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Transcript of press conference: MTA Training Centre, Adelaide: 28 February 2008: skills announcement; health funding; Murray Darling; Mersey Hospital; ABC Learning; MTA.

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Prime Minister of Australia


Press Conference, MTA Training Centre, Adelaide, South Australia

28 February 2008

Subject(s): Skills announcement, Health funding, Murray Darling, Mersey hospital, ABC Learning, MTA


PM: It’s good to be here in Adelaide again and good to be here at the Motor Trades Association of South Australia Apprenticeship Training Centre, and here with Mark Butler and Tony Zappia, our local Members of Parliament.

We’re here today to talk about the absolute importance of skills to the future of the Australian economy. The new Australian Government is committed to building a modern Australia capable of dealing with the challenges of the future and to provide a future for working families.

Part of the challenges of the future consists in what we do in the current fight against inflation, because if we don’t fight inflation what we continue to have is upward pressure on interest rates.

We, the new Government, inherited an inflation rate in Australia which was running at 16 year record highs. And we inherited interest rates which were the second highest in the developed world.

This is a real problem. Because if you’ve got inflation going up, it puts upward pressure on interest rates. So that’s why from the beginning of this year within a month of taking office we’ve indicated that we regard the fight against inflation as core economic business for the new Australian Government. Inflationary pressures are driven by excessive government spending on the one hand and on the other hand by problems on the supply side of the economy as well. Particularly skills and particularly infrastructure.

If you’ve got inadequate skills, inadequate infrastructure on the one hand, and if you’ve got out of control government spending on the other, guess what: it pushes inflation up and inflation goes up it puts upwards pressure on interest rates, which hurts working families.

So what we’re here to do today within that framework is to announce further what we intend to do to assist in the skills shortage in Australia.

Here in South Australia there are many shortages in the skills market in many sectors of the economy. So what we are committed to doing is implementing our pre-election commitment of creating across Australia an additional 450,000 training places.

But today, as of today, we put online 20,000 new training places, 20,000 new training places, which registered training organisations such as the MTA here in South Australia can now make application for. These are particularly concentrated at Certificate II and Certificate level III training. Cert II and Cert III are important because the feedback we’ve had from employers across the country is that they want their workforce to have higher and higher levels of skills. And if there’s one overriding request from industry it’s we need more skilled workers and we need more highly skilled workers as well. And that’s why our program, this productively places program, that we’re announcing today, is all designed at making available higher level certificate training places.

We’ll be focusing this program, in particular, on the following sectors: mining and construction, it’s very big in South Australia where we’ve got particular demands for carpenters, bricklayers, joiners, wall-floor tilers, roof plumbers and this is really important work . Particularly with the unfolding mining boom here in South Australia.

Secondly, health and community services. Thirdly, motor mechanics of the type that we’ve been talking to here today, automotive electricians, panel beaters, vehicle platers, vehicle body making. And personal and other services, which include the travel and tourism industry as well.

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These are four priority areas for the economy nationwide, priority areas for the economy here in South Australia, and priority areas, therefore, where these 20,000 new training places will be focussed.

To conclude, core business for the economy, fighting the fight against inflation. To do that you’ve got to be boosting skills, dealing with infrastructure bottlenecks and reining in unnecessary government spending. What we’re here to do in South Australia is to release this 20,000 additional training places so that employers, as early as next week, can lodge their application for these places and as early as four weeks time can start delivering those new training places through access to the funds delivered under this program.

Happy to take your questions.

JOURNALIST: Prime Minister just on that point you ‘re connecting inflation to training places. If you create more training places, more jobs, more wealth. How’s that putting a lid on inflation?

PM: If you look at the Reserve Bank’s warnings to the previous Government on inflation, they delivered 20 warnings in a row, and those 20 warnings focussed on a shortage of skills and a shortage of infrastructure. That was not the Labor Party saying it at the time, it was the Reserve Bank of Australia. Because if you’ve got inadequate supply of skilled labour, guess what? It fuels inflation.

If you’ve got inadequate infrastructure across the country like infrastructure bottlenecks at our ports and our roads system, it creates a constraint in the economy which pushes prices up as well. So the core business of dealing with inflation on the supply side of the economy means boosting skilled labour and dealing with infrastructure bottlenecks.

Twenty successive warnings from the Reserve Bank, that’s why this commitment from the new Australian Government for an additional 450,000 training places over time, and 20,000 of those released now, is an important step in the right direction.

JOURNALIST: How long will it take to release the whole 450,000 of those?

PM: Our commitment is to do that over a number of years. From memory, four. I stand to be corrected on that if I haven’t got it precisely right, three or four. But what we have been determined to do is to hit the ground running, but making sure that we have within our first few months in office a release of 20,000 of those priority places now.

The demand from business right across Australia is huge and we’ve decided to hit the ground running, put these up online now. Registered training organisations such as the Motor Trades Association of South Australia can whack in an application as of a week’s time and they can start accessing those funds as of four weeks time. Not bad if you’ve only been in Government a few months.

JOUNRALIST: On another matter, here in South Australia obviously the River Murray important. You’re speaking to the Premier today -

PM: That’s right, yeah.

JOURNALIST: … and I don’t doubt it’ll be mentioned. When do you, or are you, going to do personally intervene in this and bang Victoria’s head with someone else’s so we start getting some water down the river?

PM: First of all, as someone said the other day, the problem in terms of the River Murray inadequate water supply for the good states of Victoria and South Australia, these problems have been around for about 100 years. Secondly I note that the previous Government for 12 years actually did nothing to resolve this. Thirdly we’ve been in office now for somewhere between two and three months.

This is core business, however, for the people of South Australia, and therefore, its core business for us as the National Government. That’s why Penny Wong, the Minister for Water, has already met with her Victorian counterparts. To look at the scope of a possible deal which meets the long term interests of the people of South Australia as well.

It’s been around for a long time, we’ve had 12 years of inaction, we’ve been in office for a couple of months, but for us this is a big priority. Penny Wong has already had one set of negotiations as I understand with the Victorians. It will be part and parcel of my own negotiations with the Victorians soon. We want a deal on this as soon as possible.

On the Murray itself, can I say also this, we have within the first couple of months of being in office already allocated $50 million to begin the buyback of water entitlements (inaudible) the Murray. That wasn’t happening before. It’s now happening. And so, with that process underway, we’re already starting to take action to relieve some of the pressure on the River Murray system.

Also on water policy in general, remember our pre-election commitments here on water are significant. $160 million to

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support the South Australian Government’s proposed desalination plan in the Upper Spencer Gulf. We also have a separate $1 billion urban water program, so that if South Australia goes down the road of a further desalination plant for the city of Adelaide, there is an opportunity to draw on the funds available in that $1 billion dollar program to make such projects possible. And on top of that, there are up to $400 million in practical water savings projects to improve water efficiency and make significant water savings at the Menindee Lakes on the Darling.

These are all practical projects (inaudible). Penny Wong’s at work on it, I’m at work on it, and well deliver an outcome as soon as is possible.

JOURNALIST: Prime Minister, with great respect, South Australians, I think, are sick to death of hearing something’s going to be done soon. Because time is clearly running out. We want to know how soon until we see more water coming down the river. I know you can’t make it rain, perhaps you can, I don’t know, but -

PM: Have you got the formula for how that works?

JOURNALIST: Not quite. But that’s the problem, I mean, South Australia’s frustration is hearing people such as yourself say something will happen soon.

PM: What I’m saying to you is this. There is a water challenge, what are the bits that make it up? One is the River Murray. How do you fix that? A deal with Victoria in relation to its irrigators. We’ve been in office for two months, the previous mob had 12 years to do this they didn’t do it, and we’re working hard on it. The other thing with the River Murray is to buy back water entitlements generally. Within two months we’ve started that with a $50 million allocation of funds I think last week to do it.

What else do you do on water for South Australia? You directly contribute to other urban water projects, and related water projects, in this part of the state.

That $160 million for the upper Spencer Gulf that’s not a piece of loose change, that’s real money. A billion dollar program to assist the people of South Australia with a further desalination project if that’s what happens here, together with up to $400 million worth of projects with Menindee Lakes on the River Darling. These are all very practical projects. So we believe this is core business. It’s going to take a bit of time; we’ve been at it for two months, give us a bit more time.

JOURNALIST: Are you confident Victoria will come to the party on this? And will you intervene if Senator Wong doesn’t appear to be having any success with this?

PM: I think Senator Wong’s doing a fantastic job and she has my every support, but the discussions with Victoria will be conducted at her level, and in due course, at my level, once we’ve narrowed the gap in terms of the negotiating positions. This is difficult stuff. I mean, there’s competing demands, competing interests, but were not about to leave the people of South Australia in the lurch. That’s why you have from us such a concrete set of water policy commitments prior to the election with money flowing. And this is something which we attach high priority to as well.

JOURNALIST: So you will go to the negotiating table at some point on this issue?

PM: Senator Wong’s handling it in a first class fashion with Victorian counterparts as I said. If it’s necessary I’ll be engaging in that myself.

JOURNALIST: Health Ministers are meeting tomorrow to thrash out the next funding program. You promised to fix all 750 hospitals. Does that start with a fifty-fifty funding commitments between states?

PM: It starts with two things. First of all, right here in South Australia you have as in other states, an elective surgery waiting list which involves a whole lot of people who have been on waiting lists beyond clinically acceptable times. In the past, the National Government has said not my problem it’s your problem. What did we do? Consistent with our pre-

election commitment, we came up and said here is the money necessary to draw down that elective surgery waiting list to something respectable and sustainable during the course of 2008, as an initial investment.

The first COAG meeting at the end of last year we went to the table with $100 million, the states said they needed $145 million to deliver that outcome and we gave them $150 million. That money has been handed over, step one.

Step two is the rest of the system. This is a big project, and I indicated this many times in the pre-election period. And to do it properly, the total reform of the national health and hospital system to eliminate the cost shift, blame shift and mindless duplication overlap, is we do it through a National Health and Hospital Reform Commission. We said we’d get that up and running within the first 100 days of this Government, we announced the head of that Commission, Dr Christine Bennett, only a few days ago. That’s up and running.

Thirdly, once we decide on the future structure of the system, once we decide on who best does what within the overall allocation of health responsibilities within the federation, let me tell you, there will need to be from us, the National

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Government, a significant additional injection of funds. But the rational thing to do is, deal with the immediate problem which is elective surgery waiting lists, set up a mechanism which provides us with advice on the total reform of the system, and thirdly, fund the reforms which are then implemented. That’s the scheme we put forward before the election, we are honouring that commitment and we’ve done it to the letter.

JOURNALIST: You criticise the previous Government for under-funding (inaudible) 46 per cent over the term of the Howard Government. Shouldn’t you bring it up to 50 per cent before you start asking the states to jump through extra hoops in terms of what they have to do?

PM: I take very seriously my commitments to the Australian people before the election. Which is, one, fix the system in terms of system design. And that means the failure to have an effective system when it comes to what GPs do outside of hospitals and what emergency departments do inside of hospitals. Fix the system when it comes to having so many of our acute hospital beds occupied by people who have already been classified to go into nursing homes, but for whom there are no nursing home beds.

Fixing these basic design features as we said we would before the election through a National Health and Hospital Reform Commission. And in addition to that, once those recommendations are through, and endorsed and on the process to implementation, for funding then to flow.

That is what we committed to, in addition to the allocation of funds which came from our pre-election hospital fund of which that $150 million for elective surgery, that’s already been committed and delivered.

JOURNALIST: What’s your reaction to the Queensland Health Minister’s statements today that you may have to take over the public hospital system?

PM: Well look I’ve always said I’m pretty blunt about all this. We have, and I said this before the election, we will give ourselves until the middle of 2009 to determine whether through the National Health and Hospital Reform Commission, and through our negotiations with the States and Territories, we can come up with the best design of the health system possible for the benefit of working families right across the country.

My preference is to do that cooperatively. If we can’t get there co operatively, I am dead serious about the alternative option which is to go to the Australian people and to seek a mandate from them for the Commonwealth to take over the system. I said that beforehand, I haven’t backed away from it, and I said we would reach that decision by the middle of ‘09.

JOURNALIST: He’s indicating that you may need to move before that?

PM: Well Rome wasn’t built in a day, and I did say prior to the election what time frame was rational to do this within. And once again I honour that commitment. We said we would reach that conclusion by mid ‘09. Last time I looked at my watch, it was the end of February ‘08 and I think that gives us a bit more time to work it through.

Let’s be serious about it also. Look at the complexity of this, in terms of the number of stakeholders in the health and hospital system. Preventative health care; primary health care through GPs and community health care; what happens with accident emergency departments in hospitals; what happens at the acute end and surgical end of the hospital spectrum; aged care; mental health; dental health; workforce planning; doctors; nurses; long term supply.

It would be great if you went, bang, fixed today. But pre election I said we will work this through over an 18 month period and we have been in office for just over two, heading on towards three months.

JOURNALIST: How do you react to Paul Lennon’s claims of blackmail to do with the Mersey Hospital (inaudible)

PM: Well once again, I take pretty seriously honouring my commitments to the Australian people and the good people of Tasmania made before the election. I said then that those monies would be dedicated to particular health needs in Northern Tasmania. Pardon me for honouring my commitments to do that.

JOURNALIST: They are marginal seats though.

PM: Well my pre-election commitment was, explicitly, to deliver that funding to those communities spread right across the North of Tasmania, where there are acute health needs, particularly in terms of type two diabetes. I was in Launceston only two days ago and looking at the renal dialysis unit at Launceston General Hospital.

But in terms of the broader health needs of Tasmania, these are subjects of continuing negotiations between ourselves and the Tasmanian Government and I am sure we will sort these things through. But again, I am here to say that two or three months into this Government’s life, we take seriously what we committed to before the election, including to the people of Northern Tasmania. All out there on the record.

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If I was to do something different now, you would be saying, ‘why have you broken your promise’. I don’t intend to do so.

JOURNALIST: Prime Minister, before the reception you were campaigning strongly for workers rights. Are you concerned about the South Australian State Government’s move to cut workers, injured workers’, entitlements under the WorkCover shake-up, I guess?

PM: I am across a few things at present; I am not quite across that one. I will take that one on notice.

JOURNALIST: On other matters, another issue, reports today that there has been a split in Opposition ranks federally, perhaps backing away from nuclear energy. Have you got a reaction to that?

PM: Well on the nuclear front, I find it pretty interesting that, here we have a statement from someone senior in the Liberal Party. The Age says today, a spokeswoman for the Leader of the Opposition says, “Coalition policy is to investigate the possibility of nuclear energy.”

Pre-election, they said that this was a part of Australia’s future. That is, Australia to have civil nuclear reactors across the country pumping electricity into the electricity grid. That’s still their policy. Unless Dr Nelson wants to announce that it is suddenly a changed policy.

Prior to the election, the Liberals said that they were committed to a nuclear energy option, a nuclear energy future for Australia. Prior to the election they committed themselves to a nuclear energy option for Australia. Dr Nelson is still saying that’s what they are proceeding with. Unless they’re now, about to change policy on that, like they have said - they have now changed policies on Iraq, and Kyoto and maybe WorkChoices, but maybe not all of WorkChoices, and maybe a few more things before lunch time.

JOURNALIST: Prime Minister, ABC Learning. Has the Government got a contingency plan if this massive child care operator goes belly up?

PM: As you know the Government is strongly committed to the proper provision of childcare to working families, and we put forward a range of policies on this prior to the election. And we think this is a core area for working families, particularly when it comes to workforce participation. That is why we committed to increasing the childcare rebate from 30 per cent to 50 per cent. That’s why committed to an additional 260 childcare centres across the country. That’s why we committed also to providing fee relief those starting to become childcare workers.

In terms of the substance of your question, the Government and relevant authorities continue to monitor closely developments regarding ABC Learning Centres.

It is inappropriate for the Government to comment on the financial aspects of the company. The Government remains committed to working with providers to deliver affordable, accessible and high quality childcare for Australian families. And our concern is always to ensure that working families have access to quality childcare services.

JOURNALIST: But if it does run into trouble are you going to have an immediate short term problem, you can make as many promises as you like on child care, but, you’re going to face a decision (inaudible)

PM: Well I think it is pretty important to say to working families across the country, whatever childcare services that they access, that their child care rebate will go from 30 per cent to 50 per cent. That is a very large addition. That is not simply, quote, ‘a promise’, that is being delivered. If you were to ask Mums and Dads whether that was important or not, I think they would say that it’s pretty important, together with the other supply side measures on extra centres and extra staff that we mentioned.

In terms of the commercial matters that you raised, then they fall within the end of the comments that I just made.

JOURNALIST: Do you fear that the Federal Government will have to get involved, though Prime Minister?

PM: I think it is very important that we at the level of National Government monitor developments closely, and I go back to my earlier comments on the most recent matters.

Lastly, can I just say, as far as the MTA in South Australia is concerned, I just am very impressed with what goes on at this centre. You have got, based on my advice, 600 young people at any one time, either year one, year two, year three, year four, accessing these first class facilities to train South Australians into this area of acute need in the local economy.

Talking to the young men and women here, they are benefiting greatly by the training services provided. As the new National Government, we want to partner with first class operations like this run by the MTA, because it is part and parcel of producing the most skilled economy in the western world. That is our national vision, good to see it is being applied here locally. Thanks for your time.

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