HOST:
Mr Bradbury, good morning to you.
DAVID BRADBURY:
Good morning Jon, good to be with you.
HOST:
Why bother with a surplus when pretty much everybody else thinks it is not as important as you do?
BRADBURY:
Well, I'm not sure that's the case. I think the Reserve Bank Governor certainly seemed to be indicating in his evidence to the House of Representatives Economics Committee recently that he thinks it's important. And certainly, that is a factor in our considerations. Running a tight fiscal policy ensures that the Reserve Bank, which will always take its decisions independently of government, but of course gives the Reserve Bank the room that it needs to make future cuts if that's what the economy needs at any point in time. So we think it's important, when you look…
HOST:
The economy needs to expand rather than contract. So this is a contracting measure not an expanding measure.
BRABDURY:
You're absolutely right and the economy is expanding and it's worth just reflecting upon that for one minute. The Australian economy today is 11 per cent larger than it was before the Global Financial Crisis. And that's unparalleled growth amongst major advanced economies. We are estimated, according to forecasts released by the IMF, to be leading the pack of nations when it comes to growth in this year and next year. At the same time, look at all of the other indicators that underpin the Australian economy. You've got unemployment with a five in front of it. You've got inflation contained, interest rates low, we've got a record pipeline of investments…
HOST:
We can go through those one by one but we don't need to because both of us know and everyone listening knows that that's not the whole economy, that's the mining part of the economy propping up the ailing part of the economy and things aren't as good as you're making out.
BRADBURY:
Well, I tell you what, I've observed politics for many years and I'd rather be presiding over an economy with growth, strong growth, low unemployment, contained inflation and significant investment coming into the country and the AAA credit rating that we have, which is not some abstract notion, I hear people talking about it as if it's some airy fairy thing, what that means is that the cost on our borrowings, because of the Global Financial Crisis we had to borrow money to stimulate the economy to keep people in jobs, because we have a AAA credit rating, first time Australia has had this amongst all three ratings agencies, well we pay less on the interest on our borrowings than we would if we had a worse rating than that. So all of these factors …
HOST:
You're arguing that we'd go to a worse rating just by abandoning the promise of a surplus is not necessarily as strong as you make out.
BRADBURY:
I'm not suggesting that that would be an automatic consequence.
HOST:
Nor should you.
BRADBURY:
But if you are serious about delivering on the commitments you've made, and we are, then you have to maintain tight fiscal policy and that means not just handing down a budget that's forecast to deliver a surplus, it means making sure you're keeping a very close eye an expenditure and revenues throughout the year and making adjustments as and when they might be required.
HOST:
Alright now Minister, the latest opinion poll out in the Fairfax press this morning shows that although Julia Gillard has lifted her personal approval rating, it's not translated in any way into a better primary vote for the Labor Party and you've only got one-third of the electorate intending to vote for you at the next election. That's hardly a suggestion that you're doing things right.
BRADBURY:
Well, I think on the two party preferred factor, which of course is how elections are determined in this country, we're in a much stronger position than we've been in the past.
HOST:
You're up one per cent.
BRADBURY:
We are not in the business of providing the day to day commentary on the polls.
HOST:
You would still get walloped in an election on these figures, wouldn't you?
BRADBURY:
We've got a year to go, a year to go. Let's be very clear about that.
HOST:
So are you optimistic then?
BRADBURY:
If we make the sort of progress that we've made in the last six months in the next twelve months then this will be a very tight contest.
HOST:
Do you think you're on the way back?
BRADBURY:
Look, we've always said that some of the hard decisions that we've taken, they weren't popular decisions, but they were decisions that needed to be taken in the long term interests of the economy - pricing carbon for example. Now, for all the hullabaloo that we had in the campaign that Mr Abbott led, trying to tell us that the sky would fall in, that a leg of lamb would cost you $100, all of these ridiculous claims that have been shown to have been false, the Australian people, they're not necessarily out there, and they never were going to be out there dancing in the streets in support of taking action on climate change in this way, but I think there is a growing acceptance and recognition that this has been a policy that is already having effects in terms of cutting carbon pollution and it hasn't impacted on household budgets [inaudible]
HOST:
This puts Kevin Rudd aside for now, does it not?
BRADBURY:
We resolved these matters at the start of the year. Kevin, I think, was very open with people in saying that he was going to have a crack and if he didn't get the support then he would throw his support behind the Prime Minister. I think we are also demonstrating very clearly to people that whilst we're out there fighting for hardworking people, you've got Mr Abbott and co out there continuing on with one of the most recklessly negative approaches that any opposition in this country has ever taken.
HOST:
Alright, I'm going to have to move on. Thank you for your time this morning. Assistant Treasurer, David Bradbury.