McGUIRE: Thank you Prime Minister for joining us this morning.
PM: Good morning Eddie, thanks for having us on the program. It's grey and raining in Canberra. There you go, Melbourne outdoes us with the weather, for once.
McGUIRE: Melbourne's doing very well. Luke Darcy with a question for you, Prime Minister.
DARCY: Prime Minister, saw you at the footy on Saturday night, a very happy Brisbane Lions supporter, you had the scarf around, you were up and about out of your chair-
PM: Who are you backing this Friday, Luke?
DARCY: Well, of course, we're backing the Dogs. We've already spoken to your Deputy, Julia Gillard, who said there's a rift in the Labor Government. This is an exclusive. She's going to be at Friday night footy sitting there with her Bulldogs scarf on. Will we see you alongside of her, Friday night?
PM: Absolutely. It's not a rift, it's a fundamental split. I reckon it's irretrievable myself, when it comes to matters of deep belief like this. Yeah, so Julia and I will be there together, but I don't think I've told her that, could you just keep it quiet until I let her know. No one's listening to this at the moment, are they?
McGUIRE: I hope there are. I hope there's a few people, Prime Minister.
PM: And, here's the bet. We win - which I think it's a reasonable prospect, the Lions - and she gets to wear a Lions scarf in Parliament the following Monday. And in the unlikely event that the Doggies get across the line, I'll wear the tie, there you go.
McGUIRE: Alright there, well there we go, we'll see how that goes. Nice little bit of maroon with the red hair of the Deputy Prime Minister, and of course, the Western Bulldogs tie for the Prime Minister. Prime Minister, on more serious topics, not that there's anything more serious than the finals in Melbourne at this time of year, the economic stimulus is going to be debated long and hard in the next couple of days in Parliament.
Can you just tell us your take on where we are at the moment? We seem to be defying the world, a lot of things have conspired to give Australia a wonderful opportunity, and the stimulus package just looks to have worked beautifully.
PM: Well, the first challenge is this: we have faced as a world the biggest global economic downturn in three quarters of a century, since the Great Depression. For the first time this year, since the War, the global economy is actually going to shrink, not grow. So that is the challenge we face, quite apart from the implosion of financial markets we saw at the end of last year.
So, secondly, what do we do about it? Go and sit down on your hands and do nothing and just watch the wreckage unfold with unemployment going through the roof, or you could act. We chose to act through our national stimulus strategy, through which we funded our Nation Building for Recovery plan, and 70 percent of that is invested in infrastructure. And so what have we been trying to do? And that is invest in jobs, in small business, and in apprenticeships today, while investing in building in the infrastructure we need for tomorrow.
The results so far, we've had some success. Across the major advanced economies, we are the fastest-growing economy. We are the one with the second lowest unemployment, with the lowest debt, and the lowest deficit, and the only one not to have gone into recession so far. But let me tell you, there's a long way to go. And Wayne Swan, the Treasurer's been in a meeting of the G20 Finance Ministers this weekend in London, which brings together the 20 largest economies in the world, and they have all resolved that we're not out of this yet, and we've got to continue to implement not just our stimulus here, but around the rest of the world as well. It's still very uncertain out there.
McGUIRE: Prime Minister, small business, they're the ones that are gonna keep unemployment down by keeping people in jobs. We've had a wonderful situation with the stimulus going through, and people continuing to spend. There is a chance, of course, of interest rates going up, and of course that'll have the opposite effect as we head towards Christmas, but people keeping their jobs will keep people spending. Have you thought about cutting back on things like payroll tax or auxiliary taxes on businesses to try and give them an incentive to keep people in the jobs?
PM: Eddie, you're absolutely right about small business being key, and it employs such a huge number of Australians. One of the reasons we've been out there helping small business is to make it easier for them, a little easier for them under these difficult circumstances, to keep going. What we've done is brought in what's called a temporary investment allowance, and that started at the beginning of this year rolled through all of this year, beginning at 30 percent, rising to 50 percent, which means that if you're a small business out there wanting to invest in plant and equipment to expand your business in the future or to replace the stuff that you've got at the moment, then you get a huge, additional effective tax deduction.
On the future of tax treatment of small business and the general economy, we've got Ken Henry, the Secretary of the Treasury, working through all the options at present, and he should be in a position to deliver his report by year's end.
McGUIRE: So, Prime Minister, could we say that you're confident at the moment that the worst is behind us, as you said, with the caveat that the G20 aren't going as well as Australia. But with the uptake in mining and the other things going on at the moment, are you confident that we can look towards Christmas with maybe the worst behind us at the moment in Australia?
PM: Eddie, I'm confident that we've taken the measures that we can to reduce the impact of this thing, which is creating havoc around the world, and literally throwing millions of people out of work. But look, I've just got to be realistic with people. We are one member of a global economic community, we're doing better than most, but we are still affected hugely by what happens around the world. I've just got to say, we're not out of the woods yet. Some of the indicators are pointing in the right direction - business confidence, consumer confidence - but I've got to say, some parts of the economy are still very soft, so we've still got a long way to go, which is why we've got to not pull the rug from under the recovery by pulling the rug from under the investment in our national stimulus strategy.
McGUIRE: Prime Minister, thank you very much for joining us on day one of the Hot Breakfast on Triple M. We look forward to seeing you at the MCG. We know you're going to miss the Grand Final, you are unfortunately out of the country on - I don't know what's more important than the Grand Final, but doing something to save the world, I presume?
Well it's the G20 summit we've just been talking about, which is hosted by President Obama in the United States. I said to the President, 'look, have you heard of the AFL Grand Final. This is going to be a bit of a conflict." I had to explain to him for a little bit what the AFL Grand Final is, but I said 'Look, can you imagine having a summit on the day that you've got the Superbowl over there?' And he said 'Kevin, I'm not moving the date'. So there you go.
McGUIRE: Well, next time we might have to have it over here. That might the big thing, as part of half-time entertainment, the AFL looking always for something a bit different. Prime Minister, we really appreciate you taking some time out on a very busy week. Good luck with the G20 summit coming up in the next few weeks, we appreciate you being here on Triple M.
PM: And I presume, Luke, you'll be there on Friday night?
DARCY: I certainly will, and commiserations to your Brisbane Lions ahead of Friday night. No chance for them.
PM: Well, it's going to be an interesting evening. I'm looking forward to it.
McGUIRE: Good on you Prime Minister. Thanks very much.