O'BRIEN: Prime Minister, when were you first made aware of the detail that emerged in Senate Estimates last night regarding your Defence Minister's latest problems? Did you seek an immediate personal explanation from him about that?
PM: I became aware of these matters Kerry this morning after returning from Brisbane late last night and following that the Chief of Staff in my office and the Special Minister of State Senator Faulkner went and spoke at my request with the Defence Minister and the Defence Minister Joel Fitzgibbon then came and saw me in my office. That was around about 1.00pm today.
O'BRIEN: But when he came to you, did he come with his resignation prepared to hand to you?
PM: Yes he did.
O'BRIEN: Was there, at any point any message from you to him via Senator Faulkner or anybody else that you thought he should resign?
PM: What we are seeking to do during the course of the morning Kerry was to establish the facts and during the course of the conversation with my Chief of Staff and with Senator Faulkner those facts were established and the conclusion was reached that the Minister would resign. He did so. He offered his letter of resignation, I accepted it. It was the right course of action. It is a high price to pay for the Minister but the Government stands by high ministerial standards and therefore a high price to pay but a necessary price to pay on this matter.
O'BRIEN: Can we just take it that little bit further. You're saying the decision was arrived at, do you mean you arrived at the decision, you and Senator Faulkner together arrived at the decision, was it, was it your decision that was communicated to the Defence Minister?
PM: No Kerry. No Kerry. The Minister came with a letter of resignation of his own volition. It was the right decision that he took and I accepted his letter of resignation and-
O'BRIEN: But had you arrived at the view yourself, before you saw Joel Fitzgibbon, that you felt he should resign?
PM: I thought these were serious matters but as with any such matter I prefer to actually speak with the Minister or the person concerned and also what Senator Faulkner and my Chief of Staff were doing establishing the facts. Also bear in mind here Kerry that on this overall matter that we're talking about processes involving the Minister's dealings with this particular company. Let it also be made absolutely clear to the viewing audience that no contract was ever entered into on the part of the Australian Government or the Defence Department with this particular company, it was simply a problem about the Minister's staff's participation in meetings with this particular company and that was new information compared with what the Minister had put forward in March of this year.
O'BRIEN: Have you taken a close look at Mr Snowdon's, the assisting Minister, Mr Snowdon's role in this?
PM: I'm absolutely confident that both in the case of the Minister for Defence Personnel, Minister for Veterans Affairs that they have acted entirely properly in this matter. And remember also in the case of the Minister for Veterans Affairs who had partial charge of this matter than he was one of those Ministers who conveyed ultimately to the company concerned that there was not a prospect of the Government responding to the requests that they have made.
The Government acted properly in this matter. My concern was simply the standards concerning conflict of interest which the Minister Mr Fitzgibbon was aware of, his statements to the public in March of this year that he had no direct engagement in the deliberations and what became plain today is that his staff did engage in such conversations with the company and furthermore that one such conversation with the company occurred in his own office. And that's why the Minister concluded it was in the best interests of the Government that he would resign, he did so and he did so because he said in his letter that he did not believe his actions were necessarily consistent with the Ministerial Code of Conduct.
O'BRIEN: Is there any further repercussion with regard to staff?
PM: Well on the question of staff, these things are always dealt with as appropriate by my Chief of Staff and the Special Minister of State. I have no particular concerns which have been raised with me on that matter. The Minister has ultimately accepted responsibility for these matters and I respect the decision he has made. I would also emphasise for the benefit of your viewing audience tonight Kerry that the Minister has been a first class Defence Minister.
The Defence reform program, the Defence White Paper, defence planning out to the year 2030, the build up in the Australian Navy in addition to the successful withdrawal of Australian forces from Iraq and the redefinition of our mission in Afghanistan have all occurred under his watch and under his leadership and I respect that and pay public recognition of that. He has paid a high price for this problem in terms of Ministerial accountability.
O'BRIEN: You acknowledge today mistakes - plural - that there were mistakes prior to this one. How uncomfortable were you personally with the revelations of Mr Fitzgibbon's involvements, his trips to China, the issue of accommodation or whatever being paid by the Chinese businesswoman Helen Liu? How uncomfortable were you with what unfolded there?
PM: Kerry, I was absolutely comfortable with the decisions which have been taken in relation to Joel, up until today and today we were presented with a new set of circumstances. And again I go back to the point, that with both Joel and with other Ministers, in my judgement as Prime Minster they have been doing a first class job.
Obviously in the full spectrum of life and politics, which in the case of Joel goes back many, many years, both his time in opposition and as a backbencher, there are certain things which always going to arise which will be seen as less than perfect.
He is like that. Everyone who is honest about their own political career has got things like that that happens from time to time and of course his became the subject of some public controversy. That is life. Mistakes are made. The key thing here though, as far as this matter is concerned, which a company, headed by his brother, seeking to obtain business from the Department of Defence and a conflict of interest situation unfolding that the Minister's staff continued their engagement with it and he acted appropriately in choosing to resign.
O'BRIEN: I would assume you have taken the opportunity to reiterate rather firmly to all of your other ministerial colleagues that you'll want no repetition of this and that they should acquaint themselves if they haven't already very carefully with the letter and intent of the code of conduct.
PM: Well Kerry I'm confident that Ministers are doing it on a continuing basis, but remember our Minister's are exceptionally busy. It is a hard working Government. We are wrestling with a few things here. The global economic recession, challenges on that front, keeps a lot of us very busy. Secondly, implementing the Government's pre-election commitments and thirdly, long term reform agenda to set Australia up for the future.
This is a very hard working cabinet, very hard working Ministry. And one of the challenges is to make sure that all these individual items of personal accountability are attended to on the way through. But these are the obligations which are on us as Ministers of Government and they are expected.
O'BRIEN: How did it feel to lose your first Minister in this kind of way?
PM: As I said earlier today, Kerry, very sad. I regard Joel as a good Defence Minister, a good colleague and a good friend. But I respect his decision, taken in the best interests of the Government and its public standing, and it also, also his own view of the compatibility of his actions with Ministerial standards, that he took the right decision.
O'BRIEN: How quickly will you be able to decide on Mr Fitzgibbon's replacement? And will you take the opportunity for any kind of a reshuffle that might go a little wider than simply his portfolio
PM: Well I believe always in proceeding reflectively on these things Kerry and making sure we get the decisions right and we will do so. But we will move resolutely as soon as all these things have been properly concluded. I will talk obviously with colleagues and work our way through this. Ultimately it is my call and I will seek to make the absolute best call possible. In terms of any further changes within the Government, I believe the Government as a whole is functioning exceptionally well, in very difficult circumstances. I would not be foreshadowing any major changes.
O'BRIEN: You've had to face some personal questions yourself from the Opposition today about a car you were apparently given by a Brisbane car dealer John Grant Motors, if that's correct that you were given the car. What is the story of the car? What was the basis of the agreement that you had with John Grant Motors?
PM: Well Kerry can I just say one thing very plain and upfront, this has been in my pecuniary interest declaration for two years. It has been up there in black and white. What it is, is a local utility car which I use as a local mobile office vehicle. My habit in the past as a member of parliament up there, and whenever I can get the time these days up in the electorate of Griffith, is to go out and do mobile offices on street corners.
It is a ute, on the side it has, ‘Kevin Rudd's Mobile Office'. I have been doing this ever since I was elected, one way or the other. This vehicle was provided by the individual concerned, it was put on the pecuniary interest declaration two years ago and I have been completely -
O'BRIEN: Is it in a sense, is it a form of political donation?
PM: Absolutely, that is why it is on, that is why it is there on the pecuniary interest declaration. I have been absolutely upfront about this. Mr Turnbull and the Liberal Party have known about this for two years. It has been there, in black and white since before I became Prime Minister. I think what they were seeking to do today, having engaged in the politics of fear on the economy, where their political strategy fell in a heap yesterday, was now to go into the politics of personal smear.
And I can only conclude, can only conclude that given the declaration of this mobile office vehicle has been out there for a couple of years, completely transparently on the public record, that they have chosen to do it for these base political motives.
O'BRIEN: Well I would imagine if he was here, Malcolm Turnbull would say that he's perfectly justified in asking the question because it was your Government set up the Oz Car scheme, and his question relates to whether you have made personal representations on behalf of John Grant Motors to Oz Car about setting that company up a line of credit.
PM: And the fact is, Kerry as I said in the Parliament today, is that I have made no such representations. That is an absolute fact. So instead of simply standing up in the parliament today and retracting the insinuation and the allegation, Mr Turnbull just barrels ahead, engaged in a broad politics of negativity and personal smear.
The bottom line is, the Oz Car initiative is out there because across Australia today, and for the last six months, we have had thousands of car dealerships in real strife because of the contraction of normal sources of finance. At the end of last year, we had two of the major global providers of car finance to the Australian dealership industry, remove themselves from the market. We sat down with the banks, established a special purpose vehicle with them, for the Government to provide this support to the industry, did so in consultation with the industry association, and have made it available to the thousands of car dealerships across Australia.
Many members of parliament legitimately have made representations to the Government, to the Treasurer and to others about possible support from this scheme and why it is important - the motor vehicle industry generally has been experiencing great challenge and difficulty. We have been out there in the Government, on the front foot, doing the right thing by industry in general.
O'BRIEN: Kevin Rudd, we are out of time, thanks for talking with us.
PM: Thanks Kerry.