Budget, Measures

Wayne Swan - Shadow Minister for Family and Community Services

Interview

Transcript - Lateline ABC TV - 17 May 2002

E & OE - PROOF ONLY

TONY JONES: Tony Abbott, two snapshots of the Budget reaction on talkback radio - an elderly pensioner reduced to tears on John Laws over how she's going to pay the extra costs for her medicines and Alan Jones reads out an email from a man with a disabled son asking if the Government would be happier if he simply shot the boy. Now Peter Costello surely didn't intend to sow fear among the poor, the sick and the lame, but that's what's happened in the end. Do you regret that?

TONY ABBOTT, WORKPLACE RELATIONS MINISTER: I don't think that Peter Costello has sown fear, but I think that other people, some of whom should know better, have been sowing fear and that's the problem. We do need to tackle the blow-out in the pharmaceutical scheme. We do need to tackle the blow-out in the disability support pension, as Labor knows, as everyone who thinks about these things knows and unfortunately there is no easy way of doing this. That's the problem the Government faces.

TONY JONES: Wayne Swan, how do you answer the charge that Labor has effectively whipped up a fear campaign?

WAYNE SWAN, SHADOW COMMUNITY SERVICES MINISTER: No, the Budget is in effect a very scary Budget and you've got a Government that's in the mode of being very mean and very negative. They are going to cut the disability support pensions of 200,000 disability support pensioners by $52 a fortnight. Secondly, they'll put up the costs of medicines for some of the poorest people in the community and families substantially by about 30 per cent. Thirdly, they have claimed there is a lot more money for disability services and there clearly isn't. There's not a new dollar for extra services and that's why Alan Jones is so upset with the PM and the Government. There's no scare campaign from us. What is scary is Government and their Budget.

TONY JONES: Tony Abbott, perceptions are very important in politics, and a Government that lives by talkback equally dies by talkback. Aren't you worried about the perceptions that are out there?

TONY ABBOTT: Well, of course I am, Tony. But no democratic government lightly does things which are easily turned into a scare campaign. We're only doing this because we know and Labor knows and all the thoughtful commentators know that something has to be done to tackle this constant cost blowout. When you've got for instance, a suspected Al Qaeda terrorist on the disability support pension, our taxpayer dollars at work are keeping someone working for Al Qaeda. You've obviously got a problem and you need to address it.

TONY JONES: By the way, that is an allegation that he worked for Al Qaeda. You can't state it as a fact.

TONY ABBOTT: I said a suspected Al Qaeda terrorist.

TONY JONES: Wayne Swan, briefly.

WAYNE SWAN: That's an outrageous slur on the 650,000 disability support pensioners in this country.

If this Government has a compliance problem and it can't crack down on fraud, it ought to come out and devote more resources to it because the Budget is not about fraud. The Budget is about cutting the pensions of these people. That's why it's so mean and nasty.

TONY JONES: Tony Abbott, at the end of the Budget week, three of your key initiatives are doomed. They'll be rejected in the Senate. Simon Crean says he wants to work with the Government to sort out a better way of doing this. Are you prepared to sit down with Labor over these issues and sort through some new way of doing it?

TONY ABBOTT: Simon Crean wants the Government to agree with him. Simon Crean's problem is that he hasn't quite worked out who won the election. It's the job of the Government to get on with managing the business of managing the nation and unfortunately all Simon Crean is on about is wrecking. As anyone who listened to his Budget reply would know, Labor's very good at spending money, but it hasn't got a clue about how to raise money and raise money responsibly.

TONY JONES: But you want these measures to go through the Senate. I mean, if you were able to sit down with Labor or indeed the Democrats, you might find room for compromise. Don't you think the public, with such controversial measures, would like to see bipartisanship on these issues?

TONY ABBOTT: Labor has always said that the Government's Budget ought to go through. Yet, here it is now taking a whole range of Budget-wrecking measures and I think this is very much against the spirit in which the Labor Party has traditionally operated and this is new modern, irresponsible Labor that we're seeing in evidence now.

TONY JONES: Let's put that to Wayne Swan. Was Simon Crean serious about working with the Government, or is it just opportunism?

WAYNE SWAN: Simon Crean has put forward a positive set of proposals for reform, both in the area of the disability support pension and in pharmaceutical benefits and in superannuation. What Simon Crean put forward were funded proposals for reform and we're quite happy to sit down with Minister Abbott, the PM and the Treasurer and work out reforms. But we're not going to go and vote for measures which are going to hurt people in our community when the Government is in direct breach of election promises. Our first job is to hold the Government accountable and we will do that with all the strength we can muster. But we'd also like to see long-term reform, particularly in the area of welfare reform. This Government junked welfare reform in this Budget and they are reaping the benefits - reaping the costs of all of the cuts they've made in social security in recent times. We've got a positive set of proposals for reform, and we would like to sit down with the Government on a bipartisan basis to solve some of the long-term problems but they're so negative, they won't be in it.

TONY JONES: Tony Abbott, go ahead.

TONY ABBOTT: I think the sad truth, Tony, is that Labor believes in magic pudding economics and unfortunately you just can't have a magic wand approach to everything.

TONY JONES: What about this idea of bipartisanship? Here we've got your Opposition counterparts saying, "We'll sit down with the Government and work our way through this". Getting back to that point about the public, don't you think the public would quite like to see bipartisanship? These are very controversial measures.

TONY ABBOTT: Yeah, but someone who stands up there and constantly accuses the Government of bad faith, of active malice, of trying to rip off the Australian public, is not interested in real negotiations. That's the basic problem. If Simon Crean had stood up on Thursday night and said, "Look, I accept that these are difficult problems. "I think that the Government has gone a bit too far here but yes, we do need to tackle the issue. "I appreciate the PM and the Treasurer are doing their best under difficult circumstances, but I think we can improve on it," - fine. But no-one who saw Simon Crean in action would think that was his view. Instead, we just saw the usual sneering, snarling former trade union official having a go.

TONY JONES: Wayne Swan, could there in reality be a compromise or a deal? Let's start with the Budget plan to raise the cost of drugs. You've ruled that one out completely, haven't you? How could you go back to it?

WAYNE SWAN: We ruled out the increase in the price that the Government has brought forward. But we agree there are longer-term structural problems in the scheme and in his Budget reply, Simon Crean outlined how we would approach this problem. Similarly, in disability support pensions. We agree there's a long-term problem here which requires the type of approach which is recommended by Patrick McClure.

TONY JONES: Go back to the drugs issue for a moment. Would you rule out a smaller increase, because Labor has done this itself in the past, as Michelle Grattan pointed out today, in 1990 the then Treasurer Paul Keating raised prescription charges by $4, using exactly the same argument the Treasurer is using today.

WAYNE SWAN: On that occasion, John Howard said he wanted to vote them down because his job was to keep the Government honest. That was his view at that stage. But Tony Abbott and John Howard have made fools of themselves carrying on in this way. We have said there are two Budget measures which don't mean blocking supply which need to be made much fairer. Simon Crean put forward costed proposals last night. He identified areas of waste and mismanagement and substantial changes where we could do something in the long term.

TONY JONES: Let me bring Tony Abbott into it.

TONY ABBOTT: He didn't put forward costed proposals. He reckoned you can pay for all the extra spending on defence and border security by cutting out advertising and the use of consultants. I mean, this is fairyland.

WAYNE SWAN: This is the other great furphy that we're getting from the Government - that somehow it's the cost of security which necessitates these cuts. The fact is that the Government has brought in a deficit of $3 billion, which has been brought about by their spending spree to save their political hides at the election, and then they want to have cover for that by saying, "We've got to cut the poor, the disabled and families when it comes to drugs to make up for the defence of the country". That's just not the case.

TONY JONES: Alright. Let me bring Tony Abbott back in. Raising the cost of drugs was always going to be controversial. You must have realised it was very unlikely to get through the Senate?

TONY ABBOTT: Well, no. We thought that a responsible Opposition would be prepared to understand and accept that we need to do something, just as back in 1990 the then Opposition then ultimately supported what the then Government wanted to do. We thought that the current Opposition would support what the current Government wants to do. But no, I'm afraid responsibility and Labor are two alien concepts.

TONY JONES: Tony Abbott, let's move on if we can. The disability pension changes - are they being driven by the belief that there are malingerers in the system? You alluded to this earlier on and if there are, what percentage of people, for example, with bad backs do you think are malingering?

TONY ABBOTT: As Mark Latham said Tony, the disability support pension has become a kind of alternative dole for people who really should be encouraged to stay in the labour market. Now as Mark Latham said, it's impossible to believe that one in eight men over 50 are disabled. They're not. So we do need to reform the system and we're proposing to go about it by saying that if you are capable of doing 15 hours of work a week at award wages or better, at least in principle you should be still looking for work rather than on a disability support pension.

TONY JONES: Wayne Swan, the disability support pension has blown out even more than the PBS. Now I presume that Labor is in favour of the concept of welfare to work, given what we've just heard Mark Latham has been saying?

WAYNE SWAN: Well, we've been talking about a positive program of welfare to work for a long time, of rewarding work over welfare and of investing in the capacity of people to work, of investing in their rehabilitation and skilling. The Government hasn't been doing that. They've been cutting back and that is partly responsible for the blow-out in the numbers. But to go back to basics, you don't have to cut someone's pension to help them get a job. You see the Government doesn't want to talk about what it hasn't been doing to assist people to move from welfare to work. What it is on about is punishing people on low incomes. This Government believes that you motivate wealthy people by giving them financial incentives and you motivate poor people by giving them financial punishment. What this is doing is cutting a gaping hole in our social safety net. It's an ideological obsession that Tony Abbott and his mates have had since 1992.

TONY JONES: Wayne Swan, let me put this to you. You've talked about compromise, about sitting down with the Government. Where would the compromise be on the welfare-to-work scheme? What would you want to do and we'll see whether the Government will counter it?

WAYNE SWAN: We would sit down and make our starting point the proposals that we put to the McClure committee and we would start with the McClure report and we would work our way through all those issues. You see, it's Government that has dropped the McClure report, which it announced with great fanfare in the Budget before this one that was the solution of the problems between work and welfare. They dumped that in this Budget. We'll start with the McClure report. We'll start with the organisations who work in the area and we'll come up with a solution. Everybody recognises there needs to be reform. That's why we've called for bipartisanship, not punishment and pension cuts.

TONY ABBOTT: On the one hand, he calls for bipartisanship and on the other hand he calls us a bunch of absolute monsters who are out to impoverish the Australian people.

WAYNE SWAN: You certainly are on this issue, Tony; I've got to say you most certainly are.

TONY JONES: But this is a question of political language we're talking about here. Let's get down to tin tacks. If Labor were to bring the McClure report back to you and say, for example, "Would you countenance bringing in what McClure recommended, a participation payment, actually more money being given to people on disability pensions to go into work to encourage them into work," would you agree to that?

TONY ABBOTT: That's not quite right. What McClure talked about was unifying the current Newstart Allowance and the disability support pension and this question of whether you unify up or unify down or unify in the middle was left open by McClure. But certainly what we have done in this Budget is we've allocated an extra $258 million to employment services and rehabilitation programs for those people currently on the disability support pension who we think might.

TONY JONES: But we get back to the political reality here. Unless you make some compromise or deal with Labor or the Democrats, this simply won't get through the Senate.

TONY ABBOTT: This really comes down to this question: who governs the country? And the Australian people decided last November that they wanted John Howard and Peter Costello and the Coalition to govern the country. And Labor is still in a state of denial about its election loss.

TONY JONES: Wayne Swan, in reality is this the first real chance Simon Crean has had to attempt to win back some of the battlers which you lost to the Howard Government over previous elections?

WAYNE SWAN: I guess the first political point to be made here is this Government doesn't defend the battlers, it creates them. And you couldn't get a better example of that than this proposal to cut the pension of 200,000 people, directly in breach of a promise that the PM gave before the election that no benefit would be cut.

TONY ABBOTT: We're not cutting benefits.

WAYNE SWAN: You certainly are cutting benefits, which is why Amanda Vanstone let the cat out of the bag in the Senate yesterday and acknowledged for the first time you were cutting benefits. That's 200,000 people.

TONY ABBOTT: We're not cutting benefits.

WAYNE SWAN: You are cutting benefits.

TONY ABBOTT: The rate of the disability support pension is not changing.

WAYNE SWAN: Tony, you are doing what Patrick McClure recommended against. The whole talk of a common unified payment was always on the basis of not going down to the lowest denominator, dragging people down.

TONY ABBOTT: There are some people on the disability support pension now who shouldn't be there, who should be looking for work.

TONY JONES: I'm sorry, both of you, we're just about out of time. A final quick question to Tony Abbott. This was a critical Budget for the leader-in-waiting. Does it reinforce his credentials for leadership or not?

TONY ABBOTT: I think it reinforces the fact that this is a good Government with a good Treasurer and a good PM.

TONY JONES: Alright, we'll have to leave it there. Tony Abbott and Wayne Swan, thanks to both of you for joining us on Lateline tonight. Thanks, Tony. Thanks, Wayne.