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 06/11/2007

Doorstop Interview
Noarlunga Hospital, SA

Tuesday, 6 November 2007

11.00 am

SUBJECTS: Noarlunga Hospital, McLaren Vale and Districts War Memorial Hospital, Kym Richardson, polls, international economic instability, interest rates, land audit, housing

TREASURER:

Well I am here today at the Noarlunga hospital with Kym Richardson to make two announcements. The first is that a Coalition Government, if re-elected, will provide $1.8 million to the Noarlunga Hospital for a 10 bed high-dependency unit. I have just had the opportunity to walk around the hospital and to see the hospital which is truly very impressive and I congratulate the staff of the administration for the work that they have done in establishing this hospital and the Commonwealth Government will make available $1.8 million for an additional 10 bed high-dependency unit. And that will add to the capacity that the hospital has to treat local people, it will mean that they will be able to treat them here rather than send them to the Flinders Medical Centre - nothing against the Flinders Medical Centre, it is a wonderful hospital, but if they are able to treat some more people here in the local community I think that will be a wonderful thing.

The second announcement that I am making today is in relation to the McLaren Vale and Districts War Memorial Hospital: a re-elected Coalition Government will provide $1 million for a fit-out at that hospital for a community health clinic. Now, a community health clinic has already been established at the hospital but this $1 million will go to construct facilities for the community health clinic to operate. And that takes some of the pressure off the hospital if you have doctors that can medically treat matters which otherwise would have to be dealt with in the hospital itself. That community health clinic will also be eligible under the new announcement that we have made in this campaign for family emergency centres, if that health clinic wants to go 24 hours it will be eligible for additional funding to keep a 24 hour service going for emergency cases which can be treated at the medical level - things like fractures or broken bones can be treated by the doctors rather than require in-patient admission or indeed the hospital services at the accident and emergency.

Both of these announcements are being made because they have been brought to the attention of the Coalition Government by Kym Richardson, the Member for Kingston, who has been working with the hospitals and working with the Government for some time for this announcement and I pay tribute to the work that he has done in relation to this. And he might have to say a few words on the hospitals before I take questions.

KYM RICHARDSON:

Thank you Treasurer. As the Treasurer has just stated this will actually provide a further saving of something like $750,000, rather than having to transfer patients from this hospital to the Flinders Hospital even for just acute chest pains that the high-dependency ward now will be able to provide that as an on-going connection with the people of the southern area which is fastly expanding and the McLaren Vale Hospital initiative is one which has been very, very needed for quite a long period of time and I am very happy that the Treasurer Peter Costello has come down and announced it for our Southern area. Thank you.

JOURNALIST:

Mr Costello, the polls are showing the Government clawing another point back - any comment?

TREASURER:

The polls are going to move around a lot over the course of this campaign, I said at the outset that I would not give a daily commentary on them and I won't. I think that this is very much an open election, either side of politics could win this election, from my point of view, as people think about the choice that they are going to make I would say to them that it is going to be important to have people who know what they are doing managing thetrillion dollarAustralian economy. There are a lot of risks around at the moment - we saw overnight again on Wall Street, probably the largest financial institution in the world Citigroup, which has announced $8-11 billion of new losses in the US sub-prime market. There is a lot of uncertainty in relation to oil prices, now at all-time world record highs, that the task of economic management is going to become more difficult in the years that lie ahead and peoples jobs and mortgages and their businesses are going to depend on that economic management and the Coalition represents experienced management. We have steered Australia through crises before - the Asian financial crisis, the US recession - and we can steer Australia through crises in the future.

JOURNALIST:

Do you think there is any chance that the Reserve Bank won't lift interest rates today?

TREASURER:

Well I don't comment on decisions of the Reserve Bank...

JOURNALIST:

(inaudible)

TREASURER:

...I haven't done so over the last 11 years and I won't start now. But, I would say the important thing is to have experienced management at a time when risks are appearing all through the Australian economy and the Coalition Government, John Howard and myself, have steered Australia through economic risks in the past, we can do it again.

JOURNALIST:

Whatever the outcome of the election, the constant indication seem to be that this seat, along with he other Liberal held marginals Makin and Wakefield, are as good as gone - is that reflected by the fairly modest amount of spending you are announcing in this seat?

TREASURER:

Idon't accept that for a moment.Kym Richardson is an extremely good candidate who has made a great contribution in the Federal Parliament and the fact that I am here today indicates just how important this seat is and how much we are committed to it.

JOURNALIST:

Is the Prime Minister coming back to Adelaide again during the election?

TREASURER:

I would think so, yes.

JOURNALIST:

If Labor...

TREASURER:

I can't tell you when because we don't want to alert the demonstrators.

JOURNALIST:

If Labor was responsible for interest rate rises when they were in Government how come your Government is not responsible now?

TREASURER:

Well during the period that I’ve been Treasurer there have been 19 cuts, the equivalent of 25 basis points and 15 rises. And that’s during a period when the Australian economy has grown in its longest period of expansion, and unemployment has fallen to 33 year lows. Let me make this point, interest rates today are lower than they were when we took office in 1996, notwithstanding the fact that we’ve had 2.2 million more jobs created. In fact, home mortgage interest rates are lower today than at any period under the Labor Party, including the depths of recession. The fact that home mortgage interest rates can be lower today, after the longest period of expansion and near full employment, than they were in the depths of recession indicates how far we’ve come in Australia.

JOURNALIST:

So Treasurer, you’re not…

TREASURER:

Let me make this point, you know, you would normally have very, very low interest rates in a recession because you would be trying to stimulate the economy. The fact that interest rates are lower, home mortgage interest rates are lower today than they were in the depths of a recession indicates how far we have come in Australia.

JOURNALIST:

Treasurer, your argument then is that ultimately governments are responsible for interest rates even though they are set independently by the Reserve Bank.

TREASURER:

Governments have to play their part. When I became Treasurer, the budget was $10 billion in deficit. The Commonwealth hat $96 billion worth of debt. The first thing we did is we balanced the Budget. That has been a big part of the economic success of Australia. Now of course budgets weren’t balanced before we were elected. They weren’t balanced under the Labor Party. Kevin Rudd didn’t support the balancing of the budget. He didn’t support the repayment of debt. In fact, I don’t think he supported any policy that’s actually taken some decisiveness to implement and he certainly wouldn’t have any policy or economic management in the future.

JOURNALIST:

So if you’re taking credit for low interest rates under the life of the Government, then ultimately if they are risen today, that is also going to be a reflection of the Government’s economic management.

TREASURER:

The home mortgage interest rate today is lower than at any period under the Labor Party, including when Australia was in the depths of the worst recession in 60 years and unemployment was at 10 per cent. The fact that you can have lower interest rates even though we are at near full employment with unemployment at 4.2 per cent indicates how far we’ve come.

JOURNALIST:

Mr Costello, when are you going to release the details of your land audit and will you make funding, will you make the release of Commonwealth land conditional with the States also releasing land?

TREASURER:

Well, the Commonwealth has identified all of its holdings of land and is now working through those parcels of land that could be released for housing. Obviously, not all can be. You know, some are military barracks. Some are important public spaces. So you have got to work through those that are suitable for release and those that aren’t and Senator Minchin is doing that and I am sure he will have something further to say about it. We would also like state governments to cooperate. Some have, some won’t cooperate. Some Labor State Governments will not cooperate with land release. It’s regrettable and if Kevin Rudd wanted to do something useful, he could tell his Labor colleagues to cooperate with the Commonwealth in relation to land release. And then the third category is private land. There is quite a lot of private land that could be released if zoning restrictions would allow it, if the tax regime was less onerous. We are also working with state governments to ask them to release some of that land and to reduce some of the taxes that are inhibiting the release of that land.

JOURNALIST:

But will it be a carrot and stick approach? You don’t release land unless they release land?

TREASURER:

Oh no, the Commonwealth will play its part and that land that we can release, we will. And we would ask the state governments to do the same.

JOURNALIST:

Kevin Rudd has also announced a superannuation-style savings account for people to buy their first home. Do you think this is a good idea or do you think it might push up house prices in the future?

TREASURER:

Well, for low income earners it does nothing. It really does absolutely nothing for low income earners and I am really surprised that Labor had done so little work that they came up with a scheme which does nothing for low income earners.

JOURNALIST:

Why wouldn’t it help low income earners?

TREASURER:

Because it has a tax rate of 15 per cent. This is the beneficial tax rate of 15 per cent which low income earners are on. Our plan in fact is to have, if you recall, 45 per cent of Australians on a 15 per cent tax rate at least, so for 45 per cent of Australians, it will do nothing. What it is offering on a savings account is a 15 per cent tax rate. If you are on a 15 per cent tax rate that is not a beneficial change. You are still being taxed at your full marginal rate. And with the plan that we have to have 45 per cent of Australians on 15 per cent tax rate, offering a 15 per cent rate on a savings vehicle would offer them nothing. For 45 per cent of Australians, in fact the 45 per cent of Australians who are the lower income earners. And it is really surprising there is a gaping hole. That is, why I don’t think there has been much scrutiny done on it because those people who know these things know that there is a gaping hole and the people that are not helped at all are the lower income earners who you would think would be the people you are trying to help. Last question.

JOURNALIST:

Off to Flemington today?

TREASURER:

No, unfortunately I am not. I am working today.

JOURNALIST:

Are you going to make any bets?

TREASURER:

Well, I took a tip from Betty around there, number 7 she told me, so I am going to go and have a look at it now. Thanks very much.