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This is PM AgendaWith David Speers It is 4 p.m. in Canberra, 1 o'clock in Perth. I am David Speers. Our top stories this afternoon, the Prime Minister weighs into the health funding row with Victoria, bypassing the state and redirecting millions straight to public hospitals.Telstra axes over 600 jobs from the Sensis telephone book business. And Qantas nearly triples its first half profit but still won't be paying a dividend to shareholders. Welcome to the program. Remember all that talk about ending the blame-game and reaching a national agreement between federal and state governments on health reform? This was signed by the Prime Minister and the state and territory leaders not that long ago.Now, we have an almighty row once again, and that agreement and the pledges to end the buck-passing look to be on shaky ground indeed.. Sydney we need to backtrack to explain what happened here. Some months ago the Q decided to claw back from the states health funding it had already committed because of population shift has were showing up in the official data. $107 million of that funding clawed back came from Victoria. Victoria wasn't too happy at all, it passed on that cut to the frontline services and before long we started to see elective surgery procedures cancelled, we saw staff, including doctors, being told to stay home. And threats that emergency departments would also be closed.This went on and on, became a real crisis for a lost patients in hospitals. Overnight the Commonwealth decided to act. It is restoring that $107 million to Victoria for this financial year, but it's restoring it straight to the hospitals, bypassing the Baillieu state government, delivering that money straight to the hospitals so that they can restore these services.Now the Prime Minister Julia Gillard made it very clear today that this won't effect the Federal budget bottom line because they will find other ways to take that money off Victoria. Look.Unfortunately premier bail year has decided in Victoria to -- Premier bail year has decided in Victoria to pursue a very -- Bailieu has decided to pursue a dishonest campaign in Victoria.While funding has gone up $900 million he is cutting by $616 million. Despite this he has tried to pretend to the Victorian people that an adjustment under one of the agreed formulas is somehow a cutback from the Federal government.The amount in question is $107 million.If premier Baillieu properly managed his hospitals he would be able to keep that money flowing to hospitals. Instead of properly managing his hospitals and keeping that money flowing, he's chosen to play politics with health care needs in Victoria.So I have decided that because of this in competence and politics from premier bawl you we will go around him -- Baillieu, we will go around him. We will send money to local hospital networks directly and send $107 million direct to hospital networks in Victoria. That money won't pass through premier Baillieu's hands it will go straight to local hospital networks.The Health Minister Tanya Plibersek drove home this point if other states want to go down the path pads and NSW and Queensland have said -- go down similar paths, Queensland and NSW, they too could find a similar outcome. The Commonwealth might decide to return straight to the hospitals but cut from the straights elsewhere.Instead of giving that money to the Government of Victoria we will give that money to hospital administrators to put directly into frontline services.This is money that the Victorian government would otherwise have been eligible for we are redirecting from their treasury, into frontline health services. If we have to do that in other stays we are open to it.Where does this leave the Federal state national health agreement and what does it mean the blame-game that was supposed to be over? It does appear to be worse than ever and it certainly looks like patients are being used as pawns in this particular battle. Did the government have grounds to make the cuts in the first place. It is points to statistics in the official reason why it made this cut and said it was part of the agreement with the states they look at the officials statistics and do it but they have to look at the cuts all in one year. If population bounces around year by year what does that therefore mean for hospitals that do have to make long term budget planning decisions? We will be discussing this coming up and we will be joined by the Victorian premier Ted Baillieu who is not too happy at all about how this has been handled by the Commonwealth and the tone of a letter that he received from Prime Minister Julia Gillard last night on this as well.We will hear from the premier shortly.Right here. In the meantime let's check in on what other news is making headlines this hour. Leigh Hatcher joins me of the news desk. Another bushfire this afternoon.Yes we are seeing on the screens, David, another emergency warning in place.For the grampians Victoria Valley complex. This large fast moving bushfire in the Glen Esla area travelling in a north-westerly direct, this fire is expected to impact Glenisla in the next few hours.The bushfire is approximately 25,000 hectares in size, and is out of control currently creating spot fires ahead. More details as they come to hand.Telstra's publishing an information business Sensis has announced it will axe 650 positions in Sydney and Melbourne, as the company struggles to make the transition from print to on-line.The union has condemned the decision, which was announced to staff this morning.Sky News Melbourne bureau chief Ahron Young has the details. Telstra says the changes were fundamentally effect the Sensis business, which has 21 offices around Australia, but most of the 648 job cuts will be made at the company's Melbourne and Sydney offices.In 2011 Telstra announced a program to turn around the struggling Sensis group but two weeks ago Telstra announced the first half earnings was down 69%, revenue dipped by 12%. Today Melbourne in Sydney staff were taken into meetings with management to be told their fate. The unions are furious and say the move is short-sighted. Sensis operating three brands including Yellow Pages, White Pages and trade trade but it is struggling to -- and Trading Post but it is struggling to make the move to publishing on-line.They say the cuts remove the duplication of senior and middle management roles and will outsource certain back office jobs to deliver around the clock support for Yellow Pages and White Pages customers.The company says 60% of customers are now advertising on-line but the shift from publishing to on-line is coming at a significant cost to the company, particularly to the 648 workers who will now be made unemployed.Qantas has revealed it's nearly trebled its profits with the airline's first half earnings released today.CEO Allan Joyce says the profitable result is due to his stuff decision-making, but acknowledges the airline still faces tough global challenges.There are still challenges ahead. We will continue to incur transformation costs, such as the $40 million to $50 million impact of moving the major of home from Singapore to Dubai. We can expect ongoing and vigorous challenges from the domestic and international competitors.And external environments remains complex and volatile, uncertainty and fuel prices and exchange rates.Aviation expert Jeffrey Thomas told 'news day' it justifies the new approach for the airline.This is vindication for the strategy, some elements of it people don't like but the reality this is the right strategy for the time and the place we are in at the moment.He's also dealing dealing with a lot of legacy decisions, bad decisions made 10, 15 years ago and he's washing that out of the airline.Results revealed improvement performance for its struggling international division while . There has been another asylum seeker tragedy at sea. 98 Australia-bound people have died, and their bodies thrown overboard after spending months at sea.The Sri Lankan navy released photographs of some of the 32 emaciated survivors, who ran out of food 21 days ago.The group which included one boy had been at sea for two months and told authorities of throwing the bodies of fellow passengers overboard after they died of dehydration and starvation. Immigration Minister Brendan O'Connor says it is another example of the awful consequences of getting on to dangerous boats. It is really now time for certainly the Opposition to have a rethink about the opposition to some of those recommendations because I just think we have got to take the politics out of this, focus on what we can do to prevent people dying at sea in this manner. He urged the Coalition to put aside politics and help the government implement all 22 recommendations made by the Houston expert panel.What I have noticed about Mr O'Connor is he's entered this revolving door the Labor's policy failure in immigration is this. It seems his job is to do nothing and just blame the Opposition all the way to the election. Scott Morrison says the Coalition will bolster its border protection policy between now and the election.A former NSW doctor jailed for removing a woman's genitals has had his sentence increased by at least another 18 months, after a successful Crown appeal.Graeme Reeves was jailed for a minimum two years in July 2011 after being found guilty of maliciously inflicting grievous bodily harm. Cameron Price was in court and he filed this report in Sydney.The doctor dubbed the Butcher of Bega has had his sentence increased by 18 months after appeal was handed down in the Supreme Court in Sydney today.Graeme Reeves was found guilty of indecent assault and maliciously causing grievous bodily harm with intent, when he was a gynaecologist on the NSW south coast in 2002. He was sentenced to two years jail but today's judgment means that 62-year-old won't be eligible for parole until December next year.But even with the extended sentence today's decision has left his victim still scarred by the mistreatment outraged.Carolyn De Wagene is one of them she had her genitals mutilated during a routine procedure in 2002 after going to the clinic to have a growth removed he took out her clitoris without telling here. It took her two years to alert authorities to the incident and today in court she cried as the decision was read out.I didn't have any expectations and I just will take the next step forward.Also in court Detective Sergeant Nigel Warren the officer in charge of the investigation who says the case isn't over.And that Mr Reeves is facing a number of other charge, including new victims that are yet to come before the courts.Those cases are expected to proceed now that the appeal has been handed down.This is far from over. Paralympics champion Oscar Pistorius is preparing for his third day of his bail hearing in Pretoria. He's accused of killing his girlfriend Reeva Steenkamp and has been charged with premeditated murder.Yesterday the case against Pistorius was badly undermined after the lead detective admitted to a series of Ms Takes and inconsistencies.-- mistakes and inconsistencies. He was forced to concede there was no evidence to contradict Oscar Pistorius's account of what had happened the night his girlfriend was shot dead. In sport, Sydney FC is celebrating after finally coming to terms with Italian football legend Alessandro del Piero to extend his stay at the A-League club. After months of talks the 38-year-old has opted to activate the final year of his contract worth $2 million a season.We took a lot of time with Tony and the club and everything is fixed and we have the choice all the day and this is the day that's why I really happy. I want to say thank you to the club.In 18 games for the Piero has scored 11 goals making him the club's highest scorer. The forecast:sh

I will be back soon.Look forward to it. Thank you. After the break we will be talking to Victorian premier Ted Baillieu about this hospital funding row with the Commonwealth. Stay with us.

You are watching PM Agenda. Welcome back to the program. As we have seen today, the health funding agreement between the Commonwealth and the states appears to be on shaky ground after an almighty dispute over a $107 million cut the Commonwealth made to Victorian hospitals towards the end of last year. This was because the Government said the official population statistics showed lower than expected population growth and that under the agreement this meant that money had to be clawed back from Victoria and other states.Victoria, not too impressed about that at all the, and believing the Government was simply craw claing back money to protect its own budget bottom line passed on those cuts to frontline services and it was patients in the end suffering so overnight the Queensland government has restored the $107 million but there is a catch. The money is going straight to the hospitals and instead the state government will lose money in other areas.Says Prime Minister Julia Gillard. So, what about the reaction from Ted Baillieu, the Victorian premier? I spoke spo to him earlier this afternoon. Thanks for youp time. Can we start where all of this began, the Commonwealth cutting $107 million from your state's health budget. Now, the Prime Minister...David can I just pull you up there and make a point at the start.It wasn't just $107 million in Victoria, the Commonwealth announced in November $1.6 billion of cuts to hospitals across Australia and that was in November of last year, and ever since they have sought to deny they did that.But it was very clear they did that and it applied across Australia and Victoria's share of that was $475 million, $107 million of which is in this financial year.The Prime Minister says this wasn't a decision of her Government, this was under the intergovernmental agreement on federal fix relations that you signed up to back -- federal financial relations that a signed up to in 2011.That is clearly a nonsense. We have heard at least a dozen different excuses for this cut. The Commonwealth announced these cuts in November and they based them on population figures which are completely and utterly flawed.The simple lesson there is that Wayne Swan used one set of figures for population growth in regard to local government funding and another set again in regard to hospital funding.And that's been widely discredit ed. These cuts have damaged hospitals, they have damaged fames and damaged parents and they should be reverse -- damaged families and damage the patients and they should be reversed. Are you saying every other state has a case for that funding to be reinstated.Queensland and NSW have already today indicated they want their funding restored and I think you will find Queensland have been arguing that as well as the cuts started to flow through into their hospitals. What has been announced overnight is a very short term political fix.Because of $1.6 billion in cuts announced in November, mid financial year they are only seeking to restore $107 million in Victoria and only in this financial year. And those cuts will resume again, having an impact impact in Victoria from July.You have as a state government though made cuts to the health budget over recent years? Because the Prime Minister says you have made cuts and more than $600 million and you are now using this dispute to mask that.Well this is one of the at least a dozen different excuses the Commonwealth have made. We increased our funding for hospitals in the health budget at the last budget. We increased funding to hospitals in Victoria by $360 million at the last budget. We have onnered our budget equipments, the Q -- honoured our budget commitments the Commonwealth haven't ownered theirs. They changed their in the middle of the financial year after hospitals having received the Federal and state budgets have announced their own budgets and you can't ask hospitals to operate on the basis of roller-coaster funding arrangements and that's what occurred here. They had a budget, the Commonwealth pulled money out they have had to adjust their budgets. Now they will throw monetary back in and they will have to adjust budgets again.That is hard on any hospital and it is hard on the doctors and also very hard on the patients obviously.So do you flat out deny cutting hospital funding at all?We have increased funding at the last two budgets for hospitals and health in Victoria and that is very clear in the budget papers and what the Commonwealth are running is just a distraction.Do you accept though that despite this cut that's now been reinstated the Commonwealth is still increasing overall funding to the Victorian health system, up to $4.5 billion in 2015?What I can tell you is that the state government made budget commitments last May, and then the Commonwealth budget made budget commitments in May. And from that the hospitals work out their budget. That's the way the system operates and the money goes into a pool. Come November in unilateral decision the Commonwealth then cut $1.6 bill abouton out of hospitals and that had an -- billion out of hospitals and it had an immediate impact and we have been arguing it was flawed information and totally unacceptable. We have prosecuted the case and in a short term political fix the Commonwealth are trying to throw back $107 million into Victorian homentd as lone.Not only that they will -- alone, not only that they will take away from other Victorian funding to pay for it.So give with one hand and take with the other and that's the problem with this Government, it is all seat of the pants, it's roller-coaster funding for important institutions like Victorian hospitals, and this applies across the country. Into we all remember when the premier's chief We all remember when the chief minister and premier signed the health care agreement with much fanfare. It was supposed to end the skabls like this over funding. Where does that now leave the national health care agreement?The Federal Health Minister today indicated this money won't even be returned to the pool funding arrangement s. They will pay hospitals directly which you can only expect they want to do that bus they want to turn up at the door of the hospital with a cheque, get photographs taken and try to recover some political ground. That's a nonsense.The agreement is there. And as I say, we honour the agreement, we honoured it in our budget, there was a federal budget, they changed their funding arrangements. The Victorian government has honoured its funding arrangements. Does it leave the whole national health care agreement looking like a bit of a farce?It certainly doesn't help and you will I am sure observe that other states are now saying we want the funding restored in our state hospitals as well. That makes sense.We have argued that case right from the start. It wasn't just Victoria versus the Commonwealth, this was the whole of Australia versus the Commonwealth. And in November last year all state Health Ministers, including the Labor Health Ministers, condemned these cuts.And we made it clear at the time what the impact would be, as did other states Health Ministers, including the Labor Health Ministers.This was a unilateral decision by the Commonwealth at the time, presumably when they were trying to prop up a surplus, and it was wrong then, it's wrong now. It's a short term political fix and the $1.6 billion should be restored to the funding arrangements in the future.The tone of the Prime Minister's letter to you, clearly pretty angry. Accusing you of being disingenuous and playing political games?It was - this was the most extraordinary letter I have seen from a prime minister. And included with it was a letter to other states threatening them. And I thought both letters were entirely unbecoming. They were full of errors and pedalling the range of excuses that have been made before.All of which are nonsense.This is a very clear issue. $1.6 billion cuts announced by the Commonwealth in November, they have since sought to deny it and all they are seeking to do now is restore $107 million in Victoria alone and take $107 million back from other funding in Victoria to pay for it.That in anyone's terms is a short term political fix.How would you characterise your relationship now with the President Obama?My relationship I don't -- with the Prime Minister?I don't get perm about these things and I have been suggest -- personal about these things. I have been subjected to personal abuse from Canberra but we don't get personal. We want to work constructively and deal rationally with issues and want to do whatever we can to provide certainty for hospitals and parents and that's what this is about.You can't ask hospitals to operate on a roller-coaster funding basis where suddenly there is more funding, less funding, more funding, less funding and that's what hospitals have had to do through this year. And it is just not fair.Do you reckon you would get a better deal under an Abbott Government whether it comes to hospital funding?Well I can tell you Tony Abbott's visited Victorian hospitals, he understands. He's been Health Minister and knows how the system should work.But, the bottom line is we don't have an election until September, and this $107 million will run out again in July.And the cuts will resume from July. So we need the funding restored now. We need it restored right across Australia.Is it time that Tony Abbott let you know what he's planning to do, because hospitals as you have acknowledged need to make budget plans decisions?Well, he wouldn't know - the election is not until September, we have to deal with the period up to September, at least, and these additional funds that were made available last night run out in July.So we need the full funding restored to provide hospitals with certainty.That's perfectly evident and that's what's necessary now.We would urge the Prime Minister to indicate that that's going to be the case. This $107 million is just a short term political fix, taking from Victorians to give at the same time. So you can't give and take at the same time. The funding should be restored.Premier Ted Baillieu thank you very much.Thanks David. Well, there you have heard the Victorian side of the story. We will discuss this a little further with our panel after the break. Coming up we will be talking to Lenore Taylor and Peter Harcher about this and some of the other politics of the day. Stay with us.

You are watching PM Agenda. Welcome back to the program. It's time for a check of the news headlines with Leigh Hatcher. As we have been seeing, there is much talk about this health disagreement between the Commonwealth and states.Yes and so there should be. The Prime Minister this afternoon has stepped into this ongoing health funding row with Victoria, and will redirect $107 million from the state and give it directly to public hospitals.But Victorian premier Ted Baillieu says his state's health system will still face a short fall on July 1.That will run out again in July and the can yous will resume from July. So -- the cut also resume from July. We need the funding restore ed now. We need it restored right across Australia.The Prime Minister has accused the Victorian premier of a grand act of incompetence in his handling of his state's hospital funding. An emergency warning is in place for the Grampians Victoria Valley complex. The large moving bushfire is travelling in a north westerly direction and is expected to impact Glenisla in the next few hours.It is approximately 25,000 hectares in size and is out of control, currently creating spot fires ahead. Telstra confirmed it will axe 648 jobs from its troubled Sensis division, which runs Yellow Pages, White Pages and the Trading Post.Business which employs $3500 people across Australia has struggled to -- 3,500 people across Australia has struggled to make the transition from print to on-line. It includes 391 positions which will be outstoursed for community and Public Sector Unions, says it is outrageous. A company as profitable as Telstra is sending jobs overseas.Qantas has nearly trebled its first half profit following decisions on loss making routes, aircraft retirement and maintenance changes.The article made a net profit of $111 million in the six nos to 31 December, up from -- in the six months to 31 December up from $2 million in the previous corresponding period. It falls below analysts expectations of a net profit of $138 million. The airline says again it won't be paying an interim dividend to shareholders. The Sri Lankan army has released photographs of survivors from a boat that spent two months at sea en route to Australia.98 asylum seekers from Myanmar died from dehydration and starvation during the trip. Their bodies were thrown overboard.The Government says it is time the Opposition supported the recommendations of an expert panel on asylum seekers to stop the deaths at sea.The Coalition says the Government needs to stop blaming the Opposition.Stunning developments in the Oscar Pistorius case with South African police confirming the investigating officer in the case is himself facing several charges of attempted murder.It comes as Pistorius arrived in court for the third day and is still waiting to hear if he will be granted bail following the killing of his girlfriend last week. Earlier the policeman in charge of the murder investigation was forced to concede there was no evidence to contradict the Paralympian's account of what happened the night his girlfriend was shot dead.In sport Sydney FV has resigned Italian football legend Alessandro del Piero for another A-League season. After months of talks the 38-year-old has opted to activate the final year of his contract worth $2 million a season.Tomorrow's forecast:

I will be activating that contract if it was me. Good one to have in the back pocket. Leigh Hatcher thank you for that.For more on this health funding row the national health disagreement it looks like now we are joined this afternoon by Lenore Taylor from the 'Sydney Morning Herald' in Canberra and in the Sydney city studio, Peter Harcher the political editor of the 'Sydney Morning Herald'. Lenore first to you the details of this state and federal health agreement are quite complex but this dispute revolves around a mechanism essentially that after the Commonwealth commits funding to the states they then get a set of figures from the bureaucrats that says population has grown by this much or that much and they can then claw back funding. That's what is being disputed now.Who is right and who is wrong in all of this do you think?Well it is difficult to tell. The whole thing was supposed to end the blame-game and that clearly hasn't worked very well. As you say the federal government last October took back a little bit of the big increase in health funding it had given the states as part of that health deal.Meanwhile a lot of the states have cut the funding as well. From the point of view of people administering hospitals or running the services it means they don't have the money that they thought they could bank on so what Julia Gillard has said today because the cutback, the pairing back if you like of the Federal funding, happened in the middle of a financial year and the hospitals were finding it hard to cope with that she's going to restore that but give it straight back to the hospitals and the local area health services, not send it through the state government, which she's having the big fight --,Of course the really weird this is that that starts to sound a bit like Tony Abbott's health policy. Let's fund the hospitals directly.It is not a bad response I suppose from the Commonwealth, but what strikes me as weird about the whole agreement is that you could have this element where if the population does bounce around year by year, which obviously it does, suddenly you could strip money out of the health Budget where hospitals have to make some long term funding decisions here. Are they really meant to be subjected to annual movements in the population figures that will therefore effect their budget? Shouldn't it be a longer term trend?It will seem logical for changes in population to be long term things which they can plan for and to do it mid financial year caused a whole lot of problems because the services are stretched and they have budgeted to the wire and suddenly they don't have the money they thought they were going to get.Clearly the Commonwealth didn't think the state would pass on the cut immediately. They thought they would soak it up and find it elsewhere.That's right that's why they are accusing the state government of incompetence and playing political games --It is a very complicated situation, the bottom line was closing emergency departments overnight for instance, which was what was going to happen at one Victorian hospital, was not a tenable situation and they had to step in and fix it.Peter, you know, whoever's to blame here, and getting into the nitty-gritty of the agreement is one thing but what is pretty plainly clear there is a problem with the agreement. If we have ended up in this situation? Well the first thing I would say first principles if you were going to design Australia's governance systems you wouldn't design them the way they are. You wouldn't design Australia like this. Another reminder of that.You would start again with the federation. The population numbers are one as I understand it, one of the three elements in the formula determines changes in funding year to year.And the population numbers do move around. Health - the rate of insurance in health costings, and improvement in technology are the two other elements in the formula.But the population numbers move around but that isn't the basis of the state's argument this time. The state's argue that the government has changed the methodology for calculating the position and that's the core of the problem -- the population and that's the core of problem. As I understand it this was going to come out today in a Senate enquiry, this methodology problem and the fact the Commonwealth has been playing games with switching methodologies.Which is why the government has got in before that was exposed? Exactly.So I think the Commonwealth was playing games. I think they have been caught.Well, there was an interesting contribution to this debate from Kevin Rudd today. He was on radio with Neil Mitchell on 3 AW in Melbourne and after exhaustive questions about the leadership they got on to health and it struck me he was far from being someone being - showing disunity. He was very much on board with the government's message on this, back ing Julia Gillard and Tanya Plibersek. Look what he to say.The formula by which these things are calculated. When Ted Baillieu signed this agreement with the Prime Minister Gillard in 2011 he described it as a fantastic deal for Victoria.Guess what else was in that agreement?The precise mathematical formula whereby fluctuations in the payments were going to be measured. That was hanging on three things.The Australian bureaucrats dasa, the second thing is the health inflation index calculated by the Australian Institute of Health and Welfare and thirdly the health technology index. He signed upper to for that. That's the formula and for him to suggest that the Australian bureau of statistics is dodgy figures is a direct accusation concerning the integrity of the Australian bureau of statistics.Putting aside the merits what he's arguing there because we have discussed there is is some dispute about the figures used the sight of Kevin Rudd coming to bat for full swing for the Government is something surely many of his colleagues would welcome you think? Yes. He dotsI -- he.... I'm imagining the... The reaction.I'm imagining the words that first e-America from their mouths when they turn on the merge from their mouth ever mouths and turn on the TV and radio and hear Kevin Rudd again.The fact he puts his head up really annoys colleagues, even when he's being a good go aof boy and doing the right thing what is he supposed to do. He is saying 25 to 30 colleagues have asked him to come to his seats and campaign. Is he supposed to have a silence, is he seen to be on strike and not supporting Labor? He can't win so I think he is probably doing what he wants and to hell with it. Lenore what do you make of this? We are a few days on from the shocker of a Nielsen poll for Labor, have things settled down at all in Labor ranks? We do seem to be seeing more of the Julia Gillard front bench lieutenants out there talking up her likelihood of stayingI think there is same people out talking up the likelihood of her staying in the same people are backgrounding about how it's dire and there needs to be a change and we are in the same position of not knowing whether that is going to happen or the mechanism by which it even could happen.I think it is the same situation that we had before. The Labor Party is terrified of the polls, they can see that things are going badly, there is a sort of stalemate in terms of whether the leadership is the right thing to do about it. And the whole iodine of those people supporting a change of how -- the whole idea of how those people supporting the change how get there is unclear.There is sniping going on back and forth. I saw summit quoted as saying Kevin Rudd should be a human shield for Julia Gillard or said he would be a assume of #450u78an Stephen Smith. There clearly is some sniping going on back and forth about all of this and a lot of focus on what Bill Shorten has been saying this week as well or not been saying. What do you make of where we are at towards the end of this week? Well, of course all of this is exactly electoral poison for Labor.The longer they are seem to be fighting, arguing and bickering and bitching about themselves the less they seem to be doing anything to help the public and that's poise yob.I think Rudd, the Labor Party has a very simple dilemma. They take the low risk choice and stick with Gillard but it's a low risk with a guaranteed outcome. And that is - or near guaranteed, as near as you can get to defeat or there is the high risk option of Kevin Rudd, which must increase the chances of electoral victory sim by ofply by virtue of -- simply by virtue of the fact he's a much more effective leader. He would add 10 percentage points to the Labor based vote but the mechanism and aftermath are high risk.I want to turn finally to the story that you had today, Lenore about the Greens pe saw the major break-up this week and now Christine Milne saying or then be to vote down the $1 billion savings measure that the Prime Minister wants to use to underpin her grand jobs plan she's been selling all week. This is a cut to R and D tax breaks for the biggest companies in Australia. Now, Christine Milne is saying she will vote against thattenless the government does something about fixing the mine -- unless the government does something about fixing the mining tax. Is she serious about this?She is deadly serious about it.The government has come out and said she is being hypercritical because what they are prop proposing to do is to take the tax breakaway from the big mining companies she is saying they are too close to.She says she is not opposed to research and development, she thinks that's not a bad thing but she definitely wants the mining tax loop hopes to be fixed.It's really all about political positioning.I think the Greens looked at the polls and could see there was a real danger they may not longer in a balance of power situation in the Senate. They needed to up their profile and needed to disassociate themselves from Labor which was probably going to happen around this point in the cycle anyway and they are doing it in a much more muscular way than people probably anticipated.Do you think there is any chance of the government actually doing what the Greens want on the mining tax? Increasing it, toughening it up, closing some of the loopholes? What do they do here?They said they will look at the loophole to do with state royalties. How they fix that Lord knows and they have been threatening to fix it for a long time but they have said quite categorically they won't change the design of the tax and that means the other thing that the Greens call a loophole, namely the very generous write downs the mining companies can make because of the way they are allowed to value assets the Government said very clearlithy won't change that.. -- clearly they won't change that.The likelihood of the Greens persuading the Government to chain the mining tax to their satisfaction is low, but the aim of the exercise is actually more to make the point that they are the ones that are arguing for it and to product differentiate. Are we going to see, because Peter there are still a few big ticket legislative items the government wants to get through before parliament rises and we go to the election.It is not necessarily going to be an easy run for them.The Greens are going to make it difficult. The Greens are now looking to pick a fight to differentiate themselves as Lenore was just saying. On this particular one the government faces - this dilemma about revising the mining tax to make it raise revenue. On the one hand they can be criticised by the Greens and look pathetic and incompetent with a new tax that raises barely any revenue, or they can revise the tax and face the danger of a renewed campaign by the mining lobby, potentially to increase revenue which they wouldn't get access to until after an election in any case. So faced with that dilemma they will disappointed Greens and accept looking pathetic and incompetent and face up to more arguments as you say in the Senate in the months to come.It is also if it plays out that way going to erode the budget bottom line only further. But I suppose what's another $1 billion on the deficit at this point?I think - we are in for a penny, in for a pound with the deficit.It certainly seems that way.Good to talk to you both. Thanks for joining us. We will be hearing from the Chief of the Defence Force general David Hurley. He's been in Afghanistan this week with the Defence Minister Stephen Smith and our very own David Lipson. He sits down with a chap with General Hurley about the situation on the ground there. Stay with us.

You are watching PM Agenda. Welcome back to the program. As you have probably seen here on Sky News this week, Defence Minister Stephen Smith has been in Afghanistan, one of the regular visits that he makes there as minister to visit the 1-- roughly 1500 troops we have in and around the that theatre of war. Most of them are centred in the main base of Tarin Kowt, in the Oruzgan province, no longer in the forward operating bases and hundreds of them will be returning home before the end of this year before an eventual withdrawal of Coalition forces by the end of next year. The handover though to local Afghan security control still has a number of hurdles to clear and this transition process is not an easy one.Not logistically in terms of bringing home so much equipment as well as personnel, and training up and making sure the Afghan security forces are ready to go, but also because of the threat - the heightened threat of high profile opportunistic attacks as they are called from the Taliban and others in Afghanistan.Trying to take advantage of the draw-down and make the point that the Afghan security forces are going to be weakened and that the Taliban may be able to exert more influence once the Coalition forces are gone. This sort of threat from opportunistic attack is something the minister has highlighted before, so what preparations are under way, what sort of extra precaution and security is in place? Well our Sky News political reporter David Lipson went to Afghanistan this week, with the Defence Minister, and the defence force chief General David Hurley. He spoke to General Hurley before leaving Afghanistan overnight.We have said every year say critical year in Afghanistan. But for different reasons. And this is a very important year this year because the Afghans are stepping up on the security side of the house, really starting to prove themselves in the field. So all the good work that's gone on here for the last number of years really comes to fruition this year. So making sure we just keep our focus on our advising role with them, be attentive to what's happening in their space, and just seeing the job through very important this year.The danger's not gone is it?No, it hasn't.Because the enemy has a vote in these things and so they understand from their reading of international media and so forth what's happening on the ISAF front and as we come out of wintser now and into the next -- winter now and into the next spring and fighting season we anticipate they will have a say in the progress.Can you give us any idea of the draw-down. Exactly how logistically it will work for the troops and for the hardware?So over the next year or so if you look at the - what we have got here in Afghanistan, we have got people facilities in Kabul, Tarin Kowt where we are nor and Kandahar. That's living facilities and buildings and so forth. Vehicles, equipment, everything you need to sustain an organisation, over 1,500-odd people on an annual basis.So you have got to collapse all that down but you have got to do it in a way where you maintain security, keep your mind focused still on the jop. Our job is not redeployment it the job is tos is the Afghan national security forces take on this year and move on successfully but underneath that we have to be extracting ourselves severals at the same time.We don't wa -- ourselves in the same time.We don't want to be in the position towards the end of 2014 all nations are trying to leave simultaneously.It is to keep an eye on the main job, the transition security from our perspective but carefully balancing the extraction of equipment.Where do you see our special forces focusing their efforts. After this year inThis year they will continue to do what they have done over the last number of years and provide that distance for us, in our operations support the AMSF when they are out on the field. And continue to create that secure environment for us.Then we will be looking as some key decisions have to be made now by ISAF in light of President Obama's indication of the US draw-down, how do we move from where we are today to the post 2014 construct.What will that look like.That very much depends on the discussions between the US, Afghanistan Government, and NATO. About the balance they want between the sort of sovereignty and some of the key -- the sovereignty and some of the key jobs that still have to be done. There is a key requirement to train and assist and provide some enablers into the ASF into the future. Whether there is a continuing CT role performed in Afghanistan or not is still a question to be answered.So the Australian Government has indicated we will continue beyond 2014, this year we will pick up responsibility with the British for running the Afghan National Army officer academy up near Kabul, so that's one job we will be doing. We will still have embedded staff in the headquarters this year in what comes post 2014. We will probably continue with logistics training for a bit further and then the question mark for us is what role will our special forces play. So that's still not answered but we will be worked out over the next few months or so.Thanks for your time.Thank you. General David Hurley chief of the defence force speaking in Afghanistan to our David Lipson. After the break we will get the latest news with Leigh Hatcher, including those job cuts at Telstra today. Stay with us. Live Captioning by Ai-Media ai-media.tv