Fri, 16th May 2008

Nelson interview with Greg Carey (Radio 4BC, Brisbane)

The Hon Dr Brendan Nelson MP
Leader of the Opposition

E&OE

CAREY:

Dr Nelson, good morning.

DR NELSON:

Good morning Greg.

CAREY:

It’s good to talk to you. How did you feel giving it last night?

DR NELSON:

Well you always feel a little bit nervous in these things, talking to the nation. But I felt quite comfortable about framing the Budget. You’ve got to ask yourself: is it really going to help me with my home, groceries and petrol? Certainly a Budget that puts 134,000 people out of jobs is not a good one in my view. And then to set out and remind Australians of the strong economy created over the last decade or more, and then I had a number of policy announcements and set out our beliefs as Liberals in the individual and rewarding hard work.

CAREY:

It was powerful, and we’ll get to some of those things you outlined in just a moment, including alco-pops and excise on various things as well. When you say that loss of jobs how do you calculate that?

DR NELSON:

Well the Budget papers themselves Greg actually forecast 134,000 people, more people will be unemployed at the end of the year according to the Government. The economy, the rate of growth in the economy is slowing, which is the objective of the Government, and also they’re rolling back the workplace relations changes and the end result of that is that the Government is actually budgeting for 134,000 people to lose their jobs. And in the last few weeks, for example, you’ll notice there’s a lot more talk about work for the dole which has been watered down and getting people, supporting people that are on welfare and so on.

And, as I set out last night, we’re unaccustomed I think in recent years to have tax increases in budgets. We’re unaccustomed to the talk about dealing with the unemployed, in fact as you know 10 or 12 years ago there was no talk of a skills crisis. So the 134,000 actually comes from the Government’s own budgeting.

CAREY:

Okay I want to get to pensioners in just a moment too. That seems to be the hot ticket item and I didn’t hear a whole lot about that last night, but we’ll get to that in a moment. Alco-pops – the Government says they’ll raise I think around $3 billion over the next four years. It seems like a phoney argument. But don’t I recall you supporting it tentatively in the early stages?

DR NELSON:

Yeah Greg look I’m a doctor by training. I’ve spent a lot of my life working with the consequences of alcohol abuse. I’m also a parent. I’ve got two 21 year old twins and I’ve got a 16 year old daughter. So obviously all of us, and like probably yourself and your listeners when I heard Mr Rudd say, ‘oh we’ve got a problem with binge drinking with young people, increasing the tax on alco-pops will deal with it’, like most people I said well look in principle we’re prepared to support this but I want to see the evidence.

We’ve seen the evidence. And I can tell you we’re very angry because binge drinking amongst young people, young girls in particular has actually declined since 2001 by around 10 per cent. Further to that these alco-pops – we all naturally think of those coloured fizzy drinks that have got alcohol in them – 80 per cent of these so-called alco-pops are Jack Daniels and Coke, Jim Beam and Coke, Bundy and Coke and those sort of mixes, and further to that the Government in its own Budget papers is forecasting consumption to continue to increase on average 10 per cent a year compounding. So my argument is – and I’ve got a lot of experience with this – if you want to deal with something, for example alcohol abuse, you need a fully integrated approach which is about education, it’s about prevention, it’s about using price signals across the board and you’ve got to make darn sure that it’s a fully comprehensive approach which also goes to parenting and policing.

CAREY:

Yeah, again I agree with all that. At the outset you said most of us would have given it tentative support like you did.

DR NELSON:

Yeah, of course.

CAREY:

Well most of our listeners didn’t, and we didn’t. We just thought it was phoney from day one. It’s a phoney policy and a clear tax grab. Does it worry you that your instincts didn’t grab hold of that straight away?

DR NELSON:

Well look my instincts I suppose as a parent, as a doctor, and someone who’s trying to have a fair open mind was that when Mr Rudd said something, particularly something that concerns us all, and that’s the welfare of young people, I thought well in principle I’ll give support to it but I also said on that first day, but I will want to see the evidence upon which it’s based.

You are absolutely right, it is nothing more than a $3 billion tax grab which in fact will for those young people and others who don’t continue to buy these products they’ll go on to some other form of alcohol or possibly as I said last night some other form of drug.

CAREY:

Okay just on what you told us now though, you’re saying, and I head you say it last night, you’re going to convene some kind of a get together of experts in the area, but you’ve just also said to us quoting figures that there’s not the problem the Government says there is. So, is there a problem and if there’s not, why have the get together?

DR NELSON:

There’s a problem with alcohol abuse in our community. It’s not confined to young people. It’s right across our society and no-one should deny that there is a problem with the consequences of alcohol abuse. That’s the first thing that needs to be said. The second thing, however, is that these so-called alco-pops are not of themselves the cause of this problem. Nor indeed currently is the price of it.

And what I’m going to do – and by the way this is not going to be some high profile, media management and spin that we get from Mr Rudd – I’m going to bring together key people that I know are experts in this field, who work in this field, including policing, including education; people who come from parent organisations. And I am prepared and will lead the development of a comprehensive approach in Australia to the abuse of alcohol, including amongst young people and then I’ll present that to Mr Rudd and to the Australian community for their consideration.

But one thing is for sure, we are not going to support a simple increase in the tax on one alcoholic product that takes $3 billion out of the pockets of predominantly low and low-middle income Australians when it will have no impact on the purported reason for it, which is so-called binge drinking amongst young people.

CAREY:

When you talk about the abuse, and it is widespread, and given your background as a doctor, you’ll have a feeling on this before talking to the experts and obviously you’ve talked to experts down the years. What’s your feeling, what’s causing that abuse?

DR NELSON:

Well look, it’s a complex issue but we have to ask ourselves why is it that there are some people – young people, older people – why is it that they want to become intoxicated? We’re living in a society where every day young people for example get presented with role models which I think debase and devalue how young people feel about themselves. We run certain television programs 24 hours a day across the cycle. I think also… a young person said to me recently, ‘Brendan, the problem is that a lot of parents don’t know how to be parents’, and she was referring to the fact that a lot of underage kids for example have alcohol purchased for them by their parents, for goodness sake. So I think it’s a complex issue. But Mr Rudd under the false deception of making you think that a tax increase on one alcoholic product alone will fix it, and take $3 billion out of your pocket, it’s a deception in the first place – that’s why I’m angry about it – and the second thing is it’s just a tax increase charading as something else, which I think will actually have the potential to compound the problem we’ve got, not make it better.

CAREY:

As part of that holistic approach, would you have a look at what some people are advocating and that is the limit on the advertising of alcohol?

DR NELSON:

I think it’s something we do need to look at. We need to look at labelling, we need to look at marketing, we need to look at education, we need to look at parental education as much as the education of young people themselves, we should be enforcing policing, a lot of these issues are basically revolve around the enforcement of laws that exist at the moment.

And I’ve spent a lot of my life, Greg, for example working in tobacco control. Reducing smoking rates in Australia involved three things. Sophisticated and targeted education. It involved price increases, and it also involved the prohibition on advertising. Tobacco is quite different from alcohol. There’s no safe level of consumption for smoking but there is a safe level of consumption for alcohol and that’s why you can’t just say we’ll have blanket banns on advertising, for example.

CAREY:

Just onto the fuel tax, and I’ll get to the pensions in just a moment as well, you’re going to reduce, what by five cents a litre, the excise? How can you guarantee us, or yourself for that matter, that the fuel companies won’t just gobble that up and we won’t see the difference?

DR NELSON:

Well look, whatever the circumstances, and Mr Rudd has assured us that won’t happen, by the way, he’s got someone watching the price of petrol, which of course doesn’t bring it down and he’s also said that he’s given more power to the ACCC. So if we accept Mr Rudd at face value on that argument….

CAREY:

But you can’t, but you’ve already said you won’t, so how can we? So how are you going to do it?

DR NELSON:

If we do accept at face value that the ACCC has got those powers to stop profiteering…

CAREY:

But they don’t...

DR NELSON:

...whatever the price, whatever the price Greg, if we cut the excise by five cents a litre it represents a modest but decisive and positive reduction at whatever price that petrol will be. We believe in lower taxes, the Labor Party believes in higher taxes. We delivered income tax cuts six of the last eight years. Mr Swan delivered the last of Peter Costello’s tax cuts on Tuesday night. We think now that petrol is running at least in the southern states around $1.50 and certainly getting to unacceptable levels, that the one decisive thing the Government can do is actually cut the excise so that’s our view.

CAREY:

I reckon you’d agree that sometimes it’s easier to say these things in Opposition but harder to do it when you’re in government. You were in government an awful long time and I understand from my reading that the Government in the period of its reign took in $135.4 billion in fuel excise. So you weren’t talking this talk at the time. Instead you were taking the excise.

DR NELSON:

Well in fact there are a couple of things. We froze the indexation on fuel excise in 2001 and cut it with the introduction of the GST. Decisive action was taken then. Petrol was not then at $1.40 to $1.50 a litre. We also have always argued for lower taxes. As you know, Greg, I saw you when I was in Brisbane. I’ve been on the listening tour. I mean what’s the point of going on a listening tour if you don’t hear anything? And the single most common concern to reach breaking point amongst Australians generally is the price of petrol. They know that it’s got a lot to do with world oil prices and things that can’t be controlled, but the one thing the Government can control when they’ve been given a very, very strong economy is the excise or the tax that’s on it.

We will fully fund and fully budget that as we always have with the commitments that we have made, but my commitment to your listeners is that a Coalition government will reduce the excise on fuel by five cents a litre and if Mr Rudd chooses to do it – I mean the Labor Party added five cents to the excise in 1993 when Mr Keating was destroying the country. If the Labor Party now chooses to take it out it needs to reorder its priorities.

CAREY:

Yeah, I just wonder where all that money from the excise has gone though. If in your term you took in $135 billion, a lot of it was meant to go to improvements on highways. We’ve still got potholes in the Bruce Highway and still around the place. How do you respond to that?

DR NELSON:

Well that over 11 and a half years, keep in mind we had close to $100 billion in Labor debt to pay off for a start. We faced a Budget deficit of $10 billion in that very first year. We worked very hard and your listeners in fact worked extremely hard to change the shape of the country. Once we got Australia into a stronger position we started delivering income tax cuts. We put record sums of money into roads and we also by the time we left government last year we had significant billions of dollars in Auslink to fund road projects. That money that was raised on that excise, that’s gone into a lot of things that Australians need in terms of defence, health, education and a variety of things. But looking at Australia’s… the circumstances of everyday Australians now, I think that it’s time for us to, in terms of further tax cuts in the future, to be looking at excise on petrol. It also has a modest deflationary effect too Greg.

CAREY:

Okay just going back to alco-pops for a moment. While you and I were chatting, callers have rung in asking how you’ll stop the price increase of alco-pops in the Senate when they’ve already gone up in the bottle shops – and they have haven’t they?

DR NELSON:

Yeah, well look what we intend to do is to block this particular measure. I should say, by the way, we’re not… Some people have said we’re going to block the Budget. We’re certainly not going to block the Budget. But this is a tax measure and what we propose to do is to block this legislation, that it would effectively stop at the time that it is opposed in the Parliament if that is the case. The money that has been already been collected obviously will not be returned to people who’ve paid it, but my very strong view and Mr Rudd is currently taking $40 million a month out of the pockets of your listeners who are buying bourbon mixes. That money should go entirely to alcohol prevention and treatment programmes. But essentially from the day that we successfully – hopefully – oppose this particular measure, the price will return to where it was.

CAREY:

Pensions. There was very little in the Government’s Budget. I didn’t hear a lot from you in response last night?

DR NELSON:

Well look, I think that the level of the pension at the moment does need to be increased. One of the things that we – we’ve obviously have been in Opposition now for approaching six months – we’re going through the process, Greg, of reviewing all of our policies. Some of them we’ll keep, some of them we’ve already, like WorkChoices for example, we’ve already abandoned. And we’re developing new policies.

In terms of my priorities it’s making sure that we get the economic fundamentals of Australia right. That’s the first thing. The second thing then is pensioners, seniors, carers, people with mental health and disabilities. The things that really define and shape us as a nation and what’s important to us.

So I can understand some of your listeners saying that for example I could have said or announced more last night in relation to pensioners. We’ve still got two and a half years to go in this electoral cycle but I can assure you that when we go to the people for the next election you will see policies in relation to pensioners which will bring more justice to them.

We did deliver pensioner bonuses for example and it was only under extreme pressure from us a couple of months ago that Mr Rudd actually locked in for that for this financial year, but I notice he hasn’t got it for the next four.

CAREY:

Yeah, I understand that. But again you were in government for 11 years, single pension $546, couple $456 each. I think you’re underestimating, with respect, and certainly the Prime Minister is, the level of passion and genuine anger, not just amongst pensioners but from all Australians who want a decent lifestyle for older Australians. And when you talk about getting the economic fundamentals right then you gave me that other list. Why not guarantee first that we take care of our older Australians? They’ve earned that, and then make sure we’ve got everything else right to make sure we can do that?

DR NELSON:

Well, Greg, I firstly say to you that unless we get Australia’s economy right we haven’t got money that we can give pensioners or anybody else. I mean most of us would remember what it was like under Mr Keating when we had more than one million people unemployed, businesses going to the wall, you couldn’t get your kids a job.

CAREY:

But we’ve got monster surpluses?

DR NELSON:

Correct. We’ve now moved into a situation where we’ve had good management, we’ve got very, very large surplus budgeting and what we did in government was to change the indexation model for pensions so it was either the CPI or average weekly ordinary time earnings, the indexation model for that. We introduced the concept of pensioners lump sum payments annually. We also introduced a utilities payment. The two things last night that I did announce which will positively affect a number of pensioners is to oppose the Government’s changes to the Medicare surcharge which will put private health insurance premiums up. And it will also take money out of Medicare which will affect pensioners. The other thing of course is the reduction in the fuel excise ultimately has a flow-on effect, not only for pensioners who are able to have a car but particularly groceries and the cost of transport.

CAREY:

Yeah that’s a big caveat you’ve just said there for those who can afford to have a car…

DR NELSON:

Yeah, very few.

CAREY:

We had a fellow ring our radio station yesterday. Lovely man, John, who simply can no longer take his son for a drive. That’s how hard it’s hitting. So again I put to you, in opposition what can you promise pensioners that you can do in opposition and if become government again to turn around this parlous circumstance?

DR NELSON:

Well, one of the things… I can’t promise anything today specifically other than to say that in the process of developing... Look if we were a few months away from an election, obviously I would have sophisticated, fully costed, developed policies for pensioners and others that I’d be presenting to you.

CAREY:

But we just were, we’re only five months into a new Government, where were they then?

DR NELSON:

But I can assure you that we will have measures which improve the life and wellbeing of pensioners. One of the things that I do think needs to be done is, and I’ve said this before – it might have been on your programme actually – that I think we do need to increase the level of the basic pension and that is one of the things that I will be very much focused on. But again we’ve got to make sure we’ve got the numbers right. We’ve got to have it costed, we’ve got to have it budgeted.

CAREY:

A dramatic increase?

DR NELSON:

Well, just watch this space, Greg. I’ll be back to you on that.

CAREY:

Okay. And I know you nearly need to go but our children in grades 3, 5, 7 and 9 this week have been doing their literacy and numeracy and all around the country. And now there’s…

DR NELSON:

Yes.

CAREY:

But the Rudd Government promised us they would make these things public as I think a lot of us think they ought to be. Now they seem to be backtracking, what’s your feeling?

DR NELSON:

Well firstly they’re doing those tests in literacy and numeracy because we introduced them. In fact I was the education minister at the time, and I had a huge fight with the state governments over this. The results of those tests must be made available to parents individually. And they must be made available to the broader community.

One of the reasons, for example Greg, why a lot of parents are by-passing terrific state schools is because they can’t get the information about how the school actually performs. You can get more information about the performance of a factory than you can the performance of a school.

There’s nothing more important in Australia I think than getting the educational fundamentals right for our kids.

It’s about their development and it’s about our economic welfare and I think the Government is being gutless and it’s breaking another promise that it’s made to the Australian people if it does not go and publish those results. You should be able to shop around and compare the performance of schools and know exactly what teachers are delivering for kids.

CAREY:

Opposition Leader Dr Brendan Nelson, enjoy your weekend.

DR NELSON:

Thank you Greg, you too.