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Brendan Nelson joins Insiders -

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Brendan Nelson joins Insiders

Broadcast: 18/05/2008

Reporter: Barrie Cassidy

Opposition Leader Brendan Nelson joins Insiders to speak about the Coalition's Budget reply.


BARRIE CASSIDY: Thursday night's Budget reply speech took on more significance than usual because
of Brendan Nelson's poor performance in the polls. Fair to say it was a feisty and a confident

The Leader of the Opposition joins us now from the Gold Coast.

(to Brendan Nelson) Brendan Nelson, good morning and welcome.


BARRIE CASSIDY: Were you pleased with your performance on Thursday night?

BRENDAN NELSON: I think importantly, it was able to point out to the Australian people that the
Labor Government has increased taxes, increased spending. It's targeted people it doesn't like,
including those people with private health insurance. And also I think it was important Barrie to
say to Australians, look, you have to ask yourself, is the Budget going to make it easier to feed,
clothe and house my kids, pay interest rates, put petrol in the car and buy groceries? And I think
they're the key issues. And as you know, I also have identified that we will stand and do stand for
lower taxes, including lower fuel excise.

BARRIE CASSIDY: What sort of feedback did you get from your colleagues? Has it taken the leadership
monkey off your back?

BRENDAN NELSON: I'm not going to talk about any of that sort of thing, Barrie. But I think
generally speaking, my colleagues, but more importantly, I think most Australians were quite
pleased to see that we've been able to frame what is increasingly the fraudulent media spin driven
nature of the new Government. Also, to make sure that Australians know that they're facing close to
$20 billion in more taxes over the next five years. And for every dollar cut from spending, after
all the rhetoric from Mr Swan, they are increasing spending by an extra two, and they are the
things that really count.

BARRIE CASSIDY: Well, it's a big call to oppose a Budget measure in the Senate but you're going to
do that with the tax on alcopops?

BRENDAN NELSON: Yeah, look, this is an alco-con. All of us were told as you know Barrie, through
one of the Sunday papers a few weeks ago that this would deal with so-called binge drinking amongst
young people. As a matter of principle I think most Australians at the time said, "Well, if that's
the problem and this will fix it, we'll give in principle support to it."

BARRIE CASSIDY: And you were one of them?

BRENDAN NELSON: Yeah, and I also said on the day, "But I want to see the evidence upon which the
decision is based." Well, we've seen the evidence. The evidence is that this $3 billion increased
tax on ready-to-drinks, which is not just those coloured fizzy drinks that are about one quarter of
the market, but also Bundy and bourbon mixes that are consumed by adult men, what we've discovered
is that binge drinking by young people, according to all of the studies we've seen, has actually
declined over the last six years. Further to that, the proportion of young women that are binge
drinking has declined. Also, the very study that Mr Rudd himself is so fond of quoting, the King
Study done by the Department of Health, actually found of those high risk drinkers - and keep in
mind there is a lower proportion of them - young women, they're actually consuming fewer of those
so-called alcopops than they were in the year 2000. So all in all, we consider this is an act of
deception. It's a tax increase that will take $3 billion out of the pockets of predominantly just
everyday Australians and for that reason, we will be opposing it. It's also, Barrie, it's not an
integrated approach to dealing with a problem such as alcohol abuse. And I have spent much of my
life fighting for these kind of things and what you must have is education, prevention, policing,
parenting, you use price signals as a part of it, but shifting kids in this case off, if you like
ready-to-drinks on to other forms of alcoholic beverages is not only sensible, I think it's

BARRIE CASSIDY: Well that's your argument, but Kevin Rudd's office has put out a list, a very long
list of health professionals who support the initiative, the Drugs Council, the Drugs Foundation,
public health associations, rehabilitation organisations, it just goes on and on, they all disagree
with your position.

BRENDAN NELSON: Well, Barrie, there are a couple of things there. Most, if not all of those same
groups are advocating a 300 per cent increase in beer and wine taxes. In other words, to see there
is an equal alcohol tax applied across the board. Most of those organisations were also led to
believe that the additional money raised would be spent on drug and alcohol treatment programs.
That's clearly not going to be the case. And I will be very happy to take up this debate in the
Parliament on behalf of Australian people. If Mr Rudd on the other hand had said, look, he can't
balance the Budget, he wants to increase taxes, at least he would've been more honest about it.

BARRIE CASSIDY: John Herron, who is former Coalition minister, now chairman of the National Council
on Drugs, he wrote a letter of congratulations to Kevin Rudd on Budget night.

BRENDAN NELSON: Barrie, John is a good friend. He is chairman of the Government's National Council
on Drugs. And if you increase the tax, in this case by 70 per cent, on one alcoholic product alone,
in the absence of other significant measures to deal with alcohol abuse, when the evidence in fact
is that the so-called target group has actually reduced its level of binge drinking, you will see
displacement of alcohol consumption, from in this case so called alcopops, on to other products.
For example, alcopops have 3 to 5 per cent alcohol in them. Wine-based products, which will be
much, much cheaper now, have at least 8 per cent, up to 22 per cent. So from our perspective, we
want to make sure that there is a fully-integrated, well-targeted approach to alcohol abuse, which
significantly involves in part by the way law enforcement, and this is nothing more than $3 billion
of an alco-con which is falsely misleading people into believing that this will deal with the
problem. It most certainly won't, and arguably, it will make it worse.

BARRIE CASSIDY: Just before we leave this issue of binge drinking, the Australian cricket team wore
beer caps in their first game in West Indies rather than the baggy green. What sort of message does
that send to a country that says it has a binge drinking problem?

BRENDAN NELSON: Well, I think at times we need to say that values are more important than value.
The baggy green cap is the iconic cap worn by our Australian cricket team, and whoever made the
decision for them to use another kind of hat, particularly one that promotes another product, in
this case alcohol, I think that's something that people should have a look at.

BARRIE CASSIDY: OK, we'll move on now to your petrol excise and you're proposing a cut of 5 cents a
litre. You're a big wrap for John Howard's economic credentials, yet this is something he always

BRENDAN NELSON: Well, John Howard and Peter Costello acted decisively in 2001 to stop fuel
indexation on excise. That takes close to 18 cents a litre off the price of petrol now, John Howard
and Peter Costello also argued strongly for lower taxes, that's what we believe in as Liberals. Six
out of the last eight budgets delivered income tax cuts. Wayne Swan delivered Peter Costello's last
income tax cuts on Tuesday night. Petrol is now around $1.50 a litre, Barrie. Watching petrol
prices will not bring them down and the one decisive thing that the Government can do is to
actually reduce the excise. So that's about 5.5 cents a litre off at the bowser, and at the moment,
as you know I've been on a listening tour. Your people sit on the couch on a Sunday morning and
talk about it, not always in a complimentary way. But what's the point of having a listening tour
if you're not actually hearing anything? This is the single most important pressing issue that's
burdening most Australians at the moment and that's why we've announced.

BARRIE CASSIDY: You've just punched a $2 billion hole in the Budget, though. How do you intend to
make up the lost revenue? You won't duck this, will you? You will come up with a list of savings?

BRENDAN NELSON: Well, Barrie, as is always the case with us as Liberals and Nationals, all of our
policies are and will be fully costed and budgeted. This is the policy that we will take to the
next federal election and as the RACV observed, there is now a clear policy differentiation between
the two major political parties. We believe in lower petrol prices for Australians and the Labor
Party believes in just basically watching it and not doing anything...

BARRIE CASSIDY: So et me be clear on this, then. You will come up with the savings; you will spell
out precisely where you will make up the difference?

BRENDAN NELSON: We will make it absolutely clear, Barrie, what our budgetary forecast is. We'll
make it absolutely clear where this $1.8 billion will be coming from that we will be putting back
into the pockets of the everyday Australians who are at breaking point when it comes to the price
of petrol.

BARRIE CASSIDY: Because you feel that's your obligation as an Opposition, to spell out where the
savings must come from?

BRENDAN NELSON: Well, unlike the Labor Party, you will recall just before the election last year
they had $10 billion worth of so-called promises that they did not submit to Treasury and Finance
for costing. Unlike them, all of our policies, all of our costings will be put up for analysis well
before the next federal election. Australia is, as a result of strong economic management over the
last 10.5 years, generally in a strong economic position, notwithstanding the fact that we have a
nervous Treasurer who appears not to know what he's doing, but we're determined to make sure we
continue to be party of lower taxes.

BARRIE CASSIDY: Now, on pensions, there seemed to be some confusion as to whether you're supporting
an increase in pensions or you're not?

BRENDAN NELSON: Well Barrie, we've done over the last 11.5 years, we improved the indexation model
for pensions. We brought in the lump sum payment for pensioners. We extended the telephone
allowance, utilities allowance and a variety of things. It is absolutely clear at the moment of two
things. The first is that it is approaching impossible for the men and women whose sacrifices made
the country what it is to live on the pension, base aged pension as it currently is. The second
thing that's obvious is that Mr Rudd in his apparent focus on working families not only ignores
pensioners and retirees and carers and many others in this community, but has delivered absolutely
nothing for them in the Budget. I'm very strongly of the view that it is time now for us to further
strengthen the financial position of Australian pensioners. And I will... we're in the process of
developing policy at the moment, and I can assure you that we will release that policy once it's
been fully concluded.

BARRIE CASSIDY: Would you do that by raising the base rate of the pension or in some other way?

BRENDAN NELSON: Well Barrie, I think it's too soon to look at that, but I think that there is a
very strong argument for raising the base rate of the pension, but again, we're closely following
this inquiry that's been conducted into it. But I do very strongly believe that pensioners deserve
a hell of a lot better than they've received from Mr Rudd and Mr Swan and I think, look, Kevin Rudd
found the time to go and visit Cate Blanchett's new baby. If he has got the time to do that, he has
got the time to meet pensioners and seniors organisations including those people protesting in
Melbourne and actually listen to what they have to say.

BARRIE CASSIDY: Now, the whole debate on welfare and what is welfare and what is not welfare, you
look at the decision the Government took on solar panels and the subsidy there, that's means tested
now at $100,000. Is that subsidy welfare or does it have a social purpose?

BRENDAN NELSON: Well, this is economic and environmental madness, Barrie. Firstly, by the way, we,
generally speaking as Liberals, we get a bit concerned about means tests in a number of areas. The
second thing is that, how do you means test an environmental footprint? People on higher incomes
generally have a larger carbon footprint than those who don't. The idea that if you're a policeman
and your wife's a teacher and you're ineligible for an $8,000 rebate to put solar panels on your
house, which are still going to cost you another $8,000 to $10,000 out of pocket, is in my view
absolute madness. It's also destructive of small business. This is a growing, an emerging industry
in Australia that needs more investment in research and development, and it's generally been higher
income people and when I say higher income, I mean $100,000 to $250,000 a year, the people that are
actually putting these things on. So this is something that I really urge Mr Rudd to have a look
at. I know Peter Garrett doesn't really know what he's doing when it comes to economics, but I
think Mr Rudd seriously needs to re-examine this measure. It is contrary to all of the rhetoric and
hot air we've had from him on the environment.

BARRIE CASSIDY: And just finally on the Medicare surcharge changes, this report this morning that
it might mean that perhaps a million people drop out of the system, what are you going to do about

BRENDAN NELSON: We will be opposing this measure, as I set out on Thursday night, Barrie. What
you've got is 485,000 taxpayers that are budgeted to leave private health insurance. I don't know
what world Wayne Swan's living in, but it's different from the rest of us. Each taxpayer carries
about 1.4 people in their private health insurance cover. So what the Government is doing is taking
close to a million people out of private health insurance, adding them to public hospital queues,
putting an inflationary impact on the premiums for families, pensioners and retirees that will be
left with their private health insurance because they think they're going to need it, and as I
suspected would be the case, this whole thing is driven firstly by the Labor Party's general
opposition to people having private health insurance or private education, they don't like people
that want to get on and look after themselves, but the second reason they're doing it is it saves
them money, because they will be paying less money in the private health insurance rebate of 30 per

So higher premiums, higher public hospital queues and unfortunately, considerably less money going
to Australian hospitals, and it's consistent with the confused, inconsistent way in which this
Government has approached its Budget. It's completely failed Australia, in my view.

BARRIE CASSIDY: Brendan Nelson, thanks for joining the program.

BRENDAN NELSON: Thanks, Barrie.