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Shadow Treasurer criticises mobile phone spectrum sale.

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VIVIAN SCHENKER:  As we have already discussed, the Howard government’s much vaunted big-budget surplus appears to be on shaky ground. On top of an economic downturn, it suffered another blow with yesterday’s $1.3 billion drop in the government’s predicted sale of new mobile phone services.


Federal Treasurer, Peter Costello, says the mobile phone spectrum received a decent price in the current circumstances and denies the shortfall from the sale has blown a hole in his budget surplus. But the opposition claims the budget is now in a very sick state and has accused the government of propping up a depleted surplus.


Cathy Van Extel has been following this and she is speaking now to Shadow Treasurer, Simon Crean, who is with us from Brisbane.


CATHY VAN EXTEL: Good morning, Simon Crean.


SIMON CREAN: Good morning, Cathy.


CATHY VAN EXTEL: Now, the Treasurer says that the government would not have accepted that price if it was not decent. How can you be critical when it is above the reserve price that the government set?


SIMON CREAN: The government had to accept the bargain basement sale because otherwise it would have had to explain how it has lost more than $2.6 billion rather than more than $1.3 billion.


This is a government that is so desperate now it will do anything to hide the truth, and it will avoid every tough decision. They are not prepared to go after the top end of town on tax avoidance. They are walking away from significant initiatives, yesterday, when it had an agreement with Labor to do it. It’s another example of how it is soft on the top end of town. It wants to go after pensioners—ordinary Australians—and slug them with the GST, but soft on the top end of town. And to cover up its mismanagement it now resorts to hiding the figures or accepting bargain basement prices.


CATHY VAN EXTEL: Although the government says that it still expects the sale of other spectrum, like datacasting licences, to add to the figure.


SIMON CREAN: Look, the government will always do two things: it will blame someone else for the problems or it will say, ‘wait for the future’. The truth of the matter is this government continues to get it wrong.


Last November it was projecting increased growth in the middle of a quarter, where the economy was going negative. Now, it has been exposed for having projected more than $2.6 billion in sales and only realising $1.3 billion. How can a government that is supposed to have good economic management credentials get it that wrong?


CATHY VAN EXTEL: Although the latest IMF assessment of Australia has endorsed the government’s economic management. Aren’t you guilty, as the Prime Minister suggests, of talking the economy down?


SIMON CREAN: Talking the economy down—that’s a bit rich coming from the Prime Minister, who had the debt truck out there five years ago, who said there was only five years of economic sunshine, who he and his treasurer continued to talk down the Australian dollar, talk about the value of the Australian dollar when it was more than 70 cents, and now they want to accuse us of talking the economy down. It is nonsense. They have run the economy down. And as for the IMF report, this was a report concluded before the December quarter national accounts. So what would the IMF be saying now, with an economy that was forecast to grow when in fact it has produced negative figures.


CATHY VAN EXTEL: You talk about the government looking after the big end of town. Yesterday we saw the BRW top 1000 CEOs poll show no confidence in Labor at all, from the big end of town. How can you get them back on board?


SIMON CREAN: Well, look, Cathy. If they are looking after the top end of town you would expect that end of town to give them an endorsement, wouldn’t you? But I think the most revealing thing out of that survey is that 1,000 were asked, only 150 responded—150, that is less than a third of the 500 Club of the Liberal Party.


CATHY VAN EXTEL: Simon Crean, you are suggesting that the budget must be in a sick state. What does that mean for Labor policy in the lead-up to the election then?


SIMON CREAN: Look, I think what it means, first of all, is: what are we going to do to get the economy out of this problem?


We have got a government that has been asleep at the wheel, a government that has cut expenditure in the things that should have driven growth and positioned us better to get into new industries—research and development, education and skills. That is what the government cut, and we are paying a price for it now.


CATHY VAN EXTEL: But if you are saying things are so bad with the budget, what does that mean for you, going into a poll?


SIMON CREAN: It means our task is harder, but it also means the task for the nation is harder. We need a change of direction. We need a commitment by government to get investment. We need a commitment by government to get us into the new economy.


The only party proposing policies is Labor under its Knowledge Nation banner. We have called on the government to do it. We would join with them in policy shifts that actually drove us in that direction, but this government is showing it’s been caught in the headlights. It can’t take a decision and it, therefore, needs to be changed.


CATHY VAN EXTEL: Simon Crean, thank you very much for joining us.


SIMON CREAN: A pleasure, Cathy.


VIVIAN SCHENKER: Shadow Treasurer, Simon Crean, in Brisbane, speaking to Cathy Van Extel.