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Inflation flags rapid increase in cost of living

Inflation flags rapid increase in cost of living

Broadcast: 23/07/2008

Reporter: Josie Taylor

Inflation figures may have confirmed the cost of living is increasing faster than any time in the
last 12 years. The Federal Treasurer says it is a global problem the Opposition blames inept
economic management.


WAYNE SWAN, TREASURER: This is a very significant figure. The truth of it is there in the figures.
And there's no point in trying to sugar coat it at all. It's a very substantial problem.

JOSIE TAYLOR: Wayne Swan says it's a big domestic issue that he inherited, and he's blaming global
forcesm, the credit crunch, and high oil prices

WAYNE SWAN: But these aren't prices that are in control by the Federal Government. They are set
globally and they are putting a lot of people, including a lot of business, under pressure.

That's why we fought so hard to deliver the tax cuts in the Budget and the additional assistance in
the Budget to provide some relief.

JOSIE TAYLOR: But the Opposition says the Government's first Budget added to inflationary
pressures, with new taxes on pre-mixed drinks, health insurance and luxury cars.

MALCOLM TURNBULL, SHADOW TREASURER: Every single inflation result from now on since that Budget,
every single interest rate rise, is owned by Wayne Swan.

He is creating the environment that puts upward pressure on inflation and that puts at risk the
homes, the living standards, the jobs of Australians all around this country.

KATIE DEAN, SENIOR ECONOMIST, ANZ: It really is a combination of global and local factors. You
could certainly argue that, you know, the global economy is providing an inflationary impulse into
Australia at the moment, but likewise we are seeing increases in a broad range of domestic goods
and services and these are not being driven by tax rises alone.

JOSIE TAYLOR: Economists recently gave home owners some hope the next time interest rates moved
would be down. That now seems unlikely. Instead some economists are predicting a rate rise could be
on its way.

MICHAEL BLYTHE, CHIEF ECONOMIST, COMMONWEALTH BANK: I certainly think that's the direction of risk.
It really comes down to what side of the economic debate you're sitting on; you either think the
economy will keep slowing in which case inflation will probably pull back from here.

Or do you believe the commodity story and the big income boost that will be flowing through the
Australian economy courtesy of recent increases in coal and iron ore prices, will that outweigh the
negatives at work? And we tend to favour the commodities story.

Maybe we don't get another rate rise, but I think the speculation that has been building over the
last few weeks about the possibility of rate cuts is looking a bit misplaced at this point. I think
the foot will be kept on the brake until pretty clearly that slow down the Reserve Bank wanted to
see in the inflation numbers is showing up

JOSIE TAYLOR: And if the Reserve Bank holds firm, the Treasurer warned the big banks to think
carefully before raising rates independently.

WAYNE SWAN: They have a choice between their shareholders on the one hand and their customers on
the other. We do need to have an eagle eye on competition in the sector and we do.

JOSIE TAYLOR: Some words of comfort, perhaps.

Josie Taylor, Lateline.

Opp vows to delay carbon trading

Opp vows to delay carbon trading

Broadcast: 23/07/2008

Reporter: Sarah Clarke

The Federal Opposition Leader Brendan Nelson has re-entered the debate on when a carbon trading
scheme should be introduced, saying it would be 'foolhardy' to commence before 2011.


LEIGH SALES, PRESENTER: The Federal Opposition Leader has re-entered the debate on when a carbon
trading scheme should be introduced.

With the Prime Minister and the Greens today saying it has to start as soon as possible, Brendan
Nelson said it would be foolhardy to commence before 2011 at the earliest. The message has angered
the Government and triggered more debate on the best way to cut Australia's spiralling emissions.

Sarah Clarke reports.

SARAH CLARKE, REPORTER: The Government has until the end of the year to win over the climate
sceptics and unveil its White Paper on an emissions trading scheme. It wants the market to be up
and running by 2010. The Opposition wants it delayed.

BRENDAN NELSON, OPPOSITION LEADER: You cannot responsibly start an emissions trading scheme earlier
than 2011, and preferably in 2012.

SARAH CLARKE: That's not in the national interest according to the Prime Minister.

KEVIN RUDD, PRIME MINISTER: We have a clear-cut course of action for the future. The Liberals are
playing short-term politics and they should get real.

SARAH CLARKE: Without Coalition support, the Government will be forced to strike a deal with the
Greens. Bob Brown isn't budging on a start date.

SENATOR BOB BROWN, AUSTRALIAN GREENS: The scientists are telling us we must take action now and
that's the responsibility we have.

SARAH CLARKE: Industry has just two months to respond to the Government's pollution plan. Today the
Australian Workers' Union came up with its own novel idea. It wants the big polluters to hand over
their free carbon permits to their employees if they decide to move offshore.

PAUL HOWES, AUSTRALIAN WORKERS' UNION: Who could then sell those permits to be able to find a form
of income, to retrain themselves and to give themselves the support they need to transition into
other industries into the future.

SARAH CLARKE: But not everyone is convinced the Government has considered all the key polluters in
its carbon reduction plan.

BOB BIRRELL, MONASH UNIVERSITY: The major driver of growth in greenhouse gas emissions has been
population growth and it most certainly will be in the future.

SARAH CLARKE: And if immigration remains at current levels, Dr Birrell says Australia's population
will increase to 31 million by 2050 and the Government has little chance of meeting its greenhouse
emissions target.

Sarah Clarke, ABC News.

Cabinet talks recognition with Indigenous leaders

Cabinet talks recognition with Indigenous leaders

Broadcast: 23/07/2008

Reporter: Hayden Cooper

Prime Minister Kevin Rudd and most of his Cabinet spent the day meeting Aboriginal leaders and
anyone else who had a question. The Government was presented with a new petition calling for
constitutional recognition while there were many demands for an end to the federal intervention in
Aboriginal communities.


LEIGH SALES, PRESENTER: Kevin Rudd and most of his frontbench have spent the day in Arnhem Land,
meeting Aboriginal leaders and answering anyone who had a question in the latest of the
Government's community cabinet meetings.

The Prime Minister was presented with a petition calling for constitutional recognition of
Indigenous rights and fielded demands for an end to the federal intervention in Aboriginal

Hayden Cooper reports from Yirrkala.

HAYDEN COOPER, REPORTER: They came from across Arnhem Land to have their voices heard at the
highest level. And on this occasion, most of the Cabinet was there.

KEVIN RUDD, PRIME MINISTER: Welcome to the first meeting of the Commonwealth Cabinet here in
north-eastern Arnhem Land ever in history.

HAYDEN COOPER: The Prime Minister reverted to his favourite trick, to win over the audience.

KEVIN RUDD: Namanenee (phonetic), who... and I'm really sorry about my language.

HAYDEN COOPER: Holding a Cabinet meeting in Yirrkala means the welcoming party is unlike any other.
But beneath the energetic welcome, there are basic and persistent problems occupying the minds of
the locals.

INDIGENOUS WOMAN: We want to see things changed. We want the Government to put in funding into more
Aboriginal and mental health workers. We want to see more services being provided for the health
issues that are very, very important for all Yolngu. And what is the outcome of it? Closing the
gap, is there enough to do it?

INDIGENOUS MAN: We need education, education is really a priority for us in the Ringwood area.
Without education we (inaudible) survive.

HAYDEN COOPER: The response was a promise for action but no guarantees about how long it would

KEVIN RUDD: Words without actions are like a hollow sounding gong. Words with actions mean

HAYDEN COOPER: It's been 45 years since Yirrkala Aborigines spoke out against mining on their land.
In 1963, they used a bark petition. Today, the access to the policy makers has improved but they
employed the same symbolic message. The region's senior elder called for full recognition of
Indigenous rights in the Constitution.

GALARRWUY YUNUPINGU, COMMUNITY ELDER: These rights are self-evident. These rights are fundamental
to our place within Australia's nation. We ask for your leadership Mr Prime Minister to help the
Commonwealth Parliament start the process of recognising of these rights through serious
constitutional reform.

HAYDEN COOPER: In full ceremony, the new petition was received.

KEVIN RUDD: Thank you for this extraordinary welcome that you have provided to us this day.

HAYDEN COOPER: And Mr Rudd offered detailed and sensitive talks on Constitutional recognition.

KEVIN RUDD: We as the Government of Australia are proud of our Aboriginal heritage in this country,
and we are proud also of our Aboriginal future in this country.

HAYDEN COOPER: While the goodwill generated by an event such as this is undeniable, it doesn't
eliminate the underlying tension in this community over one vexing issue - the Federal

DJAMBAWA MARAWILI, COMMUNITY ELDER: It has to stop because I think we are human beings, we can
survive and we can run out own affairs.

HAYDEN COOPER: The Government's review of the intervention is close to completion, but until then
Mr Rudd is making no promises.

KEVIN RUDD: We're engaged in a proper process of review of the entire intervention.

HAYDEN COOPER: It's an issue that continues to divide political and Indigenous leaders.

Hayden Cooper, Lateline.

Julia Gillard joins Lateline

Julia Gillard joins Lateline

Broadcast: 23/07/2008

Reporter: Leigh Sales

Deputy Prime Minister Julia Gillard joins Lateline to discuss today's Cabinet meeting as well as
inflation and carbon trading.


LEIGH SALES, PRESENTER: Well to discuss today's cabinet meeting in Arnhem Land as well as inflation
and carbon trading. I was joined just a short time ago by the Deputy Prime Minister Julia Gillard
in Darwin.

Julia Gillard thanks for being with us.


LEIGH SALES: Do you support amending the constitution to acknowledge Indigenous rights?

JULIA GILLARD: What the Prime Minister said today when we took the Cabinet to East Arnhem Land was
there's a three-stage process this Government is going through.

First, of course we apologised to Indigenous Australians for the Stolen Generations. Second, we are
very focused on closing the gap, on making a real measurable, practical difference to some big
picture questions like closing the gap in life expectancy; closing the gap in literacy and
numeracy, in year 12 retention and in employment outcomes.

Today, the Prime Minister when asked about constitutional recognition said that's a matter that has
been in the Labor Party platform for a long period of time.

It's a matter we will consult Indigenous and non-Indigenous Australians on, and a matter we will
work towards in that consultation. Obviously for such a move to be successful, a community
consensus needs to be built and the purpose of the consultation would be to further that community

LEIGH SALES: Kevin Rudd made his apology to the Stolen Generations very quickly after assuming
office, yet since he's been Prime Minister this is only the second time he's visited a remote
Aboriginal community, in fact he's spent far more time overseas.

Doesn't that speak volumes about the Rudd Government's priorities?

JULIA GILLARD: I think what speaks volumes about the Rudd Government's priorities is we do have a
community Cabinet process, that we do ensure that Cabinet meets in communities for the purpose of
talking to community members about what they want and what they need.

We understand that the view from Canberra isn't always the view that gives you the complete
picture, that there's much wisdom on the ground.

That's why we've been to Perth for a community Cabinet, we've had one in Brisbane, and of course
today we had one in Arnhem Land, and we've had them in other locations.

And it's part of the Government's commitment to being out there, listening to Australians and
learning from them what they want from Government, what they see right, what they see going wrong;
what they want fixed.

LEIGH SALES: Alright let's move on to talk about inflation we've heard today about the higher than
anticipated inflation figure. Does that give Reserve Bank the ammunition it needs to raise interest

JULIA GILLARD: Well I won't speak for the Reserve Bank, what I will say of course is we inherited
inflation at a 16-year high.

And having inherited that inflation challenge we've now seen it made more difficult by global oil
prices, the huge jumps we've seen in the price of oil globally, and of course turbulence in global
financial markets.

LEIGH SALES: But are you anticipating further interest rate rises?

JULIA GILLARD: Interest rate rises are a question for the Reserve Bank and I'm not speculating on
the Reserve Bank and what it may or may not do.

What I am saying is we inherited a high-inflation environment that's been fed into now by global
factors. The challenge has been made more difficult.

The Government is dealing with inflation as we can through strong Budget surplus and of course
investing in those things that build capacity in the economy.

We know for example that skills shortages put upwards pressure on inflation. We're critically short
of skills in a whole range of areas. That's why we've responded urgently by already creating 24,000
new productivity places, 24,000 people enrolled, getting the skills that our economy needs.

And that's the start of our plans to really invest in a huge redevelopment of skills in this nation
with 630,000 new training places.

LEIGH SALES: Do you think that the economy is already slowing sufficiently to keep inflation in

JULIA GILLARD: Well with inflation the things that we can control, the things that we can do, is we
can have prudent government budgeting, we can have a strong surplus and we did that in May.

LEIGH SALES: Yes but is the economy slowing sufficiently to keep inflation in check?

JULIA GILLARD: Well the things we're doing to fight inflation include the Budget surplus; it
includes in investing in the capacity constraints on the economy.

Obviously we have seen some slowing down, that's been a result of the interest rate rises, we've
seen eight interest rate rises in the last three years. Obviously they have put pressure on working
families and have led to a slowing down in the economy.

But the inflation challenge is squarely in front of us. We inherited it at 16-year highs. It's been
exacerbated by global factors like global oil and the turbulence in financial markets.

We are continuing to fight inflation, prudent government budgeting is a big part of. That we
delivered that in May. And investing in the capacity of the economy, particularly in skills, is
another big part of fighting inflation over the medium term.

LEIGH SALES: Labor's emissions trading scheme will drive up prices for a whole range of goods and
services. We're already in and inflation environment. Doesn't that lend weight to the Opposition's
argument that we should delay starting an emissions trading scheme?

JULIA GILLARD: Well on the question of what the Opposition thinks about our carbon pollution
reduction scheme I have to frankly say I just don't know. I mean every day I hear a different
position from a different Opposition spokesperson.

LEIGH SALES: What I want to ask you though is doesn't the inflation figure lend weight to their
argument that we should delay starting an emissions trading scheme?

I'm not talking about the disputes on their side about their position. I am asking a very straight
forward question - does the inflation figure mean we should delay the start of the ETS?

JULIA GILLARD: We've got to stay on course with our Carbon Pollution Reduction Scheme. We've got to
stay on course to deal with the challenge of climate change. And that's what the Government is

That's why we've published our green paper for consultation; that's why we signed Kyoto; that's why
we're getting on with the job of doing what is a very difficult policy but needs to be done and why
we're doing it in a sensible and measured way.

When it comes to the Opposition, as I say, their position changes daily. They're not dealing with
this critical problem in the national interest. They are using it as a play-thing in their internal
party politicking and the disputes within the Liberal Party.

The Government is very focused on dealing with climate change. A Carbon Pollution Reduction Scheme
is a vital part of that. That's why we've put out the green paper; that's why we're seeking
community input on the green paper, so we can keep moving forward.

LEIGH SALES: The Opposition Leader Brendan Nelson says the Coalition may back Labor's emissions
trading scheme with responsible amendments, and one of the things he wants is start date no earlier
than 2011.

Given that Labor has nominated 2010 as an ambition only, surely you couldn't accommodate the
Coalition on that.

JULIA GILLARD: Well it brings me back to the point I made earlier. I mean the position changes
daily. That may be Dr Nelson's position is today but who knows what the position is going to be

LEIGH SALES: No but their policy has always been, even leading up to the last election, that 2011
or 2012 would be the best dates for an emissions trading scheme.

That's not really that far off what you're asking, and given that you're going to need compromise
to get this through the Senate, surely that is something you could agree on?

JULIA GILLARD: Well what the Government is doing is we're sticking to the position that we
campaigned on, which is we needed to act on climate change, that we had to ratify Kyoto, that we
needed a carbon pollution reduction scheme and we're in the business of making sure we're doing
that in a sensible and measured way, giving the community full opportunity for consultation.

The Opposition, its position does change daily. I've heard it described the Government's plans as
going to wreck the economy one day and the next day they say they're a carbon copy of the Liberal
Party's plans.

Well these two positions are mutually irreconcilable. I mean who knows what these people are
talking about. Consequently we will let the Liberal Party get on with its bickering and back

And while they're doing that we will get on with the job. And getting on with the job is following
through process we said we would go through to design our Carbon Pollution Reduction Scheme.

LEIGH SALES: Has the Labor Party been war-gaming the possible return of Peter Costello to the
Liberal leadership?

JULIA GILLARD: The Liberal leadership is a matter for the Liberal Party. And whether they want Dr
Nelson to stay in the job or want Peter Costello to take the job, that is a matter for Liberal
Party members.

At the end of the day, I think this comes down to an analysis of the policies. I mean, Brendan
Nelson, Peter Costello, they were all part of a government that fervently argued for WorkChoices.

Peter Costello would come to the dispatch box in Parliament every day and tell us how WorkChoices
was so important. Brendan Nelson did the same, every day in the lead-up to the last election.

They are people who believe WorkChoices, they are people who grew out of touch with working
Australians, they're people who denied climate change and refused to act on it, they're people who
allowed our education system to go into decline, meaning that the Rudd Labor Government needed to
bring the education revelation to rebuild it.

They're people who endlessly played the blame game with the States rather than sitting down and
improving services.

LEIGH SALES: They're also people who might be changing leader some time in the near future and in
these tough economic times surely it would be Labor's worst nightmare to have a former
long-standing and successful Treasurer as Opposition Leader.

JULIA GILLARD: I think Australians at the last election judged on the policies and they judged on
the basis of who was best to build long-term plans for this nation's future.

They also judged on the question of who was in touch with working families and my point is simply
this, whether it's Peter Costello or Brendan Nelson, they were so fundamentally out of touch with
working families that they thought WorkChoices was good for them.

And if you scratch beneath the surface of either Brendan Nelson or Peter Costello, they still
believe in that kind of extreme radical industrial relations policy today. It's those kinds of
things the Australian people are going to judge on.

LEIGH SALES: Before you go, I'd like to ask you about the issue of overseas tax havens which has
been in the news recently. Why do you think it is that more Australians are using them?

JULIA GILLARD: Well, I don't know on the question of the numbers but obviously the Government does
everything it can to maintain the integrity of the tax base here.

We believe it's important that everybody pays their fair share. At the end of the day tax dollars
are used to provide very vital government services whether it's education, health, roads, all of
the things that we rely on, defence, things that are clearly in the national interest.

So we do do everything possible to maintain our revenue base in good repair to make sure that
everybody is putting in what is fair.

LEIGH SALES: The Australian tax office though has noted over the past year there's been an increase
in the use of the overseas tax havens to the tune of about $16 billion going offshore.

Surely the Government must be looking into though why this is happening?

JULIA GILLARD: The Government is obviously always looking at the best way of making sure that
Australians pay their fair share of tax.

It is something that requires constant monitoring and review. The nature of the making of tax
arrangements for people who are into tax arrangements of this kind is that these arrangements

People look for new ways, new loopholes and new things to exploit, and so Government is always
acting, always monitoring, to keep the tax base in good repair and to make sure, as I say and, and
the proposition is a very simple one, that Australians are each paying their fair share of tax.

LEIGH SALES: The Government staying ahead of the game though given the figures we've seen come out
from the ATO?

JULIA GILLARD: The Government does everything it can to make sure we're keeping the tax base in
good repair. It's obviously something that we do constantly. It's something that we monitor
constantly and review constantly.

But the message from Government is a very clear one; the message is a very simple one, that is that
it's appropriate for everyone to pay their fair share of tax.

LEIGH SALES: Will the Government be seizing the opportunity of the tax review it has under way to
look at this issue and perhaps look at tightening laws or increasing penalties to crack down on it?

JULIA GILLARD: The Henry review is about our tax and welfare system, it's about the nature of our
tax and welfare arrangements. It is not a compliance review in the sense that you've put it;
compliance is monitored and assessed by government continuously.

Obviously we work with the Australian tax office and Treasury on those questions.

LEIGH SALES: Deputy Prime Minister Julia Gillard thank you for joining Lateline.


Karadzic to appeal extradition

Karadzic to appeal extradition

Broadcast: 23/07/2008

Reporter: Rafael Epstein

Lawyers for alleged war criminal Radovan Karadzic say he will appeal against his extradition from
Serbia to the Netherlands to stand trial in The Hague. Karadzic was arrested in Belgrade last


LEIGH SALES, PRESENTER: With alleged war criminal Radovan Karadzic now in custody there are growing
calls for Serbia to quickly track down and arrest his former right hand man Ratko Mladic.

Serbian intelligence officers were on the trail of general Mladic when they stumbled upon Mr
Karadzic and arrested him last Friday.

Lawyers working for Mr Karadzic say he will appeal against his extradition from Serbia to the
Netherlands to stand trial. And that he plans to conduct his own defence.

Europe correspondent Rafael Epstein reports from Belgrade.

RAFAEL EPSTEIN, REPORTER: Serbians now know they're living in a different country. Just a few weeks
with a new pro-western Government and a hero of the 1990s has become today's villain.

VOX POP (translation): It's sad. It's sadness. It's a day of grief for Serbian people. We sold the
man who created the Serbian Republic. We've sold ourselves.

VOX POP 2 (translation): I think it's a positive step for Serbia. I think Serbia is going to move

RAFAEL EPSTEIN: He was one of the world's most wanted men, but barely recognisable he was living in
the same city as those looking for him.

The former psychiatrist and sometime poet was posing as an alternative healthcare practitioner.
Those he worked with say they had no idea who he is really was.

CO-WORKER: If you look at the photos of him now would you have guessed that he was the rather
bohemian monkish Radovan Karadzic? No-one suspected him. Otherwise we'd have got the $5 million

RAFAEL EPSTEIN: And it seems he impressed them with his knowledge.

CO-WORKER 2: He was a very nice, pleasant, and smart. And he knows everything about everything.
Psychiatry and spiritually and all sorts of things.

RAFAEL EPSTEIN: The EU will give no reward to Serbia until they capture Ratko Mladic as well, the
Bosnian Serbs wartime leader.

He commanded the fighters who killed 8,000 Muslims at Srebrenica. And his men surrounded Sarajevo
for years.

So the US is celebrating one arrest and asking for the next.

ZALMAY KHALILZAD, US AMBASSADOR TO THE UN: It shows that you can hide for a long time but
ultimately what you've done catches up with you.

He was responsible for some of the worst crimes committed on the continent of Europe since World
War II. So we rejoice in his arrest, and hope that Mr Mladic will have a similar fate and soon.

RAFAEL EPSTEIN: The arrest of Mladic could provoke and angry response. But the new wave of
politicians here is confident.

ZORAN VULETIC, SERBIAN LIBERAL DEMOCRAT POLITICIAN (translation): There won't be any violence. The
Government knows how to handle this. And they've handled the arrest well.

RAFAEL EPSTEIN: This was Karadzic at his most defiant. Speaking in 1995 after he'd been accused by
the war crimes tribunal, insisting he'd done nothing wrong.

RADOVAN KARADZIC (1995): No Sir. I am President and I make my decisions and give my orders that are
all known and public.

RAFAEL EPSTEIN: One senior politician from the ruling coalition says the arrest might just change
Serbian attitudes.

ZORAN VULETIC (translation): I hope this is a chance to start talking about war crimes. But I don't
expect that to happen. People will soon lose interest.

RAFAEL EPSTEIN: The West still has to do a lot to win over a majority of the Serbian people. All
over this region in places like Sarajevo, Prishtina, and here in Belgrade the war is not history,
it is part of every day life. And those wounds take a long time to heal.

Karadzic's lawyers have confirmed he will lodge an appeal against his extradition, so it now seems
he won't be moved to The Hague until at least next week.

Rafael Epstein, Lateline.

Obama assesses Middle Eastern politics first hand

Obama assesses Middle Eastern politics first hand

Broadcast: 23/07/2008

Reporter: Ben Knight

US presidential hopeful Barack Obama, is meeting with Palestinian authority chairman, Mahmoud
Abbas, as part of his Middle East foreign policy tour.


LEIGH SALES, PRESENTER: US presidential candidate Barack Obama is halfway through a flying visit to
Israel and the West Bank.

He's just wound up a meeting with the Palestinian President, Mahmoud Abbas, in Ramallah. And is
about to head to the town of Sderot, which has been hit with hundreds of missiles, fired from the
nearby Gaza strip.

It's a crucial trip for Senator Obama, which has the potential to influence thousands of votes, not
only in the American Jewish community, but among American Muslims and evangelical Christians as

Middle East correspondent Ben Knight reports.

BEN KNIGHT, REPORTER: Barack Obama won't make it to Gaza on this trip but he has plenty of
supporters there. Abdel Khaled Mansoors is one of 24 Palestinians give living in Gaza who have been
using the web to cold call American voters.

ABDEL KHALED MANSOORS, OBAMA SUPPORTER: We are a group of young people in Gaza campaigning for Mr

BEN KNIGHT: They're not part of the official Obama campaign but they want him to win.

ABDEL KHALED MANSOORS: The President of USA can change the world, not only his country.

BEN KNIGHT: Barack Obama arrived in Israel to an audience wanting some kind of idea about how
things might change if he becomes President. In large part he kept most of his comments behind
closed doors.

BARACK OBAMA, US DEMOCRATIC CANDIDATE: There aren't going to be any questions right now.

BEN KNIGHT: And straight away the business of Iran came up.

BENJAMIN NETANYAHU, ISRAELI OPPOSITION LEADER: I said to the Senator one thing; that the
determination to prevent Iran from arming itself with nuclear weapons and striking at us with its
proxies and terror attacks; that determination is joined across the political divide.

BEN KNIGHT: Barack Obama's visit is designed to reassure Israelis and American Jews that his
preference for diplomacy with Iran does not negate his support for Israel.

His trip's also been described as a photo shoot, designed to boost his foreign policy credentials
back home, and even his opponents say it's working for him.

would tell him to do the same thing.

Come to Israel, take a picture by the Western Wall, go to Sderot and show that you identify with
the citizens that have been living under a barrage of rockets for the last few years.

And hopefully those images, in lieu of a real record, will play well in the Jewish community and
the pro-Israel community in the US.

BEN KNIGHT: There was also a trip to Ramallah to meet the Palestinian President Mahmoud Abbas.
That's something Barack Obama's opponent John McCain did not do on his visit to Israel in March.

But Barack Obama has bridges to build on both sides after his speech to the American Israel lobby
last month.

BARACK OBAMA: And Jerusalem will remain the capital of Israel and it must remain undivided.

BEN KNIGHT: Palestinian leaders were outraged. But he later clarified those remarks, saying it
meant he didn't want barbed wire running through city of Jerusalem.

On this trip, Barack Obama has been saying things that will appeal to both sides.

KORY BARDASH: I believe Barack Obama presidency will be pressuring Israel much more than Senator

BEN KNIGHT: Critics say clues to his position can be found in his choice of advice others who used
to work for Bill Clinton.

KORY BARDASH: His main advisers on the Middle East are very much the Oslo crowd.

BEN KNIGHT: Palestinians put great hope in Barack Obama as someone who'll push harder than George
Bush did on issues like building settlements in the West Bank.

But for now Barack Obama is playing is very safe and giving little away on what may or may not
happen if he is elected President.

Ben Knight, Lateline.

Lloyd released on bail

Lloyd released on bail

Broadcast: 23/07/2008

Reporter: Greg Jennett

ABC reporter Peter Lloyd, has been released on bail by a Singapore court as he awaits trial on
drugs charges.


LEIGH SALES, PRESENTER: ABC reporter Peter Lloyd has tonight been released on bail by a Singapore
court as he awaits trial on drugs charges.

The 41-year-old foreign correspondent must meet strict bail conditions. He's now in the care of a
friend who posted his $45,000 surety.

Greg Jennett reports.

GREG JENNETT, REPORTER: Days of legal talks and finance arrangements were put to the test.

Peter Lloyd's lawyer, friends, and the ABC's news director had come to see whether the reporter's
week-long detention would end and to see him.

Wearing prisoner orange shirt, a thinner looking Lloyd stood for most of his bail hearing,
occasionally bowing his head.

A Singaporean friend, Mohomad Massley Bin Abl Malit, posted the $45,000 needed for bail and told
the court that the money was his, that he had known Lloyd since November and that he would stay
with him on release.

JOHN CAMERON, ABC NEWS DIRECTOR: I know he has got lots of friends and colleagues that wish him
well. And hopefully this is the start of a decent outcome for him.

GREG JENNETT: Charged with trafficking and use of amphetamines, Peter Lloyd's experience with the
Singaporean justice system has only begun.

On bail, he will have to report three times a week to the narcotics bureau and be available to the
bureau at all times in the months his case is likely to take getting to trial.

REPORTER: Will he still be on the ABC payroll?

JOHN CAMERON: Peter and I will no doubt have discussions over the next day or so once he's out
about that.

GREG JENNETT: For a man who spent most of his career in front of the cameras, Peter Lloyd was
reluctant to face them in these circumstances.

Offered the opportunity to leave through a back door, he and his entire group of supporters took it
and went quietly. The invisible departure has been offered by Singaporean authorities.

TAN JEE MING, LAWYER FOR PETER LLOYD: We need to sit down and talk about things in a bit more

GREG JENNETT: They're all due back in court at the end of week.

Greg Jennett, Lateline.