SENATOR THE HON PENNY WONG

MINISTER FOR FINANCE AND DEREGULATION

TRANSCRIPT

6 November 2012

SKY AFTERNOON NEWS WITH KIERAN GILBERT

TOPICS: COALITION POLICY COSTINGS, INTEREST RATES

E&OE - PROOF ONLY

GILBERT: Thank you for joining us, Minister.

WONG: Good to be with you again.

GILBERT: As I say it surprised a lot of economists. Did it surprise you?

WONG: You know Ministers try not to comment too much on what the RBA will or won’t do. But I think the reality is we’ve had, I think, six interest rate cuts since the last Melbourne Cup, so there’s already been a substantial loosening of monetary policy from the RBA’s perspective. But ultimately these decisions are a matter for them.

GILBERT: There are signs of uncertainty, though, of course in the mining sector, also, small and medium-sized businesses; the Chamber of Commerce yesterday issuing a business expectations survey that shows a lot of those small and medium-sized enterprises are struggling. They’ll be disappointed today, no doubt.

WONG: The high dollar is making life very difficult for various parts of the Australian economy – I think that’s well documented. However it’s important to remember, despite some of the challenges, we’ve got an economy that’s growing faster than any other advanced economy, an economy that’s got relatively low unemployment, and an economy with a lot of investment coming into it. So there’s a lot of strong data, as well as a lot of challenges, and we’re very aware of those challenges.

GILBERT: The RBA says monetary policy is at an appropriate level for the time being. Is that code for indicating that in December we might see a cut do you think? Or at least that there will be a cut over coming months?

WONG: I’ll let the RBA speak for themselves; I’m sure you and other commentators can read the tea leaves however you want. The fact is it is the case at the moment that we see interest rates lower than at any time since the Liberals left office. We see, obviously, a Government that’s engaging in a pretty substantial fiscal consolidation, and that has given the RBA room to move should it decide to do so. But, ultimately, these are decisions for them.

GILBERT: In an associated statement with the rates decision, the Governor says: ‘the introduction of the carbon price affected consumer prices in September and there could be further small effects in the next couple of quarters’. Did you expect that the carbon tax would have this flow-on effect – flow-on impact – on rates?

WONG: We expected the carbon price would have a temporary impact on inflation, but the reality is that’s been factored into the Government’s approach to the tax cuts as well as the increases to entitlements such as pensions.

And I would make the point that the RBA itself has said that it looks through these sorts of temporary increases, such as the carbon price or, for example, a spike in particular food prices because of a temporary shortage. Ultimately, the RBA has to look through a different lens – a medium-term lens – and they made their decisions on that basis.

GILBERT: On another issue, the Treasurer’s office has confirmed that it was responsible for releasing or leaking the Treasury analysis into three Coalition policies. Is that really the sort of thing that builds confidence in an independent public service?

WONG: I think there is a public interest in the alternative Government having their policies transparent. And I have to say I think the bluster we’ve seen from Joe Hockey in the last twenty-four hours simply to cover up the fact that he doesn’t want Australians – and in this case Australian business, small and large – to know precisely the cost of his policies. I think what’s embarrassing here, and what’s bad for public confidence, is that the people who say they are ready to run the country refuse to be upfront with the Australian people about the cost of their policies.

GILBERT: But it’s not a correct assessment of the policies, is it? Because, as Tony Abbott points out, and Joe Hockey points out as well, it doesn’t factor in the fact that they’re going to scrap the carbon and mining taxes. 

WONG: Kieran, if they say it’s wrong, they can trundle down to the Parliamentary Budget Office – a resource that no other Opposition has had – they can get their costings according to their assumptions – which they won’t explain to you, or to the Australian people – get it costed and they can release it publicly.

I’d actually welcome that, because I think it’s about time this Opposition started to put a little bit of accountability into the way they conduct politics, and a little bit of transparency I don’t think would go astray.

GILBERT: Are you worried, though, at the impact on the public service, and the perception of an independent public service, if you as a Government use analysis done by Treasury for your own political ends?

WONG: I think there is a public interest in the alternative Government having their policies transparent to the Australian people. And I think anybody who is arguing against that is really saying Australians don’t deserve to know what the Coalition’s policies cost.

GILBERT: But the Treasurer’s office says that Governments have used advice and analysis to contribute to more ‘fulsome debate’ about policies. But to have a fulsome debate, shouldn’t they have included one of those key elements, or two of those key elements, and that is scrapping the carbon and mining taxes? Just to be fair to the analysis?

WONG: I again say, I’ve heard Joe Hockey saying ‘the assumptions are wrong’, well he’s got the opportunity to lay out his assumptions of all of his costings, of all of his policies, have them costed independently by the Parliamentary Budget Office – I don’t get to see that, that’s all done independently. And then he can release them to the Australian people. The fact that he’s refusing to do so says something about how little transparency the Coalition want on them between now and the next election.

GILBERT: But the Government is being accused of being selective on this because you released the costings when it comes to the Coalition’s policies, but not when it comes to the Greens’ policies. That essentially, the Government’s protecting the Greens for policies that they wanted costed themselves.

WONG: I think you’re talking about the Freedom of Information request?

GILBERT: Yeah, exactly.

WONG: And what I’d remind you of is that under this Government, we – i.e. Ministers – unlike what happened under the Howard Government, we don’t actually determine Freedom of Information requests. That’s done independently by a public servant. We don’t interfere with them. We don’t have what were called ‘conclusive certificates’ which existed under the Howard Government’s regime. So, I don’t think you can accuse us of playing politics there when these are decisions made at arms length from Ministers, independent of Ministers.

GILBERT: But you could go outside the FOI process, as the Treasurer shows with his office releasing the Coalition’s costings.

WONG: What I’d say to you is that I think there is a public interest in the alternative government having their costings –

GILBERT: Not the Greens?

WONG: The Greens can speak for themselves. I don’t know that the Greens are claiming that they’re going to form Government after the next election. Tony Abbott wants to be Prime Minister after the next election, and I think there’s a different level of accountability on someone who says they want to run Government.

I think the Australian public do deserve, whether it’s the Greens, or the Coalition – and they’ll certainly get it from us, because we’ve said we’ll comply with Peter Costello’s Charter of Budget Honesty – we are the only party who has said that.

But I do think the Australian people are entitled to see the costings from the major political parties, whether they’re the Greens or the Coalition. And the Parliamentary Budget Office would allow that.

GILBERT: Finance Minister, Penny Wong, thanks very much for your time, I appreciate it.

WONG: Good to speak with you again.

ENDS