TRANSCRIPT
of
HON. PETER COSTELLO MP
Treasurer

Doorstop
Parliament House
Thursday, 9 August 2001
8.40 am

SUBJECTS: OECD Report, heroin trials, Australian economy

TREASURER:

Overnight the OECD, which is the group of developed nations of the world, has released its economic report on Australia. What it finds, is, that the Australian economy is the fastest growing of the developed nations of the world, and it predicts it will be so, through the course of the end of this year and into next year. The United States economy has weakened considerably over the course of the last 12 months. Japan is in recession, growth in Britain, and France, and Germany, is weakening, but the Australian economy has strengthened in the course of 2001, and it looks as if it will be the strongest and fastest growing of the developed nations of the world. That is good news for Australia, the fact that we are keeping our exports up, notwithstanding a weakening of world growth, and it means that later in the year, as economic growth strengthens, you will get stronger employment growth. Employment growth tends to lag the economy, so that you would expect stronger growth in Australia as we pick up towards the latter part of 2001 to be reflected in further jobs in the beginning of 2002. But the good news for Australia is that we are weathering the slow-down in the world. We are beating the world in terms of growth. The OECD notes the importance of tax reform, how important it was for Australia, how the benefits will continue for years to come, will help the export industry and it has made our economy much stronger.

JOURNALIST:

Should there be extra tax on motorists or farmers to pay for environmental damage?

TREASURER:

Of course not.

JOURNALIST:

Mr Beazley says that if you look at the figures, (inaudible) pretty ordinary set of figures?

TREASURER:

Well, they are the best in the world, so I don’t know what Mr Beazley reads with his weeties, but the OECD has said that Australia’s growth is the best in the world, better than the United States, better than Japan, better than the UK, and France and Germany. Now, I suppose Mr Beazley will be upset today because Australia is doing well, but most Australians will be pleased to see that Australia is doing well and that we are leading the world. Unfortunately, if Australia does well Mr Beazley is unhappy. He is only happy when Australia doesn’t do well.

JOURNALIST:

Are heroin trials a good thing or a bad thing?

TREASURER:

Did you want to ask any more?

JOURNALIST:

Are heroin trials a good thing or a bad thing?

TREASURER:

No, they are a bad thing.

JOURNALIST:

You don’t support one?

TREASURER:

I don’t support heroin trials, I never have. I don’t believe that we should be sending a mixed message at all. Drugs are bad and we should be warning Australians, particularly young Australians, not to have anything to do with them. We shouldn’t be sending a mixed message that somehow we approve, or somehow they are permissible. They do you damage, you don’t take them.

JOURNALIST:

(inaudible) heroin trials…?

TREASURER:

Well, I have never supported heroin trials. I don’t believe they would be good for people. I think it sends a mixed message. We don’t want to send a message to young Australians that somehow drugs can be legalised and the dangers taken away from them. We want to send a message that these are dangerous things, don’t mix with them, and don’t give it a try because it will destroy your life. That is the message we want to send.

JOURNALIST:

Has the Government lost faith in Mr Crooke, the head of the NCA, given that he seems to have said, well, we are losing the war?

TREASURER:

Well look, the Government is responsible for policy and the Government’s policy is against heroin injecting rooms. The head of the NCA is responsible for fighting crime and I would recommend…

JOURNALIST:

(inaudible)

TREASURER:

…I would recommend to him that he fight crime.

JOURNALIST:

(inaudible)….and loosing that fight. I mean doesn’t that give you cause for a lack of faith in him as the head of the NCA?

TREASURER:

Look, I am not the Minister responsible for the NCA, but you asked me my view. My view is, that the National Crime Authority ought to be fighting crime, and it ought to leave policy matters to the elected representatives. Now, anybody is entitled to have a view on policy but it is elected representatives, who the people elect, that are responsible for changing the law. And the elected representatives under the Coalition Government are opposed to heroin injecting rooms. Labor apparently is in favour of them, so that if they were elected they would have the right to introduce heroin injecting rooms throughout Australia. But the elected representatives, the Coalition Government, who are responsible for introducing policies are opposed to it. We want to be tough on drugs, and we don’t want to send any mixed messages to people out there, that somehow you can play around with drugs, it can be made clean, or legal, or safe. It can’t be, and particularly to young Australians we would say don’t be tempted, don’t try it.

JOURNALIST:

Does the OECD report give you any indication of a bit more room to move (inaudible) tax cuts?

TREASURER:

What the OECD report shows is that the Australian economy is strengthening and is stronger than any in the developed world, particularly stronger than the United States, Japan, and Europe. The good news, is, although the world economy is weakening Australia has held up again.

In 1997, 1998 we stared down the Asian financial crisis, now the world is weakening and Australian growth has held up again. It wouldn’t have happened if we hadn’t engaged in tax reform. It would not have happened if we hadn’t balanced the Budget. So what this reinforces is the need for further good economic management. It doesn’t say we can now give up good economic management, we have got to keep it going. It wouldn’t have happened if we hadn’t have done it in the first place.

JOURNALIST:

(inaudible) also reinforces a stronger economy and bigger surplus and you will be looking at bigger tax cuts in the election?

TREASURER:

Well no, it does not have any implications for policy changes, except this, that it reinforces the need for good policy to continue. That is what it reinforces. Look, these things don’t happen by accident. Australia has not had an economy which has outgrown the United States, and Japan, and Europe, by pure chance, or pure luck. It is because we balanced our Budget, we now have paid off $60 billion worth of Labor debt. We took taxes off exports, we re-organised our tax system, we cut income taxes, we cut company taxes and capital gains taxes. And you don’t want to think that all the challenges are over. The world economy is very, very, uncertain. The strongest economy in the world, the United States, is now very weak and the message you should take out of this, is, we have seen some results from good economic policy in the past, but, gee, we need some in the future if we are going to continue them.

Thanks.