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Transcript of joint interview with Ross Greenwood: 2GB, Sydney: 4 August 2010: [Leaders debate; economic stimulus; Election campaign].



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Transcript: Craig Emerson with Ross Greenwood, 2GB Sydney Craig Emerson posted Wednesday, 4 August 2010

GREENWOOD: Last week we had a debate between Senator Eric Abetz, the Shadow Minister for

Employment and Workplace Relations, Leader of the Opposition in the Senate, and Craig Emerson, who of

course is the Minister for Competition Policy and Consumer Affairs, Minister for Small Business - and I’ve

got to say it went well.

Interestingly enough we did debate with them the economy and where it was going last week. And of

course, since then Julia Gillard has come out and said that she would like to debate Tony Abbott about

the economy - the state of the economy. Who has the best chance of getting the economy back in to

surplus sooner, with the more assured policies.

Now, what I thought was that seeing as the debate might not happen between the leaders, we might as

well have the economic debate between two highly-credentialed politicians from either side. Both of them

very senior inside their parties. And as well as that, also perhaps, people who have been architects of

significant policy in the past.

So to Craig Emerson first up, thank you for coming back, and thank you for entering the spirit of the

debate again, Craig.

EMERSON: Well, thank you Ross, and it’s very flattering of you.

GREENWOOD: So, Senator Eric Abetz as well. Same to you, welcome to the debate. And I trust that you

both enjoy the spirit of it as well.

ABETZ: Good evening Ross and good evening Craig.

EMERSON: I enjoy a good robust debate, because that’s what election campaigns are all about, and

that is debates about policy, and that’s what people are interested in, in my view.

GREENWOOD: I made the point to both of you last week that I believe that a lot of election policies,

when you go into them, the policies… the parties might appear slightly different, but the policies can be

quite similar. Say, for example, when Kevin Rudd was elected John Howard would hand out tax cuts, Kevin

Rudd would hand out tax cuts. It was almost a case where, to a certain extent Kevin Rudd shadowed the

Prime Minister John Howard and clearly had a significant lead.

In this particular case you have two untried leaders who are at either end, I kind of guess, of where their

policies lie. They’re both untried as leaders. But the second side of it is I believe their policies are poles

apart. One wants an emissions trading scheme, one really does not. One wants a mining tax, one does

not. One wants national broadband, one does not.

EMERSON: One wants economic stimulus to continue for a time, the other does not.

GREENWOOD: And, I’ve got to say as a result one wants to actually make significant cuts to the public

service, one does not. So there’s other yin and yangs here as well.

You know, as a person who’s out there campaigning right now, Craig, do you believe that the electorate

genuinely understands those differences, and that they are deep philosophical differences that people

have got a choice about?

EMERSON: Certainly I agree with you, Ross, that there are sharp differences on economic policy

between the Coalition and Labor. And it’s in our interests as a political party that the public is fully aware

of those sharp differences. We’re very happy to advocate the policies that we’ve embraced, because we

obviously think they’re in the national interest. No doubt Eric will say the same about his. But in the end

it’s a matter for the people to decide. But the differences are enormous. There’s no whiter shade of pale

here. They really are at the opposite ends of the economic spectrum in terms of policy.

GREENWOOD: Before I go to Eric, can I ask you what is that drives the policy of the Labor party that

comes up with a set of policies that you have right now?

EMERSON: Well, we fundamentally believe in a strong economy. We believe that there has been

massive underinvestment in out future productive capacity during the period of the previous government.

And that’s why Labor set about investing in both infrastructure and, very importantly in training and

education through the Education Revolution. Because these are the two areas that we consider were

starved. And if we’re going to resume productivity growth, which stalled under the previous government,

and is the key to tomorrow’s prosperity we need to make those investments. Our view is that the

Coalition isn’t doing that, doesn’t really have an economic interest in doing it. And in terms of where the

economy is at the moment, we do believe that some economic stimulus remains necessary. I think you

saw the figures yesterday that the Reserve Bank contemplated, and it does indicate that there are still

parts of the economy that are not growing strongly. The worst thing that could happen is for that

remaining stimulus to be pulled out. And that’s really what the Coalition is saying. We believe that that

will devastating for jobs and for small business.

We’ve got Tony Abbott embracing, earlier this year on two separate occasions more than a month apart,

the New Zealand model. Well, he said ‘they got it right, why don’t we go down the New Zealand path?’

Well, the New Zealand path was a year long recession and unemployment going above seven per cent.

That is absolutely ludicrous.

GREENWOOD: Now, of course a different country without the mineral resources, I’ll pick you up there.

Let’s go to Senator Eric Abetz now, I mean you gonna respond, and obviously set out the parameters for

the Coalition as well, because as I say the policies are quite distinctly different from where they are in the

Labor Party.

ABETZ: Oh, absolutely Ross. You’re right. One thing that Craig didn’t tell your listeners was that under

Labor we’re borrowing over $100 million a day which will have to be repaid by the next generation. So

our policy is very firm. It is we will end the waste and repay the debt and stop the big new taxes. And the

so-called economic stimulus, just remember when Craig Emerson talks about the economic stimulus

package he’s talking about the pink batts, 200 houses burning down, $1 billion to rectify that mess. He’s

talking about an extra $1 billion of government expenditure because they can’t stop the boats. $2 or 3

billion or more to rectify the Building the Education Revolution which provides laptops without

connections, libraries without books. It’s all about spin and this is not good spending. It is wasteful

spending and Australians are already paying a huge dividend by way of interest in relation to that

borrowed and wasted money. And we just say the reckless spending has to stop. We have to start paying

back the debt and these new taxes, both the mining tax and the Carbon Pollution Reduction Scheme -

which by the way Julia Gillard unwittingly committed herself to on the 7:30 Report, she’s now absolutely

in favour of it. What those two taxes mean is that the cost of power to every single household and

business in Australia will increase. The price of groceries will go up by seven per cent, and the list goes

on and on as for the impact, not only for business, but for all your listeners in relation to cost of living.

Costs that they shouldn’t have to incur, but they will incur because of Labor’s wasteful and reckless

spending.

GREENWOOD: Alright, I’ll tell you what we’re going to do here, we’re going to take a break here.

You’ve heard the opening statements from both. I want to try and if you like… if you want to call in and

leave any questions for us, or send us an email, obviously at 2gb.com click on the feedback icon. Or

MTR1377.com.au. We’ll take a quick break here. Come back with your views and also keep this debate

going. Because as I say, it’s a fundamental thing for this election, and for the future of the country with

such distinct differences in the policies of the Coalition, and obviously of the Government.

[commercial break]

GREENWOOD: Welcome back to Money News, of course with our debate with Senator Eric Abetz and

Craig Emerson. Of course looking at both sides of politics and what they’re doing at the moment. I’ll go,

first up, Eric Abetz. Glen has given us a call - ‘what is it that either side will do to reduce red tape for

business?’ We haven’t heard much about that Eric.

ABETZ: We have announced a small business ombudsman and I believe that’s going to be very

important. More importantly our small business minister will actually sit inside the Cabinet - another

important indication as to how seriously we take small business. Labor, of course, promised that they

would remove one regulation for every new regulation they introduced, and they have failed that by a

factor of, I think, one to 1000. So they have only cut about one for every 1000 regulations they’ve

brought in. They made that sort of a promise. I’m not going to say how many regulations we are going to

cut, despite to say, as I’ve been going around - all of us have been going around - we have heard the

message loud and clear, so we want to protect small businesses, make life easier for them and as a result,

small business into Cabinet, with a small business ombudsman. And, might I add from a small business

point of view a fair contract position as well.

GREENWOOD: Right, I’ll go across to Craig, because I would suggest a lot of small businesses would

not necessarily be happier with either party at the moment. Yes there are tax cuts being promised by both

sides. But both are either hitting them with increased superannuation or compulsory leave loading for

parental leave. And I just wonder about that as well Craig.

EMERSON: Well tax cuts aren’t being promised by both sides. Tax cuts are being promised by one

side - and that is the Labor party. The other side is promising a great big new tax on everything you buy

to pay for this paid parental leave scheme.

ABETZ: Well, that’s not true Craig…

EMERSON: And interestingly today Tony Abbott was asked ‘well, when would he get rid of it?’

Because he was supposed to announce yesterday when he was going to get rid of this so-called

‘temporary levy’. And he said ‘well, when the Budget’s back in surplus in 2012-13.’ Well, that’s when he’s

going to introduce it, in 2012-13. In the meantime, adopt Labor’s parental leave scheme if he was

elected. And he says, and Eric was talking about debt and deficit and that they want to get the Budget

back into surplus, well Tony Abbott today said he’d get the Budget back into surplus in 2012-13. That’s

when we’re getting the Budget back into surplus. So he’s trying to pretend there’s some major difference

there. But in fact, what they’re going to do is they’ve promised $46 billion of what they call ‘real savings’.

We did use economic stimulus to keep Australia out of recession. The only advanced country in the world

to do so. We’ve got a low unemployment rate, the lowest amongst the advanced countries of the world

and we will return the Budget to surplus in 2012-13. We’ve got the lowest net debt in the world. So the

economy itself, and the economic management of this Government has meant that we are in pretty good

shape. But the last thing we need is to withdraw the stimulus - now that would definitely smash small

business. And then we’ve got this Coles and Woolies tax that would cascade from large businesses down

to small businesses. So you’ve actually got the Coalition promising a new tax on small businesses -

effectively by applying it to larger businesses, and they’ll just pass it on…

GREENWOOD: And while you’re there Craig, I’ll move on to another one, and that is Geoff: there’s a

percentage of small businesses that don’t operate as companies, therefore they don’t get the benefit of

the company tax bracket. Is that something of a concern, because there’s so many sole traders out there

who don’t necessarily get the benefits of what both parties are really offering up at this stage.

EMERSON: Again, I’m happy to correct Geoff. What we will do for every small business in this

country - sole traders, partnerships and companies - all of them, every small business, 2.4 million small

businesses, is offer the instant write-off of the value of any and every asset costing up to $5,000. This is

Labor policy for every small business in the country. The Coalition’s policy, Tony Abbott’s policy, is to

scrap that. He will not commit to doing that because he wants to give revenue from the mining tax back

to the mining companies who are quite prepared to pay that money. He says ‘no, I want to give that back

to you,’ and therefore deny those 2.4 million small businesses the small business tax break that Labor is

offering.

GREENWOOD: Alright, I’ll go to Tim’s question right now: what are either party doing for the farmers.

And he talks about the havoc of free trade. Eric, I’ll start with you there.

ABETZ: I can understand the concern of the farming community, but we have to understand that we

export about 80 per cent, 80 per cent of our product. And therefore it stands to reason that if we want

other countries to import our product, we cannot raise undue barriers. I believe that we should have

barriers to protect our biodiversity, our biosecurity and that is why I’m very concerned, for example

Labor’s approach to the importation of Chinese apples, just as one example. So free trade yes, the

protection of our biosecurity I think is an absolute viable element.

GREENWOOD: I will say that I think both parties are fairly similar here, Craig Emerson, because quite

clearly it was also a Labor government that did reduce a lot of tariffs in the Hawke-Keating Government.

And as a result of that much of what we have seen now leading to the free trade agreements has very

much come from Labor governments as well.

EMERSON: Yeah, tariff reductions did occur, there’s no doubt about that. They were tariffs on

manufactured products, not on farmed products. Farmers have had to contend with tough international

markets all the way through. And what we wanted to do, and have done effectively, is by reducing tariffs

on manufactured goods is reduced the penalties, if you like, on farmers who are overwhelmingly export

oriented. That’s been our approach. Farmers are used to facing tough international markets. No one can

really do anything about that. But what we can do something about is the costs. The costs of production,

the very red tape we were talking about a little earlier, which we are addressing through matters such as

the Superannuation Clearing House and Standard Business Reporting that will make small businesses find

it a lot easier to complete their reporting obligations, including their GST obligations. 70 per cent of small

businesses will benefit from that. So cutting red tape, reducing costs, introducing a National Broadband

Network will in fact help farmers. And again, this is a policy… there are sharp policy differences, because

Tony Abbott said he will pull the plug on the National Broadband Network, that farmers and other people

in regional Australia do not deserve the benefits of high speed national broadband networks. We believe

this is a first world country and it needs first class telecommunications. Not going back to Tony Abbott’s

fond 1950’s, but well into the 21st Century, like Korea, like Japan, like all those dynamic countries that

absolutely understand that their farmers, that their small business communities need and deserve high

speed broadband networks.

GREENWOOD: And Eric Abetz, I would say that a lot of people would be looking at this and saying that

high speed broadband is obviously something that would be desirable for Australia. But quite clearly Tony

Abbott and your Coalition have taken a different view on this.

ABETZ: Oh, look, broadband absolutely desirable. And we had a plan at the last election - the OPEL plan

- which would have covered Australia. Labor then went to the election promising a $4 billion plan that

would have covered, they said, 98 per cent of Australia. We said it wouldn’t work. Now, and this is a

classic example of Labor’s waste, the $4 billion promise has transferred into a $43 billion project. Instead

of covering 98 per cent, only covers 90 per cent of the population.

EMERSON: That’s incorrect Eric.

ABETZ: And guess who misses out? Mainly the rural areas.

GREENWOOD: But the interesting thing about this though, if I can cut in here Eric…

ABETZ: … billion dollar plan does not, ah project, does not have a business plan to go with it. It is just

another example of the wanton waste of Labor. Sure we’d like broadband, sure we’d like having peoples’

roofs insulated, sure we’d like school buildings but we don’t like the wanton waste that goes with Labor’s

spending which we will have to pay back without anything show for it in a future year. So look, we love

the idea of broadband. We’ve committed to it. We will be announcing our policy very shortly but we don’t

support Labor’s non-business plan approach which leads to the sort of waste and disasters as we’ve seen

with pink batts and the Building the Education Revolution.

GREENWOOD: Gentlemen, I have to wrap it up there. Out of time on our debate tonight. And I’ve got

to say, look, thank you to all the callers who came through with all of the issues you want to put to our

politicians. And can I say, the truth about this is that it should be a debate. It should be had. And It

should be open to you be able to ask the questions as well. So can I say, to first of all Craig Emerson,

Minister for Competition Policy and Consumer Affairs….

EMERSON: Thanks Ross, and if I can just conclude by saying it’s a great pity that the Coalition

believes that the National Broadband Network is a waste of money. But it has been a good debate, and I

think these are the sorts of policy debates that people want to hear. And I thank you very much for having

us on the program.

GREENWOOD: Thank you very much Craig. And also to Senator Eric Abetz, Shadow Minister for

Employment and Workplace Relations and Leader of the Opposition in the Senate, thanks for your time as

well Eric.

ABETZ: If I may just quickly say that we don’t like waste and we would be supportive of the broadband if

there were actually a business plan, but Labor can’t put a business plan together because it’s just such a

huge waste of money that they can’t justify on a business case.

EMERSON: Excuses, excuses, excuses.

GREENWOOD: You’ve said it. I’ve got to go Eric. I do appreciate both your time. It’s a great way to do

it. The calls that we got in were fantastic. We’ll take more of those after 7 o’clock tonight.

Tags: Business, Craig, Economy, Emerson, for, Free, Small, Support, Trade