HOST
Joining us on Nights is the Assistant Treasurer and the Member for Lindsay of course in outer western Sydney, spoken to him many times before, David Bradbury, good to talk to you again.
BRADBURY
Good to be with you Steve.
HOST
We’d love the banks, the big four, to move and move quickly. It doesn’t seem to be any great deal of optimism that they will.
BRADBURY
We will certainly be looking forward to them passing on the full effect of this rate cut. Obviously they have to balance the funding costs that are attached to the funds that they provide. But we have always said there are a couple of important points to make here and the first one is that if you have a look at the profitability of our banks, they are doing well. That’s a good thing, we are pleased to see that but it is important to note that they are very profitable. Second point that we make is that in recent pronouncements from the Reserve Bank, indeed in some of the Reserve Bank’s recent statements, they have made the very insightful observation that funding costs for our banks have started to decline throughout the course of this year. So against the backdrop of those two considerations that we would be arguing that the banks should be passing on the full extent of this cut, but obviously in the end Governments can’t regulate prices in these things, but what we have always said is that customers, consumers they always have the option and should be willing to use the market power that they have if they are not happy with the deal they’re getting with their bank, pack up their business and go down the street and find someone that offers them a better deal. As a Government we have been putting in various measurers that make it that little bit easier for people to do that.
HOST
As Assistant Treasurer what do you read into the Reserve’s decision to go for a half a point cut? What’s it say about what they’re thinking about how the economy’s travelling?
BRADBURY
Well, the Reserve Bank’s statement certainly identifies that there are some patches of softness throughout the economy, but let’s be honest with ourselves, Steve, they are not telling us anything there that we didn’t already know. We have been saying for some time, this has been very central to our economic case. It has been that the two speed economy, the patch work nature of growth with the resources boom that has been going gang busters, at the same time there are other sectors of the economy not really travelling in that fast lane, and that has been the very basis upon which we sought to introduce the Minerals Resource Rent Tax which is a pivotal policy of ours that really seeks to spread the benefits of the mining boom. Of course we are delivering some of those benefits. But importantly the cut to the company tax rate which is something that we are very patient about is being blocked in the Parliament; circumstances there when you have a Liberal Party who hold themselves out as being the Party of business, but when it comes to business tax cuts they have been blocking these measures in the Parliament, now obviously, and I saw Mr Hockey out today making some, what I thought were very pessimistic comments about the economy, talking the economy down. If he is concerned about strength and growth in the economy, the first and most important thing he can do when Parliament resumes is walk into the Parliament and along with his colleagues support the cut to business tax. In the end that will ensure that businesses right around the country, not just those in the fast lane, have the opportunity to continue to grow, to prosper and hopefully to do what they do best and that is employ lots of Australians.
HOST
It’s difficult if you live in a major capital like Sydney and Melbourne to not be a little pessimistic about the economy though isn’t it, I mean you are the Member for a seat in far western Sydney which must be feeling that two speed economy pain. I mean, the people that put you in to the Parliament are probably coming up to you in the street, are they not? And saying David, it is tough here.
BRADBURY
Look, I think that there is always an option open to people as to when they look at the glass they see it as being half empty or half full. Now there is no doubt that there are plenty of people who are facing challenges in balancing their household budgets, there are many business working hard to stay afloat and to some extent that is always a challenge that many businesses and many families face. But when you have a look around the world, it’s not easy or plain sailing anywhere at the moment, but what you can say is when you look at the Australian economy we have so many things going for us, we have got to try and put this in some international context. I know that is not always something that is in your forward front of your thinking when you are trying to balance your family budget or make sure your small business sits afloat. But the world has been through some challenging and turbulent economic times, the Global Financial Crisis. Many people around the world don’t talk about it like it is a historical event because they are still living through it, but here in Australia we were fortunate, fortunate as a result of the work of many I think to get through without falling into a recession. But obviously there has been a pretty big correction going on right across the global economy, we are feeling some of that but to be honest in terms of the overall indicators, overall position of our economy we have a lot going for us: low unemployment, inflation being contained, our growth is returning to trend. As an economy we have been growing more than any of our counterparts in the advanced world. And on top of that we have a record pipeline of investment flowing into this country of the sort that we have not seen before, so I really think that when we look at the glass, sure it is not full but it is not empty either.
HOST
Must be very difficult though for you I mean, I am talking to David Bradbury, to be optimistic, given the events of this week and last week, got a new poll out today that shows your new record levels of support. You were a major supporter of Julia Gillard’s during the last challenge with Kevin Rudd - did you back the right horse?
BRADBURY
Well look, I think the Prime Minister is doing a good job in very difficult circumstances.
HOST
How can you say that?
BRADBURY
Well, look because the Government, we are implementing reforms that will stand the test of time. Are they popular? Well clearly they’re not. But when you look at the nature of the task and the challenge that confronts this country, if we are truly optimistic about the opportunities that we can take advantage of in the future, then these are the sorts of decisions, the decisions that we are taking as a Government today, taking the decisions that our country and economy needs. [INAUDIBLE] for many years the Europeans are now paying a very heavy price for. Because popularity sometimes disguises people taking the decisions that the country and economy need.
HOST
There is not much point being brave if you get voted out of office, is it?
BRADBURY
In the end, people accuse politicians of only ever doing thing because they want their vote, the other side of the coin is when you seem to be doing something that isn’t particularly popular then people say, well you know, what are you doing, you are heading for a collision course here. The reality is that every single one of us is in this job to do what we think is best for the country, at the moment my focus is very much on working with the Treasurer and members of the economic team to return our Budget to surplus, I can tell you if that’s something we are able to deliver and we are working hard towards that, then that is a contribution to the country that I am very keen to play a part in.
HOST
I know you are a conviction politician, but if you are in a Government that is by all accounts when you look at those polls, about to be voted out do you not sometimes go home and say look, we’ve got to change things, it’s not working the way we are doing it, does the Prime Minister continue to have your support?
BRADBURY
Yes, yes she does but look -
HOST
And will she until the end? I mean, are you going to keep -
BRADBURY
Well she does and there is no question about that.
HOST
You wouldn’t swap under any circumstances?
BRADBURY
Can I make this point that anyone in politics that says they are not willing to consider change in approach and in policy, I think that is not a reasonable position for people to take either. Having said that we have set and charted a very clear course on a number of the broad policy objectives that we are seeking to implement, sometimes along the way you need a slight change of approach, sometimes a very big change of approach. When it comes to the question of leadership you know there is no question there in terms of where my support rests, but clearly we have got to get out there.
HOST
So there is no mood again for change, it seems incredible that I am even asking the question, given it only happened a few weeks ago, but there is no mood again for change?
BRADBURY
No look, I think this matter has been resolved it was resolved decisively.
HOST
And no one is talking about it again?
BRADBURY
Well do we face challenges, yes, clearly evidently we do but I am very much focused on making sure we hand down the Budget next week that does return us to surplus, that will be an achievement in its own right, if you get your policy right I think we can do more on the communication front. But we do have to lift our game but we will continue to work hard and for me I will give it every bit of energy I’ve got.
HOST
Well, you always make yourself available, which I appreciate. David Bradbury thanks a lot.
BRADBURY
Great to talk to you, thanks Steve