PM BROWN: Thank you very much for joining us. I'm delighted to be meeting Kevin Rudd, the Prime Minister of Australia.
Kevin Rudd is taken a very big leadership role in trying to address the problems of our financial system. The Australian Government has just announced a major fiscal stimulus and his leadership is proposing reforms in the international financial system which are very important to the conclusions I believe we'll reach today.
I think the key thing is that we need to stabilise the banking system. We need to show that monetary and fiscal policy is working to best effect so that we can take our economies through these difficult times. And we need to continue the momentum which is absolutely essential to reform the international financial system to deal with these obvious failings that have been exposed over these last few months. And at the same time, by making the changes, to make people more confident about the financial system so that they can feel sure that their savings are safe, that their mortgages will be dealt with in a proper way, and of course, that we can have our jobs and our economy and the prosperity that people want.
These are all the issues that we will be dealing with tomorrow, but I wanted to thank Kevin for his leadership in all these areas.
PM RUDD: Thanks very much, Gordon.
The British Government and the Australian Government have been working closely together in recent weeks and months and most particularly in the lead up to the G20 Summit here in Washington. And I thank the British Prime Minister for the excellent work which he and his representatives have been doing in capitals around the world to seek to forge a consensus to move towards this important meeting in Washington tomorrow.
The challenge we face is this - this global financial crisis has become a global economic crisis with impacts on the real economy and on jobs. It affects families right across the world, whether you are in a developed economy or a developing economy, large countries and small, rich and poor.
So this is a challenge of global dimensions requiring an intrinsically global response.
Therefore, as we meet as heads of government of economies representing some 85 per cent of global production, the challenge we face is: one, the stabilisation of the financial system now; two, proper regulations for the future operations of financial markets; and three, most critically, to the greatest extent possible, coordinated fiscal and monetary policy action to support growth and jobs in the critical year which lies ahead.
This is not just a question of high policy debate. This is of direct relevance to households right across the world. And again, I commend the British Government for their leadership across the world in preparation for this important meeting in Washington tomorrow.
Over to you, folks.
JOURNALIST: Prime Minister, you've said how crucial it is that these international institutions are reformed and the regulatory (inaudible) is reformed - what are the dangers of this weekend that that's going to get swept aside in favour of talking fiscal and monetary stimulus? And, also (inaudible)
PM BROWN: Well, I've been pushing both immediate reform of the financial system and the stimulus that is necessary for the world economy to move forward. I think immediate reform is necessary and I hope we will set a timetable for that reform to be agreed and implemented because we have got to show people that there can be confidence in the financial system.
Yes, we want to do these reforms so it avoids a crisis in the future, but to make these reforms it's important to do it now so the people are more confident about the financial system that is responsible for their savings, for their investments, for their pensions, for their mortgages.
But I've also been pressing, as has Kevin, for an immediate fiscal stimulus. We've seen monetary policy, interest rates cut, but we also need to see as everybody I think is now seeing in every different continent of the world a move on fiscal policy so that we can make our economies move more quickly forward.
Now, I'm conscious all the time that our undivided attention as government is on homeowners who are worried about their mortgages, pensioners worried about their savings, people worried about their jobs. And therefore it's essential that we combine greater certainty about the financial system from reform and making our interest rates policies and our fiscal policies work so that people can actually see the economy moving forward over the next period of time.
JOURNALIST: Mr Rudd, how important is it going to be this weekend that America falls in line with the rest of the world? And also, you've left the way open for further Australian spending. Looking at the numbers, won't that inevitably push us into deficit?
PM RUDD: Well, the United States has taken the right action in convening this G20 Summit here in Washington.
As I said before, this is a global challenge requiring a global response, and the United States in convening the meeting representing some 85 per cent of world production has done the right thing.
Secondly, in doing so, they have brought together both the developed and developing economies and major emerging economies. And this is precisely the forum necessary to deal with the challenges which are going forward.
Furthermore, on the question of regulation of financial markets, on the question of support for economic growth and stimulus, we believe that we can work all those things through with all of the participating governments - that includes the government of the United States as well.
The US, I believe, has done the right thing in convening this meeting, and what we've seen through the US in their work with all of us in the preparation of decisions for leaders in the lead up to tomorrow's meeting, they've been very active, very supportive, and very constructive.
On the second part of your question which goes to the need for coordinated stimulus, as Prime Minister Brown has just said, this is a view of governments practically all across the world.
We are facing a major assault on growth and jobs into calendar year 2009. This is a major challenge for households across the world. You can either stand back and do nothing, or you can act, and act decisively through the policy instruments available to us. Both in interest rates policy as well as direct Budget stimulus.
For us in Australia, we have made forward provisioning for the package of measures that we have announced, and we stand ready and determined to take up whatever further action is necessary to support growth and jobs into the future.
If I could add one final point, this in Washington is a critical first step. What we will also need to do is to as leaders convene again. And that is going to be important to draw this important work which we are currently engaged in to its proper conclusion. And again, I support Britain's leadership in not just assisting and forging a consensus around tomorrow's meeting, but in providing necessary support for the work going forward as well.
JOURNALIST: Does that mean yes on the deficit?
PM RUDD: On the question - well actually, that wasn't directly asked - but let me just go to that because I was -
JOURNALIST: (Inaudible)
PM RUDD: Sorry, I lost the end of it, this is the question I answered last night.
Our policy remains to maintain a Budget surplus across the economic cycle. Our policy has been that since before the Australian election, it's been that since the election, and the same going forward. But we remain determined to take any policy action necessary to support growth and jobs into the future, consistent with our policy of retaining a surplus across the economic cycle.
Thanks very much, got to go.
PM BROWN: Thanks very much.