Andrew Leigh

On Sky AM Agenda, I joined host Kieran Gilbert and Liberal Senator Mitch Fifield to discuss the Coalition's excuses for blowing out the budget, and whether Liberal Party MPs will be given the freedom to vote their conscience on same-sex marriage.

E&OE TRANSCRIPT
TELEVISION INTERVIEW

SKY AM AGENDA WITH KIERAN GILBERT

MONDAY, 16 DECEMBER 2013

SUBJECT/S: Budget Update, DisabilityCare, Same-Sex Marriage

KIERAN GILBERT: First though to Andrew Leigh. The Budget apparently worse than first thought, according to the Government, and we could be heading towards ten years of deficits unless some drastic action is taken.

ANDREW LEIGH: These are some big decisions that the Government has taken, aren’t they Kieran? The $9 billion to the reserve bank, the $17 billion of revenue you lose when you get rid of the mining tax and the carbon price. The impact of those on the budget is going to be very, very significant.

GILBERT: But Tony Abbott says this is the last economic statement of the Labor era, isn’t that a fair enough assessment given we’re only 100 days since the election?

LEIGH: I think that’s a great try on and given where Mr Abbott’s coming from you can understand why he is giving it a good old shake. Unfortunately, Peter Costello’s…

GILBERT: But only three months in how can it not be Labor’s legacy that we’re talking about here?

LEIGH: Well because unfortunately for Mr Abbott we’re playing by Peter Costello’s rules. Those rules say that there is a Charter of Budget Honesty and a Pre-Election Fiscal Outlook brought down during the election campaign, that lays out exactly the state of the books at the time that the election takes place. And the reason that Peter Costello put those rules into place was very simple, it’s to avoid exactly this kind of trick. The kind of attempt to find spiders in the cupboard that Mr Abbott’s been going on with and Mr Hockey as well. Frankly, this is a MYEFO and much as Joe Hockey would like to think that it’s a ‘Your EFO’ or ‘Wayne’s EFO’ or ‘Someone else’s EFO,’ this is a statement of the decisions he’s made.

GILBERT: I’m told we’ve got the assistant social services minister, Mitch Fifield with us now. Senator Fifield, good to see you and let me ask you first of all about this suggestion. Well, first of all Tony Abbott’s saying that this is Labor’s last economic statement of its era, but he’s refusing to commit to returning the budget back to surplus within four years. Is that on, or is it off? That commitment to have the budget back in surplus by 2016-17.

MITCH FIFIELD: Well Kieran, our objective is to get the budget back into surplus as soon as we can. Our objective is to pay off as much debt as we possibly can, as soon as we can. The real issue here is whether the Australian Labor Party are going to recognise that there has been a change of government, and if the Australian Labor Party are going to stand in the way of each and every measure proposed to get the budget back into a sustainable position. So far we have seen the Labor Party announce that they will oppose even the savings measures that they themselves announced before the election. This is truly perverse stuff Kieran, but our objective is we want to get the budget back into surplus as soon as we can.

GILBERT: Well, so is that another target that’s gone by the wayside Senator Fifield?

FIFIELD: Well Kieran the targets of the Labor Party, and we saw many of them during their term of office, budget after budget not one of them was met. I lost count of how many targets the previous government set for when they would get the budget back into surplus. They were forever moving, they were forever changing – so you’ll forgive me if I’m not going to cop lectures from the Australian Labor Party when it comes to budget targets, but what we know at the moment is that on Labor’s own numbers from the PEFO, from the numbers from Treasury and Finance at that time, the budget was looking to be 30 billion dollars in deficit, we know that Labor were forecasting net government debt in excess of 200 million dollars. Now we will find out tomorrow with the MYEFO whether those numbers have gotten worse, and I think Tony Abbott is quite right to say that the MYEFO will in effect be the last budget statement on behalf of the previous government, but it will be the first truthful one.

GILBERT: Minister, can I ask you as the minister responsible for the National Disability Insurance Scheme, is the NDIS safe from cuts despite the worsening budget forecast?

FIFIELD: Kieran we have made clear, and I’ll state it again to you that we will honour the announced spending on the NDIS. We are, even as I speak now, in the process of honouring and delivering the bilateral agreements that have been reached between the Commonwealth and the other jurisdictions. Tony Abbott is very personally committed to seeing the NDIS delivered and that’s what we’re going to do.

GILBERT: And on time, on schedule, as promised?

FIFIELD: Kieran we are honouring, and it’s our intention to do so, the bilateral agreements with the other jurisdictions and they lay out the time frame.

[Break for Prime Minister’s press conference.]

GILBERT: With me this morning, Andrew Leigh and Mitch Fifield. Much smaller discussion than what we’ve normally got, of course because of the Prime Minister’s news conference, but he says tomorrow they’ll be starting to outline the fiscal problem and start to fix it. The economic ramifications of decisions made by Labor will remain. As an economist, isn’t that a fair enough argument? Decisions made in government are obviously going to have ramifications for years into the future. It can’t be fixed overnight.

LEIGH: Well, the budget was set down before the election. The Pre-election Fiscal Outlook is the baseline that Mr Abbott’s inheriting. I mean, let’s face it, Mr Abbott said this would be…

GILBERT: But it’s got worse. It’s $17 billion worse already.

LEIGH: Indeed, Mr Abbot has worsened it through a number of decisions including $9 billion to the Reserve Bank.

GILBERT: So you’re saying as soon as the election’s done, Labor’s legacy is over. There are no ramifications into the new government.

LEIGH: None beyond the four years of estimates that were set out in the Pre-election Fiscal Outlook. I mean for a government that said there would be no surprises and no excuses, there’s more surprises than a haunted house and more excuses than a three year-old with his hand in the cookie jar. This is really strange stuff. Mr Abbott ought to be behaving like a grown up. He said this would be a government in which the adults would be in charge, but instead he seems to be suggesting that everyone else is to blame. He can’t get the budget under control, so he has to strike a deal with the Greens for unlimited debt. He’s breaking promises on the National Broadband Network, on Medicare Locals, turning the National Disability Insurance Scheme launch sites into mere trial sites – which I think is deeply concerning. What was a budget emergency has turned into unlimited debt under Joe Hockey’s watch.

GILBERT: I want to bring in Mitch Fifield now. We heard a lot from the Prime Minister on the economic issue, I want to ask you about something he was also asked about on same sex marriage Senator Fifield. Given the comments made by Malcolm Turnbull yesterday – he thinks that there is a reasonable prospect there could be a conscience vote for the Liberal Party this parliamentary term on same sex marriage. What’s your view on it? What do you think the overall mood of the party room is on this issue?

FIFIELD: Well, if a Bill comes before the Parliament, our party room will consider it and I think we need to distinguish between the issue of conscience votes and free votes. In a sense, every vote in the Parliament for a Liberal is a conscience vote. Unlike the Labor Party, we don’t have automatic expulsion if you don’t vote according to the party line so every vote for a Liberal is in effect a conscience vote. There’s the issue of free votes. Now a free vote arises where the Party doesn’t have a stated position, and for there to be a free vote in relation to a same sex marriage bill, our party room would need to declare that there was not a Liberal Party position, so if a bill comes to the Parliament, it will come to our party room and our party room will consider that at that stage.

GILBERT: And obviously, do you have a view one way or the other on whether it will or not? We’ve only got about 30 seconds left, but just quickly.

FIFIELD: Look I honestly don’t know. Our party has had a clear position over a long period of time to support the status quo when it comes to the Marriage Act. This matter, if it arises, will be considered by our party room.

GILBERT: Senator Fifield and Andrew Leigh, apologies for the shorter discussion but, as I say, the Prime Minister intervened.

LEIGH: No worries Kieran.

GILBERT: Have a good day. That’s all for our chat on this edition of the program this morning.

ENDS

Today I issued a media release highlighting how Labor's concern about an ATO draft ruling on moveable homes is catching on. Several Coalition MPs, including the Assistant Employment Minister, Luke Hartsuyker, have complained about the draft law which if adopted would make the supply of a moveable home site taxable and hurt low-income people.

MEDIA RELEASE


COALITION MEMBERS BREAK RANKS ON GST TO MOVEABLE HOMES



Government MPs are breaking their silence to speak out against moves to slug moveable home estates with GST, said Assistant Shadow Treasurer, Andrew Leigh.

“Karen McNamara, the Liberal Member for Dobell, is the latest member to criticise the Australian Tax Office’s draft decision on moveable homes.”

She told Federal Parliament yesterday:

I have been contacted by members of my community who live in moveable home estates and the message is clear, this draft ruling unfairly impacts on those who can least afford to pay more tax. – Karen McNamara (Member’s Statement, Thursday 12 December 2013)



“Since Labor Leader, Bill Shorten first raised this issue on 9^th November a plethora of Liberal and National MPs have broken ranks to express their concerns on behalf of hundreds of moveable home owners, many of them pensioners who can’t afford conventional housing,” said Dr Leigh.

“By contrast, the Prime Minister - who promised a Coalition Government would make no changes to the GST - said in relation to this unfair ruling that ‘things happen’. The Assistant Treasurer says it’s merely an ‘administrative decision’ and the Treasurer has said nothing.”

"As with Holden, Joe Hockey seems to think that doing nothing is the best approach," said Dr Leigh.

“It’s time senior government leaders took notice. Did they hear Liberal Member for Cowper, Luke Hartsuyker, argue for the draft decision to be overturned?”

My concern is that many people living in moveable estates simply cannot afford any other form of home… I have concerns that this decision will increase the cost of living for those who have least capacity to pay.” – Luke Hartsuyker (Media Release, 5 December 2013).

The Nationals Member for Page, Kevin Hogan, and the Liberal Member for Forde, Bert van Manen, are among other Coalition MPs who have spoken out after being inundated with requests for assistance to fight the proposed GST hike.

Ends

Friday, 13 Decemnber 2013

I spoke in parliament today on the High Court's decision on same-sex marriage.

Today the High Court unanimously decided that the Marriage Equality (Same Sex) Act 2013 of the ACT could not operate concurrently with the federal Marriage Act. This judgment was the result of a decision by the Abbott government to challenge the ACT law in the courts. It is a decision which I believe was fundamentally misguided. Same-sex marriage is a political issue that should be decided in this chamber. As the Prime Minister's sister, Christine Foster, has tweeted: 'Sad news that the ACT same-sex marriage law has been overturned. Focus now firmly on federal parliament.'

Many members of this place support same-sex marriage, but the challenge is that the Liberal Party does not give its members a conscience vote. If Senator Brandis puts out press releases making statements such as, 'Freedoms are some of the most fundamental of all human rights', then the least he could do would be to allow his party room the freedom to vote for same-sex marriage.

As Warren and Grant of Aranda, who have been together for 27 years, told me: 'Our marriage would not undermine heterosexual marriage—quite the opposite—our desire to be married reflects our deep respect for the institution of marriage.'

Future generations of Australians will look back and wonder why it took Australian parliaments so long to bring about the reform of marriage laws.

This afternoon I spoke to ABC Canberra 666 host Alex Sloan about today's High Court ruling against the ACT's marriage equality legislation. Listen here.

ACT Federal Labor members also issued a joint statement expressing disappointment and urging the Prime Minister to bring the debate to the floor of the Parliament. While the High Court found the landmark ACT law unconstitutional, the Court also stated that ‘marriage’ in the Australian Constitution includes a marriage between persons of the same sex. This means that the Parliament can legislate for marriage equality.

JOINT MEDIA STATEMENT



Federal Labor Members in the ACT

Andrew Leigh MP, Member for Fraser
Gai Brodtmann MP, Member for Canberra
Kate Lundy, Senator for the ACT

CALL FOR TONY ABBOTT TO ALLOW SAME-SEX MARRIAGE CONSCIENCE VOTE


We are very disappointed with the decision today by the High Court to strike out the territory’s same-sex marriage law.

This is a sad day for those same-sex couples that took advantage of the ACT’s ground-breaking legislation and tied the knot since Saturday.

We commend ACT Labor on its efforts to advance the cause of equality.

We also respect the decision of the High Court.

The Prime Minister must now deliver on his pledge that the Liberal Party room will revisit the question of whether to have a conscience vote on same-sex marriage.

The Abbott Government chose to mount this legal challenge at a cost to taxpayers when this is an inherently political decision that should be decided in the Federal Parliament.

ABC 666 Canberra Afternoon interview 12-12-13

Stretching the brain in different directions, this morning I had a laugh with ABC 666's Ross Solly and Jo Laverty about the classic Dead Parrot sketch by Monty Python. Here's the chat and here's the link to the skit.

ABC 666 11-12-13

Last night I delivered a speech in Parliament commending members of my electorate for the quality and quantity of their social and volunteer interactions as well as the great work of our young social entrepeneurs:

I rise tonight to speak on the strength of community in my electorate of Fraser. As is well known, the ACT has some of the highest rates of social capital in the nation. The most generous postcode, as measured by tax deductible gift donations, is 2602. The highest rates of volunteering of any state and territory are in the ACT. The ACT also has high rates of sporting participation, community club membership and even, according to the Clean Up Australia Day survey, low rates of litter.

Australians may have become disconnected over recent decades, but Canberra is a strongly connected city. Last Thursday, it was my pleasure to attend Volunteering ACT's Volunteering EXPO held in Albert Hall. The Volunteering EXPO brought together a plethora of ACT community groups, each looking for new volunteers. Ninety per cent of ACT voluntary groups say that they want more volunteers. It was a real pleasure to stroll the through the halls set up, as it were, as an Easter show of giving back to the community. Many of the local groups I spoke to had already signed up volunteers and were hoping to do so the following day.

I acknowledge the hard work of Maureen Cane, Rikki Blacka and Emilie Van Os Schmitt, from Volunteering ACT for their tireless efforts over recent weeks to make the volunteering expo a success. Volunteering ACT have been hard at work on other products as well. They recently produced a report, Promoting youth engagement and wellbeing through student volunteer programs in ACT schools, which I would commend to the House. Generating that culture of volunteering is so vital because volunteering, like so many other things, such as the habit of giving something back when one is at school, is indeed important work.

Volunteering ACT has also put together a booklet called 100 Volunteer Stories, compiled by Sarah Wilson and Emilie Van Os Schmitt. That book discusses so many of the great Canberra volunteers: Marjorie Boyer and Sheila Turner of Palliative Care ACT; Ian Goudie of Diversity ACT; the Railway Historical Society and its project to restore old trains; Cathy Starling and Judy Tier's stories of their involvement in Australian Business Volunteers, assisting developing countries to foster entrepreneurship and innovation; Ricardo Alberto and his hard work as President of the Gungahlin United Football Club; and the voluntary work that makes Volunteering ACT itself such a success.

I was also pleased on Friday to host one of my regular social entrepreneurs breakfasts where I bring together in my electorate office a set of social entrepreneurs who are doing good work in the local community. It is born out of a sense that I have and which, I believe, many members on both sides of the House share, that Australia needs more innovation and entrepreneurship. One area in which I believe I, as a local member, can do something to promote that is in bringing together local social entrepreneurs. They are an inspiring group, working on issues that are wide and diverse. Those who were able to attend Friday's social entrepreneurs breakfast included Julia Diprose of Vocal Majority; Pierre Johannessen of Big Bang Ballers; Brad Carron-Arthur, who runs a mental health organisation; Tony Shields, who is involved with Menslink; Ben Duggan, the founder of Raising Hope; and Danielle Dal Cortivo, founder of raize the roof.

I was also grateful to Fiona Nelson and Lincoln Rothall of WIN News for providing some opportunities through this breakfast to promote some of those great voluntary organisations in the local media. These organisations are inspiring and it is important that these social entrepreneurs have an opportunity to discuss with one another the shared challenges that they are facing: setting up a board, finding appropriate funding, managing the organisation in such a way that they do not burn out in their personal lives; thinking about who will succeed them in running their organisations; and thinking, too, about appropriate partnerships.

The strength of Canberra's community extends to its technology entrepreneurs. On the weekend I popped into Hackathon ACT, an IT boffin's delight held in the entrepreneur space, Entry 29, on the edge of the ANU campus. There I spoke with Rory Ford and Matt Stimson, who took me around the room and introduced me to various of the bleary-eyed entrepreneurs—this was early on Sunday afternoon and many of them had pulled an all-nighter all through Saturday. Caffeine was in abundance as was junk food. It was terrific to see the community of programmers and the innovative ideas they were working on. A team from one of the local schools was working on an app for Google Glass. I had not even realised that Google Glass was available in Australia, but they were not only using it but also developing a new app for it. There was a group working on an app for mortgage comparison. and another one working on an application for better form filling in order to save time for large organisations and indeed for government, cutting down on the amount of forms that have to be printed and reducing the amount of time that we spend queuing.

Finally, I recognise the sense of holistic pride that the ACT government has brought through its Brand Canberra campaign. Launched on 28 November, it features a new logo—CBR, standing for confident, bold and ready. It provides a framework through which to tell Canberra's story through five attributes: challenge, free spirit, ideas, quality of life and discovery. That positive message is one I believe pervades community groups in the ACT. It is not just a new logo, as the Chief Minister and Deputy Chief Minister have acknowledged. As Chief Minister Katy Gallagher put it, it is also something that:

… gives us the tools to be able to tell others what a great city Canberra is—proud to be the capital of Australia and the centre of government, but also a confident and bold city.

The campaign has been praised by the ACT Chamber of Commerce and Industry and by the chair of the Canberra Business Council, Michelle Melbourne. I acknowledge too the work of Jamie Wilson and Warren Apps of Coordinate.

Too many Australians think of Canberra as being just the city of government, but it is in fact not just the national capital; it is the social capital of Australia. It is a place where voluntary organisations thrive and can thrive even more still. I pay tribute to the many volunteers here in the ACT and the organisations that sustain them.

Yesterday I joined parliamentary members in expressing sadness over the passing of the former South African President, Nelson Rolihlahla Nelson. I gave this condolence speech:

Richard Stengel, who worked with Nelson Mandela on his autobiography, told the story of when he was out walking one morning in the Transkei with Mr Mandela and they spoke about when he would be joining his ancestors. Mandela said:

Men come and go. I have come and I will go when my time comes.

He had an extraordinary life. The first time he shook the hand of a white man was when he went off to boarding school. He was born into a relatively privileged family by black South African standards. He grew to stand six foot two and he had a strong education. Nonetheless, when he was a young man in Johannesburg people spat on him in buses, shopkeepers turned him away and whites treated him as if he could not read or write. He thought to himself that, if that was how he was treated, how must it be for so many other black South Africans?

He was tried for his revolutionary activities for the ANC and sentenced. In the sentencing hearings, he spoke for four hours, finishing with the final statement:

During my lifetime I have dedicated myself to this struggle of the African people. I have fought against white domination, and I have fought against black domination. I have cherished the ideal of a democratic and free society in which all persons live together in harmony and with equal opportunities. It is an ideal which I hope to live for and to achieve. But if needs be, it is an ideal for which I am prepared to die.

His defence team urged him to take out the last sentence for risk of antagonising the judge and, as history has suggested, it may have been a close-run thing. Another member of the Johannesburg bench claims that he persuaded the trial judge, Quartus de Wet, to change his mind over a cup of tea in the judicial common room just before he returned to the court for sentencing: de Wet had been set on hanging.

The 27-year sentence saw Nelson Mandela become prisoner 466/64. He was held for 18 years in an eight-foot by seven-foot cell. It was a brutal sentence. He was a man who loved children but spent 27 years without holding a baby. As was reported, when he was being pursued by thousands of police, he secretly went to tuck in his son in his bed. When his son asked why he could not be with him every night, Mandela told him millions of other South African children needed him too. He lost his eldest son, Madiba Thembekile, in a car crash in 1969 and felt terrible guilt.

Mandela did not eschew violence entirely, as Gandhi did. He said, 'At a certain point, one can only fight fire with fire.' He never disowned the struggle and he was the founder of Umkhonto weSizwe, the Spear of the Nation, the military wing of the ANC. He regarded violence as a tactic not as a principle. As my media adviser, Toni Hassan, has pointed out, Mandela reached a point of taking the view that violence was a necessary strategy. But when the time came, he said to the ANC:

We must accept that responsibility for ending violence is not just the government's, the police's, the army's. It is also our responsibility.

This was most difficult when Chris Hani was killed by an assassin commissioned by the right-wing conservative party. It was Mandela who called aggrieved black South Africans not to take revenge when the country could have been plunged into bloodshed. He noted that a white woman of Afrikaner origin risked her life so that 'we may know and bring justice to the assassin'.

When Mandela was released from jail, almost a generation had passed. It was said that when he saw a television soundman waving a boom microphone at him he thought he was 'wielding a fancy assassination device'. But Mandela brought black and white South Africa together as the first president of a multiracial South Africa. In the moment when the country hosted the 1995 Rugby World Cup, Mandela wore captain Francois Pienaar's No. 6 jersey on the field. The crowd loved it and loved him. They experienced a great moment of unity.

I am very pleased to see the bipartisanship with which Nelson Mandela has been acknowledged, but it is important to note that this was not always so. When people like Meredith Burgmann protested against white-only South African sporting teams, she was attacked by many Australian conservatives. Reading through the Hansard reveals John Howard opposing sporting sanctions against South Africa in the 1980s and Michael Cobb calling in 1990 for the resumption of sporting contact with South Africa. It also reveals Liberal members calling for the expulsion of the African National Congress from Australia and people like Senator Crichton-Browne saying:

When Mandela gets out of gaol he will be just in the ruck with all the rest. As long as he is in gaol he really is a symbol of all that the blacks represent. The sooner he gets out, the sooner, in my view, his influence will be considerably diminished.

One is so glad that those words have been consigned to the dustbin of history. There was a great moment in that speech when Senator Crichton-Browne said:

No one, in my view, has an absolute mortgage on morality.

And the late John Button said:

Certainly not you, Senator.

Mandela was a towering figure the likes of which we may not see again. His example to all of us was an extraordinary one. We are lucky to have shared this planet with him for that great run of 95 years he was on it. May he rest in peace.

I joined erudite Drive host Richard Glover, Reserve Bank board member Heather Ridout and former Liberal leader John Hewson for a wide-ranging discussion about government suport for Qantas and General-Motors Holden, climate policy, the 30th anniversary of the floating of the dollar, remembering Nelson Mandela and the importance of tenacity. Here's the ABC 702 audio to listen to. The transcript is below.

Glover: Monday’s political forum Heather Ridout, Reserve Bank board member and former head of the Australian Industry Group, Dr John Hewson former Liberal leader of course and economist and Andrew Leigh, the Labor member for Fraser and the Shadow Assistant Treasurer is also a former professor of economics at the ANU. Andrew welcome to you in Canberra.

Leigh: Thank you Richard.

Glover: And Heather and John welcome to you here in Sydney. Now both QANTAS and General Motors Holden are in the sort of trouble that leaves them vulnerable if not given some sort of government help. So is it a case of the tax payer to the rescue yet again, or do we let such icons sink or swim? Heather Ridout.

Ridout: Thanks for that one.

Glover: Just a hot-ball-pass straight to you.

Ridout: Look, I think both QANTAS and Holden are in similar but different places. Both operating in, their Global players in a Global economy, playing in a global economy with high cost structures and that makes it very hard. But that's where the similarity ends. I mean I think QANTAS wants to be very careful people don't get the wrong impression. It’s a very strong company with a very strong asset base with a very strong balance sheet.

Glover: Their making $300 million dollars also.

Ridout: Yeah and they've got plenty of cash, and yeah, well they are. You know I think that's an issue they've got a lot of options to solve and I think in the airline act restricts their ownership that's one structural issue government can do something about. But they do have options internally and this is an important period in their history. But people shouldn't be concerned about the future of QANTAS.

Glover: Before you go on to Holden should the government liberalize that foreign ownership act?

Ridout: Well I think they should have a look at it. I'm very pro-foreign investment and I think this is one area where business needs to show a bit of good leadership. Australia wouldn't be the country it is if it wasn't for foreign investment. We've always wanted to spend more than we save here and we want to continue to do that because that's given us high living standards etc.

Glover: Okay some people say airlines are different because there's a deference issue about having a national carrier who can help you out in times of trouble.

Ridout: Well I think an awful lot of countries have made that argument but I'm sure there's other ways to skin that cat. But I mean we can still retain a strong interest in the airline and that's only one option. But I don't think, Holden doesn't have those options. I was on the advisory board for Holden for quite a few years. It’s a fantastic company, whenever manufacturers wanted to find a process engineer or a person who knew about innovation… they went to the automotive industry and they still do. Because that's been the hub of innovation, skills, development you name it. But I think there's a much greater ambivalence about the government  racing into put more money on the table because people are very concerned the viability of the industry in Australia.

Glover: In other words we might be throwing good money after bad.

Ridout: Yeah, I mean we only make about 200,000 cars now and if you look at a global scale car manufacturer that's a pretty moderate size one plant. But then again I'm very worried that the economy is not that resilient at the moment. To absorb all these people, and there'd be 50,000 direct people that would be affected by this decision. 15.000 or so in South Australia and the average age of the worker in manufacturing, 20% of them are over 55 and you have to wonder whether these people are going to find more opportunities. Whatever government does it shouldn't be about saving money  in the short term, it shouldn't be about short term politics, it should be within the context of a very strategic framework about what they’re going to do about those issues.

Glover: John Hewson, are we throwing good money after bad? Does the tax payer need to come to the rescue with these companies?

Hewson: Well in terms of Holden, I mean it’s been on the cards for a long time. I remember answering these questions in the early 90's saying that we'll probably end up wasting billions of dollars and it will end up in tears anyway. It's an inevitability given it’s a global business as Heather said, the decisions are not made in Australia with Australian interests at heart really. So I think what you need to do is look at the reality that it is going to go, and the transition for that which Heather's actually mentioned in terms of some of the problems with older workers and so on. You can argue that they've all known about it for quite some time but nevertheless the government could play a part in facilitating the transition away. And preserving the design and engineering skills that underline the motor industry in some form.

Glover: Is that possible? See some people would say that if you want the motoring industry to do what it’s been doing over the last 40 years which is to provide this training and this sort of basin this knowledge of engineering at the heart of the economy that's difficult to replicate in any other way.

Hewson: It may be true but I’d have to say that the Australian population has moved against Australian made cars anyway. I think we've got more models per capita than any other country in the world and there tastes have shifted away from Fords and Falcons and Commodore's.

Glover: I was told we've sold 98,000 cars this year to date. 12,000 of them were in Australia. The rest of them imported.

Hewson: Yeah and this is making the point, so you are in that sense you are throwing good money after bad. Trying to just save them, give them another 150 years which I thought one proposal was today, which you know is not going to achieve the result. The decision I would guess has been made on global considerations. You source the parts, you source the people, you source the processors in the cheapest location that gives you the product you want. Globally they are going to do that and they've been doing that in the car industry for a long time. A car is a global product not a national product whatever we might like to think.

Glover: If that's a hopeless cause what about QANTAS?

Hewson: QANTAS is difficult because I mean it’s an icon there's no doubt about it and there're arguments about it, but I personally think QANTAS has been very badly managed over a long period. I mean there were opportunities back it the 80's I believe the link QANTAS or merge QANTAS with Cathay pacific, which would've given us a really genuine, significant Asian-based airline ahead of everyone else, ahead of Singapore, ahead of Emirates and so on. Which would've been a very good opportunity, and it’s still probably there. You could change the foreign investment restrictions and allow someone like Singapore or emirates to buy 25% of QANTAS for example. But the value of QANTAS is not reflected in its share price, I mean Heather's right its inherent value its breakup value is much more than the share price. So, there's a lot of options internally that they could pursue?

Glover: You mean if they sold Jet Star or they sold frequent flyer?

Hewson: Yeah and focus their activities more directly. You know I guess that, I remember Alan Joyce a year or so ago when his bonus was in question because it had been tied to the share price. The share price had collapsed and he was still arguing that he still deserved a bonus even though the share price had collapsed. Those sorts of things actually leave a lasting a lasting taste in your mouth, and then you turn around and ask the tax payer to bail you out. When your borrowing status is junk status and you ask to government for a triple A borrowing status, I mean you're asking an awful lot. I don't think that should be perused and I don't think putting cash in or the government buying shares is sensible. But perhaps easing the foreign investment restrictions and allowing them to link sensibly with another major regional global airline would make a lot of sense.

Glover: Andrew Leigh your side of politics has said firmly no today to that idea of loosening the foreign ownership requirements on QANTAS.

Leigh: We have Richard and our view is QANTAS ought to remain a majority Australian owned Australian Airline. It’s the national carrier it’s one that I think Australians are pretty proud of and so we've taken then view it ought to be a majority Australian carrier.

Glover: What if that makes it impossible to run successfully in a modern world?

Leigh: Well I think there are a range of approaches that can be taken here. Chris Bowen for example has suggested a modest equity injection by the government as a show of faith to the markets. But I think it is time for careful and consider deliberations on this. And I do get a bit worried when I see fraught by so much in-fighting over these questions rather than that sense of unity and purpose that I think you need on both QANTAS and Holden.

Glover: But let’s talk about Holden for a second. I think it’s been put quite firmly by Heather and John, really this is not sustainable that we could throw $150 million at it and not really see anything in the end for our money.

Leigh: Well I think it also has to do with the confidence that you send to the markets. Again the in-fighting between Ian MacFarlane and Joe Hockey over this hasn't been helpful. And when you look at the Wall Street journal report today suggesting Holden pulling out of Australia, I think that's in no small part driven by the sense that there isn't a sense from the Australian Government that they strongly sought to keep a strong manufacturing base in Australia. I think that is important. As an economist we talk about the two economical reasons for industry support as being spill-overs into other industries and geographic concentration, and those things do exists in the car industry. Highly geographically concentrated and tied into a very large network of part distributors all of whose jobs are at risk if Holden falls over.

Glover: But if Australians don't want to buy the cars what can you do about them? You can’t force them to buy them?

Leigh: Absolutely not unless you're talking about the government fleet, in which case the federal government has been doing very well in purchasing Australian made cars and some of the states could frankly lift their game. But overall I think it’s about making sure that there's good product on offer. Australian made cars aren't a majority in the market but they are a significant minority and they are good vehicles.

Glover: Okay, the tax payer money is valuable. I mean they've been given such a lot of money over the last 20 years, do you really give them more?

Leigh: Well the point that somebody like Kim Carr would make for example, is that there isn't an automobile on the road that isn't supported in some way by government assistance from a government around the world. And Kim would argue Australia needs to make a strategic choice about whether we want to remain one of the dozen or so countries in the world that can make a car from scratch, or whether we want to step back from that and be a nation that can't manufacture an automobile.

Glover: Heather Ridout, Lez on the email makes the same point. He says check out the sort of assistance given by the Germans and American governments to their car industry. In other words the idea of subsiding cars is done around the world.

Ridout: Well it is and we're per capita quite a low subsidizer, but you know the thing is American and German productivity is much higher than ours. They've got much more scale and their industries have much more future and I think that's very important to recognize. The other thing we have to remember we don't just make cars in Australia, we make trucks, we make caravans, we make a lot of fuel intensive things like cars and if we employ 50,000 directly say in automotive manufacturing we'd employ another 25,00 or so in this other area. They get very little assistance and they're doing not too badly and the supplier industries to them are not doing too badly. So the end of car manufacturing would be I think regrettable but it’s not the end necessarily. These trucks go to the mining industry; we make half of the trucks that go into the mining industry in Australia. We make them you know all over the place.

Glover: So you're agreeing with what John Hewson said earlier, is that if you want to keep manufacturing and engineering skills supporting the car industry is not the only way to do it?

Ridout: It’s not the only way. High tech manufacturing in the defence industry is another way. A lot of people who used to supply to the car industry now supply defence and government need to get their act into gear in that regard. So there are opportunities that I cannot underline the fact more that this decision will be very important to Australia and it needs to be very carefully handled because a lot of people will be badly affected by it.

Glover: …We'll check the Sydney traffic in a tic, but first this. It’s the 30th anniversary of the floating of the dollar. Part of the push under Paul Keating [was] to see tariff walls removed, foreign investment embraced and government owned enterprises privatised. Was it a great period economic rationalism or economic liberalisation depending on how you look at it? Looking back at that period did we take some of the changes too far or too fast? Or is it a case of as Mr Keating has clearly been putting television to Kerry O’Brien that he created the basis for Australian prosperity during this period, John Hewson?

Hewson: Look I don't want to get into the debate between Bob and Paul as to who did what and when and how, but I've heard both versions. Look I think there is an inevitability, when I came back from working in the IMF in the early 70's to work in the reserve bank, I was absolutely convinced our inward looking, insinuator, un-competitive financial and economic system was going to have to change, it was going to have to be opened up. We couldn't have centralised wage determination the way we'd had it, we couldn't live with the tariff levels we'd had, we couldn't live with the regulated financial system we'd had. So that process was actually started in the Fraser government and I thought there was an inevitability that whoever was in power come the end of 83 or early 84 when there was the next run on the exchange rate that they'd float and I actually predicted that. I did see that happening.

Glover: Why couldn't we stay as we were?

Hewson: Because you could not defend the indefensible. We had an exchange rate that was set at an artificial level, we had a regulated baking system which lacked any form of effective competition and tariff walls were unsustainable in a world that was globalising. So I think there was inevitability about it. Having said that give them credit where credits due. I mean they did take the decisions when they were there. I remember for example I think in the Labor party platform in 1983 they still had bank nationalisation listed and they licensed 16 foreign banks. It was inevitability, they had to change. To their credit they did, they managed the process very well without entering the fight between Bob and Paul.

Glover: Andrew Leigh did we take things too far or too fast during that period?

Leigh: It's funny Richard when I heard you ask the question I though John Hewson was going to answer (c) not fast enough, given the debate over it that happened in 1993. But the credit really has to go to John over this as well for not pushing the raw politics of the issue. I think trade liberalisation and a floating dollar have always been inherently tough issues. They are complicated economic areas and I guess the distinction I'd draw, and I don't want to be too political about this but is between the view that John took in 1993 and his former media adviser Tony Abbott in 1994 was still against the float of the dollar. I think the float of the dollar was a great thing in that it provided a shock absorber if you like against the Asian finial crisis, the tech wreck, the global finial crisis. You know previously these terms of trade shocks when they came along in the 30s, the 50s, the 70s, they blew the place up. We had inflation, unemployment going through the roof and thanks to a floating dollar we didn't have any of that and thanks to good politicians on both sides of the house. Keating of course but also national interest Liberals who supported him.

Glover: Let me ask about tariff walls coming down. I ask because partly because of course because we're still talking about this with QANTAS and with Holden in particular in a sense. What do you say to people that were employed in the clothing and footwear industry and saw their jobs disappear as the tariff walls disappear and now face a world where you really can't with ease buy an Australian shirt or an Australian pair of undies?

Leigh: I think it goes back to something that Heather said before about the importance of moving up the value chain. She was talking about manufacturing but it holds in textiles as well. We moved from making kids pyjamas and school shoes into doing high fashion, that's the Australian clothing and footwear sector today.

Glover: It’s a lot smaller though, it’s a much smaller sector isn't it?

Leigh: It is but consumers have benefited to the tune of a few thousand dollars a year in the pockets of the typical house hold. I remember my parents used to have to save up for a pair of kids school shoes and now you can buy them for $6 or $7 in Aldi. And that's a big difference to a family that's struggling to afford the essentials

Glover: Was all that stuff that happened 30 years ago a good thing Heather? Did it go too far, too fast, not far enough?

Ridout: I thought it was fantastic and you know I think those reforms set Australia up, and they coincided with a time when the whole world economy was globalising. When we really needed to take advantage of the freeing up of world trade and I think that it was a series of reforms, they were very hard won. You might say that we had some bi-partisanship around them but it wasn’t easy because outside of parliament. There were piles of vested interest lined up against these, so they were very well executed. I think going to what Andrew said I was going to make the same point the floating of the dollar did help us whether our way through a number of shocks to the world economy and we haven't had recession in 22 years in no small part due to that. Now the high dollar at the moment has got everyone exercised and that's really causing a lot of structural change across industries and Australia. But there is no doubt that Keating and Hawke and his predecessors and everyone around did a great job.

Glover: What about the privatisation part of it? I mean some people still say QANTAS if only we hadn't of sold it. Commonwealth Bank would've given us a means of controlling things through the economy, setting interest rates, stopping profiteering. Even the situation with Sydney airport people say natural monopoly why was it sold?

Ridout: Well I don't think the government owning those things solves the problem. I think you have to have very smart regulation and you have to have incentive for private sector investment to keep them current, to keep technology up to date, to keep their business practices sharp and that's what competition and the private sector can bring to it. You know the idea that the government would go back to owning 100% of QANTAS, well forget them ever making a profit. So I just don't think that's the answer. For one thing I think Australians have become much more risk adverse, it might be a GFC type response but it’s not reform complacency in Australia I think we're rather risk adverse. This is a real challenge to leadership who want to start arguing we ought to privatise Australia Post. Oh god what would happen? Nothing much you know it would probably be better.

Glover: And of course complacency is its own risk.

Ridout: Yes we'd probably get letters delivered on the weekend rather than just five days a week. You know and you'd probably get a whole lot of other things happening and I think this risk aversion that is really endemic in Australia and can be really easily re-enforced by conservative leadership that isn't willing to make some of the big calls. I think it’s a really dangerous thing for Australia

Glover: Monday’s political forum with Heather Ridout, Dr. John Hewson and Andrew Leigh. Now Australia has won the second test after a long series of defeats. What’s the thing in which finally victorious after number of less successful attempts? Andrew Leigh.

Leigh: I used to be a race walker Richard, it’s not exactly the sexiest sport in the world. But I took it up when I was fairly unfit as a kid at school.

Glover: A race walker?

Leigh: Race walker yes. And worked and worked and worked at it and wanting to at some stage win a medal. And then finally after 5 years of training 3 times a week and racing on the weekends I finally managed to win a nationals team medal at a competition down in Tasmania.

Glover: And then you've slumped back have you?

Leigh: Exactly, exactly. I think I switched sports and then out of race walking but it’s a tight knit community and I remember so many times getting disqualified from it. It broke my heart Jane Saville was disqualified in the 2000 Olympics. Because I'd trained with Jane and I'd gone through a tiny fraction of what she had but race walking is that kind of sport where you can work really hard, you can get disqualified and you’re just out of the game.

Glover: Heart breaking. John Hewson, victory after a number of defeats?

Hewson: I attempted to focus on some sporting achievements and so on but look I think at a very personal level I think marriage. I didn't think I'd find the love and peace that I found in my current marriage.

Glover: A few people put up their hands a victory after following defeats if you talk about romance I guess. Heather Ridout.

Ridout: Well I'm trying to figure out a few things that I've done that really challenged me like race walking or several marriages.

Glover: What ones been enough?

Ridout: Yes ones been enough. One and a few kids and a Job and the whole thing. I think probably skiing, I'm so unco you know I fall over and I'm scared of heights. I think years ago when I did that and I was desperately unsuccessful and I learnt to do it and I quite enjoyed it, and now I don't do it anymore because I'm frightened of hurting my knees.

Glover: But you could remember the fear that you had to get over.

Ridout: Yes the fear, the absolute fear you know and then the thrill when I actually felt comfortable that I could go down. That was pretty heavy stuff.

Glover: That’s what the Australian cricketers have experienced a victory after a number of defeats is far sweeter.

Ridout: I hate that talk. I think Australians should be really magnanimous in defeat and all this sort of silly talk that goes on I think it’s quite unfortunate.

Glover: Between Australia and England?

Ridout: Yeah they're good teams and you know you understand a bit of banter on the field. But I think we've got to get a bit of the testosterone out of it all although that might make us win it I don't know. If you got that out of it they might be pussy cats and we'll lose.

Glover: Well this was a great issue wasn't it in the Bradman tour of 48, I've recently read a book about it. The people that had been serving during the war on both sides wanted to play all matey mates because they'd just been through hell together. The people who hadn't for various reasons been in the war said lets go back to the old style cricket of trying to pound each other into the ground.

Ridout: I guess we do it more with words rather than actions.

Glover: Back to the World War II spirits on the cricket ground. Thank you very much to Heather Ridout Reserve Bank board member and Dr. John Hewson here in Sydney thank you very much. And former professor of economics and now Labor member for Fraser in our Canberra studios Andrew Leigh Thank you very much

Leigh: Thank you Richard