KIRK: Minister, good morning.
WONG: Good morning.
KIRK: Business leaders dont think you should deliver a surplus at any cost. They accept a small deficit this year to avoid big spending costs that will weaken the economy. Can you guarantee that your $4 billion cuts this year wont slow economic growth?
WONG: First, we remain committed to a surplus because its the right thing to do for the economy. When youve got an economy growing around trend, when youve got unemployment where it is, when youve got the investment pipeline where it is, a surplus not just in 2012-13, but in the years beyond is the right strategy.
And it gives the Reserve Bank room to move, and weve seen that weve seen the interest rate cuts this year, which of course are benefiting families and businesses around the nation.
KIRK: But isnt it counterproductive if you need the Reserve Bank to cut rates to stimulate economic activity after you slash spending?
WONG: This is part of a broader strategy weve been engaged in as the Government since after the global financial crisis where we said, very clearly, the Government should step back. We have a very clear fiscal strategy, and well do that.
KIRK: But can you say hand on your heart that your spending cuts will not slow economic growth?
WONG: We will always look to the impact on the economy, and thats what weve done in this mid-year review. Remember, what were doing is trying to get a better balance between monetary policy thats set by the Reserve Bank through interest rates and fiscal policy.
KIRK: But, yes or no, will your cuts affect economic growth?
WONG: We are anticipating an economy growing around trend. That continues to be the Governments view. And our fiscal strategy our economic decisions are guided by where the economy is. We have always done that. We have a track record of making the right decisions given where the economy is at.
KIRK: The first instalment of your mining tax comes in today. How can you justify releasing the budget update without knowing how much mining tax youll actually collect?
WONG: Alex, Ive seen or Ive heard Joe Hockey running a whole range of conspiracy theories around timing and about the mining tax. Id make two points. The first is, this MYEFO is being released today. I think, for example, in 2009 it was released in early November, about nine or ten days from now; its hardly the sort of conspiracy theory timing that Joe Hockey has.
And last year he was running around in November demanding that we release MYEFO because the fact that we hadnt released it meant we were hiding things. So I think, when it comes to Joe hell say anything
KIRK: But whats the
WONG: even if its not credible, to get a line up on radio.
KIRK: But whats the rush? A few more days and the economic picture would be much more accurate.
WONG: What I was going to go on to say is that we will be updating our revenue forecasts, including for resource rent taxes, in the usual way in the MYEFO. So I
KIRK: But isnt that counterproductive
WONG: I look forward to Joe recognising that, and recognising that his conspiracy theories held no water.
KIRK: But you wont be able to put the mining tax figures in the budget update without knowing whether the receipts come in as expected.
WONG: As Treasury said in Senate Estimates last week, theres always a bit more data around the corner and you should be cautious about extrapolating too much from any one quarters revenue for the whole year. But I think you will see appropriate updating of our revenue forecasts across all heads of revenue, including resource rent taxes.
KIRK: Todays Nielson poll has a small lift in support for Labor, but a big jump in support for the Prime Minister, for Julia Gillard as preferred Prime Minister. Shes now ten points ahead of Tony Abbott. Do you think that its in response to her speech accusing Mr Abbott of sexism and misogyny?
WONG: I dont comment on polls, as you know, but I would say that I think Australians are getting a very clear picture of the difference between the Prime Minister and Tony Abbott, and the Prime Ministers clarity about whats important for the country and her view about the future, and Tony Abbott who really does nothing other than be aggressively negative.
KIRK: But do you think its associated with her attack on him?
WONG: I leave the commentary to you.
ENDS