STEVENS: Good morning Prime Minister Rudd. Welcome to Mackay.
PM: It's good to be back in Mackay. It's terrific. I've got to say I was up here in February in the floods and it's good to see that so much progress has occurred now in recovering from the flood. Although I still understand there's a lot of work to be done.
STEVENS: And where are you this morning?
PM: At the Mackay Marina, and I've got to say, it's stunning. Having flown out of Canberra and Sydney in recent days, this is a beautiful part of the world. People living up here you all know you're in paradise, but those of us who visit know you are.
STEVENS: We need you to visit more often.
PM: Well, twice since I been Prime Minister and I've only been Prime Minister for six months and I think I was here a couple of times last year as well. But this time I brought the entire Cabinet.
STEVENS: So tell me why is it important to bring the Community Cabinet to Mackay?
PM: Well, it's like this - it's a new way of governing in Australia whereby we bring the Cabinet to the people. The National Government has never done this before, and we think it's the right way to go. This is the fourth one we have done in six months. We've been so far on the outskirts of Brisbane, we've been in Perth in Western Australia and we've been in Western Sydney.
We're here in Mackay, yesterday, and we have a further regular Cabinet meeting here in Mackay at the city council chambers today. And this is part and parcel of providing the local community with an in your face opportunity to put to members of the Cabinet any question they've got. And if you're a community organisation to then have an opportunity for an hour or so to sit down with individual appointments with Ministers about your particular concerns.
So, we think it's the right way to go and we got a whole lot of interesting proposals from people here yesterday.
STEVENS: So what did you take out of some of the questions you were addressed with yesterday?
PM: A lot of concerns were raised about the affordability of housing here in this region. Obviously off the back of the mining boom, and other needs. The Housing Minister who's with us Tanya Plibersek has been talking with local community organisations and the council about that. We have a national housing rental affordability fund which we may seek to deploy in this region, but the details of that will be sorted out with her.
We also, of course, received many representations about the needs of local roads including the Peak Downs Highway. And on top of that of course basic concerns about costs of living. Particularly people's concerns about the concentration of supermarket power.
STEVENS: Obviously we're going to talk about housing affordability. It's not something that we're proud off that we're the sixth least affordable in the country. What solutions can we expect?
PM: We've been in Government for six months and it's a bit hard to turn things around having had our predecessors in office for 12 years. When we took over in Canberra, their previous Government did not even have a Housing Minister. We now have one and that's Tanya.
And since then we've announced three new plans coming to more than $1.5 billion.
One is to provide assistance for first home buyers through first home saver accounts. Whereby, if they save money on their first deposit, we provide them with preferential tax treatment so that they can accumulate a deposit earlier than would otherwise be the case. That's for first home buyers.
Secondly, there's a new fund which we've established which deals with local government infrastructure charging on new developments. Often when people go out to buy a house in a new housing development there is a real problem in terms of the amount that's loaded on to the house price from new infrastructure development. That is, not just curbing and channelling but also often additional community infrastructure as well - adding 50, 100 and sometimes $150,000 to the cost of a house.
What we've done is said we will partner with various local authorities around the country to bring down those infrastructure charges on new developments by as much as 20 per cent. Now, again the Housing Minister will decide in partnership with various local authorities around the country which ones we can work with, and on what projects, but we intend to have a go at this.
And the third one is rental affordability. And people in rental accommodation, particularly who may not be here for a long time, it's a real problem in terms of getting access to affordable rents, and that's why we have got a half billion fund for this as well. To co-invest, effectively, with private developers in new affordable rental accommodation whereby a proportion of the new apartments would be at, say, 20 per cent less than the normal market rent.
These are three new programs we brought in. They don't solve the problem, but they represent a step forward.
STEVENS: Prime Minister, you did mention people who aren't going to be here for a long time. That remains one of our biggest issues, because of the affordability, its hard to attract doctors, teachers and police for the region and then keep them here because they come, they realise how unaffordable it is and then tend to move on. Could specialists be offered tax relief to live in the region?
PM: The Health Minister is in discussions with her state counterparts at present, that's Nicola Roxon, who was here yesterday and today as well about the particular needs of rural and regional Australia. I'm sure she'll take that matter up further with the local authorities here as well.
Part of the underlying problem we've got is this: we had a period back there in the 90s where we just weren't training enough people through the universities, particularly doctors and particularly medical specialists, and the flow through effect of that decade later is terrible.
The previous Government really dropped the ball on this big time and now we're paying the price for it.
We're trying to turn things around, it will take time and it's very difficult in six months, which is how long we've been in office, to turn around problems which have been accumulating for the last decade.
But you're right, this is a problem. Last night at the civic reception I attended down at the surf club, local representatives of a couple of the local hospitals, the Mackay Base and the private hospital, told me about the particular problems which now exist in terms of orthopods. That's a real problem. But the Health Minister will do what she can, in partnership with her state colleagues, to try and turn this around. But it's not easy.
STEVENS: The other people it really does affect is pensioners, they voiced their opinions on their situation yesterday. Luckily you were spared the same sort of protests we saw in Melbourne. They are particularly suffering in this area, what can be done?
PM: Well, pensioners and carers are doing it tough and that is why in the Budget, we have introduced a substantial $5.1 billion increase in what is called the carers and pensioners utilities allowance. In the past that was $107 a year and now that has been increased to $500 a year. That costs us $5.1 billion, that is one step.
We will also be examining the long term redesign of the retirement income system through what is called the Henry Commission of Inquiry. That is under way through the Secretary of the Commonwealth Treasury at present.
But that $5.1 billion investment is not only new in the utilities allowance, it is also continuing. So that is one measure designed to assist pensioners and carers right now.
STEVENS: When do you expect we will see the results of that inquiry?
PM: It is not due to report until the end of next year because it is totally related to the tax system, the income support system and the retirement income system. We have not had a root and branch review of the total system until, for about the last quarter of a century.
But on the particular question of pensions themselves, of course we expect an earlier report in the first quarter of next year. The Henry Commission will deal with the totality of tax, income support, retirement income, and it has got this spread of review activity which goes out from now until the end of next year but because retirement income is so important, then we expect a report in the first quarter of next year.
STEVENS: I spoke to the mayor of the Mackay Regional Council Col Meng earlier this morning, he suggested that you were going to make an announcement that could effect the future of Mackay. Can you give me more details of that?
PM: Well that's nice of Col to say so.
STEVENS: Well I guess we are hoping.
PM: I had a good chat with Col yesterday about local needs, and it is quite plain that you have got big challenges here in the area. But if I could just make one point about the flow through effect of what happens with the big changes to the tax system, the childcare tax rebate which flow from tomorrow the 1st of July. I mean if you are a young family, a typical young family with a child at preschool and one at school, then because of the changes to income tax, the education tax refund and the childcare tax rebate, then on average we would expect some, a family such as that to be $52 a week better off.
The education tax refund - right here in Mackay in this region, there are some 15,000 students in Mackay in the region who would be eligible to claim this refund. And that will provide a total benefit across this region of up to $7.5 million a year.
The childcare tax rebate, about 7000 children in the Mackay region would be eligible for that in terms of their being within the age bracket for which the childcare tax rebate applies and that goes up from 30 per cent to 50 per cent for out of pocket childcare costs up to $7500 a year.
Now all those start flowing from tomorrow and other things like the teen dental program as well, which will provide a $150 voucher for an annual dental check and about 5000 young people in the Mackay region who would benefit from that.
All these measures are national measures but they apply to very large groups of people here in this region as well.
STEVENS: What about the suggestion that childcare centres are raising their prices since this rebate came in effect?
PM: Well we have seen some evidence of that around the country and no one wants to see childcare costs jacked up artificially.
And the Deputy Prime Minister has already indicated her concern about any excessive increases. But there have of course increases in previous years. Our response to that has been to make sure that this has been a substantial increase in the childcare tax rebate and therefore provide a substantial additional benefit to working families under financial pressure.
We cant guarantee the cost or price outcomes in any individual childcare centre but we at least want to be doing our bit to make sure that we are making it easier to cope with financial pressure.
Also under the previous government the average fee for a child in full time long day care increased by almost 80 per cent. So price increases are not new. But this is a very big increase in the childcare tax rebate.
STEVENS: The mayor, while we are talking about mayors, the mayor of the Whitsunday Regional Council has addressed the issue of infrastructure for Abbot Point. Is there the chance that the Government may be able to help out? Obviously in turn securing the investment of Chalco in the region.
PM: Well the Mayor had a good conversation with me yesterday about the particular needs at Abbott Point and certainly the people from the region should be congratulated for their success so far with their negotiations with Chalco.
What I agreed with the mayor yesterday, is that in the coming months that Minister for Infrastructure Anthony Albanese would sit down with him to work out what we could do in partnership with the local area. I don't want to pre-empt any of that because this is a very large scale investment. You have got to be very clear cut about where responsibilities stop and start between the Federal Government and the State Government and the private developer.
But as I said in my earlier remarks, we want to be partners with local authorities and we will work with them to the greatest extent that we can.
But they should be congratulated for the great success they've had so far in terms of achieving the status they have with Chalco in what, I'm advised, stands to be a $3 billion plus investment.
STEVENS: We've mentioned the fact that you've already, you've spoken to two of our regional Mayors, Whitsunday Regional Mayor Mike Brunker and Mackay Regional Council Mayor Col Meng. Has the recent amalgamations across this state made it easier for you to have contact with local council representatives?
PM: Oh look, whenever I've travelled before, either Leader of the Opposition or now as Prime Minister, I always make a point of linking up with the local authorities wherever I am. And I don't think it's easier or harder, that's a matter for local people to sort out. And I know that's been a controversial process with the State Government.
Also, you mentioned local Mayors. Apart from the Mayors of Whitsunday and Mackay Region, I also caught up briefly last night at the function with the Mayor for Burdekin. So we had a good general discussion about the range of local authority needs in this area, focussing not just for example, on the Abbott Point proposal, but broadly the infrastructure needs of the wider region.
STEVENS: Also, how much can you tell me about the emissions trading scheme which is supposedly releasing more details on today?
PM: Well, we aren't releasing further details on that today. We have a long term process of developing our policy in this very complex area.
Essentially it's this - climate change is real. International scientists through the United Nations panel have agreed that it is real and it is happening. And the economic costs of inaction are far greater than the economic costs of action.
What the scientists tell us, that if temperatures continue to increase we're going to face large scale bleaching of the Barrier Reef, the loss of up to 80 per cent of the wetlands in Kakadu, extensive droughts across south-eastern and south-western Australia, a large impact on agriculture, large impact on tourism. All these are economic costs.
So, the argument we put as the new Government of Australia is you either stick your head in the sand and hope that it all goes away, which is what the Howard Government did, or you can act, and act in partnership with Governments around the world.
And in acting, it requires us working at multiple levels. Global negotiations, that's why we've ratified Kyoto, so that we can be around the negotiating table with other Governments.
Secondly, on top of that also acting in particular areas like boosting the mandatory renewable energy target so that solar has a bigger role the play in the future. As well as introducing an emissions trading scheme. And on the emissions trading scheme, we will in due course be releasing a Green Paper which outlines some of the Government's thinking on how this should be unfolded. It will be a tough area of policy, but it's a necessary area of policy to bring about longer term, an economy in Australia capable of dealing with a lower carbon world.
STEVENS: Obviously we're aware of the importance of the coal industry throughout this region. Do you have to tread carefully not to step on the toes of that industry?
PM: Well I'm a Queenslander, I'm a big believer in coal. And, this is Australia's largest coal producing state and Australia is the world's largest coal exporter.
That's why the Government, for the first time in the nation's history, has established a half billion dollar national clean coal fund. And from that fund already we are participating in projects aimed at bringing on stream large scale clean coal power generation plants over time.
We've got to take this new technology of clean coal from the laboratory, commercially apply it, in power stations at scale so that the world can see that this technology is capable of being commercially applied.
And we have hit the ground running with this. A half billion dollar fund. I think it's really important. We need to be part of the global solution when it comes to the future of coal, not just part of the problem. And that's why we have got our shoulder behind the wheel with this large investment.
So I'm an optimist about the future of the coal industry. And it's part and parcel of the long term solution of dealing with the climate change challenge.
STEVENS: Prime Minister, I must say, you sound very relaxed the morning. Obviously the Mackay Marina works for you?
PM: It's a fantastic part of the world. It is just stunning - it's stunningly beautiful up here. Flying in on the plane and just looking at the cane fields and what has happened in terms of local development and out to the Whitsunday's, this is an extraordinary part of the world. And people who live here, I think you know you're in paradise. Those of us who visit it certainly know you are.
STEVENS: We do, we love the area, and we're glad to have you here. Just before you go, one quick question - State of Origin Wednesday night. Score?
PM: Not predicting the score, but I am predicting who is going to win, and it starts with ‘Q' and ends with ‘D'.
STEVENS: Fantastic. Prime Minister, thank you very much for your time this morning.
PM: Good on you, thanks very much.