Title

Prime Minister discusses the Australian economy; the Native Title bill; private health insurance; nursing homes; the Indonesian economic rescue; and taxation reform.

Database

Electronic Media Monitoring Service 

Date

01-03-1998 09:38 AM

Source

Win

Parl No.

 

Channel Name

Win

Start

01-03-1998 09:38 AM

Abstract

Hon. J. Howard MP : Cover story - Saddam Hussein's hidden billions.

End

01-03-1998 11:55 AM

Cover date

1998-03-01 09:38:38

Citation Id

773696

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Reporter

OAKES, Laurie

WALEY, Jim

Speaker

HOWARD, John, (former PM)

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Open Item 

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No

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False

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emms/emms/773696

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Prime Minister discusses the Australian economy; the Native Title bill; private health insurance; nursing homes; the Indonesian economic rescue; and taxation reform. -

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Prime Minister discusses the Australian economy; the Native Title bill; private health insurance; nursing homes; the Indonesian economic rescue; and taxation reform.

NATIONAL NINE NETWORK SUNDAY 9.36 AM 1st MARCH I998

DISCUSSION ON THE WIK BILL, AGED CARE AND THE UPCOMING FEDERAL ELECTION, THE CRISIS IN INDONESIA, TAX REFORM AND OTHER ISSUES. INTERVIEW WITH PRIME MINISTER JOHN HOWARD.

JIM WALEY - PRESENTER

Tomorrow is the second anniversary of John Howard's election as Prime Minister. It's also the start of the Autumn Session of Parliament. As well as the native title laws, two other bills which have already been rejected once will go back to the Senate, providing more triggers for an early election.

Well, Mr Howard is in our Sydney studio this morning, and here to talk with him is Sunday's political editor, Laurie Oakes.

Good morning, Laurie.

LAURIE OAKES - REPORTER: Good morning, Jim. Mr Howard, welcome to the program.

JOHN HOWARD - PRIME MINISTER: Always good to be here, Laurie.

OAKES:

Your first year was pretty good for the government. Second year was horrible. What's your prediction for year three?

HOWARD:

0h, great. And I ... the portents are good for the Australian economy. Despite the troubles in Asia, the Australian economy is still powering ahead. We had some figures on tourism, for example, on Friday, which showed that after a fairly poor November and December, we picked up quite strongly in January. Now, that's only one month, but I would have thought they would have been worse. Car registration's strong. Business investment's strong.

So the message very clearly is that although we'll be affected in some way by the Asian troubles, the underlying strength of the Australian economy, the recognition that having inherited a deficit of ten and a half billion from Labor, we're now heading for a surplus, there's a recognition there ...

OAKES:

Does that ... does that mean you'll win the election?

HOWARD:

Well, I don't know. That's up to the Australian public. But the fundamentals of the economy are very strong. And we are weathering the storm. And thank heavens we took the measures we did in our first two budgets, because if we hadn't have then the Australian economy would now be a lot more vulnerable.

OAKES:

Could you lose this election?

HOWARD:

0h, anything can happen in politics. We live in an age of great political volatility, and large majorities are always deceptive because they rest upon tiny margins in a large number of seats. So my message to the liberal Party, don't assume that when you've got a majority of forty-four that you're invincible. The Australian public doesn't like to be taken for granted, and I certainly won't take the Australian people for granted. I will work very hard over the next twelve months, or whatever the period may be, to retain and to build upon the respect that I hope my government, has.

OAKES:

One of the things that will influence the length of that period between now and the elections is the Wik bill. Parliament resumes tomorrow. When will that bill go back to ... [indistinct]...

HOWARD:

It'll go back during the first two weeks. I think we have to wait till the seventh or eighth of March, which is the three month period from the time it was rejected by the Senate and laid aside by the House of Representatives, and then we'll re-introduce it.

OAKES:

Senator Harradine says that it'll be delayed until May. Does that matter to you? Does that affect the timing of an election?

HOWARD:

Well, I can't understand why anybody would want to delay it any longer except to win votes. I think the Australian public wants this dealt with, because the bill that we're putting back in the next two weeks will be, in substance, the same bill that was up there before. So whilst people may rely ... Labor and others may rely on a technicality to string it along, I don't think the Australian public wants that.

And we saw yesterday in a story in The Sydney Morning Herald by Alan Ramsey pretty clear evidence that the Labor Party, for political reasons, thinks there's some mileage in having a double dissolution on this. It rather explodes the theory that they've been running with, that their stand is based on high principle and moral outrage about the alleged ill treatment of Australia's indigenous people.

We've got a fair bill. It's a balance. It's a compromise. We've already given in a lot to get a fair compromise. And I think the Australian public wants the thing dealt with.

OAKES:

Wouldn't it make sense, though, to wait until after you get the result of the Hindmarsh Island Bridge case in the High Court? I mean, that will affect the ... the constitutionality of the Wik bill, won't it?

HOWARD:

No, it wouldn't for a couple of reasons. There could always be some argument that we're not now aware of that might be advanced in a couple of months time why we should wait for something.

Governments are elected to govern. And the Australian public is tired of the time that's already been taken on this measure, and they just want it dealt with.

OAKES:

Well, one of the big domestic issues in that election campaign, whenever it is, will be health. Health fund premiums are going up today by an average of eight point one per cent, I think. That's not going to be popular electorally.

HOWARD:

Well, no increase is popular, but you've got to bear in mind that health insurance premiums would have been even more expensive if it hadn't been for the tax incentive that we gave from the first of July last year.

OAKES:

But despite ... despite that ...

HOWARD:

We have a guarantee ...

OAKES:

... more people are leaving than are signing on.

HOWARD:

Well, the reason for that, Laurie, is that something wasn't done about this problem five years ago. When Graham Richardson ... [indistinct]...health, yes.

OAKES:

But your six hundred million dollars worth of incentives hasn't worked.

HOWARD:

Well, I don't… I don't agree that it doesn't work. The situation is, is that if we hadn't given that incentive, the situation now would be a lot worse because in 1990. Graham Richardson as health minister warned the then Labor government that if they didn't take steps to stabilise membership of health funds at the then level of thirty-eight or thirty-nine per cent, they'd continue to fall. And Labor deliberately neglected it. And by the time we got in, the level of membership had fallen to a dangerously low figure.

Now, we have stabilised it. It is very difficult. And I recognise that. But I think it's also important to understand that the malign neglect of the former government allowed the level of memberships to run down to a very dangerously low point.

OAKES:

But you're in government now. Are you looking at further options to shore up private health insurance?

HOWARD:

Governments are always looking at options to strengthen the health system. And for all its weaknesses, and it has some, we still have a health system in Australia that is much better than most other countries. Much better than the American or British systems.

OAKES:

But can I be specific? Are you looking at extending the one per cent Medicare levy surcharge to lower income?

HOWARD:

Well, there's a range of options we're looking at. I'm not going I'm not going to be any more specific than that.

OAKES:

You don't rule that one out?

HOWARD:

Well, I'm just saying we are looking at a range of options.

OAKES:

What about giving employers a fringe benefit tax concession on private health insurance that they pay for?

HOWARD:

There are a number of things that we're looking at. And I'm not going to be any more specific than that.

OAKES:

Well, all right. Well, let me ask you a more general question. Is Medicare in danger?

HOWARD:

No.

OAKES:

So, you guarantee that if you win the election, for the next three years Medicare will remain unchanged?

HOWARD:

Well, the essentials of Medicare will remain unchanged, of course they will, of course they will.

OAKES:

Why of course?

HOWARD:

Well, because the basic Medicare system has wide support in the Australian community, and given the Australian experience and the Australian expectation, the best health system is to have the, what you might call the safety net of Medicare, with a strong private component as well. And you want a balance. And that is what the Australian public wants. And it's a fair system.

OAKES:

A related issue. Aged care and nursing homes. You alienated elderly voters last year with the nursing homes fiasco. Are you going to offer those aged voters anything between now and the election to sweeten them up again?

HOWARD:

Well, I think I'd have to say that areas like that are always under review, and there's always a case for ensuring that the incentives and the support systems that are available, and the encouragements that are available for retired Australians are adequate given the circumstances. They are living now in a climate of much lower inflation, which gives them stability. But they're also living in a climate of lower interest rates, which while that may be good for home buyers, it's not so good if you're living off fixed interest investments. So they'll always be kept under very careful consideration by us.

OAKES:

Increased daily fees for new nursing homes residents go into effect today, although there's a twenty-eight day period of grace ...

HOWARD:

Yes. It will only affect potentially no more than thirty-five per cent of new entrants, because it only applies if you've got the pension plus more ... fifty dollars more on top of that. It only begins to apply then. So it's a very ... it's a very fair system.

OAKES:

You don't think that will renew the opposition from the elderly that ... [indistinct] ... ?

HOWARD:

No, I don't. I don't think. it will, because I'll still be able to say that something in the order of sixty-five to seventy per cent of the total cost of keeping somebody in a nursing home is met by the government, and therefore by the general body of taxpayers. And what you've got to do with these things is to strike a balance. I mean, if people can afford, and their families, in particular, can afford to make a small contribution towards their care in a nursing home, then it's not unreasonable that be asked for. And this is a principle the Labor Party embraced ...

OAKES:

Well, the Labor Party now says you should ditch those principles.

HOWARD:

Yeah, well, the Labor Party wants to ditch everything and is offering all sorts of concessions, and sooner or later the Labor Party will have to explain where the money's coming from. I notice Mr Beazley the other day was saying that if he was Prime Minister he'd have a surplus. Well, it'd be the first time for a number of years, because when he was finance minister, he told us he had a surplus, and in reality, we had a deficit of ten and a half billion.

You can't go on promising to abolish this and abolish that and to give this and to give that, and then, at the end of the day say, oh, yes. but we're also going to have a surplus, and on top of that, in case you've forgotten, we're going to cut your tax in half. Now, that is fundamentally the dodgy bid of goods the Labor Party is selling the Australian public at the moment and I think as we move into this year, the focus will turn to Labor, and the impossibility of the economic position it's taken will become more apparent.

OAKES:

You ... you're obviously out to woo the elderly voters back, so what do you think of the action of your back-bencher Gary Nairn, charging pensioners two dollars to come along and have tea and scones and listen to him talking about Government policy?

HOWARD:

Well I ... I'm not going to answer for the actions of every individual action of an individual member. I don't know whether ...

OAKES:

But just this member and that action?

HOWARD:

Well, let me say this. If, you know ... charges for things like that are probably not wise.

OAKES:

The election year problems include overseas problems. You mentioned the Asian economic crisis. We now have experts who say that this prune at least one per cent from our growth this year. You disagree with that?

HOWARD:

Well, it's too early to say Laurie. It will obviously have some impact. At this stage our advice is that it will be lower than that, but we'll still have very strong growth. I mean, at the moment we are probably experiencing growth of between three and three-quarters and four per cent, which is a tremendously strong economy. Now, later on this year there may be some flowthrough which will knock some of that off, but it's a little too early to tell.

OAKES:

Is that an incentive to go to the polls quickly?

HOWARD:

Oh, you take a number of things into account Laurie. And I'm not here to announce the election date, I'm sorry to disappoint the Sunday program and you personally, but I'll go to the election at the right time.

OAKES:

Does Australia have a game plan to try and ease the social disruptions occurring in Indonesia?

HOWARD:

Yes we do.

OAKES:

Well, what is it?

HOWARD:

Well, that game plan really involves firstly making sure that the thrust of the IMF package is maintained, but also ensuring that the IMF adopts sufficient flexibility in relation to such things as food subsidies, to ensure that the social disruption is not too great. It also involves contact with the World Bank to ensure that there's a mobilised and coherent effort of donor countries to help in the food aid area. It's also to constantly put the view to President Soeharto that, in the long-term interest of Indonesia you must implement the reforms that have been asked of him by the IMF.

OAKES:

Should you go to Jakarta to put that to him?

HOWARD:

Well I've ... I've been in contact with President Soeharto since I last saw him in October, and I mean ... you may remember that the Asian trouble started before the last couple of months, and I was in fact in Octo... in Jakarta in October. And I made it very plain to him through our offer of one billion US dollars for the rescue package, that we were being a very strong friend.

I mean, Australia is the only country that has participated in the three rescue packages in the Asian Pacific region, and we really are now seen as having played a very major part in helping, as a friend and a regional mate, the difficulties of these countries.

OAKES: But now you want the IMF to help prop up the banking system in Indonesia I mean, how do you ... how do you achieve that?

HOWARD:

Well, no, well, I want them ... well, actually I want the banking system in Indonesia reformed. And the problem in many of these countries is that their banking systems are not transparent enough. And what we've got to do is persuade the countries of the region to reform their banking systems. In the process ... it's got to be done in a way that doesn't cause too much social unrest.

And if the price of your food goes up by, in some cases, two or three times, no matter what the country is, you'll have great social angst. I mean, that would happen in Australia. And we've got to understand the delicate balance that now exists in Indonesia, and Australia should draw on her reserves on a forty-year association with that country. And we've already done that. I mean, the Americans have adjusted some approaches as a result of views that we've put to them, and the best way you handle these things it sometimes talking privately, and doing things that don't attract the glare of publicity.

OAKES:

A tot of the ... the butt of these ... the social angst you refer to is obviously the ethnic Chinese business people in Indonesia. There's a very strong suggestion that some of those will want to come to Australia. Are you going to look at the immigration program. to try and fit them in?

HOWARD:

Well, we don't have any, particular plan to do that, because at the moment there is no evidence of that occurring, though let me say that we would be appalled if the Chinese were in any way discriminated against, absolutely appalled.

OAKES:

Would we give them refuge as business ... [indistinct] ... ?

HOWARD:

Well, we would have ... we would ... we have a humanitarian refugee program Laurie, and that applies all the time, no matter where people are coming from.

OAKES:

What about the general question of migration? Jeff Kennett and the Business Council of Australia have suggested we should expand immigration to sustain growth levels and compensate for loss of growth through the Asian economic crisis. Is there merit in that argument?

HOWARD:

Not necessarily. I mean, it's something that we keep under review. What we've done is to shift the balance of our migration program steadily towards skilled migration and away from family reunion. If an economic case builds for higher migration, well, we'd embrace it. But at the moment we think the balance is, of immigration, at the present level is about right for the economy.

OAKES:

Tax reform, obviously the big election issue. Now, Labor's already started targeting small business people here, warning that they'll bear the brunt of a GST, they'll become the tax collectors. What are you going to do about that?

HOWARD:

Well, we'll be releasing a comprehensive plan, and we'll be saying to the Australian public, and we'll be saying to small business that this country needs a new modern taxation system. I mean, the present wholesale sales tax system is a nightmare for small business. I was talking to small businessmen in Darwin a few days ago, and they said please get rid of the wholesale sales tax system because it is so cumbersome and so expensive and so inequitable to administer.

I mean, if you're a small businessman, you find the, you know. the variations of wholesale sales tax so confusing and mind boggling and costly that I think you would embrace a new, simplified, uniform system.

OAKES:

Well, that didn't happen in '93 of course. Would you offer ...

HOWARD:

Well I don't ... I think there's been a bit of rewriting of history about what caused our defeat in '93.

OAKES:

Well, Andrew Robb says he went into his local hamburger joint after the election and then confided he'd voted against the liberals because he didn't want to have to buy a new tax [sic] reg… cash register.

HOWARD:

Yes, well that's just one example and, I mean, I don't think… I don't think you do proper analysis based on one anecdote, Laurie. I…

OAKES:

Well, Andrew Robb goes on ...

HOWARD:

Well, I've also seen a lot of the other research that Andrew Robb did after that, and…

OAKES:

Well, he was, you federal director…



HOWARD: Yes, I know he was, but this proposition, that we lost ninety in '93 just because of the GST, is nonsense.

OAKES:

Well, he goes ... went on in hi... in a column recently to say that you would include in your tax reform package measures to eliminate the cost to small business of switching over to and administering a GST. And he said if you didn't, the GST may again land the Coalition a fatal punch.

HOWARD:

Yeah. Well, I have to confess I didn't read that column, but he's not basing that on any knowledge.

OAKES:

So you won't be?

HOWARD:

No. I'm just saying that he doesn't know anything about what's going to be in our tax package. That's what I'm saying.

OAKES:

Well, tell us, will you be doing that?

HOWARD:

... [Laughs]... No, I'll tell you that we will release a comprehensive plan to reform the Australian taxation system that will cut personal income tax. It will address the ramshackle, old-fashioned depression-era wholesale sales tax system. And it will also give us a competitive corporate approach in the area of taxation.

I mean, the Labor Party is turning backwards and inwards, and reaching back to the I950s in opposing tax reform. They know that we need a new taxation system. Now, if they want to run a negative fear campaign, go ahead and do so. It may win them a few cheap votes, but in the long run they'll dishonour their role in the Australian political firmament, and they will turn their faces agest [sic] ... against the reforms that this country needs. I know embracing tax reform is seen by some people as adventurous, but it is what this ...

OAKES: But you call it an adventure.

HOWARD:

Well it is, I think it's very important. I mean, this country needs a new industrial relations system, and we're giving it to them, and it also needs a new taxation system, and it also needs a full-blooded approach to privatisation of companies and activities government shouldn't be involved in. I think governments are elected to do things for the long term future of the country, and that's why we're determined to fix the tax system.

OAKES:

We're just about out of time. I want to ask you about the new judge in the High Court, lan Callinan. He's now stood aside from the Hindmarsh Bridge case after the Opposition brought to his attention documents that showed he'd made an incorrect statement from the Bench. Why didn't the Government do that?

HOWARD:

It's correct in all of these circumstances for the judge himself to make the decision.

OAKES:

But the judge made his decision ...

HOWARD:

No, no, no ...

OAKES:

He says ...

HOWARD:

I'm sorry.

OAKES:

… on an incorrect recollection ...

HOWARD:

I'm sorry. Now you, you know… I'm sorry Laurie, but you've just got to let me finish. The judge made his decision, in our view, with all of the material facts before him. And it is not our role to criticise his decision. I mean, the Labor Party …

OAKES:

I'm not asking you to criticise him ...

HOWARD:

Yes you are ...

OAKES:

…but the judge himself said he made the decision because his memory was faulty. The Attorney-General knew his memory was faulty, and the Attorney-General had the document that showed it, but kept quiet.

HOWARD:

No. I'm sorry Laurie. What ... you know ...

OAKES:

Now, would Daryl Williams stand by ...

HOWARD: NO, no, no. What are you ... you're going to get the answer ...

OAKES:

…and watch someone being mugged and not do anything?

HOWARD:

Now, are you going to well, are you going to let me answer it?

OAKES:

Yeah sure.

HOWARD:

Right. I mean, you say the Attorney-General knew his memory was faulty.

OAKES: Yes.

HOWARD:

How do you know the Attorney-General knew he was… his memory was faulty at the time he made his original decision?

OAKES:

Well, he should have known it soon after ... [indistinct]...

HOWARD:

No, no, no, no. I'm sorry. Isn't that the material thing,

OAKES:

No. Don't ...

HOWARD:

I mean, they ... surely the Attorney-General was entitled to assume that if Callinan had written a letter to X then the knowledge of that letter having been written to X would have been presinent [sic] in ... present in Callinan's mind when he took his original decision. So in those circumstances you have no right at all to criticise the Attorney-General.

OAKES:

But you see, if the Attorney-General assumed that, then he would have also been assuming the judge was telling a porkie.

HOWARD:

No, he wouldn't.

OAKES:

Why not?

OAKES:

No, no, because he would have rightly concluded that Callinan had taken that into account in reaching his decision as to whether or not he should remain on the court. You see, if the principle is that it's for the judge and the judge alone to decide whether he stays on the court, what you're really asking, and what Bolkus is asking, is that the Attorney-General should second guess a decision made by a judge, which defies the whole doctrine of the separation of powers, which is the cornerstone of our Constitution.

OAKES:

But if Nick Bolkus can point out to the judge that he's made an error, the Attorney-General can. And my contention is that by not doing so the Attorney-General has left the judge looking a bit of a dill.

HOWARD:

No, no. My contention is that you are ... you are assuming that a knowledge in the mind of the Attorney-General that you have no right to assume, particularly at the time the judge took his original decision.

OAKES:

Mr Howard we thank you.

HOWARD:

Pleasure.

OAKES:

Back to you Jim

WALEY:

Thank you Laurie. The Prime Minister talking there with Laurie Oakes.