are in Opposition
to give that sort of advice. I suppose all Oppositions give that
sort of advice, but I don't think anybody suggests that when
the Labor Party was in power that Mr Keating was other than very
close to President Soeharto, in fact, probably of all Australian
Prime Ministers, most would say he was even closer to him than his
predecessors. I don't think it's a question of whether
you are close or not close to Soeharto. It's a question of
whether you care about Indonesia's future or whether you care
about the relationship between the two countries, and I do, and
my aim is to have a relationship with Indonesia which is irrespective
of whether somebody or other is in power in that country.
CORDEAUX:
Would you be tempted to link aid and support to perhaps a rethink
on the part of the Indonesians with regard to East Timor?
PRIME MINISTER:
We have taken the view up until now, and so indeed did the former
Government, that the best way that we can bring about change in
Indonesia's attitude towards East Timor is to encourage and
persuade and to use the close relationship we have to bring about
gradual change. Indonesians in the past have been reluctant to take
kindly to public advice and public hectoring in relation to East
Timor and those countries that have tried to do it have been monumentally
unsuccessful in bringing about change. I mean, I don't notice
any evidence over the past few years that those that have said to
Soeharto and others, you do this or you do that in relation to East
Timor and have done it publicly I...
CORDEAUX:
But you don't think it might be a good time to urge a rethink?
PRIME MINISTER:
I would have thought that at the moment there are things higher
on the list of priorities of the Indonesian Government than East
Timor.
CORDEAUX:
They've got their plans to defend the Australian dollar. I
see this morning they're talking about a 60 cent dollar.
PRIME MINISTER:
I don't talk about the level of the dollar except I will make
this point, that people seem to have overlooked the fact that the
Australian dollar against the trade weighted index, that's
the basket of all of the currencies with which you compare the Australian
dollar and it has not really gone down much at all in value. It's
a fall, it's not actually a fall against the American dollar,
it's just that the American dollar as a result partly of what
is happening in Asia, the American dollar has gone up. So when you
look at the Australian dollar versus the yen, the deutschmark, the
pound and all the other currencies that are in the basket of currencies
with which our currency is measured, the Australian dollar is doing
very well indeed. Our economy may be geographically in Asia but
economically, it's a thousand miles away because it's
much stronger.
CORDEAUX:
The interest rates, what steady?
PRIME MINISTER:
The interest rates in Australia are the lowest they have been for
30 years.
CORDEAUX:
Yes but in real terms with inflation so low, they are still pretty
high, aren't they?
PRIME MINISTER:
Yes but gee, they are much lower.We haven't had these interest
rates for small business and homebuyers for 30 years which is a
tremendous achievement.
CORDEAUX:
Yes but do you see interest rates coming down a bit, steady as she
goes?
PRIME MINISTER:
I don't want, once again, I don't really want to speculate
about their future development. I notice that the Governor of the
Reserve Bank made some remarks about interest rates a couple of
weeks ago, suggesting that in his view they were likely to remain
virtually where they are for some time. Now I simply draw people's
attention to that. I will neither endorse it nor dissociate myself
from it.
CORDEAUX:
Prime Minister, have you seen this story about, I've got no
idea who gave them permission, but the Royal Australian Mint in
Canberra is already working on new designs for a currency change
to coincide with the republic?
PRIME MINISTER:
I saw the story. I don't know what the source of the authority
is if it occurred and I have got to say that it's a little
premature.
CORDEAUX:
Will you be inquiring?
PRIME MINISTER:
I will actually. I'm not here to make a big deal about it and
if the explanation is look, we plan years ahead and we have all
sorts of contingencies and so forth, and why shouldn't we,
maybe that's reasonable. But I simply make the point that this
is for the Australian people to decide. I am a little surprised
but I am not, at this stage, prepared to be critical unless I know
what the background is. People are often accused in Government of
not preparing for the future and when they do, even though that
particular future may not occur, it's a bit rough to sort of
come down on them like a tonne of bricks.
CORDEAUX:
Yes, it sort of looks a little partisan on the side of the issue
though?
PRIME MINISTER:
This issue will go to the Australian public and it will be resolved
at a referendum next year and until then, obviously the present
system remains and it may well be that as a result of the vote at
the referendum next year, the present system will be endorsed.
CORDEAUX:
Now the networks are already jockeying to get the right to do the
election debate. It seems Channel Nine is in the front running for
that and it seems that, you don't seem to have a lot of confidence
in the ABC's ability to be unbiased. Is that putting too sharp
a point on it?
PRIME MINISTER:
I said the other day when I was asked about this that I would allow
the Federal Director of the Liberal Party, Lynton Crosby, to do
all the negotiations on this. If there is to be one of these debates,
we want it to be fair and balanced. I thought Channel Nine ran the
debates before the last election pretty well. It doesn't mean
to say that they are going to get it this year. I will leave that
to Lynton Crosby. I am not going to spend the next three or four
months, or whatever the period of time is, or six or eight or two
weeks or whatever, don't take any notice of that, but debating
the format of the election debate.
CORDEAUX:
Yes, yes but it just strikes me as strange that the national broadcaster,
the national broadcaster should absolutely be unbiased and if the
government of the day doesn't have faith in that position,
I guess it begs the question, why don't you do something about
it?
PRIME MINISTER:
The ABC operates under a charter and if the Government has a problem
with anything that the ABC does, the Government puts its view to
the ABC. Now I have a lot of respect for the ABC. It think it's
a great Australian institution. I also have views on occasions about
the breadth of its objectivity or its vision when it comes to the
coverage of certain political events. Now that's no secret
and I am not reluctant to express my view publicly and privately
but we had views that we put at the time of the discussion concerning
the debates before the last election and those views were soundly
based but what happens for the next election is something that,
so far as the Liberal Party is concerned, I will leave in the hands
of Lynton Crosby. I am sure he will do it very well.
CORDEAUX:
Prime Minister, could we take a couple of calls. Trevor.
CALLER TREVOR:
Yes. Good morning Prime Minister. Thank you very much for allowing
me to speak to you. You may have just partially answered a couple
of questions that I had wished to ask but before I ask those questions
I have to actually give a bit of background to frame them so I can
put them in the proper context.
CORDEAUX:
Be quick, Trevor.
TREVOR:
Right. The Australian savings have fallen dramatically since 1972
which is inversely proportional to inflationary policies pursued
by the success of the Australian Governments, but mostly being Labor.
Inflationary policies the Government had, this saved the printing
of money and therefore reducing the spending power of existing savings.
CORDEAUX:
What's the point, Trevor?
TREVOR:
Allow me just a moment.
PRIME MINISTER:
I think I know what the point is. I have heard this one before.
TREVOR:
No, well the older people, these are the people who have suffered
because, you know,