Interview with Jon Faine
WED 05 SEPTEMBER 2012
HOST: Julia Gillard, good morning to you.
PM: Good morning Jon.
HOST: The prophecies of the mining industry are starting to bear fruit. The predictions that they’ve made about some of the policies you’ve implemented are now starting to sound as if they are themselves accurate prophecies and advice that you should have heeded.
PM: Jon, let’s look at the facts and let’s look at the big picture.
We are a nation with $500 billion of mining investment in the pipeline, more than $200 billion of that in an advanced stage.
So we’ve got big investments in mining to come. Tens of billions of dollars of those investments have been committed to since we announced the Minerals Resource Rent Tax. The Minerals Resource Rent Tax is a profits-based tax.
That is, it understands the cycles that there are in commodity prices and consequently in mining itself and it takes tax at the time that the industry is at its most profitable.
We’ve got an economy that’s growing strongly – low unemployment, low inflation, low interest rates, low debt, triple-A rated government system from all of the major credits rating agencies. We’ve never had that before as a nation. So our economy is strong.
Yes, of course, Fortescue Metals made an announcement yesterday about some delays in work that it intends to do but the outlook for mining is strong – that’s the big picture.
HOST: Gina Rinehart released a video message to the conference and, amongst other things, she said that your policies are wrong:
GINA RINEHART: Now the evidence is unarguable that Australia is indeed becoming too expensive and too uncompetitive to do export-orientated business. What was too readily argued as the self-interested complaints of a greedy few is now becoming the accepted truth.
HOST: Self-interested complaints of a greedy few. Is that how you’ve characterised Gina Rinehart, Julia Gillard?
PM: Gina Rinehart has always been opposed to the Minerals Resource Rent Tax, she’s always been opposed to carbon pricing, she’s still opposed to the Minerals Resource Rent Tax, she’s still opposed to carbon pricing.
Where’s the news in that Jon? I don’t share her view.
HOST: And yet her view is starting to sound as if it has more and more support and, according to the commentary in newspapers-
PM: Only if you deny the facts John.
Five hundred billion dollars of investment in the pipeline, investments of record dimensions being made in Australia, a strongly growing economy, new investments announced since everybody knew about the Minerals Resource Rent Tax and carbon pricing.
To give you one statistic about carbon pricing, since we announced carbon pricing, business investment has gone up by 20 per cent. 20 per cent. They’re the facts.
HOST: So do you think the mining industry is insatiable? Is that the problem? They just seem to think they’re entitled to eternal growth. Is that their problem?
PM: The mining industry will keep growing Jon and I’m glad it’s going to keep growing.
I think it’s fantastic for our economy and our nation that mining is going to continue to grow. I do have a different view from Gina Rinehart and a number of others.
I think, as mining continues to grow, as we use this incredible wealth in our natural landscape, as we mine it, as we export it, as we generate that prosperity, that we should share some of that prosperity. I’ve got that view. They have a different view.
We’ve had that debate. Our nation’s resolved it. The Minerals Resource Rent Tax has started.
Because we need to cut carbon pollution, carbon pricing has started and when you look at the economic data, none of the grim predictions that were made about carbon pricing or the Minerals Resource Rent Tax have come true.
We are still seeing mining investments being announced. We are still seeing a growing economy. We are seeing quite spectacular growth in business investment. We’re still seeing low unemployment.
They’re the facts Jon.
HOST: You have expectations though and the expectations in Queensland and Western Australia are that even though prices are falling, the government shouldn’t be making their jobs even harder.
PM: Well Jon I just think we’re going around in the same loop. For our economy, what is happening in it? Well it is as I’ve described it to you.
Are there challenges in our world? Yes, we know that there are issues in Europe, there’s softness in the American economy, there’s been some reduction in growth rates in the Chinese economy, we’ve seen some coming off of commodity prices.
There are those effects in the real world, yes that’s true. Where does that leave our economy? It still leaves it growing, it still leaves record investments being made in mining. It still leaves us with low unemployment, low interest rates, strong public finances.
What does that mean that we need to do for the future? Well we need to understand that we live in the region of the world that is going to propel economic growth in this century.
The resources boom we’re seeing now is a down-payment on that.
We can be the recipients of much of the growth of the Asian middle-class – more demand for our food, more demand for our tourism, more demand for legal services, health services, tourism, high-end manufactured goods and the list goes on.
We’re pre-positioning to seize that future.
That’s what a clean energy future is about – pricing carbon, infrastructure and the NBN is about and, of course, it’s about what my drive for higher and higher skill levels is about.
HOST: Why do you use a mining conference to talk about education? The mining industry were expecting you to talk about matters relevant to them. Instead they got you talking about something they really, it’s not front of mind for them, the Gonski reforms.
PM: There’s nothing more important to the future of mining in this country than what’s happening in Australian schools today.
I have any number of mining people come to me and say that one of the constraints they face is that they can’t get the skilled labour that they need.
And, as we go through this resources boom, we see more investments being made, we see more mines actually moving to the production phase, we’re going to need geologists and we’re going to need engineers, we’re going to need tradies, we’re going to need people with skills and we’re only going to get those people if what’s happening in schools today is of the right quality and the right standard.
So it’s appropriate to go to a mining conference, to go to indeed any business event in this nation and talk about the standards and the future for Australian education.
HOST: All right, now your response to Gonski seems to be to talk about things that are going to happen more than ten years away from now and it’s almost meaningless unless you provide some of the dollars and some of the source of the funds that are going to be needed to implement these recommendations.
As we’ve said before the economy’s not a magic pudding and no one can see the substance in your response to Gonski.
PM: Well, Jon I’m very happy to address that question. We are out there reforming and improving schools today. We’ve been doing that since we were elected in 2007.
We’ve worked hard on school improvement: MySchool, new national curriculum, new investments in disadvantaged schools, more money in literacy and numeracy, better investments in teacher quality, empowering school principals, better rewards for the best teachers.
And we can now show you schools around the country where that combination of improvement and new resources has been brought together and it’s got results.
That is, the kids are doing better at their education. They’re doing better in writing, better in maths.
HOST: Australian standards are falling in international terms Prime Minister. That’s simply not what’s happening.
PM: Yes Jon, one day you and I can go out to Braybrook Secondary College and you can see the improvements that that combination of new ways of working and new resources has brought to a school in Melbourne’s west.
HOST: You can’t just cherry-pick one example. Overall we’re slipping.
PM: Jon, I’m going to answer your question if you let me. We are working to improve schools and I can point to examples around the country where we have driven standards up.
We now want to take that same combination of driving standards up and new resources right around the country to 9,500 schools. When you’re going to do something that big, it takes some time and that’s why it will take the six year transition.
Are we falling behind the standards of the world? Yes, Jon, we are and that is what is motivating me in part for this big crusade on education.
We have been improving our schools; other nations have been improving their schools more rapidly. It’s a race that everybody’s running but some people are running faster than us and we’ve got to move more quickly and make sure that we win that race.
That’s what I’ve been talking about this week. That’s what improving schools is all about.
HOST: Okay, yesterday the state government here, Minister Hall, said to us ‘show us the money’ effectively and we said well where’s your money and he was not happy with that line of questioning, but the same question to you Julia Gillard.
Unless you are prepared to show how much you put on the table and what it gets to be spent on, why should any of this well-meaning waffle be taken seriously?
PM: Well people can judge us on what we’ve done to date, given we have almost doubled the amount of money going to education, I think people would, hearing that, prick up their ears and go ‘Gee they must be serious about this’.
Number two, I’ve said the next step here is that I will go and discuss it with state premiers. I’ve had a discussion with Barry O’Farrell and he’s open to working together.
I’ve had a discussion here in Western Australia, where I’ve been for the past few days, with Premier Barnett and he’s open to working together.
Premier Baillieu today obviously is in a big mess on education with a crisis on his hands that he needs to resolve with a teaching service which he promised he would make the highest paid in Australia.
I’ll have to let Premier Baillieu sort out that mess but at the appropriate point I will sit down with Premier Baillieu too and I hope I hear the same kind of response that I’ve heard from Barry O’Farrell and Colin Barnett.
And then, of course, I’ll speak to all of the other premiers and chief ministers around the country and we will get on to working for the conversations we need to have to drive shared change.
HOST: All right. For all the announcements you’ve made and you’ve, several times in the last few days, refused to say how you’re going to pay for all of these things, the National Disability Insurance Scheme, the education spending, all these different policies you’ve announced, the dental plan and all the rest. Are you going to flog the NBN?
PM: The National Broadband Network’s going to roll out exactly as we’ve announced it Jon, so don’t try and start some silly campaign about what’s going to happen with the NBN.
HOST: Well I’m trying to work out what other bits and things you could flog off to pay for all of this and that’s the one that comes to mind.
PM: Look, how we’re going to organise future budgets, once again, look at what we’ve achieved to date: $100 billion of savings, some of them very controversial indeed.
HOST: Will you rule out flogging off the National Broadband Network?
PM: I wasn’t getting too many people applauding when I was on radio shows like this one talking about means testing the private health insurance rebate, talking about getting rid of benefits like the dependent spouse tax offset, people weren’t applauding in the streets.
It’s tough decisions, the right decisions to make money available for what are higher priority areas for our nation’s future.
That’s how we’ve acted to date, that’s how we mean to go on.
HOST: Will you rule out flogging off the National Broadband Network to pay for all of these?
PM: Jon, the settings we announced at the time of the National Broadband Network announcements are nothing to do with anything announced about schools in the last few days, was that it would be publicly owned, there would be a roll-out.
Sometime in the future there would be a looking at moving to a different ownership arrangement, we said that a few years ago, nothing’s changed about that and nothing is going to change about that because of anything I’ve announced about school education.
Don’t try and put the two together, they’re not connected.
HOST: I was trying hard. I thought I was getting somewhere. There’s an ugly industrial dispute that’s paralysing parts of the centre of the Melbourne CBD, Prime Minister. Grocon and the CFMEU are at loggerheads and each side, according to today’s press, are calling in some muscle.
There’s a photo in one of the papers of some Grocon executives meeting with a Hells Angels bikie. Mick Gatto told us the other day what support he was providing to the CFMEU and in fact he suggested that John Setka would be a good Prime Minister.
I don’t know whether that’s something that’s crossed your mind as well but overall, surely all of this is why you need a strong watchdog for the construction sector and why you shouldn’t have disbanded the ABCC.
PM: We do have a strong watchdog in the construction sector.
HOST: Not strong enough obviously.
PM: Well, Jon, let’s go through it once again. We do have a strong watchdog in the construction sector and it is there policing industrial law.
What is happening in the streets of Melbourne is grossly unacceptable. It’s breaches of state law. It’s illegal actions and picketing and everybody should take a step back and get this dispute resolved.
PM: There’s no excuse ever for unlawful conduct and no-one should be engaging in that conduct. At the end of the day industrial disputes are resolved by people being prepared to sit round a table and get them resolved and be willing to take a step back from the brink.
HOST: Bill Shorten tried that, Prime Minister, and it didn’t work. It didn’t work.
PM: Everybody should take a step back from the brink. Everybody should calm down, settle down and get this fixed.
HOST: Well saying that doesn’t achieve anything. Bill Shorten tried exactly that approach last week. It’s not worked, so what do you do next?
PM: This is a dispute, an industrial dispute that needs to be resolved between the parties. They need to engage in a process that will get them there and do that.
HOST: No, they’re entrenched in their positions-
PM: And of course the President of Fair Work Australia is available to help.
HOST: And it’s not working.
PM: On unlawful conduct, including blocking streets and that kind of conduct, that kind of conduct is unacceptable and shouldn’t be pursued.
HOST: Any number of other topics that are occupying your mind at the moment. Is it a politically wise move to pick a fight with the tobacco industry, the pokies lobby, the mining industry and the Murdoch media empire all simultaneously?
PM: What I do as Prime Minister, Jon, is the important things that will set us up for the future.
So I’m prepared to have a fight about improving Australia’s schools and I’m going to be very, very persistent in that fight.
I’m prepared to have a fight about creating a National Disability Insurance Scheme.
I’m prepared to bring all of my efforts, along with my very strong economic team – Wayne Swan, Penny Wong, Craig Emerson – the strong economic team that I have to ensure that we continue to give people the benefits of jobs and a strong and growing economy.
That’s what I’m focussed on as Prime Minister.
HOST: Are you aware that the file about your activities at Slater and Gordon is still being hawked around? That former solicitor, Barry Nowicki, is still hawking around stories about your activities 17 years ago at Slater and Gordon and trying to rekindle interest in some of that material?
PM: I didn’t specifically know that Jon, but I’m not surprised. I said on the day that I dealt with all of this in a record-length press conference that there would be various nut-jobs, was the term I used, various nut-jobs out there still pursuing this and it wouldn’t matter what I said or what I did or what the truth was, they don’t care.
It’s a bit like you see overseas, people who pursue the discussion that President Obama wasn’t born in the United States of America.
I mean there’s people on the fringes of politics that deal with ridiculous things and unfortunately that’s a feature of modern political life.
HOST: Well whether or not there’s still something in it, we shall wait to see. Thank you for your time this morning.
PM: Well, Jon, if you, I’m not going to leave that unchallenged Jon. I gave a record press conference on this. I answered every question put to me. You haven’t got a question to put to me.
HOST: No, no, on the contrary.
PM: I’m not going to leave your listeners with the impression that there’s something here because someone on the margins of political life is hawking around nonsense.
If you were interviewing President Obama right now you wouldn’t end that interview by saying about the ridiculous allegation that he wasn’t born in the United States that maybe something else will come out about it in the future.
This stuff is all rubbish, I’ve dealt with it, it’s over, it’s done. Just because there are some idiots out there who will always pursue it no matter what the truth is doesn’t mean that people like you or any person of reason should be following them down that path.
HOST: Quite to the contrary, I’ve stuck my neck out consistently right from the beginning saying it’s a stack of cards that’s built on the thinnest of foundations and I can’t see the substance in it. In fact I’ve been consistently saying that from the beginning, that the mere fact that people are still going is astonishing.
Prime Minister, thank you, I understand our time is up and look forward to seeing you one day in the studio here.
PM: Thanks Jon.