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 26/09/06

Interview with Carol Duncan
ABC Newcastle

Tuesday, 26 September 2006

9.15 am

SUBJECTS: F/A-18 Hornet flight, financial literacy for youth, Superannuation, Telstra

DUNCAN:

Good morning Treasurer.

TREASURER:

Good morning Carol, good to be with you.

DUNCAN:

We are all busting to know how you went yesterday with your flight in the F/A-18 Hornet.

TREASURER:

Well it was a great experience.  It was one I will never forget, I can assure you of that.

DUNCAN:

Now come on, tell the truth.  I know that the team sent you up with two bags. 

TREASURER:

I went up with two bags and you will be pleased to know they both came back empty.

DUNCAN:

Well, is it true though that you hit the buffet before you went for your flight?

TREASURER:

Yes, I thought it was important to have a full stomach but these guys, these pilots are the most skilled people imaginable and the way in which they fly these machines and at the same time have radar interception and weapons distance and it is literally a blast.

DUNCAN:

Treasurer, I know you that you were up for about an hour, how far did they take you?

TREASURER:

Several hundred miles.  We went several hundred miles out to a zone where we did a mock attack and a dog fight.  So it was, you will be pleased to know, it was quite a way away from Newcastle so that the sound didn’t interfere with things. 

DUNCAN:

No I am just glad I wasn’t paying the fuel bill for that one.  Now yesterday you were at the opening of a new plant nursery and you are in Maitland today with 600 very keen school kids to have a chat about the Lifeskills programme. 

TREASURER:

That is right, it is a programme that I am going out to look at which promotes financial literacy and the Government has been trying to promote financial literacy so that kids know about money, know about savings, know about investment.  And the schools have got together and they have got a really interesting programme with their own currency called the “mutual” and kids can earn mutuals by doing environmentally friendly things and then they can trade and they can construct housing and the like and this is all promoting financial literacy.  So I am going out to get some tips from these kids today.

DUNCAN:

Oh I was going to suggest that the more you teach them about financial literacy the tougher the questions that will be for you in the future.

TREASURER:

I think that is right.  I often find that the questions I get asked at schools are tougher than the Canberra Press Gallery.

DUNCAN:

Now that is saying something.  Now I believe that the kids are actually going to try to raise the fund with their mutuals, their pretend dollars, to put solar panels on cubby houses. 

TREASURER:

Yes, by doing very environmentally friendly things they first earn mutuals and then they can invest them and they invest them in housing and in environmental projects.  And the whole idea is to learn how to save, to learn to invest.  These are important life skills that they will need for the rest of their lives.  

DUNCAN:

What are the sorts of problems that you see with around say, friends of your own children for example or within the community, of children becoming adults who don’t have financial literacy?  What are the sorts of things that they need to grow up understanding?

TREASURER:

Well the first thing people need to understand is you can’t live the whole of your life on credit, that whilst you can get credit you have to eventually pay it back and you have to service it and it is important to have a savings base.  The second thing is I would like younger people to learn about superannuation.  Many of them who have part-time jobs will have superannuation accounts but they don’t take a great interest in it and they don’t know what it is about and I would like them to learn about putting money into superannuation, to build savings over the course of their lifetime.  And if they can learn about saving and investment, I think we all learn about spending pretty easily…

DUNCAN:

I guess, (inaudible) it’s well illustrated by the fact that Australian super funds have millions of dollars lying in them that people have forgotten about. 

TREASURER:

That is right.  We have a situation where you might have a part-time job, nine per cent of your salary goes into a superannuation account.  People don’t take an interest in it.  They move home.  They move jobs and never notify the superannuation fund that we have you know, millions, probably hundreds of millions of dollars left in superannuation accounts, which no one is claiming. 

DUNCAN:

When you were a little tacker, were you a good saver, did you have your little school pass book that you eagerly got your stamps in?

TREASURER:

Oh yes, when we were young we would go off to school with a money box, I don’t suppose kids have money boxes anymore, but…

DUNCAN:

Mine do.

TREASURER:

…do yours have money boxes?

DUNCAN:

They do and they hit me up for coins to put in it. 

TREASURER:

Oh, well that is good.  I thought the money box had gone out of fashion.  I am pleased to hear it is back. 

DUNCAN:

Yes, they make a great noise at 3 o’clock in the morning.  Treasurer, we hope that you have a fantastic visit to the Hunter and we would love to see you back in our region again soon.  But I would be silly if I didn’t ask you the question of the day which is that some of the Liberal backbenchers are calling for the sacking of Telstra boss, Sol Trujillo.  What are you thoughts on that?

TREASURER:

Well Mr Trujillo is appointed by the Board so the Government doesn’t appoint him, the Board does.  And the Board is appointed by the shareholders and I think that when the shareholders meet that they are likely to support Mr Cousins.  I think Mr Cousins would be a good director and I don’t really think it is up to Sol Trujillo to decide who should go on the Board, I think it is up to the shareholders to decide who will go on the Board and once the Board is fixed it is up to the Board to decide on the chief executive.  Whilst they have got confidence in Mr Trujillo, so have I. 

DUNCAN:

Do you think that there has been any damage to the Telstra brand by T2 and perhaps what appears to people who maybe, to customers of T3, this simmering feud?

TREASURER:

Well I hope it is not a simmering feud.  The reality is that the shareholders will decide the board members and that is the way it should work, that is the way it will work.  So I don’t think there is much point in going around it in any different way.  This will be decided by the shareholders and I think it will be decided quite quickly. 

DUNCAN:

Yes, alright, hopefully it will be.  Treasurer thank you so much for your time, have a splendid rest of your visit and we look forward to seeing free piggy banks in all schools.

TREASURER:

Thanks very much Carol, great to be with you.