Subjects: Australia/New Zealand relations; discussions held in New Zealand; social security arrangement; trade.
E&OE................................
PRIME MINISTER CLARK:
Mr Howard and I have just come from close to an hour of discussion with the New Zealand Cabinet following two hours of bilateral talks in Auckland yesterday. I should say that the Cabinet took the opportunity to convey formally through Mr Howard to the people of Australia our very deep sorrow of the passing away of Sir Donald Bradman and there will be at the commencement of the State Luncheon today observation of a minute's silence for him.
The relationship between our two countries is obviously very close. In these talks we have been able to cover a lot of issues on which our views are similar, and to deal decisively with the social security arrangements which have been an irritant in the relationship for far too long. The specific issues we've covered in the last few days have included the following: the continuing crises in the South Pacific, and Fiji and the Solomons. We have both worked closely together on those issues and we'll continue to do so and we're very pleased to see this year's Pacific Island Forum meeting transferred from Fiji to Nauru. That sends a very clear message to Fiji.
We've discussed our continuing joint involvement in East Timor. This has been a particularly heavy commitment for New Zealand requiring about half of our Army at any one time to be either deployed in, supporting, preparing for or organising on return from East Timor. We've made the commitment however, as has Australia, because of the importance of seeing an independent East Timor succeed within secure borders. The level of our support for the UN force in East Timor beyond May next year will be discussed with both the UN and Australia over the coming months.
We've also discussed the close defence relationship that we have. While in my experience, it is fair to say that for a great many years no Australian government has believed that any New Zealand government was stepping up on defence, nonetheless we have continued to enjoy very very close defence relationships and cooperation and it is that that is very important.
We have discussed trade access to the United States market. Each of us is making approaches to the new Bush Administration about free trade arrangements. So of course are Singapore and Chile, our other partners in the P5 proposal. It's our hope that at some point these approaches might be able to come together. In the meantime we've agreed that our trade ministers and officials are going to liaise closely about our respective approaches.
Now for the new social security agreement. Reciprocal social security agreements between us go back a long way but they have come under very serious strain. In the 1980s as migration flows from New Zealand to Australia increased remarkably Australia became dissatisfied with what it perceived to be an unfair welfare burden placed on it by New Zealand's migrants. In 1989 New Zealand agreed for the first time to reimburse Australia for age and disability support payments for New Zealanders in Australia. In 1994 the reimbursement was extended to single parent and widow's benefit as well. Reimbursement costs have risen from NZ$31 million in '94-'95, to NZ$174 million in 2001-2002. It must be stressed that this reimbursement has never been for the payment of unemployment benefit to New Zealanders in Australia, nor does the new agreement cover unemployment benefit.
Australia estimates that it pays more than NZ$1.1 billion in social security to New Zealand citizens living in Australia. There is a vast difference between that and the NZ$170 million which we currently reimburse Australia for. We do not intend to go further down that road. Our spending priorities must be to attend to the needs of New Zealanders who continue to live here in New Zealand. For that reason the new social security agreement between us will cover only cost sharing for superannuation and payments for people with severe disabilities. This will represent savings over the next 3 years of around NZ$100 million to the New Zealand taxpayer. The New Zealand government is pleased with the outcome and we do believe it is a win-win for both countries.
New Zealanders who migrate to other countries accept that they play by the rules the host country sets. It is up to Australia to set the rules for eligibility for social security for New Zealanders who choose to live there. While the status quo applies to all New Zealanders who have been living in Australia up until today, Australia is announcing new rules applying for new arrivals as of today. The New Zealand government is pleased to be able to reach this new arrangement and put behind us a matter which has become as serious and unnecessary irritant in our relationship with Australia.
Can I draw your attention to the model of the New Zealand Anzac Memorial which is being erected on Anzac Parade in Canberra. It is the gift of New Zealand to Australia on the occasion of the Centenary of Federation. It will be formally dedicated in Canberra on the 24th April at a ceremony Mr Howard and I will both attend and we believe it symbolises the close and enduring relationship which our two countries have had. John Howard.
PRIME MINISTER HOWARD:
Thank you very much Helen Clark. Can I start by saying that again I have welcomed the opportunity of spending two-and-a-half days in New Zealand, of having some extensive bilateral talks with your Prime Minister, meeting a number of senior ministers last night over dinner, and again having a Cabinet session today, and also a meeting with the Leader of the Opposition.
The relationship between our two countries is very deep. It's very long standing. It has substance and merit which transcends the different occupants and different governments that the two countries have over time. And I set it as a priority of mine when I became the Prime Minister of Australia to do what I could to further strengthen the relationship.
I want to endorse what the New Zealand Prime Minister has said about the new social security agreement. It is a win-win understanding. It's the sort of arrangement that you would expected two mature, close allies and friends to come to to deal with a problem that could not, or a challenge that could not, be ignored indefinitely. I think the arrangements are beneficial to both countries. The new rules are fair, they're clear, they're prospective. That's very important - they're prospective. And what they really endorse and underline is that the free movement of people which is so important continues. There's no interference at all with the free movement of people between our two communities. We are establishing some new rules in the future in relation to entitlements linked to the concept of permanent residency. And we think in Australia that that is a fair way to go and we are very pleased indeed that an arrangement which is of benefit to both countries has been concluded in such a sensible fashion. And I thank the New Zealand government and I particularly thank the officials from both New Zealand and Australia who worked so very hard to advise governments and to bring this about.
I wish in this introductory statement to make only one other point and that is to express again the gratitude of the Australian government towards the government and the defence forces of New Zealand for the contribution that New Zealand has made to the deployment in East Timor. It was a very big ask of New Zealand, and New Zealand was very willing at the time of the formation of INTERFET, to offer the support it did and it's been invaluable and I know how much the Australian Defence Force appreciates having New Zealanders by their side in East Timor. And we are conscious of the demand it has placed on the armed forces in New Zealand and we are very grateful for the contribution that has been made. It underlines again the historic value of our partnership and I want the New Zealand people to know how much we appreciate it.
JOURNALIST:
Mr Howard, The opposition party here believes that since Ms Clark come to office the relationship between New Zealand and Australia has actually deteriorated. Can you note or can you comment on that?
PRIME MINISTER HOWARD:
Well I don't want to get into domestic politics. I'll stay out of that but all I can say is that I've had a good relationship with three New Zealand Prime Ministers. I had a good relationship with Jim Bolger, I had a good relationship with Jenny Shipley and I have a good relationship with Helen Clark. And as I say I set out when I became Prime Minister to ignore the political complexions in a government to government sense of who was in office. And I think I've had success on both sides of politics in working together very closely. I think the relationship is in good shape. I don't want to get into grades or any of that kind of business. I'll leave that to you. I'm an advocate, I'm not a commentator.
PRIME MINISTER CLARK:
Let me place on record that although I've only been Prime Minister for some 14 months the advice I have had is that Mr Howard has consistently shown a level of interest and commitment to this relationship which is extremely high. I've found that to be the case myself in both opposition and in government. We've had the opportunity to meet on many occasions and I think the relationship is in good stead because of the commitment he's been willing to make and we've been willing to reciprocate regardless of parties and government.
JOURNALIST:
Could I ask both Prime Ministers - are you assuming that the appeal court decision in Suva on Thursday, will the call for restoration of the 1997 constitution [inaudible] military that they are going to have to go along with that decision?
PRIME MINISTER CLARK:
We're making no assumptions about the outcome but the ideal outcome would be the one that you have speculated on. And the ideal response will be for the Fiji government to indicate that it would fully accept such an outcome
PRIME MINISTER HOWARD:
I agree with that completely. I wouldn't presume recognising as I do the doctrine of the separation of powers, I wouldn't want to express a view on what the court might decide. I would express a view though on what the response of the authorities in Fiji should be and that is complete obedience to what the court decides.
JOURNALIST:
Prime Minster, are you getting mixed messages from the Fiji military?
PRIME MINISTER HOWARD:
Me? Oh look I'm not..there's nothing to be gained by my saying more than what I've said. That doesn't help anything.
JOURNALIST:
Mr Howard, in terms of trade issues, can you confirm that because New Zealand have a very strong defence relationship with the Americans that that actually gives you a much better chance for a positive result?
PRIME MINISTER HOWARD:
My experience with governments when it comes to trade matters is that they look to the national interest and they are relatively unsentimental. And therefore I think what will matter in our discussions with the United States is whether there's mutual benefit. I am cautiously hopeful that there may be a different attitude from the new administration and the early signs are at least they're very happy to talk. But I think we have to be realistic. For Australia to make any real progress on that front with the United States we'd need significant movement on agriculture. That's still alive in the American domestic political context. A live issue, let me put it like that at the very least. But I see it very much as something that's going to be governed by trade considerations.
JOURNALIST:
Have you got any time set for the meeting with Bush's Administration?
PRIME MINISTER HOWARD:
Well I think there are some preliminary discussions going on at an official level but it's too early for me to be saying anything more than that. And can I just say that we will talk on a very regular basis with New Zealand about this and it's important that we each know how the other is doing and exchange notes and keep the other very closely informed. But in the end these things are hard headed trade bargains.
JOURNALIST:
Mr Howard on the welfare issue, with almost half a million New Zealanders living in Australia and most of them contributing to the tax base, it could be argued that we contribute more in fact than we take out of it through benefits. So why do we owe you anything?
PRIME MINISTER HOWARD:
Well some might argue that. I don't think that is necessarily a totally accurate construction. I think it's not unreasonable of a community such as Australia to say we continue to welcome your people, we will make prospectively some changes which simply say you are in relation to matters of permanent residency in the future to be like other people you have the advantage of coming without let or hindrance but like everybody else you have to meet the qualifications of permanent residency in order to get benefits. Now I don't think that's unreasonable at all. They could still leave a very significant margin of benefit for New Zealand citizens.
JOURNALIST:
Mr Howard how do you respond to suggestions that the Australian policy could be seen as inherently racist, and that the people that it would look at stopping coming in, say Pacific Island migrants coming to New Zealand and then going on to Australia which [inaudible]? Some commentators have said that is maybe a racist policy?
PRIME MINISTER HOWARD:
Well that's preposterous, even offensive.
JOURNALIST:
Mr Howard, I was just going to ask how do you think that Australians back home will view this announcement?
PRIME MINISTER HOWARD:
I think Australians will see it as a sensible arrangement which is beneficial to both countries and the sort of arrangement they would expect close friends to conclude.
JOURNALIST:
Has it been a sort of angst [inaudible] for Australians..?
PRIME MINISTER HOWARD:
No angst is not the right word. It's just one of those things that people believe should be dealt with in a measured, sensible, fair, reasonable way and that's what's happened.
JOURNALIST:
Ms Clark have you received any advice formally against this agreement?
PRIME MINISTER CLARK:
Have I received any advice warning me against it? If I have I haven't heeded it and I really can't recall whether I have. I mean we could not carry on as we were. I've set out the figures for you. Australia pays NZ$1.1 billion in social security to New Zealand citizens a year. We reimburse NZ$170 million, none of which was ever directed at the unemployment benefit. If we are to stand here as the New Zealand government and insist that Australian taxpayers pick up the tab for that missing NZ$800 million odd, it's pretty obvious what the request from Australia will be. That's why I said we did not intend to go further down that path. We have negotiated the new agreement which is fair, which is sustainable, and sends a clear message to Kiwis that when you go overseas you can't expect nanny state to accompany you where ever you go from New Zealand. You live by the host country's rules.
JOURNALIST:
Mr Howard, what do you think of the New Zealand War Memorial that's going on Anzac Parade.
PRIME MINISTER HOWARD:
I think it's...I haven't had a lot of opportunity to observe it. From what I see I think it's very distinctive.
JOURNALIST:
As either an architectural advocate or commentator, how do you think it will set off Anzac Parade?
PRIME MINISTER HOWARD:
Well I'm not qualified to be an advocate and I know the perils of architectural commentaries. One of my predecessors demonstrated that.
PRIME MINISTER CLARK:
Perhaps we should seek the views of Prince Charles.
PRIME MINISTER HOWARD:
Indeed.
JOURNALIST:
On the social security agreement can I ask the both of you why does it need approval of the two parliaments and have either of you got any indication that it won't get there?
PRIME MINISTER CLARK:
There will be some minor legislative change to put the agreement into operation. It will be the kind of technical change that followed for example the signing of the Singapore trade agreement. So we haven't as yet canvassed with other parties their reaction. But I would think that other parties in Parliament would want to look at it carefully, bear in mind the savings to the New Zealand taxpayer and bear in mind the alternative which would be to insist on Australia meeting obligations to New Zealanders would carry an even larger bill than we've ever contemplated.
JOURNALIST:
Mr Howard are you happy with New Zealand's immigration policies [inaudible] for a common border?
PRIME MINISTER HOWARD:
Am I happy with New Zealand's immigration policy? Well I normally take the view that New Zealand's immigration policy's a matter for New Zealand.
JOURNALIST:
So in that case would you prefer to see a common border between the two countries as far as...?
PRIME MINISTER HOWARD:
Well I think the present arrangement's fine.
JOURNALIST:
On the subject of closer economic relations - do you have a view at all on the stock exchange talks collapsing?
PRIME MINISTER HOWARD:
Well I understand some of the reasons for them not so far being successful based on a belief by some people in the stock exchange here which resists demutualisation. I know the New Zealand government is in favour of demutualisation because our stock exchange demutualised some time ago. I would like to see the discussions recommence at some time and it would make a great deal of sense. I think there's benefit once again on both sides of the Tasman for it to be put back on track. But I mean it is a matter ultimately for the people who control the two exchanges. We don't instruct free enterprise crucibles such as stock exchanges to behave in a particular fashion.
PRIME MINISTER CLARK:
That's absolutely right. I'm on the record as saying that I think the two economies will continue to harmonise closely and at some point someone's bound to look at the stock exchange issue again. But in the end the stock exchange is owned by its members and they make a decision. What their view might be at some future point is very significant. Companies listed on the New Zealand exchange would shift the listing to Sydney we can only speculate upon. But right now the exchange is not of the mind to proceed and the issue lies dormant.
JOURNALIST:
What has the Australian government decided to pursue a free trade agreement on its own rather than with New Zealand?
PRIME MINISTER HOWARD:
Well we think in relation to both countries that, that's both New Zealand and Australia that is, that it's marginally more likely that you will get some initial breakthrough if it's done on a bilateral basis in each case with the United States on the understanding that we keep each other very closely informed. And as the New Zealand Prime Minister said we don't in any way rule out or set our face against the notion that if we did make some progress then that could be the basis of a broader understanding. I mean it's going to be very hard for..[inaudible] easy for either of us to make progress. And we think there's marginally more flexibility handling it in this way than trying to manage a joint approach at every turn given that there will be some issues were what is of benefit in what the United States might give up to Australia may not be of the same level of benefit to New Zealand and vice versa.
PRIME MINISTER CLARK:
It is hard to make progress because of the strength of the agricultural lobbies and as Mr Howard and I have discussed New Zealand of course has the dairy industry very much to the fore. Australia on the other hand has wheat and beef rather more to the fore than dairy. It may be that through the separate paths we make breakthroughs respectively. We'd like to see it come back together in a five way deal at some point if we can. But right now we'll keep closely in touch and have our own representatives making the approaches.
JOURNALIST:
The interpretation put on your comments this morning that your looking at doing away with the sky hawk fleet next year. Would that be a fair interpretation?
PRIME MINISTER CLARK:
Not of anything I said this morning. What we've been saying for about the last year is that there is an open question. There have been reviews going on. We didn't proceed with the F16 purchase but that's something for the Cabinet to return to at some point.
JOURNALIST:
How would you feel about that Mr Howard?
PRIME MINISTER HOWARD:
Well individual defence decisions concerning New Zealand are a matter for New Zealand. I've been asked this question repeatedly. I mean those decisions are matters for New Zealand.
JOURNALIST:
Can we be incompatible though?
PRIME MINISTER HOWARD:
Well look, you know, I've given my answer. It's a matter for New Zealand.
JOURNALIST:
Mr Howard, do you share the views of your colleague Mr Hockey that the advent of a Labor government would be bad for the Australian dollar and bad for Australian security?
PRIME MINISTER HOWARD:
Well that's a profoundly provocative and domestic political question which I will address when I return to Australia.
[ends]