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Transcript of joint press conference with Will Hodgman MP: Hobart: 22 February 2014: Tas Live Abalone; Tasmanian state election; NBN; AFP; Royal Commission into the Home Insulation Programme; Qantas

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JOINT PRESS CONFERENCE WITH WILL HODGMAN MP, HOBART Saturday, 22 February 2014 Hobart Prime Minister Subjects:

Tas Live Abalone; Tasmanian state election; NBN; AFP; Royal Commission into the Home Insulation Programme; Qantas. E&OE WILL HODGMAN: Firstly can I say how great it is to be at Tas Live Abalone; a fantastic Tasmanian business that’s been operating for over a decade and showcasing what Tasmania can produce and highlighting the great potential that our State’s economy has. It’s fantastic to be at such a great Tasmanian success story and especially fantastic to be here with Prime Minister Tony Abbott who comes back to this State with a very keen interest to see our economy grow, to lift Tasmania up off the bottom of the economic pile and to realise Tasmania’s potential. This election in Tasmania is a critical decision for Tasmanian’s to make about the future and the direction our State’s heading in. The Canberra experience of a Labor/Green minority government shows that they failed and they are not conducive to good economic outcomes. We need a strong economy so that we can invest in our essential services and improve the quality of life in Tasmania. Tasmania has suffered a Labor/Green government now for four years. We’re now getting a glimpse into what the next minority government in Tasmania might look like with Nick McKim as Premier. I think Tasmanians will be concerned to know that the next minority government could have at the helm a man who has talked down Tasmania’s economy, who has compromised business confidence, who has been instrumental in driving a stake into the heart of our forest industry. We’re now getting a sneak preview of what the next minority government could look like in Tasmania with Nick McKim as its leader. The only option for Tasmania is to get a majority government - a government that’s able to deliver a strong agenda, that will grow our economy, that will create jobs and will allow us to invest in essential services - is for Tasmanians to vote Liberal. If Tasmanians choose to vote for the Labor Party, the Palmer United Party or the Greens Party led by Nick McKim we now understand that the very likely outcome will be another minority government with Nick McKim as its leader. I’ll ask the Prime Minister to say a few things as well and then we’ll take some questions. PRIME MINISTER: It's really terrific to be at Tas Live Abalone, an outstanding local business and a sign of what Tasmanians can achieve when they have a go. I'm really pleased to be here in Tasmania with my friend Will Hodgman. Will wants to see Tasmania like the rest of Australia open for business. If you want Tasmania to be open for business - you've got to vote for Will Hodgman and the Liberal Party's candidates at this coming state election. Unfortunately, the Labor/Green government that we had in Canberra until recently and we still have here in Tasmania is congenitally hostile to business. It just can't help itself. If you want to have strong communities, you've got to have a strong economy to sustain them and the only way to have a strong economy is to have profitable private businesses like this one. So I'm pleased to be here with Will, I fully support what Will is doing, I hope to be working constructively with Will in the months and years ahead, should the election here in Tasmania go the way I hope. Isn't it good to see a candidate for the premiership who wants to work constructively with the national government rather than pick unnecessary fights with the national government? If we want to have a go ahead state as part of a go ahead nation, we need Federal and State Governments working with each other, not against each other. QUESTION:

Prime Minister, you were in the same position as Will Hodgman just a few months ago. A red hot favourite heading into an election - what advice do you have for Will on winning the last two weeks of the campaign like you did in September? PRIME MINISTER: Will is not taking anything for granted and certainly I didn't take anything for granted and the Liberal Party takes nothing for granted here. This is a very close race. It's particularly difficult because of the Hare-Clark voting system. I think that the people of Tasmania know that the last thing they need is 16 years of this government. That's what Lara Giddings is asking for, 16 years of government which has basically closed this State down. Now, I love Tasmania's beautiful environment, I love Tasmania's clean reputation, the fact that these abalone here are so beautifully presented, are so pristine and perfect in a way that produce of almost no other place is. I really love that, but Tasmania has got to be an economy as well as a National Park and if the Labor/Green government has its way, it will be more of a National Park, less of an economy and that's not the future for this State. QUESTION: Has Will Hodgman spoken to you about how politically damaging it might be if the NBN isn’t rolled out fibre to the home down here? PRIME MINISTER: What Will and I have discussed is the importance of actually getting the NBN happening. Let's not forget for a second that the former Labor/Green government in Canberra because of its utter incompetence and ineptitude stopped the rollout. The NBN rollout in Tasmania stopped in July and it was not going to start again had that government been re-elected. It has started again, because Malcolm Turnbull has got it going. I give this guarantee - under the Coalition we will get the NBN going again and we will roll out the NBN past more houses in the next 12 months than Labor managed in the last five years. QUESTION: But how receptive has the Federal Government been to Will Hodgman’s argument that we should have fibre to the premise everywhere in Tasmania. Is that something that you will consider doing given the pressure from people like Will Hodgman? PRIME MINISTER: The NBN will be rolled out throughout Tasmania, you'll get faster, more affordable broadband, more quickly under the Coalition. The interesting development this week is the discussions between Will Hodgman and Minister Turnbull and I am confident that we can have a trial of overhead rollout of the NBN to see whether that's a faster more affordable, more feasible way of doing it. QUESTION: Why did Liberal Senators then and candidates tell us before the federal election who would get full fibre to the home rollout? PRIME MINISTER: The important thing is that the NBN will be delivered here in Tasmania. That's the point I want to make. The NBN will be delivered here in Tasmania and over the next 12 months under the Coalition you will get more homes and premises passed in 12 months than Labor did in the last five years. QUESTION: Why do we need a trial on the Aurora rollout given that it was used in stage one. We’ve already actually done this in some places like Midway Point. Why do you need another trial? PRIME MINISTER: Can I just make the general point and I think we've had a good go on this issue and we'll go on to other issues if you don't mind, but I just want to make the general point - are going to get the NBN faster by having a fight with the Federal Government or are you going to get the NBN faster by working with the Federal Government? Now, Will Hodgman has proved, even as Opposition Leader, that he can work with the Federal Government. Lara Giddings is boasting about the fact that she wants to fight with the Federal Government. If you want to get things done, you've got to work cooperatively with people and that's what will happen if Will Hodgman becomes Premier of Tasmania. I'm not looking for a fight with anyone, but it seems that the current Premier wants to pick a fight with me and is saying re-elect me so that I can fight with Canberra. If you want things done, if you want to go ahead as a State and as a nation let's have the State Government and the Commonwealth Government working together. QUESTION: Do you accept that it’s a broken promise to no longer commit to full fibre to the premises rollout given what was said by Liberal Party candidates and members before the election? PRIME MINISTER: Are there any other subjects people want to ask questions about? QUESTION: There are, but that’s a pretty straight forward question.

PRIME MINISTER: We’ll come back to that one. Are there any other subjects people want to ask questions about? QUESTION: Do you have concerns about the AFP raids on Channel Seven this week? Did they get it wrong? PRIME MINISTER: Look, what happened with the AFP and Channel Seven was an operational policing matter and operational policing matters are a matter for the AFP, they're entirely at arm’s length from government. Now, it does seem that there are some issues and my understanding is that the Attorney has issued a polite please explain to the AFP, but the actual matter itself was an operational policing matter. Entirely at arm's length from government and that's as it should be. QUESTION: Was it appropriate that the police were armed? PRIME MINISTER: Again, operational policing is entirely a matter for the AFP. QUESTION: Has the Government handed over Cabinet documents to the pink batts Royal Commission? PRIME MINISTER: We've established a Royal Commission because we want to get to the bottom of the most incompetently managed programme in Australia's history. Can any of you think of a government programme that actually killed people? Let's not forget that this programme was so incompetently devised and carried out that it resulted in four deaths, hundreds of house fires, a billion or so was spent putting insulation in and then a billion or so was spent taking insulation out. An absolute monumental act of ineptitude. Now, it's very important that we get to the bottom of how this happened and why this happened so that we can learn the lessons and make sure that nothing like this ever happens again. What is actually required and who is actually going to be interviewed, will be a matter for the Royal Commissioner. If the Royal Commissioner asks for documents, that's a matter for the Royal Commissioner. QUESTION: Do you think that would set a dangerous precedent for the future though, if you did hand over those Cabinet documents? PRIME MINISTER: Well, it's not a question of us handing over the Cabinet documents, Royal Commissioners are entitled to ask and to indeed be supplied with documents. Royal Commissioners have very extensive powers to demand documents, to summon and question witnesses. This is a very powerful inquiry and it should do its job. QUESTION: There have been calls for a royal commission into the asylum policy. One could argue that that’s a government policy that’s resulted in loss of life. PRIME MINISTER: There is an inquiry going on into what’s happened in Manus. We’ve got General Campbell up there at the moment, so that we know exactly what’s happened. The Papua New Guinea authorities will have their own inquiries into what happened. The important thing is that we protect our borders, we implement our policies and we maintain order in these camps and I'm pleased to say that despite a very serious riot, the camp was fully functional the next morning, people were being fed, people were being housed, people were being looked after and our obligations were being discharged. QUESTION: Can I ask another question about the State election? You mentioned Hare-Clark being difficult - do you think it’ foolish that Will Hodgman rules out governing in anyway other than a majority given how well a Coalition work in Canberra? PRIME MINISTER: Well, we have a very stable Coalition between the Liberal Party and the National Party in Canberra. There is no comparable National Party here in Tasmania that has a Coalition agreement with the Liberal Party, so what happens in Canberra is on our side of politics is sui generis if you like. The important thing is that we have a strong and stable government here in Tasmania and the only way to have a strong and stable government is to vote for Will Hodgman and the Liberals. If you want a Labor/Green circus or a Green/Labor circus vote for someone other than the Liberals. If you want a strong and stable government, here in Tasmania, the only way to get it is to vote for Will Hodgman and the Liberals. QUESTION: What’s your response to the news that there could be 6000 jobs lost at Qantas? PRIME MINISTER:

Well, it's not news, it's just speculation. Qantas is a very important iconic Australian business and I want Qantas to flourish. But like every other private business, Qantas has got to put its house in order and I think it's important that it does so. There are plenty of signs that Qantas is serious about putting its house in order and I'd encourage them to get on with that particular job. Now, I’ll just go back to that question that you asked and this is the final answer I'll give. Look, we will keep our commitments, we will keep all of our commitments because I want to lead a Government which is competent and trustworthy. The essence of political trustworthiness is to keep your commitments, so all of the commitments that we made pre-election will be kept. Thank you. [ends] I have come across many farmers getting money at best 7 per cent or up to 8 per cent and into 9 per cent. So, let's say 8 per cent and we're offering them a million dollars at 4 per cent and if they just use it for the purpose merely of restructuring - that's going to be a $40,000 a year advantage to them and over five years that's $200,000. I tell you what; if you drop $200,000 in the pub on a Friday night you'll bend down and pick it up. What I can be absolutely certain about is this is a real benefit to them. What's more, and the beauty of this, is that obviously the Commonwealth borrows the money cheaper than 4 per cent - so, it’s not the cost to us. QUESTION: Prime Minister, obviously many of these farmers are in terribly dire circumstances. What happens if at the end of the five years they can't make good on their loans? PRIME MINISTER: If they can't make good on this loan, almost certainly they won't be able to make good on other loans and they will be unviable. So, we'll have to have the normal consequences but these concessional loans are going to be administered by the adjustment authorities that the states have, invariably in conjunction with the banks. That's why I think this is economically responsible, very economically responsible, as well as a fair go for drought-hit farmers. QUESTION: The weather bureau's predicting a dry autumn, particularly across central and western Queensland. Are you prepared to dip into the Budget, yet again, to fund another drought package if it extends longer? And just related to that, what is the quantum of money in terms of the extra spending out of the Budget from this $300 million package? PRIME MINISTER: It's a $320 million package at one level because there's an extra $280 million worth of loans in the capital account and there's $40 million of spend in the current account. Look, this is a response to the current drought at the current time. If circumstances dramatically change, obviously the Government will respond further. We think this is a significant and timely response to the existing crisis. If we get new difficulties, well, obviously we'll adjust them because the job of Government is to respond intelligently to the developments of the day and that's what I would hope to do at all times. QUESTION: Isn't that a Band-Aid approach? PRIME MINISTER: It's the best approach that we can have. I should also remind people that there is an agriculture white paper - the preparation has begun. We'll have that white paper by the end of the year and one of the issues that will be considered by that white paper is what improvements might be made to drought assistance over the very long-term. AGRICULTURE MINISTER: Let's not confuse the two issues of the here and now with what our Government is also doing which is long-term planning for the agricultural sector in the white paper. Really, once we start talk about the hypothetical of what happens if it doesn't rain, well what happens if it rains too much - we are to govern for the here and now. Our first iteration was a drought package, that was the first thing I brought into the Cabinet. This is the next iteration. We're dealing with the circumstances that are before us and I think it is a bridge too far to say what if another event may occur. QUESTION: Prime Minister, how many people do you think this package is going to help? Just getting back to Michelle's point - there is real consternation in the farming community that some farmers who have adjusted their businesses before the drought are doing ok might be propping up those farmers who were in economic trouble before the drought hit. You would have, in effect, become the ATM of last resort for those farmers. PRIME MINISTER: There's a sense in which those of us who are doing well are always helping those of us who are doing less well. The whole principle of a social security system, the whole principle of a progressive tax system relies on those who can afford it helping those who can't afford it. So, this is inevitable in any needs-based system. In terms of

the greater access to income support, it's a demand-driven system but our anticipation is that this will help thousands. In terms of the concessional loans, our anticipation is that will help hundreds of businesses. QUESTION: Prime Minister, on the interim farm household allowance, you say it will be subject to a different asset test than say, Newstart, for example. Are you waiving any asset test whatsoever? Can you explain how that works? PRIME MINISTER: No, we're not. There will be the normal income and assets test except for this, you can have up to $2.55 million in net farm assets and still access income support. QUESTION: Prime Minister, just to clarify, the $280 million of concessional loans, is that, over time, actually going to be revenue neutral for the Budget? Secondly, if a business in a position such as SPC were to come to you and request a concessional loan at 4 per cent, would the Government consider that request? PRIME MINISTER: It's on the capital account in the same way, I guess, on a much larger scale the NBN was on the capital account and whether it ever comes on to the income account depends upon how it goes and if this scheme is well administered, as I expect it will be, it should stay on the capital account. The fundamental difference, if I may say so, James, between what SPC came to us with and, well, there are two fundamental differences between SPC and this. The first is that SPC came to us asking us for $25 million in the normal course of business. Drought of this severity is not the normal course of business. This is not just a once-in-a-decade drought. It's a once-in-a-quarter-century drought in many places. In some places, it's a once-in-a-century drought. That's the first difference. The other difference is - and I don't really want to harp on this - but SPC's parent company was one of the most profitable companies in our country. I mean, SPC's parent, Coca-Cola Amatil, made $215 million in after-tax profit in the last six months. So, if I may say so, there was a certain amount of cheek in coming to the Government and saying, "give us 25 million bucks," when the parent company's balance sheet is stronger than that of the Commonwealth of Australia - given what the former government did to the Commonwealth's balance sheet. AGRICULTURE MINISTER: Can I add something to that, because it's really important? The administering agencies do this on a needs basis and I'm sure that if you presented and said, "I'm worth about $7 billion and I made a half-billion profit last year," I don't think you're going to tick the box on the needs basis. QUESTION: Mr Abbott, is this response an admission that the Coalition failed to take adequate drought policy to the election? Are you concerned by that given the warnings that were delivered to Canberra about the drought as far back as May last year with Queensland cattlemen? And Minister Joyce, just another question for you, in terms of the states, what contact have you had with the states because Minister Ludwig failed to do that when he originally announced this farm finance package. PRIME MINISTER: Well, if I could begin, what we've done is we have brought forward - well, there's five elements to this package, but one of the elements, a very significant element, is the bringing forward of the arrangements that were agreed by the former government and the states early last year and they were essentially bipartisan arrangements. So, given the circumstances that applied in the middle of last year, we thought that was a good arrangement. Given the circumstance that now applies, we think it was necessary to bring it forward and that's why these new income support arrangements will be available to people from Monday. Now, Barnaby is nothing if not a vigorous and active Minister and as soon as this matter was concluded by Cabinet last night he was in touch with the states and Barnaby has been having preliminary discussions with different people in different states for some time now. AGRICULTURE MINISTER: Thank you very much. As soon as this got through Cabinet I informed Minister McVeigh in Queensland and Minister Katrina Hodgkinson. I also was in discussions with the NFF. It's about the process of making sure this mechanism hits the ground running and we have the capacity to do that. As far as a drought policy goes, we can't be responsible for what the other government didn't do. We can only do what we're doing. Might I say that the first thing we did as soon as we came to Government was to deal with the issue of drought, and to hope and pray for rain. We started moving tens of millions of dollars into the drought affected areas through the farm finance scheme and also got a water package out. Now, this is the next iteration of that. It shows that we are actively managing the issue as it goes. QUESTION: Will the money be distributed amongst the States like you did last time with more in Queensland and New South Wales, less in other States? AGRICULTURE MINISTER:

Colin, it will be distributed on a needs basis and quite obviously where the need is is where the drought is and we have seen both New South Wales, Queensland also in Southern Cross in Western Australia, around that area, we also have it down in South Australia in the northeast of South Australia, this is not a scheme that abides by lines on a map; it abides by needs and how those needs are addressed. QUESTION: Why is it only in Queensland and New South Wales that are eligible for the funding for the water infrastructure? AGRICULTURE MINISTER: We have nominally allocated money to these areas, but we have also had money in reserve that can be allocated to other States. PRIME MINISTER: Ok, Phil, other subjects? QUESTION: Yeah on Qantas, Prime Minister, if I may. Ministers Truss and Hockey have confirmed you're looking to amend the Sale Act. Do you see it as an inevitable consequence of that Qantas would probably offshore, you know, 10,000 or so maintenance workers so they can compete? PRIME MINISTER: Phil, what Qantas does has got to be a decision for Qantas management. Government does not run airlines. It's a long, long time since government has run airlines and I don't believe that government should airlines. The Labor Party used to believe that government shouldn't run airlines. I don't know what their current belief is, but certainly they used to believe that governments shouldn't run airlines so what Qantas does is a matter for Qantas management and we want to ensure that Qantas management, as far as is humanly possible, don’t have any government-imposed ball and chain around their ankles and that's the problem with the Sale Act: it is a significant restriction on Qantas’ freedom of maneuvre and that's why the Government is considering legislation to establish a level playing field in this area. Mark? QUESTION: A couple of questions about this situation with Senator Nash. You told the House of Representatives that her Chief of Staff had been dilatory, I think was your word. She said today he did nothing wrong and that he’d offered his resignation. She also wouldn’t say whether she had offered her resignation to you or anyone in your office. Can you just clear up for us - was he dilatory? And did Senator Nash offer her resignation to you or anyone in your office? PRIME MINISTER: Mark, look, I know whenever there’s any suggestion of someone doing something that maybe they shouldn’t have, or someone having a role that maybe they shouldn’t have, everyone hyperventilates about who said what to whom and when and who knew what and when. If I may say so, this is a fairly minor case. All the decisions that Senator Nash has made are eminently justifiable and I support them and whatever the issues in respect of the staffer in question, they have been resolved by his resignation and the matter is now at an end. QUESTION: Did she offer her resignation, Prime Minister? PRIME MINISTER: Look, the short answer is I had no such conversation with her, and this matter is at an end. I know that the Labor Party is huffing and puffing in the Senate today and I absolutely accept that the conflict of interest rules are important and they need to be adhered to and within a couple of days of the slightest suspicion that there was a problem or that there might have been a problem, the gentleman in question resigned and was gone and without wanting to make too much of a meal of this, I’d ask you to compare the way this Government has dealt with this, with the way the former government dealt with the scandal involving the former Member for Dobell who was - let’s face it - protected for three years. QUESTION: Prime Minister, on Qantas, you've said you don't want to put another ball and chain on the airline, but if the airline gets some sort of support from the Government, perhaps a debt guarantee or whatever you may do down the track, is it then fair, if you've given them a help up, for the Government to impose conditions, perhaps around jobs that you can't move jobs overseas, and what do you say to some people in your own party who believe Qantas has been mismanaged and they should have a management change? Do you have confidence in Qantas management? PRIME MINISTER: Phil, it's not for me to express a view about the management of a company. It's up to the shareholders to be confident in the management of a company. Now I know that the Labor Party is trying to say that there's a secret deal between the Government and Qantas under which we'll do something in return for Qantas doing something. Well, there is no such deal. We would never enter into any such arrangement and whatever Qantas does is entirely a matter for the management of Qantas. QUESTION:

When you say, then, that you expect Qantas say to get its house in order, it sounds like you're saying they should do that before the Government makes changes. What do you mean by that? And just on one other subject, we heard that Prime Minister O'Neill of Papua New Guinea had said to you he was still committed to resettling asylum seekers there. Can you tell us did he say that he was still committed to resettling all of the people found to be refugees on Manus Island and did he give you any explanation of how or where? PRIME MINISTER: Well, you’re asking two lengthy questions and the danger is that I will forget the first question in the process of answering the second question… QUESTION: The first one was about Qantas. PRIME MINISTER: Yes, and I think I've already forgotten it! Just on the O'Neill question - Prime Minister O'Neill, whose friendship and cooperation I appreciate and Australia appreciates, has told me that he is fully committed to the arrangement that was made between PNG and Australia in the time of the former government. Now just repeat that Qantas question, Lenore? QUESTION: When you say "get their house in order," what do you mean? PRIME MINISTER: Yes, I was making a general observation which I would make of any company which is facing a difficult market environment. It's up to the management of the company to deal with the company's situation. It is not the business of government to make management decisions for companies. It is the business of management to make management decisions for companies. It is the business of government to try to ensure that companies are operating in the best possible environment and in the case of Qantas we can start by scrapping the carbon tax because, as all of you, I hope, know, the Qantas carbon tax bill was $106 million. Now, ok, in a business like Qantas $106 million is only one element of the environment in which it faces, but I tell you what, to have $106 million extra in your pocket is a pretty, pretty important benefit in tough times and again I say to the Leader of the Opposition, if he's fair dinkum about wanting to look after Qantas, he can start with letting the carbon tax repeal bill go through. QUESTION: Prime Minister, do you think that the national attachment to Qantas, the sentimental attachment as both the national carrier and a national symbol, has diminished significantly since the Sale Act was passed? I mean, are Australians more prepared to see greater foreign ownership of the airline now? PRIME MINISTER: Well, look, I don't want to speculate on what's going on inside people's heads and inside their hearts, but we know that something like 25 per cent of Australians travel overseas on Qantas and that means that something like 75 per cent of us travel overseas on other airlines. We know that the percentage of Australians buying cars made in Australia has dropped and dropped and dropped, despite the fact that many of us remain sentimentally attached to Holden or to Ford. So, look, in the end, the job of government is to do what we can to enable all Australian businesses - iconic or not so iconic, as the case may be - to flourish. That's our business: to make it easier for business to do its business and, look, sometimes iconic businesses get into trouble. Our hope is that over the years we'll keep our old icons, sure, but over the years we might gain some new ones as well. Thanks so much.