TREASURER:
Standard & Poors, just as Moody’s did about a month ago, have warned, that unless corrective action is taken on the Budget, then there is a debt and deficit trajectory that could represent a very significant threat to our AAA rating and I think what concerns me the most is that they are banking it on bi-partisan support for fixing the Budget and so far, Bill Shorten, for the first time, has taken the Labor Party in a different direction on the Budget and wants to see increasing deficits and increasing debt.
ALEXANDRA KIRK:
But the ratings agency does say that it expects compromises will be reached eventually; it doesn’t say with whom, so the Budget performance gradually improves. Now, the key words are compromise and eventually. There is no mention of any crisis or urgency or Labor.
TREASURER:
Well, it was also John Edwards who said, ‘get on with the job of dealing with the Budget crisis’. John Edwards was an advisor to Paul Keating on the economy and was appointed by Wayne Swan to the Reserve Bank Board. In fact, Paul Keating and Bob Hawke said that you need to have a very tight Budget; you need to have very significant savings. The only people in denial about the state of the Budget are the post-election Labor Party who are opposing everything and offering nothing.
ALEXANDRA KIRK:
So, are you talking turkey with the cross-bench Senators? And when Parliament resumes in a few weeks’ time, will you be in a position to get some more of your Budget through?
TREASURER:
Well, it is a work in progress and the fact is that I will search anywhere for some people that are prepared to take a very common sense approach to dealing with the deficit and the debt. I think there a number of Senators that are very responsible in that way and I am looking to work with them but frankly, I am surprised that Labor and the Greens have dealt themselves out of any discussions.
ALEXANDRA KIRK:
Now, you recently threatened the Senate that if they didn’t pass your Budget, you’d bypass Parliament altogether and find other ways to cut spending. Now, since then it appears you have dropped it like a hotcake, so was it just an empty threat?
TREASURER:
No, because you know the irony is, for example, when the Labor Party says in good faith that they will support an initiative, we think they will. So, the Labor Party said that they would prosecute the case for their Amendments to the Asset Recycling Fund and if they were unacceptable they would still allow the Asset Recycling Fund to pass the Parliament. Well, they misled – deliberately mislead the Australian people and deliberately misled us and haven’t kept their word that they would facilitate its passage. So, we will seek to appropriate the money so that we can get on with building the infrastructure that Australia needs.
ALEXANDRA KIRK:
And can you do that without going through the Parliament?
TREASURER:
Well, it would be a part of Appropriations. So, the Labor Party would need to block appropriations.
ALEXANDRA KIRK:
And can you do it with other things like that?
TREASURER:
Well, I want to work with the Senate. I thought the Labor Party supported getting the Budget back to surplus yet they are opposing their own savings initiatives from the last Budget. So, go figure that.
ALEXANDRA KIRK:
Over the last couple of days, the Government has announced yet another crack down on the unemployed. Where is the evidence that making them apply for 40 jobs a month will actually increase their chance of them getting a job? Have you done any research to prove that?
TREASURER:
Obviously it is the case that you can’t get a job if you don’t apply for it. So, the harder you work at getting a job, the more likely you are to actually get work.
ALEXANDRA KIRK:
Well nobody is questioning that, they are questioning 40 a month.
TREASURER:
But that is the principle. Whether it is 40 or 50 or 30, people who are on unemployment benefits need to get into work and we want them to get into work and in some cases they might not be as committed as they should be to going out and preparing a CV and getting to work.
ALEXANDRA KIRK:
Well, the business lobby says that it is impractical to make people apply for 40 jobs a month in the current softening labour market. So, won’t you just be flooding employers with low quality or unqualified applicants and that would create more red tape and discourage employers from using job ads to…
TREASURER:
I want to harden the market for jobs, I want to harden the opportunities for people to get into work but I would say to you Alex, Labor inherited 4.1 per cent unemployment and left us with unemployment heading to 6.25 per cent. So, I don’t think they are in any position to lecture on the best way to (inaudible) jobs.
ALEXANDRA KIRK:
It’s not Labor who are saying this; it’s actually the business lobby.
TREASURER:
No, the business lobby – I can understand they are worried about getting a flood of people looking for work but as a former employer myself, I know that sometimes the hungriest people looking for work – that is hungry for work and hungry to work, are some of the best employees and in that sense it will give business an opportunity. And look on the other hand, I have a number of business people that often come up and say, ‘we find it hard getting people to apply to come and work here’. So, it swings and roundabouts but the bottom line is, we need people to go into work.
ALEXANDRA KIRK:
Won’t the effect be that people that are unemployed will lose heart, they won’t fulfil the monthly quota of job applications at 40 a month, so they will end up getting cut off the Dole and that will reduce welfare spending; is that the Government’s plan?
TREASURER:
No.