2011-12 Budget; Carbon price; Set top boxes
HOST: Let's welcome Prime Minister Julia Gillard. Julia, thank you for coming in this morning.
PM: A great pleasure. Thank you for having me.
HOST: I did ask you privately, but I'll ask you publically, because I think it's fair - have you had a proposal put to you, yet?
PM: No, I haven't, Leon, so I can't report any big news here on that front.
HOST: So, you're waiting? Are you expecting one?
PM: We're very happy the way we are. Tim is actually here in Adelaide too, so that's a good thing.
HOST: Well, it might happen whilst you're here.
PM: Oh, stop it. You're just being naughty, now.
HOST: Alright, let's have a look at the Federal Budget. Now, according to the latest opinion polls, Prime Minister, most people are not saying ‘this is a great Budget.' Most people think they're going to be worse off. What do you say to that?
PM: I understand that a lot of families are worried about cost of living pressures. People are seeing big increases in their utility bills, particularly the price of electricity, so I understand it can be very difficult for a lot of families, but looking at the Budget, the central focus of it is jobs and opportunities for Australians.
I mean, people are trying to manage their cost of living pressures, but I understand that people need to come to that with a job. Nothing adds up unless you've got that all-important pay packet, so we're very proud we've created 750,000 jobs to date and we're looking to create half a million more, and I want to spread the opportunities of the mining boom right throughout the country.
I don't want to see people left behind, which is why there's a big focus on workforce participation and skills.
HOST: On this business of jobs, and I raised this with your colleague, Wayne Swan, yesterday, who did say, I mean, we've got a major training problem here in Australia. We've done our own investigation with some very good people like Dr Chris Hamilton and Gary Colless(*) and others, and there's a lot of training courses out there that you can pay a lot of money for but at the end the training's accredited, but you're not accredited at the end to get a job for which you've been trained, and I just think, Prime Minister, it's a very good thing for your Government to make such a commitment, but you need to seriously audit some of these training courses, because most of them or a lot of them are just ‘here's a broom and come and stack the shelves for a few weeks, and that's your training.' You've obviously heard this.
PM: Leon, I think you raise a very important point, and our training system does need reform, and a focus of the Budget is delivering money that will be used to buy reform. We can do this better. We should do it better.
HOST: So, you're going to audit a lot of these courses.
PM: We certainly moved to upgrade regulation for private providers. That first came to my attention when I was Minister for Education, where in the international education area, whilst we saw great-quality providers, a great reputation for Australia, we also saw some people who were doing the wrong thing, so we've moved to bring more regulation and better quality into the system, and we've got to keep building on that quality.
Around 1.7 million Australians engage in training. A lot of them don't complete because they're not satisfied with the course or they're not appropriately supported, so we will be focussed on reform and better quality, and out of the Budget, too, we're creating 130,000 training places in partnership with industry. Now, that means if business has got its money on the table, joining-
HOST: -That's not new though, we've been doing that for a long time.
PM: Well, we're expanding it, and we're doing that because if business has got its money on the table then it will be investing with us in the training that will really matter and get people jobs.
HOST: Alright, now, your Government, Prime Minister, has donated $200 million a year for three years to a climate United Nations fund from a tax that you are yet to collect and promised you wouldn't before the last election. Given that battlers are doing it tough in Australia, how do you justify that?
PM: Look, our contributions to climate change adaption for countries overseas come out of our overseas development budget, and we do want to help, for example-
HOST: -But this is extra money, though. Your own government websites have said this.
PM: Our development contributions are increasing, and that's a bipartisan political support. That has bipartisan political support in this country. It's as we work our way towards the Millennium Development Goals. We do need to support some of our neighbours who have major troubles. We live in a region with many low-lying island states who are going to be very challenged by climate change and rising sea levels.
Greg Combet's actually outlining that challenge for Adelaide here today.
HOST: I know he is, and this is something that was first mentioned in 2009, so it's not new, and some have argued that you're trying to scare people into submission to agree to a carbon tax.
I'll get back to that in sec, but Dr John Bruni from Sage International has pointed out that some of the countries for which will share this $200m million a year are actually countries that can't even be trusted with aid, let alone this kind of money.
PM: Well, we audit and have a rigour in our aid system, Leon. We've got a review underway at the moment, and that will be made public at the appropriate point, to make sure that aid money is well spent.
Of course, I want-
HOST: -We heard a scandal about aid, didn't we, not just recently, about how much money is going in to military juntas and others who are not entitled to it.
PM: But Leon, I think we've got to also remember our aid money does things like help with eradicating diseases like polio around the world.
HOST: Yes, it does.
PM: Wouldn't we want to live in a world where no child is afflicted by polio anymore, so we're getting vaccines literally into the arms of kids around the world.
HOST: But we wouldn't want to do, though, is take money off good people here who are doing it tough and give it to regimes that can't be trusted.
PM: Oh, I couldn't agree with you more, and that's we have all of the oversight that we do to make sure that that doesn't happen, but can I say to your listeners, too, Australians are very generous. Australians donate to Save the Children, many of them through World Vision have adopted a child overseas, and Australians, I do think, want us to do our fair share - not more than that - but our fair share under the Millennium Development Goals to stop kids dying of hunger and preventable diseases in our world.
That's what we're doing, and that has bipartisan political support in this country. I support it, and Tony Abbott supports it.
HOST: The major beneficiaries of Family Tax Benefit Part A are actually families earning $30-$40-$45,000 a year, Prime Minister. Their fuel and food costs are spiralling. Inflation is likely to be higher, but you're going to quarantine their increases for two years. They're going to find it very hard to survive. Do you acknowledge that?
PM: Leon, that's simply not true. If you are on-
HOST: -Paul Clithero said this only a week ago.
PM: Well, he's not right.
HOST: He's not right?
PM: He's not right, and people should not believe that. If you are receiving Family Tax Benefit A, and you are on an income of $30,000 or $40,000 a year, you will continue to see your payments indexed. Your payments will continue to go up. Anybody who's trying to tell you anything different is not explaining to you.
HOST: They'll go up by what, the CPI?
PM: That's right, they'll be indexed as usual Leon, and for the families of teenagers, and many families do have teenagers, they will see increases, if they're on the maximum rate, of more than $4,000 a year.
In South Australia, that's more than 50,000 families that will see a big boost in the amount that they get because they've got a teenager in the home, because the family payment system has assumed teenage kids are somehow cheaper than younger kids to support, and that's not true.
HOST: Utility prices right now in this State are enormous. We've just had announced last week, you might be aware of this, a 60 per cent increase in those who use the least water, a 55 per cent increase in their supply charge for water. When you add that to electricity consumption, and the prices are going up whether we have a carbon tax or not, power prices are the spiral, are you considering to compensate further those people now, listening to you, who are doing it absolutely tough, because these costs are going up well above CPI.
PM: I understand people are doing it tough, Leon, and what we've done, through this Budget and as a Government, to assist people is we've reduced tax, we've done that three years in a row. That's to help people. We've engaged in an historic increase in the pension to help people on fixed incomes.
In this Budget we are working with families on their cost of living. Family payments for the families you've just talked about will continue to go up. We've increased family payments for families with teenagers. We're increasing the coverage of our education tax refund, the thing that helps you with the cost of getting the kids back to school, so you'll also be able to make a claim on school uniforms, and we're bringing the budget back to surplus exactly as promised to keep our economy strong and to not add to the inflationary pressures which hit people and their cost of living, so they go into the shops and come out having paid more - getting the Budget back to surplus is very important to help us work with families to manage their cost of living.
HOST: Prime Minister, Adam's on the line. Adam, meet Prime Minister Gillard.
CALLER: Good morning. How are you doing?
PM: I'm good thanks, Adam. How are you?
CALLER: Well, thanks. Calling up regarding this carbon tax and how it will affect agriculture, so far as I'm sure food production is a big issue worldwide, but the world is starving and I just worry that the carbon tax will make agricultural lands perhaps more valuable to big business for planting trees more than it is for producing food. Is that something that's likely to happen, and what can be done about it?
PM: Adam, you don't have to worry about that at all. The approach we've taken for agriculture with carbon pricing is agriculture will not be included in the scheme, so there won't be a carbon price on farming, but there will be benefits for farming because there would be a carbon credit scheme. Many farmers are changing their land management practices. They're still growing food, but they're doing it in a more efficient way which actually stores carbon in the soil and through other mechanisms, and they will be able to receive money for doing that under our carbon farming initiative, so this is good news for farmers.
Can I just say on carbon pricing generally, I understand that we've got to keep explaining all of this to people, and we will. All of the details will be available in the middle of the year.
HOST: Will it include petrol?
PM: Well, all of the details, Leon, will be available in the middle of the year, and as we do it I will be very mindful of getting assistance to families to help them with cost of living, and I understand paying for petrol does matter to people's cost of living, but Leon, I think it's important for people to understand the alternative - I am going to be announcing details of a scheme: our 1,000 biggest polluters, big businesses paying; families being assisted with cost of living pressures.
What Mr Abbott is proposing, and this cat has only come screaming out of the bag in the last 24 hours, his spokesperson Greg Hunt has revealed they're planning a $15 a tonne carbon price, no assistance to families-
HOST: -What price are you planning?
PM: Well, we'll make the details clear, but we will give assistance-
HOST: -Be more than that?
PM: Leon, it will come with assistance. Mr Abbott is saying $15 with no assistance to families.
HOST: Is this about the environment or wealth redistribution, because, see, this whole, correct me if I'm wrong here, we're being told we must apply the carbon tax to act on climate change. Now, that's what I'm hearing, OK, we're all hearing this.
But we're hearing more about wealth redistribution than we're hearing about what affect it will have on the temperature of the planet.
PM: Well, Leon, I hope you're hearing about both. The aim of the scheme is to cut carbon pollution. That's what it's for, and the most efficient way of doing that, economists will tell you the most efficient way of doing that is to put a price on carbon pollution paid by big businesses that generate a lot of pollution. At the moment they can stick all of that into the atmosphere for free. When we price it, they will innovate. They don't want to pay the price, so they will innovate and generate less carbon pollution.
HOST: Ultimately, as I understand it, you want to move from a carbon tax to an emissions trading scheme, is that correct?
PM: That's right. That's what we've announced.
HOST: I have in front of me, this is hot off the press, that carbon credit fraud in the economic union is causing more than €5 billion damage for the European taxpayer. It says that the ETS there has been the victim of fraudulent traders for the past 18 months. Now, why on earth would we want to adopt a scheme that's been rorted like this?
PM: Well, we won't. We'll have our own scheme.
HOST: It'll be different to this, will it?
PM: We'll have our own scheme, and we've learnt the lessons from emissions trading schemes overseas, so-
HOST: -Which are?
PM: Well, Leon, we won't be importing any of the problems that other emissions trading scheme have had. But Leon, very important point that you've raised, because in the domestic political debate here Tony Abbott and others would have you believe no-one in the world is doing anything.
Well, Europe's got an emissions trading scheme.
HOST: Which they've suspended, because of all this corruption, and they're saying that organised groups are getting-
PM: -Well, hang on, Leon, that's actually-
HOST: -I've got it here, right in front of me.
PM: And I just want to get some more facts on the table.
Prime Minister Cameron, a Conservative Prime Minister in Britain - if he was an Australian he would be in the Liberal Party - they've had a price on carbon in their economy for a number of years now and they've just announced that they're going to cut carbon pollution by 50 per cent by 2025. Our aim here in Australia is -5 per cent.
So, don't let anybody tell you that the rest of the world isn't acting: 50 per cent in Britain by 2025.
HOST: So, you will avoid speculators getting hold of this and speculating on carbon?
PM: We, of course, have learned lessons from overseas, where people have had emissions trading schemes for a long time, and having learned those lessons we will design this scheme so that it is not able to be used by shysters to make a dollar.
HOST: OK, just quickly, the set top box, $350. Now, Harvey Norman, God bless him, or Gerry Harvey, has announced that he could install a set top box and give you plenty of change, probably for under $200, probably $150 or even $130, but we're paying $350.
PM: Well, it's not an apples to apples comparison.
HOST: It's not?
PM: It's absolutely not, and we've asked Mr Harvey to do an apples to apples comparison and to give us a price. Apples to apples, this is not your cheapest set top box. It's the set top box that will meet the needs of older people, people with disabilities who aren't very good with technology, so it's not the cheapest set top box you can buy.
It's fully installed. You get a 12-month support service so that if something goes wrong then that can be addressed and that can be-
HOST: -So nobody will profiteer from this?
PM: We've got a price here for a service which is far broader than the price of the set top box, so comparisons that have been done with the price of the set top box with an inferior box, with no support for 12 months, are not appropriate comparisons.
We've said to Mr Harvey ‘if you can do the full lot, not a little section of it, if you can do the full lot for cheaper, well, let us know', but it's got to be the full lot.
HOST: Prime Minister, thank you for joining us today. You're in Adelaide because?
PM: I'm in Adelaide because we've got our community cabinet here tonight. This is where people from South Australia will be able to come and meet directly with me and with Ministers, raise their concerns; we'll have a really good exchange with members of the community.
HOST: Good luck, Julia, and when you get the question you'll let us know, won't you?
PM: And I'm presuming the question you're talking about is, you know, how much will families pay for carbon pricing under Tony Abbott? That answer is $720 a year. We'll be assisting families instead.