BORRELLO:
Steve Ciobo, thanks for joining us.
CIOBO:
Pleasure.
BORRELLO:
The Treasurer is meeting the US Treasury Secretary Jack Lew today. We expect they’ll be talking about the US Federal Reserve’s decision to wind back its economic stimulus. How do you perceive that playing out in Australia?
CIOBO:
Well there’s no doubt that there’s been a lot of commentary about what the impact of the Fed’s tapering is in the US. Clearly there’s a divergence of opinion and a range of views globally about what the implications are of that: especially for emerging markets. Look, for Australia, the tapering itself I don’t think is a negative. In reality, if anything, it’s probably going to help with the Australian Dollar which has been an ongoing problem, frankly, for us as a nation for some time.
BORRELLO:
The Government is on an election footing again, there’s going to be a re-run of the Western Australian Senate election: do you fear that you could lose seats that you’ve already won there?
CIOBO:
Well, in terms of the Senate outcome, what happens with an election being called – time will tell. There’s no doubt that it’s far from ideal and I’ve got no doubt that a lot of West Australians won’t be pleased at the prospect of having to go back and vote again in a Senate ballot. But that notwithstanding, it’s what the High Court has ruled in its capacity as the Court of Disputed Returns and ultimately, from us as the Government, the view is we’re putting our best foot forward. We’ve had to make some hard decisions: a lot of damage needs to be repaired. And we know that we’ve got to continue on with that process and that’s going to take some time.
We’d of course love the support of Western Australians because we’ve got an important job to do. In many respects, if you look at one of the key pieces of legislation that we’re trying to effect change with, which is of course the Carbon Tax, the problem is that it’s actually been in the Senate where we’re getting obstruction from the Greens and the Labor Party who frankly, don’t respect our mandate. So with the opportunity for another vote in Western Australia, if Australians still feel very strongly about the world’s biggest Carbon Tax Labor introduced, is a chance for them to cast their ballot again.
BORRELLO:
Do you think it’s fair to say that it will be a litmus test on how the Government’s gone so far?
CIOBO:
Well, I’ve no doubt that some commentators will report it that way. Certainly the Griffith by-election got an outcome were we saw a complete repudiation of Labor and the scare campaign that Labor has been running. What happens in Western Australia will be influenced by a range of factors. But I reassert that we are trying to implement our mandate: the abolition of the world’s biggest Carbon Tax that Labor introduced on the back of a lie. The Senate vote in Western Australia will be an opportunity to send a clear message, again, to the Labor Party and the Greens, that Australians want this Carbon Tax gone because it makes us less competitive and we’ve already said to the Labor Party and the Greens and they didn’t listen, that we want it gone.
BORRELLO:
Just back to tapering. Obviously you’re Joe Hockey’s Parliamentary Secretary, you would be aware that he is likely to be pressured by developing nations to argue against a further wind-back of the Federal Reserve’s stimulus. Do you feel that he’s inclined to make that argument?
CIOBO:
Look, we’re not going to be lecturing any countries about what to do. The purpose of the G20 this weekend is to set a path for growth and jobs. It’s going to attempt to build consensus around the G20 countries and the invited guest countries that are here this weekend with the intention of saying; “let’s collectively come together and actually set a more ambitious growth target”. Because by achieving that growth target we’ll be able to boost jobs: that is going to be the focus of this weekend, not sermonising to other countries about what they should be doing in terms of their own domestic considerations when it comes to monetary policy.
BORRELLO:
Have you had any soundings today, I know meetings don’t officially kick-off until tomorrow, but from any of your overseas colleagues whether they are receptive to the idea of setting a target?
CIOBO:
We remain optimistic; the Treasurer has set an ambitious plan in place. The Prime Minister outlined what our policy was going to be with respect to G20 throughout this year of our Presidency. We’re hopeful we will achieve a good outcome, in many respects our Presidency of the G20 and the Finance Minister’s stream which is happening this weekend will help to build a case and we remain optimistic that we’ll get a good outcome.
BORRELLO:
But will this number mean anything if you do actually get to a number by the end of the weekend? I’m assuming you’re after it by the end of the weekend, not the Brisbane meeting. Do you feel that in three years’ time, for example, that will have been met? Or will it just be another goal that you set a meeting and is gathering dust on a shelf?
CIOBO:
Well I think it’s important to differentiate, the G20 isn’t a talkfest. The G20 is a lot more nimble that a lot of other international bodies. Plus, by outlining very clearly to countries, ahead of time, that we are going to go for growth, we are optimistic that will see a commitment to implementing policies both domestically and internationally that are going to enable there to be a clearer pathway to achieving that outcome.
We recognise that, now in a post-GFC world, there’s still obviously some change that’s taking place, some rebalancing. But we’ve got to, as countries, come together to make sure that we can achieve the growth target that is, hopefully, reached this weekend because that is going to make a material difference to countries around the world, get people back into jobs and enable governments to further consolidate their balance sheets at a time when that’s necessary also.
BORRELLO:
Can you give us an indication of a figure? There have been reports of possibly five per cent, would that be in the vicinity that you’re after?
CIOBO:
Look I’m not going to get into speculation about that, that’s the purpose of the weekend.
BORRELLO:
And would it be over a ten-year period? What’s the timeframe for this percentage figure?
CIOBO:
Well, again, that’s going to be the subject of discussions this weekend. Clearly, if we can implement policies domestically and get agreement internationally about policies that various countries can implement in their own domestic environment to boost growth, then the sooner the better. The more growth that can be achieved in a shorter timeframe then obviously the better for the global economy, the better for governments’ fiscal books, the better for people’s employment prospects, the better to make sure that when the tide rises that all boats float and that really is what this Finance Ministers track is about.
BORRELLO:
Given, obviously, world leaders can be very different in five, definitely ten, years’ time, is it better to go for a smaller timeframe?
CIOBO:
Well listen, the Saint Petersburg meetings at the end of last year laid down the Finance Minister’s clear direction: that jobs and growth were the pre-eminent target that countries globally were going to strive for. Timeframes will vary and there will be discussion about whether it’s short, medium or long-term. Ultimately though, I think that rather than perhaps getting overly caught-up in whether it’s one year, three years, five years or a decade, is looking at what are the actual policy initiatives that are going to be undertaken, globally, by countries to achieve fiscal consolidation, but also to ensure that we do get growth and jobs.
BORRELLO:
You obviously want to spruik the Government’s push for public-sector assets to be sold to fund infrastructure, where exactly in Western Australia in particular, are you looking at, given Troy Buswell has definitely said he’s not interested in this at that stage?
CIOBO:
Well the Commission of Audit is having a look at what opportunities may exist – and I stress, may – exist for asset sales. We made it clear going into the last election, that the privatisation of Medibank Private was on the Government’s agenda, but we’re not speculating beyond that. The Commission of Audit has a task to undertake, they will provide advice to Government in due course and we’ll consider it then.
BORRELLO:
Is the obvious option there power assets?
CIOBO:
Well can only repeat again, that we’re not going to speculate about what there may be. The Commission of Audit has been tasked to perform a duty with respect to other possible asset sales and we’ll take a look at their advice.
BORRELLO:
If I could just ask you about Medicare. Peter Dutton has indicated that the Government is interested in looking at co-payments for medical services; is that in the form of a Medicare co-payment and would it be in the vicinity of the six dollars?
CIOBO:
I think you’re being quite specific. The reality is what Peter Dutton outlined was the need to make sure that Medicare is sustainable. The Prime Minister made comments yesterday that he’s a Leopard that doesn’t change its spots and he’s on the record for many years now saying that the Coalition was the best friend that Medicare ever had. So I think it’s prudent that we have a discussion about what is sustainable, I think it’s prudent that we recognise as a nation we have serious fiscal challenges.
We’ve been left with a smoking crater of debt and deficit by the former Labor Government, we have an enormous task to perform to repair that damage and health is one of the single biggest items in the Federal Government’s $400 billion a year budget. So it’s appropriate that we have a discussion without a lot of the political hysterics that we saw from the Labor Party. Incidentally Eliza, what we saw from Labor in the Griffith by-election was exactly the kind of hysterics that people, frankly, are over. And that’s why we saw a repudiation of Labor’s approach in that Griffith by-election outcome. So, we will see in the fullness of time what the outcome is going to be.
BORRELLO:
But do you think that we will see some kind of change to Medicare or medical payments in this Budget, or is it something you’re looking at and it may be done in a future budget year?
CIOBO:
All Australians would recognise that Medicare needs to be sustainable. All Australians would recognise that the nation’s finances need to be sustainable. As one of the biggest pieces of the fiscal jigsaw that is the Australian Budget, there is obviously scope for there to be reform to ensure that Medicare is sustainable. We’re a Government of no surprises, the Prime Minister has stressed that, the Prime Minister has also stressed that in his time as a former Health Minister that he wants the Coalition to be the best friend that Medicare ever had. That remains a central pillar of the Coalition’s approach in dealing with this issue and so speculation about exactly what it’s going to be and when it’s going to be implemented is nothing other than speculation.