BYNER: Now Mr Rudd, you're very proud to tell us, and it's true that we have weathered the economic storm better than any other nation on earth. By there are some very significant challenges for you right now.
PM: Well that's true Leon and it's a challenge which we're responsible for because we're the elected Government of the country. We have just been through and are still in the middle of the worst global economic downturn since the Great Depression three quarters of a century ago. And what we've done here as Australia is act early, decisively, effectively, with interest rates being brought down rapidly by the Reserve Bank, a lot of fiscal policy work done by the Government through the Economic Stimulus Strategy, and the result? What we've done so far in this economy is produce one which has had the fastest growth off all the major advance economies of the world, the second lowest unemployment, the only one not to go into recession, with the lowest debt and the lowest deficit.
But you know something? The challenges out there in the global economy are still very real and it's a very uncertain track to global economic recovery.
BYNER: Prime Minister, let's look at some of these things in detail. First of all, the emissions trading scheme. Now both Nick Xenophon and the Opposition have asked, the Treasurer recently said there's a big, multi-billion dollar hole in the alternative proposal from Frontier Economics -
PM: Three billion.
BYNER: Yeah, ok. Now from the information that I've given to Nick Xenophon and back, he's told me as have the Opposition that your Government will not release the precise economic modelling with regards to your scheme. Because commentators are telling us and it's frightening to think that if your scheme goes through, we will be paying significantly more for everything we buy, no matter what it is.
PM: Well firstly on the question of transparency, you know something, I couldn't have come up with a more transparent process that the Government has engaged in with the Australian community for the last two years on our pre-election commitment to introduce a Carbon Pollution Reduction Scheme, an emissions trading scheme.
And what we have done is we've gone to green papers, white papers, formal modelling by the Treasury, we've gone to draft legislation, full legislation. Our full legislation has been out there since March of this year yet still, because Mr Turnbull and the Liberals are split right down the middle, they have no position to bring to the table.
And my challenge to them is as it's always been, is we will negotiate in good faith, but we want to see your amendments and it think that's a fair and reasonable question to ask. Amendments which are climate change credible - here we are in South Australia as part of a continent which the hottest and driest on planet, where the impacts of climate change will be felt first and hardest - so the amendments have to be climate change credible, they have to be financially responsible, and three billion dollars ain't financially responsible. But they also have to be prepared to bring this to a vote, not just filibuster, that is, hope that it will all go away because climate change isn't going away.
BYNER: OK, Prime Minister, we had David Chalk social researcher on here yesterday he's done a lot of polling on people's opinions and his research says two things. One, that they are prepared to pay no more than five dollars a week extra to general cost of living for a scheme that reduces our carbon emissions. But the commentators that have been out there and there are many, are saying it is going to cost us infinitely more than that. Can you guarantee that your scheme as it stands now will not cost more than five dollars a week?
PM: Can I say in response to what is a very widespread national fear campaign on this at the moment, two basic points - if we're going to introduce, if we're going to increase the cost of carbon in the economy - why, because we need to reduce greenhouse gas emissions, that's why and boost renewable energies like solar - it follows that energy prices and other prices will go up.
I have never tried to disguise that fact that's nonsense, that's being completely dishonest. Mr Howard said when he committed to bringing in an emissions trading scheme prior to the last election, that of course electricity prices and other prices would go up.
But in the modelling that we have produced, take electricity prices, the estimation that we have been provided is that electricity prices are likely to rise by about $1.50 a week in the first year of the scheme and $2.80 in the second year.
The other thing that I'd draw your listeners' attention to - and they should go online and look at all the detailed information contained in the Government's response to the impact on prices for consumers - low income earners, fully compensated. Proper compensation also to support middle income earners. We understand that there are cost adjustments here. That's why we have designed a scheme which does three things, increases the price of carbon, because you've got to bring down greenhouse gas emissions that what it's all about. Otherwise you get unsustainable increases in global temperatures including in Australia, more drought, more intense weather events, less water, less water flowing into the Murray - 50 per cent less over the last 10 years natural rainfall into the Murray Darling river system induced by climate change effects as well.
You've got to bring down those things but at the same time, adjust the cost burden for families and adjust the process of gearing up to different forms of energy consumption for industries as well. Our scheme does all those three things. There's a big adjustment program costing billions of dollars in there to assist families adjust with any cost increases and secondly, responsibly also to assist industries in their adjustment as well.
BYNER: So are you guaranteeing that it won't cost more than five bucks a week?
PM: Well, you know something I don't have a full range of modelling in front of me for this interview. Had you suggested we were going to talk about this in some detail I would have brought all the Treasury modelling in with me on each element of it.
BYNER: We did actually tell your people, but look -
PM: I'm sorry, that didn't, wasn't conveyed to me and I'm just saying that I. You know, I deal fairly and squarely with people when they ask me questions. The key thing to the debate is the cost of electricity. Therefore on the cost of electricity because it is coal fire electricity generation by and large, is the prices that I just referred to there, which go to $2.80 in the second year.
BYNER: When I spoke to Penny Wong last week, she was unable to guarantee that there would be enough electricity in Australia to avoid blackouts and load shedding because there wasn't enough investment in the industry. Can you give a guarantee to the Australian people now that with your scheme, there will not be an electricity shortage in this country?
PM: What we rely upon here Leon is again Leon the advice from the experts and the relevant regulatory authority in Australia has examined this very closely and have concluded that there is no basis for this type of concern. They've looked at all these, at the investments by the electricity suppliers. They've looked also at the fear campaigns being run by the electricity generators. If you are an electricity generator at the moment, and you are facing the introduction of a Carbon Pollution Reduction Scheme some of them may just try to get out there and try to arc up the fear campaign. You know, that's what's happening here.
BYNER: But you're going to compensate them.
PM: That's in part because we've said we will help industries adjust. That's why we've got a scheme called the supply adjustment scheme, that's why we've got a climate change adjustment fund, that's why have special provisions also for what's called energy intensive trade exposed industries and that's why we have compensation payments for families - because we need to adjust our way through to a low carbon economy because if you don't, guess what happens? We're going to have more drought, more intense drought, more intense weather events, huge economic costs down term.
And the cost of economic action now, is far less than the cost of economic inaction because we all pay for that and our kids and our grandkids will pay for it big time.
BYNER: Now Prime Minister, is one of the reasons you're here to do with an $800 million dollar road project from Regency Road to the Port? Can you tell us about this?
PM: The, one of the, we're also partners with the South Australian Government in road infrastructure development. One of the projects that we've been working on with the South Australian Government is the upgrade to what's known called South Road. That of course involves a substantial investment from us, about $500 million dollars, it also involved a substantial investment from the State Government which I understand is about $400 million dollars it's all part of relieving some of the traffic burdens and the freight burdens on Adelaide's road network.
It's together with the other big infrastructure investments we've made here, the desalination plant - $300 million dollars plus, investments in the Noarlunga to Seaford rail-line. Investments also in a whole range of other pieces of infrastructure as well, here in Adelaide.
BYNER: The other big issues that's been hot around Australia is the very large number of boats, overflowing, carrying asylum seekers into Australian waters. Some of the boats haven't reached here yet. Some are still in international waters. What are we going to do with our immigration policy where Christmas Island is brimming, we are told that we're shipping up huts to Darwin. Where are we going to go with this policy?
PM: Look lets first of all put it into context, we've had boats arriving here, every year for the last 20 years. Secondly, when Mr Howard was Prime Minister, put this all into context, nearly 250 boats came here carrying nearly 15,000 people and the Liberals talk about temporary protection visas, 90 per cent of those issued with temporary protection visas ended up staying in this country.
For the period I've been in office, for the past two years, we've had something like 30 odd vessels arrive and we have had something like 1,700 people -
BYNER: What's your -
PM: This is a continuing challenge for all governments but my challenge very simply is this, we have a clear cut policy for dealing with it, make no apologies for a tough approach to border protection, make no apologies for the retention of mandatory detention on Christmas Island, make no apologies for applying all these measures but we have a policy. The Liberals are split right down the middle and it's very easy to criticise but what's the alternative policy?
BYNER: What's your understanding of how many people are in the pipeline wanting to get into Australia, by these methods?
PM: Well, because we've got huge push factors working in the region for two reasons by the way, one is huge political instability in Afghanistan the second is this recent civil war in Sri Lanka. And it's not just us, its right across the world. Therefore, we're going to have a continuing challenge in monitoring illegal people movements right across South-East Asia, some coming here, some not coming here.
Things change they change rapidly. So we can't comment on individual events, but let me tell you our investment and our front line border security operations through the Navy, through Customs, through our intelligence officers, through our security officers, our police officers, right across the region. It is one of the most intense operations launched abroad by an Australian Government abroad, in peace time.
BYNER: Prime Minister we've talk about energy security, border security. I want to talk for a moment about food security and that is that our agricultural sector and our mining sector have been very responsible for the reason why we've avoided a technical recession.
The farmers are crying out, because they're at their wits end. There's a major issue where speculation in the water industry has forced the price up and it has frozen them out of the ability to actually grow things. What are we going to do to ensure that we are a viable food producer because for the first time recently, you would know this sir, that we are a net importer of food, we can't afford to go down that path. We have to be able to feed ourselves. Do you not agree?
PM: Well I grew up on a farm, I believe passionately in the future of Australian agriculture. My family are families of farmers, I actually understand a bit about this, though I myself have obviously grown up doing other things. Agriculture is a huge part of Australia's future but it is under stress for two reasons, one is water. And let me link that back to the set of questions you threw at me early on, and quite legitimately, about climate change and about the cost of adjusting.
If we don't act nationally and globally on climate change by bringing down global greenhouse gas emissions, one of the clear consequences is greater drought right across this vast and dry continent. And you can see that with the Murray Darling system, where we now have one half of the normal historical inflows into the Murray Darling System over the last ten years, than the historical norm.
BYNER: Will we compensate those farmers though, for increased input costs as a result of setting your scheme in place?
PM: We will work with agriculture through the Agriculture Minister Tony Burke as is appropriate in different circumstances. This is not simply, one even set of arrangements. Let me tell you there are adjustment arrangements also in place to deal with various fuel costs as well, for those who are obviously going to be affected by any impact on the cost of petrol.
But you know something, your questions about agriculture, the other big factor still affecting agriculture is the perversion in global trade. That's why we must, within the next twelve months bring the DOHA trade negotiations to a conclusion, to finally liberalise global trade in agriculture.
We have the best and most efficient agriculture producers in the world. We have a huge stress factor now which is called water and drought, which is climate change induced by and large. Therefore we have got to be acting in the long term on climate change, in the immediate term in taking the pressures off, for example, off the Murray Darling which we are seeking to do for the first time by seeking a basin wide cap in the history of this country, brought about by the Australian Government. And on the immediate term investing significantly in large buy-backs of water entitlements - some 660 gigalitres worth of water entitlements bought back from the Murray Darling system, the first in Australia's history.
BYNER: Prime Minister thank you very much for coming in this morning. Where do you go to from here? Everyone is saying 'why is he here'? We know you went to Murray Bridge yesterday and you talked about, the State wants you to fund hospitals, but you not run them. I don't know how you're going to wear that, I can see you smiling. But where do you go to from here?
PM: Well I am here in Adelaide today. I think I'm in Melbourne tonight but I was in Murray Bridge yesterday.
BYNER: Yeah.
PM: The hospital stuff is really important. When I was at Rural Doctors yesterday up there at Murray Bridge and they're a fine bunch of folk. But what they have to say, and I take my responsibility as Prime Minister for the whole country seriously, whether they vote for me or not, whether in rural areas or not, is making it possible for the best delivery of health services across the nation.
Our system right now is at tipping point nationwide the health and hospital system. It needs long term systemic reform. And you ask why I'm in Adelaide, I want to be at the coal face and talk to people who are running effective rural medicine services, as they were at Murray Bridge -
BYNER: (inaudible)
PM: - and sit down with them and hear from them first hand. I haven't had a particular pitch from Gawler yet. I'm sure it will be incoming. Do you know how many public hospitals there are in Australia?
BYNER: There's hundreds of them.
PM: 750.
BYNER: Yeah.
PM: In this consultation, myself and the Health Minister so far have spoken with 58 of them around the country. Not me, I've spoken to about 15. But you know, it's very important to hear straight from the horses' mouth about what's going right and wrong.
BYNER: Would you ever be prepared to pay for our hospitals but you not run them?
PM: You know something, that is a very important public policy question which you ask. The big debate right now is who funds the system long term. Because of the ageing population, the increasing population, the boost in pharmaceutical costs, wage costs. The cost of our health system is going through the roof.
The funding responsibility long term is what this reform process is about. There's a parallel question which you raise, how is it best delivered with maximum local flexibility. We're working our way through that. This is really hard stuff. We've said we'd come up with our final landing point on policy in the early part of next year and we will.
BYNER: Prime Minister, thank you for joining us this morning.
PM: Good to be in the studio.
BYNER: Prime Minister Kevin Rudd on 1395, Adelaide's 5AA. With a whole lot of questions one after the other. And he did enjoy a steak, an Angus steak at the Hilton last night?
PM: That's right, I got through various calls around the world on climate change late last night, trying to get a decent outcome in Copenhagen, if we can. But then, at 10pm last night they served me a very nice steak down in the restaurant at the bottom of the Hilton there.
BYNER: Good stuff. You look well and please, regards to your significant other , partner, Therese.
PM: The Adelaidian, she is back here often.
BYNER: Kevin Rudd, the Prime Minister.