JOURNALIST:
You have been saying we have to keep spending tight because of defence priorities, but we have got this multi-billion dollar Medicare package, are you struggling to keep the locks on the Treasury?
TREASURER:
Well, obviously this is a very large announcement to improve Medicare, MedicarePlus, to make it even better, and it is $2.4 billion over four years. Now, that will have to be paid for, and it will be important that we adequately fund that package. But I can assure you, that we will not be allowing the Budget to go into deficit. We have brought down six surplus Budgets and repaid $66 billion worth of Labor debt. So, we will be ensuring that services are adequately and properly funded and keeping our Budget in surplus as well.
JOURNALIST:
Doesn't it suggest there is a big bucket of money there?
TREASURER:
No, it's, over the last eight years, we have driven the Budget into surplus - it was $10 billion in deficit when our Government was elected - we have kept it there. We have now repaid $66 billion worth of Labor's debt, and we are getting some of the economic pay-off from that.
JOURNALIST:
Is there any room for negotiation with the minor parties on making that package any bigger?
TREASURER:
I don't know that it is needed. I think it is a fair package and I call on the minor parties to support it. I think it will improve our health system.
JOURNALIST:
Are you disappointed the Prime Minister has chosen to support two, the two Senators in Victoria when you would much prefer to see Michael Ronaldson get in there?
TREASURER:
Well, look, the preselections in Victoria or in any other area of the Liberal Party are for the members. It is not determined by me. It is not determined by the Prime Minister. It is determined by the Liberal Party membership. They are the people that join up and they are the people that will vote. And I have every confidence that they will make good decisions as they have in the past.
JOURNALIST:
But you would prefer to see Michael Ronaldson in there?
TREASURER:
Oh well, I don't comment on preselection matters, I never have.
JOURNALIST:
Mr Costello, is there any merit to the suggestion by the Reserve Bank that a review of negative gearing is needed?
TREASURER:
Well, there is no merit to the suggestion that negative gearing be abolished, no.
JOURNALIST:
What is your view on the situation?
TREASURER:
Well, I think that in relation to property as in relation to other areas, where you make losses, you can set them off against profits. And you are only taxed on your assessable income and that is the situation that has applied in relation to property since Mr Keating disastrously tried to change it in 1986. And the effect of those changes were to drive up rents. I would not want to see rents driven up by tax changes.
JOURNALIST:
And Treasurer, when can we expect the Mid-Year Economic Review?
TREASURER:
Early December, I would think.
JOURNALIST:
Okay.
TREASURER:
Thanks.