Interview with David & Kim

9 am, Channel 10

Thursday, 28 June 2007

9.10 am

SUBJECTS: Census, population, petrol

KIM:

Good morning.

TREASURER:

Good morning, David, Kim. 

KIM:

What actually is a Census and why do we need it?  I mean, a lot of people who fill out these questions wonder what it is all about.

TREASURER:

It is the largest peacetime undertaking that we do in Australia.  Every five years we try and…

KIM:

Really?

TREASURER:

…Yes, we try and knock on every single door in the country.  And we try and find out who lives there, how much they earn, how many children they have, what their professional qualifications are.  A Census is as old as the time of Christ because you can remember that Jesus went to Bethlehem for a Census.  So it has been going on for thousands of years.  We do it every five years here in Australia and it gives a snapshot of the nation. 

DAVID:

Just because you brought up the topic of Christ, are you surprised that we are so Godless – 3.7 million people, no stated religion, it’s increased (inaudible) almost one in five citizens have no stated religion. 

KIM:

And of course then there is the Jedi, the Jedi Warriors who, that probably counts as Godless.

TREASURER:

Is that right?

KIM:

Yes.

TREASURER:

Was that you David, are you…

DAVID:

No, no.

KIM:

There are quite a few Jedis about…

TREASURER:

I think he might be in deep cover here.

DAVID:

No, I am a deeply religious man.  But does that surprise you?

TREASURER:

No, it doesn’t because I think in previous Censuses people probably were reporting their religious affiliation whereas it may have actually slipped in practice.  And I think now people are more forthright about not having a religious affiliation.  We actually have a question there which allows you to state that you don’t have any religion.  And what you are seeing is that the mainstream, the big churches, tending to trend downwards, some of the new churches are tending to trend upwards, like the Pentecostal churches – showed incredible growth in this last Census.

KIM:

Buddhism is up too.

TREASURER:

Buddhism is up, Islam, some of the other religions, particularly with migrants coming into the country, are growing.

DAVID:

There is a terrific cartoon in the paper this morning by Mark Knight, which should inspire our next topic of conversation but let’s have a look at that. 

KIM:

‘Eau de Costello.’

DAVID:

That is beautiful, isn’t it?  They’ve really, they spotted you as the inspiration for the increase in population. 

TREASURER:

I think enough to inspire every woman in Australia, that perfume there. 

DAVID:

Someone will come up with that (inaudible).

KIM:

You must sleep well at night knowing that you have encouraged you know, a great population boom because as I understand it, we are now, babies are born every two minutes and people are dying every four minutes, so…

TREASURER:

Yes, we are in the middle of a baby boom.  In 2006, the year of the Census, we had the second highest number of babies born ever in Australia. 

KIM:

You realise we are actually talking about sex now, aren’t you?

TREASURER:

No, babies are different to sex. 

DAVID:

You can’t have one without the other. 

TREASURER:

Oh no, yes.  Let’s not go there.  But the good thing is that the population is picking up and that is good for this reason: that with the ageing of the population, a larger proportion of older people compared to people who are younger.  We were running the risk that we wouldn’t have enough people to look after all of the old.  We wouldn’t have enough people in the workforce to manage all of the services and if we can boost that birth rate that is going to be good for the long-term future of Australia. 

DAVID:

Is there an ideal population do you think, for Australia?

TREASURER:

Well the fertility rate that I would like to see is 2.1 at least. 

DAVID:

Right, is it about 1.8 or 1.9…

TREASURER:

It is about 1.8.  2.1 is replacement, and that is why I said, one for the Mum, one for Dad and one for the country because if you have the one for the country you are making up for the others that may not get married and may not have children.  So 2.1, we are still below replacement level so we have still got a bit of a way to go.

KIM:

Lots of interesting things have been revealed and one that I found particularly interesting was that the nuclear family is no longer the majority. 

TREASURER:

Yes.

JOURNALIST:

That is pretty significant. 

TREASURER:

Yes, well for the first time since 1911 it is only a minority of the population that has married.  Since 1911 a majority of the population has been married, that is no longer the case.  And there has actually been quite a rise in people who have never married and of course a rise in divorce.  You might ask yourself what happened before 1911 as I did, and we were mainly a colonial society with more men than women, but it is very interesting that marriage is no longer the norm, statistical norm, in Australia. 

DAVID:

The number of childless couples is up as well.

TREASURER:

Yes.  And this is a very funny thing.  We are living in smaller and smaller family units, but living in bigger and bigger houses.  And so although you are not having families of four, five, six and so on, you are having smaller families but the average home is a four bedroom home, so whether there is a spare bedroom or a study or a workroom or whatever it is, we have got higher incomes, smaller families and bigger houses. 

KIM:

And more room. 

DAVID:

And the bigger houses are less affordable.  I mean, that must be the concern, if there is a concern that comes out of the Census, it is that, housing affordability, isn’t it?

TREASURER:

Yes well, people are buying bigger houses and of course they are paying more for them.  And as a result of that people are investing more in their homes.  I think it is probably a considered financial decision for many people and they think it is going to be a good investment over the course of their lives that they do it.  In fact, one of the interesting things you will find in the financial figures is the people who borrow the most tend to be the highest income earners.  That is a very interesting statistic. 

KIM:

It is interesting.  And also, further to that, with a third of people only being able to afford their homes, are we running the risk that it is the rich people who own their homes and then two-thirds of the population will never have the ‘Great Australian Dream’?

TREASURER:

Yes it is interesting this, a third of Australians have paid off their mortgage and own their home outright, a third are paying a mortgage and a third are not buying a home.  So you have got a really precise difference between those three categories of people.  But by world standards home ownership is still very high in Australia and when you look at these figures you can see that most families, I think nine out of ten families, live in detached homes with children.

DAVID:

Are there viable options to increase housing affordability?  Do you think this is important?

TREASURER:

Yes, I do, I do, I do.  There is strong demand at the moment, strong demand.  The population is growing, people have got work there, they have got money to pay mortgages.  I think what we have got to do is boost the supply side.  We have got to make more homes available, more land released in order to meet that very strong demand.  I think that is the best thing you can do.

DAVID:

But whose responsibility is that?  It is the States, is it?

TREASURER:

States, councils, I think all working together to release more land.  You see, we haven’t actually got a housing affordability problem.  The cost of constructing a house has not gone up much at all in real terms.  It is a land affordability problem.  What is driving prices?  Not housing costs.  It is land.  And I think the release of more land, I think reduction of some of the taxes on land release, I think that would be very positive measure. 

KIM:

Let’s talk about families again.  I was interested to read the figures on families because it is a push that we have had on this show and we are not the only show who is pushing for paid maternity leave, but does it damage the case to push for paid maternity leave when we are seeing less families in that nuclear family situation?  I mean, should we be looking at other options aside from paid maternity leave?  Or is paid maternity leave still on the agenda?

TREASURER:

Look, I think there is a myriad of reasons that influence people in starting a family.  I think economic security is a big part of it.  If you are not confident about your prospects, your work, your job, obviously you are not confident about starting a family.  I think childcare comes into it, the Baby Bonus I think has helped…

KIM:

The plasma bonus.

TREASURER:

…there is the family payments…

DAVID:

(inaudible). 

TREASURER:

…there is family payments, I think there are a whole myriad of reasons that go into that.  And it is also certainty of relationships too.  I think a lot of women in particular are not too certain about how committed their partners are and they are right to be concerned about that before they embark on having a child.  As you know, a child is with you for a very long time. 

DAVID:

And it keeps getting longer.

TREASURER:

And getting longer.

KIM:

Exactly, you can’t get rid of them.

DAVID:

Would the Government look at a paid maternity leave scheme?  I mean, Government employees, I think the Government figures are 39 per cent of Government employees have some kind of paid maternity leave.

TREASURER:

Well certainly we encourage employers who wish to do so, to do it.  And certainly the Government itself does it.  If you are asking another question, should you pass a law and make every employer do it?  Well, we think for many small businesses in particular that would be a real problem. 

KIM:

But should the Federal Government not be funding it?

TREASURER:

So, well this is why we introduced the Baby Bonus.  The Baby Bonus was introduced to cover mothers who go out of the workforce for a period of time to have children and it is paid in a lump sum and that goes to compensate amongst other things, for loss of earnings.

KIM:

There is also the issue of course when women get out of the workforce.  The statistics show that men are still earning more then women and with a breakdown of families, that is a concern as well because you have got mothers then going back into the workforce with primary care of kids, and not earning as much money.

TREASURER:

Yes, the interesting thing is though, that a lot of the growth in employment in Australia has actually come from women.  The number of women in the workforce has been growing much faster than the number of men.  Now…

KIM:

What age though?

TREASURER:

Well all ages, all ages really including women of child bearing years.  It is quite common now as you know, to have a child, maybe come back to work for two or three days.  Now, when you then look at women’s wages and you average them all up, you have quite often got a large component in women’s wages of actually part-time workers, they might be working two or three days, whereas men it is mostly five days. 

KIM:

So you are saying it is bringing the average down.

TREASURER:

So it affects the averages, quite right.  And that is why when you look at these overall statistics you have got to actually allow for some of these things.

DAVID:

How have your super reforms helped?  I mean with the ageing of the population, we know that a lot of people have just gone and started piling the money in, has is helped, has it hit the mark?

TREASURER:

Well it starts on the first of July from, is that Sunday, I think…

DAVID:

Yes, so you have got to find that million dollars…

TREASURER:

No you don’t have to, I just, this is, there is a lot of misunderstanding of this…

KIM:

Oh, so you are here to give us all a million dollars?

TREASURER:

If you would like it.  You know, people say, ‘I have got to find a million dollars before the 30th of June.’  No, no, no, you can put a million before the 30th of June but you can put in $150,000 a year or $450,000 over three years.  So you don’t have to put it all in before the first of July.  If you have got a lazy $150,000 sitting around, you can put it in afterwards.  The idea is that you can put sums into superannuation, and when you are over 60, you will be able to take your money out without any tax on the pension or the lump sum. 

DAVID:

How secure is that money?

TREASURER:

Well, it has got to be secured by trustees of superannuation funds and hopefully – a lot of people say to me, how do we know some government down in the future won’t legislate to put those taxes back on – well hopefully no government will ever try and attack these reforms in the years to come.  I will be around looking over their shoulder to make sure they don’t. 

KIM:

So when you are the Prime Minister you will be guaranteeing people that…

TREASURER:

Oh absolutely, I mean I introduced these reforms, I will be making sure whoever is in office that people in Australia will be protected.  I hope so. 

DAVID:

Let’s move onto petrol.  You have called for a petrol inquiry, what can you do?  What can that effectively do?

TREASURER:

Look, you hear from time to time, people say, oh there is a cartel operating and they are all agreeing amongst themselves to put up prices. 

DAVID:

Colluding. 

TREASURER:

Colluding.  If you call an inquiry, you can call these people into the witness box and cross-examine them.  You can call in by the way, the people who it is alleged are operating the cartel.  By the same token you can call in the motoring groups who reckon they have got evidence of these cartels into the witness box and cross-examine them to try and get at the evidence that they have got.  And if you get this evidence and remember it is in a witness box, there will be lawyers cross-examining them, then if there is a cartel, and you know, let’s not pre-judge any evidence, but if there is then you can start prosecuting them.  So it is a step to getting to the evidence. 

KIM:

Should jail terms be introduced?

TREASURER:

We have said we will…

KIM:

For those found guilty?

TREASURER:

We have said that we will introduce jail terms for executives who engage in hard-core cartel activity.  Let me make this clear.  Cartels are illegal at the moment.  The only problem at the moment is evidence.  So, it is quite illegal at the moment.  We have said we will be increasing the penalties but the problem at the moment is not the penalty.  The problem at the moment is the evidence.  And having this inquiry will give the motoring groups you know, like the NRMA, RACV, the chance to get into the witness box too and give their evidence – if they have such – of where they believe the cartel activity is operating. 

KIM:

Because certainly anecdotally, everyone complains that the prices go up for a long weekend. 

DAVID:

It certainly looks like it. 

KIM:

It looks like it, doesn’t it?

TREASURER:

Well, a lot of work has been done on this and the prices do go up on a Thursday and Friday every week.  There is…

KIM:

How about that.

TREASURER:

…if you want to buy petrol, but it on a Wednesday because all of the evidence shows petrol is cheaper on a Wednesday than practically any other day of the week. 

KIM:

I was going to say, but that surge, you know, the tidal effect that we experience in capital cities, doesn’t affect people in the country or regional areas as much.

TREASURER:

Yes, you have got different things operating in different markets.  So one of the things that happens is they go into a discounting round as against each other and then they call it off on a Thursday.  That is generally why the price goes up.  But what concerned us recently was the difference that opened up between the Singapore price and the Australian price.  Now, there is a reason for this.  A lot of petrol is refined in Singapore and comes down as a refined product.  So, if the Australian market is competitive you would expect the market to be closely following the price of refined petrol in Singapore.  It is one of the globe’s big refining areas.  We noticed that a margin opened up between the Singapore price and the Australian price and the ACCC said that tells us something fishy went on and that is why we called this inquiry.

DAVID:

We are out of time.  Just before we go, I know Parliament is taking, in recess at the moment, so what will you be doing with your time off?  Will you be looking for a job or will you (inaudible)?

TREASURER:

Oh, entertaining people on TV and meeting kind TV hosts. 

KIM:

Is that what we are?  Oh damn. 

DAVID:

I think the population has just ticked over to 20,0998,0760.

TREASURER:

The big day is tomorrow, we get 21 million, our country comes of age.  And it will be a great celebration.  

KIM:

Do you have a special gift planned for the lucky baby?

TREASURER:

We are trying to find that baby, actually.

DAVID:

It is an election year, you will go and give it a smooch.

TREASURER:

Yes, something like that.  And a Baby Bonus. 

DAVID:

Peter, thank you very much for your time this morning.

TREASURER:

Thanks very much.

KIM:

Thanks for joining us.

TREASURER:

Thank you