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Budget 2011: Transcript of joint doorstop inteview: Canberra: 13 May 2011: 2011-12 Budget; skills; Fair Work legislation; Regional processing centre

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Transcript of joint doorstop interview, Canberra FRI 13 MAY 2011

Prime Minister

Subject(s): 2011-12 Budget; Skills; Fair Work legislation; Regional processing centre

PM: I’m here with Chris Evans, who’s the Minister who will lead the implementation of the skills package we announced in the Budget on Tuesday night, and we’re very pleased to be here at CIT, and I think the backdrop behind us is telling us the story - change the course of your life.

What our focus on the Budget, on jobs and skills is all about, is allowing people to get better opportunities in life, to literally change the course of their life. We know that if a young person gets an opportunity for an apprenticeship, that all-important trades ticket, then that will change the course of their life. It will mean that they’ve always got skills that can get them a job.

We’ve met today with some young apprentices who are doing remarkable things. Young people from the South Coast as well as here in Canberra, people who have decided to focus on getting an apprenticeship, getting skills, getting a trade.

We’ve also met today a mature-age apprentice, someone who had been to university, studied for a university qualification, but decided that they did want to go into the hospitality industry and into a trades apprenticeship. It’s that kind of person we had in mind with our Budget

reforms, so that you could move through your apprenticeship more quickly if you could show that you had the competencies needed to do the job.

In the Budget on Tuesday night, we announced a $3 billion package to focus on skills. It has at its centre nearly $560 million where we will partner with industry to provide new training opportunities - opportunities we know are relevant for the jobs of the future, because industry will work with us, using this fund.

It’s part of a bigger package as our focus on opportunity in the Budget continues.

Now, the Budget on Tuesday night was all about getting the nation back into the black, bringing the Budget to surplus in 2012-13, exactly as promised, but the Budget on Tuesday night was also focussing on keeping our economy strong so that Australians could the have

the benefits of jobs and opportunity - and opportunity starts with getting a job and opportunity starts with getting the skills you need to get a job, and for many of our young people an opportunity starts with a trade apprenticeship.

During the global financial crisis, we acted to protect jobs and also to protect apprenticeships. As our economy now moves to full capacity, we will be there, working to create jobs and create training opportunities, particularly for young Australians.

When Australia last had an economic downturn, it took more than a decade for trade apprenticeship completions to come back up to the level that they were before the decade. During the global financial crisis, we didn’t want to see young Australians miss out on that trade opportunity; end up missing out on a start in life, because they came of age during an economic downturn, and I’m very pleased to report that because of our investments, trade apprenticeships are now at record levels. That’s a very important part of the efforts the Government has made to ensure young people do get a start in life.

I’ll turn now to the Minister, who will talk about the skills package, and then we’ll be very happy to take questions.

MINISTER EVANS: Thanks, Prime Minister.

I’d just, I suppose, make a couple of points in relation to a couple of the key measures in the Budget.

Firstly, to say that the measures are designed to make sure that we have enough skilled people to meet the demands of industry. That’s why it’s very much an industry-led approach. We’re working with industry, partnering with them, to produce the workers that they need, so people going directly into jobs that are in short supply.

Two of the measures that are keys to the Budget - one is the mentoring initiative, which is about addressing the very serious problem that we have very high drop-out rates among young people doing apprenticeships and traineeships. Up to 50 per cent have failed to complete their course of study, so the mentoring program is designed to make sure we

support those people through their study; that we get more completions and therefore more tradespeople and more skilled workers.

The other aspect is the competency-based program funding, which is designed to assist the sort of person that the Prime Minister just spoke about, someone who’s been out in the workforce for 10 or 15 years, looks to get a trade qualification. Under the current system, many are told you’ve got to do the full four years, the same sort of requirement we put on a 15- or 16-year-old, on someone’s 30 and had 15 years’ experience. It doesn’t make sense. It’s the sign of an old system that needs changing, and the reform program this government will look to provide better competency-based and accelerated traineeships and apprenticeships, so

we get people with skills more quickly.

There’ll be no loss of standards. We’ll be assessing the competencies, but we shouldn’t expect a 30-year-old to have to wait four years to get the same qualification if they can prove they’ve got the skills. That’s a very important reform, and if you focus on the fact that we’re heading for huge demand for skills in the next few years, any capacity we have to get people

able to use those skills more quickly is a very important part of responding to that challenge of the skills shortages.

There are a lot of people working in industry, people who’ve worked as trades assistants and others who have been working for many years who, with a short period of time, 18 months, 2 years, could get up to trade qualification standard.

So, that’s very much a key to the reform agenda. It’s one of the measures the Budget’s the very much focussed on, and it’ll be a large part of what we do in terms of negotiating with the States to drive reform and cut through on some of the antiquated rules which prevent us graduating the skilled workers we need.

Thank you.

JOURNALIST: Prime Minister, Tony Abbott and Joe Hockey say that you are, in the Budget, trying to attack aspiration. Should we really think that people are going to not make the best they possibly can for themselves and their children for the fear of losing a small, relatively, Government benefit that’s actually really targeted at battlers?

PM: Well, first and foremost, let’s deal with the facts, and then deal with what this Budget is about.

Of course, what you’re referring to is some of the decisions the Government has taken on family payments. Let’s just be clear about the decision the Government has taken. We have decided to pause indexation of the thresholds. What that means is that in the next year around two per cent - two per cent - of families who would have got family benefit will not get family benefit.

What it also means is well over 90 per cent of Australian families will get more family payments than they have in the past, because the rate of payment will continue to increase.

Now, the Government took this decision because we want our family payment system to be sustainable today; sustainable in 4 years’ time; sustainable in 40 years’ time. So, it’s the right thing to do for us to make sure our family payments are sustainable. It’s also the right thing to do to make sure that more than 90 per cent of families get increased payments.

And I would also note this on Mr Abbott’s response - I mean, Mr Abbott, two years ago, when the Government took comparable measures, criticised the Government for being too soft. Now he’s out there criticising the Government for being too hard.

Now, the reality the Budget the Government delivered on Tuesday night is all about keeping our economy strong, getting the budget back into black, extending opportunities to Australians: the opportunity to get a job; the opportunity to get training; as well as extending to Australians the kind of services that they want and need today, including an historic investment in mental health.

The challenge for Mr Abbott today and tonight isn’t to carp about the Government’s Budget - it’s to explain to the Australian people what he stands for on budgeting. We know one of the reasons Mr Abbott is not Prime Minister is because Treasury concluded he was an $11 billion risk to the budget surplus.

So, tonight he’s got to explain to the Australian people if he doesn’t back our savings, what are the credible alternate savings measures he’s proposing.

JOURNALIST: (inaudible) budget, that message is not getting through. Why is that? Is Wayne Swan actually a good enough job? Do you have confidence in him as an economic salesman?

PM: We’ll, I’m very confident you’ll report the facts.


JOURNALIST: Just on the question on aspiration, do you think that, what do you say on Tony Abbott’s claim that you are somehow attacking aspiration?

PM: Well, of course the claim is completely untrue and absurd.

The Budget is all about jobs and opportunity: jobs and opportunity to enable people to aspire to a better future and a better life; to enable people to get a better future for their children. So, I understand Mr Abbott is wandering round desperate to distract from his inability to make the figures add up.

Tony Abbott will deliver his Budget reply tonight. Well, that’s got to be about the Budget, and it’s got to explain what he would do as Prime Minister.

I mean, three times he’s gone out to the Australian people with a set of figures. Last Budget reply night, complete shambles; during the election campaign, an $11 billion black hole, such a risk to the Budget surplus; and here, here earlier this year, in Parliament House in Canberra, they were unable to explain an alternate flood funding package.

Well, tonight, if Mr Abbott’s got criticisms of the Budget savings that the Government has made to get the budget to surplus in 2012-13 as promised, then he has to outline alternate, credible savings or back the Government’s Budget in.

JOURNALIST: How do you think he will go?

PM: Well, that remains to be seen, but if he doesn’t walk out of that parliament having explained where his savings are coming from, if he doesn’t accept the Government’s savings, then he will have failed a very major test.

Let me just say it again - one of the reasons Mr Abbott isn’t Prime Minister is because Treasury concluded he was an $11 billion risk to our budget. Now, that matters. It matters to cost of living pressures. It matters to adding to inflationary pressures. It matters to the strength of our economy.

Tonight he’s either got to accept the Budget as it is, or he’s got to explain the changes he would make and that has to be a credible explanation which passes the Treasury test.

No more laughable saves that Treasury just chucks out because they don’t pass the laugh test, and Mr Abbott, with a wave of his hand if wandering around saying he’s already got $50 billion worth of savings. Well, $11 billion of those Treasury concluded were simply wrong.

They were a black hole. And the rest of them he’s already spent on commitments he’s made to the Australian people.

He walks into that parliament tonight with zero saves in his pocket - absolutely zero - so anything he says about the Government’s Budget, if he wants to spend more, he’s got to identify the save. If he wants to knock back one of our savings, he’s got to identify the

matching save.

And in truth, if we were going to hold him to Joe Hockey’s test, he’d actually have to be explaining how he’d get the Budget to surplus a year earlier than the Government.

JOURNALIST: Prime Minister, what message are you hoping to send to the Australian people by lifting the Government cap on borrowing up to $250 billion?

PM: Well, the legislation, of course, has been introduced to the parliament today. I think the Australian people understand we had a summer of natural disasters. They were directly impacted themselves, or they watched with horror those images on their TV screens, and whilst at the time, of course, all of our focus was what was happening to our fellow Australians, now we are seeing the economic impact of those natural disasters. They’ve hit the Budget in lost revenue. They’ve hit the Budget because we need to spend more, of course, to rebuild Queensland, rebuild the nation.

And then weren’t the only ones that suffered over the summer. We also saw New Zealand suffer, and then we saw the tsunami and earthquake in Japan, and that, too, those natural disasters overseas, have hit into company revenues and hit into the Budget.

So, when they see the need for the Government to introduce this legislation, I think Australians will understand those kind of factors have hit into the Budget.

But, when we look the Budget we know that the Australian economy is going to be coming to full capacity. That’s why it’s very important to return the Budget to surplus, and we will, as promised.

We’re waiting till tonight to see how big a risk Tony Abbott is to that budget surplus, consequently how big a risk he is to the economy, how big a risk he is to adding to inflationary pressures and cost of living pressures on Australian families.

JOURNALIST: Do you know how long it would take to repay a quarter of a trillion dollars in debt under your Government?

PM: Yes, the debt profile has been moved out by one year, so the debt will be repaid before the end of the decade.

JOURNALIST: Does the Coalition need to clarify, itself, on its foreign aid budget?

PM: Well, that’s a very interesting point. The Deputy Leader of the Opposition has verified that the Coalition stands shoulder to shoulder with the Government with a bipartisan target about foreign aid. Now, I assume Tony Abbott, therefore, endorses our foreign aid expenditure, and anything else from him is just the usual kind of negativity we see from Tony Abbott.

On every statement made by the Deputy Leader of the Opposition, the Opposition fully supports the Government on our foreign aid expenditure.

JOURNALIST: Will you have the Treasury cost the Opposition’s Budget in reply? Are you going to get Treasury to have a look at the figures?

PM: Well, let’s see the Budget reply. I’m hoping that there are figures in it.

JOURNALIST: Will you be in parliament for the Budget reply?

PM: Yes, of course. I’ll do what Prime Ministers traditionally do, which is attend the Leader of the Opposition’s Budget reply.

JOURNALIST: Prime Minister, the Treasurer was asked this morning and couldn’t answer the question, I was just wondering if perhaps if you were able to tell us the last time Labor delivered a surplus?

PM: Yes, I can. It’s 1989-90, but very happy to play a pop quiz with you. Highest taxing government in Australia’s history - anybody got the answer? Anybody? You’ve heard Mr Abbott talk about tax a lot - highest taxing government in Australia’s history? What’s the answer?

JOURNALIST: Would it be the Coalition?

JOURNALIST: I don’t know.

PM: What’s the answer?

JORUNALIST: You tell me.

PM: The Howard Government, of which Mr Abbott was a senior minister.

So, every time any of you, or indeed the Australian people, ever hear the word ‘tax’ come out of Mr Abbott’s mouth, in any context, the question to him is ‘what does he say, having imposed the highest taxes on this nation that have ever been imposed on it?’

JOURNALIST: Would you like to be a journalist?

PM: Well, all I ask for is accurate, detailed reporting. Highest taxing government? Tick - Tony Abbott.

JOURNALIST: Can I then ask you about the desalination plant in Victoria? Reports of very large increases in pay - is your Fair Work legislation enough to contain a wages break out, and are you worried about it, the possibility of it?

PM: I’m standing with the current Minister responsible for all of this, but the Fair Work system is an enterprise bargaining system, so people working on a job, whether it’s a desalination plant or construction of a building or working in a factory or working for an office-based business can sit and bargain with their employer to work out what works for their business.

So, under the Fair Work system the outcome in one enterprise bargain does not flow to other enterprise bargains.

Now, of course we are seeing the economy come to near full capacity. That’s what the Budget strategy is about, and we know when the economy runs hot that you can run into constraints - the economy gets hungry for workers, it gets hungry for skills, it gets hungry for infrastructure. That’s why we’ve invested in each of them, and that’s about addressing the inflationary pressures I presume you are concerned about and that has motivated your question.

JOURNALIST: Prime Minister, where is the Treasurer? He was supposed to be here this morning, is he still recovering from busting a glass?

PM: Number one, the Opposition, with next to no notice, withdrew his pair. So you may want to ask them about that - hasn’t been done before, to my knowledge, that a pair’s been withdrawn on that kind of notice.

Number two, Wayne Swan did smash a glass this morning. That’s less important than Tony Abbott smashing the Budget surplus tonight.

JOURNALIST: (inaudible) Manus Island, what’s your advice? There are conflicting reports this morning that the PNG is Cabinet is going to sign off it, that there’s a split. What has Chris Bowen told you about the solution or the deal that’s being worked on at the moment? Are you going to get personally involved?

PM: Well, I read reports in the newspaper about my degree of involvement in PNG, and they’re all wrong, so the Government will keep working through with PNG the way that we have been. The matter is under discussion.

Thanks very much

JOURNALIST: Have any of your MPs raised any concern about backlash from the Budget

PM: Sorry?

JOURNALIST: Have any Labor MPs raised any concerns with you about potential backlash from voters on the Budget?

PM: No.