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Tony Abbott red are ready for

battle with his new look

frontbench. Pressure deprous on

the Pope over his handling of

sex abuse cases. Sidid sid's -

Sidney Nolan's Marksman hits a

record price and Carlton

thrashes Richmond in the AFL

season opener. Good morning.

It's Friday 26 March. I'm Joe O'Brien. And I'm Virginia

Trioli. The top story on ABC

News Breakfast - the Opposition

Leader Tony Abbott is talking

up his new economic team after dumping Barnaby Joyce from the

finance petrol. Andrew Robb has

Finance Minister while Senator now taken over as shadow

Joyce is now the spokesman for regional development,

infrastructure and water. The

Federal Government says Mr

Abbott lacks economic credible

for not Dutching Senator Joyce

sooner. The Finance Minister

Lindsay Tanner says he's now on

to his fifth shadow Finance

Minister in just over two

years. The former Federal

Treasurer Peter Costello says

snien's resignation from the

frontbench is a loss but the

Coalition is now back in the

political game. I always found

Nick a very generous man, a man

of great character. He'll be

missed. But the circus moves

on, and if Andrew Robb comes

back and performs in that role

I think he'll do well and as I

said earlier, you know, Tony

Abbott has put the Coalition

back in the game. This is going

to be a real contest and I

congratulate him for doing that

and I look forward to the

contest. Because I think

there's a lot of opportunity, a

lot of opportunity, for better

Government in this country. Former Federal

Treasurer Peter Costello

speaking at a dinner overnight

in Melbourne. For more Dana

Robertson joins us now from

Canberra. Good morning. You're

going to have to help me here.

I'm sure I remember Peter

Costello just the other day

beating up Tony Abbott for

having one of the worst

policies going around and now

he's saying that he's put the

Coalition back in the game? Well it certainly is a

huge turn around as you say.

Tony Abbott's six most paid

parental leave scheme got lambasted by the former

Treasurer. He was talking about

the economic ruination of the

country because of that policy

which he thought was just

appalling. Perhaps his real

problem was Barnaby Joyce

because now that he's gone

Peter Costello seems much more

happy about Tony Abbott and his

leadership and his election

prospects later in the year. Although, it doesn't

necessarily bode well for the

Barnaby Joyce himself way the Coalition's travelling.

yesterday, last night alluded

to the fact that there were

some underminers within the

Coalition who wanted him remove

from the finance portfolio and

the Liberal Senator Ian

McDonald yesterday wasn't particularly complimentary so

perhaps all isn't necessarily

well on the good ship Coalition

but Barnaby Joyce's removal

from the finance portfolio

perhaps will certainly remove a

line of attack that the

Government's been really honing

in on and also I think it does

put Barnaby Joyce undoubtedly

back where he's best, I think

if you saw him out in the bush

Emissions Trading Scheme particularly during the

debate, the way he relates to

ordinary people, suring occupy those National Party votes in

the country, that really is

where he belongs out on the

retail coal face of politics

and so even though he says it's

not a demo, he says if you're a

Hu millation to the party you

don't get given three other

portfolios, it is a demotion

but it reks where Barnaby

Joyce's talents lie and as Tony

Abbott says they're perhaps not

behind a desk. Is that it now

then. Do we have a rock solid Opposition frontbench in this

election year? Well, certainly

I think until the election we

do, but once the Emissions

Trading Scheme is voted on

perhaps it could change just a

little. Malcolm Turnbull reportedly contacted Tony

Abbott yesterday and

volunteered to serve in the

finance portfolio. Tony Abbott

wasn't quite willing to go that

Emissions Trading Scheme is far yet particularly because

still on the the parliamentary

agenda and Mr Turnbull is

likely to again cross the floor

but perhaps once that's over

this shows that the two men

could bury the hatchet to a

degree. Mr Turnbull as shown

he's willing to serve under

Tony Abbott. Tony Abbott says

he'd be happy to have Malcolm

Turnbull back in a senior role

for example if he won the

election. I think it's also a sign that perhaps Malcolm

Turnbull's real grudge was with

Nick Minchin who orchestrated

his zoun fall over Emissions

Trading Scheme. Not necessarily

with Tony Abbott. Perhaps he

could recognise in Tony Abbott

a man willing to seize his

opportunities when they come

along, so there is still I

think a prospect of Malcolm

Turnbull making some rt sort of

political comeback and I'd say

a much less likely prospect of

him either not contesting the

next election or resigning soon

after Today in Canberra the

Federal Treasurer meets the

State Treasurers? Yes, Wayne

Swan stepping in to do some of

Kevin Rudd's work here I think.

He'll be trying to convince the

State Treasurers to come on board with the Federal

Government's hospital funding

plan. Of course, the big

stumbling block here is always

going to be taking back 30% of

the State's GST to pay a

greater share of public

hospital funding. Western

Australia in particular is not

happy about giving up that

revenue. There's always this

sort of fight with the States

particularly big mining States

like Western Australia who

claim that they're giving much

more into Federal coffers than

they're ever getting back. Wayne Swan will certainly have

a bit of a PR job on his hands

I think to try and convince the

State Treasurers that this will

be a better financial move for

them and try and threat gem a

little more on-side before the

sprems their COAG meeting in

about a month. In other new this morning, France and

Germany have proposed a $23

billion Euro rescues package

for Greece. EU leaders are

expected to discuss the Greek

debt crisis in brusz else

today. German chancellor Angela

Merkel says any aid must

involve the IMF. The European

central bank chief Jean-Claude

Trichet has spoken out against

the plan. The verdict in the

trial of Australian mining

executive Stern Hu will be

delivered in Shanghai on

Monday. The case was closed to

the media but Mr Hu and three

of his Chinese colleagues from

Rio Tinto have reportedly

pleaded guilty to taking

bribes. Their lawyers say all

four have disputed several

aspect s of if charges. The

Federal Government is under renewed pressure from the

Greens to start processing

aslyum seekers on the mainland.

Four boats carrying nearly 200

people have been intercepted

this week and are on their way

to Christmas Island. The

island's detention facility has

the capacititor another 80

people. The Greens say aslyum

seekers must be taken to the

mainland. The competition

watchdog is calling for

submissions on the proposed

joints venture between BHP

Billiton and Rio Tinto in Western Australia's Pilbara

region. The companies say the

joint venture will save them

$10 billion a year, the ACCC is

investigating whether the

venture would have the ability

to withhold supply from iron

ore markets. And a Sidney Nolan

painting of Ned Kelly has sold

for $4.5 million at auction.

The painting was sold to an

unknown telephone bidder and

reached more than $5 million

after buyer's costs were added

to the price. If 18 # 46 pointing 'First Class Marksman'

smashed the previous record of

almost $3.5 million for an

Australian art work. Pope

Benedict XVI has been haeb

accused of failing to act on

complaints about a priest who

allegedly abused 200 defer

boys. The victims have held a

news conference denouncing the Roman Catholic Church and this

is late nest a series of

allegations that have surfaced

in recent months months in a number of countries including

the pope's native Germany. The

BBC reports from the

Vatican. For months the Vatican

has been responding to

allegations of sex abuse by

priests as a succession of

claims emerge. Pope Benedict

has offered his apologies many

times. Now the abuse by this

priest, father Laurence Murphy

has brought the allegations of

cover up closer to Pope

Benedict himself. These

documents shown to the 'New

York Times' say that father

Murphy abuse around 200 defer

children over 3 years but that

the Vatican chose not tohim.

Father Murphy was a teach of

the deaf children. At a news

conference today, one of his victims spoke through his

daughter to explain how he has

been intimidated by Vatican

officials. It started when he

was 12-year-old. He reported to

many people St Francis police,

and no-one helped him, no-one

helped him and his class mates

and his frepsd. Father Murphy

was moved from his job in 197

?h? but still had contact with

children. In 1996 the bishop of

Milwaukee wrote to Pope

Benedict here at the Vatican.

There was no reply. Two years

later, father Murphy wrote to

him saying he had repented and

was in ill health. Three months

after that, the deputy wrote

back to the bishop si saying

father Mirfy should be relieved

of his public duties but not

defrocked and four months after

that father Murphy died. The

pope spokesman issued a

statement that says the case

was tragic. He made no mention

of Pope Benedict directly but

said the matter has been investigated by the civil

authorities and the case

dropped. Father Murphy hadn't

been push punished because of

his ill health. Pope Benedict

has spoken of his sadness about

what he calls this tragedy of

abuse by priests. Until anyhow

the allegations have been in

dioceses around the world

including Ireland. Victims'

groups now believe there are

questions about how much the

pope himself was personally

involved by failing to act. The FBI is investigating death

threats have been sent to

democratic legislators who

voted for US President Obama's

historic health care reform.

Law maeshs have also reported

having their offices

vannalised. For more Craig

McMurtrie joins us now. This is

all turning very ugly. Talk us

through what's actually

happened? Well, Joe, you're

right, it is getting very uggly. Essentially yesterday we

had Democrats coming forward

saying that they had received

voice mail messages, abusive

voile mail messages, some were

released, threatening voits

mail messages, they've received

emails, other Democrats said

that their campaign offices has

been van aldised. Bricks

through windows, a house, the

gas line to a house was cut in

Virginia, at the home of what

whoever attackid it thought was

a Democrat politician. It

wasn't as t turned out and all

those complaints are really

aimed at the Republicans in a

sense, the Democrats who have

been on the receiving emed are

blaming the Republicans for

inciting this ugly back lash.

Today we've seen one of the

laegd runs come forward and

he's rejecting this. He's

saying that no, Democrats

aren't the only ones on receiving end here, that his

office, a bullet was fired

through a window in his

campaign office and he's saying

that in his view it's

reprehensible that Democrats

has been raising this and he's

saying it's only feeding into

the hysteria and will lead to

more and there's no doubt that

there is a lot of concern in

Washington about this right

now. What about some of those

right wing commentate o, I've

heard some statements from them

and it really does sound like

they are just inciting

violence, is there any talk of

actually taking legal action

against them? Not that I am

aware of. But I think what we

can say about that is that the

language got so heated in this

health care debate that really

there was irresponsible remarks

made on both sides but the

problem now is that whether

it's whatever you might call

it, the lunatic fringe, whether

it's activists who have just

got way out of hand, it's fed

into a cycle now that's

becoming quite destructive and

quite worrying and I think it's

telling that even though we

have had Democrats and Republicans coming out

separately and saying that

they've been on the receiving

end and the FBI and police have

been called in and we've had

the Republican and Democrat

Congressional leaders holding separate press conferences to

try and take this down a notch,

we haven't actually had a joint

press conference if you like

with Democrat and Republican

leaders doing it together which

says something about the very,

very partisan climate here

right you now, the very

poisonous political climate It

really does expose this ugly

underbelly of American society

doesn't it? Well, it does and

look I've heard some comment on

raido, you would appreciate

that radio talkback is full of

this just as TV is and it's big

on the web as well, and all

sorts of things are being

talked ab, whether this tea

party movement, this movement

of conservative activists has

an underbelly if you like of

racism and whether this is now

being revealed as now being

seen in the light of day,

there's also suggestions that

perhaps this would not be

happening if it wasn't for the

fact that we have an African-American President in

the White House and it's for

all of these suggestions,

highly inflammatory, nobody

really is suggesting that the

tea party movement for example

which has quite a wide base in

America is racist and no-one is

really suggesting that this is

all about race directed at the

White House but the problem is

it is so ugly that it's very,

very inflammatory and I think

that politicians on both sides

are realising now that the

genie has been uncorked in this

very poisonous political

climate and there's a

realisation that it all needs

to be taken a little. The question is can they do

that Where does this leave the

legislation? Well the

legislation is going back to

the House. The reconciliation

package that went with the bill

that was passed through the

House a few days back, went up

to the Senate, there was a

reconciliation fix, it

basically some measures that the House required to be fixed

that the Senate also had to

approve, now the Senate has

kicked pack the recognise

simation fix fixes on two

meaner issue, which don't

really relate to the health care changes and it's expected

that that will come back to the

House and will be passed

without too much

trouble. Finally, on another

subject subject, Osama bin

Laden has popped up

again? Yes,, ehe has. There's a

new audio tape that's been

released given to Al-Jajeera,

they've played it where Osama

bin Laden is threatening to

execute Americans if Khalid

Sheikh Mohammed is executed. He

is see seen as the master mine

of the September 2001 attacks.

He and four others are expected

to face either trial in a

civilian court or a military

tribunal, that's still to be

decided. Now, Khalid Sheikh

Mohammed has said that he

intended to plead guilty. The

US Administration has made it

clear that they will seek the

death penalty. And Khalid

Sheikh Mohammed doesn't have an

issue with that. He said that

he would welcome death if

that's what happens, but Osama

bin Laden has decided if this

tape turns out to be authentic

of course, to use this to get

himself back in the headlines I

guess and make this threat. Craig McMurtrie in

Washington, thank you for

that. There's possible an

interesting discussion to be

had also about the role that

some of the news networks in

America have played too. Fox

News in particular has over the

last few months given a great

deal of air play to the

so-called liver movement, those

people who question that Barack

Obama is actually an American

citizen and they constantly

want more and more proof othat.

Those people who are largely

discredited by the rest of the

media get a lot of air play by

some have suggested is really

whipped up that sort of

quasi-racist aggression and an

tipthy towards him. I can't

believe some of the commentary

that they're allowed to get

away with in the State, like

we've got to go out and get

these bastards know now. I

don't know if that kind of

commendary would be tolerated

in Australia. Well certainly

not helpful for bod you

politic We'll take a look at

the front pages of the major

newspapers. The 'Australian'

reports that Tony Abbott's decision to demote Barnaby

Joyce is designed to boost the Coalition's financial

credentials. The 'Age' also

reports on Barnaby Joyce's

demotion and says the quick

reshuffle should head off damaging divisions in the Opposition. The 'Sydney Morning Herald' says Barnaby Joyce's

new role will throw him

straight into a fight over

water use in the Murray Darling Basin. The 'Courier-Mail' says

Senator Joyce has lashed out at

his colleagues saying they were more interested in beating him

than beating Labor. The Reserve

Bank of Australia has warned

that mortgage rates will have

to rise at half a perror

percentage point to return to

normal levels. The 'West Australian' reports that two business partners have been

cleared of insider trading

charges and will now pursue

legal action against Australian

Crime Commission officers. The

'Northern Territory News' says

a woman was forced to jump from

her balcony with a baby in her

arms to escape a man who

trapped her in his

apartment. The reports on

outrage over vandals attacking

the ACT bushfire memorial N

Hobart a map who prostitute ed

a 12-year-old girl and shared

the proceeds with her mother

has been jailed for ten years.

The 'Herald Sun' devotes its

front page to the first night

of the AFL season describing

Carlton's win over Richmond as

powerful. What was that word?

Say it again The 'Daily

Telegraph' has a big wlash on

the NRL, the front page also

reports on a poll that says NSW Premier Kristina Keneally is

Australia's most popular leader

now. And Adelaide's golden girl

of cycling Anna Meares has

overcome life threatening

injuries and a personal tragedy

to win gold at the world championships reports the

Adelaide 'Advertiser'. If you'd

like to send us your feedback

on any of the stories we're covering today - The top stories on ABC News

Breakfast - former Federal

Treasurer Peter Costello says

the Coalition is back in the

game after Tony Abbott's

frontbench shake-up. Mr Abbott

has duchd Barnaby Joyce from

the finance portfolio replacing

him with Andrew Robb. Pope

Benedict has been accused of

failing to take action against

an American priest suspected of

molesting up to 200 deaf boys. The victims claim that the

current pope knew about the

abuse and failed to act. The

Vatican denies there was a

cover up. The verdict for the

trial of Rio Tinto mining

executive Stern Hu will be

announced on Monday. Mr Hu and

three of his Chinese colleagues

have reportedly pleaded dwlt to

taking bribes. Their lawyers

say all four have disputd

several aspects of the charges. The Dubai Government

has created a multibillion

dollar rescue package for a

state controlled investment

company. Dubai world announced

last year it would be forced to

delay debt repayments because

of the groifs global financial

crisis. The company's major

creditors may also have to wait

up to eight years before they

get their money back. Despite

the sun certainty in Europe the

Reserve Bank has reiterated its

intention to keep raising rates

this year. The bias to return

to a neutral setting is in

sharp contrast to US mownary

policy-makers Exceptionally

low interest rates in the

United States under former Federal Reserve chairman Alan

Greenspan led to the housing

bubble which eventually mar fed

into the global financial

crisis. And just last month

current Fed boss Ben Bernanke

told Congress rates would once

again have to stay at

exceptionally low levels for an

extended period. Reserve Bank

assistant Governor Philip Lowe

used the same language as Dr

Person Bernanke as he warned of

the dangers of that

strategy. There is the impact on asset markets around the

world of an extended period of low official interest rates in

the major developed

economies. Mr Lowe went on to make it clear that the Reserve

Bank has a very different view

to its US counterpart? When the

global economy was in this

situation around five quaertion

with very low interest rates

things did not work out well.

While the current environment

is clearly very different to

that in the mdle of the 2000s,

this early experience suggests

that we need to watch the

financial side of the global

economy very carefully, particularly when interest

rates are low. NAB chief

markets economist Rob Henderson

says Mr Lo lour was highlights

the competing challenges facing

the United States and many

other northern hemisphere

countries which now also have

large sovereign debts. They've

got to maintain confidence nah

they can get those deficits

down in the future, but at the

same time not act too quickly

and stamp out the recoveriesry

are starting to emerge in their

economies today, so it is a

very difficult balancing act

with risks all around them. And

there are risks in Australia as

well as the Reserve Bank

remains concerned about the

prospects that a housing bubble

as demand picks up but spliep

remains constrained. Philip

Lowe warned the banks not to

make matters worse by

abandoning the more vigilant

lending standards adopted as a

result of the GFC. It obviously

would be unepful if a

speculative cycle were to emerge on the back of the

recent strength in housing

prices. Thing is an area that

lenders and home owners

including prospectsive home

owners will need to watch

carefully over the months

ahead Mr Lowe repeated the

RBA's view that interests will

continue what it calls a

gradual rise towards more

normal levels. Former ANZ chief

economist Saul Eslake who was

speaking on the same platform

believes we're not that far

from there now. The standard variable mortgage rate for

example is barely half a

percentage point away from its

average since the mid 19990s so if the Reserve Bank is aiming

to get that back to what it

describes as a normal level

that probably means there's

only a couple more quarter of a

percentage point increases in

the cash rate yet to go and

they don't have to move every

month in order to get there As its assistant Governor was speaking in Sydney the Reserve Bank was releasing its

statement of the stability of

Australia's finance sector

owner f They basically say that

the Australian banks and the

financial sector more generally

is well capitalised, it has had

a downturn in profitability but

they term that a shallow

downturn and prospects are for

better profitability ahead And

not surprising conclusion given

the profits of the major banks

topped 5.5 billion in the most

recent half, however the

Reserve Bank notes the quality

of their commercial loan books

has deteriorated rapidly and

and needs to be closely

watch. There is a significant

amount of debt tu for rolling

over over the coming two years.

Abroad as well as in Australia

and given the ongoing effects

of the financial crisis on the

securities markets where much

of that debt was initially

raised before the onset of the

global financial crisis, that

is something that the Reserve

Bank and regulators are rightly

concerned about On other side

of the ledgeter Reserve Bank

has noted that banks are now

more willing to lend to

business as market conditions

improve. On the markets -

In a few minutes Paul Higgins

will be here with a look at the

weathertor you and also we'll

have a review of some of the

newspapers this morning we'll

be joined by previous Greg

Barton from Monash university

but here is Paul Kennedy and

your tipping record in the AFL

this year is 100%? It wasn't

too hard last night. Carlton

beat Richmond. I did say it

would be closer than it turned

out to be. The Blues won by 56

points and they need not fear

Brendan Fevola not being there.

Their forward line worked

realliwell and Richmond on the

other hand struggled. Might be

a long season for the young

reforming Tigers. Let's have a

look at the highlights. Jared

Waite, kibs for goal and the

perfect start for him and if

Blues. Dishes off to Murphy, 55

out, bangs for goal, and gets

it. Margin back to 16 points.

It's a fair dinkum melee now.

Well tackled by Russell, Morton

knows how to kick a goal and he

might have done it, he has,

Tigers are in the game. Haile

Gebrselassie reloads, kicks

towards goal and another turn

proves extremely costly for the

Tigers. He's kicked 210 goals

in his career. He's a pro-.

He's done it. Those shiny new

adi Das boots on t, it will be

no problem. He slots it home

and the Blues win the game by a

thumping 56 points and start

the 2010 season on the right

note. Go to the rug and the

Brumbies are looking for a win

against the dheefz tonight. The

brums have been buoyed by a

very special return of Julyian

Huxley who just two years ago

was diagnosed with a brain

tumour. Many thought that he

could not come back but an

onfield return seems imment.

He's proved his doubters wrong

and that includes the Brumbies

captain Stephen who admit he is

didn't think he'd come back..

It's probable only hit home for

a few of us now just how

serious it was. I always now

that he kept trying to play the

whole time so two years a lot

of people thought he was made

and I actually probably was one

of those ones that doubted that

he'd get back but he's shown

enormous amount of persistence

to come back. Through the

legality of it all, just the

fact that for so many - for

about a year now it's been

blocked from the play. I think

the squad's got a huge buzz out

of that And the Formula One

will take police place in

Melbourne this weekend.

There's lot of people that have

got mixed feeling about Michael

Schumacher. He's got a very

strongol follow from his time

in Ferrari in Melbourne,

particularly the atoolian

community. They won't be

cheering for him this weekend,

he's crossed to Mercedes and

it's one of the big comebacks

of the year in sport. And he

has not given himself no

chance, of winning this

weekend. Hef says it will

tough. Let's hear from Michael

Schumacher. It's a great

challenge again to work in such

detail again with the team and

to develop projects and things.

That is what is the excitement,

because, you know, it's never a

stand still. It's always

ongoing process, and this is

what I feel quite happy to be

involved again. We have very

good ingredients but we have

very high competition as well,

so whether we make it or not

make it, that's another

question. But we're working

very hard on it and at the end

of the day yes I'm pretty sure

we will make it on the way

forward to the top to win

races. Whether we can win the

championship this year, that's a tough question, I have to

say, it's a long year, I have

been in much worse circumstance

in the beginning of the year

and still won a championship by

the end of it or the other way

around so I wouldn't - I'm not

feeling pessimistic at all. I

know it's hard work and that's

what go ahead for. It's funny how champion never rule

themselves out and he's won it

search times. He hasn't got

that doubt that others may

have. I think he thinks maybe

in a couple of years, maybe

next year, he might be in with

a chance. He likes the track. He's comfortable on the track

and he does well on it. He's

got a fondness for that

particular circuit. Maybe - I

guess it's first time around

for him in a new car in this

kind of car He finished sixth

in the last GP in Bahrain but

going on those reports from

that race you couldn't take

much out of it. There was no

overtaking. It was quite a

boring race and I don't think

they learnt much about

themselves and their new teams

in that race one. Mark Webber

traditionally hasn't done well

in Melbourne but his opposition

drivers say that he is driving

the fastest car, him and vettel

so watch maybe for Webber to

have a high finish on the pod

dwrum And the screaming noise

has be-German in Melbourne. You

can hear it right across

time All those residents who

live near the track will be

delighted that Formula One is

back. They certainly

will. Thank you. Snaez can be

watched snaz can be watched

live on the web from anywhere.

Here's Paul Higgins, what's

happening on the weather

front? Good morning. A cool

change is heading for parts of

Victoria, sauce Tasmania and

more storms across the top and

that's due to a reinvaguerate monsoon trough which will

intensify over the weekend,

there's still some slow cloud

on the Queensland coast, and

some cloud in the Bight as a

front and pressure trough push eastwards. Hot northerly winds

will be blowing ahead of this

trough but much cooler international south-westerlies

behind. More on shore winds for

Queensland kicking off a

coastal shower or two and we

have a deepening trough in the

west triggering thunderstorm.

Leading the news this morning, former Liberal

Treasurer Peter Costello says

the Coalition is now back in

the game of Tony Abbott dumped

his finance spokesman Barnaby

Joyce. Senator Joyce has moved

aside after a series of high

profile stumbles txs reshuffle

was caused by the departure of

snien. Even before the late

afternoon nount Barnaby Joyce

was the most hounded man in

Perth. Let's stop. He couldn't

confirm it. I can't. Until his boss had done the

honourablors. I'm here to announce those frontbench

changes. Officially sending the

colourful Queenslander on a

downward spiral to a different

job. Senator Joyce has moved

from the very important role of

finance to the equally

important role of regional

development and I think we will

continue to have a very strong

team into the future. Tony

Abbott is dressing up the

demotion but it's obvious this

is one gamble that didn't pay

off. Someone like Barnaby needs

to get out from behind a desk

and around the country. And

this will give him the

opportunity to do so. He's come

full circle. The man from the

bush was promoted to the

finance portfolio only three

months ago. What followed was a

series of bad headlines. We've

got $1.4 billion worth of Labor

Government - sorry 1,000 400

million dollars. Senator Barnaby Goose or whatever his

name is As the Government

ridiculed him other mistakes followed and in the end Tony

Abbott had to do something.. He

is absolutely no white bread

politician. What this is a

better fit for Barnaby as we

hone our political

attack. Barnaby Joyce never saw

himself as a liability. If you

see it as a lielt they ask you

to go. They don't give you

three more portfolio displs

he's take the g the setback

reasonably well I want Tony to

win There is one final shot for

some of his colleagues? We want

to ensure that we didn't have

the sort of continual

discussion by, you know,

unnamed third parties within -

to the media about our side

from our side and the way to

remove that dynamic was to go

forward like this His

replacement in finance is

Andrew Robb, back from a stint

last year suffering depression.

Ian Mcfarlane takes Nick

Minchin's job of resources and

energy. The do metion of buoy

will help the Coalition bolster

its economic credential and

neutralise one of the Government's most lucrative

line of attack but although the

Senate has been moved along

Tony Abbott can still expect

plenty of heat for appointing

him in the first place. One other noteable name was left

off the reshuffle list. Malcolm

Turnbull is apparently keen for

a comeback but he's not welcome

just yet. Should we win the

election, I would anticipate

offering Malcolm Turnbull a

senior role but given that the emissions trading legislation

is still before the parliament,

I thought it would be premature

to bring Malcolm Turnbull back

to the frontbench. All of which

suggests that a Turnbull

retirement appears unlikely. So

do you think Barnaby Joyce what

will be more effective for the

coalition in his new role?

In other news Pope Benedict

has been accused of failing to

act on complaints about a

priest who has been accused of

abusing up to 200 defer boys.

Two arch British hops made the

blants in the 1990s during the

pope's time as a cardinal. The

'New York Times' says a church

trial of the priest Laurence

Murphy was halted after he

appealed directly to future

pontiff citing ill health. The

Vatican said US civil

authorities had investigated

and dropped the case. Perhaps

and Germany have proposed a $34

billion rescue package for the

debt laden Greek economy. EU

leaders are expected to discuss

the Greek debt crisis in

Brussels today. Angela Merkel

said any aid for Greece must

involve the IMF. The European

central bank chief Jean-Claude

Trichet has spoken out against

the plan. Australian mining

executive Stern Hu as

reportedly apologised to his

employer Rio Tinto for

accepting bribes. News Limited

reported that Mr Hu used his

appearance in a Shanghai

courtroom in week to make the

apology N that court Mr Hu and

his dhez colleagues from Rio

Tinto have reportedly pleaded

guilty to taking bribes. Their

lawyers say all four have

disputed several aspects of the

charges. The Federal Government

is under renewed pressure from

the Germans to start processes

aslyum seekers on the mainland

ch four boats carrying 200 poet

have been intercepted this week

and they're on their way to

Christmas Island. The island's detention facility has the

capacity for another 80 people.

The Greens say aslyum seekers

must be taken to the

mainland. A Sidney Nolan

painting of Ned Kelly has sold

for a record price of $5.4

million. The painting 'First

Class Marksman' last night smashed the previous Australian

record for an art work by

almost $2 million. The painting

was sold to an unknown

telephone bidder at the

auction. And the win over this

year's Archibald prize will be

announced at midday today.

Environment and consumer groups

have raised fears that

Australia takes too long to ban

dangerous Chem kals

pesticides Several common

pesticides here are no longer

allowed to be sold in Europe

and activists argue the slow

response poses a risk to human

health and to vulnerable

ecosystems such as the Great

Barrier Reef. It's been a big

wet across much of Queensland.

Giving scientists the perfect

opportunity to find out what's

lurking in the water. We'd have

to measure the rivers in high

flow conditions because that's

when the materials transported

don the rivers So now's a good

time.. Exactly. This is also a

critical place. Because this

creek flows into the catchment

of the Great Barrier Reef. And

there's mouping evidence some

of the chemicals in this water

are harming a unique marine

environment. They're there at

the concentrations known to

cause damage to sea grass. And

coral. But environmentalists

are not pointing to finger at

agriculture, but rather Australia's pesticide

regulator. For not limiting and

preventing the sale of

potentially dangerous chemicals. It's not the

farmers, they deserve better

choices, we've got toxic

pesticides on the shelf that

have been banned in other

countries. We have to have a

very difficult job of balancing

both the protection of human

health and the environment and

facilitating access to

chemicals so that's the

difficult position in every

debate that we have when we

assess chemicals. The

Australian pesticides and vet

medicines authority or ABVMA is

the national body which decides whether chemicals should be a

available for sale and under

what conditions. The authority

is now under review with the Productivity Commission

proposal to expand its powers.

Taking over the role of State

Governments to control

pesticide use. This suggestion

has alarmed the World Wildlife

Fund. The APVMA does not have

the will, the budget or the

legal mandate to act in our

interests. And that is a very

scary thing. Looks like there's

a new flush of water coming

through today, John. The WWN

points to the work of water

scientists John Brodie and

Stephen Lewis. They've detected

the pesticide which is no

longer on the market in Europe

in the grat barrier reef

lagoon. Both the chemicals are

used to control Wednesday and

recent studies have shown that

exposure can turn male frogs

into females. How far out into the Great Barrier Reef can you

find trace of these

chemicals? Up to, we found them

anyway, up to 100 kilometres

off shore from the river mouth

so a long way out But they must

be very dilute that far off

shore? It di pends. In flood

conditions, in the rivers w

find anymore in what's called

the flood plum, the actually

river water that extends off

shore in a flood at

concentrations that are quite

significant The evidence is

sufficient for to us act. E-I

mate itself may not be sufficient for the pesticide industry but we should be

giving the doubt to humans and

the environment. The APVMA

acknowledged in a 2005

preliminary re view that water

run-off did pose an environmental risk and the

authority has prohibited the

use of the chemicals along

drainage lines but the

authority's chef chief says

unpress present legislation the

APVMA can't simply take a

chemical off the marketment The

legislation requires us before

we are able to take a chemical

away, we really need to look at

are there ways to mitigate the

risks that are identified. The

whole regulatory framework for chemical management Australia

is a risk based framework F you

can mitigate the risk then you

need to do so, so bans a

chemical is not necessarily the

only outcome of a review. The

environmental lobby is not the

only critic of the APVMA. The

consumer group 'Choice' accuses

the authority of failing to

remove knew yore toxins as Perm

et hrin which is freely

available in Australia yet no

longer on supermarket shelve in

the Europe The burden of proof

attempt is the wrong way around

in Australia. For instance in

the ex-U the burden of proof is

with the manufacturer to

provide evidence of safety. At

the moment, here we have a more

wait and see approach. The

farming lobby agrees the

national pesticides authority

needs more resources and it

would like to see better

coordination with State

Governments. But the national

Farmers Federation is alarmed

at the idea of the authority

being more prepared to ban

chemicals. The precautionary

principle where you say if you

can identify any risk at any

time, regardless of whether you

manage the risk, then you

should halt the process,

obviously that opens the

process up we believe to

vexatious claims and could make

it very difficult to get access

to safe high quality

chemicals. The APVMA says just

because a chemical is no longer

being sold to Europe doesn't

necessarily mean it should be

banned in Australia. Sometimes the manufacturers themselves

make that choice not to pursue

a market in one country or

another. And that creates the

sense that there is fewer

chemicals or that some

countries perhaps are banning

more chemicals. It's not that

their banning the chemical,

that's that the manufacturers

have chosen not to continue to

support those chemicals in

those juries dicks What does

that say about our system of

chemical regulation here in

Australia? Well basically I'm

prepared to say it just doesn't work. The principle that we

apply is that we apply caution

where the science is undecided

or uncertain. That's the very

basis on every way that we do

our assessments and make our

decisions. Now the Prince of

Wales has become the most

senior royal to visit British

troops in Afghanistan in a

surprise trip to the country. Prince Charles told

troops at Camp Bastion he just

wanted to come and say thank

you. This was a high risk

mission for the heir to the

throne arm adjourn gri Kabul in

the north to the desert in the

south and the front-line in

Afghanistan's war. It was a

chance to see first hand what

Helmand province is really

like. We flew to a remote base

in a district where British

forces have been engaged in

years with the Taliban. Make no

mistake, this is a dangerous part of the country. Interesting when you

first gotter Prince Charles is

the most inner member of the

royal family to come here and

security was extremely tight.

Prince Charles has come here to

see for himself the conditions

and the dangers faced by

British troops serving on the

front-line and they are very

real. One of the pla toons

based here recently lost their Sargeant and there's been an

increase in Taliban activity in

this particular location. This

was a trip that the Prince had

wanted to make for some time.

He spong to troops about their

work here. The mission they've

been asked to carry out. And

the threats they face. Prince

Charles is closely involved

with a number of regiments and

writes personal letters to

bereaved families. I know when

my youngest son was out here,

as a parent you worry the whole

time. I think if you're out

here perhaps you're getting on

with everything, is not the

same, but for everybody left

behind it's dasly. This was

also a chance to meet Afghan

leaders to discuss local

politics,. How to bring jobs to

one of the world's poorest

countries, and his respect for

Islam. At the end of the visit

Prince Charles laid a wreath at

a simple memorial to British

troops who have lost their

lives. Thousands of Afghans

have also died in a conflict

that's now in its nooipt year

and has yet to show long-term

signs that it's getting any better. You are watchling ABC

News Breakfast. These are our

stop stories this morning,

former Federal Treasurer Peter

Costello stays Coalition is

back in the game of Tony

Abbott's frontbench shake-up.

Mr Abbott has dumped Barnaby Joyce from the finance

portfolio replacing him with

Andrew Robb. Pope Benedict has

been accused of failing to

stake action against an

American priest subpoena odd v

of molests up to 200 death

boys. The victimses claim that

the current pope knew about the

abuse and veil failed to

act. And Australian mining

executive Stern Hu has

reportedly apologised to his

employer Rio Tinto for

accepting bribes. News Limited

reports that Mr Hu used his

appearance in a shang high

courtroom this week to make the

apology. The verdict in Mr

Hug's trial will be announced

on Monday.

We're joined by Professor

Greg Barton from Monash university. Good morning. Good

morning. Nice to see you.

You're joining us on another

day of reasonably high

political drama? That's right.

It seems to happen that

way. The he shuffle yesterday

and many expected that Boyce was elegantly escorted out of

the finance portfolio? One gets

the impression he was waiting

there for some time but of

course the resignation of Nick

Minchin was a perthe feblingt

time to reshuffle and do this

gracefully. We'll star with a

cartoon from the 'Herald Sun'

which shows the leader of the opposition saying that Barnaby

Joyce of course is no white

bread man, but Barnaby Joyce

says no I'm toast. To be fair

to Barnaby Joyce, he hasn't

taken such a psz mystic view of

things but clearly the interpretation has been tough

on him Look at how Mark Knight

is drawing Tony Abbott?

Fascinating. He's almost

drawing I'm like a grey hound

or something? He looks strong

and powerful And those ears

mpls and that nose too. And

have you noticed in the

coverage this morning any fightback from Barnaby Joyce,

any comments? You've got to

give him credit. He's got lots

of spifrt and he's saying we

can do this, he's doing more

work, so he dent see it as bad

news at all and Abbott has been

very graceful which is both to

his credit and also politically

very asuit The companitators

largely agree also that if

you're going to use a pave Rick

like Barnaby Joyce you've got

to use him properly, that is

get him, let Barnaby be Barnaby

as the west saying goes? And

don't let him comment on

matters of economic

fundamentals that he seems to

constantly get wrofnlg his

credibility was on the lean as

Opposition spokesman on finance

but if he's attacking Penny

Wong on climate change or

something it's more safe We

have some, some choice quotes

on page six, the wisdom of

chairman Barnaby, for example

on foreign investment, we have

the difference between a

corporation and a Government is

Governments have armies. This

is the don fusion I don't want

my nation to get into to. What

he was intending there is not

clear. You can see why it

undermines his credibility but

when he smoke about debt that

was where he - Australia Aushas

approximately a tent the debt

ace are ratio of its OECD peers

and Joyce seems to reverse

that. The Government has come

out saying this proves that

Tony Abbott just done have the

economic credibility to get rid

of him earlier. Tony Abbott

made the decision to get rid of

him and now the Government's criticising the time it took to

do it. Is the Government in any danger there of being accused

of being a little hypocritical

with this this WA of negativity

that it accuses the Opposition

of all the time? They have to

be very care. Abbott is good at

going on attack. Le also

manages to preference a sense

of being a decent bloke and

decent to his colleagues and he

certainly acted in a decent way

to Joyce. I think it's to his

advantage that he took his time

and waited for an opportune

circumstance to move Joyce

aside. There was another story

in the 'Age' that you wanted to

look at on the comment

page? That's right. Michelle

Grattan has a very nice op ed.

The graphic that goes with this

as Tony Abbott in his natural

environment on a bicycle but his colleague Barnaby Joyce is pedalling in the opposite

direction on the tandem bicycle

but in fact Michelle

depratian... - But Grattan in

fact is not having a go so much

at Joyce in this op ed, she's

talking about the fact that the

door has been closed shut in

the face of Malcolm Turnbull,

that he'd sort of put his hand

up and said, "Look... Are you surprised that Tony Abbott didn't welcome Malcolm Turnbull

back to the fold as a talented

performer? As a importantly

leadership threat? I think that

in something he would have had

to consider. There's a lot to

be said about Turnbull in terms

of his basic capacity but at

the level of leadership threats it's looking increasingly likely that Abbott won't be

able to punch through at this

election and be many for

another term. Abbott can

certainly go up to this

election but whether he can

hang through a full second term

of a labour Government and into

a second election is uncertain

given the history of leadership

that the Coalition recently so

having Turnbull sitting beside

him might have been too scary.

F your prediction comes true

that the Opposition can't punch

through if that result is a

particularly bad one for the

Opposition then the nature of

political parties is that they

will turp on him and Malcolm

Turnbull would want to be

considered as someone who could

take the party to the centre In

fact Tony Abbott may have done Malcolm Turnbull a favour.

Let's go international and take

a look t the 'Australian' this

morning and a senior Pakistani

is due to visit US There's been

a delegation in Washington over

the last few days meeting with

with the Secretary of State.

What's significant about this

is that - it's not unusual to

have senior foreign delegations

in Washington. The photograph

is fantastic. That's such a

great photograph. It is. It's

not quite relevant to story to

much but anyway it's a great

frf. What's interesting about

this delegation visiting is

that US-Pakistan regulations

have been just abysmal for

years and although after 9/11

there was some success in

getting Pakistan to take the threat of terrorism

seriously. Just in the last six

or search months we've seen

Pakistani forces making

significant gains in the

security situation? Once senses

there's been a real sea change.

They're finally facing up to

the fact that the Taliban is a

Pakistani problem. Improved

releases with Washington very

welcome. Back to the 'Age' this

morning, your favouring this

newspaper. I'm suspecting

Fairfax pias today. You're

looking at Australian troops in

Kandahar?. It wasn't so much

that I wanted to focus on the Australian Idol, just that the

'Age' happens to carry this

story in full. It talks about

the fact that yes, although

there's been some debate about

whether Australia wants more

troops to go to flg

Afghanistan, there's more

likely that more Australian

troops will be in hand har.

There'll be a second operation.

The operation we've seen the

last few months seem to to have

gone very well and that

suggests there's a real sort of

move forward in Afghanistan The

current troops will be

redeployed or that new troops

will go over to Kandahar? At

this stage we seem to see a re deploy. There could be

increased troop numbers which up until now has been ruled

out. The fact that things seem

to be going quite well in Afghanistan and that steadily

the south seems to be taken is

good news and the fact that

Australia's playing a key role

is significant, this ties in

with that story about the Pakistani delegation to

Washington, that things seem to

be moving aed in that difficult

corner of the world And the population growth issue seems

to be bubbling along? It does.

No question we've just passed

22 million, that we've taken 40

years to add the last 10

million but much less for the next and there's a question of

our carrying capacity if you

will. Some of the papers this

morning are carrying stories

about will this damage our sort

of Kurt and our herrage. Can we

hold together. Others are more

Sangin. The story in the

'Financial Review' point os the

fact that we need population

growth for economic growth Do

we have the housing for

them. That's the other argument

that's there as well. Thank

you. Here is Paul Higgins with

a look at the weather. Thank

you. It's been an unusually

mild night across parts of

south-eastern South Australia

staying above 21 in Melbourne

and 19 in Hobart and Adelaide

but a cool change will hit each

of those cities today. Fine and

I in Queensland and some

thundary rain in the Farr north.

We asked a moment ago what

you thought of earth hour,

that's coming up this weekend.

Paul on FaceBook has responded

and said, "The opposition to it

is yet another cynical move by

right wing climate change

deniers. This isn't about any healthy scepticism on their

part, just that they adamantly

to refuse to believe any of