KIERAN GILBERT
With me on the program to discuss these issues from Melbourne the Shadow Minister for Small Business Bruce Billson and here in the studio, the Assistant Treasurer David Bradbury, good morning to you both. Bruce first to you, the story out of the West Australian that Alby Schultz would look to defy Tony Abbott's plan which essentially defers the scrapping of the industry body, what do you make of it, it'll certainly put pressure on the WA Liberals, won't it?
BRUCE BILLSON
Well it's interesting I haven't seen those reports Kieran but going by the account you've provided it seems to be a matter of timing is the issue at hand. The Coalition is very supportive of deregulating the wheat market, that is a clear policy objective. The issue is, is the industry ready? With a code of conduct, dealing with access to infrastructure and some supply chain issues to make sure all stakeholders' interests are well reflected in whatever deregulated arrangements emerge. That's the debate, the Coalition is very committed to deregulation but it's the transition arrangements that have been occupying our mind as we've worked with stakeholders who map out a policy agenda on this important issue.
GILBERT
In WA there are some real tensions on this issue and Alby Schultz intervention is only going to exacerbate that. I know that Julie Bishop the most senior Liberal in WA has done her best to cool this down a bit but certainly Alby Schultz's suggestion that he'll abstain from any vote, that's not going to help things is it?
BILLSON
Well I'll have to hear what Alby has to say and hear his point of view. There's been quite a wide range of consultation not only with Coalition MPs and stakeholders but more broadly with the industry. The situation is quite different in the way that the wheat industry has evolved on the east coast compared to the west coast, who handles, I mean who manages the handling infrastructure, people's confidence in being able to get ready access to them. That's where a code of access to the infrastructure is important, and then the transition arrangements are very important too so that supply chain pressures and people being able to function effectively and competitively in a deregulated market, they're the policy considerations we've been carefully evaluating and considering and that's why we think it's a matter of timing and how well transition arrangements are put in place.
GILBERT
David the Liberals are also saying there was a cross party House committee report from earlier this year which actually recommends a phased approach like Bruce is advocating this morning. Why doesn't the government do this, is this just about trying to embarrass the Coalition with some division?
DAVID BRADBURY
Well if that's what the Coalition believes they should go and convince Alby Schultz to begin with that that is the argument they want to put but let's be very clear about this. This is further evidence of divisions within the opposition, within the Liberal Party and the Coalition and once again we see the National Party tail wagging the Liberal Party dog when it comes to economic policy. We've seen that in all too familiar terms recently with the interventions of Barnaby Joyce in relation to foreign investment, and what have we seen since then? We've actually seen former Prime Minister John Howard come out, watching from the sidelines there with his loudspeaker yelling out to Tony Abbott, saying don't go down the path Barnaby Joyce wants you to go down on foreign investment, take a more sensible approach. John Howard once said who do you trust? Well I'll tell you, if you've got to choose on the question of who do you trust on economic policy between Barnaby Joyce and John Howard, then I'd take John Howard every time. Unfortunately, Tony Abbott and the Liberal Party today, their economic policy is being driven by the National Party and that's a danger to the national economy.
GILBERT
Somebody else has made some comments about economic policy over the last 24 hours. David Murray, the former head of the Future Fund, the former head of the Commonwealth Bank, Chief Executive of the CBA as well says Australia could head towards a European style debt crisis unless there is reform of the welfare bill in this country. Let's play you a bit of what he told the ABC last night.
AUDIO PLAYS
And Bruce Billson, David Murray is also saying it's not just this government, but the Howard Government as well that has allowed the welfare bill, the entitlement bill, which he says is being funded by offshore entities, that that's been allowed to grow under the Coalition as well during the Howard/Costello years.
BILLSON
The point he was making was the total income tax take in the Australian economy is roughly equivalent to the welfare expenditure. That was the point in the link he was making with welfare but his broader point was at a time when the government boasts about an economy growing at near trend rates where we've supposedly come through this fantastically fortuitous period of herculean resource pricing and a wonderful mining boom that as a nation we still can't pay our bills and that this Gillard Government and its predecessors have been borrowing $100 million a day, every day, and have racked up the four largest budget deficits in our nation's history. The point he was making is that...
GILBERT
Bruce he was critical of the Coalition as well if I can interject and just tell you, he said the surpluses weren't big enough, didn't he say that?
BILLSON
He did say the surpluses weren't big enough and that's not something he'd say about the current Gillard Government, they've not come within a bull's roar of a surplus, he was actually saying it would've been nicer if the Howard Government had bigger surpluses. What the Howard Government chose to do was to run surpluses, the largest surpluses in our nation's history, leave our national accounts in a situation of a net asset, cash in the bank of $70 billion position where we've now got a net debt position of $147 billion and be able to return some of the additional revenue that was beyond what was needed to put into longer term planning arrangements such as the future fund, the education endowment, funding for health infrastructure and running a surplus then with the additional revenue above and beyond those clear and sound and responsible financial planning policy objectives to be able to return some of that money to hardworking Australians. That was the Howard Government approach and you'd be certain these are challenges the Gillard Government will never face because it's $45 billion down at the moment.
GILBERT
Let's go to the Assistant Treasurer on this, your response? Because the warning from David Murray is quite concerning, that unless policy makers look at this and look at the structure of the budget and end some of these structural deficits within the budget, essentially the money going out as opposed to the money coming in then we could head down the path of some of these European disasters.
BRADBURY
Well when I heard this comparison, the suggestion that the Australian economy could face some of the challenges that the Greek economy faces, I think that was a bit like telling Black Caviar that if he didn't watch out he'd be giving kids pony rides at the St Marys Spring Festival. Let's put this in some perspective, let's look at the facts of the Australian economy at the moment. We've got solid growth, we have outperformed just about every other competitor economy in the world, and compare us with Greece, Greece has been contracting for the last six years. The Australian economy has had 21 years of ongoing growth, an important fact to remember. Let's have a look at unemployment, unemployment in Australia is 5%, in Greece it's about 25%. Have a look at the debt question, in Australia net government debt is going to peak at around 10% of GDP. Countries in Europe are facing net debt positions of more than 100% of GDP. Let's be a little bit realistic about the sorts of comparisons that we're making. Of course as an economy we need to make sure that the tax collections we are in receipt of are in proportion with the expenditure commitments that we're making. But to make these sorts of comparisons frankly is just reckless, it's irresponsible. This is the sort of thing you hear if you listen to Alan Jones on 2GB that the Australian economy is facing...
GILBERT
This is somebody who is very well respected, isn't he, former head of the Commonwealth Bank, a former head of the Future Fund, it's not like it's a shock jock making these comments.
BRADBURY
Well I think they're irresponsible comments and I would defy Mr Murray...
GILBERT
But look at his record it's not like he has a record of inflammatory comments.
BRADBURY
No hang on, well lots of people have records but it doesn't mean that they always make sensible comments. The thing I would say to Mr Murray is, I'd defy him to show me which are the indicators, which are the economic benchmarks against which he's making a comparison between the Australian economy and the Greek economy because on all of the indicators we are streets ahead of the Greek economy. Of course if you want to stay at the top of your game, you've got to work hard at it. That is why ongoing reform is important for the Australian economy. But this suggestion that somehow it is valid criticism, to somehow come forward and talk down the Australian economy by suggesting we're in danger of facing the same sort of difficulty that the Greek economy has faced, is just ridiculous. It's a ridiculous comparison.
GILBERT
I'll go back to Bruce in a moment for his response but you've seen at the bottom of our screen the former HSU National President Michael Williamson has reportedly arrived at a Sydney police station he is expected to be charged during the day for his involvement in the HSU scandal, the reports that we're receiving suggest that Mr Williamson walked in with another person presumed to be his lawyer, it's the first time he's been seen since July when he quit as National President of the union by text message, a police spokesmen said he could not confirm if Mr Williamson will be charged today, but as I say there are reports along those lines to suggest that detectives are anticipating to charge him with a number of offenses relating to hindering investigations. We'll have more on that breaking news throughout the morning as it develops. Bruce Billson to David Bradbury's response to David Murray, what do you make of that in the sense that you look at the broader economic environment, international environment, Australia remains, despite the criticisms of the Coalition, remains comparatively one of the strongest in the developed world, if not the strongest.
BILLSON
Well I'm not sure you could characterise David's answer as a response it would seem to be Labor political tactic 101 to go on to attack anybody who raises concern about the direction that this government is taking the nation and the national economy. For those that had bothered to look at the interview last night, it was actually the interviewer that posed the question to David Murray about what would it take to see the Australian economy on a pathway similar to Greece. That's what the question was, what Mr Murray was pointing out, a highly respected banker and business person whose advice is valued right across the political spectrum, that the current trajectory that the government has the economy on is unsustainable. It is spending, and I can't even say spending like a drunken sailor because a drunken sailor only spends his own money. This government is not only spending the money coming in, they're borrowing $100 million a day and the issue is...
GILBERT
Okay but the...
BILLSON
You gave David a pretty good run there Kieran...
GILBERT
Yeah and you had a pretty good run before it so I don't need instructions on how to run the show, Bruce...
BILLSON
Always happy to help though, always happy to help.
GILBERT
In terms of the structural balance of the budget we know that during the Howard years middle class welfare did increase, the government has taken measures to means test various things and the Coalition has tried to vote against them on those occasions.
BILLSON
How on earth can you contrast an era of sustained budget surpluses where government debt was paid out and down...
BRADBURY
Bruce, what about the global financial crisis?
BILLSON
When there was cash in the bank of $70 billion and you get to that point where now, even last night you heard Bob Carr saying the revenue that's come in from the mining boom was unimaginable even five years ago, so you've got one side of the government talking about how there are these enormous revenue streams coming in, you've got David Bradbury and others talking about how everything is so peachy, then when someone comes out and says the footing under which the government is operating is unsustainable they then get attacked. What the concern is that the government has shown no capacity to live within its means at a time of enormous revenue flows, enormous revenue flows. The debt escalation figures in the four largest deficits in this nation's history and David Murray was basically saying you can't keep going this way and you can't keep not only spending these revenue streams from the mining boom you need to put something back into the economy. The analogy that I would present, it's a bit like someone receiving a gift of money going and buying a new car then going and spending more money to put a great sound system in it but not doing the work to maintain the car in working order so it can be productive and ready to support prosperity into the future. That's what real Australian people are talking about, not this politicking David goes on about where he can't even mention wheat in an earlier answer and defaults to some partisan argument.
GILBERT
Okay but David in terms of the criticisms that have been levelled not just at your government, the Gillard Government, but the Howard Government, it's something that economists have been saying. It's not that David Murray has been out of the general opinion when it comes to, Chris Richardson says it all the time when it comes to the need to reform the welfare bill, that's the core argument here.
BRADBURY
Lets deal with that question, but let's also put to one side this ridiculous comparison between the Australian economy and the Greek economy, that's what I was taking umbrage with that people that make irresponsible statements like that take the debate into a place that frankly is not a constructive debate that is going to be had in this country. The question of making sure our income as a government is proportionate to the expenditure commitments that we've signed up to, let's have a look at what this government has actually done. Every single step of the way where we have taken measures to constrain the growth of middle class welfare as it were, particularly with means testing arrangements we've put in place that are difficult things to do in the electorate, but if you want a sustainable economy in the long run you've got to undertake some of these measures. Every single time we've put in place one of these measures the opposition has opposed them, they've opposed them.
GILBERT
But will there be more of them? That's the point that David Murray makes there.
BRADBURY
We will continue to make sure that the expenditure commitments that we're signed up to are sustainable in the longer term...
GILBERT
So that's a yes?
BRADBURY
But let me make this point, the opposition has a $70 billion black hole, they have no plans in terms of how they intend to fill that black hole, well none that they've been prepared to share with us...
GILBERT
They're not in government, you're in government will there be more reigning in of middle class welfare in MYEFO the mid year forecast.
BRADBURY
I'm not going to speculate on what is going to be in MYEFO but let me restate this point, every single step that we have undertaken to try and make government expenditure on a more sustainable footing, take the private health insurance rebate. Means testing of that rebate that would have to be one of the best examples of how you might be able to restrain government expenditure that would otherwise be blowing out overtime. We did it, we had to do it without their support. What are the things that they would do in order to...
GILBERT
We've got to take a break I'm sorry to interrupt you both there, we'll be back in a moment with Bruce Billson and David Bradbury.
BREAK
GILBERT - This is AM Agenda thanks for your company. With me this morning is the Assistant Treasurer David Bradbury and the Shadow Minister for Small Business Bruce Billson. I should point out that breaking news we had for you in the first half of the show that a police officer at Maroubra police station has confirmed that the former HSU Chief Williamson has entered that police station just after 8am and police have confirmed in a statement that a 59 year old man had been arrested at the station for attempting to hinder investigations into fraud against, and corruption within the HSU so detectives anticipate charging him with a number of offences relating to the hindering of investigations, there will be a media briefing at Maroubra at 10am this morning of course we will have that live as it happens. Let's go back to our discussion with Bruce and David here, the Slipper saga continues the Slipper-Ashby saga, David in the courts the mediation failed, what are we to make of this? It just seems to continue no doubt the judge will be angry that they weren't able to mediate it.
BRADBURY
I don't think there is a lot that I can add to this. There are parties that are before the courts, obviously where there are opportunities to resolve matters outside of the court process that's something that should be encouraged. If the parties can't reach agreement then ultimately I guess it is a matter for the courts and they will have their day in court.
GILBERT
That's a fair assessment isn't it Bruce?
BILLSON
Yeah perfectly reasonable and more circumspect than when our Attorney-General was acting as a court reporter offering a gratuitous running commentary on the merits of the case, that was a sorry moment, let the court process play out as it should and let an individual that has raised very concerning sexual harassment concerns in the workplace have the opportunity to raise those in the proper forum. So that needs to be resolved at some point, it's been dragging on for a long time and occupying a lot of discussion as well Kieran. I was speaking with a man who was told he would lose his job before Christmas the other day down in my electorate and he was very concerned about that circumstance and would probably like political figures to be more focussed on his real life challenges rather than these peripheral things that occupy an awful lot of airtime.
GILBERT
Two minutes left on the show and this is probably something most of our viewers would be over as well and that's the fallout from the Jones matter. The Prime Minister received quite a heartfelt expression of support at the community cabinet, we don't have time to play it for you many of our viewers have seen it throughout the morning and they'll play it again in our 9 o'clock bulletin, but you've seen the tone of it David but the Prime Minister not wanting to engage on it, is she handling this in the appropriate manner?
BRADBURY
I think she is, frankly I think people make comments that are beneath contempt and frankly you don't dignify them by engaging in discussion about them. I think, just to give you an example, I had someone in my electorate ring me up and say I just wanted to pass on my thoughts to the Prime Minister and can you convey that to her. So I think a lot of Australians have been deeply offended by this and it's not surprise, they are very offensive comments.
GILBERT
There was one last night at the community cabinet, Bruce, as I mentioned that expressed his support, wrote a letter to the Prime Minister and her family. Do you think there is an element of that in reaction to the Jones matter?
BILLSON
Yes, I do. Everyone felt the grief that the Prime Minister felt after the passing of her father and the episodes that followed after just add another layer of sadness that wasn't necessary. The other feedback I'm getting too is that people are seeing the Labor Ministers desperately trying to overreach to fit up some negative imputation on the Coalition out of that. People are seeing straight through that. I think the Prime Minister deserves support at a time of great grieving for her, she didn't need this additional layer on top of it, but the efforts of Labor Ministers to make some political hay out of it is just repugnant also.
GILBERT
Alright we're out of time. Bruce Billson and David Bradbury I appreciate your time as always this morning, thanks for a robust discussion, we'll see you soon.