TRANSCRIPT

THE HON PETER COSTELLO MP

TREASURER

Interview with Philip Clark

2GB

Wednesday, 6 October 2004

4.15pm

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.