KING:
Good afternoon Treasurer
TREASURER:
Good afternoon Madonna
KING:
I understand you have spent your lunchtime calling for reform to the Senate. Why is that so necessary?
TREASURER:
Well, we have laid down a program for some long term reforms in Australia coming out of our Intergenerational Report that are aiming to get changes in place for the next 30 and 40 years, changes that will be required to cope with the ageing of the population which is happening in all...
KING:
What kind of changes are we talking about?
TREASURER:
Changes which will put pharmaceutical benefits on a sustainable financial basis, that will reform our welfare system and that will lift participation in the workforce, and these changes, they are for next week or even for the next fortnight but, they are for twenty, thirty and forty years time. They have been blocked in the Senate and I think it is about time, that if we can't get sensible long term legislation through the Senate, that we have a look at reforming the Senate as well.
KING:
Okay, in what way?
TREASURER:
One of the things that I put forward today was a proposal that if legislation has been blocked twice in the Senate, and there is an election and the Government is returned, that could go straight to a joint sitting of both houses of Parliament and if there was a majority in a joint sitting, pass the bills into law. That would allow a Government which is re-elected to put through legislation that had been blocked by the Senate in a previous parliament.
KING:
And is this something that is seriously under consideration to try and get those three things through that you mentioned.
TREASURER:
Well, not just those things of course. They're the things that are being blocked at the moment, but if we were to change our Constitution and improve the way of resolving deadlocks in the Senate then it could apply to a lot of other legislation as well.
KING:
I can imagine the Senate will be recalcitrant on this too.
TREASURER:
Well, it need not be so.
KING:
But a lot of people will say that the Senate is there as a protection. You don't really have a right to reform it in that way and prevent them, as, you know, as the second tier.
TREASURER:
Well, this is another point that I was making today, that the Senators, these Senators have enormous power, but who knows them? Who knows who they are? How are they held accountable for their actions? You know, I guarantee that if you and I were to sit down now and try and name the Senators, we would have a lot of trouble doing so. I think the public would even have even more trouble doing so. They have got this enormous power, but because they are not hardly known in the public, they don't seem to be accountable and I think that is a reason why we should have a position whereby Government isn't held to ransom by these unaccountable Senators, but can manage to keep its legislative program going.
KING:
Would it be better if we didn't have a Senate at all?
TREASURER:
Well, that is another question. I don't think you will ever get round to abolishing the Senate, but what I'm pleading for, is a reform of the Senate which will make it work much better and be more accountable
KING:
And you're saying that they are totally unaccountable to voters?
TREASURER:
Well, Senators as you know get elected on - the Opposition Senators who are blocking legislation are elected on the Labor ticket...
KING:
But this will affect your Senators you know if the tables turn and eventually you're in Opposition.
TREASURER:
Sure. Very few people know who they are and yet they can hold a whole Government to ransom and I think the public, I don't know that the public has a mechanism for holding them accountable. It is not as if they are accountable to electors in a particular electorate. They are elected on a statewide basis and, you know, it is good to have a house of review. I've said in my speech today that a house of review should look at long term issues, but it is not good to have people blocking long-term reforms, turning the house of review into an obstructionst house.
KING:
Okay, on another topic. The Reserve Bank has contributed quite a bit to the Government's coffers, I think about two billion over the past financial year and now that windfall has been broken into two installments, one this year and one next year. Why is that?
TREASURER:
Well, we have had a policy of smoothing dividends when dividends are particularly large, rather than take them in one particular year. We did this some time ago. We have had a policy of smoothing them. There are a lot of companies that do the same, because otherwise large, bulky one-off dividends have the effect of artificially bolstering the accounts. Now we have entered into this policy and tried to set a benchmark and smooth the dividends for the sake of giving a more accurate picture.
KING:
Can you see how a cynic or even a voter might think that it gives you a nice little nest egg or a pre-election kitty for next year?
TREASURER:
Well, if we had wanted to, we could have taken full dividends this year. But I think it's better policy to smooth it rather than have a huge lump in one year and a small amount in another year to try and smooth it, so that it's a constant in your accounts.
KING:
Okay, I'm interested you are heading off to the Middle East. What do you hope to achieve in that trip?
TREASURER:
Well, I am going to the meeting of the International Monetary Fund in Dubai, where I will be representing Australia, but I hope on the way to be able to call in, in Israel. It is a difficult time there at the moment, as you know, and things are quite difficult with the outbreak of terrorism. But I do hope that I can call in and that I can meet some of the key players. I think...
KING:
As well as the economic issues you are looking at the wider interest (inaudible) of what is going on there.
TREASURER:
Absolutely. The great issue in the Middle East at the moment, is whether or not the road map to peace between Israel and Palestinians can be advanced and I will be hopefully speaking to people about that and seeing whether or not the road map can be advanced and whether progress can be made.
KING:
Okay, your comments on the Senate and your trip to the Middle East. Is this part of your stated aim to become more involved in public debate on issues outside the national economy.
TREASURER:
Well, I think Senate reform is now critical for Australia and, yes, I am going to engage in that debate. And of course Australia's economic position depends a lot on world conditions so...
KING:
But what is your next issue, apart from the national economy. What else are you going to speak out on?
TREASURER:
Well, look we will deal with these issues before we start new ones. There is plenty of work to be done I can assure you of that.
KING:
Okay Treasurer Peter Costello, thanks for your time