TAYLOR:
Prime Minister Howard, thank you very much for joining AM. You've said that the Labor Party's and the trade union movement's IR changes are a dagger at the throat of Australia's most successful industry. If a business though like Spotlight were to put employees on AWAs, would they be doing as well as miners are?
PRIME MINISTER:
Forty-three per cent of everybody employed in the resources sector in Western Australia, which is the principal source of our exports to China, and the principal source of our resource exports, are on AWAs. And let's not deal in hypothetical examples, let's deal in reality. And the reality is that the resource sector needs the flexibility of AWAs. If you get rid of AWAs you will seriously damage the resource sector, you will cut the wages of thousands of people employed in the resource sector and you will interrupt this wonderful expansion that's gone on. I mean why we would want to cut into something that has been so incredibly successful is quite beyond me, and I think it will be beyond the reasoning of most Australians.
TAYLOR:
Aren't miners a special case though because demand for Australian resources is surging, especially from places like China?
PRIME MINISTER:
I'm not disputing that demand is very strong, but the whole idea of running an economy successfully is to have an industrial relations system that is flexible enough to accommodate industries that do particularly well. And that's the whole idea of our reforms, to give employers and employees the flexibility they need to take advantage of opportunities, not to go back to an old fashioned system which would take away incentives, cut wages and generally undermine, even cripple, one of the most successful industries that this country's had.
TAYLOR:
Do the protests show though that there is significant community concern about your IR changes?
PRIME MINISTER:
People are entitled to demonstrate providing they do it within the law. I think what the demonstrations show is that the unions can still turn people out at rallies. But you know the old story about silent majorities. Ninety-eight, 99 per cent of people didn't participate in the rally, so I don't think we should be too impressed by some thousands of people demonstrating. They have a right to do it, and I don't condemn them for that, I condemn the Labor Party and the union leadership for wanting to undermine one of the most successful industries that this country's ever had.
TAYLOR:
Turning to China and the $25 billion LNG supply deal. Were you able to convince Premier Wen Jiabao today that he'll have to pay higher for energy prices for similar deals in the future.
PRIME MINISTER:
The Premier, when he was in Australia in April, acknowledged that market forces would ultimately rule the roost when it came to resource sales and nothing he said today was different from that and nothing I said today was different from that. In the end we live in a competitive market. I think I may have said at my news conference that the forces of competitive capitalism had to be influential in the resources sector. I'm sure the Chinese understand that.
TAYLOR:
You sent a clear message that the first LNG deal should stand as it is. Australians don't welch on contracts, was what you said. Were you worried that any change or pressure to renegotiate this contract could jeopardise future energy deals between Australia and China?
PRIME MINISTER:
No, I was responding to a particular question and I was making the obvious point that sanctity of contract is a very important thing in commercial dealings. If parties agree to vary the terms of a contract, well you're not welching on it, but I was making the obvious point that sanctity of contract is very important. But these are matters for the parties. I don't determine price. All I do, as best I can as Prime Minister, is to create a congenial environment where the goodwill and the assurance of Government support and understanding enables people to make deals that suit both of them.
TAYLOR:
Do you expect future LNG or energy deals to be at a better rate, a higher price than this first...
PRIME MINISTER:
Well that is a matter for the parties and it will depend upon the forces of supply and demand at the time the deals are negotiated.
TAYLOR:
You've stressed how good relations are at the moment between Australia and China by focussing on the things that the countries have in common and the mutual benefit that both countries can derive from acting cooperatively. But do you believe though that the ruling Communist Party is doing enough to promote political reform in this country so that the Chinese people can enjoy the same freedoms and rights that Australian people do?
PRIME MINISTER:
I have never disguised my belief that China is an authoritarian country. China is not a democracy. China differs from Australia in relation to all of those things and I don't pretend otherwise. But as a realist and as somebody who has my own country's interests right at the top of my priorities, nothing is served by delivering endless lectures to other countries, particularly countries that are friendly to Australia that have different political systems.
TAYLOR:
Do you think though that we're having any impact upon China's political system?
PRIME MINISTER:
I think to the extent that economic growth proceeds in China, to the extent that China becomes more and more involved in the process of globalisation, to the extent that China is more and more exposed to the democratic world, over time that does have an influence.
TAYLOR:
On North Korea, the international standoff on North Korea continues over its efforts to develop nuclear weapons and it seems that essentially what's happening is North Korea's being given more time to act. You now have concerns that North Korea may be about to test a missile. Is it time for China to get serious?
PRIME MINISTER:
I spent quite a bit of time encouraging the Premier to the view, and I think he accepts that no country can influence North Korea more directly than China and that any provocative behaviour by North Korea, such as the test firing of a missile, would set back the cause of resolving this issue peacefully a great deal. It's important that we continue the pressure for a peaceful resolution. China does not want a nuclear armed North Korea. The Premier made that very clear to me. We don't want it, the Americans don't want it, the Japanese don't want it, South Koreans don't want it. Let's patiently continue the process and let's not ever run out of patience in relation to something like that.
TAYLOR:
But how long can you be patient for before it becomes counterproductive?
PRIME MINISTER:
While ever people don't behave in a provocative fashion and while ever we maintain the status quo, we should continue to be patient.
[ends]