The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
Picture of Peter Costello

Peter Costello

Treasurer

11 March 1996 - 3 December 2007

Transcript of 27/07/2005

Interview with Neil Mitchell
3AW

Wednesday, 27 July 2005
8.35 am

SUBJECTS: Iraq, industrial relations, Steve Vizard, terrorism, Maria Korp

MITCHELL:

Mr Costello, good morning.

TREASURER:

Good to be with you Neil.

MITCHELL:

How would you look in a flak jacket?

TREASURER:

I have worn one before, I don’t look any better.

MITCHELL:

Do you think the Prime Minister risked his life going?

TREASURER:

Quite possibly, you have got to remember that there are people in Iraq who have surface to air missiles and they can hit helicopters. Of course helicopters have got evasion mechanisms and they’re armed themselves but it is a dangerous situation and the reason why it was kept quiet until it was more or less over was because there was a real risk, yes.

MITCHELL:

Did you know he was going?

TREASURER:

Yes.

MITCHELL:

Were you edgy about it?

TREASURER:

Well he mentioned it to me before he left Australia and it was on the basis of course that this be kept very quiet because the last thing you would want terrorists to know is that an important head of Government is flying into Iraq because they would probably be taking shots at everything that moved in the sky.

MITCHELL:

Is it worth it? Is it worth it for a Prime Minister to risk his life to do something like that?

TREASURER:

I think it is worth it, yes, to one, speak to the Iraqi PM and secondly to see the troops. You have got to bear in mind that other heads of Government from Britain and America have done it too. You wouldn’t want to do it too often but I think it is worth it to discuss the situation and also to show support for our troops. Our troops are they, there are the people that are in the firing line and to go and to talk to them and to thank them for their efforts. I think is important to them.

MITCHELL:

So it is a brave thing to do?

TREASURER:

Yes.

MITCHELL:

Let’s start with industrial laws. The industrial laws we know about at the moment, is this just the beginning, is this just the start of industrial law reform?

TREASURER:

Look, the way I look at it is industrial relations reform really began back in 1996. Peter Reith was the Minister you would recall. We managed to get some good reforms in place but it is an on-going process and now we are returning to the issue to do some more. And the more you reform industrial relations the more jobs you will have in Australia and the higher wages will be.

MITCHELL:

So do we have to keep going? This is just the beginning.

TREASURER:

So we have to keep working at improving industrial relations.

MITCHELL:

Do you want to see a situation where the unfair dismissal laws are removed even for businesses above 100 employees?

TREASURER:

Well let me make this point, a lot of people say if there are no unfair dismissal laws then people can be sacked without cause. That is not the case. There are still the laws that protect you against unlawful dismissal. It is quite a different thing. You can’t be sacked on the grounds of family responsibility or race or union membership or political affiliations. That all stays, that stays for everybody. What the Government has put forward is a proposal that the additional legal mechanism, which is giving rise to far too much litigation of unfair dismissal, won’t continue in addition to that and 93 per cent…

MITCHELL:

So would you extend…?

TREASURER:

…of businesses. Now, the point I made when I was doing an interview with a business magazine is that if that worked well and if everybody was happy with it and if everybody said in some time to come that you know, rather than the 93 per cent, it could be extended further, of course you would look at that but that is not the proposal at the moment.

MITCHELL:

I understand it is not the proposal but is that the way we should go in your view?

TREASURER:

Well I think what we ought to do is we ought to proceed with this round of industrial relations reform and then I think we ought to sit back and we ought to see whether wages have increased by a greater amount, I think they will have, whether the number of jobs have increased, I think they will have and in years to come when you are thinking about increasing wages again and you are thinking about giving more jobs again, you will review things in years to come but that is a long way down the track.

MITCHELL:

How long?

TREASURER:

Well I don’t think this round is going to start until 2006 so it is probably next decade.

MITCHELL:

Do you accept that workers will lose an automatic right to meal breaks and to be paid for public holidays, an automatic right will be lost under these laws?

TREASURER:

Well the Government has guaranteed particular terms and conditions – annual leave, carers leave, parental leave, ordinary hours…

MITCHELL:

It doesn’t say anything about meal breaks and public holidays.

TREASURER:

…and the idea is to guarantee wages and those conditions and then encourage bargaining over and above. Can I say to you Neil, many people have already bargained in relation to these matters.

MITCHELL:

Will they have to bargain for a meal break?

TREASURER:

Well no, hang on, ten years ago you used to have awards that specified smokos, you know, start, smoko, morning tea, lunch, afternoon smoko, finish. Many people have already bargained in relation to those smokos and they finish earlier. So instead of having you know, two smoko breaks of 15 minutes each, you don’t have a smoko break, you get the same wages and you finish half an hour earlier. Now, you don’t want to ban that.

MITCHELL:

Well, so people could trade off their lunch hour to knock off earlier?

TREASURER:

Well there are some people that take of an hour for lunch rather than an hour.

MITCHELL:

So, let’s come back to this, meal breaks will need to be bargained by people?

TREASURER:

Meal breaks are bargained at the moment.

MITCHELL:

Okay.

TREASURER:

That is my point, meal breaks are bargained at the moment.

MITCHELL:

Public holidays?

TREASURER:

In relation to public holidays, I think there actually is a lot of bargaining going on at the moment in relation to public holidays but in relation to public holidays you get additional payment. A lot of people work on public holidays at the moment.

MITCHELL:

Yes but you will have to bargain that too, that is not going to be guaranteed.

TREASURER:

Well hang on, that happens at the moment.

MITCHELL:

Okay, well I don’t know why you are introducing these changes then if everything happens at the moment, but what we are saying is that under this new system you will have to bargain for meal breaks and for public holidays?

TREASURER:

Under the new system you will have the right for higher wages, to bargain in relation to hours as you do at the moment.

MITCHELL:

Well…

TREASURER:

And you would be foolish Neil, if you took away those rights because it is going on to a very large degree at the moment.

MITCHELL:

…well that does open the situation though with these new laws with the employer saying no, we don’t want you to have lunch breaks. You are going to work eight hours straight whether you like it or not and this is what we pay.

TREASURER:

Well no, what will happen there…

MITCHELL:

What is the protection there?

TREASURER:

…ordinary hours are set and when you go outside the ordinary hours then you have the opportunity for additional amounts.

MITCHELL:

But are you going outside of the ordinary hours if you just work the ordinary hours without a meal break?

TREASURER:

Well you do if you work long hours like that, you do.

MITCHELL:

You are not working long hours, you are just dropping a meal break.

TREASURER:

Neil, there are many people that are quite willing to do that, I don’t know about…

MITCHELL:

But what about…?

TREASURER:

…office workers, hang on, hang on , Neil, how many office workers today stop for a smoko? Not many. And do you know the reason why? The reason why many of them are much happier to work, say a 36 hour week without smoko is because you leave for home earlier than to work a 36 hour week with smokos. Now, what we want to do is we want to give people maximum flexibility in relation to hours and the right to negotiate and you would be foolish if you took away that right to negotiate.

MITCHELL:

If I am a boss, will I be able to say to my worker, I want you to work eight hours straight or seven and a half or what ever it is, no lunch break, that is how I want you to work?

TREASURER:

No you won’t be able to. If you are a boss you will have to make an offer which your employees want and if they don’t want it, they won’t accept it.

MITCHELL:

And they won’t have a job.

TREASURER:

No, no, they can go back to the statutory protections.

MITCHELL:

And that statutory protection says nothing about meal breaks and…

TREASURER:

By the way…

MITCHELL:

…that statutory protection says nothing about meal breaks and public holidays.

TREASURER:

…and by the way Neil, you said they won’t have a job. Can I tell you this…

MITCHELL:

Well they may not.

TREASURER:

…well hang on, Neil, unemployment is lower today than it has been for 30 years, now let me finish this point, it is an important point…

MITCHELL:

Well yes…

TREASURER:

…no, it is a very important point…

MITCHELL:

…you are avoiding the other point.

TREASURER:

…no, no I am not. The big debate in this country has been labour shortages, that is employers are finding it hard to get enough employees. The idea that if you are an employer today you can put people out of work has been less true today than it has been for the last 30 years because employers in fact, are finding it hard to retain people for work.

MITCHELL:

Do you accept that that statutory protection you are referring to, the minimum standard says nothing about meal breaks and public holidays?

TREASURER:

What I say is that these are matters for negotiation, that people like the flexibility, that they should have the right to negotiate these things and that when they do so they are likely to get higher wages.

MITCHELL:

But that wasn’t the question. Do you accept that the statutory protection does not refer to meal breaks and public holidays?

TREASURER:

The statutory protection guarantees conditions and allows you to negotiate over and above those conditions…

MITCHELL:

Does it cover meal breaks and public holidays?

TREASURER:

…and that is the answer to your question. It gives you the right as I said earlier, if you don’t want to have a smoko or a meal break, it gives you the right to cash it out to either leave earlier or to get higher wages.

MITCHELL:

Does it protect meal breaks and public holidays?

TREASURER:

And in that sense of course it protects them.

MITCHELL:

How?

TREASURER:

Because it gives you the right…

MITCHELL:

Gives you the…

TREASURER:

…let me say it for the fourth time. It gives you the right, if you want to, to negotiate an earlier time to leave or a later time to start as many people have already done and in doing so to get higher wages.

MITCHELL:

Okay. Another issue, a court case was told yesterday Steve Vizard had arranged to send $3 million off-shore to avoid tax. Is he subject to a tax investigation?

TREASURER:

Well, the Commissioner of Taxation would investigate anybody who he believes he has reasonable grounds to suspect has contravened tax laws.

MITCHELL:

On the basis of that court evidence would that be reasonable grounds?

TREASURER:

Well that will be a matter for the Commissioner but I know that the Commissioner does look at court evidence.

MITCHELL:

Do you think that Steve Vizard will ever re-build his reputation?

TREASURER:

Well let’s hope that if Steve takes the penalty and serves the penalty and if he does commit himself to making restitution for the rest of his life, let’s hope that he can do a lot of good things.

MITCHELL:

He is a school mate of yours, same time?

TREASURER:

Yes.

MITCHELL:

At Carey?

TREASURER:

Yes.

MITCHELL:

Do you have any idea what has motivated him? Why would somebody with so much money do something like this?

TREASURER:

You would have to ask him.

MITCHELL:

Is it greed?

TREASURER:

Well look, you should know, any company director should know this. That if you come into possession of information while you are a director of a company, it is not for your personal use or for anyone associated with you, it is for the benefit of the shareholders of the company and any company director worth his salt knows that.

MITCHELL:

Do you know what the verb, ‘to Vizard’ means?

TREASURER:

No.

MITCHELL:

To disguise. Terrorism, the Premiers are calling for a terrorism summit, is that a good idea?

TREASURER:

If something useful could be done. I think it is important that every step be done at the State level to secure domestic transport. You have got to remember this, the Commonwealth Government doesn’t run railways.

MITCHELL:

Are bag searches a good idea?

TREASURER:

I don’t know about bag searches, but this is a matter for State Governments. The Commonwealth Government doesn’t run railways or buses.

MITCHELL:

But is there a point to a summit?

TREASURER:

We have asked the States to review the arrangements on security they have in relation to state transport systems, that is a matter for them, to make sure that in the light of the London bombing and other events, that they have actually secured and safeguarded. Now, I think it is important that the States report in relation to that and if that is useful, so they can benchmark against each other, that might actually help the effort.

MITCHELL:

What do you think about some of the other radical ideas, one suggestion is a freeze to Muslim migration?

TREASURER:

Well I would say this, I would say that our migration programme ought to be focussed on people who want to come to Australia and embrace what Australia stands for. That is democracy, the rule of law, western law, western courts, western justice.

MITCHELL:

Do we test that strongly enough?

TREASURER:

And if you come from whatever background but you subscribe to those things, you are welcome. If you don’t like western justice or western law or democracy, this is not the country for you.

MITCHELL:

Do we test that strongly enough?

TREASURER:

We ask people when they become Australian citizens to make an oath, pledging themselves to Australia and its laws and its values.

MITCHELL:

We don’t ask them that when they immigrate, do we?

TREASURER:

I don’t think we do…

MITCHELL:

Should we?

TREASURER:

…but I would say to anybody who is thinking about coming to Australia, look, if you don’t like a secular society which has democratic elections and the rule of law and our justice system, if that is not your thing then Australia is not for you.

MITCHELL:

Is multiculturalism to blame in part for the dangers we do face?

TREASURER:

Look, the trouble Neil, is multiculturalism means so many different things. If multiculturalism means you know, enjoying a bowl of pasta and coffee down on Lygon Street and valuing your Italian heritage, we are all in favour of that , absolutely. If multiculturalism means coming to Australia but not accepting democracy and the rule of law in our court system, then that is not a good idea. So it is too broad a phrase to talk about whether multiculturalism is good or bad, the idea of a bit of cultural diversity in Australia is a wonderful idea but we ask people to accept the Australian way of life.

MITCHELL:

Sheik Omran, the radical Sheik in Melbourne has repeated his claims today that the Americans were behind the attack on September 11th on New York, something the Prime Minister has criticised him on. Do you think he should shut-up on this?

TREASURER:

Well actually, no I don’t think he should shut-up. I think he should examine the facts and change his mind. What I would like to see Sheik Omran say is: “I feel very sorry for the thousands of people who lost their lives in the attack of the World Trade Centre, I know it was done by extremists with a perverted view of Islam and what’s more it was incited by Osama bin Laden who I condemn absolutely along with the ideology that lead to the death of those thousands of people.” That is what I would like him to say.

MITCHELL:

Can I ask you about something else, the Maria Korp case, I was talking about it earlier. This is awful when we have a situation where a person is effectively allowed to starve to death. I mean it is legal and it is deemed necessary. Is it not time that we reviewed the laws that govern this, that we face the euthanasia debate?

TREASURER:

Well we have had a euthanasia debate, don’t forget that. Neil, look this is a tragic situation and you feel so sorry principally for the lady, Mrs Korp and her family. But there must come a time where you think that somebody, medical evidence tells you somebody will never recover. This happens in hospitals all the time and at that point hospitals do make these decisions. What makes it worse in this case I think is two factors, one is you can’t rely on her next of kin because her husband is charged with attempted murder and normally you would go to the husband and you would ask him his view and you can’t do that in this case, can you, because he is charged with her murder or attempted murder I should say. And the second thing is normally there is a much longer interval Neil, you know, you think of the Schiavo case, it was years before this matter came (inaudible) so, there are two things that make it different but this does happen in our hospitals…

MITCHELL:

But what is the difference between removing her tube and letting her dying naturally and giving her an injection to let her die?

TREASURER:

Well I guess the difference is that if you remove her tube you are leaving it to nature whereas if you give an injection you are actively causing death.

MITCHELL:

I am sorry that we are out of time, there are many other things that I wanted to ask you but not the least about your trip to the deep north. Did you enjoy that?

TREASURER:

It was great thanks, it was a really good time.

MITCHELL:

A new perspective on Aboriginal affairs?

TREASURER:

Yes I think so, I think that there are some things that are working.

MITCHELL:

Did you find an answer?

TREASURER:

The good news is some things are working, a lot of things aren’t working and they have to be changed but there are some things that are working and they are worth encouraging and stimulating.

MITCHELL:

The Prime Minister’s birthday, what did you give him?

TREASURER:

He was in Iraq.

MITCHELL:

Well he is coming back, what are you going to give him?

TREASURER:

Well I think I will go around and have a cup of tea with him and wish him Happy Birthday.