PM Transcripts

Transcripts from the Prime Ministers of Australia

Howard, John

Period of Service: 11/03/1996 - 03/12/2007
Release Date:
14/05/1999
Release Type:
Interview
Transcript ID:
11039
Subject(s):
  • Response to Senator Harradine
Released by:
  • Howard, John Winston
DOORSTOP INTERVIEW - WATERFRONT PLACE, BRISBANE

E&OE................................................................................................

Well, ladies and gentlemen, I just called this short conference to

say a few things about the statement that Senator Harradine made in

the Senate this afternoon. Needless to say I'm disappointed that

Senator Harradine has indicated that even with the significant increase

in compensation which the Government proposes to make, he is unable

to support the package.

Let me first of all outline to the Australian people the additional

compensation which I told Senator Harradine yesterday with the Treasurer,

the Government intended to make. Firstly in relation to pensioners

we intend to increase from 4% to 5%, the compensation factor for pensioners

and allowees. We also intend to increase from 25% to 26% the percentage

of male total average weekly earnings linked to the pension. Those

two measures represent a dramatic increase in the level of compensation

available to pensioners in particular, and also in relation to the

5% allowees.

It has been our view that the current proposals are adequate, but

we took account of concerns expressed not only by Senator Harradine,

but by others, that in their view the compensation should be higher.

We didn't believe that those arguments were compelling but we

did believe that there was a capacity to provide more compensation.

Therefore it was resolved by myself and the Treasurer that that additional

compensation should be offered.

We also have resolved that in relation to families, within the existing

family allowance arrangement there is a special loading for families

with four or more children which represents an additional $15 to $16

a fortnight. It's our intention to double that allowance, and

furthermore it will in future operate from the third child onwards,

and not the fourth child onwards as now obtains.

The third alteration relates to self-funded retirees. We intend that

the bonus payable to self-funded retirees should be increased by $500

and that that additional $500 should be payable in the second year

of the package, that is the year 2001-2002. Of equal importance we

intend that the special bonus for self-funded retirees should be available

to self-funded retirees who are aged 55 or over, which represents

a significant liberalisation of the existing arrangements.

Two or three other matters were discussed with Senator Harradine.

The first of those was that we indicated a willingness, and an intention

in fact, three years after the package comes into operation to have

a full inquiry into the adequacy of the compensation and that that

inquiry should be chaired by a person independent of government. We

also indicated, having regard to the concern that Senator Harradine

had expressed regarding

people who he claimed were outside the taxation system and therefore

not eligible for any of the compensation arrangements, that we would

establish a special arrangement in the nature of a relief scheme so

that people who claim to be dis-entitled could establish their disadvantage

and be compensated in accordance with the same compensation principles

applied to people who readily came within the compensation mechanisms

of the package.

It is our view that there are far fewer people in this category, particularly

people deserving of compensation than is the view of Senator Harradine

and others but we are nonetheless quite happy to accept the principle

and to provide a relief scheme in relation to those people.

Two other matters I should mention. In the discussion the Treasurer

alluded to a change in relation to the taxation treatment of credit

unions which the Government quite separately believed ought to be

provided for. That's a matter, of course, unrelated to the principle

matters under debate. And finally, I indicated to Senator Harradine

that the Government would accept in full the changes that he wanted

made in relation to the youth allowance and which were the subject

of some discussion earlier this week. Those changes will have effect

in the forthcoming financial year and, of course, are quite unrelated

and will be quite unrelated to the changes to the taxation package.

I indicated to Senator Harradine that that would be done. The fact

that Senator Harradine has indicated today that he is unwilling to

support the tax package in no way alters the commitment I made to

him yesterday.

I take the opportunity of putting on record that at no stage had I

previously given any undertaking to Senator Harradine about specific

changes in budgets in relation to the youth allowance. What I had

told Senator Harradine, and what I repeat today, is that in the discussions

we had last year I have told Senator Harradine that the Government

would take account of the costs of raising children when it framed

its taxation package. And that undertaking was given in the context

of seeking Senator Harradine's support for the common youth allowance

and the terms of that undertaking were put into the Senate Hansard

on my behalf by Senator Hill. So I just repeat again, at no stage

have I broken undertakings given to Senator Harradine. I reject that

completely. I did give him an undertaking yesterday in relation to

the common youth allowance and that will be honoured in full and I

told him this afternoon when we spoke on the phone that that undertaking

would be honoured in full.

I should also make it plain that what was put to Senator Harradine

yesterday were not private bribes to him. They were changes that the

Government had decided ought to be made and they will be made to the

legislation in the Senate before it is voted on within the next few

weeks. We intend to amend the legislation to give effect to what I

outlined to Senator Harradine yesterday. Our resolve to do that is

unaffected by the speech that Senator Harradine made in the Senate

this afternoon.

I should also say to you that the Government's commitment to taxation

reform remains undiminished. We fought and won an election with this

taxation plan fully disclosed, fully revealed to the Australian people.

We believe we had a mandate to implement it, we believe that if the

Senate votes the legislation down it will be disobeying the wishes

of the Australian people. I can't think of an example in my political

experience where a government has been more explicit, more upfront,

more detailed, more candid, more honest about what it intends to do.

We made full disclosure, we held nothing back. We have listened to

concerns expressed and although we do not believe they are properly

based we have been willing to make very generous and significant changes

which involve the cost of between $1 to $1.5 billion on an annual

basis and, of course, on a three or four year basis a much larger

amount. And given the other demands on the Government's surplus including

debt retirement it represented a very generous but balanced response

to the changes that were sought. It remains an even fairer package

with the amendments that we intend to make. We will put those amendments

and we will invite the Senate to vote on the package as amended. And

those who vote against it will be voting down an even more generous

compensation package.

So, ladies and gentlemen, I want to make it very clear that I have

not changed my commitment to tax reform. In the last 24 hours I have

argued in great detail and with great fervour about the value of tax

reform for Australia's economic future. Nothing has changed now as

a consequence of Senator Harradine's speech. If it was good 24 hours

ago for Australia it remains good today. I have always believed in

fundamental reform of Australia's taxation system and I intend to

continue to pursue it with all the vigour at my disposal.

JOURNALIST:

Does that mean taking it to the next Senate after June 30?

PRIME MINISTER:

Well, we'll put it up and obviously if it's knocked back we'll put

it up again.

JOURNALIST:

And does that mean a double dissolution....

PRIME MINISTER:

Oh, I am not going to start announcing election dates, we have only

just had one.

JOURNALIST:

But you are prepared to go to a.....

PRIME MINISTER:

Well, what I am prepared to do is do all that I can to get taxation

reform in Australia.

JOURNALIST:

Is there someone else you can try and woo apart from Senator Harradine?

PRIME MINISTER:

Well, we'll continue to talk to anybody who it seems reasonable that

we talk to. But I'll be talking to the Australian people a lot. And

I'll be saying to the Australian people: we had a seven week campaign

before October of last year. The Government that I lead spelt out

in total detail what I wanted to do. We won that election at some

cost but we won it and if a mandate means anything it means that we

have a right to have that package passed. And those who stand in the

way of that are, in my view, defying the wishes of the Australian

people. And I can't put it any more plainly than that. We need tax

reform. This Government was re-elected on tax reform, this Government

seeks parliamentary passage of tax reform and we'll continue to argue

for tax reform because you go into public life to do things that you

believe are good for the country. I believe taxation reform is good

for Australia and I'll continue to pursue it.

JOURNALIST:

[Inaudible] that does sound like double dissolution talk.

PRIME MINISTER:

Well, they're your words, they're not mine. I think you should reflect

on that fact. I'm simply saying to you that I don't intend

to give up the fight for tax reform. I intend to continue to pursue

it with all the vigour I have at my disposal.

JOURNALIST:

How much did the extra compensation that you offered to....

PRIME MINISTER:

Well that's what I mentioned. I said between $1 and $1 billion

a year.

JOURNALIST:

[Inaudible] billions that Mr Costello rejected on Wednesday.

PRIME MINISTER:

Well I wouldn't have thought 1 to 1 was billions, but you know.

More than one, less than two.

JOURNALIST:

[Inaudible] heavily involved in negotiations....

PRIME MINISTER:

Well the Prime Minister is heavily involved in everything.

JOURNALIST:

Did you get personally in negotiations with Senator Harradine?

PRIME MINISTER:

Of course I had.

JOURNALIST:

Do you regard this as a personal blow that he's rejected it?

PRIME MINISTER:

Well I don't regard it as a personal blow. I am disappointed

for Australia that the task for tax reform is made that much harder,

because the Australian public voted for this. I mean forget my personal

views. What really matters is good policy for Australia's future,

and I have believed in tax reform all the time I've been in Parliament.

I really believe in it. I think I have a responsibility as Prime Minister

to try and bring about change that I believe is good for this country,

even though it's hard, and even though I might be criticised.

But what is the point of holding a great office unless you use it

to the national benefit.

JOURNALIST:

Senator Harradine says that one of the major reasons he's rejected

the GST is that there's no guarantee that compensation won't

be diminished over time. Will you ever be able to convince him that

it won't?

PRIME MINISTER:

Well there's no guarantee of anything in this life, except death and taxes of some form as they say. I mean I can't....Senator Harradine can't guarantee that wholesale taxes won't go up under a future Labor government, the taxes on clothing  on't be increased under a future Labor government. He couldn't stop that in 1993.

JOURNALIST:

Are you prepared to offer Senator Harradine anything else to try and win his vote?

PRIME MINISTER:

Well look, I don't know what you mean by anything else. I mean he says quite properly that he doesn't cross trade, and I don't cross trade either. Other decisions that the Government has taken in other non-taxation matters that have been construed as wooing Senator Harradine, I think people have missed the point, that on a number of issues it does happen that my views, and the views of the Government and the views of Senator Harradine coincide.

JOURNALIST:

Well is there anything else you can....any way that you can...

PRIME MINISTER:

You should ask Senator Harradine that not me. I put a proposal to Senator Harradine yesterday along with the Treasurer. And that proposal he acknowledged represented a significant increase in compensation. I mean any of you who studied this will know that it meets the major objection raised by those who were critical of the compensation arrangements. Increasing the MTAWE figure from 25% to 26% is a huge....I think it's a quite significant, even huge change.

JOURNALIST:

So this package is now going to go the Senate.....

PRIME MINISTER:

It will go to the Senate with these changes in it that's the point.

JOURNALIST:

They are additional changes?

PRIME MINISTER:

Well, we certainly don't have any others in contemplation.

JOURNALIST:

Will you revisit exempting food?

PRIME MINISTER:

No. No, no, we are not going to exempt food. I have said that all

along and the more compensation you give pensioners the less is the

case for exempting food. And the whole purpose of compensation is

to protect low-income earners in relation to the cost of the essentials

of life. And if you give them more compensation then the case for

exempting food is diminished, it really is. So as of now the case

for exempting food is a lot less then what it was. The case for exempting

food is greatly diminished. It is much less now than what it was 24

hours ago.

JOURNALIST:

Without the GST going through before June 30, is that going to alter

any of your budget predictions?

PRIME MINISTER:

Well the budget is in relation to this coming financial year.

(ends)

11039