Subjects: Minister Reith; GST; Economy; petrol prices.
E&OE……………………………………………………………………………………
MITCHELL:
Mr Howard, good morning.
PRIME MINISTER:
Hello Neil, how are you?
MITCHELL:
I’m well thank you. Mr Howard I suggest to you that the people of Australia believe Peter Reith should be sacked or the inquiry widened and that he should be stood down. Will continue to hold out against that?
PRIME MINISTER:
Neil, can I just bring back the facts. The first fact to make is that Peter Reith is paying the full $50,000 even though those calls were run up without his authority. He accepts that…..
MITCHELL:
It was his responsibility.
PRIME MINISTER:
Well he accepts that because he gave the details wrongly to his son in the first place, even though he did not authorise the card to be used in the way it was, he has to cop that. Now he’s paying that and can I say that again – he’s paying that. That seems to have been lost sight of. The second point I’d make is that after investigation the Director of Public Prosecutions has said that there is no basis for laying any criminal charges against Mr Reith, and on top of that the Solicitor General has said that he has no civil legal liability. Now in those circumstances for me to succumb to the media frenzy on this…..
MITCHELL:
I’d suggest it’s a public frenzy as well.
PRIME MINISTER:
Well I understand why the public is cranky but I do have an obligation in a situation like this to look to the merits of the issue and nothing has happened since last weekend apart from the fresh statement made by Ms Odgers which is being examined by the police, and in any event contradicts what Mr Reith’s son said, not what Mr Reith said. Now bear in mind that Mr Reith was not present in that house when either the details of the card were copied down or overheard, if you believe Mr Reith’s son, or given to Ms Odgers if you believe her version. Now you don’t know, I don’t know, I wasn’t there. The only thing I can do in circumstances like that is to accept the verdict of the people who’ve interviewed both of them. Now I haven’t interviewed both of them. I’ve interviewed Mr Reith and I’ve discussed this matter at length with Mr Reith and I’m satisfied of three things. I’m satisfied that he was in error in giving the card to his son way back in 1994. I’m satisfied that he knew nothing of the irregular use of the card until August/September of last year. And I’m satisfied that after he found out about the irregular use he did his best to get to the bottom of it and I can also repeat that he came to see me on the 8th of May this year and by the 10th of May of this year the matter was in the hands of the federal police, I having taken advice from the Attorney General.
MITCHELL:
Do you believe he’s been entirely honest through this?
PRIME MINISTER:
I have not discovered anything in this matter to suggest that Mr Reith has been less than forthright.
MITCHELL:
Well he talked about a hotel receptionist may have been responsible when he’d known for months about the involvement of Ingrid Odgers. That’s what he told us, it could have been a hotel receptionist when he knew about Ingrid Odgers.
PRIME MINISTER:
Well Neil, I haven’t been present at every single conversation he’s had with everybody but…..
MITCHELL:
That was reported Mr Howard.
PRIME MINISTER:
Yeah I know that, I know that was reported but he was like anybody else in a situation like that, I suppose he was speculating. But look….
MITCHELL:
But he knew about Ingrid Odgers at the time and he wasn’t telling us about that.
PRIME MINISTER:
Well yes, but he didn’t know the circumstances in which the card details got into her hands other than the versions given to him by other people.
MITCHELL:
Is there an issue here of ministerial standards and what you expect from ministers, and has that not been breached?
PRIME MINISTER:
Yes. Well the one clear thing that Mr Reith did wrong, the only one clear thing which he has done wrong in this in my view was to give the details to his son back in 1994.
MITCHELL:
He’s done something else wrong. He gave the details….I’ll tell you. He gave the details to his son. He knew that his son then ran up a bill, fair enough. He didn’t pay it until he got caught. Why didn’t he say I’ve given it to my son, I owe you a grand? He didn’t do it until he got caught.
PRIME MINISTER:
Well when I asked him about that his explanation is that he didn’t believe his son had used the card because it was given……
MITCHELL:
No hang on..
PRIME MINISTER:
I’m just telling you what he said to me.
MITCHELL:
He’s given his son the card and invited him to use it, we’ve paid for it. He knows we paid for it, even if it’s two calls. He hadn’t offered to reimburse the people until he got caught.
PRIME MINISTER:
Well can I put the other version to that? The other version to that, and I think the one that I think has been lost sight of, is that when Peter was informed that the card had been improperly used he initiated an investigation that resulted in the thing going to the police. And the police were investigating him and his son as well as other people and that investigation could have led to the laying of criminal charges against Mr Reith or his son.
MITCHELL:
Isn’t it true he only instigated that inquiry when he was told he could be liable to pay the whole $50,000?
PRIME MINISTER:
Well he instigated the inquiry Neil, as I understand, on the basis of what I’ve been told, he instigated that inquiry when he found out, or he instigated the investigation which led to that inquiry, when he found out that the card had been improperly used. I mean what people lose sight of is the fact that no matter what has been in any newspaper including this morning….
MITCHELL:
The Sydney Morning Herald today?
PRIME MINISTER:
Yeah, that Peter Reith himself was not informed by anybody, Telstra or by DOFA, of irregular use of that card until August/September of last year. Nor I am told was the Minister for Administrative Services – Special Minister of State Chris Ellison – he was not told until August/September.
MITCHELL:
But something’s gone wrong.
PRIME MINISTER:
No but okay. But if anybody has the right to perhaps be a little irritated, any individual has a right to be irritated about not having been told, if anything should have been told, until August or September last year it was Peter because the longer he was not told so the irregular use of the card continued. Isn’t that….
MITCHELL:
[inaudible]
PRIME MINISTER:
No, but you say OK you’re moving…..
MITCHELL:
I think there are many questions about Peter Reith and there are even broader questions like this Sydney Morning Herald material released today that says that Telstra fraud investigators told the Finance Department this rort was going on in July 1998, thirteen months before the investigations were started. They also showed that the department wanted the police called in in September last year well before Mr Reith called them in. Why?
PRIME MINISTER:
Well let me answer that. I have been told that in July of 1998 there was contact between a Telstra person and somebody in the department. And the decision was made by somebody in the department after investigating the matter that there was no basis for taking it any further, that there was a proper explanation for what appeared to be irregular use of the card.
MITCHELL:
And what was the explanation?
PRIME MINISTER:
The explanation apparently – a query was raised as to the use of the card in one part of the country as opposed to another, and on investigation, so I am told, it was found that Mr Reith in fact had visited the part of the country in which the card had been used so the use of the card was not irregular.
MITCHELL:
But even use of it in 1998. I thought he said he’d stopped using it well before that?
PRIME MINISTER:
Can I just finish the explanation? So I’m told that on the basis of that the DOFA employee decided that there was no point in taking it any further. But there was no reference made to Mr Reith. He was not informed of this inquiry by the Telstra employee, nor was the minister in the department. Now in those circumstances to blame Mr Reith for that is palpably unfair. You can say that there was something wrong with the system, you can say all of that, but Peter Reith was not told of the irregular use until August/September of last year.
MITCHELL:
Was he using the card at that time, has the department decided, or was somebody else using it?
PRIME MINISTER:
Well I can’t answer that question but I can…..
MITCHELL:
[inaudible]
PRIME MINISTER:
Well, and nothing has emerged Neil with respect, to disprove what Peter has said.
MITCHELL:
But I think what….
PRIME MINISTER:
No no, hang on. You see everybody’s running around saying Peter Reith hasn’t come clean. Peter Reith has had a consistent story and that is that when he was told about the improper use of the card he set about trying to get to the bottom of it and that was in August or September, August/September last year. And nothing has emerged to shake the truth of what he has said about when he first found out about this. And what you are referring to and what the Sydney Morning Herald is referring to does not shake in any way what Peter has said about August/September of last year.
MITCHELL:
But it does shake the issue of whether he was using the card which is a key issue. If the department accepted in July 1998 Mr Reith had been using the card legitimately at some place he was in the country. Mr Reith said he wasn’t, he hasn’t been using the card for years. Now that is a very key inconsistency.
PRIME MINISTER:
Well what the department concluded was that they apparently made some investigation about movements on the basis of some travel claims and they established that he was in one part of the country and that that indicated that he probably used the card. They didn’t actually ask him whether he used it.
MITCHELL:
Mr Howard, with respect we’ve got ‘probablies’, we’ve got ‘apparentlies’, we’ve got, ‘you are told’, and fair enough, you’re getting reports. Isn’t it time that all these probablies and apparentlies and you being tolds were put to a broader test in a full inquiry, Senate inquiry, judicial inquiry, whatever?
PRIME MINISTER:
Hang on, you’re suggesting therefore the Solicitor General of the Commonwealth who when he was appointed was probably one of the most highly regarded Queens Counsel in the country, is not as competent on these things as you and I, and journalists?
MITCHELL:
No no. I would suggest that a judicial inquiry or a Senate inquiry would be more appropriate because there are holes in the….report of the Solicitor General…the police have already gone back for further inquiries.
PRIME MINISTER:
Yes because further claims were made.
MITCHELL:
Well with respect that shows the police inquiries initially were insufficient.
PRIME MINISTER:
Not necessarily.
MITCHELL:
Well on the version of Ms X.
PRIME MINISTER:
Yeah, okay, well that’s right, well on the version, well what Ms X has said is in conflict with what Peter Reith’s son has said. It’s not in conflict with what Mr Reith has said. Mr Reith is the Minister. Mr Reith was not present at the house. He has no direct knowledge. He can only go on versions given to him by other people. Now you see you’re calling for a judicial inquiry. That’s what the Labor Party’s calling for. A Senate Inquiry, well you know that would just be a political witchhunt. I mean nobody with any serious commitment to finding out the truth of this matter would support a Senate inquiry. Look what is happening at the moment is you’ve had an investigation by the Solicitor General. He said no civil liability by Reith. Despite that Reith is paying the money. You’ve had a police inquiry and a DPP inquiry that says there’s no obligation, there’s no evidence to pursue criminal proceedings. Some discrepancies have emerged between the statement given by Ms Odgers to the police and a subsequent statement, and quite properly in the exercise of an independent responsibility the police are further investigating. Now as far as I’m concerned, if out of all of these investigations if anything substantially different emerges obviously I’ll respond to that. I mean as far as I’m concerned the police can investigate whoever they like. They can go back and question Mr Reith again, his son again, they can question anybody in the Department. I have nothing at all to hide on this. And I remain consistent with the position that was put when this first came to light.
MITCHELL:
Well if more information comes out, will you then consider a further inquiry – a judicial inquiry if necessary?
PRIME MINISTER:
Look I would only consider a different course of action if there were issues – substantially different material or issues – that emerge. But nothing has come out to shake what Mr Reith has essentially said all along. What he said all along is yes, he made a mistake giving the card to his son. He’s paid for that to the tune of all of this plus $50,000 and he’s paying every last cent of that.
MITCHELL:
Has he paid yet, the lot?
PRIME MINISTER:
He’s making arrangements to pay it. I mean can you write a cheque immediately for $50,000. I can’t. I’d have to make some arrangements. Fair go, he is clearly going to pay the money. Can I just say, that is an example of how ridiculous this whole thing has become. Is anybody seriously suggesting he, having said he’s paying the money, that he’s not paying.
MITCHELL:
Nobody is.
PRIME MINISTER:
Ok.
MITCHELL:
Can I ask you further. Let’s get to the principle. The Financial Review reports a case today in the Industrial Commission. A Telstra sales executive runs up a bill of $10,000 on his business credit card – personal costs. He says he didn’t know it was against policy, repays the money. He’s sacked. The Industrial Relations Commission when he goes to it says it was right that he was sacked. Is there a difference there?
PRIME MINISTER:
I’ll tell you, there is a difference there. He got the benefit of the expenditure on the card.
MITCHELL:
Well, indirectly, so did Peter Reith?
PRIME MINISTER:
No, how has he got it?
MITCHELL:
Because he gave it to his son. That’s the whole thing. If he hadn’t given it to his son it wouldn’t have happened.
PRIME MINISTER:
Yes, but the $50,000 of calls were not made by Mr Reith or by his son.
MITCHELL:
Is Peter Reith’s political future severely compromised?
PRIME MINISTER:
Look, Neil, never write anybody off in this game.
MITCHELL:
Yes, but he has been seen as a successor to you, hasn’t he?
PRIME MINISTER:
The question of who succeeds me, when I ultimately decide to give it away, is a matter for the Liberal Party.
MITCHELL:
Yes, but there has been Liberal Party polling done on the differences between Peter Costello and Peter Reith and Peter Reith comes out, before this, was stronger wasn’t he?
PRIME MINISTER:
Well, you say Liberal Party polling. I’ve got to say, I haven’t seen it.
MITCHELL:
I’ll see if I can get you a copy.
PRIME MINISTER:
See if you can get me a copy of that will you. I have not seen that particular polling and look, I’m not sort of interested in successors. I’m enjoying the job.
MITCHELL:
We’ve still got $36,000 or thereabouts unaccounted for haven’t we? Isn’t that reason for further inquiry?
PRIME MINISTER:
$36,000?
MITCHELL:
Yes, Paul Reith’s paid $1000 – has run up $1000 rather. “Mr Y” has run up $13000. Let’s say “Miss X” a couple of thousand dollars, there’s $36,000.
PRIME MINISTER:
But from a crude public interest point of view, Peter Reith’s paying the whole lot.
MITCHELL:
Yeh, but from a principle point of view we still don’t know how that $34,000, $35,000, $36,000 went.
PRIME MINISTER:
Look Neil, that is not something that the Government can establish other than through the police and the law authorities and that is exactly what we are doing. I can’t carry out an investigation. I can’t go and personally interview Miss Odgers and Paul Reith.
MITCHELL:
I’m not suggesting you do Prime Minister.
PRIME MINISTER:
And neither, can I suggest, can journalists competently do it either. The people who should do this are the police. Now the police have been asked to do it. Some more comments have been made and the police of their own initiative in exercising their independent authority, are talking to her again. I don’t mind what comes out of that. If they come back and say something completely different from what they’ve previously said we’ll I’ll have a look at that and I’ll respond to that in an appropriate way.
MITCHELL:
You’re still open to an inquiry in that case?
PRIME MINISTER:
Well all I can do is to react to the circumstances and the material that is in front of me. And as I speak to you, on the morning of the 20th October at ten minutes to nine, the situation is that: Peter Reith is paying the money; the police and the Director of Public Prosecutions have said there’s no basis for having a criminal prosecution; the Solicitor-General has said there’s no civil legal liability; nothing has shaken Peter Reith’s assertion, nothing, that the first he knew of this was late August/early September and then he set about trying to get to the bottom of it; and, as soon as the matter came to my attention it was sent packing to the coppers. Now nothing has shaken any of that. I can read 20 front pages and I can hear 20 exhortation from different people to do this and do that. My responsibility is to act according to the facts and the merits.
MITCHELL:
Well let’s hear a little from the public. Phylis, go ahead please. What do you think?
CALLER:
Mr Howard, does this mean that any politician now that’s given a card can just hand it to anyone?
PRIME MINISTER:
No, it does not mean that. It means that if you do that you pay a very heavy price. Namely you pick up the bill for any unauthorised use of the card and that is exactly what Mr Reith is doing.
MITCHELL:
But will it be a hanging offence if it happens in the future?
PRIME MINISTER:
Well, you’d look at each situation on the circumstances surrounding it Neil.
MITCHELL:
Are there any more suspected?
PRIME MINISTER:
Other people doing this?
MITCHELL:
Yes.
PRIME MINISTER:
Well I’m not aware of it.
MITCHELL:
Have they been investigated? Have the cards been checked?
PRIME MINISTER:
In two or three weeks the details of the telecard use of every member of Parliament is going to be made public. Just for the record it’s zero on my card in the whole time I’ve been Prime Minister. These telecards aren’t used much now because people have mobile phones.
MITCHELL:
You’re not aware of any other problems?
PRIME MINISTER:
I’m not aware of it but I mean, Neil, I can’t answer that.
MITCHELL:
It could be the Opposition?
PRIME MINISTER:
Well, I don’t know. You go and ask Mr Beazley. He’ll probably give you the same answer. He’d say he’s not aware of it and that’s all, quite honestly, that’s the only answer anybody in our position can give.
MITCHELL:
Hello Freddy. Go ahead please Freddy. Freddy are you there? No. Ray, go ahead please.
CALLER:
Look I feel the jury’s still out on Peter Reith but as a concerned citizen, my main concern is what appears to be the massive incompetence of the administration of these cards, both from maybe Telecom or whoever it is and also maybe Peter Reith’s department. If something like this can go on for four or five years, you know, where the hell is the control over the administration?
PRIME MINISTER:
Well I don’t want to, because the matter is still being debated, I don’t want to make final judgements about that but I can only repeat that the first Mr Reith knew of the irregular use of the card was August/September of last year. I repeat, August/September of last year and as soon as he heard of the irregular use of the card he set about doing something about it. Nothing has happened to shake that assertion.
MITCHELL:
Ok, given, just to get back to the Sydney Morning Herald point. 1998 the Finance Department was aware of it. Does the Minister carry responsibility for that?
PRIME MINISTER:
Well I’m obviously going to get further information about that but I was told this morning exactly what occurred and I tried to explain it to you a few minutes ago. If you’re not told something, this is an ordinary common sense test, it’s a bit hard….
MITCHELL:
But it’s not a very good defence for a Minister – ignorance – is it?
PRIME MINISTER:
I’m sorry, that is just not correct. You don’t take responsibility for every remote error that is made. On that basis, every time the tax office makes a mistake the Treasurer gets the blame, every time somebody in the Army makes a mistake, the Defence Minister takes the responsibility. There’s got to be some personal involvement or some dishonesty on the part of the minister or some neglect or sloppiness by the minister personally or in his office. Now, if information doesn’t even get to the Minister’s office, can I say this very firmly, if information doesn’t even get to the Minister’s office, it’s a bit unreasonable to say the Minister is to blame.
MITCHELL:
We need to take a very quick break here. I’ll come back to wrap up with the Prime Minister.
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MITCHELL:
Mr Howard, if I may, another couple of issues just quickly. Do you think it’s fair that people going to the football pay a GST on tickets, people going to the opera do not pay a GST on tickets?
PRIME MINISTER:
Well they only don’t pay the GST on the tickets if those tickets are provided on a non-commercial basis.
MITCHELL:
But that, I’m told, is most of the major opera, ballet and symphony orchestras in the country.
PRIME MINISTER:
Well it can apply to those but one of the reasons for this is that those bodies, along with many other bodies, are bodies that have what’s called a deductible gift recipient status. In other words, you can make tax deductible gifts to those organisations.
MITCHELL:
But is it fair?
PRIME MINISTER:
Well.
MITCHELL:
I mean if the average bloke going to the footy is paying GST arguably the toffier lot going to the opera are not paying GST.
PRIME MINISTER:
Well in some cases they will, in some cases they won’t. The problem of separating something like the opera from the museum – they both have the same gift deductible status. If you apply the rule that you are implying ought to be applied to the opera, you’re going to have to do the same with the museum and you’re going to have GST charged on entries to museums.
MITCHELL:
But I’m just looking at is it fair?
PRIME MINISTER:
Well this is a ruling being made by the Tax Office and I mean obviously I’m going to have a look at the application of it but my first reaction is to say that it’s pretty hard to disaggregate opera from museum and I repeat, it only applies where the tickets are provided on a non-commercial basis. Whereas in the case of a football match, they’re not provided on a non-commercial basis and there is no gift deductible status applying to the people who run the football match or the cricket match for that matter.
MITCHELL:
The dollar, Mr Howard?
PRIME MINISTER:
I’m not even going to comment on it indirectly.
MITCHELL:
What about the economy beginning next year?
PRIME MINISTER:
The economy’s running very well. We have the lowest unemployment for ten years. We have a strong Budget surplus although you can never be certain about the precise size of that but it’s still quite strong. We have lower inflation. We have a very interesting report coming out from the ACCC later today which deals with the subject of petrol prices. It will be very interesting to see what the report has to say in relation to the impact of the new tax system.
MITCHELL:
You’ve got an idea obviously.
PRIME MINISTER:
It will be very interesting to see what it’s got to say.
MITCHELL:
Ah, you’ve got a leak on it.
PRIME MINISTER:
There’s no leak on it. I’m just drawing your attention and that of your listeners to the fact that there’s a report coming out.
MITCHELL:
Do you think it won’t be critical of the Government?
PRIME MINISTER:
Our position has always been that the reason petrol’s a very high, painfully high price now is the world price of oil and I don’t think anything in this report is likely to shake that.
MITCHELL:
Thank you very much. Are you going to survive this week – the Government?
PRIME MINISTER:
Neil, it’s been a difficult week but I look to the merits of it and I don’t believe the grounds exist for Mr Reith to leave the Government and I’m sticking by him.
MITCHELL:
Thank you very much, Prime Minister John Howard.
[Ends]