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Minister Truss and the Press Club address

Minister Truss addressed the Canberra Press Club today and it took over 20 minutes before any remarks relating to aviation were made.

The remarks were about Badgery’s Creek, without relating to the relationship of aviation within the context of broader impact of regional, national and international importance.

Lots about roads [which we know to be important], but nothing about how aviation interacts into the rest of the system.

It is more than disappointing that the reporters present were more interested in the political day than getting to the heart of the issues that we all know drive the movement of people, ideas, finance all around Australia, the dis-connect is alive and well.

The influence of the HOD [Mrdak] is again evident by steering the Minister away from anything that may be controversial.

Here’s the question that was not asked today:

Question proposed to the National Press Club on 30th April 2014

Mr. Truss

Given that your Department is such a large organisation and has a very wide range of responsibilities, of which aviation forms an important part, with over 75 million single journeys on the majors, supported by a wide ranging industry scattered through most small and intermediate size towns:

a. Are you considering appointing a responsible Minister to oversee this area??

b. How are you going to re-gain the confidence of the aviation industry??

c. When will you be up-dating the Civil Aviation Act and regulations to meet the requirements of the Abbott government to reduce red-tape and regulatory impact on industry?

d. What are you doing to rein in the excesses of the regulator – CASA [Civil Aviation Safety Authority]?;

ACTUAL Questions at press Club:

Transcript – National Press Club Address – Q&A Segment

 30th April, 2014
LAURIE WILSON: Time now, of course, for our usual round of questions from our media members, and the first one today comes from Amelia Brace from the Seven Network.QUESTION: Good afternoon. Amelia Brace from Seven News. In terms of paid parental leave, there’s been a lot of resistance from the Nationals. Are you happy that the Prime Minister has backed down and do you think that he’s gone far enough?

WARREN TRUSS: Well, our work in putting together this year’s Budget is particularly difficult. We face a huge debt that I referred to previously. That’s placing an interest burden on all Australian taxpayers. The previous government have left to us a financial legacy that we have to try to manage, fund as best we can, or ensure – and ensure that programs are administered as efficiently as possible. On top of that we’ve made a range of election commitments ourselves, commitments which we intend to honour with the Australian people. That involves new spending, some new programs and some priorities that we have for future of our country.

So it is necessary in this kind of budget process to look at every potential item of expenditure. And the Prime Minister has indicated today that he’s also prepared to look at something that was very near and dear to his heart and supported by a very large number of Australians, namely the paid parental leave scheme. Now, his indication that he’s prepared to look at modifications to that program is a demonstration about how far reaching we are going in endeavouring to make sure that we deliver the best possible benefit for all Australians in this Budget.

Can I just add one other comment, however, about paid parental leave: it seems that most of the public comment has been on the less than 1.77 per cent of people who earn above $150,000 a year. There aren’t many, if any of those, in my electorate. What the focus in my electorate has been on, what this scheme offers to people on lower incomes, especially people struggling in small business, a husband and wife team who might want to interrupt their business and not able to do so to have a family. Those who are on low incomes on the farms or in other areas of industry where they simply haven’t been able to afford a break in their two incomes to be able to actually have a family.

Now, many of these people will have their incomes actually raised under the paid parental leave scheme to the weekly earnings. Now, that gave them an economic opportunity – that gives them an economic opportunity to have children, which was simply not available without this kind of support. So this scheme was an important industrial relations workplace initiative. I think it can still contribute, even in a modified form, substantially to building better workplaces and ensuring that we give families the support they need particularly in those early times following childbirth.

LAURIE WILSON: Question now from Paul Osborne.

QUESTION: Paul Osborne from Australian Associated Press. Thank you very much for your speech. I’ve got a double-barrelled question. You’ve been involved in at least 10 budgets, I think, by my reckoning, under the Howard Government. It’s been a long time. Just wondering how the current process under Abbott and Hockey has been different to that under the Howard-Costello era. And my second question is more specific. What’s the strategic direction you’re taking with the aged pension? How do we get that under control?

WARREN TRUSS: Certainly each budget is different and the contrast between this budget we are working on now and the last one or the last three or four in the Howard Government is enormous. The struggle in those latter budgets was to find ways to deal with the excess of revenue over expenditure. Finding new projects, new worthwhile things to do when we had quite a liberal availability of revenue and, of course, no interest and no debts to be dealing with.

This time it’s obviously different. It’s probably closer to the first Budget that the Howard-Costello Government had to bring to the Australian people, dealing with similar issues of debt commitments that were beyond the capacity of our nation to pay and trying to find ways to share the burden evenly amongst all Australians so that everyone makes a contribution to repairing the economy and helping to build a better country.

One other point I would make is that Tony Abbott and I have sat through all of the ERC meetings. Traditionally expenditure review committees are led by the Treasurer but this was such an important part of the beginning of our term of government and setting our agenda for future that the Prime Minister has added his presence to all of the meetings and I think that’s helped make the business process work well. I think those that have been commenting about this ERC have commented about how business-like it’s been and how it’s systematically gone about making decisions in a logical way.

Some of them have been very hard. I don’t think too many ministers have left the ERC happy with the outcome, but we all know that we have to make a contribution to help build a better future.

QUESTION: [Indistinct] re: aged pension.

WARREN TRUSS: Well, as I said in my remarks, people – most Australians have worked through their lifetime in the workplace expecting that there would be a safety net, the aged pension, available for them on retirement. And w want that dream to be realised for particularly those lower income people in the community who have not, for one reason or another, been able to put aside superannuation or a sufficient retirement nest egg to care for themselves in the future.

I think one of the ways looking into the future that that goal can be achieved is to ensure that really those – only those people who need the pension actually receive it. It probably comes as a surprise to ordinary Australians to know that you can actually have over a million dollars in the bank and still get a little bit of aged pension and on top of that, of course, get the health care card and a number of side benefits which people in retirement find very valuable. You can own very, very expensive houses, and so long as you live in it, it’s not counted in the assets test. So there are some key issues that I think need to be addressed in future policy.

We’ve indicated that we will be honouring our commitments in relation to the aged pension, but clearly, the years ahead will need to be spent in ensuring that the pension is sustainable. So it is there for those who genuinely need it. But there will be a growing and continuing expectation that those who are able to put aside for their own retirement should do so.

LAURIE WILSON: Joanna Heath.

QUESTION: Joanna Heath from the Financial Review. Farmers and other groups are feeling nervous that the fuel tax credits scheme, which is worth $12 billion over four years, is up for cuts in the coming Budget. Is there anything you can say to reassure them and can you justify keeping such an expensive scheme in tight fiscal times?

WARREN TRUSS: Well, I don’t want to get into the business of confirming or denying anything, because even if I deny things that are not going to happen, that just raises an expectation that some other things will happen. But certainly, the farm sector in Australia is one of the few in the world that actually pays full price for fuel. Other parts of the world subsidise fuel. It is true that it’s been free of excise for a very long period of time and that’s the way we’d like to keep it. We want Australian farmers and, indeed, Australian industry to be as competitive as we possibly can around the world, and that means keeping costs low for everyone.

LAURIE WILSON: Sid Maher.

QUESTION: Sid Maher from The Australian, Mr Truss. I just want to pin you down on a couple of things if I can. So on the diesel fuel rebate, that is, can we get a specific yes or no about whether it will be maintained, because there is speculation, there is speculation every year, and I know that John Anderson when he was National Party Leader wrote out his resignation when John Howard wanted to do it. So are you prepared to do that if that’s on the cards?

Now, also on the paid parental leave team, what is your position on the paid parental leave scheme? Will you put the final details to a vote of the National Party party room of federal MPs and senators, and will you be bound by the vote of the National Party party room?

WARREN TRUSS: Well, the National Party dealt with this way back before the last election. We dealt with it at the time that it was first announced and we indicated that it was Coalition policy, we’re part of the Coalition, and we support the election of the Coalition Government. So that is our party room positive. We have already dealt with it in the party room. And while I’m in that mood, I’ve already answered your previous question.

LAURIE WILSON: Right. We’ll move on. The next question, Roger Hausmann.

QUESTION: [Inaudible] for Inside Canberra. Now that we’re all reasonably relaxed and you’ve outlined a beautiful program, can you perhaps share with us how you’re going to actually deliver the detail? As you know, the previous government had some great schemes, but they couldn’t actually deliver the details.

WARREN TRUSS: We are very conscious of the fact that the infrastructure program that we are committed to is a big one and that the logistics of delivering a program of that nature are substantial. We also need to deal with the vagaries of our three tiers of government system. We are heavily dependent clearly on states to do planning and delivery work of most of these major projects and our cooperation with local government to deal with roads and other projects at the local level.

We also intend to make much greater use of the private sector. It’s obvious that many of these major projects in the capital cities in particular, but increasingly also in the country, are going to be designed, planned and built and funded largely by the private sector. And we will therefore expect to use the best available expertise anywhere in the country, both from within governments and outside of governments.

And let me also refer to a part of the rationale for this major infrastructure development program that we are progressing at the present time. There has been major construction work in the mining sector now for a decade or two. Many of those projects are coming to completion. In a city like Gladstone, for instance, where there are three large LNG plants under construction, all of them have got only a year or so before they will be in full production. They will be producing revenue then for the country but the construction jobs will no longer be required on those projects.

So we believe that there will be a substantial pool of construction skills available to undertake other projects fairly soon and that’s the reason why we think it’s important to have major infrastructure projects ready to go to take advantage of those skills when they become available.

LAURIE WILSON: Next question from Michael Keating.

QUESTION: Michael Keating from Keating Media, Deputy Prime Minister. My question is will the $40 billion you say will be used for major infrastructure projects be quarantined in the Budget, such as defence spending has been, and not be affected by future Budget cuts?

WARREN TRUSS: Well the 40 billion and other infrastructure announcements we make are about specific projects with specific budgets, so we intend to deliver those projects and we will get on with the task. There’s no plan to move this money elsewhere. It’s there, it’s been budgeted for infrastructure purposes. It’s not dependent on a mining tax. It’s money that we intend to devote to what we believe is important projects which will help build a stronger nation.

LAURIE WILSON: Tom Connell.

QUESTION: Tom Connell from Sky News, Deputy Prime Minister. You spoke about this job of the Budget and a few ministers being disappointed. They’re trying to find a way to get the Budget under control, in your words, to try to deliver a surplus ultimately, but that’s also against the backdrop of no new taxes, promises made by Tony Abbott in various forms, spending on the NDIS, defence, education and so on. Is the crux of the issue here the fact that Tony Abbott didn’t keep to his mantra of under-promising and over-delivering?

WARREN TRUSS: Well, the task is difficult and we have growing expectations in our society. We made commitments that we fully budgeted for and which we outlined prior to the budget in detail about where the money was going to come from. Now, it is a fact that our capacity to deliver some of our projects on the schedule that we intended and some of our programs on the schedule we intended has been hindered by the fact that we can’t get the repeal of the mining tax and repeal of the carbon tax through the Senate.

Those burdens, those costs, they should be out of the way by now and we should be moving towards the situation where we can implement our own replacement programs. But that has been hampered and delayed because of the inability to get these things through the Senate at the present time.

If the Opposition wants to be slightly helpful to us in delivering a good agenda for the future and helping to get on with the task of repaying the debt that they’ve left behind, then the best thing they can do is to make sure that the mining tax and the carbon tax are repealed just as quickly as possible, and that will then give us the capacity to get on with our job.

LAURIE WILSON: James Glenday.

QUESTION: James Glenday from the ABC, Deputy Prime Minister. I just wanted to know how much money you have set aside for new infrastructure project announcements in the lead up to the Budget or even on Budget night? And of course paying for this $40 billion worth of infrastructure is expensive, do you support a debt levy or a debt tax to pay for that?

WARREN TRUSS: Well, I’ve indicated and we’ve announced I think most of the projects that are in that $40 billion commitment, and they are funded and provided for within our budget context. They’re not all in the first year, obviously. It’s a 10 year program that we’re talking about. So we will need to make sure that that funding is available at the right time, that we have got sufficient funding on the income side to be able to undertake our expenditure programs.

No new ways of raising funding are popular. Everyone wants taxes to be lowered. We are a low-tax government. That is our philosophy. We want to have a situation where Australians pay less tax rather than more tax. We can’t deliver all of that overnight. Some things are going to be longer term objectives, some things we can do just as soon as we are physically able.

But the reality will be that we need a budget that balances, that means we need a budget that’s got sufficient income to meet our day-to-day expenditure but also to start on the task of repaying some of the debt and ensuring that the debt doesn’t continue to grow just out of hand and pass to future generations a legacy of debt that becomes insurmountable. So we look at all of the revenue options just as we look at all the savings options.

LAURIE WILSON: A question from Rob Harris.

QUESTION: Rob Harris from the Weekly Times, Deputy Prime Minister. You touched on the free trade deals in your remarks and in particular dairy farmers and rice growers and, indeed, some of our own MPs were disappointed with some of the details and final aspects of the trade deals. As a former ag and trade minister, do you think perhaps they underestimate the difficulty there was coming to those agreements or do you acknowledge perhaps they didn’t meet expectations set?

WARREN TRUSS: Well, I think Andrew Robb has done an extraordinary job to deliver these two major free trade agreements in just seven months. That’s truly remarkable. And I think any judgment, any assessment of the agreements would be that they make very, very substantial progress. They are genuinely comprehensive and they deliver major benefits to Australia.

The Korean free trade agreement has been fairly universally welcomed by the Australian agricultural sector as well as other parts of the economy. In particular, what it’s done for the beef industry, sugar, sugar is often the forgotten industry in free trade agreements, but Korea is our number one sugar customer and here we have a free trade agreement which substantially reduces barriers to imports of Australian sugar. So there’s been an – I think the Korean free trade agreement was one of if not the best free trade agreement Australia has ever negotiated.

Now, in the case of Japan, it’s important to remember a bit of the history. Our current commerce agreement with Japan was signed just a few years after World War II. It was a very heroic agreement at that time and ground-breaking, but it hasn’t changed much since that time. It was sufficient to underpin a growth in our trading relationship with Japan that took Japan to our number one trading partner within about 10 years and it stayed up until a couple of years ago.

So there have always been particular difficulties in dealing with agricultural trade to Japan. No country has been able to negotiate any kind of universally free access for agricultural products into Japan. Indeed, what has been achieved in this agreement for Australian agriculture with Japan is way beyond what any other country has managed to do.

Now, there are significant helps for beef and a whole range of industry. Yes, I sympathise with rice. Rice will probably be, and the industry knows it, just about the last thing that we’ll get into Japan. I don’t excuse that in any way. Rice has always found it difficult to break into new markets in other countries.

Now, the sugar industry, some elements of it have been disappointed with the outcome of the Australia-Japan free trade agreement because they’re left effectively with a 67 per cent tariff on sugar. Now that is disgusting. It is far too high. It’s not the sort of number that Australians regard as acceptable, but before this agreement it was 105 per cent, so it’s a significant improvement. And so this is very much a glass half full or glass half empty story.

A lot has been achieved in both the Korean and the Japanese free trade agreement. We would naturally think of some things that we would have liked to have been bigger and better, but I think any fair minded assessment would have to come to the conclusion that they have both been major advances and a real credit to Andrew Robb and his team.

LAURIE WILSON: Let me ask you a question now. Over the last half a century, perhaps longer, but there has certainly been a dramatic reduction in that time on the amount of freight that’s travelled – carried on our roads versus… sorry, carried by rail versus that on the roads. The proportion is now very small for the rail freight. You’re putting more money into roads which will presumably only mean the trucks can travel on them more easily, more readily. You’re also putting money into rail, of course, as well but do you have any sort of target as a government for trying to increase that proportion of freight that is carried by rail?

WARREN TRUSS: Well, I think that’s a really excellent question and it’s an important policy area that we need to address. Yes, it’s in the interests of the whole country for more of our freight to be carried by rail and for that matter by coastal shipping. You know, it’s particularly disappointing that coastal shipping’s share of our freight task continues to slip away. That ships, international vessels, travel from say Perth to Melbourne and don’t take any Australian domestic cargo with them while they’re on that journey. Now, I mentioned the paper that we – the discussion paper we are undertaking in relation to domestic shipping in Australia and hopefully it will address some of those issues.

With the upgrading and improvements to the cross-continental rail line, rail now does take the biggest part of the freight load from Perth to the eastern states. There had been a time when even that share had slipped away and trucks were crossing the Nullarbor in much greater numbers. So with better management and improved infrastructure, rail has been able to win back market share. The ARTC over the last six or ten years has been substantially in upgrading the Melbourne to Sydney, Sydney to Brisbane line, and so they’re now able to operate more efficiently than in the past.

And there are some really good success stories of rail winning back market share. It’s disappointing that rail carries so little of the freight task within states. Particularly, perhaps, in Queensland, where the coastal rail network is not as busy as it ought to be. I have no doubt that the Melbourne to Brisbane rail line will revitalise long distance rail haulage on the eastern seaboard. The Queensland Government has asked ARTC to look at whether it might be willing to take over sections of the Queensland track and make that a part of the national system. So there’s a lot of good, progressive things happening. But I think it is a critical part of what we’re doing in relation to meeting the demands of our future transport task that rail delivers much more.

And the other thing I made a number of mentions of in my address were the work that’s being done to connect the rail to the ports. So that we’ve got much better connectivity from the production sector to the ports which take our products to other parts of the world, through better investment also in intermodals so that we’re better able to handle some of the cargo that comes from other parts of the world or what we’re sending to other countries.

LAURIE WILSON: I’ll take a question now from Steve Lewis.

QUESTION: Mr Truss, Steve Lewis, Press Club director. Can I ask you a question about Infrastructure Australia? In your speech you hailed the decision on Badgerys Creek, which came after decades of intransigence by governments. That was a decision that required political resolve, political muscle, and yet Infrastructure Australia, you say, will be independent of government. Isn’t the brutal reality that contentious infrastructure like Badgerys Creek, like the dual carriageway of the Pacific Highway, will never get done unless governments, whether they’re Labor or Coalition, actually get behind them? Will this government have a veto power over decisions taken by IA?

WARREN TRUSS: Well, obviously decisions that are made are ultimately made by a government, but the purpose of Infrastructure Australia is to cast light on the economic benefits of a particular project. And to prioritise which projects deliver the best economic results. Ultimately though, a government will make a decision and sometimes they may make a decision that a project will proceed even if it doesn’t meet a full value BCR, because it’s necessary for social or other economic reasons. And that’s a right that, I guess, any government will always reserve for itself.

However, those decisions then can be judged by the public on the basis of a published review of the value of that particular project. But I think the most important thing we want to do about Infrastructure Australia to make it more useful and make a better contribution in the future is to have it making its decisions and its assessments before the government actually makes the decision. We want to develop a 15-year infrastructure program so that it’s out ahead of the decision-making process.

Now, under the previous government, I don’t think there’s a single project that the government announced after it had gone to Infrastructure Australia. They’d already made the announcement, then Infrastructure Australia spent all its time playing catch-up. Assessing projects where the decision had already been made. Now, we’ve also been making announcements and we therefore want to get Infrastructure Australia into a position where it’s ahead of our decision-making process and that can only be done by getting 10, 15 years ahead of the decision makers and the deal makers who are deciding in discussions between Commonwealth and state governments or with the private sector just which projects are going to proceed.

So this is the fundamental reform that we’re proposing. Firstly to make Infrastructure Australia independent – and not just simply someone that will just do the will of the minister, but independent, making its own decisions, publishing its own judgements. But to guide decision making by being out there in front, having already assessed the next level of projects that need to be brought forward and having them value-judged to guide the decision-making process.

LAURIE WILSON: Ken Randall.

QUESTION: Mr Truss, Ken Randall from iSentia and also from the board of this club. Both things are linked. I’d like to ask you, first of all, well, thank you for being here today. But it does emphasise the paucity of speakers from the Government that we’ve been able to get in the last seven months. Have you been running a deliberate evasion campaign in the Coalition and if so, why? And the second question I’d like to ask you is this. There’s a growing body of commentary from not just – not necessarily from the press gallery but from economists now saying that the whole budgetary situation is being blown out of proportion; that by international standards and even by our own, it’s not that bad, and the warm-up process for this Budget is not going to please anybody at all once the product’s produced.

WARREN TRUSS: Well, there certainly has been a lot of speculation about what might be there and what might not be there, and we’ve still got how many days yet to go?

LAURIE WILSON: Fifty-nine.

WARREN TRUSS: So I can’t imagine there will be any subject left by Budget night that there hasn’t been speculation that it’s either in or out or it’s cut or it’s growing. And frankly, that’s, I guess, something you have when you have a free press with a lot of newspapers to fill. There has to be a new story every day, and I expect there will be more speculation. I think the attitude however that things are not too bad that we can just let it go on, that we don’t have to worry about the debt, that is the language of future disaster.

We’ve got to keep on top of our capacity to pay. The interest bill is real. The interest bill is real. Just now, the $12 billion in interest that we’ll have to find in this Budget would’ve built us a big new hospital in every capital city. It would’ve built half the roads that I’ve been talking about today. It would’ve enabled us to do everything we want in Gonski and Disability Services, et cetera.

Our capacity to deliver those things will be limited by the fact that the very first call on the Budget – very first call on each dollar of tax revenue – will be to make a contribution towards the interest and redemption of the debts we’ve inherited. So we cannot let that go on and assume it doesn’t matter. It matters for future generations. They will be denied services and facilities that they should have because they’re paying interest and redemption on the bills left to us after the last six years.

Now, I’m sorry you haven’t had more speakers from the Coalition to the Press Club. I’m happy to come from time to time.

LAURIE WILSON: We’ll be happy to have you back, too.

WARREN TRUSS: You’ve been very kind to me today and I certainly look forward to meeting with you from time to time and I’m sure that there will be plenty of other Coalition speakers who’d be happy also to contribute.

LAURIE WILSON: I’ll take a final question today from Peter Phillips.

QUESTION: Mr Truss, Peter Phillips, one of the directors of National Press Club. I add my welcome to Ken Randall’s to you, for helping us to break the drought of – the long drought of government speakers, and we certainly look forward to more from the government as time goes on. Starting obviously with the post-Budget speech a fortnight from now. But to come to the question, I know we can’t ask you to talk in specific terms about the Budget, and I wouldn’t expect you to, but in broad approach and in policy terms, can I ask you what you will do – what you intend to do, what you plan to do in relation to the essential element of foreign investment, and most particularly Chinese investment and most particularly within that Chinese state-owned enterprise investment in Australian infrastructure development, and in Australian agricultural project and agricultural expansion development?

WARREN TRUSS: Well, I – clearly Australia will continue to need foreign investment. We have limited capital in this country, and yet we’ve got great ambitions about what we want to do to bring – to market our raw materials, to help invest in manufacturing, education, and all of the other things that we want to be a part of our economy in the future. So there will be a need for foreign investment into the future.

However, we as a nation want to ensure that all foreign investment is in our national interest. We want to make sure that those who invest in this country actually contribute towards building a bigger country, and a better country, and add to our economy and not just simply take advantage of the skills and the resources that we have to profit other parts of the world. So we want to benefit from the investment that’s made in this country, and that’s why it’s appropriate that there should be a Foreign Investment Review Board that

examines proposed investments in detail. Whether they come from the private sector or in the vexed area of government-owned enterprises.

We made – we went to the election with a clear commitment about what we wanted to do in relation to scrutiny of foreign investment, and once we’ve got the Budget out of the way we’ll want to introduce that legislation into the Parliament to make it happen as soon as possible. In the interim, each project needs to be judged on its merits and we will welcome investment that’s good and in the interests of our country. But if it’s not perceived to benefit our country, well then it’s something we can do without.

LAURIE WILSON: We’ll conclude on that note. Thank you very much, Mr Truss. Deputy Prime Minister, thanks again. Thank you very much. We do appreciate you making the time today, and we certainly do look forward to inviting you back again in the future. Thank you very much again.

[ENDS]