HOST: Prime Minister, welcome to PM.
PM: Good evening.
HOST: What do you know of the rescue mission off the Cocos Islands?
PM: I can take you through what my most recent advice is, which is that as of 11.15 last night the Australian Maritime Safety Authority received a report that a vessel had sunk approximately 350 nautical miles North-West of Cocos island. Initial indications from a commercial vessel on sight were that 39 people were believed to be on board. The Australian Maritime Safety Authority issued a general alert requesting immediate assistance from any vessel or aircraft in the area. Two foreign flagged commercial vessels were on site and seeking to assist the people in the water.
There were no Australian vessels within the vicinity. The latest advice is that 19 people have been recovered and are on commercial vessels. An RAAF P3 surveillance aircraft is on the scene, assisting in the rescue operation.
I'm just now advised the RAAF has dropped a raft to two persons in the water and three additional people were seen on timber headed towards raft. Furthermore, a Customs and Border Protection Dash-8 aircraft out of Broome has also been tasked to assist.
You will appreciate that this is an unfolding rescue operation, and obviously there are great difficulties associated with the events at sea.
HOST: Do you know anything of the people who are on board that boat? Do we know if they are asylum seekers, if they were coming to Australia?
PM: Well, we don't have any of that information at hand that I have been advised of. You'll appreciate that the work of the Australian authorities so far has been entirely focused on a search and rescue operation and that is still on foot and as all other details come to hand we'll, of course, make that available to the public.
HOST: You still have 78 asylum seekers on board the customs ship the Oceanic Viking. They've told the ABC they've already been in Indonesia for years. Doesn't that mean that they haven't been influenced by the push factors you say are responsible for the increase in boat arrivals?
PM: We'll, firstly, in terms of their particular status, I've got no information available to me as to where they have been in recent times, so that will be established in the fullness of time.
You go to the broader question of push factors. Push factors have been operating in various period of instability in Sri Lanka over recent years. Of course, that reached a particular crescendo with the military operation in the North of Sri Lanka earlier this year, but if you look at what happened with movements from Sri Lanka, they've also been underway for some several years in recent times as military activity and conflict within that island has escalated at various times. It's just part of the reality - push factors operating from countries of origin, transit countries, Malaysia and Indonesia, and the difficulties arising from vessels leaving those countries, and, of course, our own assets on the high seas there to interdict vessels as they come through.
HOST: The stand-off will have to end sometime, though. How long are you prepared to be patient?
PM: Well, the Indonesian Foreign Minister has said last week, I think, that Indonesia had infinite patience in the handling of these matters, as does the Australian Government. We will work our way calmly and methodically through this challenge, as we will work our way through all other challenges.
This is a very difficult set of circumstances. Remember, there has been a bloody civil war in Sri Lanka. There have been something like 260,000 Sri Lankans displaced by that in recent times, living in camps. Some 130,000, I'm advised, have gone to live in Tamil Nadu on the Indian continent, and we therefore are facing outward pressures, not just to Australia but to other countries of interest to Sri Lankans under these circumstances - countries in Europe, Canada, the United States, Australia, and, of course, Malaysia and Indonesia as well.
HOST: Why not, though, heed the ACTU's call today for compassion and simply bring them to Christmas Island for processing?
PM: Well, our approach to border protection is a responsible policy based on Australia's national interests that is tough, hardline on people smugglers and at the same time humane in our approach to asylum seekers. That's the approach we took to the Australian people prior to the last election. That's what we've implemented since the last election.
It's very easy for people either on the far right or, from time to time on the left, criticising such an approach. I fully accept that this difficult set of circumstances and the implementation of our policy in the midst of these difficult circumstances will not be popular. I understand that, but my job as Prime Minister is to implement tough, responsible humane policy in the national interest. We've done so in the past and will continue to do so in the future.
HOST: You updated your budget figures today. They show better economic growth, but do you risk being a victim of your own success as people get caught between paying higher interest rates on more expensive homes but still face losing their jobs or working hours?
PM: Well, the core question here is the impact of the Government's stimulus strategy on the real economy and providing people with more jobs than would have otherwise be the case.
Let's be very blunt about this - had we not implemented the stimulus strategy we would have hundreds of thousands of more Australians who would end up out of work and what we've seen with these figures released today is the unemployment rate forecast now projected to peak at 6.75 percent as opposed to 8.5 percent at budget time.
HOST: But that still means that people are going to lose their jobs at a time when the monetary stimulus, interest rates, is being unwound, interest rates are going up.
PM: Well, the bottom line is this - as a consequence of the Government's stimulus strategy we had higher growth, lower unemployment, lower debt to the tune of $50 billion dollars and lower deficit, and had we not implemented the stimulus strategy you would have had hundreds of thousands of more Australians out of work. What this demonstrates, this data released in the mid-year economic and fiscal update today is the Government's economic policy is working.
Furthermore, extraordinary interventions in order to support the private economy when it has been in distress and retreat have been necessary, but as those stimulus measures take their full effect it follows, over time, that they will naturally scale down. That is why the Government's stimulus strategy was particularly designed to peak early and then to tail off. That is how it was implemented. That's how it's operating, and as we can see from these figures out today, is the stimulus strategy is having a real effect on the economy and on the jobs of hundreds of thousands of Australians
HOST: You've already, in the Treasury's words, recalibrated elements of the stimulus package today, adjusting spending on education building, amongst other things. Why not look more broadly at spending now to see if you can make further savings because the economy's so much better?
PM: Well, the important thing to note about our approach to budget discipline in the period ahead is that any new expenditure that the Government has embraced since Budget time has been offset by savings. That's the first discipline and that actually reflects the Government's overall disciplined approach to the fiscal rules that we have announced at budget time, that we'll continue to implement into the future.
Our task is to return the budget to surplus in the medium term. Of course, we've been dealing with extraordinary economic challenges because of the global recession, the worst in 75 years. The measures out today involve some re-phasing of the Building the Education Revolution program, some half a billion dollars being re-phased from 2010/11 to 2011/12, and the reason for that is to provide extra time for tendering and re-tendering and further consultations with local schools and community factors, any unforeseen circumstances, to maximise, of course, the value for money from those programs.
That's the right and sensible approach, but I go back to my overall point - had the Government followed the Opposition's advice and not introduced an economic stimulus strategy, Australia, like all the other advanced economies of the world, would now be in the midst of a very damaging and devastating recession, with hundreds of thousands more Australians out of work.
HOST: You've copped some criticism from the former prime minister, Paul Keating, about your appointment of Peter Costello to the Future Fund board. Mr Costello said in 2007 of your plans for the Fund that you couldn't be trusted with money, that you're like a bear with a honey pot trying to consume it for your own electoral purposes and that your plans were economic irresponsibility in the first order. How does that make him the best candidate for this job?
PM: Well, the first thing I'd say is that people in public political life over time will say a whole range of different things. My job as the Prime Minister of Australia is to stand back, look at the overall worth of an individual, the talents and abilities they have, and to harness those for the long-term national economic interest.
HOST: Do you know if he's changed his views?
PM: Well, frankly, I don't particularly mind what views Mr Costello would have on those matters. What I do know is that after 12 years as Treasurer of Australia he's accumulated some experience. That experience should be harnessed for the national good.
I have said repeatedly in the past, whether it's with Kim Beasley, whether it's Brendan Nelson or with others, and I will do this again in the future, but we will harness the talents that are available, whether they are from Liberal or Labor politicians, to the best use of the long-term national interest.
That's the right thing to do, and as I said yesterday, I'm getting criticised on the one hand by Paul Keating, by Malcolm Turnbull on the other hand, for Mr Costello's appointment. Just maybe, just maybe, we're getting something right here.
HOST: Finally, Mr Rudd have you established a global advocacy unit in your department to push your agenda to in areas like the G20 and the Asia Pacific community. If so, why can't the Foreign Affairs Department do that work?
PM: Well, the Prime Minister's Department, since time immemorial, has had an international division. It goes back to the previous prime minister and the one before that and the one before that, and in fact is goes back to the days when I was a cadet diplomat in the Department of Foreign Affairs. It has always provided international policy advice to the prime minister of the day.
Secondly, because Australia now has a seat at the top table, that is the G20, the Government has established a new global and regional architecture section within PM&C. That is entirely right because this series of meetings is at summit, head of government, that is, prime-ministerial or presidential level. That's exactly what we're doing. It's the right thing to do because we've also got to engage these governments in terms of head-of-government level policy coordination. We're doing this all the time on a rolling basis and we did so in recent times as well in the lead-up to the Pittsburgh summit, and it also involves public advocacy.
HOST: Does it involve pushing your case through the international media?
PM: It may be of some surprise to you already that I have had a number of articles printed in the international media up until now advocating Australia's case for global financial reform, for doing the right thing when it comes to long-term climate change finance, and for a whole other series of proposals we've had to continue to support the global economy during the great stresses of the last three quarters of the century. I've been doing this for the last year or so. I'll be doing it into the future and it'll be supported, now that the G20 is being institutionalised as the premier institution of global economic governance, we'll be doing more of it in the future.
It's in Australia's interest that we do so, for our voice to be heard in its own right in the principle capitals of the world, in the private halls of diplomacy and through public advocacy in the media of those countries as well. It's the sensible thing to do.
HOST: Prime Minister, thank you very much for your time.
PM: Thanks for having me on the program.