CURTIS: Penny Wong, welcome to ABC News 24.
WONG: Good to be with you.
CURTIS: The National Australia Bank has become the first of the major banks to cut interest rates. It hasnt passed on the full cut of the Reserve Bank. Was it ever realistic to expect that they would pass on the full amount?
WONG: Ive no doubt their customers want them to. Ive no doubt that NAB home loan customers wish that they had. And my view about this is they should do the right thing by their customers.
CURTIS: But do they also have to do the right thing and make sure that their funding costs are right to pass on the amount and not put their own put themselves at risk.
WONG: Im not going to do what Mr Robb did and start to defend run the business case for the banks. Thats up to them to do. I think they should be doing the right thing by their customers. Theres certainly been some commentary both ways about funding costs in recent months. But I would make this point: what the Government is doing, and its very important, has been to improve competition in this sector. And home loan customers should make sure they get the best rate they can.
CURTIS: But isnt it, even though youve made it easier, still a relatively big step for consumers to move banks, banks that they may have been with for a very long period of time.
WONG: Absolutely. I understand all of us go along and sometimes it seems like a lot of effort, but we have put a lot of effort in also as a Government in trying to lessen those barriers and weve seen an increase in people refinancing. So Id again say to any Australians out there who arent sure that theyve got the best deal on their home loan, have a look have a look at what else is out there. There is competition in the sector, and thats very important.
CURTIS: Now were a few days away from the Treasurer delivering the Budget. The Greens Deputy Leader Adam Bandt has told News 24 today that the Greens are prepared to knock back spending cuts they disagree with, even if it means the budget doesnt return to surplus. There is a risk there isnt there?
WONG: Theres a very important set of economic reasons why we should return the budget to surplus, and I think the Greens should be mindful of that. But lets remember, savings measures that need to pass the Parliament are in the hands, not actually of the Greens ultimately, but of Tony Abbott. He has a very great number of votes compared to the Greens in the Parliament ...
CURTIS: But theyre in the hands of both. If the Opposition decides to reject them you really have to negotiate with the Greens, dont you?
WONG: The Greens only become relevant if Tony Abbott says no. And the Greens only become relevant to the surplus if Tony Abbott says no.
So Mr Abbott is going to have a very important test next week. Is he so much of a wrecker that hes going to wreck the surplus? Thats the question.
CURTIS: The Treasurer in his economic note on the weekend said the changing structure of the economy means that tax revenue as a share of GDP is likely to remain lower than recent historical standards for some time to come. Doesnt that mean that your structure of revenue no longer suits the times, and will do more so as the structural change in the economy unfolds, and youre going to need a much larger change to the revenue base than is currently underway?
WONG: You always need to look at the structural position of the budget, which is why weve done things like means-test the Private Health Insurance rebate, and there are many savings measures weve taken in the Budgets until now which are about protecting the structural position of the budget the Dependent Spouse Tax Offset, removing that or grandfathering that, for example. But
CURTIS: But you have a big blueprint for change in the Henry Tax Review, and youre implementing that youve only implemented a few measures for that. Isnt there a case as the structure of the economy changes, something the Treasurer talks about a lot, to push ahead with that?
WONG: Tax reform is always important, which is why were pushing for the minerals tax, and why we think its important to ensure that through that mechanism, through that reform, more Australians share in the benefits of the boom.
We dont take the view that Tony Abbott does that parliamentarians, politicians, should stand up for the higher profits of wealthy miners. We think it is sensible to use some of that wealth across the economy and spread the benefits of the boom.
CURTIS: Is this Budget make or break for this Government, given all the problems the Government has had? Can you really say this is a game changer when nothing else seems to have worked?
WONG: Its certainly a very important Budget for the Government but its an important Budget for the economy, its an important Budget for the nation. It is the surplus Budget. Its a Budget that does ensure we come back to surplus, not just in 2012-13 but in the years ahead.
And its the Budget where I also say that Tony Abbott has to show whether hes really up to being a responsible Leader of the Opposition, or whether hes simply a wrecker.
CURTIS: Do you have confidence in the Governments ability to sell this Budget, to make the most of this Budget? Because Budgets in the last few years, even in the last decade, have almost sunk without a trace, theyre not historically big game changers.
WONG: Well, its a pretty willing time in Federal politics, and theres certainly a lot of focus on a lot of things. And some of the things that are being focused on are not the things that matter most to Australians.
I think what matters to Australians are things like the number of jobs that weve created since weve come to government; the fact that weve seen an interest rate cut; the fact that we see that our economy is bigger now than before the global financial crisis and certainly bigger than since we came to government. These are the things that really matter, the bread and butter things for Australian households.
CURTIS: But some of those things you mentioned the interest rate cut is not being passed on in full, and there are other problems that the Government is dealing with and hasnt managed to overcome. Even with the Prime Minister winning by a large margin a leadership contest earlier this year, things havent got better.
WONG: Theres a bit of commentary in there and theres a bit of discussion about the economics. Obviously whilst I think banks should pass the interest rate cut on in full, its also an interest rate cut that is very welcome. And its one of the reasons why we want to return to surplus, to continue to give the Bank the room to move.
Theres no doubt weve got a lot of work to do. But I didnt get into politics to just talk, I got into politics to try and do good things for the Australian people. Thats what were focused on in this Budget.
CURTIS: Theres eighteen months to an election, at what point do you think the public will begin to give you credit for the things you say youve done, like the management of the economy, and even for the carbon price which is still, youd have to say, unpopular in the community ...
WONG: As Ive said, weve got a lot of work to do. I hope also that people will see that the scare campaign that Tony Abbott is running on the carbon price is not going to be borne out in reality, and I hope that people will also see the reality of more investment in clean energy as well as the reality of more money, whether theyre a pensioner, or a person receiving a family tax benefit because these are all of the things associated with the clean energy package.
CURTIS: Penny Wong, thank you very much for your time.
WONG: Good to be with you again.
ENDS