Campaign Transcript

TRANSCRIPT OF PRIME MINISTER KEVIN RUDD PRESS CONFERENCE CORNING CABLE SYSTEMS, CLAYTON 4 SEPTEMBER 2013 E & O E PROOF ONLY _____________________________________________________________ Subjects: NBN; Deloittes report on benefit of NBN to households; National Accounts; Roger Corbett; Car manufacturing industry; 457 visas; TAFE; Chinas economy. _____________________________________________________________ PM: Good morning everybody. Its great to be out here in Clayton, and in the great city of Melbourne, and the great state of Victoria, and were here at Corning, which has been an extraordinary partner with the Australian Government in rolling out the National Broadband Network. And of course I am here with our great candidate Clare who has been working hard in the field on behalf of the Australian Labor Party. She just told me by the way that she has a bub who is 12 weeks old, so have sympathy for what that must be like as a candidate in the midst of an election campaign. She is a first-class candidate. But we are here in this part of Melbourne because this is the heartland of what we are doing for the National Broadband Network nationwide. All these good people behind me and to the side of me are part and parcel of our partnership in rolling out the National Broadband Network. Making sure that the fibre optic cable is properly prepared, that it goes through the quality assurances necessary and that work as youve seen, as we have gone around the place today, is being done in a first-class manner. Also, if I could draw your attention to our plan for Victoria, which outlines our record of investment in the great State of Victoria, including most critically what we're doing in the National Broadband Network. In fact, if the National Broadband Network was not rolled out fully in Victoria following Saturday's election, you would have something in the order, I am advised, about 820,000 premises that would not be connected and that creates a digital divide in our community - which is wrong here in this part of Melbourne; its wrong across the city of Melbourne; its wrong across Victoria and it would be wrong across Australia. We want a National Broadband Network which is universal, which links everybody, the rich suburbs, small suburbs, suburbs in between, country and city with a universal

price at the wholesale level, to make sure every Australian has access to the information super highway of the 21st century. I draw your attention also today to a report which has been released by Deloittes and Deloitte Access Economics has in its own conclusions, in its own report, said that Australian households will be an average of $3,800 a year better off in 2020 thanks to high speed broadband delivered by the NBN. This is based on new research by them. I draw your attention to it. It runs through the impact of higher upload and download speeds on the efficiency of home-based businesses, but on top of that also, on saving time in conducting the normal affairs of daily life, which you can do increasingly online so long as your broadband has got high speed, its reliable and on top of that, has good upload speeds as well, not just download speeds. The bottom line for us on broadband is that we are offering fibre optic cable which provides you with download speeds of up to 1,000 megabits per second, upload speeds of up to 400 megabits per second and our opponents are offering a broadband system largely reliant on copper cable which would then provide download speeds of 25 megabits per second and no guarantee at all on upload speeds. The big efficiency driver for the future is what you can do in a home-based business in uploading that which you have done and zapping it around the world. That I think is part and parcel of the future. Let me talk more broadly about where broadband fits here in providing these jobs of these Australians who are out here working an honest days work for an honest days pay, and their jobs are important to me. My job as Australian Prime Minister is to make sure the jobs of all Australians are secure into the future and if transitions need to occur, that we help people move from one job to another. That is what we're on about. The economy and jobs and a fair go for all is what we're on about too when it comes to Australia's economic future more broadly. I draw your attention to the National Accounts data which has just come out. The National Accounts data is important because it underlines the continued strength of the Australian economy in a very, very uncertain global economic environment. Let me make a few basic comparisons clear for anyone who is paying attention to this broadcast this morning. And it is this - as of this year, since we came to office in 2007, the Australian economy is 15 per cent bigger than it was. That includes about a million extra jobs than we had back then in 2007. So, our economy over that six year period has grown at twice the rate of Canada, has grown at four and a half times the rate of the United States and six times the rate of Germany. Thats not a bad report card for an Australian economy in difficult global economic circumstances. So, weve grown 15 per cent over the last five to six years. I draw to your attention the fact that the British economy has shrunk 3 per cent over the last six years. Therefore, the economic credentials of this nation run by this Government over this period of time are strong. We now have had in Australia as a result of strong economic management, 22 years of continued positive growth in Australia - 11 under us put together, if you add

together the period under the Hawke/Keating Government and ourselves and 11 under the Conservatives. This is a good record for Australia. But here is a really important thing as well. It means therefore, if you're in the workforce, and if you're under 40 years of age, youve never experienced a recession. You have never experienced a recession - which looking around here means you haven't experienced one, you haven't experienced one, you havent experienced one and before I get myself into trouble, I don't think any one of you has experienced one apart from this gentleman taking the photographs. Sorry to pick on you. The bottom line is this, recessions are beyond the lived experience of any one in this country under the age of 40 years of age in terms of their own participation in the workforce. This is important because even if you cannot remember what a recession is like, bear in mind how easy it is to fall into one and the consequences of that occurring are dreadful for people, their jobs and their pay packets and their ability to deal with cost of living pressures. Which brings me to the national accounts directly. The Australian economy in the June quarter grew by 0.6, annualised growth rate of 2.6, which is consistent with the forecast which was put together for the statement of annual growth for 13/14 of 2.5. Given the global economic circumstances this is a strong achievement. But if you go to the internals of the 0.6% growth, the three main contributors to that growth are, number one: 0.2% increase in private consumption, 0.2% increase in total public investment and 0.2% increase as far as national inventories are concerned. These are important figures because of that 0.6% increase in growth for the June quarter, a third of it relies still on public investment and that brings me to the core point I want to make to you all today - public investment still, in these difficult global economic circumstances, is a fundamental part of keeping the Australian economy strong and in positive growth territory. Therefore pulling the plug on public investment prematurely by massive cuts, places continued growth at risk in the Australian economy. This is not a theory. It is a fact if you apply it to the centrality of how our current growth figures for the June quarter are put together. I draw your attention also to a recent article produced by Professor Joseph Stiglitz published, I think, in the Fairfax press on the impact of public demands now, or public investment now, on continued growth, and if you rip that away how easy it is to, in fact, starting to risk the possibility of heading into the negative growth zone. So we place an absolute priority on economic growth, on jobs growth and a fair go for all. What I fear is that Mr Abbott's Australia would be one where those who need help least, in fact get the most help. Thats what I fear his paid parental leave scheme would do. I also fear for an Australia that would be an Australia that would be divided in terms of its culture of work. I fear for an Australia that would be divided by a culture of conflict in the work place once more, if Mr Abbott were to take the knife to the Fair Work Act. But most of all, but most of all, I fear an Australian economy which

through Mr Abbott's massive cuts would risk triggering the economy into recession with huge hits on jobs and huge hits on growth. Thats what I fear most of all. And I underline the fact through the data that comes out through the National Accounts today. We are in very fragile global economic circumstances, very fragile indeed. And therefore we have got to be very careful about how we manage public investments contribution and total economic growth into the future. So I conclude with this challenge to Mr Abbott. Given that Mr Abbott has kept the details of his massive cuts a secret throughout this election campaign, then my question for Mr Abbott is to guarantee that his massive cuts will not hurt the economy, not hurt jobs and not risk triggering the economy into recession. It is a very direct question of Mr Abbott. He knows what the details of his massive cuts are. He knows how large they would be. I have explained today how critical all that is in terms of the total equation of economic growth and jobs. Therefore, if Mr Abbott just three days before an election is not going to provide us with the details of his massive cuts, then let me just put it in these terms. Mr Abbott, my challenge today is for you to provide a simple guarantee to the people of Australia that your massive cuts will not hurt the economy, hurt jobs or trigger a recession in the year ahead if you're elected. OK folks. Over to you. JOURNALIST: Mr Rudd, a moment ago you just pointed at me and said I hadn't experienced a recession. I'm 27 years old. What about Paul Keatings the recession we had to have of the 90s? PM: No, no, I was talking about people who are under the age of the 40 and I was simply pointing to the fact it is not in anyone's work experience therefore for 22 years. That is the simple point I was making. And therefore, that if you look across the country, people think about recession often as a technical economic term. People who have lived through recessions in their working lives know it to be a pretty brutal experience and the point I was making was that when people go into joblessness as a result of recession, often its very hard to get them back into the work force because the economy recovers slowly. Jobs are returned to the economy slowly. And sometimes what happens as a result of a recession is that people exit the work force altogether. Thats the point of my remark before. JOURNALIST: How would you classify your campaign (inaudible) PM: Thats a matter for you. JOURNALIST: (inaudible) And do you acknowledge that there are now people within the Labor Party and also people like Roger Corbett who think it would have been better to stick with Julia Gillard?

PM: Can I just say this - your job is to provide the analysis and the commentary. My job is to explain why we are rolling out the National Broadband Network. Why we are therefore in the business of making sure that we are turbo-charged for the economy of the 21st century and to explain how these good folks jobs depend on that. And if were asking questions today about the impact on real peoples lives, I am more concerned about what happens to these folks' jobs in the future than a rolling piece of political commentary, which is a legitimate fascination of a whole bunch in the Press Gallery, but I am more concerned about jobs, the future, schools, hospitals and the rest. JOURNALIST: Do you think that the people of Griffith who will go to the ballot box on Saturday deserve to know beforehand that you will serve out the full three year term irrespective of what happens on Saturday? PM: My intention is to continue to serve the people of Griffith as their Prime Minister. That is what I have said to them loud and clear and to engage in any other hypotheticals, I dont think is relevant to these peoples jobs, the rollout of the National Broadband Network or frankly the wellbeing of all the people who sit before you today. Let me tell you something more about the good people of my community. They are concerned about jobs too. They are concerned about their pay packets. They are concerned about whether they are going to get their broadband rolled out. They are concerned about the funding to the Princess Alexandra Hospital, the funding to the Mater Hospital. They are concerned about the local fifty or sixty primary schools who would benefit under the Better Schools Plan, much less so if Mr Abbott were to win. JOURNALIST: Is it appropriate for a Reserve Bank board member to make such politicised comment during an election campaign? PM: Thats a matter for the individual concerned. Its a free country. JOURNALIST: (inaudible) Roger Corbett is also the chairman of Fairfax. Do you take it to be further evidence PM: - Its a free country. As I have said before about Mr Murdoch its a free country, they can say what they like. JOURNALIST: (inaudible) Do you guarantee you will sit a 3-year term PM: I have answered that question before and to go beyond that, is to engage in a series of hypotheticals which I know youll be delighted to engage in but I dont propose to. JOURNALIST: Prime Minister, will you be thanking Julia Gillard for staying out of the election campaign and not being a distraction PM: - What I have said about Julia's contribution so far is that she has been a great contributor to the development of DisabilityCare Australia, the National Disability

Insurance Scheme. She is a passionate advocate of education reform and done well on that score. I draw to your attention her work on the Better Schools Plan, but beyond that also the work which she has done earlier on bringing about universal testing for schools in Australia as well. JOURNALIST: You are going to Adelaide today, a big car manufacturing town, official car sale figures for August are being released today and they show new car sales have dropped by 0.2% compared to August 2012. Given the market was growing at 5% in the first six months of this year before the FBT announcement, has the FBT changes been a mistake and do you regret making the change? PM: First thing Id say, is that if you're concerned in Adelaide and South Australia about the future of the car industry, then you should continue the pattern of previous Australian Governments of co-investment. Thats what Im passionate about. That is why we have a record of some $1.2 billion of additional investment, co-investment commitments, from us compared with Mr Abbott. So if you ask the people of South Australia about the future of their car industry, I believe they would ask this - who is getting behind their industry and who is not? Who regards it as an industry of the future and who doesn't? And when it comes to a quarter of a million jobs, either directly in the manufacturing of motor vehicles and including 200,000 within that quarter of a million, of those who are in the parts and supply industry, I take their jobs seriously. And the bottom line is this, unless you have that co-investment into the future, at levels of support vastly less than goes to other economies in the world, like Germany and the United States, then there won't be a car industry in the future. So its very simple. We believe in the future of the car industry in Victoria and in South Australia, the car manufacturing industry. We believe in the importance of it as a generator of jobs nationwide. And on top of that, we also believe it is important to be co-investors in that industry's future. My experience of car sales data is that the first and primary condition associated with that is whether in fact youve got a viable domestic car industry, a strong economy where jobs are growing so that people have the confidence to purchase cars and with appropriate tax support. JOURNALIST: Just on where we today, (inaudible) is there a sign that the NBN rollout is too slow and I dont have any figures on this, but I am just wondering how much reliance there is on this skilled work on 457 visas and if that makes you reconsider Labor's crackdown in that area? PM: First thing Id say is that we are proud of everything that has been done here by these good folk at Corning. Its a great company. And we are happy to be partners with them and providing jobs here in this local community, but more importantly, people watching this today would perhaps be puzzled by some of the sense of priorities being put forward by others. I can't think of anything more which will transform peoples work places and their home lives than broadband over the next 10 years. It is a central galvanising question for Australians.

And what we have here is this unique historic opportunity to complete a national rollout of a genuine National Broadband Network depending on fibre optic cable which revolutionises the future. That is a massive project. It is a nation transforming project. It is providing massive employment nationwide not just in the manufacturing or the assembling of this sort of cable here, but also in the rollout phase right across the country as well. But the new jobs, the new opportunities coming off the back of high speed broadband will be phenomenal. In fact, already in certain cases are phenomenal. JOURNALIST: You say you don't want to engage in hypotheticals PM: Thats correct. JOURNALIST: But potentially the whole election campaign is a hypothetical. You talk about PM: Im not going to respond to the one you are going to point to. JOURNALIST: You talk about what will happen if Labor is elected or if Tony Abbott is elected, so don't the voters of Griffith deserve to know whether they will be headed to a by-election if Tony Abbott wins? PM: I just indicated before that my intention is to continue to serve the people of my community as their Prime Minister subsequent to the election. That is what I am engaging in in this election for, not just to serve them locally but with their support and the support of other Australians to serve them nationally. Again I go back to the point that one of the reasons, one of the factors which will be in peoples minds when they vote on Saturday will be the strength of the economy. Here we are on National Accounts day and I haven't heard a question yet on the National Accounts, and I would have thought that whether the economy is in recession or not and generating positive or negative growth might be an important question for all Australians. Because that means whether employment is growing, it means whether in fact we are going to generate enough economic activity in the future to continue to grow jobs into the future, and on top of that, whether pay packets will be there to provide food and provisions on the home table as well. So we are out there arguing the case for strong economic management. And I go back to my core proposition that I put to you before when it comes to national economic growth - and its very simple - that on the growth of this economy, our plans for how we do that in the future are out there for all to see and we have sustained six years of positive economic growth despite all the challenges in the global economy which some people seem to be quite happy to just brush away as if they never happened. But our bottom line is this, we have kept this economy out of recession and so therefore what I fear most of all is if the consequence of Mr Abbott's massive cuts, his hidden massive cuts impact the health of our economy, our jobs and run the risk of triggering recession.

This is a very difficult global economic time and when you look at the difference between an economy remaining positive and slipping into negative territory, those three drivers of growth I referred to before depend a large part on public investment. Public investment equals whether in fact Government is spending or Government is contracting. Mr Abbott's talked about massive cuts. Where all that leads is whether youre having a press conference in a year's time if Mr Abbott is elected and saying well what happened with those cuts? Did you just repeat the mistake of the British Conservatives and accidentally trigger a recession which resulted in large-scale unemployment. JOURNALIST: Just on the second half of the other question, do you continue to stand by your 457 visa crackdown? PM: Can I just say if you look at the detail of the Governments 457 legislation what it does say? JOURNALIST: Well it has tough compliance for employers, a percentage of payroll going towards training and labour market testing, it makes it more difficult.. PM: What It says you simply need to effectively advertise and market test locally. That is a fair thing. All Australians believe that these things should be tested locally so we make a simple judgment about what skills exist locally, what do not and therefore what would need to come from abroad. It is a very simple test. But one which needs to be properly observed and properly monitored. And we have no problem at all with when folks come to this country on appropriate visas to work, when those skills can't be accessed locally. Thats a very, very simple thing. And if you look at the overall balance of these things over time, it is a remarkably open economy when it comes to people coming here to work from abroad. Look for example at the current size of our official migration program. Look at the current size of those who come here on working holiday visas. Look at the size of the quota of those who come here each year on a range of student visas with work entitlements as well. Then look at those who come here with other short-term work visas as well. This is a very open economy when it comes to people's ability to work here and come to contribute to growing the great Australian economy. And so the balance which is reflected in our legislation on 457s I think is there for all to see. JOURNALIST: On the global economy PM: - Hey! A question on the National Accounts, hold the phone. JOURNALIST: The US Federal Reserve is accelerating its plans PM: - OK its not a question on the National Accounts JOURNALIST: - And the most recent manufacturing data out of China, the PMI actually shows it is improving. How fragile actually is the global economy and secondly, on Sunday you promised to protect TAFEs from State Governments cuts but you removed $111 million from TAFE funding. How do you justify that?

PM: I think if you look at the question of TAFE outlays and the period that -and a fair shake of the sauce bottle there mate - over the last five or six years, our total increase in vocational is education and training outlays is up by about 25%. Let's just put that into context while the Government of Victoria seeks to reduce its outlays when it comes to TAFE and there has been a huge debate locally about that. I see the same in Queensland, where something like 11 TAFE campuses are in the process of being flogged off and TAFE teachers are copping it in the neck and by the Liberal Government of Western Australia and the policy, so that you understand it in three parts is this number one, because we are providing something like $7 billion each year in vocational education and training payments to the states, it is not unreasonable for us to ask them will you maintain your effort and increase it, rather than take money from us with one hand and withdraw their own effort from the other? Number two, if you can't demonstrate that by July next year, why not and is it not unreasonable for you then be in a position where we, the Australian Government, negotiate individual contracts with individual TAFEs to be guaranteed that what we are spending is actually delivered within the TAFEs. Number three, if by 2015 the states and territories get in the road of all of that, then our policy is to take that $7 billion worth of investment currently going in the state's hands one hand and sometimes being, shall I say, offset by reduced state outlays on TAFE in the other, and invest in our own TAFE Australia network. That is our policy. I think it is exactly the right direction. When I go right across the country, yes and I am going to come to the global economy now, and I think it is exactly right direction because you can't have a strong university sector which we have invested in massively over the last five or six years and have a weakened TAFE sector because the states are prepared to simply see it wither on the vine. Some State Governments are doing the right thing and others are not. On the strength of the global economy, we can pick a month's data here and a months data there. If you're to look at the PMI index in China over the course of the last six months and you follow it through the Financial Times and elsewhere, you know where the datas been going, and therefore when it starts to improve from a lower base, we know that things have been of some difficulty in China. The reason why we have a particular set of difficult global economic circumstances for Australia is this - because the China trade is so massive for our economy, an economy at $1.5 trillion, correct me if I am wrong, we have a $100 billion plus in terms of the China trade and therefore it affects jobs and wealth everywhere in Australia. If there is a weakening of the Chinese growth projections from 8, to 7.5, to 7 or even 6.5 and you have a lessening demand for Australian energy and resources, it flows through to the entire Australian economy. You have heard me speak on this throughout this campaign which is why we need to diversify the economy and invest in other industries to create the new jobs of the future as well. And that precisely is what we are doing. Having said all of that folks, I think it is time to head off and zip.

ENDS