RIMINTON: Good morning, Minister.
WONG: Good to be with you again.
RIMINTON: Now, 4.3 per cent growth. Congratulations. Is the surplus now, in your view, an absolutely sure thing?
WONG: Weve laid out our plans for a return to surplus in the Budget, and made a great deal of savings about $34 billion worth of savings to ensure we will deliver a surplus. And the reason we did that is because we want to make sure, in an economy that is growing, that we give the Reserve Bank room to move on interest rates and ...
RIMINTON: OK, the reasons for wanting
WONG: ... before the Budget and after the Budget, we have seen interest rate cuts.
RIMINTON: Tony Abbott is still saying surplus well believe it when we see it. Weve now got this 4.3 per cent growth figure surely you are in a position to say that you can lock that in; that the surplus is a sure thing?
WONG: Were determined to deliver a surplus. We have been clear about that, and Tony Abbott can talk all he likes, but he's an Opposition Leader who refuses to come clean with the Australian people about the cuts hes planning to deliver a surplus. Remember, he's agreed to a whole range of spending matters whilst opposing, for example, the mining tax. That puts him in the position of having to cut services to ordinary Australians if he wants to deliver a surplus. Thats why hes not telling people. But, the reasons, as you say, for coming back to surplus have been demonstrated by the interest rate cuts that weve seen.
RIMINTON: Now, of course, the growth figures of the March quarter ... is there anything youre seeing from where you sit, since March, that would give you any indications
you can give us about where things are going? There have been some negative ... thereve been some head winds since then.
WONG: There are head winds, but I think this week of extraordinary economic data should give us some pause for thought, and I think all Australians should recognise and be congratulated for what weve managed to do. Weve come through the global financial crisis, continuing to grow; extraordinary growth figure this week. Weve got low unemployment figures. Weve seen more jobs created, and more people entering the labour force. Weve got interest rates at a very low level, certainly a cash rate that we never saw under the Coalition. We have inflation that is contained. Its a pretty good set of circumstances. Yes, there are head winds, Hugh, as you said, there are head winds and we see them in Europe. But we face those head winds with a lot of confidence, and this week can give us that confidence.
RIMINTON: As you say, the indicators are all pretty good. Here are some of the indicators, though, that caught Tony Abbott's eye.
GRAB TONY ABBOTT: The stock market is down. Profits are weak. Retail sales are weak. The property market is down.
RIMINTON: He is actually right, is he not, on every single one of those points?
WONG: Well, you can always count on Tony Abbott to find something negative to say, can't you? I mean, in the face of the sort of economic data that weve seen this week, rather than saying, This is great for the country because that is what we are talking about. Its not about the Government, its about the country, its about the nation, its about the jobs of working Australians and instead of saying those are good things, hes got to have a go. The reality is, weve seen household consumption, in fact, very strong results in the last national accounts. Its true that people's consumption patterns have changed. There's a lot of discussion about that. People tend to be spending in different ways, but, certainly, consumption is holding up ...
RIMINTON: Is that part of the problem that Glenn Stevens touched on this week in his speech? You talked about patterns changing, that theyre essentially shifting. There is a major shift going on from being essentially spenders to savers. But the miserable reality is that if youre not spending so much, you don't feel so wealthy, you dont feel so well-off, and that the lever, if you like, has gone from greed, wanting things, into a fearfulness about the future. Is that part of, do you think, the explanation for your very poor pollings the lack of satisfaction that people seem to have in the Government at the moment goes down to the sense of economic wellbeing?
WONG: Id make a couple of points: the first is that there is no doubt, as we have seen from these figures, that weve got a very strong economy and we know there is a very, very big mining boom on. But around the country, there are a lot of Australians who are saying this isnt my boom, I don't feel like I'm part of this. We know that weve got a high dollar and a patchwork economy and that means people don't feel the benefits of the boom and part of what the Economic Forum is about is how we spread the benefits from the boom how do we address the issues of the high dollar and the patchwork economy? The Economic Forum is about how do we look to spread the benefits of the boom to all Australians?
RIMINTON: The NSW Treasurer, Mike Baird, has been talking about the impact of Europe potentially on NSW finances. Weve seen Spain looking for a bailout for its banks. Whats your assessment of the significance of that for us?
WONG: There's certainly a lot of work to do in Europe. We welcome the moves that Europe seeks to take to improve its position, to shore up the stability of its financial system and to improve its economic prospects. Theres no doubt that Europe has an effect on the global economy, and Australia is not immune. But what we can say given the data, given the massive investment pipeline were seeing coming into this country, a very big vote of confidence in the Australian economy by investors is that we can face that turbulence with a great deal of confidence. Europe has a long way to go. We are aware of that, Hugh. We, in fact, have factored in more pessimistic forecasts for Europe in the recent Budget than most of the international institutions.
RIMINTON: OK, were going to take a break. Were going to be joined with our panel up next.
** ADVERTISEMENT BREAK **
RIMINTON: Welcome back. This is 'Meet the Press'. Our guest is the Finance Minister, Penny Wong, and our panel today, Sabra Lane from the ABC and Mark Kenny from The Advertiser. Good morning to you both. Tony Abbott has said repeatedly that the next election will be a referendum on the carbon tax. Hes certainly going to have a busy first day as Prime Minister because his first phone call, we know, is going to be the President of Nauru. But he is also going to be doing this:
GRAB TONY ABBOTT: On Day One, we will begin the process, and I am confident that we can get rid of this carbon tax.
LANE: Minister, is there any technical reason why Tony Abbott can't get rid of the carbon tax, assuming the Coalition does win the next election and assuming they do win control of the Senate?
WONG: Theres a huge economic reason which would be problematic. Once you introduce a price into the economy, and business factors that price into its commercial decisions, its contractual arrangements, its not sensible economics to simply take that price away because you are interfering with business certainty that is important for ongoing investment. Its not an economically sensible position that Tony Abbott is putting forward. But that isnt unusual he rarely seems to put forward economically sensible propositions.
LANE: So, are you suggesting that the Government might have to be prepared to pay billions in compensation if it does unravel this tax?
WONG: I think you should be asking Tony Abbott that. What I'm saying is a very simple proposition that once you have introduced a carbon price, business takes it into
account in terms of its investment decisions, in terms of the contracts it signs, and that its not a sensible thing to then say, Well, were just going to take that all away. That is the reality. Recall, we are pretty close to the carbon price starting, so this isnt going to be theoretical, its going to be very, very real.
LANE: Mr Abbott has said that the next election will be a referendum on this tax. Would Labor respect an overwhelming result in favour of the Coalition and simply let him get on with his plans to repeal it?
WONG: This is a hypothetical, isn't it, because were focused on governing now, and making sure we do our very level best to return a Labor Government. But what I would say is this: that there's a lot of negativity by Tony Abbott. There's a lot of talk about all the things hes going to destroy. My view has always been that its in Australia's interest to have a carbon price and climate change is not going to go away, nor is the imperative to ensure that our economy pollutes less. Both of those things continue. So thats why I've always been supportive of a price on carbon.
KENNY: Minister, just on the politics of it, what is more toxic to the Government the carbon tax or the broken promise that set it up?
WONG: Ill probably leave that to you, Mark. Im sure that could be something you talk about in your columns. Look, I understand
KENNY: You must be talking to voters, though, you must have some sort of feeling from electors about which of those two things it is whether its in fact the way it was set up, the sense that Julia Gillard said there wouldnt be a carbon tax, or whether its a fear of the actual impact of the tax itself?
WONG: Theres been a long history of political debate on this issue, hasnt there? We went to the 2007 election, both parties both John Howard and the Labor Party saying we wanted a price on carbon. I was the Minister who sought to negotiate and did get an agreement with Malcolm Turnbull, because we wanted bipartisanship, that then got smashed because Tony Abbott took over the leadership and opposed it. So, it is a highly contested political issue and it is certainly the subject of a pretty amazing fear campaign. One thing I will give Tony Abbott is that he is a very good, very aggressive politician. He is a very destructively negative politician. And hes done a very good job at running a very destructive fear campaign. Of course, the reality of what a price on carbon will mean we will see very shortly, and people will see there won't be towns wiped off the map. Theres not going to be industry shutting down en masse. And you saw even in some of your footage of the week that Tony Abbott's already starting to walk away from the sort of rhetoric hes been engaged in and I think thats going to be important to get this debate onto a more sensible and even keel.
KENNY: Julia Gillard was given time to get this tax in and bed it down very comprehensively by colleagues in February when the leadership was under question then. Youve just said that you expect that there won't be the sort of doom and gloom that Tony Abbotts been predicting. How long does Julia Gillard have if Labor's numbers don't improve?
WONG: Mark, I have made clear my view on this the leadership issue has been resolved. The more important issue at the moment is making sure we implement the carbon
price well, and Ive got every confidence in Greg Combet that he will do that and he is doing that. The more important issue is the week of economic data we have seen. In a world that has got a whole range of challenges in the global economy, we are growing in excess of 4 per cent. Weve got low unemployment. Were continuing to create jobs. Weve got contained inflation, and our interest rate is the lowest cash rate weve seen in years. Now, these are very, very good results, for, not just the Government, but for the Australian people.
LANE: Minister, a number of MPs have talked about the increase in hate mail that they have received, particularly over the same-sex marriage legislation that is before the House. Have you noticed an increase in the mail and has it been more vitriolic than other issues that you have received info on in the past?
WONG: I've been in Parliament, would you believe it, 10 years on 1 July. Its a democracy. We get all sorts of emails, we get all sorts of mail, you get positive and negative. You get some which is a bit, you know, more ... in stronger language than others. But thats just part of the process of our democracy. I've made my position on marriage equality very clear.
RIMINTON: If I can take a brief wade on the shallow side the Prime Minister this week was noticeably not singing 'God Save the Queen' at a Diamond Jubilee event. Here was Tony Abbott this morning:
GRAB TONY ABBOTT: Maybe she doesn't know the words, maybe she doesn't know the tune. Maybe they were singing 'The Internationale' or something when she was younger.
KENNY: Should the Prime Minister be singing the national anthem of another country or should the Prime Minister be singing the anthem of our head of state, I guess that is the same question?
WONG: We have our national anthem and we sing our national anthem. So I'm not quite sure what the point of Tony Abbott's little comment was. But we can respect the Queen and we can respect our head of state but also have our very clear views about Australia and whats best for the nation.
RIMINTON: Senator Wong, thank you very much again for your time this Sunday morning. Appreciate it.
WONG: Good to be with you all again.
ENDS