HOST: Prime Minister Julia Gillard joins me now, good morning to you.
PM: Good morning Kochie.
HOST: The compensation is just amazing, more than most people expected. Is it a sort of a bribe to get us on the carbon tax band wagon?
PM: It's the tax reform that I thought was really necessary for the country. Kochie, people would have heard me say before that I understand there's nothing more important to individuals or the future of this nation than people having a job, have the benefits of work. So as we design the best way of cutting carbon pollution, I also said to myself what is the best way of showing people that we value work? And that's why the tax reform that comes with this package is about lifting the tax free threshold from around $6,000 to around $18,000, that is trebling it. That means one million tax payers will come out of the tax system, they won't have to scrabble around looking for receipts at the end of the financial year, that's an important tax reform in its own right, valuing work. And of course that also works through the tax system to provide people with a helping hand with the price impacts they will see from us putting a price on carbon pollution.
HOST: As Australians though we're always weary about a new tax. We don't trust politicians, we didn't trust John Howard with the GST. He had to give us a rolled gold guarantee he wasn't going to increase that 10 per cent level and under the carbon tax you've got a lot of exemptions: agriculture, transport, petrol are all exempt. Will you give a rolled gold guarantee that you will not expand the carbon tax and overdo those exempts? Will you guarantee those exemptions will stay?
PM: The only plan to add an additional piece to who pays for carbon pollution was announced yesterday and that's to bring the heavy vehicles into the scheme from 1 July 2014. So, that's it Kochie, that's the only expansion that's planned. But Kochie I'm going to be really honest with people here and I think it's important people do understand, the price the around 500 big polluters pay for the amount of carbon pollution they put into the atmosphere, that price does go up. It's starts at $23 and then it does go up over time, but so does the household assistance and there will be a second round of tax cuts.
HOST: Okay so you'll guarantee no carbon tax on petrol or agriculture forever.
PM: Correct.
HOST: Great! Well we're also getting a lot of people say ‘Hey, when prices go up with the carbon tax we get the GST wacked on top of it as well'. Is that a tax on a tax?
PM: Well, you will see a cost of living impact Kochie, yes you will, a 0.7 per cent increase in the Consumer Price Index. So that is a modest price impost, so that's all in, all up that's what will change and all in, all up 0.7 percent of the CPI and that's what the tax cuts and increases in family payments are for.
HOST: OK. Also, obviously a lot of businesses are going to use a carbon tax as an excuse for putting up prices, what's the guarantee we're not going to be ripped off by businesses who just pass on too much, who make a profit on this?
PM: Well, we'll have the same cop on the beat as was on the beat when the GST came into effect and Kochie let's get a sense of scale here, the GST was a far bigger change, more on people's household bills, far more on people's household bills. The same cop will be on the beat and that is the ACCC, they'll be out there monitoring to look and see if anybody is trying to use this as an excuse to profiteer.
HOST: And just one last quick question, while everyone is focussing on compensation and how big it's going to be, on the other side of it, a lot of money is going into developing clean technology industries in here, in Australia, which is about time.
PM: Absolutely. Everybody is going to want to work through all of the details of this and that's a good thing. They'll want to know about the tax cuts, they'll want to know about the family payment increases, they'll want to know about the pension increases, they'll want to know about what's happening in coal and steel and manufacturing. All of that's a good thing Kochie. But you're right, at the real heart of this is a clean energy future for our country. How do we move to use the renewable energy sources our wonderful country has in abundant supply - solar, wind, geothermal, tidal. So, right at the middle of this is the carbon price to make dirty energy more expensive and $13 billion to help us catalyse the renewables industry. More solar, more wind, more geothermal, more clean energy.
HOST: Why do we have to be first in the world to do this? What other countries are doing it, why do we lead the way, why can't we come in the middle of the pack after everybody else?
PM: Oh Kochie we are not leading the world. There are emissions trading schemes in other parts of the world already. Europe's got an emissions trading scheme, New Zealand's got an emissions trading scheme - I almost said Kochie then, ‘even' New Zealand, then all the New Zealanders listening would probably be upset. But a small country like New Zealand has moved to an emissions trading scheme.
We are actually starting this race to a clean energy future behind the pack in the sense that we generate more carbon pollution per Australian than any other country in the world does, in the developed world. So, compared with countries in the developed world that we compete with, we've got a longer journey to get a clean energy future, that's why we've got to make a start and we'll make that start on 1 July next year.
HOST: We just need China and India to get onboard and all those countries. Prime Minister thanks very much for joining us.
PM: Well China and India are acting Kochie, so we've got to keep pace. I'm not going to have this country left behind.
HOST: Alright, thanks for joining us this morning.