O'BRIEN: The population debate was sparked by a speech from Treasury Secretary Ken Henry last October, in which he warned that the expected growth represented a host of implications for Australian society and profound issues for economic policy. The Prime Minister has further emphasised some of those challenges as a prelude to Monday's expected release of the latest intergenerational report, and Mr Rudd joins me now.
Kevin Rudd, if we can just start with that figure of 35 million; that's a projection based on current rates of immigration and childbirth. I get the sense from everything you said about this that you support not just a big Australia, but an Australia with that rate of population growth. Is that the case?
PM: Well, on the 36 million, that is simply a projection of what is happening now with fertility on the one hand, and the average of migration actually for the last 40 years- if you project ahead, that's where it lands you. So the responsible course of Government policy is how you prepare for that, given that there is a bipartisan view that those two arms of policy are a fact- or the two arms of reality, the fertility rate and what's happening with migration over 40 years, are constants. You asked specifically whether this is my target or not. I don't have a view on that to be honest, this is simply the reality we are now dealing with.
O'BRIEN: But when you talk about a big Australia, that's what you're meaning. You're comfortable about a big Australia within 40 years of around that number of 35, 36 million.
PM: Where we have the consensus in a bipartisan nature, is that's where the population is going; Mr Abbott even said so the other day, the question is, are we capable of preparing for it? And that means the ageing of the population, the infrastructure, but also as others have indicated in the piece that you just had on your program now, on questions of social cohesion as well. This is a challenge of national preparedness, but let's also put the other side of this question as well. We have the third largest coastline, we have the third largest maritime zone in the world, the third largest coastline in the world. We are currently a population of 21 million, we are the fourteenth largest economy in a century of massive change in the Asia Pacific region. We also need to be mindful of our long-term national security and long-term national economic security. So if we prepare these things well, and as a nation we've got the intelligence to do so, I do believe this also fits within our long-term interests to do so.
O'BRIEN: Since tonight's report focussed on social cohesion we might as well start there; Australia has had a number of racial and cultural trigger points in its history, what is the basis for your confidence that we will be able to maintain a mature debate in this country, on the future shape of our race and culture as we evolve beyond what is still predominantly an Anglo-European culture.
PM: I think anyone who's mindful of Australia's immigration history knows that there are always times in our history when some of these frictions bubble to the surface, and then they are dealt with, often within our uniquely Australian way, often around a barbecue. The early days of settlement, the English were very suspicious of the Irish. Your mob came here, the O'Briens.
O'BRIEN: I think the O'Briens came voluntarily, but go on.
PM: Unlike our mob, who didn't. But the English were suspicious of the Irish, you roll on a century, you come to the post-war migration boom. The Anglo- Celtic bloc were concerned about those coming from southern Europe, the Greeks and the Italians, that all sorted itself out within a generation. Come the '70s, and '80s, the European bloc, were concerned about the arrival of those from South-East Asia and more recently from East Asia and South Asia, that is sorting itself through and by and large has sorted itself through. You see, this has happened at various points of our history, and in all settlement countries around the world, the United States, the great melting pot, Canada, New Zealand. We have it within our wit and wisdom and historical experience to do this well, and I believe we'll continue to do so in the future.
O'BRIEN: You're a strong Christian- would it bother you if the influence of Christianity, for instance, were to fade significantly in Australia over the coming decades?
PM: That's just a question of how- well first of all, questions of religious belief are entirely personal matters, whether I'm strong on that I'll let others make that judgment. But really, the question of religious belief is simply one which reflects the evolving views of the existing population, and of those who come on our shores, but the- any view that you should entrench a particular, you know, religious view and the orthodox political arrangements of Australia I think is not in the Australian tradition. Remember, we have-
O'BRIEN: But fear, fear can be associated with that kind of question, can't it? It might be unreasonable fear, but nonetheless it can be real.
PM: But a hundred years or more ago the founding fathers had this great debate about the question of religion in Australian life, and in a much more profoundly Christian society in the 1890s, resolved there should be never any establishment of an orthodox religion in this country. And I think Australians have always had a pretty healthy view about this, which is, here we have our civic personality called Australia, over here we'll have a private religious beliefs, and we try and keep, shall I say, a healthy distance between them. One informing the other from time to time. And I think we can maintain that effective discipline and distance as a culture and a country in the future as well.
O'BRIEN: Social cohesion's not just about ethnic harmony is it, it's about fundamental social equity, about where and how people will be able to afford to live, how far from home they'll be working, how they're going to get there, access to education and health - in all of these areas you would have to acknowledge the system is already deeply imperfect. What will the demands of another 13 million people do to that?
PM: A lot is the answer. And let's not pretend that it's not a challenge; it is. That's why I have been speaking in the week to ten days leading up to Australia Day about the challenges of this growing population, and the opportunities it presents, but what it also means with wrestling with the ageing of the population, wrestling with therefore, the increased cost of health care, wrestling also with the increased need to invest in infrastructure, the need to invest in skills, the need to invest in the future of our cities. Here is the difference though - I said at the beginning of the interview there's been largely a bipartisan view on the role of immigration in Australia, and the future shape of our population size, as discussed earlier - where there's a difference is that we believe there is an absolutely central role for the Australian Government in the long-term planning of our nation's infrastructure needs, our water infrastructure needs, our transport infrastructure needs, the needs of our cities, and the proper planning of them. This is very much our view, and these are the policy directions we are taking. Our predecessors did not have that view.
O'BRIEN: Okay, well I'll come to some of those issues in a moment in greater detail. But big business has always heavily influenced the case for strong immigration levels.
Do you buy that lock, stock and barrel and in that context, of course, this figure of 35 million is artificial to the degree that it will always depend on what immigration levels the Government sets. We featured a developer named Harry Triguboff, who is one of Australia's, if not Australia's biggest, apartment builders/developers, it's pretty clear to see where he's coming from. He wants 100 million people in this country, the more people are here, the more apartments he's going to sell. So I mean, there's a very crude basis to that argument when it really boils down, isn't there?
PM: Well I'm sure he's speaking to his own book, well good luck to him. But no, I mean, the business lobby, if you want a better- I don't - I use your term- doesn't have any particular monopoly on wisdom on this question. I think, though, we've just got to be realists about the fact that our fertility rate is 1.9, the historic migration levels of the last 40 years are likely to continue into the future. There'll be some shaping and reshaping from year to year, depending on skills demands and the economies, but by and large that will be it. Therefore, the fundamental practical challenge is how do you prepare for this growth/ How do you prepare and plan infrastructure? How do you prepare and plan for the ageing of the population?
O'BRIEN: Well let's try and, let's come to a few specifics.
PM: These are the core specific challenges, and I think getting that right for the next decade, and for the next half century, will determine whether our nation has a proper future or not.
O'BRIEN: You, in your urban planning speech last October you said, quote: "We must prepare for freshwater supplies coming under increasing pressure"- well that's something of an understatement. I mean, how are you going to find enough water for a Brisbane that's more than double its current size, which is what it's going to be under your projections, that is already facing critical water problems now?
PM: Well, for the first time in the nation's history, the Australian Government, the national Government, is investing in urban water. Mr Costello when he was Treasurer said that's a matter for states. We don't have the view, you have actually got to make sure this works. So what are the means available to you? One, in Brisbane you point to the example of water recycling- we have a huge investment as an Australian Government, partnership with State Government in the Western Corridor recycling plant. It is very large in its operations. Also, we are investing at a domestic level in assisting people with acquiring rainwater tanks, dealing with the treatment of grey water, dealing also with stormwater run-off. Each of these things adds up as we are, for example, in Adelaide, co-investing with the South Australian Government in a desalination plant.
O'BRIEN: But South Australia are absolutely paranoid, and they would say rightly so, about the future of their water supplies, because of the extent to which the Murray-Darling system is still a mess in that regard, and that the States are not pulling together on this despite the work you, and John Howard before you, have put into it.
PM: Well I think there are two responses to that as far as South Australia is concerned. One is you're absolutely right in terms of the state of the Murray-Darling. We addressed a Community Cabinet on this subject in Adelaide just last week. And it's under enormous stress, has been for the last decade plus, where rain inflow into the system is about half of its historical levels, and in the last four years down to an even lower proportion as well. Hence why part of our national long-term planning must include national and global action on climate change. Leaving that to one side. On the Murray-Darling itself in the immediate, for the first time now we have a Murray-Darling Basin Authority; for the first time imposing a cap on the overall use of water in the system; for the first time the Commonwealth Minister sets the cap; for the first time therefore we'll have the proper regulation of environmental flows into the system. None of that happened before. We have done that in the last two years, and on the urban water needs of Adelaide, the investment we've made with Mike Rann's Government increases I seem to recall, by 50% the water generation which will come out of the desalination plant under construction there, and be a huge contributor to Adelaide's overall water security supplies. It's the set of these things which makes a difference, rather than just saying 'not my problem'.
O'BRIEN: Okay. Has the Treasury modelling, for all of this, calculated how much water is going to be available over the next 40 years- how much arable land is available? Are you going force the States to factor in every time they want to build another desalination plant how much that's going to add to greenhouse gas emissions? Have you factored the implication of this population growth on your determination to reduce greenhouse emissions by 5% by 2020, because demographer Bob Birrell, for one, has calculated that to do so each individual Australian would need to drop their carbon footprint by 28%.
PM: Well I haven't seen Mr Birrell's work, but can I say this - in terms of our forward projections on our greenhouse gas reduction targets in the range of 5, 15 and 25 which the Climate Change Minister spoke of yesterday, of course we factor in population growth into all of that, it would be irresponsible not to. On the specific measures, however, to be employed in dealing with each of these challenges it requires detailed planning work.
The Murray-Darling, to go back to this as your example, if we don't act globally on climate change, the projections are that by century's end there'll be a 90% reduction in the agricultural production of Murray-Darling Basin. What does that mean in practical terms? Act on climate change and in the meantime make the irrigation efficiency of the system vastly improved on what was, what it is, because we lose 30% of water from the inefficiencies of the irrigation system now. We're about building Australia's future. And to do that it is brick by brick, it's block by block, piece of infrastructure by piece of infrastructure to make a difference rather than sitting over there and moaning about the States not doing it.
O'BRIEN: Well, you yourself have quoted from President Eisenhower in one of your speeches related to this- 'the plan is nothing, the planning is everything'. No matter what leadership you might feel you can show at the top, it will always be the State Governments and Local Governments implementing the plan. Based on the past record, do you really have confidence that our system of Government will be able to deliver what it's often failed to deliver in the past, no matter how good things might look on paper?
PM: What it takes- you see, there's often big debates in this country about how you fix our sort of political and constitutional arrangements. There's a debate over there about constitutional reform, well that might sort out some things in the by and by - I'm concerned with the immediate challenges of how you make the federation work; whether it's on the future of the management of the Murray-Darling; whether it's on the future of the management of our health infrastructure, and hospital infrastructure; or the rest of our infrastructure. And the only script available to me is to use the leverage of the Commonwealth dollar in a spirit of cooperative federalism to try and yield results.
O'BRIEN: The jury is still well and truly out on how well you are going be able to do that ultimately.
PM: Well, we've been in office-
O'BRIEN: There's a lot of talk, but not yet much action.
PM: Well let me engage that. Two examples, again, the Murray-Darling, and secondly health and hospitals. Firstly on the Murray-Darling-
O'BRIEN: Well sorry, if you could do, we've covered Murray-Darling to a fair- what about health and hospitals?
PM: But in two years, after twelve years of running around in circles by the previous mob, we actually brought the Murray-Darling Basin Authority into existence. Secondly, for the first time next year, there'll be a basin-wide plan for the nature in the entire history of the Murray-Darling. Thirdly, the Commonwealth Minister will be setting a cap. Fourthly we've already purchased back 750 gigalitres worth of water entitlements for the system, and fourthly investing $3-4 billion in increasing the efficiency of the irrigation infrastructure. If you don't think that is a record of achievement, well, mate, you know, I bow to other levels of activity on health and-
O'BRIEN: What I'm putting to you is that what you're talking about is going to have to happen across such a broad scale of areas...
PM: Sure.
O'BRIEN: The capacity of any federal Government to be able to properly coordinate, coerce, and ultimately force the States to deliver the goods in all of these areas is a reach that is enormous, I would suggest to you, compared to the level of confidence and trust the Australian people have in State Governments. That's the last question.
PM: You know something- we haven't been delivered a perfect system of Government, but by two years of effort, with investment intelligently of the national dollar, and by collaborating with the states we achieved those 4-5 outcomes already on the Murray-Darling, a long way to go.
Health and hospitals, we now have a whole series of outcome-based agreements with the States and Territories on elective surgery, on post-acute care, on Emergency Departments in hospitals, again for the first time in the country's history, because we have chosen to make this work.
O'BRIEN: But Ken Henry, your own Treasury Secretary, has already said that you're going to have to find new ways to fund the massive infrastructure demands ahead. That what is happening now is simply not going to be enough.
PM: Well, we have an independent review of taxation which has just delivered its report. And how we fund this for the future is a critical challenge as well. Hence why we need to grow the economy through greater investment in productivity, infrastructure, skills, what I have been speaking about for the last week to ten days, that's the economic equation to generate the economic growth and tax revenue to invest in the infrastructure we need.
None of this is easy, but you know, there are two scripts for Australia's future. You can either play the blame game and say it's all the States' problem, and then do a bit round the edges and run to an election on some campaign of fear and smear, or you can actually say, no, we are elected to lead the nation, and we intend to make a difference with a plan cooperatively engaged by the States and Territories if we can, and then yielding the results over time. That's our script, and that's how we intend to govern.
O'BRIEN: Kevin Rudd, thanks for talking with us.
PM: Thank you.