Press Conference

Treasury Place, Melbourne

Wednesday, 27 July 2005

12.00 noon

SUBJECTS: June Quarter Consumer Price Index, Industrial Relations, Bob Carr

TREASURER:

Today’s Consumer Price Index is good news for the Australian economy.

What it shows is that inflation is low and it is stable. The Consumer Price

Index rose 0.6 per cent in the June quarter or 2.5 per cent through the year

which is right in the middle of the Government’s target of 2 – 3

per cent. A very large part of that rise however was world oil prices which

meant that the cost of transportation – fuel – essentially rose

7.2 per cent in the June quarter. If you extract that, because that is a factor

which is principally determined by overseas events, if you extract from that

the consumer price index only increased 2.1 per cent through the year which

is very low indeed.

Prices fell across a range of items. Fruit prices came down significantly,

domestic holiday travel came down, electricity, audio and computing media came

down. Those areas that contributed to price rises included housing, health and

clothing and footwear. When you add all of those together this is very good

news for the Australian economy – low inflation, stable inflation. With the

significant price increases unfortunately, petrol prices coming from overseas,

in fact, in Australian dollar terms, world oil prices went up around 7.7 per

cent in the quarter and federal prices went up 7.2 per cent. So you can see

they track world oil prices very, very closely indeed.

If we can keep inflation low then we can keep interest rates low and then we

can keep the economy growing and unemployment which is now at 30 year lows can

continue to grow in Australia.

JOURNALIST:

It is nothing on inflation; can I ask you about the workplace relations debate

please, Treasurer?

TREASURER:

Sure.

JOURNALIST:

In the interview that you gave to the Australian Business Limited publication,

is the Government still looking at that idea of, is it still a possibility to

totally remove the exemption on unfair dismissal claims?

TREASURER:

No, the Government is not looking at it.

JOURNALIST:

So it is just not on, because you gave that interview a little while ago I

understand.

TREASURER:

No, no, what I said is you know, if at some point in the future you had a situation

where you had more jobs and higher wages and everybody was happy and wanted

to do another round of reform of course you would deal with that in the future,

but that is not what the Government is proposing, no.

JOURNALIST:

But it is still a possibility at some stage in future years though from what

you say?

TREASURER:

Well, you’ve seen what I’ve said.

JOURNALIST:

What about the issues of public holidays and meal breaks, can you guarantee

that workers won’t be force to sign those away?

TREASURER:

Well, no worker will be force to sign any agreement but you have got to have

the right if workers want for example, higher wages, if they preferred to leave

earlier you have got to have the right to do that, if they want to do that,

but if they don’t want to do it they won’t agree to it and they

can’t be forced to sign agreements.

JOURNALIST:

Are meal breaks not a workplace health and safety issue?

TREASURER:

Well they might be, yes, and if they were then of course nobody in their right

mind would take them away.

JOURNALIST:

What about issues like public holidays, like Christmas Day and Good Friday?

Should workers be able to have those days off as traditionally they have been?

TREASURER:

Of course, but there are a lot of people who work today on weekends and public

holidays. They work those days because they get higher wages for doing so. You

don’t want to take away that right, you wouldn’t ban people from

doing it, of course not, because people do it at the moment but neither would

you force them to do it.

JOURNALIST:

The ordinary spread of hours (inaudible) 38 hours over 7 days rather than 5

days penalty rates (inaudible) they won’t necessarily be getting higher

wages for those extra days?

TREASURER:

I don’t think anybody would want to work longer hours if they didn’t

get paid more and nobody will and you know, there are a lot of people today

who say well look, rather than have a morning smoko and an afternoon smoko and

extend my working day from 8 am to 6 pm, I would rather do without smoko’s

and get to go home at 5 pm rather than 6 pm and you wouldn’t want to ban

that and you would have given the opportunity to set hours which are flexible

and under an industrial relations system where people have flexibility they

will continue to have that – as they do at the moment, I should say.

JOURNALIST:

These things are up for individual negotiation in the case of an AWA between

the employer and the employee, whether or not they get extra money for example

trading away their penalty rates.

TREASURER:

Well no, this happens at the moment. Under current wage negotiations to engage

in productivity reforms and set hours. This happens at the moment, there is

nothing unusual about this. Would you ban it? No. Why would you ban it? If people

want to do it they should be free to do it, to set hours that suit them. You

wouldn’t want to ban it but if people don’t want to change their

hours or if they want to preserve rates and if they want to preserve smoko’s,

they should be free to do that too.

JOURNALIST:

Treasurer do you have any reaction to Bob Carr’s resignation today?

TREASURER:

Well Bob Carr has been a very substantive political figure in Australia for

over a decade. He is the Premier of the largest State, he is somebody who has

won several elections and been very successful in doing so. He has decided to

go at a time of his own choosing. I heard him set out some of his achievements

which he looks back at and is proudest of and I wish him well in retirement.

He has undoubtedly headed the largest State over a long period of time and made

a major contribution to Australian political life. I haven’t agreed with

everything that he has done obviously, but you have got to pay tribute where

tribute is due. He has had a long and successful career.

JOURNALIST:

Is this very rare for a leader to go of their own choosing?

TREASURER:

Very rare indeed.

JOURNALIST:

Does his departure sort of, do you think I will prompt any thoughts that it

might be time for a changing of the guard at the top of the Federal Government

do you think?

TREASURER:

I am not going there.

JOURNALIST:

Not going there.

JOURNALIST:

Do you commend him though for choosing to go at a time of his own?

TREASURER:

I pay tribute to a very significant political figure who has been Premier in

the largest State over a period of 10 years. I think he has won three elections,

maybe four, and has a number of achievements to show for his term in office.

I don’t agree with everything that he has done and I think there are some

areas where New South Wales would want to lift its performance. Having said

that, you have got to pay tribute to a man who is as successful as he has been

and has made this decision. I think today is a day to dwell on the achievements

rather than to dwell on the shortcomings.

JOURNALIST:

Would you like to see him in the Federal Parliament?

TREASURER:

If he wants to run for federal politics he is entitled to do so.

JOURNALIST:

Do you think he would be an asset to the Federal Labor Party?

TREASURER:

Well if anyone wants to go into the Federal Parliament they are entitled to

do so. All they have got to do is nominate and get themselves elected.

JOURNALIST:

Do you think it is likely?

TREASURER:

You would have to ask him, I am no expert on Mr Carr and his intentions.

JOURNALIST:

In the interview with Australian Business Limited, you were pretty withering

about Mr Carr. You said he deserved to get the boot, he has been a very poor

manager of the New South Wales economy, you were pretty pointed about that in

that piece. I mean, do you still stand by those views?

TREASURER:

Yes, but you know, the man has just announced his retirement for heavens sake

after 10 years in politics so today is not the day as I said to dwell on his

shortcomings. He has chosen to retire, he is entitled to go with good grace

and I wish him all the best.

JOURNALIST:

Who would be a more formidable opponent, Kim Beazley or Bob Carr?

TREASURER:

Well look, I think you are making a big supposition here, I think you are making

a big supposition as to what Mr Carr’s intentions are. If anyone wants

to go into Federal politics they are entitled to do so but it is a long road.

You have got to get elected and you have got to get experience and if you wanted

to be the Leader of the Labor Party you have got to get the support of a very

disparate group of people and I think that is all well off in to the future.

JOURNALIST:

It does stir the pot federally though, doesn’t it?

TREASURER:

I won’t go there. Thanks very much for your time.