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Transcript of interview with Karina Carvalho: ABC News24, Breakfast: 23 August 2012: Olympic Dam



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SENATOR THE HON PENNY WONG

MINISTER FOR FINANCE AND DEREGULATION

TRANSCRIPT

PW 175/12 23 August 2012

TRANSCRIPT OF INTERVIEW - ABC NEWS24 BREAKFAST WITH KARINA CARVALHO

SUBJECT: OLYMPIC DAM

E & O E - PROOF ONLY

CARVALHO: Good morning, thanks for your time.

WONG: Good to be with you.

CARVALHO: The Resources Minister, Martin Ferguson, on AM this morning has said that the mining boom is over. Do you agree?

WONG: We still have a lot of investment coming into this country, about half a trillion dollars in the pipeline, and more than half of that at the advanced stage. But the Government has always said you have to plan for beyond the boom as well as for the boom, which is why we’ve made the investments we’ve made into schools, into our universities, into our skills system, and into productive infrastructure like the National Broadband Network.

CARVALHO: So is that a yes, the mining boom is over?

WONG: No, I think the mining boom still has a long way to run but what I would say is that the Government has always assumed that the terms of trade would step down over time and that’s what our budget is predicated on.

CARVALHO: So why did Martin Ferguson say that we have to understand that the mining boom is over and we’ve done well out of it?

WONG: Minister Ferguson was referring to when the terms of trade peaked and that’s factored into the Government’s budget. But what I do want to talk about and I think is very important is the excerpt of the interview that you played just before I came on.

Because can I say this: this is one of the most dishonest, self-interested fear campaigns that we have seen in Australian politics. Mr Abbott is saying to Australians: ‘Believe what I say, even if it isn’t true, but ignore everything that the BHP board and the BHP company have put out as their advice to the market, to investors and shareholders, about the reasons they have delayed Olympic Dam’.

Now, it is a disappointing decision. I’m a South Australian - I’m very disappointed by it, as are all South Australians. But to have the alternative Prime Minister putting forward baseless propositions, not even reading the statement, because he thinks it’s in his political interests, really demonstrates what sort of character we have here.

CARVALHO: You mentioned of course that you’re from South Australia - the South Australian Premier, Jay Weatherill, clearly very upset at this because it would’ve, if this expansion had gone ahead, been a huge boon in terms of the jobs created and the money going into the State. How difficult will this be for South Australia?

WONG: This is a disappointing decision for South Australia, it is. But unlike Tony Abbott, I am not one that thinks this spells the end for South Australia. It’s very disappointing to see him talking down the South Australian economy like this.

Remember, this Government has made a lot of investments in South Australia. We’ve more than doubled the infrastructure spend per person in South Australia. We’ve committed to assembling the submarines there - something Tony Abbott, certainly Joe Hockey, is opposed to. We’ve put money into General Motors Holden there - something Tony Abbott is opposed to. And, unlike Tony Abbott, we’re not proposing a per capita GST distribution, which would take around $1 billion out of my home state. If Tony Abbott really cares about the people of South Australia, those are the policies he should be focusing on.

CARVALHO: So what will this mean for the Government’s tax revenues?

WONG: We’ll update our Budget in the usual way at the Mid-Year Outlook. But I would say, again, this is a disappointing decision. But one of the things that is pleasing is that BHP in their public statement have made clear they will look at other ways to expand Olympic Dam and I hope that they can find a way to make this investment work for them and for the people of South Australia.

CARVALHO: But we’ve also had, in recent times, decisions from Woodside, Shell, as well as BHP Billiton to delay, if not shelve, some of their projects. What impact will that have on the Government’s bottom line?

WONG: We will update our figures in the usual way. We did assume the terms of trade - which includes, obviously, reference to commodity prices - we did assume those would step down. So we haven’t assumed in our budget that the terms of trade, that the prices Australia is getting for the things we sell to the world such as coal and iron ore, we didn’t assume they’d stay at the levels they were when we put the budget together. We assumed that they would track down.

CARVALHO: Some analysts have suggested that the prices that you’ve predicated those figures on are still inflated, even though you’ve reduced them somewhat.

WONG: And we would update our Budget in the usual way. I think it’s a little early for everybody to be talking ‘doom and gloom’. Remember, we’ve got an economy with low unemployment, contained inflation, interest rates which are falling, and we’ve had about 810,000 jobs created since this Government came into office.

This is a disappointing decision but this doesn’t signal the sort of ‘doom and gloom’ that some people would like people to think it does.

CARVALHO: Penny Wong, in Canberra, we thank you very much for your time this morning.

WONG: Good to be with you.

ENDS