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Transcript of interview with Kieran Gilbert: Sky News AM Agenda: 14 September 2009: Nielsen Poll on stimulus spending; global recession; Mid Year Economic and Fiscal Outlook; private health insurance and double dissolution trigger; Climate Institute report; Gorgon gas deals; carbon capture and storage; WorkChoices; Paul Keating comments.

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The Hon. Tony Burke MP

Minister for Agriculture, Fisheries and Forestry

Tony Burke - interview with Kieran Gilbert, Sky News AM Agenda

14 September 2009

Minister for Agriculture, Fisheries and Forestry Tony Burke Member for Moncrieff, Steven Ciobo Sky News AM Agenda, Kieran Gilbert

Subjects: Nielsen Poll on stimulus spending; global recession; Mid Year Economic and Fiscal Outlook; private health insurance and double dissolution trigger; Climate Institute report; Gorgon gas deals; carbon capture and storage; WorkChoices; Paul Keating comments.


KIERAN GILBERT: Good morning and welcome to AM Agenda. A new opinion poll shows the Government’s handling of the economic crisis is getting the tick of approval so far. But more than 40% of those surveyed in today’s Nielsen Poll think that the Government should either stop or wind back its stimulus spending. Joining me on the program this morning to discuss this and the other matters of the day, the Agriculture Minister, Tony Burke and Shadow Small Business Minister, Steve Ciobo. Gentlemen, good morning to you both.

TONY BURKE: Good morning Kieran.

STEVE CIOBO: Good morning.

KIERAN GILBERT: Tony, first to you. More than 40% of people in the Nielsen Poll aren’t happy with your approach or at least want you to wind back and stop the spending. So while you’ve got some support there, there’s a fair whack of people who want you to stop.

TONY BURKE: Well you’ve heard us say before that, yes we are doing well and we are doing better than any of the other advanced nations in the world. But at the same time, as you’ve heard us say before, we are not out of the woods yet. For people who would like to believe that the sense of economic crisis around the world is a thing of the past - we are not at that point yet.

The stimulus package went in three stages and we’ve got to work through all three. You have the immediate fiscal stimulus component. You then have the shovel-ready projects and then you also have to invest in long-term infrastructure. When you go through all three of those, that’s how you get your path to long-term recovery.

KIERAN GILBERT: Why isn’t that number higher then? How come 40% of people haven’t been convinced just yet, I mean that’s a fairly sizeable number right there.

TONY BURKE: Well I’m not going to reflect on individual polls. There’s no doubt though that there is a sense in Australia as to how well things are going that’s not matched by some of the issues being dealt with around the world. That’s because of the effect of the stimulus - that’s because it has been working. The fact that something has been working doesn’t mean that it’s time to end it.

KIERAN GILBERT: Steve, we’ve been talking about one side of the debate, but on the other side of the equation, 59% have given the Government the thumbs up. So it seems that you and your colleagues are in the minority.

STEVE CIOBO: Well Kieran, we’ve said from the outset that the position we took with respect to the stimulus, which was that the Labor Government was spending way too much money and spending it poorly, was never going to be popular. We knew that right from the beginning and we said that. But we did that because we knew it was the right thing to do. We have a very strong track record, 12 years in Government where we paid off all our debt, we brought unemployment down to a record 30 year low so we think we’ve got the runs on the board.

What we’ve said about the Labor Party, and I hear Tony talking about the three limbs of the way to misuse taxpayers’ money. The first one was to throw so much of it away that they were actually giving it to dead people and even in some cases, probably, pets through estates. The second is these so called shovel-ready projects where we see money being divvied out left, right, and centre to schools with one student who are about to be closed down. We’re now seeing other schools, for example, where they’re bypassing local planning laws and just saying we’ve got to get this project out there. I mean, what we’ve got on a grand scale is a Government that is throwing money away like there’s no tomorrow and that’s the reason why Australians are going to end up $300 billion in debt and why it’s going to take Australians 20 or 30 years to pay off that debt.

KIERAN GILBERT: Yeah, but that’s your calculation for the moment but reports on the weekend are suggesting that, given the success of the stimulus, the size of the debt and the deficit could be wound back by about a third because of the strength of the economy. But this is going to hamper your argument isn’t it?

STEVE CIOBO: No, not at all. The point that we would make is that this Government is already $100 billion in debt. They are borrowing over one billion dollars a week. Now the point that I would simply make to the Australian people is it took us 12 years to pay off Labor’s debt last time so while Kevin Rudd and Wayne Swan, and people like Tony, are dancing around the electorate pretending that they’re wonderful people because they’re handing out cheques left, right, and centre - the reality is that we’re all going to get the bill and that bill is mounting as we speak. Soon the party will be finished and everyone will be left to pay that bill and that is going to take decades to pay. Now whether its $100 billion or $300 billion, it’s going to take an awful long time to pay it.

TONY BURKE: But Steve, what you’re failing to recognise is: what was the cost of doing nothing? And without the stimulus package, for the last quarter, we would have gone backwards by 0.3% and we would have gone backwards over the previous year by 1.3%. We are the only country in the world that is doing this well. We have the highest growth figures, the second lowest unemployment, the lowest debt, the lowest deficit.

STEVE CIOBO: No thanks to your Government.

TONY BURKE: If you think the stimulus package should have been smaller, put a dollar figure on it.

STEVE CIOBO: We’ve already indicated, Kieran, we put forward an alternative plan right from the get-go, that would have still provided stimulus to the Australian community which we said we supported. But not Labor’s way and certainly not the amount of money that Labor is spending. See, Tony, what you fail to admit and what the Labor Party fails to admit is that one of the biggest drivers of the reason why the Australian economy is doing well is we’ve had the biggest fall in monetary policy. Interest rates have come right down and that has provided a massive stimulus to the Australian economy, much more than the way in which Labor is wasting money left, right and centre.

KIERAN GILBERT: But the consumer spending in the June quarter was up 0.8% and interest rates are normally seen as having a lagging impact in terms of spending.

STEVE CIOBO: But if you are paying off a mortgage then your interest rates have fallen 3-4% or something like that, you’re going to have much more disposable income and that is what is driving

this increased confidence out there in the community. It’s not that the Labor Party is out there giving away the next two decades-worth of money for the Australian people, that’s not what’s driving it. That had a short, sugar-hit effect but the real key here, the real long-term pathway to economic recovery for this nation lies in the fact that we get those parameters right and we help them build forward from there.

KIERAN GILBERT: Tony, I want to ask you about that issue of the level of debt and deficit. Now, if in the mid-year economic forecast that is out in a few weeks, if that does wind back the projected debt and deficit by a third as was reported on the weekend - is the Government confident of that? Is that why the Government is not going to wind back the stimulus? Because you know you’re going to get that windfall anyway?

TONY BURKE: Well, we’ll wait until we see MYEFO, the mid-year economic forecast, before we start entering into commenting on it. The comment that Steve made about interest rates being the only thing to take into account in terms of the recovery is just wrong. Go to the person who has been in charge of the interest rate part of the policy: the Governor of the Reserve Bank. When he has appeared before the Parliamentary Committees there have been attempts to get him to say, “Well, isn’t it this and not the stimulus package?’ He sees the total packages as part of the story. So even the person responsible for what Steve is wanting to give credit to as the whole economic story reckons you’re wrong.

STEVE CIOBO: Actually, Tony, the reality is that it’s the Labor Party who says that the whole reason is their stimulus. What the Coalition’s position is that it’s the stimulus and interest rates but that your stimulus is too much. So we’re actually the ones that are saying it’s the stimulus and interest rate policy. It’s only the Labor Party that swan around the electorate and say, ‘This is all due to our stimulus, that’s all it is, if it wasn’t for us, if it wasn’t for the Labor Party spending the next two generations-worth of money we’d all be in dire straights.”

TONY BURKE: Sorry but misrepresentation on that scale…Just quickly, you gave the schools example as one where there is massive waste: 24,000 projects, 49 complaints.

STEVE CIOBO: A $1.6 billion blow-out.

TONY BURKE: And all the extra money was internally funded through other parts of the stimulus package so there is no extra impact on the bottom line.

STEVE CIOBO: So what were you using that money for then? If you can make $1.6 billion and it means nothing, what was it being spent on?

TONY BURKE: We ended up undersubscribed on the social housing money because we were able to get more houses by using renovation instead of just construction. Those are the figures publicly, and you know that.

KIERAN GILBERT: Let’s move on to another issue, a related issue in that the Government accuses the Coalition of blowing a $2 billion black hole into the budget that relates to the means testing of the private health insurance rebate. Nicola Roxon was on the ABC yesterday, I want to recap a little bit of what she said in relation to reintroducing this bill.

NICOLA ROXON: We’re not looking for a double-dissolution trigger, we’re looking to get the measure passed. We believe this is a sensible measure but I am not afraid about arguing to the public that secretaries, and nurses, and taxi drivers shouldn’t actually have to pay for my health insurance or a millionaire’s health insurance or Mr Turnbull’s health insurance. There isn’t a lot of logic to that.

KIERAN GILBERT: Nicola Roxon on the ABC. Tony, it seems that the Senate would have to vote to return in December. That’s looking very unlikely given that the cross-benchers wouldn’t back that anyway. What was Nicola Roxon on about yesterday?

TONY BURKE: Well Nicola is referring to the fact that we have sought advice on recalling and we’ll work through that advice. The bottom line is, we talk about debt and deficit - if this doesn’t get

through there will be a $2 billion hole in this year’s budget. A $9 billion hole over the next decade. This is an important measure to get through. It’s part of reacting to what has happened with the global recession. It did mean priorities needed to be looked at again and the Opposition wants to pretend that there is no global recession, there’s no need to look at priorities again and they just want to ignore this.

KIERAN GILBERT: Would you be willing to fight and allow a double dissolution trigger, for the Government to have in the back pocket, on this issue.

STEVE CIOBO: Well Kieran, let’s be clear about what’s happening here and I’ve scratched my head, I wonder how people take the Labor Party seriously sometimes. They say we’re blowing a $1.9 billion hole in the budget - completely false. What we’re trying to do is hold the Labor Government accountable. They put their hands on their heart and promised that they wouldn’t fiddle with private health insurance, now they’re trying to fiddle with it. So what we did was the responsible thing, we put forward a way to completely and totally offset the impact this will have on the budget. It’s only Labor, in their arrogance, that is refusing to accept our offset measures.

KIERAN GILBERT: Would you vote against it again?

STEVE CIOBO: Well, we’ll need to cross that…

KIERAN GILBERT: Would you risk an early election?

STEVE CIOBO: What we need to have happened Kieran, we need this Government to get engaged, to stop acting like some kind of arrogant dictator and to start working with the citizens in the community and in the Senate.

TONY BURKE: You’re not at the party conference now.

STEVE CIOBO: Well this is what’s going on. We’ve put forward a way to completely offset these measures and Nicola Roxon is walking around, and Kevin Rudd is walking around, head in the air refusing to even talk about it. So there’s no need to have any impact on the budget. Do something, get on board with this, make it better and stick by your election promise most importantly.

TONY BURKE: Well in terms of the election promise that you raised, let’s not forget a $115 billion write-down in revenue because of the global recession.

STEVE CIOBO: I thought things weren’t that bad? What’s going on?

TONY BURKE: That was before there was any action from the Government. That was an immediate write-down in revenue over the Forward Estimates because of the global recession. In that context, responsibly, you have to look at your priorities again. The alternative is to say, “Well, two years ago this is how we said it would be, the entire global economy has changed, but we’re not going to change a thing.” Surely, you can’t be recommending we do that.

KIERAN GILBERT: Gentlemen, we’re going to take a quick break. Stay with us on AM Agenda.


KIERAN GILBERT: Welcome back to AM Agenda. With me, Steve Ciobo and Tony Burke. Tony Burke, first to you, in relation to this report on climate change. It’s in the lead-up to the G20 Leaders Summit next week - Australia is ranked 15th in its ability to compete in a low-carbon economy. That’s the worst of all the advanced economies in the G20.

TONY BURKE: We’re ranked ahead of Indonesia and Saudi Arabia but everybody else we’re behind. So in terms of a big signal as to whether we ready to take advantage of the low pollution, low carbon jobs of the future: you will not get a stronger argument than this as to why we need a price on carbon in the economy.

The rest of the world is moving. There are significant opportunities for the countries that get in early. For us to be ranked so far behind the pack says that if there were a time for an argument on the need for us to act to put a price on carbon into the economy, it’s this.

KIERAN GILBERT: Doesn’t that show how big the impact is going to be on the bottom line in this economy given that it is going to be such a major shift of focus?

TONY BURKE: Well there is a shift, that’s why you have the system where things are being phased in. That’s why you start with the $10 price of carbon for the first 12 months. These issues have been taken into account. We need to get the legislation through, to get the Carbon Pollution Reduction Scheme into law so that Australia can finally start taking action. If this had happened years ago, we’d be in a much stronger position now.

KIERAN GILBERT: Steve Ciobo, is that a fair point? Fifteenth out of 20, the worst of the wealthy nations at the G20 it’s really not a good starting point.

STEVE CIOBO: I think what it reflects is Australia’s traditional base and that is that we’ve been exporters of energy.

KIERAN GILBERT: But we’ve got to act to try and shift the base.

STEVE CIOBO: The key is this Kieran, we generate about 1.4% of global emissions. So this headlong rush for Australia to develop its own framework and be the first in the world, so that guys like Tony and Kevin Rudd can feel good about themselves, is really not the best way forward. What we need to do is actually recognise that we only account for 1.4% of global emissions. At the same time the bulk of this nation’s prosperity comes from the fact that we are a cheap energy source and export to the world. So what we need to do is be part of a global agreement, because there is only one solution and that is a global solution. There’s no notion that we will just do it here in Australia and the rest will follow, we’ve got to be part of that fabric that’s happening across the globe. But at the same time we need to keep pushing forward and generating export income. I note that in the same breathless way that the Labor Party says, “Hang on we’re too far down in the league table we need to be up higher,” they’re happy to increase the number of emissions because we just had the big Gorgon deal. We support the Gorgon deal but there seems to be a little bit of incongruity between the two there.

TONY BURKE: With gas?

STEVE CIOBO: With respect to Gorgon, which is actually going to increase our carbon footprint. That’s right, isn’t it?

TONY BURKE: Yes but you’re talking about a lower emissions form of energy.

STEVE CIOBO: You are still increasing Australia’s total carbon footprint and this is our point, that this is a good source of export income for us and we need to keep exploring and generating those new export fields but at the same time we need to be part of that global agreement.

TONY BURKE: Well first of all, the claim that Australia would be the first in the world is just wrong. There is no end of European nations that would be shocked that someone would claim they hadn’t had an emissions trading scheme in place for years. You know they have and to claim that we would be the first in the world is a lie, it’s just not true.

STEVE CIOBO: Well that’s what Kevin Rudd would like. We know his particular bent on this Tony, he is very happy to strut the world stage and claim that he alone has been the one that has delivered us from the peril that comes with climate change.

TONY BURKE: We can’t have a policy discussion Steve if you’re just going to create characters and start imposing new ideas onto them. Essentially, what Australia needs to be able to do is be part of the low carbon economy of the future. We need to be acting - and we are far and away not the first in the world to be acting - but we have more at stake than most countries in the world

and we need to have a price on carbon in the economy. The Australian economy, including the energy sector, will be much better off into the future if we do that.

STEVE CIOBO: So how many jobs will you be prepared to see go as a result of your position?

TONY BURKE: Well this is the criticism that ignores the new low-carbon jobs of the future that become available.

STEVE CIOBO: Ok, so those coalminers should all get jobs in solar energy?

TONY BURKE: Well you’re presuming that CCS [Carbon Capture and Storage] technology is not something in which Australia has become the world leader, in terms of having the work done here, in having carbon capture and storage. The Australian Government is seen as the key government globally in advancing that technology and that provides an opportunity for coalminers to continue to be a significant part of our exports while still having a future in a low-carbon economy.

KIERAN GILBERT: Ok, a couple of quick issues to finish. Steve, the workplace debate back again. Malcolm Turnbull says he might back a reintroduction of individual contracts as part of Coalition policy. Does this give Julia Gillard and Labor a free kick, to say that you’re going to bring back WorkChoices?

STEVE CIOBO: Well Kieran, I don’t know how many times it can pass the lips of Opposition members but WorkChoices is dead. If we’ve said it once, we’ve said it a thousand times - WorkChoices is dead. The Labor Party is running the scare campaign that we’re somehow going to revive it, that’s just not the case. What we have indicated though is that flexibility in the workplace is crucial to growing Australia’s productivity and to generate wealth for the nation going forward. Now Labor’s new IR policy has only been in place for a couple of months now and we think it is going to be a big crimp on workplace flexibility. So what Malcolm indicated was that we would take a very explicit and clear policy to the next election and only those platforms with respect to industrial relations that were incorporated into that policy would be the areas that we would change.

KIERAN GILBERT: Well that’s fair enough isn’t it? If Malcolm Turnbull says it will be explicit, we’ll take it to the next election. Julia Gillard is pursuing a bit of a scare campaign here isn’t she?

TONY BURKE: Well they said it was dead and buried and then they pick up the shovel and start digging. Steve just said at the next election they expect WorkChoices to be back on the table but they’ll give it a new name. They’ll call it ‘Workplace Flexibility’, they’ll call it something different but the elements of what they are talking about will be the same issues, the same concept that was known as WorkChoices at the last election.

KIERAN GILBERT: Well, with employment going up shouldn’t there be more flexibility in the labour market?

TONY BURKE: I don’t think you give people job security by taking away their job protection.

STEVE CIOBO: What you do Kieran, Labor’s policy of course is to actually take away their job. So what we’re seeing, for example, with Labor’s pursuit of modern awards is that we’ve got massive business cost increases and we’ve got employer groups all over the country say, if these come in we will simply shed staff.

TONY BURKE: You would have more credibility talking about jobs if you didn’t have Joe Hockey saying that jobs were not the key priority and if you hadn’t opposed a stimulus package that is now supporting something in the order of 215,000 jobs.

STEVE CIOBO: And Tony, Labor would have more credibility on jobs if, like the Coalition, you brought unemployment down to a 30-year record low instead of doing what the Labor Party always does which is send unemployment up.

TONY BURKE: We’ve got the second-lowest unemployment out of the advanced economies.

STEVE CIOBO: No thanks to you, that was a legacy of the Coalition Government. We got it down to a 30-year low, you guys get back into office and in exactly the same way that you did in the early-80s and the mid-90s, what did you do? You’re driving unemployment up.

TONY BURKE: Apparently, we caused the global recession.

STEVE CIOBO: That’s right, you’re always the victims. The Labor Party is always the victim. Wrong place, wrong time.

KIERAN GILBERT: We’re almost out of time but there’s one issue I do want to get to and this related to comments by the former Prime Minister, Paul Keating on the weekend. He praised John Faulkner in the Australian newspaper on the weekend and said, “In many ways John is representative of old-school Labor where policy objectives and social passions provide the motive power. Whereas among the new class of professional politicians power and the pathway to getting it - polls, news management, election campaigns - is what turns them on.” I mean, who is he directing that at? Paul Keating has had a fair whack at, what it seems, the Rudd Government.

TONY BURKE: Paul’s comments about John Faulkner are right and John deserves the praise that is being given to him. In terms of how those of us who are coming through now are perceived, it is true we are dealing with a very different media cycle to what there used to be. Your station is part of what happened with the pace of the media cycle changing. In terms of the underlying passion, and I think in fairness it’s both sides of politics, the things that drive people to get involved in politics remains some pretty deep-set policy beliefs.

KIERAN GILBERT: So do you think he’s being unfair on that front?

TONY BURKE: Look, I don’t know anyone who gets particularly excited, and drives their career, around the mathematical fascination of a poll. You get involved in politics because you care about the nation and you care about issues. I think, as a nation, we’re pretty lucky on both sides about what drives people.

KIERAN GILBERT: Ok, well thank you for that response. Paul Keating, as always, very interesting with his analysis, but Tony Burke responding this morning, I appreciate it. Steve Ciobo, as always good to see you as well.