Topics: Medicare, Australian industry and border protection
E&OE……
Kieran Gilbert
Good evening and welcome to the program, Kieran Gilbert in tonight for David Speers and much to discuss from the future of Medicare to the future of Australian industry and of course, a lot on the border protection front as well. With me to do so tonight we’ve got Liberal frontbencher Senator Scott Ryan, Janet Albrechtsen, columnist at the Australian Newspaper, Executive Director of the Australia Institute, Richard Denniss, and Labor’s Parliamentary Secretary for Health, Amanda Rishworth. Good evening everyone. First to you, Scott Ryan, what’s going on on Medicare? It seems the Health Minister and the Prime Minister are playing sort of a good-cop bad-cop routine, the Health Minister says that it’s a 1980s model that needs to be fixed, the Prime Minister says he’s the best friend Medicare’s ever had.
Scott Ryan
Well, I think they’re both consistent statements. What Peter Dutton went out and started to talk about was the sustainability of Medicare. You’ve got a situation where the costs have more than doubled in a decade. You’ve got a situation where 10% of patients use almost 50% of the Medicare Benefit Schedule costs and in the medicines, the pharmaceutical side, it’s almost the same with 80% of prescriptions being issued for concessional patients. What the Prime Minister said today was we are the best friends of Medicare and what Peter Dutton’s talking about is a good friend of Medicare wants to make it sustainable.
Glibert
Amanda Rishworth
Amanda Rishworth
Well look, what we’ve heard from Peter Dutton is a clear signal that they are looking at dismantling the universal nature of Medicare. What I find quite surprising about this is for some time we’ve known that the Medicare Benefits Scheme does cost money and those costs are increasing. We heard nothing from the Liberal Party before the election, indeed they said that there’d be no cuts to health, there’d be no cuts whatsoever. We now see that they get into government and they look into breaking this down. But what I find really hypocritical about this is that when Labor was in government and we were making sensible savings around the healthcare system, including things like looking at the scheduled fee for cataract surgery, we had Peter Dutton in there saying “no, no, no, we’re not going to make any of these savings.” He’s suddenly got into government, surprised there’s an issue with costs, and then trashes the universal nature. Well, we will not allow that to happen.
Gilbert
Richard Denniss, is it fair to say that it is unsustainable, the health budget as it stands on the current trajectory, do you agree with that premise?
Richard Denniss
No not at all, I mean Australia’s one of the richest countries in the world, we have one of the lowest rates of tax in the developed world, and the fact that the population’s getting older is something we’ve known about for a long, long time. All of the data on most of the medicines are being used by a small number of people, yeah the sick people. It’s always been the same. Unfortunately the thing with illness is that if you’re really sick, we put a lot of effort into you, that’s the plan, this is not unexpected. So, as the population ages, we will spend more money on health, that’s the plan. We could spend a lot less money on health and people could die quicker, you know, and if the government wants to lead the charge to spend less money on health, and cap access to pharmaceuticals for sick people, or say “you’ve been to hospital too many times , this 20%of people are clogging up our hospitals.” Well, 90% of people are luckily in good health, 10% of people need a lot of intervention, not forever. Some people do need intervention forever, and that’s what the NDIS is about, but people have these episodes of serious illness, with the episode of serious illness comes either hospital interventions or lots of pharmaceutical interventions, and if it works then we get a healthy citizen back and if not, people die.
Gilbert
Janet Albrechtsen, do you accept that a co-payment, or for example another change like having private health insurers cover a GP visit, things that are eligible under a Medicare rebate, that those sorts of measures would eat into the principle of universal medical care.
Janet Albrechtsen
I think that we need to do something when it comes to health in this country. I don’t accept that, you know, we have a government on either side who would ever want to see people die by reducing spending on health. I don’t think it’s the end of universal health care in this country, I think that if you look at the numbers, the structural shift in spending in health, we haven’t really noticed it. If you look at the fixed costs on health, education, welfare, they’ve gone, as a percent of government outlays, from 20% to 58% in forty years. Now that is not sustainable, it’s not sustainable and most of that is to do with health. The biggest chunk out of those fixed costs is to do with health, not education, not welfare. Something has to be done, I think it’s completely reasonable for us to be having a debate about this, I think it’s important that we do, maybe co-payments. I mean we have to start to prioritise, we can’t do actually everything, we can’t have an NDIS, and I fully support an NDIS, we can’t have that, we can’t go on spending on all the areas that we spend without saying “well what are the most important things.” Surely it has to be NDIS, surely it has to be a health system that’s sustainable over the long term. This about the long term, right? This about getting the right policies in for the long term.
Gilbert
Richard Denniss, I want to ask you about the principle of having someone, and this is what Peter Dutton said in his speech yesterday and again today in the media, the principle of having someone who can contribute more to pay for their health care, to do that.
Denniss
Well, let’s face it, many people do. Universal bulk billing is a thing of the past and most high income earners wind up the moment the doctor decides whether there’ll be a co-payment or not. But if we’re going to introduce a co-payment, say a $6 co-payment for low income earners, let’s be really clear. If you’re earning $300 a week, a $6 co-payment is going to be a big deal for you, if you’re earning $1,500 a week it’s a small deal.
Gilbert
Is there exemptions for those without the means to pay, because that’s what that recommendation…
Denniss
Well that’s where it gets very confusing, because the idea that you have either exemptions and/or the ability to insure for it. Well, if you could insure to avoid a co-payment, then the co-payment’s not sending any signal. If the purpose of the co-payment’s to discourage people from going to the doctor, then insuring so that you don’t have to pay for the co-payment is a waste of everybody’s time. And if you’re going to say to the people who go to the doctor the most, the sick people, you know, we’re going to discourage you from going to the doctor with a co-payment, it’s a waste of time. So, if you’re going to have exemptions it doesn’t work, if you’re going to have insurance it doesn’t work, if you just want to say well, high income earners should pay six bucks when they go to the doctor, well that’s why we have the Medicare levy at the moment.
Gilbert
Senator Ryan, do you accept the point that Richard makes there, that there is a large cohort of people who already do pay out-of-pocket expenses, and quite a bit.
Ryan
About 30% of visits to a GP have an out of-pocket-cost, with an average out-of-pocket cost of about $20 to $25. But let’s put in perspective what Peter Dutton said, he said let’s start having a national conversation. Medicare now is not the same program it was when it was introduced thirty years ago. There’s a Medicare safety net. If you want to look at the impact of co-pays, go and speak to a patient who might take a sick child to a doctor. It might be bulk billed, but then they have to pay $38 out of their pocket to get medicine at the front door. There are barriers to healthcare and they’re not always very rational at the moment and all Peter Dutton said is let’s start having a conversation to make the scale of spending sustainable and actually look at why do we have a law that bans, it actually bans, insuring for the out-of-pocket cost to see a GP.
Rishworth
Well of course this is going towards an Americanised model and…
Ryan
It’s got nothing to do with that.
Rishworth
… if you actually look at our spending of GDP, it’s about 9.1%. America is at 17% of GDP, I don’t think we want to go down and Americanise…
Ryan
It’s got nothing to do with that.
Rishworth
Well that’s what it sounds like. But I’d like to make another point about the co-payment. Co-payment is about stopping people, for making people think twice before they go to a doctor. Now, when we’re in an age when prevention is so important for health. We try and get men to go and check their prostate, if they are thinking twice about whether to go to the GP because of this co-payment, because we want to deter people from going, then that’s a real problem in the long-term sustainability of our health. Prevention has got to be the key.
Ryan
Then why didn’t you do anything about the high cost medicines, I tell you the biggest barrier to a person taking two sick children…
Rishworth
…We made a lot of changes in the pharmaceutical agreements, and indeed, you were the ones that blocked that and criticized that all the way through the pharmaceutical agreements. During the election campaign, we were looking at ways we could reduce the Pharmaceutical Benefits Scheme and you were saying “no we’re not going to make those changes.”
Ryan
You’re breaking agreements now you signed only a year earlier…
Gilbert
I want to bring in Janet Albrechtsen about the idea of the co-payment and this is something the AMA president also warned about, that it might not be as simple as simply introducing the payment and that will have the desired effect of reducing costs because it might have that impact that Amanda warned about, that people don’t go and end up in hospital and it costs more.
Albrechtsen
I suspect that the AMA was always going to say that. The problem with reform in this country is that we have for so long, not really had any losers whenever there’s reform, we’ve just been able to keep spending more and more, and that was on the back of the mining boom, it was during the Howard years, it was during the Labor years. We haven’t really had to make the tough decisions. If we’re going to be serious about getting the budget into repair, about looking at economic sustainability over the long term, we’re all going to have to bear the cost here, every single one of us. High income, middle income, what we want to have is the right safety net for the low income.
Denniss
High income, low income, pharmacists, doctors, let’s be clear…
Albrechtsen
All of them. But what we’re going to hear, let me finish what I was saying here, we need to actually accept that yes, there are going to be losers from reform. It’s a classic problem with economic reform, you’ve concentrated benefits and diffused costs so those who have been on any form of entitlement, and I’m talking the rich, the middle class, the poor, they’re going to scream blue murder every time there’s any kind of tinkering with it and that’s what the Abbot government faces and it’s a mighty struggle, right? And the rest of the tax payers who sit back and fund this don’t tend to say too much. They might be sitting there quietly applauding reform. Unfortunately governments don’t hear from those, they hear from the vocal interest groups, that’s what you’re going to see over the next few years.
Gilbert
Ok, Richard, you want to make a point.
Denniss
I agree entirely, and the loudest groups are the pharmaceutical companies, the loudest groups are the pharmacists, the loudest groups are the doctors and I look forward to the government taking them on because Australians are paying far higher prices for some medicines than citizens in New Zealand.
Ryan
We’re also paying far lower prices for all the new medicines.
Denniss
Indeed, so let’s get the best of both worlds, let’s reform the way pharmacists are paid…
Ryan
New Zealanders don’t get access to those new medicines, they don’t get them at all.
Denniss
I’m talking about generic medicines.
Ryan
I appreciate that.
Denniss
Then let’s not confuse the issue, we pay higher prices for off-patent, generic medicines than New Zealand because the negotiating power of the pharmacists. So yeah, let’s spread the pain around. Let’s not lower the quality of services, let’s pay the pharmaceutical companies as lower price as we can, let’s pay the pharmacists, you know you can’t set up a pharmacy within 1.5 kilometres of another pharmacy?
Albrechtsen
They are one of the strongest unions in this country.
Denniss
This is where we can agree Janet.
Albrechtsen
They pump a lot of money to both sides of politics and they have over the years…
Denniss
Nice big building in the Parliamentary Triangle.
Albrechtsen
… they have got a lovely monopoly on what they’re doing and I would love to see a government get stuck into that monopoly and then we’ll see prices come down, we’ll see consumers benefiting and that’s what… if you’re talking tough reform…
Gilbert
It is nice to see a bit of unity early between you two. Amanda, you wanted to make a point.
Rishworth
I think there can be efficiencies found and I’ll give a really good example, the cataract surgery that I mentioned, the old way of doing cataract surgery, it was about four hours. While we were in government we looked at changing the amount that we provided to doctors to reflect that technology changed, that it was now a 45 minute procedure. Now, unfortunately Scott, you were in the Senate, the Senate disallowed that. I mean it’s those sensible things that we actually look at in terms of cost, how technology has helped, what other costs…
Gilbert
Do you think there’s a structural issue that needs to be looked at when you have numbers which will be 7% of GDP by 2050, that’s the figure that the Minister’s citing. That’s up from 4% now, we’re talking tens, hundreds of billions of dollars.
Rishworth
Well, also the Minister’s talking about a co-payment which is a drop in the ocean if he’s actually talking about $6, it’s actually not going to make a huge difference to the budget. I mean, let’s be frank, this is about stopping people from going to the doctor. I really don’t think…
Gilbert
That’s one point, isn’t there also, you know, a number of other things being discussed here, to make people, who can, pay more for their care.
Rishworth
They do pay more through the Medicare levy and look, when we took measures to reduce the costs of the private health insurance rebate, we wanted to means test, we had people kicking and screaming from the Liberal Party saying this would be the end of private health insurance, of course it wasn’t, there’s more people in private health insurance. I think you can do some sensible things without destroying the universal nature of our healthcare system
Gilbert
Senator Ryan, you are a keen student, of course, of Australian politics, you know the history of the Medicare debate, and politically can be red-hot. The Prime Minister today was obviously very keen to calm things down a bit and says he’s the best friend Medicare ever had, as the former Health Minister. How can he state that on the one hand, and maybe adopt a difficult measure, recommended by the Audit Commission?
Ryan
The best friend of Medicare is actually going to be the person that makes it sustainable. So when there were huge out-of-pocket costs that Medicare, as broken system ten years ago, wasn’t dealing with, Tony Abbott introduced the Medicare Safety Net and that actually helped for those high out-of-pocket costs. No program stays static, I mean the British NHS is a huge problem, precisely because it’s almost the same if was thirty or forty years ago and nothing has changed…
Gilbert
But I think if people are going to be forking out more money and there are more out-of-pocket expenses I’m not sure that they’re going to think he’s being a great friend to anyone.
Ryan
No, the point is actually making sure Medicare is a system that is about giving people access to healthcare. It makes sure people get healthcare when they need it, as best as our community can provide. We’ve changed it, we’ve tweaked it, different amounts that people have been paid have changed over the years, the Medicare Safety Net was introduced, we had a private health insurance rebate, which did help Medicare, it did take pressure off public hospitals. Labor did write a letter, saying they wouldn’t means test I and then they proceeded to straight away. So, no system stays static
Rishworth
You didn’t mention this before the election either.
Gilbert
Well that’s true, Richard Denniss, it hasn’t been static, there have been incremental changes over the thirty-odd years.
Denniss
Well of course they could, and Peter Costello in 2001 was warming us up for this. So the idea that there’s some crisis that this Commission of Audit’s just discovered, well they’re about twelve years too late. But look, if the Government’s serious about the budget, and that’s a big if, the fastest growing area of expense is the tax concessions for superannuation, the fastest growing. It’s going to be $50 billion a year in tax concessions for super and before the election they promised to not touch it. So, if you want to talk about sustainability of programs, the biggest fastest growing thing in the budget is the tax concessions for superannuation and they’re committed to not touching it so if you keep your promise to not touch it, you know, don’t lecture people about taking the budget too seriously.
Ryan
Are you criticising us for keeping a promise? I mean Labor promised not to touch it and then they did after the 2007 Election…
Denniss
It was a silly promise to make.
Rishworth
You also promised you weren’t going to introduce new taxes …
Denniss
You ruled out economic responsibility before the election. You promised to not even consider touching the fastest growing expense in the budget, the fastest growing.
Ryan
After five years, where the best person doing everything they could to understand their own superannuation could not keep up with what Labor was doing, year after year, change after change. There was no certainty about the contribution limits. What we did was actually try and give a very important part of the economy, and people’s savings, some certainty.
Denniss
Well, it’s a very expensive promise you made.
Albrechtsen
Could I just make the point again, and I’m actually getting a bit tired of agreeing with Richard, you know we are going to have to have cuts right across the board. One thing we haven’t talked about this evening is, because we are facing structural deficits, we can either keep pushing this off into the sunset, but then we’re leaving the bill for future generations, is that really what we want to be doing, I just see that as completely irresponsible as a nation. We can keep enjoying the best of everything, and we have lived a very good time in Australia in the last twenty, thirty years and then we shift it on to the next generation and they will bear the brunt of our lifestyle choices? I think that’s completely irresponsible and I think to have a government which is talking about these issues, the co-payment may not be the answer, it may only be part of the answer, I suspect if may only be a small part, like you say Amanda, but there may be many other areas in terms of health spending which the government can confront. The question again is whether they have the courage to take on economic reform, it’s a big ask.
Gilbert
Well we know that they’ve got the Commission of Audit already in their possession and really, many would suggest, that the politics thus far until the May budget, it’s all a bit of shadow boxing, and that’s when the real agenda and the trajectory of this government will be seen. Let’s take a break, after the break we’re going to look at the unrest on Manus Island and the broader debate around border protection. Stay with us.
(Ad break)
Gilbert
Welcome back to the program, with me tonight Liberal frontbencher Senator Scott Ryan, Janet Albrechtsen, from the Australian Newspaper, Richard Denniss, from the Australia Institute, and Labor frontbencher, Amanda Rishworth. Let’s look at the unrest on Manus Island this week, tragic developments, one man lost his life. Amanda, this was a policy put in place by the former Labor Government, should Australia still be sending asylum seekers there?
Rishworth
Look, when we came up with the PNG Regional Resettlement Arrangement, we believed it was an important part, in fact it was the cornerstone of our asylum seeker policy and that is to say that you cannot buy a ticket to Australia, you will not be resettled in Australia. Of course what we need to see is the Manus Island Detention Centre run orderly and properly and therefore that’s why the Shadow Minister has called for an investigation at arm’s length of Government into this. But, we believe for the integrity of our border protection policy, which the Liberal Party will now claim credit for, we do need Manus Island as a cornerstone of that policy, but it does need to be run… Obviously the events were absolutely tragic that we saw there, it does need to be run in an orderly way and that’s why we’ve said we need to get to the bottom of this.
Gilbert
Should there be an inquiry which is at arm’s length of the Government, because at the moment only the Immigration Department is looking into the events of a few nights ago.
Ryan
Well first, I think Scott Morrison as the Minister has done a fantastic job in a very difficult circumstance over the last few days. There will be inquiries by the PNG government, the Minister has sent General Campbell up to PNG and the Secretary of the Department of Immigration is there as well and obviously anything that happens is also within the jurisdiction of the Papua New Guinea Government because it is in PNG, so I think that is a sufficient number of ongoing inquiries at the moment. There are extra security guards there to ensure as peaceful environment as possible. As the Prime Minister made clear today though, we’re not going to be subject to moral blackmail. I know the Labor Party likes to try and claim credit for this particular idea, after they dismantled the previous arrangements and they’re still blocking the other cornerstones of the border protection policy that worked, such as voting with the Greens to disallow Temporary Protection Visas in the Senate, which they have done now on one occasion and are threatening to do again. All the Coalition wants to do is to implement the policies that we know worked and that Labor dismantled.
Gilbert
Richard Denniss, if you look at the numbers of individuals making applications to the UNHCR in Jakarta, they’ve dropped dramatically, month on month. This shows not only that the boats are stopping, but doesn’t it also show that the number of people arriving in Indonesia in the first place, to then make their way on to the boat, they are also declining.
Denniss
I think that what it shows is how proud both parties are of these harsh policies. I think we’ve just seen someone killed with a machete, we have people in hospital whose throats have been slit and we’re having a conversation about “is it being effective?” Well, capital punishment might be a great way to discourage graffiti, you know? As a society these are choices we make, and I’m sitting here listening to people from two political parties squabbling over whose idea this was, when someone’s just been killed with a machete… No look, you had your go, you can disagree with me all you like. As an Australian I’m ashamed of this, I think the idea that this is the price that other people pay for our border protection policy is abhorrent to me, not to you, to me, and the idea that it seems to be working because numbers have slowed, well let’s see what happens after Australian and other troops complete the withdrawal from Afghanistan, let’s see what happens when things resolve themselves, hopefully peacefully in Syria, but perhaps not. Let’s see what happens to asylum seeker numbers when the word, not Australia, when world events turn again, I don’t know. But if you want to tell yourself that someone dying, someone being killed with a machete is a small price to pay to send a strong signal…
Ryan
…Get off the high horse for a second, don’t use the capital punishment analogy. No Australian actually stood there and did those things that you mentioned….
Denniss
This is Australian Policy…
Ryan
… You’re comparing it to capital punishment…
Denniss
Yes I am…
Ryan
… And I’ll defend Amanda here, and you’re both saying that we’re both happy about what happened, or implying it, that’s offensive. Just criticise the policy, say you disagree with strong border protection policies, I know you do…
Denniss
… Do you want to send people there tomorrow, before the inquiry is complete? Do you want to send people there tomorrow?
Rishworth
… Can I point out, I just like to say…
Denniss
I think that’s a yes.
Rishworth
I would just like to say, you are making this about those, tragic circumstances, what about the people that are drowsing at sea? And that has certainly been something I think that has led to a big change in attitude in people I talk to, not being able to tolerate the numbers that were dying at sea and I think…
Denniss
How many should die by machete before we reconsider that?
Rishworth
… None should, absolutely none should…
Denniss
But we’re sending people there, we are continuing, there is no inquiry
Rishworth
What we need to do… I agree with you, I think there needs to be an inquiry…
Denniss
Yet we are intending to continue to send people back into this environment. Let’s be clear, we are continuing to send people back into this environment. That’s either acceptable or not, it’s not acceptable to me.
Gilbert
Janet Albrechtsen, isn’t it inevitable that when you have 1,400 people in an environment like that, and not with any certainty, because they have not been processed or told definitively that they will be going to be settled in PNG, that these sorts of tensions will inevitably erupt, won’t they?
Albrechtsen
I think that’s probably right, but I’ll tell you why I think the tensions have arisen and that is because we actually have a government now which has a firm immigration policy, a firm border protection policy, previously people in detention camps knew that we had a Labor Government, under Kevin Rudd, Julia Gillard, Kevin Rudd, that was liable to change, and it changed any number of times. You only set up the offshore detention centre right at the end, right before the election, I mean it was the right thing to do, but you shut down the offshore detention centres in the beginning, that caused the onslaught of the people smuggling business… there was a thriving business after that…
Rishworh
Well, there was a 90% decrease from the day we did it to the election.
Albrechtsen
… you did it right at the end, Amanda. The offshore processing detention centres should never have been shut down, we wouldn’t have seen more than 1,000 people die at sea, ok? I just find the hypocrisy of the left breathtaking on this. To demand a Royal Commission, where were the calls for a Royal Commission of the failed immigration policies that led to 1,200 people dying at sea? Let me come back the tensions that are arising. So yes, people now know that there is a government that’s not about to change their immigration policy, of course they’re not happy with that. They’d rather have a government which chopped and changed and gave them a chance to resettle in Australia. They know it’s not going to change, no matter how hard they riot or the threats they make. Tonight we saw claims coming through from Papua New Guinea MP that asylum seekers have made threats of raping the mothers and sisters of guards at the detention centre on Manus Island. Now yes, we need to find out, we need to have an investigation or a review into what’s actually happening but these people are not happy. But the upshot of that is that boats have stopped arriving, that the numbers coming into Indonesia, to get on boats and even to join the refugee applications have slowed enormously. Now that is not a nice policy Richard, it is a harsh policy, but it’s a policy that prevents more deaths. No one wants to see one person killed on Manus Island. If you have to make make the tough decisions, and it’s not just power, it’s all about responsibility here, if you have to make the tough decisions, you want a policy that reduces the number of deaths by the greatest number.
Gilbert
I suppose the other point is that’s regularly made in this context Richard, is the need to block that abhorrent trade of people smuggling.
Denniss
Again, I’m not sitting here defending people smugglers and we have the Australian government spending $1.5 billion a year, that’s not the billion that puts pressure on the deficit so we don’t have to worry about it, these are the special immigration dollars. We’re spending $1.5 billion a year, we’re writing the checks, we own this, we’re paying the guards, this is policy we’re fighting over, whose great idea it was. In twelve months there have been fifteen serious allegations, we’ve now seen some killed, we’ve got people, talk about rape, there have been allegations that the inmates have been raped, but we’ve got no idea. Who investigated that? This is happening in our name, we are paying for it to happen, leave Manus Island aside in terms of does it work or not, I start from a different place than the rest of you, but we’re paying for it, we own it, we run it, someone’s just been killed, and we’re saying “oh the Immigration Department, who manage the program should look into it themselves.”
Rishworth
I’m not saying that, I’m saying quite clearly it should be at arm’s length, and indeed when we were in government and there were disruptions in our offshore processing centres we did have an inquiry at arm’s length because it’s the only way you do actually get the correct information. So I absolutely think that this should be looked into properly and not by the people running it or paying for it or…
Dennis
…Maybe Tim Wilson the new ‘Freedom Commissioner’ can look into the freedoms…
Albrechtsen
Can we also take a longer term view here, I mean the aim is to not have people in detention centres, alright? At the end of the Howard Government, just a handful of people in detention centres, you don’t want hundreds of people in detention centres, ok? You need a firm, hard policy, whatever you want to call it, so that comes to an end.
Gilbert
Senator Ryan, doesn’t that go to the point of what needs to be done now, and that is to process the group of people on there, 1,400, quickly, to remove this position where they’re stuck in basically a pen in PNG?
Ryan
The first thing that needs to be done is for the Government to remain resolute as the Prime Minister said today. We don’t have an Oceanic Viking situation that happened under Kevin Rudd where the people smugglers know you crack the resolve of the government, and the Prime Minister made that clear, because the worst thing that could happen would be to do what Kevin Rudd did and start the flow again. This is a tragic, tragic episode in Australian history. In my view this is money well spent, to protect lives and to have control over who is coming to our country and to continue to support the people we take out of camps in Africa, many of who I’ve met in Melbourne and support them as they adjust to our society.
Denniss
(inaudible)…
Ryan
…They’re all very expensive programs Richard.
Gilbert
You’ve also aggravated the bilateral relationship with Indonesia though. You’d concede that, that has been some collateral damage as part of this hard line.
Ryan
The bilateral relationship with Indonesia, as has been written on a number of occasions, suffered its biggest hit in recent years when the Indonesian Government didn’t understand why the Australian Government dismantled the policies that saw thousands of people come to Indonesia.
Rishworth
That is not the case, that is not the case.
Ryan
If you’re referring to the unintentional and accidental transgressions into Indonesian waters, we had an inquiry, they happened on half a dozen occasions, an apology has been made, an apology has been restated…
Gilbert
They don’t believe the explanation, that’s what their Navy Spokesman has said.
Ryan
Indonesia’s a pluralist democracy and we always hear various voices out of Indonesia which is a great sign for the nation. We have made it clear that it won’t happen again and we actually apologised, fully and frankly for those transgressions.
Rishworth
Look we were talking about less people actually turning up in Indonesia and one of the things that were negotiated by Kevin Rudd was actually, and they asked with a good relationship with Indonesia, is not to provide Iranians with a visa on arrival. Now that was a policy that has seen less Iranians come to Indonesia and a policy that can only be done with a good working relationship with Australia and Indonesia. What I’m very concerned about is that relationship with Indonesia has significantly deteriorated, and it has Scott, you cannot say that our relationship with Indonesia, when even the head of our Armed forces is saying that the cooperation is on a ‘go-slow,’ can say that our relationship is very good with Indonesia. If we are going to tackle this, not just this regional issue, but a range of regional issues, we need to maintain a good working relationship, whether it’s border protection or whether it’s a range of other things that are so important. I am very concerned that it’s not just the incursions, it’s a range of different things and when it comes to incursions, why is Scott Morrison just blaming the Navy? It is your policy that has led to this and it is your policies that are leading to a deterioration of the relationship.
Glibert
I want to go to Richard Denniss, on the broader bilateral relationship, do you accept that intermittently there are issues in the relationship, there have been for many years, Labor had the live cattle.
Denniss
Of course there always will be, but let’s be clear, I think the problem is that the resolution that we heard about here, the idea that Australian Government policy, “we are resolute and unchanging,” that’s the exact opposite to diplomacy. What we’re telling the Indonesians is “we are never having a conversation with you; I made a three word slogan before the election, I don’t care what the cost with my relations with Indonesia, I don’t care what the cost with people being killed an island.” You’re governing as if a three word slogan is a diplomatic approach to dealing with the rest of the world and the fact is running the country is a lot harder than getting elected and we are paying a significant price from the Indonesians and we will over time…
Gilbert
Do you accept that, Janet Albrechtsen, particularly in the context that SBY, he wraps up his second term as president this year and there’s no guarantee that the next president will be anywhere as near friendly to Australia as he has been, and both sides of politics agree that he’s probably the most Australian-oriented president that we’ve seen out of Indonesia.
Albrechtsen
I think that’s right and we don’t know what will come of the elections coming up, and that’s why we need to remember that there are elections coming up, and a lot of the posturing that we’re hearing, I mean the media has beaten it out of all proportion, I think Labor has gone a little bit overboard on this and I don’t think it helps Australia’s national interest to have the relationship with Indonesia undermined in this way. I think there are a lot of domestic politics going on in Indonesia, where it plays to a certain group of Indonesians to not say anything terribly nice about Australia. That sort of standing up to your big neighbour, countries do that all the time. Can I just come back to something Richard said, with respect Richard, to suggest that their aren’t conversations going on at the highest government levels between Australia and Indonesia and it’s just Tony Abbott out there saying “stop the boats,” you know, three word slogans, that’s incredibly naive. I can tell you there are, many, many, we don’t hear about it, there are many, many, private conversations going on…
Denniss
Of course there are, I didn’t suggest there weren’t.
Albrechtsen
No, but you were saying that Tony Abbott’s just out there, he’s not talking to the Indonesians, of course he’s talking to the Indonesians.
Denniss
No, I’m saying that our policy is shaped by that slogan. That slogan was made before the election and remember, when Tony Abbott met with SBY in Darwin before the election, he didn’t bring this issue up. So you know…
Albrechtsen
To suggest that there aren’t very close cooperation…
Denniss
…I did not mean to suggest that. Of course there’s conversation going on, but those conversations are taking place in an environment where the national media in both countries is paying a lot of attention to these issues.
Albrechtsen
And remember it’s in Indonesia’s best interest to get this issue sorted, it’s a big issue, it’s not their biggest issue, Indonesia has enormous issues confronting it as a nation, but it’s a big issue and it would be great for both countries I think to see this under control.
Ryan
The most important thing with Australia’s relationship with Indonesia, and with all neighbours in our region, is actually predictability. So Richard equates being resolute in a policy with somehow showing disrespect, it’s got nothing to do with that. It’s actually about being predictable and showing respect so you don’t have an Oceanic Viking, you don’t have their Foreign Minister find out you’ve cut out part of their food supply by someone telling you it was broadcast on Radio National. Predictability is a sign of respect and that what this Government’s committed to in our relationship with Indonesia.
Rishworth
I’m not entirely sure that the Indonesians, from what we see around the place, are feeling very respected at the moment by
Ryan
It’s a pluralist democracy…
Denniss
I don’t think they predicted us invading their waters six times, so that might be a problem.
Gilbert
We’ve got to go to a break; we’ll continue our discussion in just a moment, the future of Australian industry and also WA going back to the polls for the Senate re-run.
(Ad break)
Gilbert
Welcome back to the program, thanks for your company. With me tonight, Liberal frontbencher Senator Scott Ryan, Janet Albrechtsen, from the Australian Newspaper, Richard Denniss, Executive Director of the Australia Institute, and Labor frontbencher, Amanda Rishworth. Let’s look at the future of Australian industry. Janet this week, more bad news on the jobs front, Alcoa about 1,000 jobs, on top of that you had various other announcements prior to that, with Toyota, Sensis with about 800 jobs this week. The news has not been good, and the unemployment rate now up at 6%. What does the Government, the country need to do to turn that around?
Albrechtsen
Well it should be what the country does rather than what the Government does, there are only so certain things I think that the Government can and should do. Yes, they can retrain workers and they should retrain workers, to the extent that they can, of course, yes they can invest in infrastructure, but you need to be very careful here. We get very caught up in using the word infrastructure as if it’s the sexiest word, you know we’ve got the infrastructure Prime Minister, you need to be spending money on infrastructure that has a high productivity dividend, it’s got to be the right kind of infrastructure spending but the best thing the Government can do is actually make it easier for business to grow, to make it easier for businesses to employ more people, to grow their business, to get rid of red tape so they can spend more time growing their business. That is the best thing you can do to get the country growing, of course there are religions, and I know that Denis Napthine has been speaking to the Prime Minister during the week about what the Government can do there, today Tony Abbott mentioned that he may be interested in putting federal funds into the East West Link, stage two of that, and if he does that, that would be great for Victoria. So there are things that you can do, but as I say, the best thing that I think the government can do, on a country-wide front, is to make it easier for business to operate in this country because it’s not terribly business friendly anymore. You can speak to any head of any business in Australia, it’s not terribly friendly anymore, it used to be a friendly place to do business, it’s not.
Gilbert
Ok Richard, let’s bring in Richard Dennis on this because we’ve seen Alcoa, the car makers, is this something that we need to get our head around, that there’s a structural shift happening in our economy, we have to adjust.
Denniss
There’s always a structural shift, it never actually stops changing and I agree with Janet, I think we have to be careful about thinking that government can fix all of this. The problem is of course, in opposition, both sides again, when they’re in opposition they think they can fix everything. Well, you know the reality is, cutting the Carbon Tax and cutting the Mining Tax hasn’t provided the certainty that pre-election apparently business wanted. The reality is, let’s start with the facts, the manufacturing industry…
Ryan
We haven’t been allowed to yet, give us credit.
Albrechtsen
You need the Senate to help you pass it, you don’t seem to have that at the moment.
Denniss
You’ll have the Senate in July and I think businesses are long term enough to cope with these things, nut the point is, three word slogans before the election, “scrap the tax, we’ll create the jobs,” running a country’s a lot harder. Manufacturing employs over a million people, it actually employs over four times as many people as the mining industry, we’re seeing some big high-profile closures, this was almost inevitable with the exchange rate as high as it’s been because of the mining boom. So these things have been coming for a long time, we now have to be very careful about what we do about it and I think the worst thing the government can do is what it promised to do before the election, and that’s significantly cut spending. I mean, cutting spending at a time when the economy is shrinking is like chucking a brick to a drowning man. Economists around the world might disagree on long term things about debt and deficit, but if you want to go out and significantly cut spending at a time… you can shake your head, it’s what the text books are pretty clear on, if you want to cut spending now, you will harm confidence, you will take money out of the economy and it takes a long time to recover.
Ryan
If government spending money and this Keynesian myth worked, Europe would be the strongest economy in the world. The last five to ten years, particularly the last five, have proven this Keynesian myth of the Government pump priming the economy simply doesn’t work. In fact, when we had fiscal consolidations…
Rishworth
Well it got us through the Global Financial Crisis.
Ryan
… no our exchange rate and the low interest rates got us through the Global Financial Crisis…
Rishworth
Come on, Scott
Ryan
When we’ve had fiscal consolidations, whether you look at Victoria in the early 90s, Australia in the mid 90s, the United States when George Bush Senior did it, which has been the basis for growth…
Denniss
This is hilarious.
Ryan
…when governments cut deficits. This Keynesian myth’s been disproven simply by facts, look at all of Europe and look at the United States.
Gilbert
Why then is Joe Hocking talking about the need to recycle assets right now, to boost infrastructure? Isn’t it, in part, to create the activity left by the waning mining investment boom?
Ryan
One of the reasons the Treasurer’s talked about is because we do have an infrastructure deficit and the bottom line is the Governments have all borrowed too much money to be able to do it themselves. That’s one of the reasons he’s explicitly stated that we need to get private sector investment…
Gilbert
But he also did point to the anaemic growth rate and not wanting to cut…
Ryan
…He pointed to a short term decline in business investment, and can another form of investment take that place by facilitating investment and infrastructure. But what Richard is talking about is cutting any sort of spending and having the sort of financial policies that have driven Europe to the brink. Janet mentioned earlier, the Government can’t put off forever the financial reckoning, it can only delay it.
Gilbert
Alright, Amanda?
Rishworth
Well look, firstly I reject that it was inevitable the car industry was going to leave this country as abruptly as it did; it was the actions of the Government that goaded Holden out of this country. There is now a responsibility, and while I take your point that governments can’t fix it all, there are things that government can do to actually help business back on its feet. I have a lot of components manufacturers in my electorate that really want to see some action from the government. We’ve heard $60 million put on the table, well what is that going to be, how’s it going to be spent, and what are we going to see from it? I do think there is a role, not only to retrain workers, but to actually work with those components manufacturers to actually connect them to global supply chains, help them transition their business. I disagree that we just get off, take our hands off the wheel and not be interested. I’ve seen that work when it comes to Mitsubishi and I saw the State Government actually buy Mitsubishi and attract an innovative hub now at that Tonsely site where you’ve got universities, TAFEs and now advanced manufacturing coming on to that site and actually creating some momentum there. So I think there is a role for governments in this and I think that Tony Abbott should be doing more on this.
Gilbert
I want to ask Richard, you were clearly wanting to come back to some points made by Scott. The point I would make to you is the same point I made to Scott a moment ago and that is that Joe Hockey is clearly talking about not cuts across the board. There will be spending cuts and we know what they are in large part, but there’s also going to be a big infrastructure spend, isn’t there?
Denniss
There is, there’s a couple of issues. But first Scott, I really commend Peter Costello’s 2001 Budget Speech to you and the 2001 Budget Papers really spelled out how Peter Costello and Treasury thought that Keynesian economics worked when they had a deficit in 2001. So it’s great that we’ve heard live on telly that the Keynesian myth’s been busted, Peter Costello was a fan. As opposed to the issue of cuts across the board, the economy can’t really tell the difference between good spending and bad spending, in the short term, so of course we should pick infrastructure projects carefully, we should be very dubious about claims that some mining companythat wants a railway built or something or other. The fact that it’s long lived asset doesn’t mean that we should be paying for it, but if you pull tens of billions of dollars in government spending, whether it’s welfare payments, whether it’s government programs, doesn’t matter what, if you pull tens of billions of dollars out of people’s pockets when the economy’s slowing, you’ll make it worse, not better.
Gilbert
Let’s move on to our final issue of the night and that is the WA re-run of the Senate election. Senator Ryan, given the Liberal Party had secured three of the Upper House seats at the first two counts of the Senate election, you’ve got the most to lose here, don’t you in this re-run?
Ryan
There’s never really been an electorate screw-up like this in Australia before and I think that there are questions that the Electoral Commission’s going to have to answer before Parliamentary Committees about that. This is an opportunity for the Government to try and force the Labor Party to listen to the mandate of the people, because we’re going to run on the same platform we ran last time…
Rishworth
Same three word slogans.
Ryan
… We’re going to say “let us fulfil our promises.” All we want to do is fulfil the promises we took to the people before September 7 last year and that includes abolishing the Mining Tax which does so much damage to Western Australia, abolishing the Carbon Tax which is hurting industry all round amongst various other measures and the only thing stopping us keeping our promises is the Labor Party.
Gilbert
You’d expect a… I’ll come to you in a moment Amanda… Janet, you’d expect quite a big field in this one wouldn’t you?
Albrechtsen
I think it’s going to be an absolute circus and yes, we’re footing this bill sadly enough. It would be a nice piece of spending cut to undertake. Yeah, it’s going to be a circus, there’ll be every man and his dog standing in this election and yeah, I think you’re right, the Coalition has the most to lose. I think traditionally we see by-elections as an opportunity to give the government a kick in the pants, and that may well happen, so it will be harder potentially then for an Abbott Government to get some of these important reforms through which, more the shame that, more the shame.
Gilbert
Amanda, that is a real possibility with the post-July senate make up, but it’s a test for Bill Shorten as well, isn’t it? Because if you’re around, certainly if this vote happens after the Budget, which is going to be a tough budget, surely Labor would have to consider itself a fair chance of doing well over there.
Rishworth
What we’ll be pointing out is all the broken promises that the Liberal Party in government has made, the things that they didn’t tell people before the election, the things that they did tell people before the election and then we’ve seen a backflip or then suddenly explain that they’re going to add a $6 visit every time they go and see a GP. What we are going to be doing is making it really clear in Western Australia about what the Government promised before the election and what they’re actually delivering.
Gilbert
This has been your weakest state though, hasn’t it? It’s been a very weak area for Labor for some time now, really since Alan Carpenter. This is a chance to try and rebuild some support in the West, surely you’ve got to make the most of this opportunity.
Rishworth
We can do better in the west and I believe that we will be running a very strong campaign. We didn’t want Western Australians to have to go back to the polls, but with this election we will be sending a clear, united Labor message out there about what it means to vote for Labor, that Western Australians do want to have a Senate that does hold this government to account and insure that they don’t continue to pass things that were not mentioned before the election and suddenly impose them on the Australian people.
Gilbert
Richard, the numbers are already finely balanced in the senate aren’t they? So this could have real ramifications for the legislative agenda of the Abbott Government.
Denniss
Absolutely and look I think, first thing’s first, unfortunately I think it’s good we’re having a re-election, I think we should always be 100% certain when we count our votes and I agree, it’s a debacle what’s happened but this is a regrettable but necessary step. Janet’s right, I think there’s going to be quite a big field of people running, I think it’s going to be a circus, but at the same time I think it’s interesting. It’s been a long time since we’ve had a Senate-only election and the way our democracy works, the Senate has an important role and the Lower House has an important role. Forcing people to vote on the same day for both typically means the presidential-style of a Lower House campaign means we don’t pay much attention to actually what the role of the Senate is. So, it’s not my ideal scenario for informing people about the Senate, but I actually think we’d be better off if we always had our Senate elections at a different time,
Gilbert
What do you think about the… because there is a chance that this could be the last election under the current rules because I know that both sides of politics have sent signals that they want to change the set up so to avoid the really tiny micro parties securing seats on a few hundred votes. What do you think about the idea of reforming that system in the first place?
Denniss
I think we have to, I think minor parties play an important role, I think micro parties play an important role, and in a democracy anybody should be able to put their hand up and say “vote for me.” But if we want our elections to represent the will of the public, let’s face it, the micro parties, the minor parties, the major parties have all got too good at the preference game. No one’s breaking the rules, no one’s breaking the law but everyone’s got too good at it and more work’s going into harvesting preference flows than communicating your platform to the public and I think a simple solution would be to pick a threshold, 2%, 4%, of the vote, and say if you can’t get over that threshold, you can’t receive preferences.
Gilbert
Surely the representation in the Senate should be judged on more than your preference whisperer, as the gentleman is called.
Ryan
I think we’ve got to take a step back here. Political participants and we’re all that, can sometimes get a bit too ahead of ourselves, and I start from the point where people all know what they’re doing on a ballot paper, and that’s an important starting principle. Can I say I think we’ve also got to be careful about changing electoral laws. Our High Court has taken a very, very, finicky approach to how they look at electoral laws being changed. For example, they said that prisoners can enrol to vote when Parliament said otherwise and there was no real Constitutional principle at stake. So I wouldn’t leap to any conclusions about profound changes to the Senate. I think it’s a risk for political parties, but also it’s got to get past a pretty high bar at the High Court.
Gilbert
Ok, and of course there was that famous micro party a few years ago, a man by the name of Nick Xenophon, who has gone on to win enormous amounts of Support in South Australia. We’re out of time tonight. Senator Scott Ryan, Janet Albrechtsen, Richard Denniss and Amanda Rishworth, thank you all for being here, it’s been fun. That’s all for the Nation I’m Kieran Gilbert, we’ll see you next time.
(Ends)
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