CHRIS UHLMANN:
Joe Hockey is the Treasurer and he joins me now. Welcome to AM.
TREASURER:
Good morning, Chris.
CHRIS UHLMANN:
Did you have a single conversation with any of the state Premiers about how they might manage when you withdrew $80 billion?
TREASURER:
Well, I have had conversations with a number of the states over the last few months, certainly more than my predecessors, and the fact is that the states are going to receive more in this Budget than they’ve ever received; in fact the increaseIn the Budget is substantial compared to, even our half yearly updates. They say that after 2017 they will lose $80 billion on schools on hospitals. They are actually getting $400 billion from the Commonwealth Government, and the fact is, the bonus pool that Julia Gillard and Kevin Rudd committed on schools and hospitals was never funded, was never funded. So we all get money from the same taxpayer, so the question is whether it is the Federal Government or the State Government.
CHRIS UHLMANN:
They signed an agreement with the Commonwealth that they thought would be honoured. Surely you should honour the next Government’s…
TREASURER:
Yeah we’ve honoured, yeah we’ve honoured; certainly Gonski is totally honoured…
CHRIS UHLMANN:
For four years…
TREASURER:
Well we said before the election, we were only going to commit to four years, we’ve honoured that agreement. In fact we topped it up with an additional $1.2 billion because Labor ripped that out. And in relation to hospitals we continue to increase the funding for the next ten years by over 1.7 per cent so that’s above inflation.
CHRIS UHLMANN::
You have a diagram in front of you which shows where the proposed funding was going to go and where it does ends up is much lower than where the States thought and they would have budgeted on that behalf. They would have hired teachers; they would have hired doctors on the basis of those figures that you are looking at.
TREASURER:
And it doesn’t mean those people won’t still have jobs but the issue is who is going to pay for it. Is it going to be the level of government that actually runs the hospitals and runs the schools or is going to be another level of government that does not run hospitals and schools, which is us?
CHRIS UHLMANN:
And that is entirely the problem isn’t it because you would know that the state budget would be entirely consumed by what they spend on health over the next 50 years if there isn’t more money.
TREASURER:
Well, this is exactly why we need to have the changes that we are proposing in the health system by having a co-payment of $7 when you visit a GP. The money goes into further medical research and if we put it in to medical research then we can find the cure for cancer and Alzheimer’s and heart disease.
CHRIS UHLMANN:
But it is coming out of public hospitals?
TREASURER:
Well, the fact is, we are going to have to put more money into public hospitals and the Federal Government is putting in more money into federal hospitals and state hospitals but, but I would say to you Chris, one of the things that quite astounds me is some people are screaming about a $7 co-payment; one packet of cigarettes costs $22, that gives you three visits to the doctor, you can spend just over $3 on a midi of beer, so that’s two midis of beer to go to the doctor. Let’s have some perspective about the costs of taking care of our heath and is a parent really going to deny their sick child a visit to the doctor which is going to be the equivalent payment of a couple of beers or one third of a pack of cigarettes?
CHRIS UHLMANN:
Well if you were 27 years old and had lost your job and weren’t getting unemployment benefits you might not have the choice of a midi of beer or a packet of cigarettes or a visit to the doctor.
TREASURER:
Well, I would expect to be in a job, that would be the starting point, you would be in a job. And we need you to work.
CHRIS UHLMANN:
What if you can’t…
TREASURER:
Well that is what we have to got to do. Everything we are doing is about lifting the tide so we can get more people in to jobs.
CHRIS UHLMANN:
But you can understand people who are on fixed income, pensioners for example, might find it hard to buy a midi, go and gamble money or go to the doctor, they might have to make choices in life.
TREASURER:
Well, we do have to make choices and so certainly our healthcare has got to be our primary consideration. But the thing is we make choices every day. I think people need to focus on their health over the medium and long term, and to do so, we need to invest a little bit and a co-payment is going to help to do that.
CHRIS UHLMANN:
Do you agree the States do not have enough money to fund these services into the future and they’re going to have to find another revenue source?
TREASURER:
Well, Chris we are going to have to find another revenue source if it is going to be funded. It is the same taxpayer, so either it comes from the Federal Government or the State Government; we don’t run the hospitals.
CHRIS UHLMANN:
Well, the only obvious place for them to go is to lift the rate or broaden the base of the GST.
TREASURER:
Well, that is up to them.
CHRIS UHLMANN:
No it is up to you as well. It is Commonwealth legislation, the tax office collects it.
TREASURER:
Well, yes but I have said to the States it is up to them.
CHRIS UHLMANN:
Well, you expect them now to come cap in hand and ask you to raise the GST because where else are they going to get the funding from?
TREASURER:
Well, this is a matter for debate but I will just say to you, what this illustrates is the structural problem left behind by Labor and as you know…
CHRIS UHLMANN:
But you have admitted it is not just the Labor Party that left this structural problem, the Howard Government left this structural problem. You are taking $7 billion out of family payments which all came in under the Labor Government.
TREASURER:
But Chris, we didn’t put in these bonus agreements on hospitals and schools that Labor put in, we didn’t do that. Labor never funded them and therefore someone has to find the money, I would just say to you, it is now time for Bill Shorten to explain to the Australian people how he would pay for all these things, where he would find the money to plug the holes left by Labor because it is not good enough to stand up tonight and just give Australia a lecture about politics, he has to actually provide policy alternatives.
CHRIS UHLMANN:
Do you know if you are here long enough you hear the same things said over and over again and I do recall the Labor Party said to Tony Abbott in each of the three years where he was giving exactly the same reply, that he should do the same thing. I don’t recall that he did lay out an economic plan.
TREASURER:
Well he did, he actually did. He stood up, he stood up in one Budget in Reply Speech and said that we are getting rid of the School Kids Bonus. He had the courage to do that and he did that. Now is the time for Bill Shorten to show the same sort of courage.
CHRIS UHLMANN:
Do you think that large chunks of your plan are going to be knocked off in the Senate and did you plan for that?
TREASURER:
Well, I don’t know but I’d hope people would back good policy.
CHRIS UHLMANN:
Will you negotiate yourself with the Senators?
TREASURER:
Well, I am always ready to talk.
CHRIS UHLMANN:
Will the Prime Minster negotiate with the Senators?
TREASURER:
I am sure he is always ready to talk as well.
CHRIS UHLMANN:
When John Howard of course wanted to get the GST through the Senate he was more than prepared to talk to senators.
TREASURER:
Well senators are human beings; they do have their own unique way of passing legislation – we are always prepared to talk with them.
CHRIS UHLMANN:
Finally Joe Hockey, is the Budget going about as well as you’d hoped at this particular point in time? Better or worse?
TREASURER:
Wel,l what matters is the outcome and we are working on that Chris. We are very focused on building a stronger economy and this is the sort of way to do it.
CHRIS UHLMANN:
Federal Treasurer Joe Hockey, thank you.
TREASURER:
Thank you.