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 23/08/2005

Interview with Mike Carlton, 2UE

Tuesday, 23 August 2005
8.10 am

SUBJECTS: Muslim clerics, Sydney house prices, Telstra

CARLTON:

Peter Costello has told the Australian that radical Muslim clerics should leave Australia if they do not share this nation’s values. It is a good point and one I would imagine that most Australians would agree with. The Treasurer is on the line. Good morning.

TREASURER:

Good morning Mike.

CARLTON:

It is fairly tough stuff. You think of it as sort of love it or leave it?

TREASURER:

Well the point I make is that if you are thinking of emigrating to Australia, you should know that Australia is a democratic country, we have Parliamentary law, it is enforced by our courts. We have equality for women, if you do not like those values then you are unlikely to be happy in Australia. If you do not like those values and you would prefer a society where a sharia law is practised where it is a theocracy, well there are other societies around the world that are like that but Australia is not one of them and you might be happier in one of those other countries.

CARLTON:

It puzzles me that people do come here and then expect to change our values to their values and to live under sharia law. I find that kind of strange. Why would you bother, why come to this sinful pit of iniquity?

TREASURER:

Yes, well, absolutely right. If that is your view when you get here to Australia you are going to be profoundly disappointed. You are going to see it as a very bad society, you might be tempted to rail against it, idealogically some might even be tempted to train against it. And my point is you are not going to be happy here, it might be better to think about going to another country in the first place. There was an interview recently, you probably would have seen it on the 7.30 Report, from Abu Bakr, one of the Melbourne clerics, he said that there are two laws in Australia. There is Australian law and there is Islamic law. Well, the point is there is only one law in Australia. That is the law that is passed by Parliament and enforced by the courts and if you cannot really accept that principle I do not think you are going to blend into Australian society that well.

CARLTON:

Yeah, I cannot argue with that. One of your problems though is young Muslims who have grown up here, they are Australians and they are in every way, shape and form born here, raised here as Australians, when they adopt these beliefs what do you do then?

TREASURER:

Well, that is more difficult because they have grown up here and I was talking about people who choose to come here. It may be that some of them have dual citizenship, I do not know, if you have dual citizenship you can always exercise a choice, can’t you? Your Australian citizenship or your other citizenship. If you do not have dual citizenship it is much more difficult. You are an Australian citizen and I would urge you to live within the foundation of Australia. Now, you know, we do have a constitution, this constitution says that our Government has to be secular, it recognises democratic elections, it institutes independent courts, it gives Parliament the right to make laws and that is not going to change. That is Australia. You can have political differences when inside that framework, but that is not going to change. That is our constitution. That is the society of who we are and if you cannot live with that you have just got to accept it, I am afraid.

CARLTON:

What would you like to see come out of this summit today?

TREASURER:

I would like to see the moderate leaders making it very clear that whilst they are free to exercise their religion they accept all of those values which are laid down in our constitution, which are a foundation of our society and urge their Imams, who are more radical or extremist, to do the same. That is what I would like to see come out of it.

CARLTON:

Yeah, let us hope it does. Right, can I toss you a couple of other questions more to do with your job as Treasurer and so on? Is the Sydney property boom over?

TREASURER:

It is slowing. Yes, all the evidence, and there are different surveys so it gets quite confusing here, but all the evidence shows that it is not going fast, it probably has not grown, and it has probably plateaued in the last year or two.

CARLTON:

You think it has plateaued? Because there are some figures out this morning which suggest that prices have fallen and that the median house price is now below $500,000.

TREASURER:

It could be possible that overall it has come off a bit. You have got to remember Mike that it has come off incredible increases starting around 2000, growing about 20 per cent per anum. So, you just cannot have a market that grows at 20 per cent per anum for a long sustained period. What happens is the higher it goes, the bigger the bust and so it is much better to let some steam out of the market before it over cooks.

CARLTON:

Do you think that is what is happening or will there be a bust at the end of this one as there traditionally is?

TREASURER:

I think steam is coming out, I think it has been coming out for a year or two and I think that is a good thing because if the steam had not been let out of the market then you would have been setting yourself up for a big bust.

CARLTON:

Yeah, but you do not think there will be one?

TREASURER:

No I think it is behaving in a very orderly way. It is slowing, the rate of growth slowed and then it plateaued. It is possible that it may even have come off a little bit but no, there has been no bust.

CARLTON:

Yeah, so that is probably a good result all around?

TREASURER:

It is good news. Over the medium to long term it is good news. Some people say I would have liked to have seen my house appreciate in value by another 10 or 20 per cent, all I can say to them is, if that goes on for too long you will see your house value crash by 100 per cent. It is much better to have gentle increases than the cycle of the boom and the bust.

CARLTON:

Yeah, so you reckon we will be in this sort of shape for a while?

TREASURER:

Yeah, I think this has been happening over the last 12 months, maybe 18, 20 months and I think it has got a little bit to play out. Yes.

CARLTON:

Okay. Next one. What are you going to do if you cannot sell Telstra, if mum’s and dad’s do not want a bar of it?

TREASURER:

Well, we will face these issues one by one. The first thing is, do we pass the legislation? We cannot sell any shares unless you pass the legislation. So, let us assume, although you know nothing substantive, let us assume that is goes through.

CARLTON:

Do you reckon Barnaby will come in alone and rescue it?

TREASURER:

I do not take anything for granted.

CARLTON:

Not with Queensland Nationals, no.

TREASURER:

Let us assume that it goes through, well then that is the authorisation. What you then do, and we did it with Telstra before, is you have a look at the prospects of the company, you have a look at what else is going on around the world, you see what the demand is and you pitch an offer accordingly. Now…

CARLTON:

But my point is last time you pitched the offer it was $7.40 and the shares immediately sank below $5.00. A lot people had their fingers burnt and are not happy, are they going to line up again for another go?

TREASURER:

Well, you see the first one, the first offer of Telstra I think was at $3.40, but T2 was up towards $8.00, I cannot remember the exact price, and actually it did go up after that for a while, and then after the technology turned down it came off again. But you do have to remember that all the way through people have been taking dividends, it is not just the price and they have been franked dividends. Now, what happens when you price these things is you try and get a reasonable price, it has to be a reasonable price for the investor, and it has to be reasonable price for the tax payer. Both have got an interest here, and then you pitch it at a particular price and no-one is forced to buy Mike, you do not have to buy if you think it is (inaudible)…

CARLTON:

You might find that they are not going to. And there seems to be some confusion at the weekend between you and Nick Minchin the Finance Minister, about whether or not you park them in the Future Fund.

TREASURER:

Yeah, well Nick was asked this question as to what would happen if we did not sell and my point was it is our policy to sell, I am not going to speculate on what would happen because if you just start speculating you might confuse people. The policy is to sell.

CARLTON:

Yeah, but if you do not? Will you put the shares in the Future Fund?

TREASURER:

Well, I do not want to speculate on that because as you say all that can do is lead to confusion.

CARLTON:

Alright. Good to talk to you.

TREASURER:

Good to be with you mate. Thank you very much.

CARLTON:

Thank you. Peter Costello, the Federal Treasurer.