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

13 July 2011

Interview with Sabra Lane

ABC Radio, The World Today

13 July 2011

SUBJECTS: Consumer confidence; Tony Abbott talking down the Australian economy; ACCC funding to deal with false claims relating to the carbon price; Clean Energy Future reforms.

LANE:

Deputy Prime Minister welcome to The World Today.

TREASURER:

Good to be with you.

LANE:

The Westpac-Melbourne Institute Consumer Confidence Survey fell 8.3 per cent in July.  That's one of the biggest falls since the global financial crisis and the recession of the early 90s and one of the reasons, economists say, is this lack of confidence because of your carbon tax?

TREASURER:

Well, I think there are a variety of factors involved in the figures today and of course the figures today were taken before the release of the clean energy package, but I think there's a number of factors here.  We've seen significant uncertainty about events in Greece and other parts of Europe, as well as some sombre data that's come out of the United States.  So that's certainly a factor and of course we do have cautious consumers.

But there's no doubt that Mr Abbott has been running this outrageous scare campaign and there's certainly no doubt that it is having some impact. Of course that scare campaign was blown away yesterday with the news of a huge takeover bid for an Australian coal company.  So I think for the sake of Australian business, both small and large, Mr Abbott needs to stop talking down the Australian economy and stop scaring Australian consumers.

LANE:

Well, economist Bill Evans says it's because consumers are very uncertain about your tax and even the biggest fall in confidence was amongst the highest income earners, those who'll receive no compensation under your package?

TREASURER:

Well, this survey was actually taken before the publication of the clean energy package but there's also a variety of other factors, as I've said before.  We're certainly not immune from global events and of course events in Europe do play into Australian confidence patterns.

But I think there is a factor here where the Opposition has been talking down the Australian economy and they've been doing it for months, and of course they're out there now exaggerating the price impacts of the clean energy package.  Of course the price impacts are going to be very small yet day after day we have Mr Abbott making all sorts of outrageous and unfounded claims about the price impacts.

LANE:

You've announced more money for the ACCC to be carbon cops and crack down on businesses using the tax as an excuse to price gouge.  Who can refer claims on and have claims been referred already?

TREASURER:

Well, there's 22 million consumers out there that can call into the ACCC on 1300 302 502.  They can call in if they've got concerns now about claims being made.  We had one raised in the Parliament last week, which was found to be baseless.  So consumers can call in to the ACCC now, but we made it very clear today that there will be substantial additional resources to the ACCC.  It will be the cop on the beat, and it's got some pretty sharp teeth.

LANE:

Will the first cab off the rank for investigation be Qantas?  It announced earlier this week it will pass on the full cost of up to $150 million to passengers by charging and extra $3.50 per single flight ticket.  Will that be referred to the ACCC?

TREASURER:

Certainly the ACCC as the power independently to look at those pricing arrangements from a range of businesses.  It's got that power.  It's got all the power it needs to investigate the pricing arrangements and claims made about the impact of carbon pricing.

LANE:

Well, do you think Qantas' claim should be referred?

TREASURER:

Well, these are matters which are matters for the ACCC and I'm sure they'll take a very close interest in all the claims that are made about the impact of carbon pricing.

LANE:

You're the Treasurer overseeing all of this, surely you have a view?

TREASURER:

Well, I do have a view and the ACCC has the power and they are independent to investigate any claims that are made about the impact of pricing carbon, be it in the airline industry or anywhere else.

LANE:

Back in 2000 when the Howard government introduced similar measures before the start of the GST, Julia Gillard said in Parliament that voters were being asked to believe in an Orwellian truth, that the ACCC and the then chief, Alan Fells, would be lurking in every supermarket aisle and that every Australian knows there'll be no way in the world that bureaucracy can be in every store.  And she said back then there is no effective mechanism to stop price exploitation.  Can't the same be said of your scheme?

TREASURER:

I can tell you there's a huge difference between now and then, and that huge difference is the new Australian consumer laws which started on the 1st of January this year.  They are very substantial.  They cover all states and we have 22 million consumers who can contact the ACCC which has new powers to go out there and get stuck into the claims of unfair pricing.

I think we are in a substantially different environment.  And can I make just one other point about the difference between now and when the GST came in; the price impacts here are very moderate, 0.7 per cent.  They were much, much larger with the GST.  The problem we have at the moment is that people like Mr Abbott are running around the country exaggerating those price impacts, trying to scare the pants off consumers.

LANE:

How many new government agencies will be created through this new tax and how many new public servants will that mean?

TREASURER:

Well, certainly there's going to be about 20 more people working in the ACCC, and I think people would welcome that.  Given this change it does require additional resources.  There are one or two other bodies being set up under these arrangements.  We've got a Climate Change Authority.  We've got a Clean Energy Finance Corporation. We'll account for the additional staff members in those areas in the usual way as we go about setting them up.

LANE:

Have you got an approximate idea as to how many?

TREASURER:

I couldn't give you a final figure at the moment, but we've accounted for both the revenue and the expenditure in establishing these bodies and I'm happy to be accountable for that as we go through and establish them.

LANE:

Yesterday Queensland Premier, Anna Bligh, said she'd written to the Commonwealth seeking talks to discuss compensation for the massive write-down in her state owned coal-fired generators.  Queensland claims $1.7 billion will be wiped off.  Will you give them any compensation for that?

TREASURER:

Well, we're having a discussion with Queensland and a number of other states, indeed Treasury officials have been up there talking to Queensland officials. Those discussions are ongoing and we will continue to have them.  As for a final figure, it would be far too early to put a final figure on that claim and on the Commonwealth assessment of it.

LANE:

Will you be giving them money?

TREASURER:

Well, what I've said is we've produced a clean energy package, we accounted for the financing of that in the package that we announced last Sunday, but we're happy to continue to talk to the states about all of these arrangements.

LANE:

A voter bailed up the Prime Minister this morning saying that Ms Gillard lied and that she couldn't listen to Ms Gillard until she started telling the truth.  Mr Swan isn't that your problem, that most voters won't engage in what you're telling them now because they're miffed that you broke a promise?

TREASURER:

Well, I don't accept any of those characterisations.  Julia Gillard is a leader of extraordinary courage and extraordinary commitment and of course as a country we've been discussing the price of carbon for a long, long, time.  She's got the guts to get out there and put forward a proposal like this which will enhance our economic prosperity into the future and reduce carbon pollution.  On the way through that you lose a bit of paint.

This is a very big and tough reform, essential for the long term prosperity of the country, and we're going to get in there and get stuck in, put it in place.  Of course when it's in place all of these scare campaigns from Mr Abbott and all the other chicken littles around the place will be proven to be hollow.

LANE:

Mr Swan thanks for joining The World Today.

TREASURER:

Thank you.