Queenstown, New Zealand
PM KEY: Good afternoon. I'm just going to make some opening remarks and pass over to the Prime Minister to make some opening remarks before we take any questions, as you might like.
But firstly, I'd like to extend a warm welcome to Prime Minister Gillard. I'm delighted to host the Prime Minister and her delegation here in Queenstown, one of New Zealand's most beautiful destinations.
These annual leaders' meetings reflect the unique strength and depth of the relationship between our two countries.
I've expressed to Prime Minister Gillard our sadness at the loss of life and the toll on people's livelihoods from the floodings in Queensland and New South Wales, as well as the bushfires across several states.
It says a lot about our relationship that we stand by each other when times are tough.
New Zealand was able to provide some assistance to the recent fire-fighting effort in Tasmania, and New Zealanders will never forget Australia's valuable help immediately following the Christchurch earthquakes.
As well as being our closest relationship, Australia is also our most important.
It's our biggest trading partner and business partner, our largest source of investment, and our closest ally in matters of defence and security.
Our talks today have covered all of these areas, as well as issues that affect us across our region and internationally.
We have looked at what we can do to best position both countries to take advantage of the opportunities that are emerging across the Asia-Pacific region, and how we can work together to ensure our prosperity, security and wellbeing in the years to come.
In that context, this year marks 30 years since the signing of the Closer Economic Relations agreement.
Both of us acknowledge the vision that made CER a gold standard trade agreement 30 years ago, and the successive rounds of liberalisation and integration that have maintained this status.
CER has brought down barriers to trade, reduced costs for business, encouraged investment and created economic growth and jobs for both countries.
To mark the 30th anniversary of CER, we are announcing further steps to make it easier for people and businesses to operate in the trans-Tasman economy.
The first of those, on mobile roaming: we have agreed to give our regulators the tools to ensure that roaming rates become more competitive on both sides of the Tasman.
I welcome Prime Minister Gillard's decision to help streamline the travel experience between the two countries by making a new investment in SmartGate.
The CER investment protocol will enter into force on 1 March, further reducing barriers to trans-Tasman investment, and new arrangements for the portability of personal retirement savings will come into effect on 1 July.
These measures underline our Government's commitment to continuing the process of economic integration which has contributed so much to both of our countries.
And there's more work to be done. Prime Minister Gillard and I have today discussed the first joint report of our two Productivity Commissions on strengthening trans-Tasman economic relations, and especially on ways to increase productivity and competitiveness.
We agreed that we are likely to be able to move ahead with many of the recommendations in the report quite quickly, while theirs will obviously need more consideration and a little more time.
I've asked officials to do some work on the recommendations, with the aim of providing a formal response to the Commission's advice by the middle of the year.
We also discussed the growing problem of people smuggling in the Asia-Pacific region, and its tragic consequences, including loss of life at sea.
Both countries are committed to a regional approach, including the implementation of the Bali Process regional cooperation framework to counter people smuggling.
Australia is grappling with the huge challenge of illegal arrivals by sea and is at the forefront of the efforts to disrupt people-smuggling across the region.
As part of our support for a regional approach, New Zealand will resettle 150 genuine refugees annually from the Australian system.
There is more detail on this initiative in our joint statement, but it's fair to say this will now be part of the 750 refugees that we annually take as part of the UNHCR programme.
So, in essence, it's not an increase in the number of refugees that New Zealand takes, but it's a different sourcing of location of those refugees.
In terms of cyber security threats, they are of increasing concern for governments on both sides of the Tasman, and we have agreed that our officials will continue to work very closely in this area, including new work on cyber instance response under Australia and New Zealand's cyber security dialogue.
We have agreed that both governments will provide funding over the next two years to support the development of a potential vaccine for rheumatic fever. This follows reports that we've both received from our chief science advisors.
Rheumatic fever, as you'll be aware, is a significant issue for Maori and Pacific, and Aboriginal Australians, and an effective vaccine would be a major step forward for the health of these communities in both countries and across the Pacific.
We've also agreed to get officials to do some more work on how we might operate a mutual student debt recovery scheme.
This would be another useful step in our efforts to share information and connect our systems, and would ensure that student debt could be recovered from graduates wherever they end up in the trans-Tasman economy.
This is a rich and complex relationship, and we've discussed a wide range of other issues, including issues about our region and internationally.
I won't mention them all individually, but you'll see many of them are mentioned in our joint statement, and I'll be happy to take a few more questions.
But, after that introduction, Prime Minister Gillard, over to you.
PM GILLARD: Thank you very much Prime Minister Key, and I won't repeat all of Prime Minister Key's remarks, but I will pick up on some specific areas.
First, Prime Minister, can I thank you for the warmth of your welcome and for the very productive discussions we've had during the course of this morning.
You've decided to host this annual leaders' exchange in a tremendously beautiful location, so thank you for that too, and I can assure people that The Remarkables are well-named; they are truly remarkable.
The relationship between Australia and New Zealand is one of family.
We work very closely together. As the Prime Minister has said, we are always there for each other in times of need, and we did have some of those times of need in recent weeks, facing floods and fire - and New Zealand once again came to assist us during that period of time.
So thank you very much for that ongoing support.
Our relationship and the depth of it manifests in many ways. One way it manifests is in the Close Economic Relationship we've had for the last 30 years.
Prime Minister Key has referred to it as a ‘gold standard free trade agreement'.
What it has meant is that two open economies have turned towards each other and we have worked to ensure free exchange and more jobs and more growth in each of our nations.
I'm pleased that for the 30th anniversary of the Closer Economic Relationship between our two countries we've been able to identify some areas to build for the future.
One of those areas is the very practical issue of mobile roaming rates for Australians and New Zealanders when they travel.
Often when we talk about things like CER, a Closer Economic Relationship, people probably wonder, well what does that mean for me in my own life? It all seems a little bit hard to judge. But this is a very practical thing.
A million Australians come to New Zealand every year. They bring with them their mobile phones.
Many of them are on holiday, so they do the kinds of things that people do on holidays: they take a photo and they try and send it back to people at home. They ring up friends and family at home to tell them what they're up to on their holiday.
At the moment, that can cause extraordinary charges, many of which people wouldn't be aware of until they get back home after their holiday and get their next mobile phone bill, and get a very rude shock when they do.
So to give people a sense of that, at the moment it's possible to be charged $40 if you're trying to get a photo through. It's possible to be charged $8.50 a minute if you are chatting to friends and family back home.
This isn't just a problem for Australians in New Zealand who are on holidays - it's obviously a problem for business people too who are routinely travelling between the two countries, needing to access mobile phones in order to do business.
Their choice at the moment is to put up with very high charges or have to get another sim card and go through that process every time they move one side of the Tasman or the other.
We have identified this as a practical area for cooperation, and today agreed that there needs to be annual reporting and more transparency.
But ultimately if we don't see reductions in these kind of charges, we will empower our competition regulators to act and to intervene in the market to get people a better deal - a very practical outcome for the people of Australia and New Zealand as they travel in such huge numbers to each other's nation.
So I'm very pleased we've been able to agree that today.
I'm also pleased we've been able to agree to fast-track automated border processing procedures for Australians and New Zealanders when they travel to each other's nation.
We currently have SmartGate technology on arrival; we are now looking at it on departure.
We will be testing various technologies because we do ultimately want to see the experience of travelling between Australia and New Zealand as a domestic-like experience - something that people can easily do and not feel that they are encountering a set of impediments which come with travelling overseas to other destinations.
I'm also pleased that we're able to announce that we are looking forward to the entry into force of the CER Investment Protocol that will come into force on 1 March 2013, and that will make it easier for investment in each other's nations.
I want to thank Prime Minister Key for the agreement that we have struck around a regional approach to asylum seeker and refugee issues.
This is truly a regional challenge: one that we work on together through the Bali Process.
Australia expends a lot of effort in detecting and disrupting people smuggling ventures and prosecuting people smugglers.
This is transnational crime, and we take a very rigorous approach to detecting and disrupting ventures and making sure that those who have profited from them are actually held accountable for what they're doing.
I'm pleased that Prime Minister Key has agreed that New Zealand will settle 150 refugees each year from Australia's system, as part of New Zealand's refugee cohort.
We've had broad discussions about a range of bilateral and regional issues. To mention just one, we have spent some time talking about our shared desire to see democracy return to Fiji.
We've got more to do as part of the annual leaders' exchange, and apart from once again thanking Prime Minister Key for the warmth of the welcome and the productive discussions today.
I would like to say I am looking forward to the two of us a little bit later today visiting the War Memorial in Queenstown and there reflecting on what our nations will do to commemorate 100 years of Gallipoli.
JOURNALIST: Prime Minister Gillard, what is the benefit to New Zealand of taking refugees that otherwise wouldn't have got here?
PM GILLARD: Well, I think from Prime Minister Key's statement, it's not taking additional refugees.
You resettle 750 refugees each year - now 150 of them would come from the Australian system, so it's not additional, it's part of efforts that you already make.
I think the benefit of taking a regional approach and collaborating together is obvious: this is a regional problem.
What we do in detection and disruption, intelligence gathering, is shared with and affects New Zealand.
We are happy to make those efforts; we're happy to share the benefits of those efforts.
It shows that this is a regional problem and the more you cooperate and the more you do together, the better it is.
JOURNALIST: How many years is the agreement for? When does it start? Where do the refugees come from? Are they going to come from Manus and Nauru? And if that's the case, how does that fit with the no advantage test?
PM GILLARD: Well I'll take that question. Prime Minister Key might want to say something.
The aim here is to have it start in 2014 and be ongoing. We need officials to have a set of discussions to make all of the appropriate arrangements.
The 150 could be drawn from people who are in Australia now, and we would want to work with PNG and Nauru to make the appropriate arrangements over time.
So it is possible that some of the 150 could come from people who are processed on PNG and Nauru - but I stress that will take the agreement of those two countries, so that there is work to do.
It will fit with the no advantage test: the people who would be the subject of resettlement would have acquitted the no advantage test, because we don't want any message sent anywhere around the world that by transiting to Australia you get some form of advantage, whether it's resettlement in Australia or resettlement in New Zealand.
JOURNALIST: Prime Minister Key, are you concerned that by doing this, this will make us more of a target for boats trying to reach New Zealand, which is one of your concerns - the fact that it makes us look like a soft target, that we will take people on boats that get to Australia? It might make it easier for a boat to come to New Zealand.
PM KEY: Well my view is no, and for the very reason that the Prime Minister has just indicated: the no advantage rule is in place, so if people try and short-circuit the system, they won't get an advantage of that. So no, I don't think it makes any difference.
I think it's quite practical from New Zealand's point of view. We're going to take 750 refugees every year.
It's now just a debate about where they come from. So in taking them from the Australian system, that seems quite logical to us, so it doesn't alter the number that comes to New Zealand.
Secondly, Australia has far more resources and a more sophisticated intelligence network when it comes to trying to disrupt boats that would come through the Australian system.
Now some of those boats want to come to New Zealand, and we've seen examples of that in the past where they've ended up on Christmas Island, but fundamentally were on their way to New Zealand.
So we get something out of the deal, which is we get a huge amount of support from Australia - it's less resources that we have to put in.
And I think the third part of it is we're not ruling out the potential, one day, for New Zealand to look at potentially, if we had a massive arrival, sending them to an offshore processing centre.
Our legislation doesn't support that at the moment, so we would require a law change if we were going to do that, and that would be quite a big step from New Zealand's point of view, but it's part of the work the Government undertook over the last few years.
We looked at how we would handle a mass arrival and where those people would go and how they would be processed, and certainly that is an ongoing area of discussion.
Now that's not on the table today, primarily because we're not driving it, but let's just see in the future. So I think it's a logical step.
JOURNALIST: You say it won't affect the numbers, but we don't always take our full quota of 750. Are you saying from this point on, we will always take the full 750?
PM KEY: No, because the reason we sometimes don't take 750 is obviously because there isn't a huge amount of demand to come to New Zealand.
It sort of ebbs and flows and as we go through the process, it's absolutely identifying the person as a genuine refugee and would fit into the category. So there may always be a few unders and overs, but in real terms we take 750.
JOURNALIST: Prime Minister Key, aren't you punishing the people who go through the right channels, by giving them less of a chance now to come to New Zealand?
PM KEY: No, because the people that come to New Zealand via the Australian system have to demonstrate they are genuine refugees.
So in essence, it's really just a question of where you're sourcing those refugees from. In my view, we're demonstrating we're a good regional partner.
I think it's helpful in terms of what we're combating in the region, and I'm quite comfortable with the process that we've got. I think, as I said earlier, we get something out of this.
Australia's been extremely helpful to us over the last four or five years. There are boats that we could point to that were on their way to New Zealand where Australia has effectively taken those people.
So despite what some people think, I don't think it's a theoretical issue that a boat could turn up in New Zealand any more than it was theoretical that one turned up in Canada.
JOURNALIST: Is this a high price to pay though for extra support with processing?
PM KEY: No, I don't think so. I mean in the end, we're going to take 750 refugees a year; the debate is now about where those refugees come from.
If we take 150 from the Australian system and 600 from other camps around the world, what difference really does it make to New Zealand whether they come from the Australian system or not.
JOURNALIST: But Ms Gillard, can you explain how this is a disincentive for boat people to arrive in Australia rather than an incentive?
PM GILLARD: Well, I'd refer you to all of the work we did through an expert panel led by Angus Houston, the chief of our Defence Force.
And what Mr Houston and his panel most clearly recommended was that we needed to set up a system where you got no advantage if you got on a boat and got to Australia.
So what we've done is we are equalising waiting periods. So we are saying to people, if you come to Australia, if you are processed and you are a genuine refugee, you will not get a resettlement opportunity permanently in Australia or indeed in New Zealand until you have spent the same amount of time that you would have if you hadn't moved.
So you don't get any advantage by moving: you wait the same amount of time, but you've paid a people-smuggler and you've risked your life.
JOURNALIST: Prime Minister, this is a very small number of refugees you're talking about compared to the vast number of asylum seekers that arrive by boat. Is this more about perceptions rather than actually practically reducing the numbers that Australia is dealing with?
PM GILLARD: Well it is what we've announced. It's 150 places out of New Zealand's 750 place-strong system.
I think, when we are looking at what is a regional problem, collaboration, working together - including working together in this way - is of merit.
JOURNALIST: Have we offered anything to New Zealand financially?
PM GILLARD: Well we just talked about the way in which we collaborate and will collaborate in the future.
We do have people who've expressed that their desire when they got on a boat was to try and get to New Zealand. Now getting to New Zealand from the places asylum seekers come from is a long and incredibly dangerous voyage.
We are talking about some of the roughest and most dangerous waters in the world that people would be trying to cross to get here.
So that means that New Zealand hasn't seen a boat arrive. It's not impossible, but given the treacherous nature of the waters, you'd have to say there's natural barriers that are preventing people from getting here.
But I think it just goes to reinforce this is a regional problem, it's not just one nation's problem, so collaboration on things like intelligence gathering, intelligence sharing, disruption, detection - it's in everybody's interest.
As a nation we are in a position to do that and to resource that and to benefit New Zealand with it-
JOURNALIST: I was asking specifically about any financial incentive-
PM GILLARD: No, no, no, it is just as we've described. What I've just described to you is the nature of the arrangement that is being activated out of today's discussions.
JOURNALIST: Prime Minister Gillard, who asked who for this arrangement? Did Australia ask New Zealand to take the 150 or did New Zealand offer?
PM GILLARD: Some time ago, Prime Minister Key and I talked about people smuggling, the regional nature of the problem, and emerging out of those discussions we came to this agreement.
JOURNALIST: How long ago did you discuss it?
PM GILLARD: We've seen each other so frequently that I'd have to think about at which meeting we had the first conversation.
But it's been over a period of a number of months - I mean we saw each other a number of times last year.
JOURNALIST: Prime Minister Key, do you think you'll take any political heckling or heat from this?
PM KEY: There'll always be some people who have some concerns, but my simple message to New Zealand is you're taking 750 refugees a year - this is simply a debate about where they come from.
JOURNALIST: But doesn't this reward asylum seekers who try and get on a boat to Australia ahead of other asylum seekers from all other parts of the world who want to come to New Zealand, because that 150 is going to decrease the number who get the great benefits of refugee status here, and it's going to favour people who jump on boats and try and get into Australia?
PM KEY: No, I don't think it does, for the very reasons the Prime Minister pointed out earlier.
And secondly, from New Zealand's point of view, we rely very heavily on the work that Australia does on the ground in places where these boats are coming from.
We can try and freeload on that process if we like, but I think as a regional partner it makes sense for us to not be duplicating those resources, not putting more and more intelligence people on the ground to try and work out what's going on.
It's better to use Australia's system, which is very well connected, but in the end we'll take some people through their system.
JOURNALIST: Feasibly though, a person who gets on a boat in Indonesia may well end up in New Zealand.
PM KEY: Could do, but I mean they could also be in a camp in Sudan. I mean in the end we're taking 750 people.
PM GILLARD: And I would just stress, because of the no advantage principle, having got the opportunity to resettle in New Zealand no more quickly than if they had stayed put in Indonesia or wherever they've stopped and contacted UNHCR and local authorities and had their claim processed there.
You do not get an advantage because you've got on a boat.
JOURNALIST: Prime Minister Gillard, can you confirm that Stephen Smith is making a move to WA Labor this year?
PM GILLARD: Stephen Smith is the Minister for Defence, and that's the job he'll be doing.
JOURNALIST: Have you had discussions about-
PM GILLARD: No, of course not. It's absurd.
JOURNALIST: Prime Minister Gillard, can I ask you, just back to the asylum seeker issue: notwithstanding this is a completely different arrangement to deal that you tried to get up with Malaysia, but you had problems with the parliament, because they're obviously in the process.
Is it possible that you will now seek to emulate this type of agreement with other countries in the region? You called it a regional problem or a regional process, but to have a similar sort of view on the process of refugees going to other countries in the region?
PM GILLARD: When we look at our region, there are only a limited number of nations that operate the kind of refugee settlement programme that Australia does and New Zealand does.
That is, we do say to the world that we will resettle refugees from around the world into our nation.
As you know, Australia is on a journey to increase those numbers to 20,000; New Zealand resettling 750.
So in those circumstances, I'm not going to suggest - and we aren't - in active discussions with anybody else in the region at this stage, to enter this style of agreement.
But given our two nations do operate these kind of resettlement programs, it's a natural fit to come to the kind of agreement that Prime Minister Key and I have announced today.
JOURNALIST: Prime Minister, (inaudible) the regional process really isn't working-
PM GILLARD: Well I think you are focussing on one aspect, and that's not appropriate.
When we look at the Bali Process, don't just focus on, ‘are there more arrangements like this?' This is one aspect of the kind of regional cooperation we seek.
The regional cooperation we seek is about people changing their own domestic laws so that they're in a position to make people smuggling a crime. So for example, we've seen Indonesia do that.
It's about people resourcing their own intelligence and domestic policing agencies so that they are able to pursue people-smugglers.
It's about people working together in all of the ways that we have to share information, about who is moving where, people smuggling, all of the things that we do to try and catch the Mr Bigs.
So there's many, many lawyers to the kind of regional cooperation we have. This is one layer, and so you shouldn't judge from one layer the nature of the whole process.
JOURNALIST: Prime Minister, how will you be getting mobile phone providers to reduce their charges before moving in?
PM GILLARD: Well, they're on notice from this press conference today that we are going to give our competition people the ability to intervene in the market.
Clearly we would prefer it if mobile phone companies responded voluntarily rather than required that market intervention.
I do note that we have seen charges come down over the last few years, and I think one element of why that has happened is that governments, Australia and New Zealand, have signalled over the last few years that we are focussing on this issue.
JOURNALIST: Like a 20% reduction by the end of this year?
PM GILLARD: I'm not going to take it further than what I've just said, but there's a clear notice that we will be empowering our competition agencies to intervene in the market, if that proves necessary.
JOURNALIST: Prime Minister Gillard, just on legal migration for a moment. What are the skills shortages facing Australia, and I suppose if Kiwis are looking at moving over there, what kind of Kiwis are you looking to attract?
PM GILLARD: I'd say to anybody who's interested in migrating to Australia, please get onto our immigration website. You will see there the kind of occupations in demand in Australia.
There's a points test about people skills and qualifications. We do offer New Zealanders access to our labour market; they're the only people who do get that free access to our labour market.
But if they want to become citizens, then there are plenty of opportunities if they've got the kind of skills that will help bolster the Australian economy.
JOURNALIST: Prime Minister Key, did you raise any concerns with Prime Minister Gillard about the way New Zealanders are treated in Australia - the conditions that they enjoy?
PM KEY: We had discussions on that issue, and yes it's fair to say we have made representations for those New Zealanders, but we'll go back to the point I was making to my press earlier this morning.
This isn't something that Australia enforced on New Zealand.
It was a negotiated agreement that took place about a decade ago, so the vast bulk of New Zealanders that go and live in Australia, they do enjoy all of the conditions that a permanent resident or a citizen can in Australia, and they even can become permanent residents or citizens, and indeed do.
So yes, there are some isolated examples and maybe over time there'll be more work that will take place, but I just say to New Zealanders, if they're thinking about going across the Tasman, they need to fully understand what that might mean for them and what the pathway for residency might look like.
JOURNALIST: Are you disappointed though that you've had this request knocked back?
PM KEY: I don't see it as being knocked back. I mean we have ongoing discussions as always about our citizens in Australia, just as the Prime Minister does if there are issues here in New Zealand.
The most important thing really for the vast bulk of New Zealanders is that they have access to that Australasian labour market if they choose to want to move.
And that's the basis of the agreement that was reached back in 2001, and that still stands. That would be of a major concern to New Zealanders.
JOURNALIST: Prime Minister, 54,000 Kiwis left to move to Australia permanently last year. Is that a wake-up call for your Government?
PM KEY: No, it's a recognition that in Australia there's a mining boom taking place, and if you look at places like Western Australia and the Northern Queensland area, there's been huge capital investment going in, and that has sucked people across the Tasman into those areas.
That's one of the reasons why the Government is taking the steps on this side of the Tasman to try and expand our footprint in mining and exploration.
JOURNALIST: Does it tell you the Government hasn't addressed the core issues of why Kiwis are leaving?
PM KEY: No, I don't think so. If you go back to the point I made earlier. If you look at what's been happening in Australia, they've had a different economic profile from pretty much every other OECD country.
They've been growing very rapidly, but that has been driven very heavily off a mining boom which is phenomenal and probably will continue for quite a long period of time.
JOURNALIST: Can our economy afford to lose those people?
PM KEY: Well, our net population continues to rise pretty much year in, year out.
So yes, of course, we want to keep people in New Zealand as much as we can, notwithstanding there'll always be some New Zealanders that will go and live in Australia and other parts of the world.
You went overseas for a while, and guess what, you've come back. So it's not unique to everybody. Lots of people do that. I did the same thing as well - we shouldn't get too wound up about it.
JOURNALIST: Would you like to see Sonny Bill Williams come back?
PM KEY: I'd probably like to see Sonny Bill Williams have a rematch.
JOURNALIST: Will your cooperation on cyber security strike problems because of your different attitudes to China and Huawei?
PM KEY: No, I don't think so. Our officials continue to exchange views and understanding of the perspectives and what's taking place.
I'm not in a position to go through all of the reasons of why New Zealand has made the decisions it has made in relation to Huawei but I am in a position to say I'm comfortable and remain comfortable in the advice I've had from my most senior officials in that area - that we are taking appropriate steps.
But the involvement of that particular organisation in different parts of the telecommunications sector varies around the world, and it's not unique to New Zealand, that Huawei operates. They're a very significant player in lots of countries, including the United Kingdom.
JOURNALIST: Prime Minister Gillard, why didn't Australia want to have Huawei in its broadband network?
PM GILLARD: Well I think we've just got to be a little bit clear here. Huawei trades in Australia and employs Australians and does all of the things you would expect a big corporation to do.
We took a particular decision about our National Broadband Network which we dealt with publicly at the time, so I'd refer you to the remarks back then.
I think we are in a rush.
PM KEY: We are out of time. Thanks very much.