TRANSCRIPT
THE HON PETER COSTELLO MP
Treasurer

Doorstop Interview

Treasury Place, Melbourne

Tuesday, 27 July 2004
12.45 pm

SUBJECTS: Liverpool Council, Latham, Free Trade Agreements, gambling

TREASURER:

We have now got the independent report on the Liverpool Council which was done by Professor Daly and it confirms that the Liverpool Council under Mark Latham as Mayor, had a deficit in working capital, a debt servicing ratio of around 12 per cent and had audited deficits. Now, this is a big problem for Mr Latham because it shows that his financial record in the Liverpool Council – probably the most mismanaged council in Australia – was a deplorable record. And it also shows that attempts by him in Parliament to try and claim that he left the Council in a surplus were wrong. The independent report shows he left it in a deficit with a deficit of working capital. Now, if Mr Latham wants to come clean on the Liverpool Council, he has got to now come out and reconcile his claims in the Parliament to the findings of the independent professor. And if he can’t do that, then he has got to apologise because the information that he has been giving out, has been wrong. He can’t cover up his record. His period as Mayor of the Liverpool Council, as found by the independent report, led to deficit, the shortage in working capital and a debt servicing ratio of around 12 per cent. This Council eventually ended up in financial administration and I keep on saying, if you can’t run a council, you can’t run a country, and Mr Latham has a lot of explaining to do.

JOURNALIST:

(inaudible) the figures (inaudible)?

TREASURER:

Well, you had an independent inquiry, a huge report from a professor. Now, why did the professor do this report? This Council is now under financial administration, it has been run so badly, it is now in financial administration. The State Government appoints an independent professor to do a report as to how did this Council get into such financial stress and the professor finds that during the period 1991 to 1994, when its then Mayor was Mark Latham, it had a working capital deficit, a debt servicing ratio of 12 per cent and he left the Council in deficit according to the audited accounts. This is the only administrative job that Mr Latham has ever held in his life, and he left the Council in a state of financial disrepair and on the basis of that he now wants to be Prime Minister. If he can’t govern a council, he can’t govern a country.

JOURNALIST:

On another issue, do you think there is a split in Labor ranks on the free trade agreement?

TREASURER:

Well, obviously there is a split in Labor ranks on the free trade agreement. We have had Doug Cameron come out and oppose the free trade agreement. We have had Senator Kate Lundy come out and oppose the free trade agreement. We have got Senator Cook who apparently supports it. And we have got Mark Latham who can’t decide. So, we have got some yes’s and some no’s and some don’t know’s. But what we would say to the Labor Party is this is an important trade issue, this is a great chance, or a once in a generation chance, for Australia to get better access to the world’s largest economy. It doesn’t take any more inquiries, what it takes is a bit of leadership to support.

JOURNALIST:

What do you think the disarray on the issue spells?

TREASURER:

Well, obviously there are some people in the Labor Party who are economically responsible and who want to sign the free trade agreement. There are some people in the Labor Party who are influenced by anti-Americanism, and don’t want to. Labor is as divided on this as it is on a whole lot of issues concerned with the United States and the American Alliance but I would say that it is important that Labor think of our economic future, because our economic future will be enhanced if we get access to the world’s largest economy.

JOURNALIST:

What would the free trade agreement with Malaysia deliver to Australia?

TREASURER:

Well, if we could get an opening of trade to Malaysia we should pursue that as well. Wherever we can get markets all around the world, whether it be in the United States, whether it be Thailand where we have just signed a free trade agreement, if we could get one with Malaysia, we ought to pursue it because by opening markets for Australian exporters we will strengthen the Australian economy.

JOURNALIST:

Do you think that will open up south-east Asian markets more generally for Australia?

TREASURER:

Well, we have got a free trade agreement with Singapore and we have got a free trade agreement with Thailand, so that if you were to get a free trade agreement with Malaysia, it is a long way off obviously, you would have a large part of ASEAN covered.

JOURNALIST:

Did Australia’s trade position improve in June?

TREASURER:

Well, why do you ask that?

JOURNALIST:

Because I was told to.

TREASURER:

Well, I don’t think there are any particular figures out today.

JOURNALIST:

No, tomorrow.

TREASURER:

Well, I will comment on tomorrow’s figures, tomorrow. I am not going to forecast them.

JOURNALIST:

What about inflation?

TREASURER:

Well, I will comment on tomorrow’s figures, tomorrow, I am not going to forecast them.

JOURNALIST:

Does the PPI raise any concerns to you?

TREASURER:

Well look, I think it is important that we keep our eye on inflationary pressures in the economy, we will have some more up to date figures tomorrow, but over the course of the year we see inflation continuing to be restrained.

JOURNALIST:

And Treasurer, do you have any comment on Mr Latham’s policy in regards to gambling?

TREASURER:

Well, the funny thing is that Mr Latham, he goes from one extreme to the other on gambling. Some days he is against it, some days he is for it. Today is apparently one of the days he is against it, but back on the 30^th of April 2001, he wrote an article in The Daily Telegraph in New South Wales opposing a freeze on poker machines, calling for more poker machines to be allowed for the Oasis Development of the Liverpool Council. Now, the Oasis Development of the Liverpool Council is what finally took the Liverpool Council into financial administration and in April of 2001, not only was Mr Latham backing this failed property development which lead to the closure and the sacking of the Council in Liverpool, but he was calling for more poker machines to be allowed. So, the thing about Mr Latham is he has one policy one day and another policy another day. Today it is his anti-gambling policy. Back in April of 2001 he wanted more poker machines in the Oasis Development to try and save the Liverpool Council. And the point I will always make in relation to poker machines is this: that where a Government gets into financial trouble, it always looks for an easy way out, and poker machines were an easy way out for State Governments that got into financial trouble. The important thing is to keep your economy running strong so you don’t need to rely on things like gambling to try and balance your budget.

JOURNALIST:

In response to the statement today talking about making a limit on cash withdrawals, what would you feel about that?

TREASURER:

Well, I just say you can’t take what Mr Latham says seriously on gambling because today he is against it but he was the one that demanded more poker machines in New South Wales, he wanted the cap lifted and he wanted the Oasis Development to have more poker machines, so like everything, it is one policy one day and another policy another day, you can’t take these propositions seriously. Thank you.