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

Wayne Swan

Deputy Prime Minister and Treasurer

3 December 2007 - 27 June 2013

15 April 2011

Doorstop

Washington

15 April 2011 (Australian time)

SUBJECTS: G20 Finance Ministers Meeting; IMF/World Bank Meetings; Trade policy; Carbon price; Electricity prices; Cost of living

TREASURER:

First of all I'll say a couple of words about what I'm doing here in Washington and then I'm happy to answer any of your questions. I did want to say a couple of things about being here for the G20 Meetings and the IMF and World Bank meetings because it really is an important opportunity to take the temperature on the global economy and get an assessment of where it's going. That's always important when you're putting a Budget together because the global economy is strengthening but it is very patchy and it's very uneven and I think it's fair to say that there is uncertainty out there and the risk is to the down side.

If you look at the instability in the Middle East and North Africa, of course if you look at what's going on in Japan, they are all factors that are creating near term uncertainty in the global economy and of course as you know Japan does have an impact upon Australia it is one of our most significant trading partners. Those things all flow through but for Australia our long-term fundamentals are strong despite the fact there is near term uncertainty.

I'm looking forward to discussions in the G20 particularly about the framework for sustained and balanced growth but also to review what's going on in terms of financial regulation, to take the views of people about how this implementation is going and what more needs to be done.

Over to you.

JOURNALIST:

Mr Swan, Paul Howes says that if one job is put at risk by the carbon tax his union support is gone. What's your response to that? And the second question is –

TREASURER:

Can I just say something about jobs because it's a very central purpose of this Government from day one, particularly in our handling of the Global Financial Crisis and the global recession was to put jobs first and to support employment in Australia and to do it in a way which was sustainable, to be ahead of the game. And the fact is that we have to go to lower carbon emissions. There's no choice and we have to make the transition to a lower carbon emissions economy. That's what the government is having a discussion with the business community about and of course with unions and the wider community.

Nothing could be more important to jobs than Australia in the future than making that transition. If we don't make that transition there will be a threat to our economy because the world is moving to lower carbon emissions. So it's a difficult transition but it's one that the Government wants to make working with the community because our number one objective is to support employment and future prosperity.

JOURNALIST:

But how will you reassure Mr Howes and other union leaders like him who are concerned about it? They're saying that their members are revolting because (inaudible) but they're mostly concerned about jobs (inaudible)

TREASURER:

This is a very significant reform and big reforms in Australia ought to be discussed. They're tough, they're tough to implement. Big reforms however, are important to making sure we have long-term prosperity. We're absolutely mindful of what we must do to support employment in the Australian economy that's why we've said that first of all every single cent raised from the carbon price will go to help households and also to support industry, particularly the energy intensive trade exposed industries. They're very important and we're engaged in consultations with those industries.

JOURNALIST:

Mr Swan, what do you expect to come out of this weekend's meetings? Anything concrete on a lot of these issues you've discussed?

TREASURER:

Well, what the Finance Ministers do is all the preparation for the Leaders meeting later in the year. One of the topics that is front and central at the moment is the framework for sustained, strong and balanced growth and as part of that framework Finance Ministers are developing guidelines which will be used to measure financial imbalances, financial imbalances in the global economy and financial imbalances in individual economies within the global economy.

We've got a bit of work to do on those indicators this weekend and I'll be happy to report to you after we've concluded our deliberations, but at the end of the day we work towards a leaders meeting at the end of the year. We don't take critical or final decisions at these meetings. We're the gofers, if you like, who get out there and do the leg work.

JOURNALIST:

But nonetheless are you expecting that China will show more willingness to, you know, (inaudible) the guidelines that you've proposed?

TREASURER:

Well, the great thing about the G20 is that it has brought together developed and developing economies. It's got the developing economies, particularly of Asia, around the table. Before, when there was a G7 or a G8, none of that happened. I'm pretty optimistic we'll work our way through all of the complex issues that form part of the framework for sustained and balanced growth. We come to that with good will and I'm sure they do as well.

JOURNALIST:

It's been reported today in Australia that Cabinet was (inaudible) the wisdom of proceeding with free trade, embracing free trade, and that you in particular were questioning the political wisdom of proceeding when the government is already fighting on other fronts.

TREASURER:

Well, I've been a very strong supporter of free trade. A strong supporter of making the DOHA round successful. I spent a large part of my time working for that outcome. I don't comment on those sorts of reports and I don't verify those sort of reports because I don't comment on Cabinet's deliberations.

JOURNALIST:

Do you fully support Craig Emerson's policy of (inaudible)

TREASURER:

I've just made it very clear, I've got a long record of supporting a trade liberalisation agenda and that is the agenda of the government. I don't think everybody should necessarily accept, just because something has been reported, that it is necessarily correct.

JOURNALIST:

So you're a supporter of unilateral trade liberalisation –

TREASURER:

I'm a strong supporter of trade liberalisation, have been for a long time and will be into the future.

JOURNALIST:

Including unilateral trade reforms?

TREASURER:

I'm not in the business of playing word games but I'm a supporter of a strong trade liberalisation.

JOURNALIST:

The independent marketing tribunal in New South Wales has put up power bills by about 18 per cent and a third is being put down to the Federal Government's renewable energy target scheme. Barry O'Farrell is saying that he'll be asking the Federal Government for compensation for it and he's asking why should householders be paying for an overly generous scheme?

TREASURER:

Well, first of all it's Mr O'Farrell's scheme. He's now the Premier of New South Wales and he's responsible for that system. The truth is, and everybody knows it, that the main pressure on power prices has come from the investment in the transmission system of the power system. That's entirely within Mr O'Farrell's control. He ought to look in his own backyard.

JOURNALIST:

Are Australian consumers facing a consumer cost crisis?

TREASURER:

Well, there has been a substantial increase in electricity prices in Australia in recent years caused principally, but not solely, by failure for there to be sufficient investment in the electricity industry and most particularly in transmission.

JOURNALIST:

More generally consumers in the political election results and opinion polling seem to indicate that consumers are getting (inaudible)?

TREASURER:

There's no doubt that people are feeling cost of living pressures and that's why the Government has been very active. We've delivered three rounds of tax cuts and that's why we've put in place the education tax refund the 50 per cent child care tax rebate and a number of additions. We recognise that many families and individuals do it tough with cost pressures out there.

JOURNALIST:

Would it be fair to describe it as a crisis?

TREASURER:

Well, there's no doubt that a lot of people are finding the electricity price increases pretty tough.