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Meet The Press -

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DISCUSSIONS ABOUT CUTS TO GOVERNMENT SPENDING, HOSPITAL SPENDING, LIBERAL LEADERSHIP, 2020 SUMMIT.

MEET THE PRESS PRESENTER PAUL BONGIORNO: Hello and welcome to Meet the Press. Parliament proved a
much healthier forum for the federal Opposition during the week. Brendan Nelson, buffeted by
abysmal opinion polls, fired up to grab the Government's carers' bonus confusion to ram home some
telling blows and score a win.

OPPOSITION LEADER BRENDAN NELSON (Tuesday): And without her, as he said to me, "Brendan, I would be
dead, D-E-A-D." John Howard was the quiet achiever - Kevin Rudd has turned out to be the quiet
deceiver.

PM KEVIN RUDD (Wednesday): When it comes to carers and pensioners bonuses they will not be a single
dollar worse off, not a single dollar worse off when it comes to this budget. And consistent with
normal practice those payments will be made in the course of this financial year.

PAUL BONGIORNO: Shadow Health Minister and Manager of Opposition Business Joe Hockey is a guest.
And later, as preparations for the 2020 summit gather pace, we speak with one of the steering
committee's leaders, former Liberal Minister Warwick Smith. But first - what the nation's press is
reporting this Sunday March 16. The 'Sunday Times' reports "May budget cuts target the rich."
Treasurer Wayne Swan says high income earners would be forced to share more of the burden of budget
spending cuts. The 'Sunday Age' leads with "Japan fury over Rudd snub." The Prime Minister has
provoked a potentially costly diplomatic row with our largest export market by leaving Tokyo off
the itinerary of his first world tour. The Japanese are furious that Beijing has been given
preference. The 'Sunday Mail' in Brisbane has "Campbell leads Liberals to power." Lord Mayor
Campbell Newman has taken full control of Brisbane City Council in elections yesterday which
cements his position as the most senior elected Liberal in the country. The Sunday 'Herald Sun' has
"Peter Garrett: I was wrong." Environment Minister Peter Garrett has admitted the Government is
considering a check-out charge on plastic shopping bags after denying such a charge was under
review. The 'Sunday Telegraph' leads with "Girlfriend basher Wayne Carey confesses, I'm addicted to
cocaine." The paper says the disgraced football star sold his grubby tale to 'New Idea' for
$180,000. While still adjusting to a shattering election loss three months ago, the Coalition has
come out fighting in parliament, using controversial tactics to force a Government backdown on
Friday sitting days, and more conventionally, shaming Kevin Rudd into assuring carers their annual
bonus payments will continue. Welcome back to the program - in a new guise - Joe Hockey.

SHADOW HEALTH MINISTER JOE HOCKEY: Great to be here.

PAUL BONGIORNO: Mr Hockey, some good news for Liberals after the local Government elections in
Queensland.

JOE HOCKEY: Well, it was a very strong result for the Liberal Party, particularly for Campbell
Newman. Great results in Brisbane, in the Gold Coast and also the Labor Party has been wiped out of
the Council in Townsville for the first time in a very long time. So the Liberal Party has
performed strongly on the ground in Queensland.

PAUL BONGIORNO: If the Liberals can do it at a local council level, why can they do it at a State
and Federal level?

JOE HOCKEY: Well, we can. It is about rebuilding our relationship with the community. In many ways
this may become the emblematic moment that the Liberal Party has reconnected with the community and
built up a core base of support for better Government and stronger values in Government.

PAUL BONGIORNO: Just going to Federal issues now. The carers' bonus payments widely seen as a
victory for the Opposition, forcing the Government to declare its hand. Were you surprised that
Kevin Rudd came out in the way that he did?

JOE HOCKEY: Well, not really. Because I don't really believe that the Government knows what it is
doing, and nor do the Australian people, given that consumer confidence is now at a 15-year low.
Business confidence is at record lows, and a lot of Australians, according to Westpac and Census
surveys are indicating that they're very concerned about the direction the country is heading. At
the same time, Kevin Rudd is claiming to be a fiscal Conservative. He's finding that it's very
difficult to be in government and be compassionate. So, he's trying to walk both sides of the
street. He told Australians that he's a fiscal conservative, and now he finds out that when you're
in Government, if you want to be a fiscal conservative, there are hard decisions.

PAUL BONGIORNO: Aren't you trying to have it both ways too? Do you accept that inflation is a
problem and that the Government does need to cut spending?

JOE HOCKEY: Cutting spending is not going to have a dramatic effect on inflationary pressures
unless it is a dramatic cut in Government spending.

PAUL BONGIORNO: So, the Opposition will play opportunistic politics with every cut that it does?

JOE HOCKEY: Well, we've got an obligation to point out where Kevin Rudd is being a hypocrite, and
where his government says one thing to the electorate and does another thing. Bear in mind, Paul,
when the Labor Party was last in government, inflation was left at 5%. Now it is 3.5%, and they're
saying that there is an inflation crisis.

PAUL BONGIORNO: The Reserve Bank is saying it too.

JOE HOCKEY: No, the Reserve Bank isn't there is an inflation crisis.

PAUL BONGIORNO: They keep putting up interest rates.

JOE HOCKEY: They put up interest rates, but there's a strong argument that the Reserve Bank has
gone too far, particularly given that the cost of funds to the banks now are so high that the banks
are increasing their interest rates on top of the Reserve's increases in interest rates. So, Mr
Rudd left Australians with a clear impression that he was providing new leadership with fresh
ideas. Well, there's no new leadership in slugging carers, and there's no fresh ideas in having
committee after committee after committee set up trying to get ideas from the community...

PAUL BONGIORNO: Will the Federal Opposition be helpful and perhaps invest in its own credibility by
showing where some cuts should be made?

JOE HOCKEY: Well, you know what, we've just been through 13 years of Government. There was no
shortage of people providing us with advice. What we're doing is saying, OK Mr Rudd, you said to
Australia that you were providing leadership. Now, do it, mate. I don't really think he and Wayne
Swan know what they're doing to the Australian people.

PAUL BONGIORNO: On Thursday, Malcolm Turnbull tried to suspend standing orders to blame the
Government for inflation. Not surprisingly, the Government saw it more aimed at outdoing Brendan
Nelson.

SHADOW TREASURER MALCOLM TURNBULL (Thursday): I seek leave to move that this House condemns the
Government's continued efforts to misrepresent Australia's economic circumstances, and in so doing,
are exacerbating our nation's economic challenges.

TRANSPORT MINISTER ANTHONY ALBANESE (Thursday): This is a job application for the position of
Leader of the Opposition, using or abusing the Parliament and the House of Representatives to do
just that.

PAUL BONGIORNO: Well, the 'Wentworth Times', the local paper in the electorate of Malcolm Turnbull,
agrees with Anthony Albanese there. It had a front page last week saying that it is only a matter
of time before Mr Turnbull is leader.

JOE HOCKEY: You know what, Paul? I know there's a feeding frenzy on with some in the media right
now. But let me say this - Brendan Nelson is doing an extremely good job in difficult
circumstances. He's had a sensational week for carers and pensioners this week by forcing Kevin
Rudd to change the policy. Brendan Nelson is a compassionate, dedicated, hard-working leader and
he'll continue to do so. And everyone can work on the speculation, but let me promise you - we are
doing the job that a good Opposition should do.

PAUL BONGIORNO: You can't deny that Mr Turnbull is an ambitious man.

JOE HOCKEY: Well, everyone is ambitious in politics, Paul, a bit like the media. (Laughs)
Everyone's a little bit ambitious.

PAUL BONGIORNO: Brendan Nelson had a good week. Malcolm Turnbull took a hit, didn't he? Everyone

JOE HOCKEY: tries to have a good week in politics. We all aspire to do that. Sometimes it's swings
and roundabouts, but there's a lot of people in politics with a healthy respect for themselves.
We're all guilty of that from time to time, but we're determined to be a credible, effective
Opposition. When we return with the panel - where now for Coalition policy on hospitals? And the
cunning stunt of the week goes to Family First Senator Steve Fielding. He arrived for work dressed
as a bottle.

FAMILY FIRST SENATOR STEVE FIELDING: There's a message in this bottle that I'm no longer trash. I'm
cash.

PAUL BONGIORNO: You're on Meet the Press with Shadow Health Minister, Joe Hockey. Welcome to our
panel, Eleanor Hall from the World Today on ABC Radio. And Glenn Milne from the 'Sunday Telegraph'.
On Wednesday, Health Minister Nicola Roxon launched the first meeting of the Health and Hospital
Reform Commission. The Government has set itself the task of sorting out Australia's hospital
crisis within three years and the Commission is expected to come up with guidelines on how to do
it. An interim report is expected in April and a final report six months later.

HEALTH MINISTER NICOLA ROXON (Wednesday): Today marks a really great day for the future of our
health and hospital system. The work of the Commission is, they have got a big job in front of
them. We are looking to them to help us design a health system for the modern Australia that we all
need to live in.

ELEANOR HALL, ABC RADIO: Joe Hockey, Labor is clearly out to redesign the hospital system. The
policy you took to the last election was the take over of the Mersey hospital. That doesn't look
like good policy. It's now costing $20 million more a year than you said it would. Are you going to
redesign your policy from the ground up too?

JOE HOCKEY: Eleanor, all of the policies are up for review. We would be mad not to do so, to look
at the policies. But I do note that the National Health and Hospital Reform Commission set up by
the Minister has been given a brief that has been changing over the course of the last few weeks.
You've got the Minister negotiating a new health agreement with the States over the next two
months, and yet, this Health Reform Commission is expected to give her advice on how to do it. It
has only just been set up. What we've said is, we want the States and the Commonwealth to delay any
further agreement until this national body provides full and frank advice, which surely can't be
done over a 2-month period.

ELEANOR HALL: But on your policy, do you agree that the takeover of a hospital by the Federal
Government is not workable? That the Mersey system really isn't working at all?

JOE HOCKEY: We needed to provide a safety net when the Labor State Government walked away, and I do
note that even now, State Labor is trying to cream the money away from the Mersey and put it into
other projects in Tasmania - which is unacceptable. We stand by our Mersey proposal, because we
believe it was in the best interest of the local community.

ELEANOR HALL: Why is it costing $20 million a year more than you said it would?

JOE HOCKEY: You would need to ask the State Labor Government why that is the case. I don't have the
answer. But, what I do know is that the Labor Party talks big on hospitals but delivers very
little.

GLENN MILNE, 'SUNDAY TELEGRAPH': Mr Hockey, you've managed to shame Mr Rudd in keeping the care and
pensioner's bonuses. But, do you think that the health budget should be quarantined from any
spending cuts in the forthcoming budget?

JOE HOCKEY: I think that the health budget should be expanded. They will need to spend more to meet
Mr Rudd's promises to the Australian electorate, particularly in relation to hospitals. Now, we put
aside an extra $18 billion for hospitals as a contingency reserve for the negotiations between the
Commonwealth and the States. So, we were going to put more money into healthcare for Australians.
If the Government takes an axe to healthcare for Australians, Australians will feel it at the
hospitals and at their local GP.

GLENN MILNE: It sounds to me like you're saying that more Government spending and the Government's
argument is that that puts a Bunsen burner on inflation.

JOE HOCKEY: There are areas where you can always save money, no doubt about that, and particularly
when a Government spends $250 billion a year. This is the dilemma that Kevin Rudd has. On the one
hand, he's a fiscal conservative, and on the other hand, he's trying to tell people that he's
compassionate.

GLENN MILNE: Well, on that point about fiscal conservatism. Wayne Swan now says that he'll target
the wealthy in the budget. What's wrong with means testing things like the baby bonus, the Medicare
safety net? Why should millionaires get the benefits?

JOE HOCKEY: Well, that's the fringe of expenditure, Glenn. If you're going to have significant cut
backs in Government expenditure, the only way to do that is to hit middle Australia. Kevin Rudd
promised that petrol prices, grocery prices and household costs would be capped or come down under
Labor. He can't have it both ways. There are huge pressures on the family budget. The only way to
address that is to provide some relief for middle Australia. You can't have a smaller budget
expenditure, and at the same time, provide more money for middle Australia.

ELEANOR HALL: Joe Hockey, we've been hearing a series of horrific stories about abusive patients by
doctors across several States. Is it time we had a national doctor registration system?

JOE HOCKEY: Of course it is. It is time and we had started negotiations with the States on setting
up a national register of doctors, but the fundamental point is that there are State medical boards
who are responsible for policing their own doctors and for accepting complaints from the community
investigating them. Now, if there a systemic problem, the minister needs to have these problems
investigate immediately. It's not good enough to have the so-called 'Butcher of Bega' or other
reports of doctors who have been reported on in numerous occasions to the medical boards and no
suggested action has occurred.

ELEANOR HALL: Why weren't you able to get the national register up?

JOE HOCKEY: One of challenges is dealing with the States. They are extremely parochial about
protecting their own interests, but there was also some resistance from the medical professions who
quite fairly, I suppose, stated that having a bureaucratic body based in Canberra means it is
further away from the doctors who are complained about, than having them based in the State
capital.

GLENN MILNE: Just off your portfolio for a moment, Mr Hockey, the TWU reports, that's the Transport
Workers Union, reports corruption inside that union this morning. What should be done?

JOE HOCKEY: There should be a full independent inquiry into the Transport Workers Union and its
relationship with the Labor Party. And the Labor Party at a Federal and a State level has to
coordinate the inquiry so that the TWU can't play off State versus Federal jurisdiction. Quite
clearly, these are very alarming reports about misappropriation of funds and also about the
backdoor funding of the Labor Party, with perhaps even the allegations of extortion not being
properly investigated to date. So, I would say that you need to have a full independent inquiry.

GLENN MILNE: Who should run it?

JOE HOCKEY: It should be up to an independent judicial officer, or someone else who certainly runs
a transparent inquiry, so that the full disclosure of the Transport Workers Union just links with
the Labor Party are disclosed.

GLENN MILNE: With wall-to-wall Labor Governments, it's not going to happen, is it?

JOE HOCKEY: This is one of the downsides of wall-to-wall Labor. You can't have inquiries by
Government agencies because ultimately they may not properly reflect the full transparency that you
would expect from an independent inquiry.

PAUL BONGIORNO: Just before we go, the 2020 Summit, I think it was last week you described it as
something of a joke. Is that still your view? Do you see any good that could come out of the
summit?

JOE HOCKEY: Well, hopefully you can always get good out of a summit, but Paul, Kevin Rudd went to
the election four months ago saying he was providing new leadership and fresh ideas. In the first
four months, we've had a plethora of committees and advisory bodies set up. Why are the new ideas?
Where are the fresh ideas? He was meant to provide new leadership? He's now called 1,000 people to
Canberra to give him advice.

PAUL BONGIORNO: Did Brendan Nelson put his hand up too early?

JOE HOCKEY: No, Brendan Nelson did the right thing. The Opposition needs to be constructive, but I
can tell you, if it is difficult to get any solid recommendations out of a committee of three,
bringing 1,000 people to Canberra for a weekend is a tough ask.

PAUL BONGIORNO: Thank you very much for being with us today, Joe Hockey. After the break, we speak
with one of the best and brightest helping to organise the Prime Minister's brainstorming summit
for the future. In the meantime, the Nicholson and the gang from the Robbery figures from 'The
Australian' newspaper's website have gone to 'New Idea''s role in outing Prince Harry's tour of
duty in Afghanistan.

PRINCE CHARLES CHARACTER: You know, people are such snobs about 'New Idea'. I think it is jolly
interesting. I say, look at all of the stuff on Afghanistan of all places. What, did you know Harry
is in Afghanistan? Bugger me, I knew I hadn't seen him at polo for a while.

(DOORBELL RINGS) Oh, Harry, I thought you were fighting the fuzzy woozies somewhere. How come
you're back so soon? Get someone pregnant? Anyway, good to see you in one piece.

(MACHINEGUN FIRES)

OSAMA BIN LADEN: Curses, curses, curses! Prince Harry is here like a craven dog within the new
target. Get me the intelligence support. That's it, Paris Hilton, she must die.

CAMEL: Why, because she's a western pig and a B-grade porn star?

OSAMA BIN ALDEN: No, she stole Sophie Monk's boyfriend. The cow!

PAUL BONGIORNO: There were reports during the week that more than 10,000 Australians have put their
hands up to join Kevin Rudd at next month's Weekend of Future Thinking. The Opposition Leader is on
board, but despite early enthusiasm is becoming a tad sceptical.

BRENDAN NELSON: 1,000 people going to Canberra for a weekend, you and I both know that's going to
be a dog's breakfast in terms of how you run it and how do you get the outcomes. How do you get
people to make a sufficient contribution?

PAUL BONGIORNO: One man who already has a ticket to the summit is former Howard Government
minister, Warwick Smith who will coordinate the discussion on the digital economy and the future of
the cities. Good morning and welcome to the program.

FORMER GOVERNMENT MINISTER WARWICK SMITH: Good morning, Paul.

PAUL BONGIORNO: Are you disappointed with Brendan Nelson saying it will be a dog's breakfast? Joe
Hockey is a bit sceptical although eh backed off a bit this morning.

WARWICK SMITH: I think that their task of course is to be an Opposition and test governments and we
all know that the best government comes from strong opposition, so you would expect them to focus
on being supportive and be supportive where they need to be and critical where they need to be. But
what's trying to be achieved here is creating a national ideas bank, pulling together across the
political divide and digging deep into the community in a diversified way with a range of people to
give ideas to a broad range of topics to a new Government and that will probably be quite
successful in its intent. Now, the logistics certainly will be difficult and there are good people
who will be working with that, and Australia has exemplified itself in running big events -
Olympics, Commonwealth Games and so on, so I know that we'll be bale to achieve this. But the
fundamental point is that getting good ideas and reaching right across the community I think is
constructive and it's worth the try.

GLENN MILNE: You've had broad commercial and political experience. What specific ideas will you be
bringing to the summit?

WARWICK SMITH: The area that I'll be focusing on is a key area, basically the productivity agenda.
We'll be looking at education, schools, capacity constraints. All of those things that we need to
get right as a nation to make sure that we get sustainable growth. But also, part of that subset
will be infrastructure, both hard infrastructure and social infrastructure. Impacts of the digital
economy, all of these things actually flow across into the session that will be chaired by David
Morgan as well on the overall economy with Wayne Swan and the productivity agenda being looked at
by Julia Gillard. Bringing all of those things together with the other elements of the 10 people
who will be there and the contributors will give us a reasonably good outcome, and a snapshot in
time of what some of the ideas are that we as a nation can pursue.

GLENN MILNE: Will the end point be ideas or policies?

WARWICK SMITH: I think you'll find that there will be ideas which will be reported and
consolidated, and the Prime Minister has indicated that they will be responding to those towards
the end of the year. And I think that you'll probably find that with a budget on May 13, an
absolute key budget for our nation, some of these ideas will be there prior to and post budget and
I think that as we look at the challenges we've got and an economy which is more challenging than
anyone would have thought when we looked at the election in November, let's be fair, this is a very
difficult situation we all find ourselves in. So, the more ideas we can have that can be discussed,
that can be constructively discussed, I think will be an advantage.

ELEANOR HALL: It's a huge area that you're covering there. We're seeing more and more reports about
how cities like Sydney are becoming more unliveable and more expensive. You used to work for
Macquarie Bank, one of the big infrastructure investors. Can you point to anywhere where
infrastructure investment has made cities like Sydney more liveable?

WARWICK SMITH: The liveable cities argument, I think it is nearly 87% of Australians are living in
large cities. Nearly 10 years at Macquarie Bank taught me that globally, the mobilisation of
finances behind infrastructure, both social infrastructure, and by that I mean childcare, aged
care, affordable housing etc, all of those things with the hard infrastructure like airports and
bridges and roads, we that we know that those things, in combination are absolutely fundamental for
a liveable city, for example water. The water storage, the water reticulation. All of those things
need to be addressed, but you can't do that unless you've got the people who are skilled to do it.
And one of our problems in the productivity arrangements is that the capacity constraints we have,
we've now got submariners going from the submarine fleet to run the mining camps. We have got
capacity constraints and the skills acquisition and the deployment and those issues will be just as
important as getting the infrastructure arrangements correct. If you want to have a liveable city,
and we all want a liveable city and we all want to be mindful of the green agendas which are
appropriate green agendas and looking at population and how it interfaces with liveable cities, you
have to have basic, basic outcomes. The problem for Australia is that there's been lags in
delivering infrastructure into cities. Now, there's an historic opportunity in my view, and I'm
quite an independent observer of these matters these days. My view is that there's quite a historic
opportunity to get cooperation between the States and the Commonwealth, both as to financing hard
infrastructure and delivery which is in the hands of the States to a large degree, and addressing
some of those things that all sides of politics knows. That if you want to have liveable cities,
you have to deliver the outcomes sooner rather than later and it is absolutely imperative now for
the prosperity of Australia if it wants to be sustainable to get things right and get them right
now. If people come with ideas to Canberra, whether they're chancellors, vice-chancellors, heads of
industry, financiers, people in the community - we all understand unless we get decisions sooner
rather than later, then our liveable cities will continue to degrade themselves as against our
international benchmarks - and that's a real concern for us.

GLENN MILNE: On the question of livability in cities, Bob Carr, the former NSW Premier complained
that one of the problems is with immigration flows. Where new migrants end up. They go to big
cities. Do you think there has to be incentives to shift new migrants into the country?

WARWICK SMITH: Let's start from the other point. Growth is about population, participation and
productivity. They're the key elements of growth. The allocation and location of migrants and the
distribution of the population is something that we have to work out. One thing we do know is that
we're short of skills. We are not employing the population to their full participation capacity and
migrants is part of that process . Making it easier for people to come to Australia I think is
important.

PAUL BONGIORNO: Plenty to think about and certainly plenty to talk about. Thank you very much for
being with us today Warwick Smith. And thanks to Eleanor Hall and Glenn Milne. Until next week,
goodbye.