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Early Agenda -

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Kieran Gilbert: Good morning and welcome to AM Agenda. The Prime Minister has given his clearest
endorsement yet that Julia Gillard is his heir apparent as leader. This morning on the program we
are going to look at that and the various challenges that face the new look Labor frontbench with
our Wednesday panel Scott Morrison, Liberal frontbencher who joins us from Sydney. Good morning,
Scott.

Scott Morrison: Good morning, Kieran.

Kieran Gilbert: And here with me in the Canberra studio is the new Labor Parliamentary Secretary
for Employment, Jason Clare. Jason, first of all, you're one of the members of the new look
frontbench team, congratulations.

Jason Clare: yeah, thanks very much.

Kieran Gilbert: That happened, probably happened sooner than you thought it might.

Jason Clare: Absolutely, I was shocked when I got that phone call from the Prime Minister on the
weekend, but very excited, too. This is a big responsibility; Parliamentary Secretary for
Employment puts me at the centre of the most important issue facing the country.

Kieran Gilbert: Well, employment and infrastructure will be front and centre of course of the next
election campaign and I suppose you've been given quite a responsibility there within that
portfolio which is overseen by Julia Gillard.

Jason Clare: Well, forget the next election campaign, it's the most important priority facing the
country, facing the economy. For that matter, it's the most important issue facing every government
around the world. Just look at what happened in America last week. They've now got unemployment
figures, the highest in 25 years. It's a big problem around the world. It's a massive challenge for
this government. That's why I've got to be focused, make the top priority unemployment.

Kieran Gilbert: We've seen some mixed data out this week, Jason. The job ads yesterday for the 13th
month in a row, they are down. The business sentiment was up though. It seems to be some counter
intuitive sort of data around the place. We've got the jobs numbers out this Thursday, would you
expect those to be up?

Jason Clare: Well, this all just shows just how complex it is managing an economy during a time of
a global recession, makes it very very difficult. The figures that we've seen out over the last few
weeks shows that the efforts the government has taken to stimulate the economy are having results.
They are bearing fruit. You are seeing retail figures up, you are seeing housing developments up.
You also saw positive results in the national accounts last week but there is still a long road to
hoe. The unemployment figures that came out, what, a month ago surprised everybody. No one expected
to see that drop. So everybody when you have a look at the Treasury forecasts for example,
projecting that unemployment will go up, that it needs to be at the centre of every thing
government does, the focus has got to be keeping people in their jobs, protecting jobs.

Kieran Gilbert: So you'd expect this Thursday then the unemployment rate to rise? I mean, because
that was seen by a lot of people as an anomaly that last month's figure.

Jason Clare: It certainly was, you know. People were surprised, the market was surprised. The
forecasts are that unemployment is going to go up over the next 12 months so I'm not going to
pre-empt what's going to happen on Thursday but what we do know is unemployment is got to be the
top priority of government. It's got to be the top priority of everything that we do, marshalling
the forces of economy to keep people at work.

Kieran Gilbert: Scott Morrison, it does seem the Prime Minister has moved to shore up his defence
in that area, doesn't it from that reshuffle, trying to put more and more focus on the issue and I
suppose providing support for Julia Gillard in that area?

Scott Morrison: Well, first of all, let me congratulate Jason on his elevation. We had a chance to
chat the other night and it's, you know, due recognition for Jason but I think more broadly when we
are looking at the reshuffle, you know, the Prime Minister's said that there's been no factional
influence in this. Well, if that's the case, it's immaculate factional conception I think in the
way this has all played out. That's not to say that there aren't individuals who have merit but I
think it's absurd for the Prime Minister to suggest that he hasn't taken those sorts of factional
issues into consideration as he's made these decisions. More broadly on the issue of Julia Gillard
though, I mean this has been the issue that I think has been looming behind the Prime Minister for
some time, in that it was a marriage of convenience in opposition. It's working its way through in
government, but I was interested last night to hear Mark Arbib, one of the other more recently
elevated members of the government when he was talking about the Prime Minister's inner circle and
he failed to even mention the Treasurer of all people. So in the middle of what they say is the
biggest global recession of all time since the Depression but yet the Treasurer is not even part of
the Prime Minister's inner circle. But getting back to the figures, what we are seeing in the
figures last week. I noticed Jason didn't even draw attention to the export performance which was
seven times, seven times the contribution of what the increase in household consumption was. I mean
last figures as we discussed-last week's figures as we discussed last week was all about exports
and it was all about a private sector not in a retreat but a private sector that was actually
advancing and was the way out of this down turn for Australia.

Kieran Gilbert: Jason, on the issue of Julia Gillard though that Scott touched on there. I want to
ask you about it. The Prime Minister gave his clearest indication yet that she is his anointed
successor saying anytime in the future she would be very very hard to beat. Is this just stating
what we all assume?

Jason Clare: It's stating the obvious. She's a first class performer and you know, as you know
she's first class person as well. The Liberal Party would cut off their right arm to have someone
like Julia Gillard on their side. They just don't have someone that good.

Scott Morrison: No, no, Jason. Sorry, mate, can't agree with you there. She's all yours. She's all
yours.

Jason Clare: Mate, you would cut off your right arm to have someone of the quality of Julia Gillard
on your side and just don't have one.

Scott Morrison: We have them in spades, in spades and more. You can keep her.

Jason Clare: Well, name one, name one, mate. I'd like to know where they are.

Scott Morrison: Julie Bishop, number one, Julie Bishop, number one.

Jason Clare: Well, I'll take Julia Gillard over Julie Bishop any day of the week.

Scott Morrison: You're welcome.

Jason Clare: This person is a first class talent and the Prime Minister was stating the obvious
there.

Kieran Gilbert: Well, stating the obvious that she is the heir apparent.

Scott Morrison: Look, this sort of debunks all of this nonsense debate about factions, you know.
You pick the best person for the job whether it's the person that leads the country or whether it's
the person that steps up into a portfolio or Parliamentary Secretary.

Kieran Gilbert: It only debunks it if she gets there. Do you think that the factions, I mean, would
they allow her to take the top job eventually.

Jason Clare: I think the party is big enough and mature enough to know that you want the best
person in the job, you want the best person in the job.

Scott Morrison: Well, Kieran I think the Labor Party is getting well ahead of themselves here,
particularly the Prime Minister to be going around the country presumptuously declaring successors
to the role of the Prime Minister is just absurd. I mean, this is a government that has already
sort of counting its chickens before they're hatched. You can't go around appointing successors, I
mean the Australian people decide who the Prime Minister's going to be and they'll decide that at
the next election. It won't be Kevin Rudd, it won't be Julia Gillard or any of the factional bosses
that sit around tables in the Labor Party, it'd be the Australian people.

Jason Clare: That's fair enough, Scott. Let's get this in perspective. Kevin was asked a question
by David on Sky yesterday about this and he'd, if he taken the opposite approach and he said he'd,
oh look, we've got to wait and see then he'd accused of criticising Julia Gillard. All Kevin was
doing was responding to a question by David Speers and I think he was just stating the obvious that
this person, Julia Gillard is an A-grade talent, someone that the Liberal Party would cut off their
right arm if they are being honest to themselves.

Scott Morrison: You assert it all you like, mate. It won't make it true.

Kieran Gilbert: I mean, the aversion to anointing a successor, wasn't that the problem that cost
you government in the first place?

Scott Morrison: No, I don't believe it was so at all. I mean, we've always taken the view that, you
know, there's a party room in the Liberal Party and the Australian people make the ultimate
decision on these things and I think that's the appropriate and democratic way to do this so I
think Australians wince a bit when it comes to politicians going around and appointing successors.
I mean, even at a local level, we've noticed in by-elections for example when long running
independents, when they retire, have tried to appoint a successor. I mean the Australian people
react I think very, you know, aggressively towards that. People trying to behave like the sun king
and extent their rule off into the eons, I mean, it's just not the Australian way to do things. I
mean, the Australian people will make their decisions about people at the time and I think that's
the way it should be always handled.

Jason Clare: Yeah, look, again, there was none of this appointment of successors yesterday. I think
Scott is taking this a little bit too far. All Kevin was doing was answering a question by David
and I think he gave a fair and honest answer.

Kieran Gilbert: Okay, I want to look at another issue now and that is the prospect that this
frontbench, this reshuffle is now the election team that you're going to be put on an election
footing. Phil Coorey in the Herald this morning that-Sydney Morning Herald is reporting that you
are going to be put on a foot, an election footing as of November this year. Jason, would you be
surprised if there was an election before Christmas?

Jason Clare: I don't think anyone in the government is talking about an early election. Remember
where all this came from. Malcolm Turnbull is the guy that's talking about an early election.

Scott Morrison: No, no.

Jason Clare: I know the media like this idea. There's nothing sexier around this place than talk of
an early election or talk of a leadership challenge. I know that there could be a leadership
challenge coming up in the Liberal Party in the next few months ...

Scott Morrison: Oh, Jason.

Jason Clare: ... but we are not talking about an early election in the next few months.

Scott Morrison: You are just trying to win your bet.

Jason Clare: Well, mate. There's $50 riding there, that's 150, isn't it?

Scott Morrison: I should've had a bet on Fitzgibbon. We should've had a bet on that, I'd be way
ahead by now.

Jason Clare: Well, we've only got to wait a couple of more weeks, mate. I think.

Scott Morrison: Not at all.

Jason Clare: That Higgins preselection thing.

Kieran Gilbert: For those who missed that edition of AM Agenda, Jason. You put $50, wasn't it, on
the table that Malcolm Turnbull would not be leader at the next election?

Scott Morrison: And I tripled it, and I tripled it. That's how confident he was.

Jason Clare: That's right, Higgins preselection is only a couple of weeks away so we'll know pretty
soon if Peter Costello's hanging around. He's written an article in the Sydney Morning Herald today
there's not too many backbenchers from Victoria who write articles in the Sydney Morning Herald.

Kieran Gilbert: But he's bagging your-I mean, he was hardly sort of undermining his leadership-he
was bagging your side.

Jason Clare: Well, it's all about preparing for leadership. That old swamp fox is lurking, he's
ready to come back. If he preselects, you know he wants to be leader. There's going to be a
leadership challenge and I suspect that it'll be sooner rather than later.

Kieran Gilbert: I want to stay on this issue of the prospects of when the election timing will be.
Mark Arbib was on the ABC last night, Scott has already alluded to it. I want to play a little bit
of Mark Arbib on Lateline last night:

Mark Arbib: I would actually be advising not to go to an election, I think we've got a stimulus
package that is going to roll out over the next 18 months and there are projects underway now that
need time to get moving. We've got construction workers on sites now so I think we should go long
and get that work done so we can go to the electorate and say this is what we have done to bolster
the country, to cushion the country from the global recession.

Kieran Gilbert: So the Employment Participation Minister, your colleague now in that portfolio
saying that he wants to enjoy the fruits of the investment but isn't it true that you also-it'd be
handy to avoid handing down another Budget in this economic climate?

Jason Clare: We are elected to govern. The biggest challenge confronting the country is the global
recession and how it's hitting our shores. The people who elected us expect us to be focused on
doing that, keeping people in their jobs and that doesn't mean going to an early election. It means
focusing on keeping people at work and that's what Mark was talking about, that's what my job now
is, that's what the Prime Minister's job is, focused on the job at hand. As I said before, there's
only one person talking about an early election and it's Malcolm Turnbull. It's not the government.

Scott Morrison: No, no. Look, I've been-I've been around Mark Arbib for some time. He was the
general secretary of the Labor Party when I was state director of the Liberal Party and there's one
thing I know about Mark is when he's saying one thing like that, he's meaning something completely
different. He's the master of talking up expectations or talking them down to suit whatever the
political agenda is that he might be running. Mark's an artist at these sorts of things so if you
can hear Mark Arbib saying, oh no, I wouldn't be talking up an election or going to an election,
you can be pretty assured that Mark's private thoughts are something very different. The government
...

Kieran Gilbert: So are you ready for it Scott? I mean are the Liberals, would the Liberals be ready
for it? You're divided on a few issues, but, you know, would you be up to running a campaign? I
mean, climate change is the one that comes to mind where there're some difficulties for your
leader.

Scott Morrison: Well, I thought there was a very interesting poll that came out this week which
showed-I think it was on your program last night-which showed that Australians would be
increasingly sceptical of a government that went to an early election on the basis of trying to ram
through a bill which today we see Bluescope and others saying should be delayed till after
Copenhagen. And the Coalition is making, I think, the very sound and common sense argument that we
should be waiting to see what the American scheme will look like and the Copenhagen meeting
outcomes are. So I think Australians are very alert to the Prime Minister's motives on this issue
and I think they would see very cynically any attempt for him to scoot off to an early election on
the pretext of that vote. We'll fight the election whenever it's on and it's for the Prime Minister
to call it and I think the Australians would be very very tuned to any sort of opportunistic
behaviour by the Prime Minister obviously being egged on by Mark and others, you know, who've been
down this path many times.

Kieran Gilbert: Okay, we are going to take a quick break. Stay with us here on AM Agenda.

Kieran Gilbert: Welcome back to AM Agenda. With me in Sydney is the Liberal frontbencher Scott
Morrison. Here in Canberra, the Labor frontbencher Jason Clare. Jason, the government's scrapped
its solar panel rebate abruptly last night, Peter Garrett. It was meant to go for another three
weeks. It's been popular but gees, it's been chaotic as well.

Jason Clare: It's been very popular. I think there's about 60 000 installations that are in the
pipeline now. I was having a look at some information this morning.

Kieran Gilbert: Haven't given the industry much of a heads-up. It was cancelled yesterday by five
o'clock last night. Done.

Jason Clare: To be fair, industry has known since December that this was going to conclude in the
middle of the year and it would convert from one scheme to another.

Scott Morrison: But not on the June the Ninth, mate.

Jason Clare: It's been that successful as I said, you've got 60 000 installations that are now in
the pipeline. The industry is flat out. Apparently it takes a week to do a thousand installations,
so there is now work for the industry flat out for the next 12 months. That is why the decision's
been made. It's now time to move to the next scheme. It's got to the point actually where these
solar installations are that cheap that with the rebate, it's actually free in many circumstances
and industry's been advertising free installation, so it's been a success. It's been quite a big
success. You'll remember a couple of months ago that Greg Hunt jumped out of a plane saying that
the means testing of this scheme was going to mean that the industry would collapse. Well, Greg's
now got to find a way to suck himself back up into the plane because it didn't collapse, it was a
great success. 60 000 installations on the go and that'll feed jobs in the industry for the next 12
months.

Kieran Gilbert: More of a bungee jump, maybe? Scott Morrison, what are your thoughts? I mean it
does show that it's been popular, it has been a bit chaotic in the sense that it was scrapped
abruptly last night three weeks before it was due to, but ...

Scott Morrison: Yes, that's true.

Kieran Gilbert: has it been a victim of its own success?

Scott Morrison: Well, I mean, this is a scheme the Coalition actually introduced in our last year
in government. The government put a means test on it a year ago and the scheme has been very
successful and very popular, but I'll say this, this is a government whose Budget's out of control.
That's what happened in the last 24 hours. They basically canned this scheme 20 days ahead of time
because their budget was running out of control, so on the one hand you've got this issue with the
solar rebates where they're having to reel it in, and on the other case I highlighted a case on the
weekend where the First Home Saver Accounts are 96 per cent undersubscribed and the government
failed to bring any savings measures forward on that scheme and there's $700 million worth of
savings over the next three years that could be held by just capping that scheme at around 10 per
cent of the projected taker, so this a government that-whose Budget has completely gone all over
the place. Their ministers aren't on top on the programs that they are running so they are either
massively overspending, or massively underspending, and not reconciling these things around the
Budget table and that's how you end up with massive debts and deficits and spending being out of
control. They government has to get control of its own budget and the solar rebate fiasco is just
another example of it.

Kieran Gilbert: Jason, on another issue, the stoush with the unions at the moment. The government
seems to be quite happy to have this fight with unions on various issues. The ACTU pushing for a
second wave of reform and calling for the Building and Construction Commission to be scrapped, but
it seems to me watching the Prime Minister and the government more broadly that you're more than
happy to have a fight, that it's a good image for Labor to be saying, yeah, we are standing up to
the unions.

Jason Clare: Well, I think let's get it in perspective. The government has done a lot for working
people over the last 12 to 18 months. We've got rid of WorkChoices; we got rid of AWAs; introducing
a paid parental leave scheme; improving childcare rebates. Doing a lot that are going to help
working people, the type of people the union movement represents and on most things, the Labor
Party and the union movement are going to agree about things that we can do to help working people,
but you are not going to agree on everything. Just like the business community and the Liberal
Party aren't going to agree on everything. You know, there's a fight going on between the business
community and the Liberal Party at the moment about the Australian business investment partnership
and about emissions trading, so just as there're going to be disagreements between business and the
Liberal Party, you are going to find disagreements from time to time between the union movement and
the Labor Party.

Kieran Gilbert: Scott, this does show that the government is happy to, you know, clash with the
unions from time to time?

Scott Morrison: Well, no, I don't, Kieran. I think this is a phoney war frankly. I mean the
government's bold and brave claim here is that they are going to hold out on the ABCC for another
six months or 12 months. I mean the Coalition policy was to implement this commission. It was came
out of the Cole Royal Commission which found, you know, wide spread thuggery and intimidation in
the building industry particularly in Victoria and we believe it should be there. I mean, they want
to pick a fight for, what, another six months? That's their big brave, bold standing up to the
unions? That they're just going to roll over in 12 months time, or six months time. I think it's a
phoney fight. I don't think the government is in this at all for the long haul.

Kieran Gilbert: Okay. Scott, I just want-we are almost out of time. I want to get your view, both
of your views on the issue around Thérèse Rein and the photographs of her whilst she was having a
workout in the gym. Scott, first, your reaction, did you think the Prime Minister was reasonable
in, you know, having a go at this magazine for taking these photographs without his wife's
permission?

Scott Morrison: Well, look. I think all of us, you know, my own wife and others, we are very
protective of our own families as we should be. I think that's the-that's very, a very human thing
to do. I mean, we live in this, as public figures, this world. That doesn't mean our spouses need
to be subject to that same sort level of scrutiny and I think we're always very protective of our
families. You know, I'm always going to support someone who's standing up for their family in
situation such as this, and good on her for taking her son to Kilimanjaro. I think that's a great
initiative. I mean, Jason and I have just done a similar trek in Kokoda. These are great
experiences to share with young people and I think that's a great thing for her to be doing.

Kieran Gilbert: Jason, the magazine was unrepentant, it said that it was paying tribute to her and
congratulating her on her improved fitness and so on.

Jason Clare: Well, if they truly meant that they could have actually asked her before they took the
photographs. You know, politicians are fair game, if they want to take photos of Scott and I in the
gym then fair enough, they're pretty ugly photographs I've got to tell you, no one would want to
see them.

Scott Morrison: After nine o'clock, after nine o'clock viewing I think.

Jason Clare: Yeah, respect the privacy of partners and children. America's got this right. In
America you've not seen the photographs of the Obama children. They are respecting their privacy. I
think we can do better than that in Australia, and Malcolm Turnbull got it right when he reflected
the comments of the Prime Minister that this is not on, you know, we are better than that, the
media's better than that.

Kieran Gilbert: So in terms of this whole sort of focus on her achievements in the gym, it does
seem quite odd that, you know, she's been a successful business person, achieved a hell of a lot
outside of that and yet such a peripheral sort of thing to be-to have people, you know, reporting
on, and interested in.

Jason Clare: Yeah, I don't know anyone would be interested in that anyway. As you said she's an
incredibly successful person in her own right.

Scott Morrison: True.

Jason Clare: She should be acclaimed for that as well as for the work she does for charity, and as
Scott's said, climbing Kilimanjaro, we just got back from six and half days on the Kokoda Track.
That's at altitude, that's even harder. This is a real challenge and I wish her all the best of
luck.

Kieran Gilbert: Well, okay, gentlemen. Thanks for your time.