The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
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Wayne Swan

Deputy Prime Minister and Treasurer

3 December 2007 - 27 June 2013

30 June 2008

Interview with Charles Wooley

Across Australia

30 June 2008

SUBJECT: Community Cabinet; Cost of Living; Gippsland By-Election; Climate Change; Petrol Prices; Seniors; New Senate

WOOLEY:

First up this morning, the man in hardest job in Australia, no doubt, the Treasurer, Wayne Swan. G'day, Wayne.

TREASURER:

Good morning, Charles. How are you going?

WOOLEY:

Extremely well. You're in Mackay, aren't you?

TREASURER:

Yes, I am. We had a Community Cabinet up here yesterday afternoon. The Cabinet will meet again this morning. We had 500-odd people in a high school hall in North Mackay yesterday and people sort of aired all of their problems and talked about their ideas for the future. It was one of those meetings which is always good to do in politics. It brings you right back to earth.

WOOLEY:

It does. You're sticking your chin out a bit and asking to be hit and sometimes the blows are unexpected. What did you get yesterday?

TREASURER:

Well, a number of things which you and I have talked about a lot I guess. Housing particularly, the affordability of, the difficulty of people on low and fixed incomes to afford rent, pressures on critical infrastructure such as roads in a place such as this which is, in some ways, booming but doesn't necessarily have the critical infrastructure to maximise the opportunities for the region, so, a lot of talk about roads and so on.

WOOLLEY:

In the wake of what happened in Gippsland yesterday with a nine per cent swing against the Government, did you get any notion there that maybe the bush, or regional Australia, is a little disaffected from Canberra at the moment?

TREASURER:

I'm not sure about that. I certainly understand that regional Australia particularly feels the full force of, you know, a 16-year high inflation number that we got earlier this year which goes back through last year and the year before, and of course that's been made a lot worse by this global oil shock where petrol this year is up by 30 cents a litre, and of course if you are in a regional area that really, really carries some punch. So, I think those sorts of issues are certainly live and real and a lot of pressure on family budgets, which is why we're also spending a lot of time talking about all of the initiatives which will start tomorrow – the tax cuts, extra childcare assistance and the Education Tax Refund and so on.

WOOLEY:

We go to Gippsland, as we do to parts of Far North Queensland, same thing in Gippsland, of course, I know that area quite well. People do long commutes there, they are going to feel the fuel hike more than anyone else, I think, and that might count for some of this swing against the Government.

TREASURER:

Well certainly, but it's also an area that we've never represented. I mean, it's never voted for our side.

WOOLEY:

You wouldn't have expected to win it, but a swing against you that strong?

TREASURER:

Well, three candidates and so on, but look I accept the fact that there's a message in it, and we're always interested in listening to what people have got to say. I mean, I think people on low and fixed incomes are particularly finding this environment difficult, which is why we paid the $500 bonus which the previous government hadn't budgeted for, and that's why we've put in place the increased Utilities Allowance, which I think the second payment of which is going to arrive next week. So, those things are all important, but we understand that even after the tax cuts, the additional assistance with childcare and the Education Tax Refund that a lot of people have faced very substantial increases in their cost of living in the last few months. And that's why I'm so pleased we've found room in the Budget to actually deliver these things because, as you know, we had a lot of gratuitous advice that said we shouldn't have done so.

WOOLEY:

Brendan Nelson is taking an unusual posture, I think, on climate change, given the fact that I think we all accept that climate change is upon us and we need to change our ways otherwise they will be changed dramatically, but he's saying that he's now warning us that the emissions trading scheme will make a goods and services tax look like a walk in the park. Does this mean that the general bipartisanship about handling this global climate crisis is now over in Australia?

TREASURER:

Well, that may be the case. It's the height of economic irresponsibility from the Liberals and the Nationals on this question because, you know, their delay on climate change by four of five years has increased the cost of inaction and made it all that much more difficult.

WOOLEY:

But can you do it? Can you do the necessary job that Mick Stone and others are saying has to be done, and Garnaut, I'm sure, is saying too? Can you do it without the Opposition on side?

TREASURER:

Well, we're going to have to because it's absolutely essential to the future of this country's prosperity that we do deal with climate change, and deal with it in a rigorous way.

WOOLEY:

But a simple one, Wayne Swan, is just the fact that under an emissions trading scheme we going to have to pay more for fuel, and blind Freddy can see that, but if the opposition made a campaign against that, that is the very fundament of climate change adjustment economically, if you can't get that going, what hope?

TREASURER:

Well, first of all, we're going to put the design of the emissions trading scheme out there in our Green Paper in the middle of next month, and that will go through all those issues so it's pretty hard to have a theoretical debate about the implications for this part of the system before the other.

WOOLEY:

But fuel will go up, won't it?

TREASURER:

Well, certainly from an emissions trading scheme, I would make the point that it does push up prices in the economy, that's certainly the case, but it also raises revenue, we all know that. And what I've said, very, very clearly, is that every dollar of revenue raised will go back into additional assistance to those who are adversely affected, be they households or industry or other forms of industry assistance. So, that's a very bedrock principle from which we start.

But can I go on and say that to be economically responsible in the environment we are in, it does demand action on climate change and this Government will not shirk the very hard decisions that are involved, because it's essential to our future prosperity, but not only that, job opportunities into the future. Other countries, in one form or another, are moving on climate change as well. It is imperative that we get these settings in place because that is what will underpin our prosperity in future years, and not to act endangers that prosperity.

WOOLEY:

Tony Blair's been talking about this, the former British PM, he's saying in The Australian today in an opinion piece failure is not an option, that we face ruin if we don't do this.

TREASURER:

There is no doubt that the consequences are dire, and this country should have faced up to this problem four or five years ago when it became abundantly clear that not only was action required, the type of action that was required. We're facing up to that. It's hard. It perhaps doesn't get any harder in politics – the policy of trying to put together the policy for an emissions trading scheme. But we're up for that task, we put our hands up for it in the election campaign and we're determined to deliver on that. If the Liberals want to completely and utterly junk what remaining there is, in terms of their economic credibility, they sound like they're doing a good job of that at the moment.

WOOLEY:

But it's really easy, you've got to admit, from the difficult position of government, it's very hard to withstand sniper fire over something like petrol prices and hence, Labor's poor showing in the by-election, I would think.

TREASURER:

Well, you know, sniper fire never won the war, Charles, and, you know, we've got to marshal all of our policy expertise and we've got to go out there and argue for the case for action, and the policy case to deal with the problem. We understand that's difficult, but we're not going to shirk that responsibility like the previous government did.

WOOLEY:

My old mum won't forgive me if I don't ask you about pensioners again, Wayne. Because I've got a 91 year old mum, I know a few oldies, they're all doing it pretty tough.

TREASURER:

They certainly are.

WOOLEY:

I'm sure you would like to do something.

TREASURER:

Well, we have. The bonuses are being paid as we speak. The Utilities Allowance is out, but over and above that, we announced in the Budget that perhaps didn't get the attention it should have at the time, that we would have a fundamental review of the age pension. We couldn't undo in six months what the previous government hadn't done in 12 years. So, we are having a serious look at the adequacy of the base rate of the pension. I entered politics, Charles, principally because I wanted to stand up and do something for those people who were more vulnerable in the community, and that includes people on low and fixed incomes. So, I understand the importance of this, it goes to the very core of my political being. But we have to deal with this in a responsible, measured way and in an affordable way. And of course, the rest of the Budget was a difficult one to do because the previous government had been spending pretty recklessly. We had to rein that in, but we also had to put in place the funding for the critical infrastructure of the future which will underpin our prosperity. So, we did provide additional assistance. I recognise that pensioners, they're still doing it tough, and we will be doing more into the future.

WOOLEY:

It's been observed by many of the sardonic people in the Gallery that you started out shakily and that you're now hitting your straps, looking very confident as a Treasurer. But what's it going to be like for the Government generally in the new Senate?

TREASURER:

Oh well, you know, when the going gets tough, the tough get going and the ground rules sort of changes all the time, the ground rules change, the Senate is changing but we haven't had an easy time with the Budget up in the Senate. We've had it put under a lot of pressure, they've certainly punched a bit of a hole in our surplus, and there's going to be more work to be done when the new Senate starts. But we put our hand up for government. We approach government with passion, with an intensity and, of course, the international circumstances at the moment demand that this Government, that the Government responds at a Federal level and we're doing that. We are working hard but we're putting our hands up to tackle the hard challenges irrespective of opinion polls and by-election results. We understand getting the framework right for the long-term is the most important thing we can do.

WOOLEY:

Have you sent a message to Nick Xenophon, Family First and the Greens that if you don't get cooperation that a double dissolution could be down the track?

TREASURER:

I think it's a bit early for all that sort of stuff. I'll certainly be talking to them. I know other members of the Government will be talking to them. And I remain always hopeful that sensible propositions will pass the Senate.

WOOLEY:

Okay, Wayne Swan, thank you very much. Enjoy your day in Mackay.

TREASURER:

Good to talk to you.

WOOLEY:

Good to talk to you. Thanks for your time.