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Transcript of doorstop interview: Parliament House, Canberra: 19 September 2012: Standard and Poor's reaffirms Australia's AAA credit rating, child care; Coalition disunity over Cubbie Station; fiscal responsibility; Joe Hockey's $70 billion budget black hole; Cory Bernardi's offensive comments; Tony Abbott's failure to control his own party

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THE HON WAYNE SWAN MP Deputy Prime Minister Treasurer


19 September 2012


SUBJECTS: Standard and Poor’s reaffirms Australia’s AAA credit rating, child care, Coalition disunity over Cubbie Station, fiscal responsibility, Joe Hockey’s $70 billion budget black hole, Cory Bernardi’s offensive comments, Tony Abbott’s failure to control his own party

TREASURER: I just wanted to say a couple of things then I’m happy to take a couple of questions. Good news overnight with Standard and Poor’s reaffirming our AAA credit rating a stable outlook. One of seven countries in the world with that rating.

But also for the first time in our history, we have the gold-plated AAA rating from the three major global ratings agencies, something that was never achieved by the previous Government. This rating reflects sound fiscal policy, the resilience of the Australian economy and that’s good news for Australia.

JOURNALIST: Will Labor be subsidising childcare workers’ wages to the tune of $1.4 billion?

TREASURER: I made the point in the Parliament yesterday that there’s an important issue with childcare workers retaining and making sure that they’re well trained and so on...

JOURNALIST: Were this morning’s reports wrong though Mr Swan?

TREASURER: There’s no basis of fact to this morning’s reports at all.

JOURNALIST: Should we be reopening this (inaudible) for Cubbie Station given that we’ve now learnt there are least 12 other companies interested?

TREASURER: These were matters for the administrator. The administrator took the decision, these are not matters for the Australian Government. We applied the national interest test to the proposal that was presented to us by the administrators.

Now I don't know the right or the wrong of the reports this morning. I don't know whether they’re accurate or not. What this says is something about the chaos that is going on on Tony Abbott’s front bench, the continual rumblings and disunity caused by Barnaby Joyce, and Tony Abbott simply can't pull him into line.

JOURNALIST: Mr Swan there’s concerns in your party about the ongoing promises and how they will be funded. You were asked in a party room meeting yesterday. How did you quell those concerns?

TREASURER: First of all we always have good conversations about policy in our party room and we are absolutely committed to responsible fiscal policy, bringing our budget back to surplus in 2012-13, making responsible savings. We’ve done that for five

years, so we will always have a discussion in our party room about policy priorities but I just wanted to make the point that the reports this morning that the Government has taken a decision in this area have no basis in fact whatsoever.

JOURNALIST: Can you rule out this kind of sum?

TREASURER: I’ll say what I said in the Parliament yesterday, and that is as we go through our decision-making processes I don't play that silly game. I don't intend to.

JOURNALIST: Joe Hockey suggests there could be a $25 billion shortfall in the budget and that you may bring MYEFO forward and use budget trickery to try and get it into surplus?

TREASURER: We will account in the mid-year economic budget update for all of our plans for the future. We do that under the Charter of Budget Honesty. Joe Hockey refuses to comply with the Charter of Budget Honesty, but he was honest last year when he said on morning television that there was a $70 billion crater in the Liberal Party’s budget bottom line.

And we had this morning another outbreak of honest where he’s now reaffirmed that he said it despite that fact that they denied they said it for months and months and months. So Mr Hockey is not credible when it comes to fiscal policy. A $70 billion hole, he says all of his policies are costed and prepared, all he’s got to do is take the walk down the Parliamentary Budget Office, it’s not as far as Aussies so he can get down there pretty quick, and he can put out before the Australian people the plans that they have for the future. We will put ours out there, as we do in the mid-year budget update.

JOURNALIST: Will the reduction in company tax revenue see a reduction to the budget surplus potentially?

TREASURER: I’ve said before that there are implications for the budget which flow from lower commodity prices and we will account for that in the budget update. There’s nothing unusual about any of these things, that’s what MYEFO is all about. That’s why we publish it because it’s there, we must do it in terms of the Charter of Budget Honesty. The Liberals don't adhere to even their own charter because they know that they’ve got an unsustainable set of promises with a $70 billion crater in their budget bottom line plus they’ve got a plan for a company tax increase of 1.5 per cent.

JOURNALIST: Why not just raise taxes across the board like Doug Cameron says?

TREASURER: Well I’m not attracted to that proposition at all. I made that really clear in the Caucus yesterday. What we will do is make sure we keep our commitment on taxes, which is to keep them below the level we inherited when we won Government.

To make sure we give Australian workers a fair go, the tripling of the tax-free threshold - a fundamental tax reform - tax relief flowing through to small businesses, up to 2.7 million of them, the instant asset write-off. We put in place a whole raft of tax reforms so we make sure we continue to grow our economy and that we’re competitive in the region and globally.

JOURNALIST: Mr Swan, the Asian Century White Paper, you’ve been speaking a lot about in the last week about it, does that mean it’s going to be released very soon? And also there’s a lot of talk about structural reform recommended as a method of boosting productivity through the Asian Century White Paper. Can you be specific about that?

TREASURER: I mentioned this morning the most important structural reform for the future of our economy and productivity and that’s investing in education and training across the board.

JOURNALIST: Nick Xenophon and Christine Milne this morning have both come out backing the Coalition about the Cubbie Station sale. Do you think that perhaps the national interest test needs to be reassessed if there’s growing concern across not just the Coalition?

TREASURER: Not at all. We have a scrutiny of foreign investment proposals through the FIRB and then through myself applying the national interest test. This has served Australia well. What we’ve seen here on the conservative side of politics is disunity and Mr Joyce is showing contempt for Mr Abbott as the Leader of the Party.

Today we’ve had another example of that with Mr Bernardi who has made some very offensive remarks, and Mr Bernardi, I think ought to be sacked. He’s Mr Abbott’s parliamentary secretary, he’s made some very offensive remarks and I think Mr Abbott ought to show some leadership.

JOURNALIST: Treasurer will you bring on a vote on the Wheat Exports Authority given the troubles within the WA Liberal Party and the pressure they’re under to completely deregulate the actions wheat export markets ?

TREASURER: Look we don't put in place our policy responses just because there’s disunity in the Liberal Party.