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Prime Minister discusses ACCC; petrol prices; medical insurance; Telstra; detention centres; and Denis Napthine.



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24 April 2002

TRANSCRIPT OF THE PRIME MINISTER THE HON JOHN HOWARD MP RADIO INTERVIEW WITH JON FAINE, 3LO

Subjects: ACCC; fuel prices; medical insurance; Telstra; detention centres; Denis Napthine.

E&OE………………………………………………………………………………………

FAINE:

Prime Minister, good morning.

PRIME MINISTER:

Good morning.

FAINE:

The raid conducted overnight by officers of the ACCC, Professor Fels’ outfit, against petrol companies. Do you support the action that he’s decided to take?

PRIME MINISTER:

I can’t make a judgement about the merits of it but I certainly support the ACCC carrying out what it regards as its legal obligations. I heard Professor Fels on AM this morning and he explained that they believe they have enough evidence to justify the investigation they have now launched. He pointed out that whether that materialises in any further

PRIME MINISTER

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action or prosecution or otherwise is something he doesn’t yet know. Clearly I support that. I’m not making a judgement though. I’m not asserting that the oil companies have been engaged in price fixing. I support the public interest in a matter of that kind being fully investigated. There is a clear public interest in that happening. But like all other citizens, corporate or otherwise, oil companies have certain rights and presumptions of innocence like everybody else. So let’s see how it plays out. But certainly there can be no criticism of the action of the ACCC thus far. It’s investigating the situation based on material it’s received, so let’s see how it unfolds.

FAINE:

Do you share the public’s frustration with the extraordinary coincidence that every petrol company and every retail outlet, 99.9% of them, magically put their prices up by the same amount, on the same day, and always before public holidays?

PRIME MINISTER:

Well not every outlet has the same price. I have to say I don’t agree with that. I mean I certainly agree with you that there is a lot of, I think Professor Fels called it this morning, parellelism in pricing, but equally I often experience driving through an area where the prices will vary quite a deal. But let’s see how it unfolds. Petrol pricing is a huge consumer issue in this country. It always has been, it always will be. We love our motor cars. We don’t like paying anything more than we have to. Let’s see what unfolds. But as I say at this stage I’m not pointing any fingers at anybody. That’s not appropriate. I don’t know the basis on which the investigation is being launched. The ACCC is independent of the Government in discharging its responsibilities. I can only assume it believes it has good reason and good cause to do what it is doing but let it unfold.

FAINE:

It’s a huge scandal by the ACCC in the event that you go to the length that they’ve gone to and as theatrical a gesture as this turns out to be with simultaneous raids, the biggest in its history in different cities, in different companies all at the same time. If you don’t deliver the goods what are you left with?

PRIME MINISTER:

Well we’re only an hour-and-a-half after receiving the news. What might be the attitude of the public if it doesn’t prove to be justified? I’m not going to get into that. Let’s assume as we should and must that the ACCC wouldn’t have done this without believing it had cause to do so and await the outcome. But in the meantime every organisation and individual in this country is entitled to a presumption of innocence and we can’t start pointing fingers.

FAINE:

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Indeed we shan’t. Simon Crean this morning on a television interview said he’d consider giving Alan Fels, the ACCC, more power to stop predatory pricing. Do you think he’s got adequate powers at the moment?

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PRIME MINISTER:

I think he’s got very good powers. There’s no evidence in front of me that he doesn’t have adequate powers. I mean you’d expect an opposition leader to make an opportunistic comment like that. Let’s see what comes out of this. This is the first time that the ACCC to my knowledge has launched an investigation of this scale on such an issue. I can’t believe it would have done it without believing it had grounds for doing so. In those circumstances let’s see what comes out of it before we start talking about giving the ACCC more powers or pretending it doesn’t have adequate power.

FAINE:

We’ll wait and see what comes out of the raids in particular. We learnt from the tobacco litigation recently that some multinational corporations have gone to extraordinary lengths to disguise their activities behind the scenes and to present one face to the public while doing another in fact internally. I wouldn’t expect after months of ads being placed in the paper from the ACCC seeking the whistleblower to return to the ACCC and provide them with more information. I wouldn’t imagine people leave work at any of these petrol companies with any documents just lying around on the desk. Would you?

PRIME MINISTER:

Well I’m not going to make a comment about that and in relation to the tobacco company that is the subject of an appeal and I don’t think I can say anything about that either, not that particular case. But the oil one, it’s a separate issue. Let’s not infer behaviour. I don’t think it is appropriate certainly that I….others may but I shouldn’t and I won’t.

FAINE:

But you heard Professor Fels on AM Prime Minister, you may also have heard the Chief Executive of the nation’s largest insurer of doctors saying that he’d written to you, he’s not satisfied with your reply about the impending collapse of the largest insurer of doctors in the country.

PRIME MINISTER:

Well I heard part of the interview. I may not have….I didn’t hear the tail end of it. But the bit I heard he didn’t acknowledge that the Government had already provided a guarantee of $35 million. The inference from the bit I heard was that the Government was totally indifferent. That’s inaccurate.

FAINE:

Mark McLeod says that you seem to be content to let United Medical Protection, the principal insurer of doctors in New South Wales, to go into liquidation or administration before assisting them. He says why won’t you do something….

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PRIME MINISTER:

Well I repeat he should have indicated if he’s being balanced that the Government already provided a guarantee of $35 million. It’s not the role of the government, I repeat, it’s not the role of the federal government or indeed it oughtn’t to be the role of the state government to prop up every commercial organisation that gets into difficulty. Now we did give what you could only call atypical, even unprecedented assistance to this organisation. Further assistance was sought in relation to the directors liability. For good reason the Cabinet felt it could not provide that further assistance. I indicated that to the organisation in reply to their request and I also indicated that the Government would not allow the doctors involved to be unprotected. Now I can’t say any more than that because decisions in a commercial environment and having regard to legal obligations must be made by directors and I don’t want to by my comments prejudice what they might decide to do.

FAINE:

Do you mean by that you don’t want them to think that they can just sit back and wait for the Government to just pump more…..?

PRIME MINISTER:

Well nobody occupying a director’s chair anywhere in Australia can sit back and assume that if they get into difficulty the Government’s going to bail them out.

FAINE:

That seems to be what this company is doing.

PRIME MINISTER:

Well I can only repeat what I’ve said. We have bent over backwards given the normal obligations of the Government to try and help and we felt we couldn’t go any further and it is not appropriate in my view to say the least for the inference to be made, or the allegation made, that this Government is indifferent to what happens with medical indemnity insurance. We are very concerned about it. We have done a lot of things to try and improve the situation and we are in the process of doing more. But as for this particular medical defence organisation I can only repeat what I said a moment ago that we did provide up to a $35 million guarantee. We were asked for more. We felt we couldn’t provide that but we are willing to take steps in the event of it being necessary to ensure that the doctors are not left unprotected.

FAINE:

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The doctors may not be left unprotected. What about the patients is the next issue. Prime Minister if indeed the Government proceeds to clean up I think is the phrase I heard being used yesterday, clean up the issue of doctors’ liability, does that mean you want to take away rights from patients to proceed against doctors who have conducted negligently?

PRIME MINISTER:

If I can talk generally, I mean not particularly about an individual organisation, part of the long term settlement of this issue is some scaling back of people’s expectations in relation to litigation not only against doctors but also against a lot of organisations. I think we have become far too litigious a society. I would hate to see this country go down the American path as far as litigation is concerned.

FAINE:

We already have. I don’t think we can help it.

PRIME MINISTER:

I don’t think we have already gone as far down that path as some think. But if we are not prepared to do something about it then there is no easy solution because you cannot have it both ways. You cannot have uncapped expectations about litigation and low premiums. You can’t. It’s just not possible and in the end something has got to give.

FAINE:

And everyone says well….

PRIME MINISTER:

I know they do but part of my job is to try and explain the longer term implications of that. It may not make me very popular with some of your listeners, it may not make me very popular with some of your lawyer listeners, but it stands to reason that if we have uncapped expectations turning into reality more and more about litigious opportunities then insurance premiums, not only in medical indemnity but elsewhere in the community, public liability and the like, those premiums are going to keep on going up and unless some other way is found of funding it then you’ve got a huge problem.

FAINE:

Is it about uncapped expectations or is it about rights, the rights that people have to be put back in a position they would have been in if they hadn’t been injured by ….

PRIME MINISTER:

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Well I understand that but rights also carry with them responsibilities and the responsibility, if the community is to have an unlimited right to sue then it has to accept the responsibility to pay for what that involves.

FAINE:

But it’s not an unlimited right at the moment. It’s very carefully limited by the courts.

PRIME MINISTER:

Well it’s unlimited in the sense that if you believe you have a claim for negligence there is no generic cap on what you might achieve.

FAINE:

But John Howard goes to consult the doctor over a sore throat and the doctor says here take some penicillin you’ll be right in a couple of days off you go. And instead it turns out they’ve missed some sort of cancer in your throat or something tragic which puts an end to your ability to pursue your political career, you want to sue, you want to pursue it to the fullest….

PRIME MINISTER:

Jon, I’m not suggesting that this is something that is capable of easy resolution. But we have to confront the reality. If people want the sort of rights that you described….

FAINE:

And they do.

PRIME MINISTER:

Hang on. But they also complain if the obstetrician is not available in the country town. The doctor, the obstetrician says I’m not going to practice there unless I can get insurance cover because somebody might sue me and the insurance cover is so high that it’s not worth my while financially to practice there. How are you going to get the doctor into the country town. One way of getting the doctor into the country town is of course some kind of public subsidy to get the doctor to go there but that involves an extra cost on the community, not the government. So I go back to my original point that something has got to give, that we have to face this issue as a community. If we want the sort of right you describe to be freely available without limitation or without serious limitation, if we decide as a community to do that then we have to accept that doctors have got to cover themselves and we have to accept that there’s going to be an additional cost involved in that which is going to be covered and carried by the community. Now what I’m trying to do is to get people to face the reality and the difficulty of this. But it is not possible to solve this issue while fully preserving an unlimited right to sue; there being no serious

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increase in premiums; there being a free availability of doctors whenever and wherever you want them. I mean it’s just not possible to do that and I think it’s very important that we all understand this and we all come to terms with it.

FAINE:

So what do you think we can do without, compensation for future lost earnings, or compensation for….

PRIME MINISTER:

Like all of these things….

FAINE:

Which bits do you see dropping off….?

PRIME MINISTER:

I don’t think it’s ever a situation of one thing disappearing altogether. Nobody’s arguing that. I think like all of these things you need to move towards some kind of compromise and….

FAINE:

Yes. I’m trying to get an idea of where you think, what rights we might lose?

PRIME MINISTER:

Well it’s not a question of, I mean you talk about the rights. You see what about the right to have a doctor readily available in your country town if you badly need it. That right is just as precious to somebody,…..

FAINE:

Yep, couldn’t agree with you more.

PRIME MINISTER:

…..even more precious than the right to sue. Now that right is being attacked, that right is being undermined, that right is being taken away at the present time. So when people talk about the right to sue, let me put my hand up for the right of a woman in a country town to have a baby in her country town without having to go miles away and to have that in relatively risk free circumstances. I mean that is a right too and a pretty fundamental right. So when you’re talking about rights….

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FAINE:

There’s a whole lot of them, they’re competing rights.

PRIME MINISTER:

Yeah they are. Like all issues where you have competing rights you have to have some kind of midpoint and out of this debate I hope we do get that midpoint but you won’t get that midpoint if people imagine that you can have the unlimited right to sue, you can have the doctor whenever you want it, and the doctors can afford to do so because the premium remains modest. There’s a breaking point and we’ve reached it and we’ve got to try and find a way through.

FAINE:

Prime Minister, Cabinet according to all the newspaper reports at length debated Telstra last Monday at its most recent meeting. You’ve come up with one option out of four apparently that were offered to you on how to move forward in the deregulated telecommunications market. According to the various analysts in the press this morning you’ve struck a deal that makes life tougher for Telstra in order to protect the smaller telecommunications companies. Why did you strike that solution?

PRIME MINISTER:

Well I’d like Senator Alston to have a bit more to say about this. It’s really for him to deal with. But I think if I can just speak very generally without directing….

FAINE:

We’re talking about balancing again.

PRIME MINISTER:

Yeah I know. Life is about striking the right balance. Government is about striking the right balance and….

FAINE:

You own 50.1% of Telstra and yet you’ve gone and made decisions that reduce its value, affect its share price in order to allow….

PRIME MINISTER:

There is a thing called competition which we all believe in and from a consumer point of view the more competition you have the better and in an area like telecommunications where we do own 50.1% and also where we have a responsibility to promote competition

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we’re trying to achieve a balance between those two and one way of achieving that balance is to make things where you can a little easier for Telstra’s rivals but equally not to badly effect the share price of Telstra. I mean one of the reasons why we have argued policy in relation to Telstra over the years is out of our sensitivity towards the share price and the value of the investment that people have made in Telstra.

FAINE:

Does this mean that any idea in your mind of selling off the rest of Telstra will have to be deferred until its value is resurrected after decisions you yourself have taken.

PRIME MINISTER:

I didn’t say that. They’re your words. Our position on future sale is as I outlined in the election campaign that things have to be up to scratch in the bush before that comes back onto the agenda.

FAINE:

But it’s very hard to see how on the one hand you can….

PRIME MINISTER:

Things are getting better in the bush. Telecommunications conditions are getting a lot better in rural Australia, a lot better.

FAINE:

Whether or not at the pace at which people want them to get better is another question….

PRIME MINISTER:

Well I guess nothing ever moves quite as….

FAINE:

The principal issue and the tussle that must be going on is if you have people within the Liberal Party who want to sell the rest of Telstra but you also have a commitment to competition policy then you make decisions that reduce the value of Telstra surely that puts off even further into the future any decisions…..

PRIME MINISTER:

Not automatically and in any event I don’t accept that the decisions we have taken if you put them all together have reduced the value of Telstra. I mean the main reason why the

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value of shares in Telstra has gone down is a worldwide trend against telcos. It’s got nothing, it really has not got an enormous amount to do with local conditions.

FAINE:

Alright. So you won’t take responsibility for yesterday’s drop in the Telstra share price?

PRIME MINISTER:

Of course not.

FAINE:

I wouldn’t have thought that you would.

PRIME MINISTER:

Can I say as I’ve said before, it’s a very valuable long term investment.

FAINE:

Prime Minister moving to other things, the ongoing violence that we’re learning about in detention centres in Australia has had your Immigration Minister Phil Ruddock copping some flak over in England. You’ve been saying that your detention centre policy is being supported more and more in Europe and yet he’s been under the pump wherever he’s gone, and particularly in London yesterday. The newspapers are reporting he’s been very rigorously questioned over Australia’s stance on detaining people who arrive here without permission. Does this embarrass you internationally?

PRIME MINISTER:

No. I’d expect him to be questioned. I didn’t think it was particularly rigorous given what he’s subject to here in Australia. I don’t think it was very rigorous at all. But look you expect that because it’s in the news and I understand that. You use the word violence. I do have to remind your listeners that the evidence that’s coming out and that you speak of, does involve, and I think it’s very sad and distressing, I didn’t enjoy watching that video any more than other people did, but it does involve self-harm. There’s no suggestion that those people were assaulted. So when you talk about violence, I mean it implies if I may say so with respect, it does imply that force has been used against the people in detention without any justification. Now I don't think even that was alleged by those people who propagated the showing of the video, that all of the injuries were inflicted. I have been told that the claims about medical attention being denied are not true. The claims about people being denied access to lawyers is not true.

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FAINE:

In what way not? We’ve heard from any number of lawyers who have travelled from Adelaide all the way to Woomera and been turned away at the gate.

PRIME MINISTER:

Well my information is that if people want to consult a lawyer they can and they are not stopped from doing so.

FAINE:

That’s a direct contradiction of what the lawyers are saying.

PRIME MINISTER:

Well you better get the lawyers concerned to write to me with the circumstances of their situation and I will refer that to the Immigration Minister. I can only act on the advice that I’ve received. Nobody enjoys detention. I wish we didn’t have to do it. But if people continue to seek to come to Australia illegally, we have no alternative but to have a policy of mandatory detention. It was a policy, let me again remind your listeners, it was first introduced 11 years ago by the Keating Government… by the Hawke Government, and supported of course by Mr Keating when he became Prime Minister. And as I understand it, as I speak the Labor Party is still in favour of mandatory detention.

FAINE:

But not for children.

PRIME MINISTER:

Well, but they bounce around, and the difficulty with just saying not for children is if you… that involves often breaking up family groups, which of itself is undesirable and I don’t think is in the interests of the people concerned.

FAINE:

And three more workers from Woomera broke their contractual silence, their contractual obligation of silence to the private company that runs Woomera, and spoke again last night on Lateline on ABC Television and are quoted in the newspapers everywhere this morning saying the conditions there are simply appalling and they feel an obligation to the patients to speak out about what’s going on.

PRIME MINISTER:

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Well that is them and then on the other hand you have the Immigration consultative group chaired by John Hodges that goes there and reports a very different point of view.

FAINE:

Isn’t this becoming a running sore…

PRIME MINISTER:

Well no I don’t believe it is … I mean there is a very strong campaign being run against the Government and particularly may I say by the organisation that employs you, that seems to have nothing else on Lateline except this issue. And you know, I have the impression the ABC has now become an advocate, a participant in the debate, rather than a reporter of the debate. I guess that’s something for the ABC itself to examine.

FAINE:

Well now it’s something more because you’ve just put it to me…

PRIME MINISTER:

Well I do. I think the emphasis that particularly that program has put on this issue is out of proportion to, and not consistent with its obligations to provide coverage of other current affairs issues and the way in which it reports it is as an advocate, as a participant, rather than as a reporter.

FAINE:

What should be done about that?

PRIME MINISTER:

Well that is a matter… I mean I don’t control the ABC. That’s a matter for the ABC. But I’ve never been reluctant on your program, or indeed any other program if these issues come up to express a viewpoint, and I do it openly - I don’t do it behind doors. This is a point of view I’m expressing publicly and I haven’t a different point of view that I’ve expressed privately to anybody. But I do think we’ve reached a situation now where it is no longer a reporter of this issue, it is now a strenuous participant in the debate.

FAINE:

Prime Minister, that could be interpreted as your reaction to the fact that they’ve done some reporting that’s embarrassed you. Because they’re getting some runs on the board, you’re trying to criticise them or nobble them.

PRIME MINISTER:

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Well of course you’ll say that. Of course people who will defend the ABC’s stance on this will say that. Of course, I understand that. I expect you to say that.

FAINE:

It’s investigative reporting. That’s all it is.

PRIME MINISTER:

No I think it has gone… I’m not complaining about the showing of the video. Any journalist who got hold of that would have done so. But what I’m talking about is the proportionate coverage relative to other current affairs issues.

FAINE:

Well it might….

PRIME MINISTER:

Anyway look you’ve asked me. I can’t put it any more plainly than that.

FAINE:

Are you going to write to the ABC Board or take it up with the Acting Managing Director?

PRIME MINISTER:

No, there’s no need to… well I might if you invite me to. But I’ve expressed my view. I think people would be aware of it.

FAINE:

Alright, well I’m sure a transcript of your remarks will be brought to the attention of the relevant people whether you write to them or not.

PRIME MINISTER:

I’m sure it will.

FAINE:

The situation in the Middle East at the moment. Oh sorry, still on the detention centres. There’s a new protocol for inspection of detention centres around the world, supervised by the United Nations. Australia’s refusing to adopt it and refusing to allow UN

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inspection teams to come and look into Woomera, Port Hedland, wherever we may have refugees detained. What have we got to hide?

PRIME MINISTER:

Well I don’t think you can say we’ve got anything to hide. I mean we have regular inspections. I mean in the past we’ve had inspections, we’ve had teams that have come here and I think we indicated didn’t we when the UN Human Rights Commissioner Mary Robinson asked some weeks ago to send somebody here, we said we would be happy to include, for that to occur as part of another upcoming visit.

FAINE:

So what’s the difference with this?

PRIME MINISTER:

I will have to get some more information. I saw that report this morning. It may not be accurate. I’ve certainly… can I say I have not been involved in any decision myself to say no to any UN body that wants to come although I do take the view that you can’t have a situation where every particular aspect of the UN is sort of investigating the same thing. I mean there’s got to be an end to it.

FAINE:

To point to a few domestic issues. You not long before Kerry Chikarovski was rolled as the Leader of the Opposition in New South Wales, you endorsed her success as the Leader of the Opposition in that state. Yesterday you were in Melbourne addressing the Victorian parliamentary Opposition, the Liberal Party here in Victoria. Is this the kiss of death for Denis Napthine?

PRIME MINISTER:

Well look I’m not aware of anything of the type you’re alluding to and I certainly think in difficult circumstances Denis is doing a good job.

FAINE:

But it’s not in difficult circumstances. We’ve got a minority Labor Government.

PRIME MINISTER:

The first term is always hard. It’s always a honeymoon effect the first term that a Government is in office and if you’re an Opposition Leader in those early months, early years of a Government’s term, it’s pretty tough.

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FAINE:

When you’ve got a minority Government that depend on three independents holding the balance of power, I’d have thought the job of the Leader of the Opposition was far easier than under almost any other imaginable circumstances.

PRIME MINISTER:

Well that’s a piece of political science commentary that I don’t agree with. I think actually it’s very difficult in the early years, particularly when you have a complete change of pace. Denis Napthine is a different leader from Jeff Kennett. The Kennett style was distinctive. It was ultimately… the public decided by a very narrow margin they didn’t want it. And you had a bit of a complete turnover, not only generationally but stylistically in the leadership of the Liberal Party here and I think it is quite a challenge and I think Denis is doing an extremely good job in very difficult circumstances.

FAINE:

Very briefly, if Michael Kroger becomes President of the Liberal Party, can you work with him?

PRIME MINISTER:

Oh I think Michael’s a terrific bloke but he’s not planning to be President.

FAINE:

There’s talk as part of a generational shift.

PRIME MINISTER:

Oh I see, yes. Well there’s always talk but I would welcome Michael Kroger playing a more active role. In fact I tried to get him to come into Parliament on two occasions and I remain very disappointed that he didn’t agree.

FAINE:

Prime Minister thank you for your time. The Prime Minister of Australia John Howard.

[ends]