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Australian Agenda -

View in ParlView



20 JULY 2010

Subjects: Coalition cuts to services and infrastructure; Labor's Federal Election commitments;
Charter of Budget Honesty.

DAVID SPEERS: I'm joined by Labor's campaign spokesman and the Minister for Superannuation and
Financial Services, Chris Bowen. Minister, thanks for joining us.

CHRIS BOWEN: Pleasure, David.

SPEERS: Do you now acknowledge at the very least that Labor is the bigger spender heading into this

BOWEN: No, I don't. Today the Treasurer, Lindsay Tanner and I released our rules in terms of Budget
spending during this campaign. We will pay for every commitment we make over the forward estimates
and we will provide regular updates on that.

SPEERS: But the Coalition is promising to slash billions of dollars in spending. You haven't saved
a cent yet.

BOWEN: Well, no, over the last three years, we've saved $83 billion as part of our Budget
processes. That's been a very rigorous process that we've engaged in in Government.

SPEERS: But Tony Abbott's cuts are on top of that.

BOWEN: Well, a lot of these cuts are rubbery. I mean, this just shows how little the Opposition
understands economics and understands fiscal strategy.

SPEERS: What's rubbery?

BOWEN: Well, they're claiming the NBN cuts, for example, which is a capital cut. They've claimed
that as a recurrent cut. They're claiming the privatisation of Medibank, for example. So these are
one-off cuts. These are one-off cuts and they're also claiming cuts of things that we are funding
through the Minerals Resource Rent Tax.

SPEERS: But on the NBN, they're saving money by not retraining Telstra workers.

BOWEN: Well, no, but they're also cutting the whole program. Now, we say, firstly, that's wrong.
They shouldn't cut the whole program; it's very important in terms of taking Australia forward. But
it's also a capital cut. It's a one-off.

SPEERS: But you're saving interest by not spending that money.

BOWEN: Well, but it's also, they are claiming in one bucket. They are putting all their cuts in one
bucket and saying, 'These are cuts that we are making over the forward estimates.' And a lot of
these cuts are very rubbery in terms of the way that the Department of Finance and the Treasury
will consider the cuts; in terms of the impact on the Budget bottom line. So we have two problems
here. We see these cuts are wrong. They should not be cutting the NBN; they should not be cutting
GP superclinics; they should not be cutting Trades Training Centres in 1,800 schools across the
country. But also their accounting is wrong.

SPEERS: What about some of the other things they're cutting here? Community Cabinet meetings: why
do we need to keep them?

BOWEN: Well, they're actually very important, David, in terms of interacting with the community. We
get a lot out of them. We've been right across the country, from Port Macquarie to Geraldton, right
across the country going to places that, frankly, Cabinet Ministers wouldn't normally go.

SPEERS: They're also a pretty handy political tool, aren't they, for the Labor Party?

BOWEN: Well, they're held in Labor seats, they're held in Liberal seats, they're held across the
country in cities, rural areas, regional areas, and I've been to quite a few of them.

SPEERS: What's one thing, what's one Government change that's come out of a Community Cabinet

BOWEN: Well, look, often the issues that get raised there are the issues that are really important
to people.

SPEERS: Alright. If there's one, what's one thing that Cabinet learnt from a Community Cabinet
meeting that you enacted?

BOWEN: Well, David, as Human Services Minister, after the Community Cabinet meetings, I engage with
a lot of people one-on-one in terms of their interaction with Centrelink or Medicare. For example,
Bill Shorten, the Parliamentary Secretary for Disability Services, is at almost every Community
Cabinet meeting.

SPEERS: But people have other [inaudible] to deal with Government. Is there anything you learnt
that's changed?

BOWEN: There is not often that somebody, say, in Geraldton, has the opportunity to talk to the
Prime Minister of Australia and the Cabinet about their issues. We actually think it's pretty
important in terms of getting around the community. And that's a pretty small saving, frankly, in
the greater scheme of things that the Liberal Party has come up with here.

Can I say this too, David: we knew that the Liberal Party was going to cut basic services in health
and education. Today they're cutting infrastructure spending: $400 million, their biggest cut comes
out of infrastructure spending. This is a Government that ignored, when they were in office,
warnings about infrastructure spending, warnings that we weren't spending enough on infrastructure
and this was going to put upward pressure on interest rates. Today they've shown they just haven't
learnt the lesson.

SPEERS: Well, the second biggest cut they've listed is the Global Carbon Capture and Storage
Initiative that Kevin Rudd set up. Can you sit here and say we are any closer to actually capturing
carbon from a power plant, storing it under the ground as a result of this initiative?

BOWEN: Well, I guess this is unsurprising from a leader who says climate change is crap, that it
was warmer in Jesus' day and that we shouldn't have a price on carbon. This is particularly

SPEERS: Well, a lot of people will be just as sceptical about the idea of carbon capture and

BOWEN: Well, no, I think carbon capture and storage has a lot of potential. It's got a long way to
go but you need to be investing in it, governments need to be investing in it, and this is an
initiative which has been, frankly, praised around the world. Other governments have said, 'Look,
Australia is showing real leadership here in getting behind this initiative and funding this
initiative.' So I think this would be a backward step. Another example, David, of Tony Abbott
taking us backwards where Julia Gillard is proposing to take us forwards.

SPEERS: But back to the original question here. You might have concerns that these figures are
rubbery and some of the programs shouldn't be cut, but the Coalition, at the end of the day, is
promising less spending than Labor.

BOWEN: Well, we'll need to see that at the end of the campaign, David, because their spending
proposals will need to be matched against their savings proposals.

SPEERS: But at the moment they're beating you on the belt-tightening test.

BOWEN: And here's an important test: they'll need to provide all their savings and their costings
and their spending to the Secretary of the Treasury and the Department of Finance for costing under
the Charter of Budget Honesty. We're doing that, we've got a commitment to do that. They need to do
that and then we'll be able to assess, in an open and transparent way, the savings and spending
proposals of the Government compared to the Opposition.

But we have today, in a very open and transparent way, released the impact of our proposals so far
and we'll do so on a regular basis. And by the end of the campaign, our spending proposals will not
have added one cent to the Budget over the forward estimates.

SPEERS: Just finally, Chris Bowen, what did you think of Joe Hockey's crack about Paris Hilton

BOWEN: Well, I actually have a more fundamental problem with it. My more fundamental problem is
that he either doesn't understand or chooses to ignore that we are returning to surplus in three
years' time and three years ahead of time, and before any other major advanced economy. That's my
more fundamental issue.

SPEERS: He's trying to get there faster, isn't he?

BOWEN: Well, no he's not. Well, he's not. But he'll have to deal with how he explained it. But my
more fundamental issue is that he's got the basic fundamentals of economics wrong, not how he
communicates it.

SPEERS: Alright, Chris Bowen, thank you very much.

BOWEN: Nice to talk to you, David.