PRIME MINISTER CLARK:
Well this morning we've had a very good exchange between the Australian Prime Minister and the New Zealand Cabinet, an opportunity for a briefing both ways - Mr Howard briefing us on the state of the Australian economy and some of the policy areas which are going to be prominent in his recently newly elected, re-elected government's programme. In turn we were able to brief him in some more detail on some of the initiatives occurring here, the benefits simplification which is of considerable interest given that Australia itself has had this on its agenda in the past and we'll look with interest at how we're actually going with it. Paul Swain spoke about the work we're doing on productivity and as I said at the press conference in Auckland yesterday I see more room for talking across the Tasman on that particular issue. Michael Cullen was able to update John Howard from his perspective on how the discussions had gone with Peter Costello last week. We had three Ministers present with Australian counterparts at a major ministerial meeting in Queenstown last year and Jim Anderton was able to talk about some of the issues covered there across the economic development, trade, commerce portfolios.
We've talked a little about some of the health issues. Obviously New Zealand has taken a great interest in any implications that the FTA with the United States might have for pharmaceutical regimes, I think we're of one mind on being very committed to our equivalent of the Pharmaceutical Benefits Scheme in Australia. So it's been a good policy exchange and we've all learned something from it and it's been a pleasure to have Mr Howard at our Cabinet again, he's been a very regular visitor to our country as Prime Minister, this is the eighth time and we appreciate the personal interest he's taken in the relationship and the commitment he has made to us. John.
PRIME MINISTER HOWARD:
Well thank you very Helen. It was again a good opportunity for me to meet all of the members of the New Zealand Cabinet. Rather timely because as is widely known in Australia our Cabinet will meet tomorrow and it will be one in a series of Cabinet meetings that we've had in Australia called strategic cabinets which is designed to look at some of the big issues over a longer period of time. And that strategic cabinet will, as I think the Australian press contingent know, be addressed by the Governor of the Reserve Bank of Australia. As well as talking about the economic outlook we will also focus on issues relating to workforce participation, the transition from welfare to work, and all of the major policy areas that impinge on those particular matters. And therefore I found the discussion I had this morning on some of those issues as being particularly helpful. The Australian economy and the New Zealand economy are both performing very strongly, we obviously feed off each other in different ways in a very positive fashion and I remain intensely committed to not only the close personal and political relationship between Australia and New Zealand but also the very strong economic relationship. And today's gathering and yesterday's discussions with the Prime Minister and her senior advisers has been another opportunity for me to contribute I hope to the further strengthening of that relationship.
JOURNALIST:
Mr Howard, on the issue of welfare reforms, will you forcing single parents back to work or into training once their children reach a certain age?
PRIME MINISTER HOWARD:
We're not in the business of forcing people to do things that are unreasonable. We believe that it is in the interests of children when they are very young to have proper caring arrangements and if that includes the full time care of a parent well I can't think of a better caring arrangement. In other circumstances it can mean other arrangements, it depends on the choice of the parent. We are looking at matters in this area, and I think that's desirable but we're not in the business of punishing sole parents. If you look at the family tax benefits that we have introduced over the last nine years, low income, single income families, whether two parent or one parent, have been the greatest beneficiaries of that new system and that more than anything else is an earnest of our continuing good intentions in that area.
JOURNALIST:
You spoke about New Zealand's policy of having one (inaudible) it sounds like you'll be watching that pretty closely, is that something you might seriously consider down the track...
PRIME MINISTER HOWARD:
Well we are interested always in what similar countries do in these areas. We can all learn from each other. There was a strong element of this in what Patrick McClure recommended. But once again the purpose of any change in this area, and I'm sure this applies to New Zealand as it does to Australia, the purpose of change in this area is not to cut benefits, it is to simplify and make more efficient and make more readily understandable. The complexity of the delivery of social welfare and often - I mean mind numbing descriptions that are sometimes used to describe benefits is something that can always be looked at. But we are not in the business of cutting benefits, speaking from Australia's perspective, I don't presume to speak with specificity about New Zealand, but from Australia's point of view there is always a case to ensure that people who are not entitled to something don't get it and there's always a case to put that people should be encouraged and helped and provided with incentives to leave welfare and to go back into work. And I'm quite unapologetic in arguing for that. We think it's a good idea that people be encouraged off welfare to go back into work and that's the philosophy that will overhang everything that we do. But we'll do it in a way that respects the fact that there are some people unable to work.
JOURNALIST:
Mr Howard, is this driven more by ideology or more by the need to increase workforce participation given what you said yesterday, both economies are becoming (inaudible)?
PRIME MINISTER HOWARD:
Overwhelmingly workforce participation is the driver because we have a problem, we are running out of workers, we are an ageing population, we are running at full capacity, it's harder to get skilled migrants, because we're an ageing population the number of people coming into the workforce is declining so therefore you have to look at ways of encouraging in an appropriate fashion people who are now out of the workforce to come back into it.
JOURNALIST:
So it's not punitive?
PRIME MINISTER HOWARD:
No, definitely not punitive. We are not on a punishing mission here. We're on an expansionary mission, we want to expand the participation of Australians in the workforce and there's nothing punitive about that, it's visionary and forward looking and recognising that unless we do something about it now we're going to have problems down the track.
PRIME MINISTER CLARK:
With the growth of both economies we're basically ending up rather short of workers and the push factors which half a century ago brought many migrants from southern Europe to Australia no longer apply, a lot of the push factors which brought people from Britain and Holland to New Zealand. They no longer apply. Our society is ageing, at the younger end people spend longer in tertiary education, we have a lot more people who require care because of older age or other frailty or disability, so we're short of workers and of course everyone is going to look at how they can encourage more participation, the first step is to get your unemployment rate down and then you look at other areas where there might be room for more participation and see how you can encourage people. We briefed John today on the working for families package which supplements low and modest income family income in New Zealand with big improvements coming from the 1st of April and one of the steps we've taken is to pay an in-work payment to ensure that a family will always be better off in work than on a benefit. So that's part of the carrots of encouraging people to look at work.
JOURNALIST:
Prime Minister, did you get any updated reports on the security situation in Indonesia today, did you discuss that?
PRIME MINISTER CLARK:
We haven't discussed that today but I think it is important to say that that threat which was deemed to be credible and which strengthened travel advisories were issued on the basis of is not the reason for the New Zealand and Australian Defence Forces looking now at bringing to a close the relief phase of the operations they've had in Sumatra and Aceh specifically. They're two quite distinct things. Obviously the relief phase as we said yesterday is drawing to a close.
JOURNALIST:
How does it make that threat (inaudible) advisory given for example (inaudible) the American Embassy in Jakarta isn't matching it?
PRIME MINISTER HOWARD:
Well can I just say, speaking for Australia, that we act on advice we get, we didn't issue that travel advisory lightly and we stand by it. I don't intend to say any more than that.
PRIME MINISTER CLARK:
And the only point to add to that is with the history of terrorism in Indonesia, if you have a threat which you think is credible you don't sit around waiting to see whether it's going to transpire or not, certainly Australia has been very much on the receiving end of terrorist activity there, we ourselves had loss of life in Bali and many traumatised persons. If the advice we have is that the threat is credible we will act on it.
JOURNALIST:
Do you still believe the intelligence is credible?
PRIME MINISTER HOWARD:
Can I just in answer to Greg Jennett, is it? The answer is yes. I discussed this matter yesterday afternoon with the Foreign Minister and the answer is yes.
JOURNALIST:
So there are (inaudible)?
PRIME MINISTER HOWARD:
I don't Mark intend to go further.
JOURNALIST:
(inaudible) any more details about Gallipoli (inaudible)?
PRIME MINISTER HOWARD:
Well beyond saying, that it will follow a format that has been followed in the past and there are some details about the pre-commemoration activities which we're looking at and we'll be very satisfied. I'm sure that it's appropriate and dignified and I don't think we should sort of start building an issue that doesn't exist, there will be speeches from, brief speeches from the Prime Minister and myself, there will be a format which is very familiar to the people of both of our countries, there will be a separate service at Lone Pine which I will attend of course and a separate service at Chunuk Bair which the New Zealand Prime Minister will attend, we will both attend the international service and I think it will go appropriately and well and I am very happy with the co-operation that Australia has with New Zealand on this issue.
JOURNALIST:
Have you been (inaudible)
PRIME MINISTER CLARK:
Of course we have.
PRIME MINISTER HOWARD:
Yes, yes.
PRIME MINISTER CLARK:
Of course we have and we expect that he will attend and I'm absolutely confident that we're going to have a 90th anniversary which will be solemn, dignified, appropriate and it will be an anniversary that people who are there will always remember.
JOURNALIST:
(inaudible)
PRIME MINISTER CLARK:
Whatever happens will be dignified.
JOURNALIST:
Mr Howard, just on a domestic issue back home...
PRIME MINISTER HOWARD:
I beg your pardon?
JOURNALIST:
Just on a domestic issue back home, was Tony Abbott right to go public before notifying his son's adoptive parents?
PRIME MINISTER HOWARD:
Look that is a personal matter, a personal matter, and can I...
JOURNALIST:
How do...
PRIME MINISTER HOWARD:
No just let me finish. I think it's a wonderful story, speaking personally, but I'm speaking as John Howard, a friend of Tony Abbott's, and as somebody who respects in him the qualities of a very decent human being. But I don't see it in any way impinging on our relationship as Prime Minister and Minister and I have a great deal of regard and affection for Tony and I wish him well and I don't really think it's appropriate for me to say any more. I'm quite sure that he's taken all of those things into account and I can only say that from what I've heard it's a very heart warming story.
JOURNALIST:
Did he discuss it with you before...
PRIME MINISTER HOWARD:
We have a lot of discussions about a lot of things and I take the view that when personal matters are discussed they remain what they are. Except, I just want to say, it's got nothing to do with his political responsibilities and I think people are entitled, I mean he's chosen, that's a decision and I'm sure he's done that in a responsible way as he always does but it's not for me to express a view on whether or should or shouldn't have, that's for him. But I can only say I find the story very heart warming.
JOURNALIST:
(inaudible) on the issue of the moves towards the single economy and we know the bulk of that's been driven by the finance ministers, but are you in agreement that both countries need to bite the bullet over some of these big business related agencies being (inaudible) or whatever and make some fundamental changes if you're going to go where you want to go (inaudible)?
PRIME MINISTER CLARK:
Well when, actually before the meeting neither had John Howard been able to get a good briefing from Peter Costello and I hadn't had the chance to get a good briefing from Michael Cullen, so I think we both listened to Michael this morning with a lot of interest because he gave a good briefing. What I think we would both have taken from it is that there is a positive will to harmonise to the greatest extent that we can without offending anybody's sovereignty and there is scope for building, I think, some genuine trans-Tasman institutions. We've been having a shot at that in other areas and the work is being approached with goodwill. I don't think it would be useful to go beyond what the Treasurers have said. Obviously there was a great deal of activity, obviously a particularly sensitive area is around the banking area, but the terms of reference are to be worked on for a trans-Tasman supervisory body of some kind and we're all ears and await further development.
PRIME MINISTER HOWARD:
I can't add anything to do that except make a point that some of the Australian journalists will recognise I've made in other contexts and that is that it's the substance of an economic or trade relationship that matters, I think we can get too hung about the formal architecture, we should worry about the substance. And the substance is that it gets better and better each year.
JOURNALIST:
(inaudible) single migration zone (inaudible)
PRIME MINISTER CLARK:
It actually wasn't a single migration zone, it was about common border for goods and that has a tremendous amount going for it and I'd be very positive about it. What we're trying to achieve here is the least possible complication in the way of trade in business, goods and services across the Tasman. And so a common border where what was accepted for entry into one market over one border is accepted in another has a tremendous amount going for it.
JOURNALIST:
(inaudible)
PRIME MINISTER CLARK:
Well that, from what I heard about the meeting understood that the focus was much more on the goods transfer rather than people. Obviously we have some different emphases in our immigration policies. For example Australia for its own reasons which we respect are required visas of everybody except in affect New Zealand. We have more visa free arrangements than Australia does, considerably more. So those are issues, but I think if we focus on the single economic market the focus is on how can we get the best for our growing economies through the least complications and the way of doing business. And that's the priority right now.
JOURNALIST:
Mr Howard, has the issue of trans-Pacific air routes been discussed during the visit here? And if not would you undertake to consult New Zealand before opening the door in any way to Singapore?
PRIME MINISTER HOWARD:
Well the answer is, the first question is no, the answer is to the second question is that we'll do whatever is appropriate.
JOURNALIST:
(inaudible) the skills shortage that both countries have suffered. The speed with which the skills shortage will impact on our respective economies, does that make a relaxation, a further relaxation on immigration intakes inevitable for both countries in the short term, and does the longer term solution to that problem not bring you both back to tax cuts? Or further tax incentives, inevitably?
PRIME MINISTER CLARK:
I'm not sure quite what that's got to do with the (inaudible). But you know in some circles tax cuts are put forward as manna from heaven and the solution to any problem, I don't subscribe to that. I think there are some longer term issues for ageing societies like our own and over time that will lead us to address not only issues around migration and participation and lowering unemployment and so on, it will also cause us to address what activities we continue in our economy because if we don't have large low paid unskilled workforces to do work that's traditionally been available then that's a further motivation for moving your economy up the value chain to where you require more specialised, more skilled and essentially a smaller workforce over time. So I think they're some very big issues here.
JOURNALIST:
How do you think a single benefit system would work in Australia?
PRIME MINISTER CLARK:
Well what our Minister briefed Mr Howard on was two things - the benefits simplification and a new service delivery model and I think both were of interest to a country very close to ours which obviously takes an interest in our policy as we do the other way. In terms of benefits simplification we currently have 10 benefits and 36 kinds of add ons. The estimate that our policy advisers have made is that we could reduce the amount of time spent on actually administering the benefits system (inaudible) from about 70 per cent of the (inaudible) time to 30 per cent, that then frees up the time to focus on how you support people moving from dependence on a benefit across to more independence and hopefully back into work if that is at all possible, which it isn't always, some people are on long term pensions because they are very sick, have serious disability or whatever. The other thing our Minister briefed on was the number of the innovative ways New Zealand is working to reduce the numbers of people on sickness and invalids benefits, some of the case management there. So I think there's a lot of ideas sharing that can go on in these areas.
JOURNALIST:
The Australian (inaudible)
PRIME MINISTER HOWARD:
Are you addressing this to me because if you are I can't hear it.
JOURNALIST:
The Australian (inaudible)
PRIME MINISTER HOWARD:
There's a band of what?
JOURNALIST:
(inaudible)
PRIME MINISTER HOWARD:
That was one of the recommendations of the McClure report and we are implementing that report in stages.
JOURNALIST:
Mr Howard, do you have a comment in relation to the crowd behaviour at the cricket?
PRIME MINISTER HOWARD:
Well from time to time some people in all countries misbehave at sporting fixtures, it is not peculiar to New Zealand, it's not peculiar to Australia, there's a wide incidence of it of course in England when it comes to soccer, it happens to Europe, it happens in South America, so I think I ought to start off by saying when there's bad behaviour we shouldn't sort of get too sort of self-righteous, you have larrikins and hooligans, I won't say larrikins that's a rather endearing term in Australia, but you have you know yobbish behaviour and bad behaviour occasionally in all manner of sporting fixtures and it's always regrettable but it is certainly not limited to any one country or group of countries, let's understand that.
JOURNALIST:
Have you considered the situation of security between China, Japan and Taiwan?
PRIME MINISTER HOWARD:
Well my very strong view is that there's an obligation on everybody to keep the temperature in that part of the world at a very low level, at freezing point if possible. We have an interest of course in ensuring that the differences between China and Taiwan, within the context of a one China policy which we hold to, are resolved peacefully, that is a view we put to our friends in America and in Japan and also to our friends in China. And we'll continue to argue that case and to argue it very strongly.
PRIME MINISTER CLARK:
Right. Thank you.
PRIME MINISTER HOWARD:
Thank you.
[ends]