CLARK:
Mr Costello good afternoon to you.
TREASURER:
Good to be with you Philip.
CLARK:
I am well, I hope you are surviving, how are you bearing up?
TREASURER:
Not too bad, yes. Which Grand Final was I in the middle of?
CLARK:
Well I was sitting in a pub and watching the AFL Grand Final and the next thing I know there is a great big picture of Peter Costello but it was bagging you because the Labor Party had…
TREASURER:
Oh, I didn't even see it Philip…
CLARK:
…they were…
TREASURER:
…they had it during the Grand Final?
CLARK:
…well they were bagging you, that's right, I think it was before or after Alistair Lynch had been whacking Gavin, belting somebody, but anyway that is the way it was.
TREASURER:
Isn't that incredible?
CLARK:
Well look, it is an issue, isn't it? The fact that you have been made the centrepiece of a negative campaign, how do you feel about that?
TREASURER:
Well look, politics is, you have got to take these things and you have take them all in your stride but I must say, I think it has been a pretty ineffective campaign. For our part, we think that it is money that the Labor Party has been wasting so we don't actually mind. We feel quite happy about it to be frank.
CLARK:
What because your poll is telling you feel that Peter Costello is a positive for the Liberal Party?
TREASURER:
Well, if that is the best that they can do, well we think it is money which has been badly spent by them and from our point of view we would rather them spend their money on bad advertising than good advertising.
CLARK:
I wonder how firstly it makes you feel though to see yourself the subject of a negative advertising campaign saying you are the thing that everyone should fear.
TREASURER:
Well I don't think it actually gets that message across actually…
CLARK:
I mean that is the point of the, whether or not people are attracted to it or not is another matter I guess.
TREASURER:
…yes, well that is my point, you see I don't think it does get that message across and that is why I don't think it is effective and that is why I think it is money badly spent and I would rather the Labor Party spend their money badly rather than spend it well. It just, you know, if Mark Latham really had a reason why people should vote for him I don't think he would be running ads like that you know what I mean. I think it is very weak.
CLARK:
Yes, negative advertising I suppose has always got its critics, I mean plenty on your side I suppose with Mark Latham and his record on the Liverpool Council, though.
TREASURER:
Well you see in politics you are entitled to look at people's record and people can look at my record as a Treasurer and I, you know, on interest rates, on inflation, on employment, on Budgets, I am happy for them to look at that. If you want to look at Mr Latham's record he hasn't had ministerial experience. The only time he has been in charge of managing something was the Liverpool Council so that is the only record he has got and that is why you have got to go back and have a look at these things. If Mr Latham had had more relevant experience we could look at the record but unfortunately he hasn't so you have got to look at the only experience he has had and that is the Liverpool Council.
CLARK:
The trend of polls is heading your way, Centrebet and other betting agencies have you as favourites for it, is it in the bag?
TREASURER:
Oh no, either side could win this election and there are still three days to go and if the poll…
CLARK:
Where is it going to swing do you think?
TREASURER:
…well if the polls are any guide, there are a large proportion of people that don't make up their mind until the last 48 hours, so in the last 48 hours the people that are still deciding are enough to actually swing the election so I don't think either side could say that they are going to win at this stage, I think it is incredibly close. Where will it be decided? Well…
CLARK:
Not in New South Wales I wouldn't have thought.
TREASURER:
…most elections are decided in the marginal seats as you know. There are a couple in New South Wales, very marginal seats, seats like Eden-Monaro for example down on the South Coast. Seats in the Western Suburbs of Sydney that have been swing seats in the past. But you are quite right, maybe there aren't that many in New South Wales. There seems to be a few in Queensland, a few in Victoria. That is the thing about a National Parliament, you have got 150 seats and every state plays a part.
CLARK:
Is there somewhere you will be looking at though? I mean there are plenty of people who for example would be saying, I will be looking, we would be looking at South Australia because there are a few seats there that could go either way.
TREASURER:
A few seats in South Australia…
CLARK:
Yes.
TREASURER:
…could go either way, you are quite right about that.
CLARK:
I mean the net position in Victoria and New South Wales I think on balance is not going to change that much, even…
TREASURER:
People always say that Eden-Monaro is a swing seat, it normally goes with the Government. That is where Gary Nairn has been the Member, the Coalition Member for some time, a well known local, so I keep my eye on what is happening in Eden-Monaro, but as you say there will be a whole host of other ones as well Philip.
CLARK:
Both sides have spent like mad things at a bargain sale which is not, I must say, a message that I am sure everyone in the community feels happy about, being used over the years to a message from Canberra about surpluses in Federal Budgets and responsible management and so forth, and yet it has been a furious spending spree on your side in particular, how do you feel about that as Treasurer?
TREASURER:
Well the promises that the Coalition have made are much more moderate than the promises the Labor Party have made in this election, so let's put that point on the table. But having said that, it is important to keep the Budget in surplus. We were the Government that brought the…
CLARK:
Will it stay in surplus?
TREASURER:
…we were the Government that brought it out of deficit and put it back into the black and we are the Government that will keep it there. I can assure you of that. Having produced seven surplus Budgets over the last eight and a half years we have got no intention to go back to the bad old days of Labor, so we will keep it there, absolutely. And we have made sure that the promises that we have made are affordable, consistent with good economic management and low interest rates, because, the thing about low interest rates, it is not just for home buyers to keep the pressure off them, but it is also for businesses. Businesses need low interest rates if they are going to create jobs. So, there are many people, particularly retirees, who say: why do you always go on about low interest rates? We used to like Labor's high interest rates, some of them say, and the point that you have got to make is it is not just for home buyers who obviously like low interest rates, but it is also for business because if business doesn't have a good environment then they are not going to create the jobs that we all need.
CLARK:
Do you wish you had gone with the Medicare Gold package, I mean it was offered to you?
TREASURER:
Oh no, that is, that is…
CLARK:
I mean the (inaudible) has offered it to you, I mean you did think about it, why didn't you go with it?
TREASURER:
Well that is a financial quagmire. Mark my words, if Mr Latham is elected he will never introduce that because the financial costings that he has put forward are way off the mark by as much as $2.5 billion per annum, and everybody agrees on that and the cost of that will escalate over time as the population ages. And over time that will become financially unsustainable, there is no doubt about that. No Government is Australia will be introducing a package like that even if Mr Latham is elected he will have to crawl his way out of that one.
CLARK:
In the end, the amount of money spent on health will overwhelm all of us, unless we fundamentally re-jig the system.
TREASURER:
Well that is the point, you see as people live longer…
CLARK:
Correct.
TREASURER:
…and as technology improves, we have got the ability to treat diseases that we didn't, that we couldn't treat in the past and we have got people living longer and getting more sophisticated medical treatment and the aging of the population means that instead of having five tax payers to support each person of retirement age you are going to have 2 ½. And you better think of some ways that we are going to sustain all of these costs. I have been banging on about this for a long time, the ageing of the population with my intergenerational report, saying that we have got to get sustainability for pharmaceuticals, we have got to get sustainability in relation to health care because…
CLARK:
But neither side have really advanced that argument in the campaign have we? I mean we have seen nothing really that advances that, we have really just seen additional spending.
TREASURER:
Well we have been, because I have been advancing the argument that we should have incentives for people to take out, older people to take out private health insurance. We shouldn't be trying to tell older people to give up their private health insurance which is what Medicare Gold is all about, Mr Latham says, get rid of your private health insurance, you won't need it because I will make a promise to you. Well if you want to take a risk, take it, but my message is, we need to encourage people to keep their private health insurance. We should have higher incentives for older Australians which we are introducing, 35 per cent rebate if you are 65, and 45 per cent rebate of you are 70, because we had to make sure not just that the health system is there, but it is sustainable as we all live longer and as medical technology improves.
CLARK:
Alright, you have been in politics for a long time, you have been Treasurer for a long time, you still want to keep the Treasurer's job after the election?
TREASURER:
Oh yes…
CLARK:
Or would you like to try something else, I mean…?
TREASURER:
…no, no, I have made it clear that, imagine the economy, it is an $800 billion economy, it takes a lot of work and a lot of application and I think it is the basis for all we do. If we don't have a strong economy we won't have a good health system or education system, we won't have strong business or employment.
CLARK:
…no doubt about that, but is that where you want to stay?
TREASURER:
Yes, so I have made it entirely clear that I am running for re-election as Treasurer, yes.
CLARK:
But you, I mean I am not asking a trick question, I am saying you would rather stay there rather than seek another senior portfolio?
TREASURER:
Oh yes, I am running for re-election as Treasurer.
CLARK:
You said after Mr Howard decided that he would stay on that you would feel able and would want to speak out more freely on a whole lot of, a whole range of issues…
TREASURER:
Yes.
CLARK:
…there hasn't been much of that…
TREASURER:
Well I think…
CLARK:
…why is that?
TREASURER:
…if you went back through my website you would find an awful lot, an awful lot…
CLARK:
Well that is worse, that means people aren't paying any attention.
TREASURER:
Well look, you fight for coverage in this business and I think a lot of people would say: well yes, in the media, if you are the Treasurer, when you speak on economic matters, you can move markets, so that gets a lot of coverage. When you speak on non-economic matters, they are not as inclined to give you the coverage. But I have given a lot of speeches on foreign aid, on social capital, on community, on the basis of our society, how to improve it, how to strengthen it in a non-economics sense.
CLARK:
There will be more of that after the election from you?
TREASURER:
If I get the chance I would love to and if it can get reported, even better.
CLARK:
Well obviously we will talk again but you are still keeping your powder dry?
TREASURER:
Well I am engaging in wide ranging matters, but I want to assure you of this, that I am absolutely focused on keeping the Australian economy strong, that is what I regard as my number one priority and that is what I will be doing if we are re-elected.
CLARK:
Good to talk to you Peter Costello.
TREASURER:
Thanks very much for your time Philip.