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(generated from captions) Tonight the fall out from

Cable-gate and the WikiLeaks

founder on his cause. What

drives you? Defending victims.

And I'm a combative person.

That's how I like crushing

bastards. The reaction as

world leaders are dissected on

circuit. Certainly the release the secret

of those documents on our assessment could be prejudicial to Australia's national security interests. Live. This Program Is Captioned

Good evening. Welcome to

'Lateline'. I'm ae Leigh Sales.

The Victorian Labor Premier

John Brumby has conceded defeat

Liberal Ted Ballieu is the new in that State's

premier. The polls are predicting the State Labor governments in New South Wales

and Queensland could go the

same way, meaning Julia Gillard

will soon find herself dealing

with States of a different

political hue. You can get

along with premiers of another

political persuasion, if you

understand the reality of it.

And when you get into government, although your

political differences remain,

there is a common purpose and

there is a skepticism on the

part of the electorate if you overdo

Joining the program tonight is the former Prime Minister John

Howard. We'll also discuss some

of the other big political

issues of the year. That

interview shortly, but first other our headlines. Stand and

deliver. The Prime Minister

promises a new year of living

decisively. And either he goes or I go. The New South Wales

Premier's ultimatum to one of

Labor's powerbrokers.

Historians are having a field

day, diplomats are mortified

for and Washington's bracing itself

leaking of a quarter of a

million US diplomatic cables.

The ones that have come out so

far give an unvarnished insight

into American foreign policy from containing nuclear armed Iran the rise of

China and the possible collapse

of North Korea. But what is

seegz most attention is the

brutally candid views expressed

about many world leaders. The United States is trying to contain the damage by apologising and threatening

legal action against the culprits. Peter Lloyd Iran has been testing its air

defences this month against the

possibility of an attack on its

nuclear facilities. We now know

that the Saudis and others in

the Middle East have been

pressing for American and in language that's

explicit. King Abdullah Saudi

Arabia urging the US to carry

out air strikes is quoted in

one cable as saying "Cut off

the head of the snake". the head of the snake". There

are differing views in Israel

according to a US Embassy

cable, but it warns that the

Israeli Defence Force prefers air strikes and may be about planning them in secret. President Mahmoud

Ahmadinejad of Iran is

the Middle East according to distrusted by most leaders in

diplomatic cables. Hitler,

unbalanced, crazy are just some

of the character

assessments. What drives

you? Defending victims. And I'm

a combative person . I like crushing bastards. So it is

deeply personal ly satisfying

to me. This is the man behind WikiLeaks, but his day-to-day

role has become less clear

since he became a fugitive from

Swedish justice. He's wanted

for questioning in Stockholm over the allege ed rape and

sexual assault of two women in

August. Among the hundreds of

US diplomatic cables published by WikiLeaks today are some

which will anger key Washington

allies. Saudi donors are said

to be the main financiers of

Sunni terrorist groups,

including al-Qaeda. And it gets

very personal. French Nicolas Sarkozy is called thin

skinned and the naked emperor.

The German Chancellor is

described as Angela Merkel,

teflon Merkel and Hamid Karzai

is weak and driven by paranoia

Gaddafi receives a great deal

of critical attention. E is

afraid to fly over water or

stay in rooms above the first

floor. He enjoys flamenco

dancing and has a blonde

Ukranian nurse as a conspicuous and constant travelling dictator Kim Jong Il is companion.

according to a source, a flabby

old chap. The State Department

condemned the release of the

cables, saying it would endanger lives. Tonight, from

an undisclosed location via

video link to an audience in

Jordan, the founder delivered

this reply. It understands that

we are a responsible organisation, so it's trying to

make us - make it as hard for us as possible to publish

responsibly in the hope that it

can get us to not publish anything at all. On WikiLeaks

I'm not going to comment on cables and intelligence

matters, but obviously the

government is keeping the

matter under close appraisal

and the Attorney-General's been making some statements about

our mechanisms for doing that today. The Prime Minister has

set up a government task force

led by the Federal Police to

assess the national security

implications of cables deemed national interest. The damaging to

Americans have already been on

the phone to warn ministers what to expect as more

confidential cables are

released. Certainly, the

release of those documents on

our assessment could be prejudicial to Australia's national security interests.

Tonight only a fraction of the

250,000 documents have been

released. It's unclear how long

WikiLeaks will take to finish

the job. Let's cross to London

to get the latest on the anticipating the release of WikiLeaks

many more documents. What's expected to come out today? We're expected to see quite a raft quite

quite a raft of disparaging

comments from the Obama

administration directed

squarely at the UK. Not only the government but also the

royal family. The 'Daily Mail'

is reporting that the leaks

that are about to fall will say

something about Prince Andrew

the Duke of York, that he is

apparently considered to be

has on a number of occasions,

demonstrated inappropriate

behaviour on visits the US.

Prince Andrew is of course the

trade envoy for the UK. The

leaks are also expected to say

something about David Cameron

apparently President Obama's the Prime Minister. And

view of Mr Cameron as being not a particularly impressive world

leader. On Gordon Brown, David Cameron's predecessor, apparently apparently the leaks will say that Washington considers

Gordon Brown unstable. This is

going to be particularly

damaging I suspect to the relationship between the US

the UK and much is always made of that relationship,

particularly here in Britain,

where they like to refer to it

as the special relationship and

so on. So far Downing Street

has said only that these

revelations acted no matter how

much more critical they become

they will not damage the

they've condemned them in much the same way as Washington

have. And briefly, there are supposedly more than a quarter

of a million dock.S But we have

only seen a few hundred so far.

Where y is the release so

piecemeal? It appears from a Twitter release from the

WikiLeaks founder or someone

from the web site has posted a

tweet that says that there has

been - that the site has

suffered a disturbed denial of service. Which telling us that there has been

some sort of hacking into the

WikiLeaks web site. Now, from what I understand, this

disturbance of the disturbance of the denial of service is someone trying to

take a lot of information from

the site which slows the site

down and causes it to be unable

in itself to release more

information. The other reason of course is that they have

always said this was going to

be a phased release that they

were going to release certain data on certain days, so as not

to I guess overwhelm media

organisations trying to report

the information as it was

coming out. So this was always

planned to be quite a staged approach. approach. So it wasn't all being flooding into the media

at once. Thank you for that. This evening, Victoria's Premier John Brumby has

conceded defeat, paving the way for Liberal Leader Ted Ballieu

to become the State's 46th

premier. Mr Baillieu visited Government House tonight after

a dramatic election which came down to the result

change of government brings to

an end more than a decade of

Labor rule in Victoria. After 11 years the people of Victoria

felt that it was time to give

another team and another party

a chance. And as one observer

put it to me earlier today, the

weight of time took its toll.

John Brumby ended 11 years of

Labor rule in Victoria after

his loss on the weekend. Today,

paying tribute to his party's

in my mind that we leave

Victoria today a stronger, a

better and a fairer place than

we found it 11 years ago.

(Applause) In that context ...

And for the new premier,

tomorrow ushers in a new

political era. Relishing the

opportunities which lie in

front of us but we're also very sanguine about the work that

needs to be done. In the end

the result hung on the

of one seat, Bentley in

Melbourne's south-east as the

coalition hovered on 44, one

seat short of a total majority.

I'll just do a quick intro.

Glen is your team leader for

today. For a moment these Electoral Commission officials

and scrutineers were the most

important people in the state

as every vote was forensically examined

examined and arcked over. No, sorry, has to be all numbers. It doesn't have to be

all numbers. But the numbers

really fell into place early on had showed the coalition with a

slight edge over the Labor

Government and as the booths

closed it was clear the

election was up for grabs. I

will say this, we're on the

cusp of something remarkable

happening. Of the 13 seats gained by the coalition gained by the coalition 12 were

won by the Liberals in the

south-east of Melbourne. A

mixture of established and

newer suburbs. It's an area hit hard by key election issues

like the cost of living and

Melbourne's public transport difficulties. I

was probably the crucial issue.

The inability of the government

to turn around the problems

with Victoria's transport

system became a system became a symbol of what

was seen as its paralysis, it's

fatigue as a government, and

its age as a government. Seats

Labor expected to hold like

Karrem contributed to the shock

of the loss. We didn't expect

to lose. We'd polled Karrem and

it showed us half a million people used

postal votes which favoured the

major parties. And as expected,

the Greens didn't win any of

the inner city seats they were

confident of

prior to the crucial decision

by the Liberals to preference

the Greens last. The defeated

Greens candidate for the seat

of Melbourne had a very green

explanation for the large

absentee vote. Today the great

Victorian bike ride starts up

on the Murray. I know there are

a lot of people from the

electorate who are going off to

do that. It's bush people go out doing that sort

of thing. While the Prime

Minister was politically philosophical about

philosophical about her home

State. You don't need to be too much of a

much of a student of political

history to know that it is very difficult for long-term

governments to present and have

their mandate renewed and I

think that's what we've seen

happen in Victoria. While John

Brumby failed to be elected

premier in his own right after

taking over from Steve Bracks in 2007, his government managed

the state well, according to

this expert. Of course the

common view is that of the

State Labor Governments that

came to power in a cycle beginning with the Carr

Government in the mid 90s, Victoria's was the best

performed of those. Analysts

say a number of factors

contributed to Labor's loss

last weekend, including public

transport issues, electoral

fatigue and the cost of living.

address all of those issues but

how long that will take remains

to be seen. The first priority

is to provide stable,

responsible and disciplined government, I've indicateed in

policy terms, we obviously have priorities in regard to community

community safety, reliable

transport, and a range of other

issues. But we will take this a

step at a time. In New South Wales, there's

an irreparable rift between the State premier and from an election that polls are

predict will go throw Labor out

of office. Bernie Riordan who's

also the head of the Electrical Trades Union has advised his

members to consider voting for non-Labor candidates.

non-Labor candidates. A furious

premier says Mr Riordan has

until Friday to quit or she

will. I made my view clear. He

has lost my confidence as party President. His position is untenable. untenable. It's either you or

him. You're still staking your

position as leader on this? If

that becomes the question, then it's me. Kristina

been backed by other Labor

identities, including former

Premier Morris Iemma and federal frontbencher Anthony Albanese. Bernie Riordan has

been unavailable for comment

today. For federal MPs, the

long parliamentary year is

finally over. And already the

Prime Minister's looking ahead to 2011. Julia Gillard's

declared it will be a year government on track with its

broadband plans, it's making

action on climate change a

priority. Ms Gillard's also brought forward the deadline for her government to make a

decision about how decision about how to price

carbon. From Canberra, Susan

McDonald reports. After one

final day in the chamber, MPs

fled for the summer break. Happy new year. In the end it was only a two-hour

sitting at a cost of around

$700,000. Democracy is

expensive. There that's no

doubt about it. The ayes have T The Bill to

was passed, without a formal

vote. They weren't real fair te dinkum, were they? The Leader

of the House has the call. It

was all over with a whimper,

but it came after a vigorous

debate 2010 is ending very

badly for the Australian Labor

Party. How sour they are. How

sad they are as they limp their

way out of 2010 and into 2011. Doesn't the shout tell you something? The

opposition has come here today

to have a temper tantrum.

Acting like 2-year-olds, mired

in their bitterness. In in their bitterness. In their bitterness about defeat. Tony

Abbott zeroed in on Labor's hammering in the Victorian

election. That's what we are

seeing. A Labor brand which is

increasingly toxic right around

this country. But the

theatrics from both sides

didn't impress the here for rhetoric over reality.

I did not come here for

politics over policy. Drama aside, the Prime Minister emerged

emerged with approval to

ahead with the national broadband

broadband network and she's

looking to what can be achieved

next year. So 2011 will be a

year of delivery and decision.

At the top of her agenda -

bringing forward the deadline

for a decision on a price on carbon to next year. I promise you

maker will be able to next year

that they need more time or

more information on climate

change. In 2011, there will be

nowhere to hide. Ducking for

cover isn't Tony Abbott's style. Shouldn't every year,

shouldn't every day of every

week and every month be a time

when governments should be

about deciding and delivering? Changing the

talk and no action requires

more than just talk. In the

area of health reform, the

election of a coalition government in Victoria complicates matters. Julia Gillard says she's undeterred,

and more broadly the Prime Minister is seeking to recast the political landscape. Australians do not

want their government to

campaign. Australians want

their government to govern. We

are and we will. (Applause)

With no governing for him to do, Tony do, Tony Abbott's continuous

campaign swung into Western Sydney. Certainly, in

government, we would be

absolutely red hot on these

sorts of issues. All talk,

with the promise of

To discuss the implications

of the Victorian election

result and reflect on other

issues in Australian politics,

I was joined in our Sydney

studio earlier by the former

Prime Minister John Howard. Mr Howard,

to see you. We can start by

looking at the Victorian election and what's happening

there. Happily so! (Laughs) New South Wales Labor is in dire straits dire straits there's also doubts about whether Labor can

hang on in Queensland. You're

no stranger to having State

Governments of a different hue. How will it affect the Prime Minister's agenda? It depends

entirely on what ultimately

works out. I expect there to be

a change of government in New South Wales. I will be

astonished if it doesn't occur.

It will depend entirely on

she handles T you can can get

along with premiers of another political persuasion if you

understand the reality of it.

When you get into

although your political

differences remain, there is a

common purpose, and there is a

skepticism on the part of the electorate if you overdo the partisanship. And it does

happen, but I found for most of

the time that I was dealing with predominantly Labor

Premiers I could get through my agenda, year. When they really sort of

did a number on me in relation to the Murray-Darling, but

leaving that say side, a lot of

the other time, we got on quite

well. So what is the best way to manage your way through that situation? Well, obviously pick

things that are not offensive

to Liberal philosophy. When I

was Prime Minister there were

some things I couldn't get past

Labor Premiers no matter what

the circumstances were. They

were never going to happen me

on industrial relations reform.

On the other hand, in other areas, we achieved an enormous amount,

amount, and areas like

education and health, so it's a

question of taking issues as

they come. Recognising that

you're not going to get things through that through that involve some

violation of your opponent's

philosophy. It seems at the

moment like on nearly every

issue it's set up up to be a

violation of one or the other

party's philosophy? I don't

think so we're living in new

territory. I think we have to

allow a few months to go by

still to see how it all shapes

out. situation. We do have a minority government. I mean, in

Victoria we're going to have a

majority coalition government.

A slim majority but it's still

a majority coalition

government. The problem Julia Gillard is her government is held together with a cosmopolitan collection of

Greens and rural independents

most of whose supporters are Conservative. It's a very

unusual situation. The

situation in Victoria is

obviously good news for the

Liberal Party and the coalition. Is it possible,

though, that it could be something that Gillard come the next election,

next federal election if you've

got a whole lot of State Governments of a different

persuasion because at least she

doesn't have toxic State Labor governments to deal

didn't work for us in 2007. So

look, it depends entirely on

how she governs and can I just

say about Victoria, it's a fantastic result for Ted

Ballieu and full marks to him. I

I mean, he really has done

extremely well and he deserves

all the credit he is receiving.

I think the Victorian party organisation, their State

director is the best Liberal

country. A combination of a

good organisation and a good

parliamentary leader has

delivered the goods. And full marks to him. Do you that it was about State issues

entirely public transport and

hospital and things of that

nature? Yes, I do. I think for

a long time, elections have by

and large been fought on State

issues when there's State and

federal issues when they're

federal. Occasionally if you've

got a really bad State

Government it will influence

the federal vote. That happened

in Victoria in in Victoria in 1990. In the

Cain Kirner years. But

generally people are very

clever. They work out the

difference. That's what they've done. On the Liberal Party

decision not to preference the Greens, do you think that Greens, do you think that is

now the way of the party to go

broadly? Yes, I've expressed

that view. I think that was a

defining decision. It drew

defining decision. It drew very strong support from Liberal

Party members in Victoria. They

hated the idea of preferencing

the Greens ahead of Labor. They thought it was philosophically

wrong. And you know, it's not a

bad idea for political parties their membership on things as

basic as that I think Ted

Ballieu was seen as strong,

decisive and principleed in the

decision he took. I hope it's emulated in New South Wales

come the next State election

here. The Victorian Labor

minister Bill Shorten says one

of the reasons Labor lost was

because they were distracted by

the Greens in the battle for

inyes city seats. I'm wondering

if the Liberals take the Greens

out of the equation by out of the equation by not preferencing them if you're

giving them a chance to focus on the fight with you? The most

important thing is to practise

what you preach. what you preach. If you preach

that people against free enterprise, people who don't

believe in the American

alliance, people who have alliance, people who have very

odd anti-capitalist competitive

views as the Greens have, you

shouldn't preference them ahead

of the Labor Party. People join

a political party because they

believe in certain things. If that political party then

behaves antagonisticically to

that set of beliefs they disillusion their membership. We've seen some close elections this year.

Tasmania, the federal election, anything out of that, about the

electoral mood? I think the

situation is that as politics

has become less particularly at a State level,

people will move around more

freely. I do think there's an

"it's time "factor. 10 years is

about the shelf life of any

government in the modern times, absent

absent a completely hopeless

opposition. But why aren't you

seeing some decisive victories

one way or the other then? I

think you will see a victory in New South Wales. But

most people were predicting

that the Labor Party would

scramble back in Victoria. For the Liberal Party to

narrowly that represents a decisive shift. The swing was

in the order of 6 or 7%. That's

a very big swing. The Liberal

Party was a long way behind.

And the other real message out

of Victoria is the continued resurgence of the National

Party at the expense of the

independents. I mean, that's a very significant thing. The defeat

who helped Steve Bracks to

power in 1999, that's a very significant development, and

full marks to Peter rye yand

and the National Party for having won that seat back. You

said that politics is less

ideological now. Why do you

think that is? Because we no

longer have a Cold War. We no longer have a worldwide definition of the difference

between right and left and the

whole centre of gravity of the economic debate shifted competitive market forces in

the 1980s and 1990s. When I

entered federal politics in the

70s, people were still arguing

that the State should have a bigger share bigger share of the gross domestic product, of the

national wealth. I think there

has been a whole shift to the

right. And the Labor Party in

government espoused attitudes

that it - to the right of what some in the Liberal Party

espouseed in the 60s. Those

market reforms you talk about

in the 8 0s and 9 0, the Cold

War ending in the late 8 0s

that was all over when you were

Prime Minister and you ideological politician? Well,

perhaps I wasn't as ideological

as my detractors alleged. I

mean I didn't run are a

fanatical far right agenda. I

ran a mainstream agenda. And it

was very warmly supported by

people. I think people would

think I governed for all of us

and not just for a narrow minority. Is the global

financial crisis something that

could reintroduce ideology into

politics? You talked about the

role of the State and the way

people perceived that in the

80s. The financial crisis threw

up a whole lot of questions about state should be? I don't think

in the long run it will and I

hope it doesn't. Because the

global financial crisis was not

an indictment of market capitalism. The global

financial crisis was an

indictment of a lot of failures

in various areas, including in

America, the stupidity of

giving people loans that they

had no opportunity of repaying.

I think the message out of the

last 30 or 40 years is that

globalisation and free markets

have lifted tens of millions of

people out of poverty. And we

should not lose sight of that Australian domestic politics,

are opinion polls having too much impact on policy? They

probably are with some people,

but if you really want to

reform things, you find out

what the public wants and if

you think the national interest

lies in another direction, then

you set out to change public

opinion, and I succeeded in

doing that. My government

succeeded in doing that in

relation to things like the

GST. Waterfront reand the reform and the like. So

conviction is still the mother

of success in politics. If you

really want to achieve

something, then you've got to

go out and argue your case

I think this country had a good

record of economic reform over

a long period of time. There were contributions from the

Labor side to that as well as

from the coalition side. I

think we benefited and it's one

of the reasons why we came through the global financial

crisis so well, that we had

reformed ourselves and we were there for bulletproof to the ravages of the world economic collapse. So when you were considering

the GST and you were polling on

that, it would've been quite

unpopular at the time, did that ever give you pause to think,

well should we drop this? No, no, it

no, it didn't. I mean, believed

in the GST for years. I put it

off the agenda. My remarks

before the 1996 election. But

then I decided that we should

bring it back. And we put it on

the table before the 1998

election and we invited the

Australian public to throw us

out if they didn't want it. I

mean and they went close some other reasons why we lost

seats at that time as well, but

I thought it was a long-term

reform and I took the view that

if you had a big majority, you

had a lot of political capital,

you had to use it on something.

What is the point of being in

office if you don't do something? Do you see evidence

that political leaders of

either persuasion are still pursuing that approach? Well,

it's a very unusual situation

at the moment. It's very hard

for either, trying to be as charitable charitable as I can, post-active political life.

It's quite difficult for either

to break out, but I hope that -

for example, I think the

country at some stage has got

to revisit industrial relations

reform and you can't leave that

in the state that it was left

after Julia Gillard brought in

the fair work Act because in a

couple of years' time many of

these agreements run out we'll

find that we've got a strangulated labour market rather than a free labour market. Tony Abbott said it's

dead, buried an cremated? But

that's perfectly consistent

with what I have said that was

the policy the policy he took to the

election. What he was talking

of was WorkChoices. There was

one us a Peckett of WorkChoices

that I freely acknowledge in my

book was a mistake and that was

the abolition of the no

disadvantage test that was a

big political error. That's

what Tony was referring to in

relation to that. But Labor has rolled this thing back way

beyond the restoration of the no disadvantage test which incidentally we restored before

we left office, but the whole

issue of unfair dismissals for

spall business and a lot of other other things that has to be revisited at some stage. You see in the current environment

it will be difficult for either

side too break through. Julia

Gillard persuaded the independents to support her to

make government. She negotiated her way through having a

Telstra Bill passed last week.

Is she proving that she's a

better negotiator than Tony

Abbott.5and does that mean that these times are going to suit

her better? I don't think the

fact that she got the numbers to form government was an

adverse reflection on Tony's

negotiating skills. Let's face it, Adam Bandt and Wilkie were

always going to support the

Labor Party. Want said so in

the campaign and Wilkie had

previously been a Green

candidate there was no way

either of them were going to

support them. You had the

antipathy between Tony Windsor

and the National Party which

has a long personal history to

it. So I don't think that was a

vindication of her negotiating skills. I think it was an

inevitable consequence of the

personal chemistry and political beliefs

political beliefs of the people

involved. What about her ability to have got that

Telstra Bill through? I think that means - I mean it's

been trumpeted as a huge

reform. It's nothing. Kind.

That's what they said about the

mining tax. Wayne Swan with his

40% super tax on the mining industry, say this is the

greatest tax reform for

decades. The thing was a

disaster. I think the coalition

position on the broadband was

absolutely right. I mean, an enormous waste of money. It's an unnecessary regulation

because in many parts of

Australia they're contemplating

forcing people to take it unless unless they definitely say no

they won't have it. And I think

that's a very authoritarian regulatory way of approaching something like this. The Liberal backbencher Steve Ciobo

told the coalition party room

last week that they needed to

come up with more ideas and

policies to counter act this Labor line that Tony Abbott is

a wrecker. It is a Labor line.

Nothing more than not a fair, objective

assessment. But it would be

gaining traction if the

coalition was putting forward more of its own ideas? The coalition put forward a lot of

ideas in the ideas in the last term. Just remember, Tony was leader for

less than eight or nine months

and he brought the party back

from the dead and almost won

government in his first go. And

I think he's got to be given a

little more time and of course

you don't just oppose, but

although the Labor Party

largely opposed us on all of government. I don't remember

them ever supporting any of our

big reforms, unlike us, who

supported Hawke's cutting supported Hawke's cutting of

tariffs and the deregulation of

the financial system.

Party talks about this wrecker thing. When we were in

government, they didn't back

any of our big changes. None of

them. So I think it's a touch

twee for the Labor Party to be

saying Tony's a wrecker, he's

got to get on board and get

with the team. Well, I think that's just response to your book, the former Treasurer Peter Costello

wrote of you that he will not

take responsibility for what

the whole of Australia knows,

that he stayed too long. Will

you admit that with the benefit

of hindsight? I dealt with that

in the book. The reality is I

stayed in 2006 which would've

been the time for me to have

gone because the overwhelming majority of the parliamentary

party wanted me to stay. In

hindsight, was it staying too

long, though? No, I don't think judgment of your colleagues and

your own judgment is that it

was in the party's interests in

the light of everything that had happened in

had happened in 2006, had happened in 2006, that I

stay. There's no hard and fast

history on this sort of thing.

You see changes of leaders that

can give a party another term

as has happened with keeting and Hawke. You can see the

change of leader that didn't buy the Labor term. You have to look at these

things according to the

circumstances. It had been my

working intention of retiring

at the end of 2006 but for the reasons that arose there was be a overwhelming feeling in the

party that I should stay and

that's - and I responded to

that. Now we lost - we have won

if Peter had been leader? The

honest answer is I don't know.

Nobody knows. All all I can say

is that the evidence tends to suggest that people tire of

governments rather than of

people, and I think 10 years is

about the shelf life of any

government, even if it's a very

good government, as ours was. So no So no regrets about the way you went? No, look, I didn't like

losing. I didn't like losing at

all but I lost.

all but I lost. And I look at

the legacy and it's a very good

one. Can I say that Peter Costello made an enormous contribution to that legacy as

I say in my book, he was the

best Treasurer Australia has ever had. And ever had. And he did an

outstanding jock that the GST. We worked together in very close professional harmony. The

real story of our relationship

is one of harmonious

cooperation in the common good.

That's the economic strength of

Australia. If I could just ask

you briefly about the WikiLeaks

story. What course is available

for governments to respond to

that? Well, very difficult. And

I guess all you can do is what current governments have done, both the Australian Government Government and complain and

point out the dangers and say

that you are putting lives at

risk. We shouldn't be too shocked at some of shocked at some of the more

candid comments in cables. That's the reality of

diplomatic exchanges. The

things that bother me are

anything that touches on

security and might put the

lives of people in the field at

risks, and I think the people

who put this stuff out in a

random, willy-nilly fashion are

recklessly almost criminally indifferent to the lives people who are only doing their indifferent to the lives of

people who are only doing national duty. Having said

that, secrecy isn't always in

the public interest. And it

could be material in these documents particularly, for

example, about the lead-up to

the Iraq war and Australia's

thinking on that that people are interested to know? Well,

I'm happy to be questioned, as

the person who was more responsible than anybody else for Australia being involved in

Iraq. I'm perfectly happy to

answer questions in relation to

that, but I mean, in

Australia's case that has been done over very closely.

Parliamentary inquiries and the

like and nobody suggested that

we made up the intelligence although it inaccurate. There are

apparently about 1,000 cables

between Australia and the US

that are going to be released

as part of this. Are you

confident there is nothing in there that will embarrass you

or your government? I'm

confident there's nothing I can did at

did at the time that doesn't

bear proper scrutiny 'cause I

was very transparent. It was

obvious that we were preparing

to be involved, although we

withheld the final decision

until right at the end. I do that that very extensively in my my

book. It's the largest chapter

of the 46 in my book. As far as

I'm concerned, I'm happy to continue answering questions on

it but I don't know what's in those those cables. I'm not responsible for what individual

diplomats in either Canberra or

Washington might say in cables

but I can only say of my own

behaviour in and my own

actions I'm not aware of

anything that's going to embarrass

embarrass me or anything that's

inconsistent with what I've previously said. John Howard,

thank you very much. Thank you.

Now to the weather. Showers

and storms in Sydney and Darwin

with showers increasing in

Brisbane and thundery rain for

Canberra.

That's all from us. If you'd

like to look back at tonight's

interview with John Howard or

review any of 'Lateline''s

stories or transcripts, you can

visits our web site and also

follow us on Twitter and

Facebook . I can see you again

tomorrow. Goodnight. Closed Captions by CSI This Program Is Captioned Live.

Good evening and welcome to

Lateline Business, I'm Ticky Fullerton. Tonight we talk to

one of India's top CEOs, a

global guru of the back office. In our other up production, Rio Tinto sees

no end to China's demand for

raw materials. We plan to

drill an unprecedented 3.9

million metres in million metres in the next five

years which will provide a

pathway to 330 million tons per

annum and beyond. The banking headache continues with

National Australia Bank

customers still unable to access

access some payments. The description

description of a glitch is a

complete euphemism and

misnomer. It is a major

stuff-up and you can be sure at the NAB fruity language than that. And

politicians agree on the need

for speed. Trains that is. But

will the huge cost derail the

latest attempt to develop

high-speed rail.? Our prosperity and productivity

will be held back by will be held back by the

quality of our infrastructure

unless we address it. To the

markets:

The world's third miner, Rio Tinto, is back in

expansion mode. Executives told

an investors briefing in Sydney

today the company will triple capital expenditure to $11

million this year. As developing countries get retcher, demand for ore is

expected to double over the

next two decades. With Rio

Tinto's sweet of low cost,

large scale expandable assets

along with core skills and

operating exploration, technology and innovation, we

are very well positioned to

meet these opportunities. Over the next five years, the

company is planning to increase

iron ore production in the Pilbara region of WA by more

than 50%. Rio Tinto currently

produces 220 million tons of

iron ore a year but hopes to in

crease this to 283 million tons

by 2013 and by up to 333

million tons per annum by

2015. We plan to drill an

unprecedented 3.9 million

metres in the next five years

which will provide a pathway to 330 million tons per annum and beyond. The company took the

unusual step of giving

investors a breakdown on the

yet to be approved plans for

expansion in the region. Of the 10.4 billion dollars of capital

expenditure, there will be 6.4

billion spent on pine capacity

at billion sites, 3.2 billion on

on port and rail infrastructure

and 800 million spent on power and town infrastructure. Rio

says it will look at mergers and acquisitions but and acquisitions but wouldn't discuss That is obvious ly mainly on

organic growth but could

include judicious MNA of a

small or medium sized kind. The mining giant conceded

challenges ahead. We

anticipate the mining sector

will need to overcome

challenges to meet demand

growth over the next two

decades. Skill shortages are

being reported in certain new

project hot spots as mining

companies compete not only with

ex-each but with other expanding sectors, political

particularly oil and gas.

Although we can't generate Although we can't generate the

synergies that we had hoped to

in relation of a in relation of a joint venture, the very best way of adding

value without the joint venture

is to actually expand and ship

100% Rio tons and that's what

we're doing. The copper

division was a concern for many

investors because of lower

grades at Rio's three biggest

mines. Rio says production will decline 15% 560,000 tons but it's hoped to

rebound after 20 12 as grades

improve. Rio Tinto share price

failed to rebound however,

closing down 20 cents at

$83.84. For his take on the

rest of the local markiate

spoke with Charlie Aitken from

Southern Cross Equities. Charlie Aitken, a pretty

indecisive seltion so how

convincing was the market rally

going into the close? I

wouldn't say it was totally

convincing but it was a wild

day for a Monday. At one stage

we were down 44 point and then

up 33 forces at work, the

Government-G and evil of North

Korea, South Korea, Ireland and

Spain but at the end of the day the market was up. Turning

stocks and AMP now has a

binding agreement in its bid

for AXA Asia Pacific after satisfactory satisfactory due diligence.

How's the market taken it? It

was a step forward for AMP. I

think most people think this is

a sensible deal and will

eventually hold value for AMP

shareholders over time but it's

long-dated, will go on for

months and months. AMP shares doing a doing a little better. Any form

of certain helps but it's long

dated. Is NAB baring any scars from its computer glitch as far

as investors are concerned? Didn't go well last NAB, the shares are down and

didn't help , the computer

glitch, it's bad PR. It is in

the process of DRP pricing

period. That sended today and

the stock did better, as did

all the banks. More broadly

the banks are doing well? They

are and I have a theory this is

to do into recess over the summer.

You will have less bank bashing

and they may edge and they may edge better. The

distinct underprOrler was the retail sector is. That market taking a view about

Christmas? That was the

stand-out feature of the day,

just about every retail stock

down 1 or two%. There's been profit warns from Premier

investments who own just jeans,

Coca-Cola and Harvey Norman

made comments that weren't upbeat. There is a genuine

feeling that Christmas trading

is not good, sales have started more price aware and waiting

for bargains. Not looking good

for the retailers in the

short-term, remembering some of

the people make 30% of their

profits in the month of December alone. Charlie December alone. Charlie Aitken, great to have you great to have you with us in

2010. Thanks for joining us. To

the other major movers on the

local share market now. The

Commonwealth led the banks up,

there was a rezrgeance in iron ore minor sun dance resources.

The story of strong commodities continues. The

governor of the Reserve Bank

believes Australia's resulting

2-speed economy could be here

to stay. Glenn Stevens has told

the 50th anniversary dinner of

the committee for economic development of Australia in

Melbourne that the resources

boom will drive structural

change in the economy which will see some regions struggle as

capital and labour is attract

ed to the resource-rich areas. Andrew Robertson has been

running his eye over Mr

Stevens' speech and joins me in

the studio. The governor seems

to be confirming what many business people, particularly

in the eastern states, fear

about the future direction of the Australian economy? That's

right. Mr Stevens began by

saying he wasn't going to talk

about interest rates and said

he wanted to look at what he

called a broader canvas and that's the huge increase in driven by the resources boom.

Mr Stevens believes the terms

of trade will stay in his

words, "Persistent ly higher

than they used to be and will

lead to trurl lead to trurl change in the Kim." This is what he thinks

had structural change is going

to look like. He said some

businesses and incomes will become relatively smaller, jobs

growth in some areas will slow

even as in other areas it picks

up, some regions will struggle more than others, some sources

of Government revenue would of Government revenue would be adversely affected even as other other sources see an

improvement. He went on to say this process will unreasonably as costly by this process will be seen unreasonably as costly by those