NADINE CHALMERS-ROSS:
Australia’s Treasurer is making his first bilateral to New Zealand after delivering a Budget to his country that slashed spending by billions of dollars. So, how might the state of their books affect the chance Kiwis living there will get access to the same benefits that Australians living here get? Australian Treasurer Joe Hockey is with me now from Wellington. Good morning to you Treasurer. As I mentioned, you did announce major cuts in that Budget and with Twitter hashtags like reverse Robin Hood and advance Australian unfair, is it fair to say it wasn’t received that well?
TREASURER:
Well, there is a very good lesson you learn in politics and I have observed it here in New Zealand: if you make the difficult but hugely important decisions upfront then you get the benefits further down the track. Now, here in New Zealand the Key Government made difficult decisions about the Budget and as a result you have got an economy that in many ways, is the envy of the world and Kiwis for the first time are more likely to come home than travel overseas for work. So, there are lessons that here we can learn in Australia and that is why as part of the Abbott Government, I delivered a tough Budget but not the hardest Budget that Australia has ever had but a tough Budget because the dividends have to flow further down the track.
NADINE CHALMERS-ROSS:
New Zealand’s state of the books then is the envy of the world? Are they the envy of Australia? We’ve often looked across the Tasman rather enviously at the lucky country. Have the tables turned?
TREASURER:
Well, I don’t want to give away too much to the Kiwis at the moment but quite frankly, you guys have done a splendid job. I mean, it is really a terrific job. The Key Government is a standout Government around the world and as a result of that, you are heading towards a surplus. You are about to deliver a surplus Budget and that means New Zealand starts living within its means. Australia this year has had a $50 billion deficit and in the current year, we are expecting a $40 billion deficit so we have a long way to go to catch up to the Budget position of New Zealand. Having said that, we are not about to give you back the Bledisloe Cup yet.
NADINE CHALMERS-ROSS:
You talk about that $50 billion deficit and then getting it down to $40 billion. Where did things go so wrong cause just a few years back, Australia was forecasting being back in surplus and New Zealand was saying, well you know, they are doing a lot better than us on that living within their means front?
TREASURER:
Well, sadly I mean we have had a string of, in recent times, bad Labor Governments. You had Kevin Rudd and Julia Gillard and they took us from being in a position six years ago, where we had $70 billion of assets in the bank and a surplus of $20 billion, to a position now, that if we don’t take in Australia, we are going to end up with $667 billion of debt and ongoing deficits as far as the eye can see. So, you have got to make these decisions, and they are not ideological. I mean, whether it is Bill English or Joe Hockey or anyone else, it is not about ideology it is about making sure you can create the jobs and live within your means as you go forward.
NADINE CHALMERS-ROSS:
You do sound a lot like Bill English with the rhetoric of blaming the previous Government and talking about living within your means but I do just have one question for you…
TREASURER:
Well, the numbers tell the facts Nadine. You shouldn’t be as cynical as Australian journalists are.
NADINE CHALMERS-ROSS:
No apologies for being slightly cynical. I do want to ask you about one policy that you did introduce this year: raising the retirement age which is often thought in New Zealand politics as political suicide. Why did you decide that it was so important to do it?
TREASURER:
Well, in Australia when the age pension was introduced in the early 1900s for men and women aged 65, life expectancy was 56. Today, life expectancy is 84 and in Australia today, and probably in New Zealand – same case, it is likely one in three children born today are going to live to 100.
NADINE CHALMERS-ROSS:
So, are you going to tell you friend Bill English to bite the bullet too?
TREASURER:
What I say to Bill English is between Bill and myself but having said that, if you want to run a campaign to follow Australia and increase the eligibility age to 70, that’s your call. From our perspective, it is the right policy. Our political opponents started it so it is not as if there is a great division in Australia about it. Labor increased it from 65 to 67 by the year 2023, we are increasing it to 70 by 2035. It is about how we can make sure that our welfare system is sustainable over the long term.
NADINE CHALMERS-ROSS:
Absolutely and perhaps we need the same sort of political consensus here before it happens. Thank you very much for your time. That is the Australian Treasurer, Joe Hockey.