TRANSCRIPT
THE HON PETER COSTELLO MP
Treasurer

Doorstop Interview
Mural Hall

Parliament House, Canberra

Wednesday, 20 August 2003
11.25 am

SUBJECTS: Defence, Wilson Tuckey, COAG

JOURNALIST:

If the defence capability plan is, as you say, deliverable, contrary

to what this report says, and if there is as we hear now, a $12 billion

gap between the estimate originally given and the current figure, how

will you deliver it without increasing defence spending substantially?

TREASURER:

The important thing with defence capability is to set down the capability

which you believe is required to meet our strategic needs and our strategic

doctrines. As I said earlier, that will change from time to time. It

has already changed. When we were setting down the kind of capability

that we thought Australia would want back in the late 1990s, it was a

pre-Timor, pre-Iraq, pre-Afghanistan, pre-Solomon Islands world. And

our capabilities have to adjust and the Government will ensure that we

will have a capability which meets our strategic needs and our strategic

doctrines, and we will ensure that that is delivered within budget requirements.

And I make this point, that defence expenditure has gone up in this country

very substantially. The Budget this year is about 25 percent higher than

it was thought that it would be five years ago. We have delivered on

that. We have allocated the money down through the forward estimates

for the White Paper. What we have to make sure, is, that as we deliver

these items, we deliver them to the capability which is required.

JOURNALIST:

In the context of that changing security environment, is the, are the

subs still useful or are they a white elephant in a sense? Are they not

suitable to the current challenges that you are facing?

TREASURER:

When we entered the Collins Class Submarine contract, we did say because

in the pre-war on terror, pre-Iraq, pre-Afghanistan, pre-Solomon islands,

pre-East Timor world, Australian defence doctrine was to protect the

maritime approaches against a land invasion. And that was a decision

that was entered into in the mid to early 1980s. The lead times are so

great, we are still going through full-cycle docking now. Now the reality

is, we have the Collins Class Submarines, they work. They have taken

a lot of rectification and a lot of money, but there is no point in having

submarines if they are not fully capable. And having the submarines will

ensure that they are fully capable. It proved to be an expensive decision.

JOURNALIST:

The overnight bombing, Treasurer, does that mean that there are still

geo-political risks for the global economy?

TREASURER:

Well, first let me say the bombing in Iraq is a terrible blow, of course,

to the UN, to the effort to re-build Iraq and to the families of those

people who have been killed. And Mr de Mello was a good friend of Australia

and our heart goes out to him and his family. What it tells you, is,

that Iraq is still a very dangerous place and the re-building of Iraq

is going to be a long and arduous process, but the international community

can’t walk away. The re-building of Iraq is important, not just for the

Iraqis, but it is important for stability in the Middle East.

JOURNALIST:

Should Mr Tuckey resign over using ministerial letterhead to ask South

Australian police to drop charges against his son?

TREASURER:

Well, Mr Tuckey has made a statement to the House of Representatives

this morning. He has apologised for any misleading comment that he might

have made in the Parliament yesterday, and he has indicated that as he

looks back on it, that perhaps he should have handled it in a different

way…

JOURNALIST:

How important…

TREASURER:

…and you know, what else can you ask? I don’t believe that Mr Tuckey

was trying to get some personal advantage, I think knowing Mr Tuckey

as I do, he probably felt the situation was wrong and he’d take the opportunity

to point it out to somebody…

JOURNALIST:

But…

TREASURER:

…and if I may say this, pointing it out to a Labor Minister in a South

Australian Government, it was very unlikely that the Labor Minister was

going to come under the influence of Wilson Tuckey.

JOURNALIST:

Mr Costello, how can you (inaudible) personal advantage, he asked that

a fine be reconsidered on behalf of a family member, how appropriate

is that for a Minister to use Ministerial Letterhead to do that on behalf

of a family member?

TREASURER:

And what happened? He was told no…

JOURNALIST:

But…

TREASURER:

…so what…

JOURNALIST:

…how appropriate is it to ask…

TREASURER:

…well as I said, no advantage was obtained, and I think if you sit

back and look at it, would anyone have expected a Labor Minister to have

given advantage? Now you say, how wise was it to write the letter, well

it wasn’t effective, and I think that if Mr Tuckey had his way again,

he wouldn’t do it.

JOURNALIST:

Would you do it? On behalf of a member of your family?

TREASURER:

Well fortunately my 16 year old son is not a truck driver.

JOURNALIST:

(Inaudible) breached the code of ministerial conduct though, Treasurer,

did he breach the code?

TREASURER:

Well look, Mr Tuckey has, he has gone back into the House, he has apologised

to the House, he has clarified the record. If you ask my view, I think

he probably, looking back on hindsight wouldn’t do it again, and if he

hadn’t have done it, this wouldn’t have arisen. Did he get any advantage

from it? No. You know, when you think about it, writing a letter to a

State Labor Minister is unlikely to influence the Labor Minister, it

is much more likely the State Labor Minister will do what he probably

did in this case, ie, give it to the Federal Opposition…

JOURNALIST:

So was he right to do it?

TREASURER:

…and create trouble for you.

JOURNALIST:

So is it alright to do it Mr Costello, the difference is whether you

get away with it or not?

TREASURER:

No I didn’t say that.

JOURNALIST:

Mr Costello…

JOURNALIST:

Are you saying it is alright to do it?

TREASURER:

No I didn’t say that. I said as he looks back on it, he probably regrets

it, and believes he shouldn’t have done it. That is precisely what I

said.

JOURNALIST:

Is it alright for a Minister to do that?

TREASURER:

As I said, as he looks back on it, he believes he shouldn’t have done

it, and wishes he hadn’t.

JOURNALIST:

Mr Costello you have recently given a series of speeches about social

capital and the importance of trust in society including between voters

and the public.

Why should the voters trust the Howard Government and place trust in

their Ministerial Code of Conduct if it is seemingly continually broken

but that doesn’t seem to matter?

TREASURER:

Well, you say that the Code of Conduct is broken. I haven’t seen the

particular clause that you say is broken. Now, you ask me this question

about Wilson Tuckey, should he have done it? He looks back on it, and

he realises he shouldn’t have. OK. Do I think it is wise for Ministers

to do that? No I don’t.

JOURNALIST:

How important is it for the economy next week…

JOURNALIST:

Just back to the defence…

TREASURER:

Yep.

JOURNALIST:

…has the Government yet identified anything in the current defence

capability plan that it can adjust out of it to get the thing into a

financially manageable state, are there any specific elements of that

DCP that you can see that can now be taken out of it?

TREASURER:

Well, look when you do a capability, you say to yourself, what do we

think we have to be capable of doing to meet our legitimate defence of

Australia, and our strategic interests? Now that is not immutable. You

don’t say everything that was there stays and we just keep on adding.

What you do, is, you say, in a particular environment, as we know understand

it, with the calls that we are likely to have, what do we need to be

capable of? We said this when we brought down the White Paper. It is

not immutable…

JOURNALIST:

So what is mutable now?

TREASURER:

…and that is why we have a review, and we go through those things and

we take strategic advice and it comes back and the Government makes a

decision. Now I am not going to stand here and announce that, the outcome

of that review today, because it is not being done by me. It is being

done by Defence, it will come to the National Security Committee, and

it will go to the Cabinet. But this idea that everything that was, stays,

regardless of whether or not the capability as we now understand it,

requires it, and we just add on, would not be a proper, would not be

a proper prioritisation of what we need in defence. Now let me make the

point, and I have made this before. There has been no shortage of money

allocated by this Government to Defence.

You heard what I said – an extra $38 billion, a Budget this year, 25

percent above what we were expecting some years ago. What we have got

to make sure is, that money is applied to the defence capabilities which

we require as we now understand them. That is my message.

JOURNALIST:

So would you be relaxed about the F-111’s retiring early?

TREASURER:

Well, again, this is a matter which is going to be considered by the

Defence Department and will be brought to the National Security Committee.

I am not going to pre-empt what they say, I have read in newspapers that

there are some people that want to make a recommendation in relation

to

F-111’s, I want to hear the argument. I haven’t received it yet. But

it will come, and I am sure that it will be a very, very strong argument.

JOURNALIST:

Treasurer, how important is it next week…

TREASURER:

Last question.

JOURNALIST:

…that the COAG to come up with a set-water resolution?

TREASURER:

Very important. Absolutely important. Thanks.