E & O E - PROOF ONLY
HOST: Prime Minister, thanks for joining us.
PM: Thanks Leon, it's great to be here.
HOST: Just breaking news, Telstra have announced Sensis are getting rid of 650 staff. You're reaction?
PM: That's dreadful news, really dreadful news particularly for the staff members who are hearing that today.
It's always incredibly tough when someone loses a job, Leon. That's why we do so much to try and make sure that there are job opportunities in our nation because you need a job to build a life for you and your family.
HOST: I want to talk about the innovations package that you announced a couple of days ago. Now there are two things about it that put a slight fly in the ointment.
One is that Treasury have suggested that the savings that the Government think they'll get may not be realised but more importantly the Greens have announced today that they won't support this package unless you give something to them and they're looking at a change for the mining tax. Would you be prepared to go back and revisit that?
PM: Look, I'm not dealing with the Greens on that basis. We've said what we've said about the Minerals Resources Rent Tax. We've said we've got no plans to change it. There's an ongoing process between us and the states about royalties.
But Leon, let's just get serious about this, are the Greens really saying that they're going to come into the Australian Parliament and vote against Australian jobs?
Are they really saying that they're going to come into the Parliament and vote for some of our biggest companies including mining companies to keep a tax break which we want to use to support Australian jobs?
And the Greens only matter if Mr Abbott directs his team to come into the Parliament and vote against Australian jobs.
HOST: So from your point of view, Christine Milne has announced today that they're not going to pass this jobs innovation package without giving them something that you don't want to give, so they can block it.
PM: They can only block it if the Liberal Party votes against Aussie jobs. Now I know Mr Abbott and his team have been saying they will do that, vote against Australian jobs.
They have in the past, Leon, they voted against the stimulus package that supported 200,000 jobs but let's actually get to the parliamentary moment.
What I find, Leon, is a lot of the positioning and stalking around in the media, by the time you get to the actual vote in Parliament, doesn't follow through.
HOST: Okay, I want to ask you about this jobs issue because one of the blindingly obvious points about jobs in Australia is supporting the local brand.
Now, I want to talk about labelling for a moment because I think this is a huge issue here.
There's no doubt that when you go out and buy stuff, particularly food, the labels are very confusing, made from important and local ingredients.
Customers want to know that when they go to a shop they want to know what it is, what's in it and where it's from.
Now we still have, even Neil Blewitt admitted on this program 18 months ago, that there is an anomaly where an exporter can send something to New Zealand, make them repack it, send it here as a product of New Zealand but it really isn't. Are we going to fix that?
PM: Leon, I think that is a real area of concern and we did have Neil Blewitt do some work for us on food standards and food labelling.
I am always in the cart of better and better transparency and people will make their own mind up-
HOST: Would you fix that?
PM: I'm happy to keep working on it. Of course there are costs involved in this when big businesses and small businesses need to change the way in which their packages are printed up.
But I am generally in your cart, that as a consumer you should be able to walk in and say, that's a genuinely Australian product. You should be able to walk in and say, that's genuinely a free-range egg.
If you want to make consumer choices you should have the information you need.
HOST: I'm pleased to hear that in principle you support it but we are coming up to an election. It's an election winner in my view, a no brainer, to go to the people and say, we will close this anomaly.
Now I'm not against imports and the people listening aren't either but what we do want is to make sure our food is safe.
And that's another issue because we've got stuff coming in here that's either of lesser quality or contaminated with chemicals that are banned here. You wouldn't be happy with that, surely?
PM: Well we do have good food safety standards and we do have inspections and monitoring but I think it's this question of consumer preference and consumer choice.
Leon, at the end of the day we make Government policy because it's the right thing to do not because we're looking at it being election year.
So I'm certainly prepared to say to you, in principle I do think it's very important consumers get clear choices.
HOST: Chris of Golden Grove you're talking to Julia Gillard.
CALLER: Good morning Prime Minister.
PM: Good morning.
CALLER: I would like an answer to this question. If you are re-elected at the election this year will there be a carbon tax on fuel starting on 1 July 2014?
PM: There would be carbon pricing for heavy road haulage. That's part of the carbon pricing package and that's already been announced.
HOST: Is that fuel?
PM: Yes, on heavy road vehicles, you know, the huge trucks.
HOST: Yes, sure.
PM: But there would not be carbon pricing on the petrol that households use or that light commercial vehicles use, or petrol or other fuels.
HOST: So commercial vehicles of a large size will pay a carbon tax on their fuel. That will be passed through to the consumer won't it eventually?
PM: Yes Leon, we were always upfront about that and weren't we right.
We were right when we told Australians that there would be carbon pricing passed through to the things that they bought, that the change would be 0.7 per cent, less than 1 per cent of CPI and that figure work has been right.
It has not been any more. All of the nonsense that people have had to listen to of $100 roast and all the rest of it - wrong, wrong, wrong.
And what that means is that the assistance we've given people - pension increases, family payment increases, a change to the tax free threshold so you don't pay tax until you've earned $18,200 - that that money is there and helping families in the way we thought it would.
HOST: We've got a call now from the Dairy Farmers Association's David Basham. David, you're talking with the Prime Minister.
CALLER: Good morning. Prime Minister, when the carbon tax was introduced it was clearly stated that agriculture was excluded.
The dairy industry is a high energy user, both as at farm level and at processing level and it's estimated that it's going to affect the average dairy farmer by $14,000 to $25,000 in extra costs.
We can't pass this onto any of our customers because we complete in a world market and competing with countries that don't have the same unfair tax burden, and we also have in the domestic market the retailers saying they won't pass any of the costs onto the consumer.
What is the Gillard Government going to do to make sure the carbon tax does not destroy any chance of the dairy industry's surviving the current industry difficulties?
PM: Well the industry will survive. It will not only survive it will thrive. Carbon pricing isn't a theoretical proposition, it's here, it's working and so are our dairy farms.
HOST: A lot of them shutting though.
PM: But Leon let's be really practical about this. Has the fear campaign about carbon pricing come true? Carbon pricing started in the middle of last year.
Have you seen astronomical price increases? No. Inflation is very modest and the inflationary effect is not more than we anticipated. Have you seen the economy grind to a halt and us thrown into a depression? No you haven't.
HOST: The insolvency rate in this state-
PM: But Leon, I'm not going to have you associate that with carbon pricing.
HOST: I'm not doing that.
PM: Because that's not fair and that's not right.
HOST: No, no, no, no, no. Prime Minister, I'm not doing that.
PM: So let's finish with carbon pricing and then I'll be very happy to talk about the insolvency rate.
I want to make this point and make it very strongly. People had to listen to all sorts of nonsense from Mr Abbott and his team about the impact of carbon pricing.
Here we are, people can judge for themselves, they know what's happened. None of the fear campaigning has proved true.
So that's it, carbon pricing - done. The impacts that we said would happen have happened. The money flowing to families is flowing to families.
The debate for our nation now is whether or not they want to go with Mr Abbott's crazy suggestions that he would get rid of carbon pricing in a few months, throw our economy into turmoil and rip money out of the hands of families.
HOST: Okay, I want to ask you about the five year trend on ASIC's information here. Insolvency in South Australia 32 per cent, on average it's 23.
So we're doing it a little worse, in fact, marginally worse than anywhere else in Australia.
You are telling me people that economically, compared to the rest of the world, things are not too bad. But the insolvency rate over five years has gone up nearly a third. That's not a good message is it?
PM: No, it's not and let's be clear about what we are saying to people about the economy because it's a story that needs to be understood in detail.
I mean, we did come out of the global financial crisis stronger than nations around the world. We kept growing. We didn't have a recession. We've got relatively low unemployment.
So there's a lot to be proud of in our economy: low inflation, relatively low unemployment, low interest rates, strong public finances.
But then when you get to the details of what's happening in different states and different industries, our economy is undergoing this huge transformation driven by the strength of the Australian dollar.
And our dollar's strong because resources are strong and we're seeing big capital inflows to build big resources projects.
It's strong because we kept strong during the global financial crisis and people are viewing us as a safe haven currency.
Now that puts a lot of pressure on. Strong dollar means, if you're a manufacturer and you make something and you used to sell it to a European for €500, our currency has gone up so much that to get take same product that European now needs to give you €750.
So a lot of pressure on, a lot of change and churn in the economy-
HOST: It's actually worse than that because-
PM: Which is why we've charted the long term course with the plan for Australian jobs.
HOST: Much of the food coming out of Europe has subsidies of 23 per cent so it's not just the high dollar. It's the taxpayer subsidies that we endure and our growers have to compete with.
PM: And Leon, we fight them. We fight them internationally.
HOST: How do we fight them?
PM: We fight them through trade organisations. We fight them when I go to international meetings with fellow leaders. We say we believe in trade that can happen and no unfair subsidies in it. We want our producers-
HOST: But we're still enduring them.
PM: Let me assure you we'll keep the fight up. I'm not pretending to you we've won the fight. But we fight to get our producers on a level playing field.
HOST: When other countries do things to us that make is hard for our exporters, we will often say we don't like it but we won't do anything practically.
PM: No, we do take cases to the World Trade Organisation. We take people on. That does happen.
HOST: Have we won any?
PM: We've been through cases, I'd have to go through the list Leon, but we do challenge them.
HOST: I want to talk just briefly about electricity. You made a promise to Australia a while ago that you through that you could get $250 off the average power bill.
Now there is a major problem here because when power companies charge consumers they charge for the carbon excess, if you like, that they are going to use.
We all have to pay that, right. And then, and you compensate for that, but those companies then get compensated for the money that they've just charged the consumers for.
PM: No, there's been some false reporting about that in the last few days. There was some report put out, Greg Combet's dealt with it and it's just simply wrong.
HOST: Well I spoke to Laurel Fox-Allen from Electricity Week and the power companies are able to go back under the rules that were made in 2008. Because we thought at that time that we had a problem with electricity and we did.
But now we've got wind power and we've also got solar, which is working very well, so the peaks that we used to have that put our prices up don't exist anymore yet we're still being charged for them.
PM: Well let's deal with that and let's unpack it very clearly. We said to people that putting a price on carbon would put up electricity bills by less than 10 per cent. We were right.
HOST: Businesses pay more though.
PM: Less than 10 per cent for consumers, this is the important thing, and we were right. The changes in power prices as a result of carbon pricing, they're all in, you can see them and it's less than 10 per cent.
So that also means that the money we gave families to help them through was figured right.
Then separately to all of that, separately to carbon pricing, we've had big increases in electricity because of investment in poles and wires and there are some distortions in the system now that give people an incentive to just keep investing, keep investing, keep investing and making money back.
HOST: Can you deliver on the $250 that we promised?
PM: We agreed that the last Council of Australian Governments meeting a new way forward, a new set of rules which will deal with those odd incentives that there are in the system at the moment which are truly adding to people's electricity bills.
HOST: Just quickly, how helpful is Kevin Rudd to your re-election?
PM: Look, I expect members of the Labor team to be out there campaigning for Labor values and the Labor Party.
HOST: You feel totally safe as leader between now and September?
PM: I dealt with all of this last February, I dealt with it all last February and there's nothing more to say.
HOST: Prime Minister, you've got members of your party backgrounding the media on matters such as this. You wouldn't be happy with that surely, would you?
PM: Leon, I don't get distracted by any of this. We had a ballot last February. We resolved the issue of the Labor leadership. That's where it lies. Done.
HOST: Just quickly, GST. We get $1.26 per dollar GST. A lot of other states want to reform. Are you going to do that in the next few months or are you going to leave it as it is?
PM: I'll always make sure that South Australia gets supported. There's stalking around about this issue.
I do note that the other side of politics when they're in Western Australia say we're going to get you more but when they come here they don't say to South Australians that means that we're going to give you less.
I'll never go for a system that punishes states like South Australia.
HOST: Prime Minister, thanks for coming in.
PM: Thank you very much.
[ENDS]