Telstra, Share Ownership, Economic Ownership, Ageing, IT, Mark Latham

Simon Crean - Leader of the Opposition

Doorstop Interview

Transcript - Liverpool, Sydney - 6 May 2002

E & OE PROOF ONLY

CREAN: ..and those community driven agendas in many cases are best represented by local government, particularly where they're activist local governments. So not only have I been meeting today but last weekend, the weekend before last, the seminar was conducted in this area for all of the municipalities, all of the local government areas to look at the broader package of infrastructure issues and at the end of this announcement today we'll be inspecting some of the site development associated with some of the important initiatives that the Liverpool Council has been developing. So the infrastructure issue, the physical infrastructure is terribly important.

So what I'm launching today is a paper that's been considered by the Shadow Cabinet, a paper considered for release today in terms of public input, public feedback. A paper that essentially goes to the means by which we can encourage the greater ownership of assets by the broad Australian public. Not just in the hands of the few but ensuring that the many get access to them. I want people to gain assets because I think in doing so they gain better security and control over their future lives, assets give that security, they also give people better choices. These are choices that at the moment high income earners experience but I want to be a Government that governs for everyone not just the top end of town. My belief, my firm belief is that the Liberal Party is not the party of broad asset ownership. It's only been when Labor Governments have been in power that we've seen the asset base spread to the many.

Mark's already mentioned the question of university access introduced under the Whitlam Government. What's the most important asset that you can give young people these days? It's an education. It's an advanced education, it's an education that improves your employability. But until Whitlam was in university education it was the province of the few, the wealthy. It was made available to everyone, not just under Whitlam, but under the Hawke - Keating Governments, where we expanded significantly the number of university places. I think from memory, because I was Education Minister at the time, the places when we came to office in universities was 150,000. At the end of our regime it had been increased to over 600,000. This was huge growth and huge funding that went into it. We also saw the importance of the regional universities, enabling people to study near where they lived so they could continue in their community. It was Labor that opened that up.

Similarly, if you take education and the importance of it as an asset to individuals, look at what the Hawke and Keating Governments did in ensuring the huge growth in the achievement of the secondary, of year twelve equivalence in education. When they came to power the numbers of people going on to complete year twelve was something less than forty percent. It was increased considerably to over ninety percent under the Hawke and Keating Governments as well as was the development of lifelong learning options. The Working Nation Program, which I had the privilege to implement and develop, that was a major commitment in terms of the expansion in vocational education and training.

So that was where an important access to an asset base, an entitlement was spread by Labor Governments, not conservative Governments, but by Labor Governments. Similarly with superannuation. Superannuation when Labor came to office was the province of executives of companies or the public sector, bluecollar workers, ordinary workers did not have access to superannuation. That was opened up again under Labor Government. The only time superannuation has ever been advanced and spread, has been under Labor Governments. The nine percent contribution that's now being made was the result of Labor initiatives When the Howard Government came to office they promised to keep the co contribution which would have taken over time, the superannuation contribution to fifteen percent. Their very first Budget they broke that promise and they've done nothing since to superannuation to advance it for ordinary people. These days fifty four percent of Australians own shares. Why shouldn't that be spread to the broad Australian Public?

We need to look creatively, in the same way as we've spread superannuation as an asset base for everyone. We need to look at creative ways by which we can spread share ownership to the broad Australian people. If it's good enough for share issues for chief executives and the executive level, why not the people who actually do the work? Why not the punters, real workers in terms of real companies? Now these are issues that I think deserve serious consideration. When I was Shadow Treasurer I took a proposal to the ALP Conference in Hobart to change the platform to encourage the basis for employee share ownership, this paper today opens up further the consideration of that option. And the other key area that we've got to look at is how we make owning the family home more affordable and more available to low income people. Not putting them on the treadmill of rent for the rest of their lives but looking creatively at means by which we can give them the kick start, the opportunity to own what's been considered the Australian Dream, but a dream that's been put out of the reach of so many because of the financial pressure that Australian families have been under. So that's what this paper is about today, just as we did on higher education, just as we did on superannuation we now have to spread the ownership to other assets like the family home, like shares and like the ability for people to create their own small businesses.

One of the great success programs that was introduced under the Working Nation initiative was the New Enterprise Incentive Scheme, a means by which unemployed people could capitalise their entitlement and under proper guidance, put it into running their own businesses. Do you know the success rate of that program was one of the most successful labour market programs, not just here in the country, but anywhere in the world? It was over eighty percent in terms of success. Now if we are to be the nation of more self employed, more small businesses, why shouldn't we be looking creatively at the means by which we encourage, help, train, assist and support more people having the option to start their business. But they were programs only ever supported, only ever driven under Labor Governments and they will be again.

So what this paper is about today is putting down for consideration a whole range of initiatives whereby we are seeking input, initiative that encourage first share buyer schemes, matching payments whereby we could look sensibly at Government contributions. Employee share ownership, investment accounts for children from poorer families, individual learning accounts, matched savings accounts that encourage people on low incomes to save and in the process rewards them for doing so. Programs to help poorer people buy their homes and improve the quality also for public housing and also looking at ways to boost investment in low income communities and help people start their own businesses.

Mark's paper today is the starting point for that consideration, but the message that I've tried to convey to you is that we need creativity if we're going to modernise ourselves, but the only time we've ever had creativity in the past has been under Labor Governments. I believe we can do it again, this paper is the starting point for it, but again it has to be done in partnership, a partnership with communities and a partnership with individuals. That's why the matching dimensions associated with a number of these proposals put forward actively encourages genuine reciprocal obligation. A preparedness to assist and work in partnership and do it through financial reward. These are smart suggestions, these are creative suggestions but they're only coming from Labor, so I invite you to contribute actively to the development of these policies. We want constructive input so that we can take practical proposals forward to the next election.

I thank Mark for his contribution, I think that people in the west of Sydney should also be thanking the Council for the way in which it has developed its agenda for ensuring that people can live, work, play and remain in their community, by providing and looking forward in terms of the provision of infrastructure and the like. That's a partnership that we're actively keen to develop as well. So I believe that off the back of these initiatives and working with local government we will have a package for the Western Suburbs of Sydney. But it won't be restricted to the Western Suburbs of Sydney because if we get it right, it will be available to all urban and regional communities. That's what partnership's about, that's what being in Government is about, putting forward the ideas, funding the programs, funding the initiatives that drive the agenda from the community base. That's what giving stakeholdership to individuals and their representatives in communities is all about and that's what modern Labor is about and this is another step forward in that initiative, in that thinking, in that policy framework. Thank you very much.

Yes, now we'll take questions, perhaps Mark you come up with us because there'll be issues that you may like to fire at Mark in terms of the content of it as well. Fire away.

JOURNALIST: Mr Crean, hasn't the privatisation of Telstra been the greatest demonstration of expanding share ownership amongst Australians…?

CREAN: It hasn't because in the process of selling the half off selling that off which was already owned by the Australian public, we have seen the run down in services. Now, I've said that in modernising Labor all policies are up for review but what is not up for review is the further sell off of Telstra. It's a public asset and public being connected which is the big challenge in terms of economic opportunity access to information, communication, this is what Western Sydney needs. It needs connectivity not further sell offs. I'm interested to note today that I understand that Ziggy Switkowski has attended the Cabinet meeting in Melbourne. I think this comes after Peter Costello's repeat statement yesterday that he intends to sell the rest of Telstra. I think it's a very interesting coincidence that the very next day the Chief Executive of Telstra is along convincing the Government, no doubt, to sell the rest of Telstra.

Well what we are saying that they should be concentrating on is the provision of better services, better access, cheaper access, giving people in the West the opportunities that they need. Give people in the regions the opportunities that they need. And that's really the key test in terms of where Telstra needs to be positioned in the future.

JOURNALIST: Mr Crean, do you actually propose to hive off some of people's welfare benefits for the first time share ownership scheme because surely people would rather cash than assets if they are low income earners on welfare dependency?

CREAN: It's an interesting question and I think this is where we have got to further test these notions. In the past I think the assumption has been that people prefer the cash because they have immediate needs and I think it's important that we do something substantial to lift the living wage. That's why I have announced a preparedness to look at the concept of tax credits as a means for lifting the living wage. Using the taxation system to actually underpin minimum wage standards.

That's got significant benefits because it's less cost to the employer, it widens the gap between welfare and work and it means people can get decent liveable wages. Having secured the floor I think that we have then got to be creative in giving people choices between whether they hold or take benefit, or take distribution in the form of income or assets. It's a choice out there for some, we are saying it should be a choice for all. And that's what is inherently involved in the proposals that we are putting forward.

Just as provision of superannuation is a choice between present income and future income we want to give people choice about present wealth being just through money incomes or asset accumulation. The economy has become sophisticated essentially because of the opening up that was done under Labor administration. The preparedness to be bold, to engage Asia, to chase export markets, to recognise that it was important to pursue through the World Trade Organisation. Opportunities for us to value add our resource base, create job opportunities in the bigger sense.

We've become a sophisticated economy there are many financial products on the market. Many workers are aware of them essentially through their superannuation funds and financial service advice that comes with it. What they want, I think, is greater choice in the way in which distribution of the nation's wealth is available to them. And we have got to be creative in opening up those choices, considering those choices.

JOURNALIST: Mr Crean, this is essentially a program of incentives and subsidies. It's going to be expensive isn't it?

CREAN: Talk to me about expensive and this Government economic management? A Treasurer that has gambled $5 billion and lost on currency swaps. A Treasurer that told us that the increase in defence spending in the war on terrorism and the Pacific Solution would all be met out of existing defence budgets is now preparing the ground whereby he has got to find more money. More money from the already scarce surplus.

This is a Government that has not managed the economy well because one would have thought that after 10 years of continuous economic growth, half of it presided over by Labor Governments, and all of it the framework for which was created by Labor Governments, one would have thought that we could have done better than the measly surpluses that this Government is preparing people for in the coming Budget round.

In view of all of that there has been enormous waste. The Pacific Solution has been an enormous cost, we don't know the precise amount, but one could have developed a strategy far more cost effective. We know the waste that has gone into the excessive advertising campaign of this Government what we are talking about is reordering priorities. But significantly if what we can build in to economic activity through enterprise bargaining is creativity in the bargaining process to lift productivity what we can get is a stronger more sustained economy in which people have got greater security through a combination of income and asset accretion.

It is about reordering those things. Whether or not it involves additional money only time will tell. Whether there is sufficient money available we will only know two or three years down the track when we know what the state of the fiscal position is. But we won't be running the Budget into deficit. We didn't on the last occasion, or the time before that when we went to the election. All of our proposals last time were costed by Access Economics and the Government was not able to punch one hole in them.

So I'm convinced about our fiscal ability to manage sensibly the programs. But we're at a time now less than six months into this Government's third term where we have just got to start thinking creatively about new agendas. I know the Howard Government hasn't got a third term agenda, it tries every diversion to hide that fact. Labor has got an agenda for its next term and this is but one part of it.

JOURNALIST: Mr Crean, if you are going to … share buying, for example, and share ownership, how do you make sure that using taxpayers money for.. that doesn't just result in somebody going out and buying a dud bunch of shares or a bad portfolio? How do you direct them into buying good productive shares?

CREAN: Well, I think that no one can guarantee which shares are going to be duds and which are going to be successful, that's part of the risk. And share ownership is but one of the issues that we have touched on here. I'd prefer us to be looking at the issue that the question of the expansion of shares through employee share ownership schemes whereby the individual gets ownership in and therefore greater interest in the way in which the business is running. This is what enterprise bargaining was about that Labor introduced. I see it as a natural extension of that. And if in fact there is a framework already in place by which shares are issued to senior executives why shouldn't we be able to extend that? Why shouldn't we think creatively of extending it to the rest of the workforce?

I think the question of where the Government contribution comes in goes more to the areas of home ownership, superannuation, maternity leave, giving women the real flexibility and choice to raise families as well as to enter the workforce. We are the only Party prepared to advance a commitment, make a commitment to advance paid maternity leave. And we'll fund that too, appropriately, cleverly, creatively in a way that doesn't put the Budget into deficit.

Budgets are about choices, this Government has made the wrong choices and this Government has run out of options. Labor will be making better choices and it's full of creative options. We will continue to put them forward, we will continue to take advice on them, we will continue to develop the proposals. We have got a positive agenda this Government has got none.

JOURNALIST: Mr Crean, shouldn't you be encouraging Australians to pay off their debt, pay off their mortgage rather than gamble on the stock exchange?

CREAN: Well, the people who have been put into debt it has happened under this Government's watch. Household debt is now the highest on record and this is why when the Government gets up there and crows and when Peter Costello, in particular, smirks about how good the economy is and the Prime Minister says it's going gangbusters, why do you think so many ordinary Australian families say well why am I still under financial pressure? Because they have been put in the circumstances in which to survive they have had to go more into hock. That's why any increase in interest rates is going to have much greater impact on these families in the future. This isn't just the house mortgage payments that go up it's the debt repayments because of the massive expansion of household consumer debt that's occurred under this Government's watch.

My proposal essentially seeks to give people choices but what we have got to do is to start lifting that burden on ordinary Australian families. We've got to be giving people better choices as to how they can move in and out of the workplace. We have got to give them better access to training initiatives and in the process of distribution and the arguments about distribution we should be giving people more effective choices.

JOURNALIST: Mr Crean, can I ask on another aspect of economic ownership. How does that fit in with joint ventures such as Oasis and things like that, infrastructure in local communities?

CREAN: Well, I think that the question of the development of infrastructure in local communities is an important issue involving public/private partnerships and will increasingly become so. A lot of infrastructure initiatives that have occurred and that are servicing well this region came from infrastructure bonds that were introduced under a Labor Government. A means by which you look at the taxation system and change the timing at which the deductions could be made. To lower the cost of the investment infrastructure make it more economically viable.

Who put the freeze on the infrastructure bonds? The Howard Government. And what that has done is to restrict initiatives that local governments and communities can make. I actually think that with the right taxation instruments there is huge opportunity for superannuation funds to invest in community infrastructure. And these are some of the initiatives that we will also be considering.

JOURNALIST: Would you agree that there is some risk in asking for people to put their money into the share market? And I am thinking that if this had been put up two years ago what would have happened if people had seen the ..coms. ... and thought we might make a buck there?

CREAN: That is a good point there is always risk but what about the people who worked in those .coms? They are fundamentally at risk because they haven't got a job. Life is about risks.

JOURNALIST: (inaudible)

CREAN: I'm trying to answer your question. If what we said that we weren't going to embrace any of these concepts because there was a risk we would do nothing. My only point is this: that we've got to really run a strategy in tandem. We have got to run a strategy that strengthens and sustains the ability of the economy to grow stronger. And I think that if you look back to the 80s on the economic reforms that we made we saw the first big step up in productivity this country ever historically achieved. It happened under Labor economic management.

We still haven't experienced the next big step up in productivity that drove the US economy so successfully for the past seven or eight years. The implementation, application, utilisation of the technology. Forget the boom bust in terms of the .com companies, I'm talking about the technology platforms and the usage of them. Better logistics, better education, better dissemination of information, smarter working. Australia has not tapped this issue. This is why the Knowledge Nation agenda is so important. Why connecting regions is so important. Why lifelong learning is so important. Why making our education and training institutions work more full-time and for a broader community than just the cohort that is enrolled. These are creative solutions to strengthen and sustain a higher level of economic growth in our economy.

If we get that right and at the same time developing these proposals we should be giving people choice about how they take their distribution, their share, that's what this paper is about. And it's really saying if what we need to do is to encourage people over the hill to get them start looking at these things, which they tended to look away from because they never understood them, and which they see everyone else into and they say well why not me too if it's working for them. Of course there are risks with it. We have to prepare the ground for it but this is about giving people choice. And in the same way as we spread superannuation to the vast bulk of the population we've got to look creatively at the other asset classes and we will do it.

JOURNALIST: Mr Crean, what about the aged? We've talked about the younger middle aged here ..finding it harder and harder.. especially ..medication .?

CREAN: Well, I think that this highlights the dimension of the problem for economies that they go through transition and continue to modernise. It's true that the sorts of the things that we're talking about here are going to benefit more those who are in the workforce or coming up into the workforce. But in the case of superannuation, for example, if it were not for the initiatives that we put in place 15, 18 years ago there would be enormous pressure now on the aged pension system in a way that would see governments being under enormous pressure to cut the entitlements because they had to appeal to a younger population who took the view 'I've got to provide for my own entitlements why should I have to look after someone else'?

So I think it's very important that we understand where that demographic is heading but at the same time we have to care properly, sympathetically for people who have made the contribution to this nation. And that means proper aged care facilities and quality aged care facilities and continuing access to pharmaceutical entitlements. Not restricting them, not putting them outside the reach of people.

And it also means continuing to fund adequately the level of aged pension where that is the sole source of income. To the extent to which people can be encouraged to earn additional income I think we have got to be creative about encouraging that too. I don't believe that people stop simply because they turn a 55 or a 65. They still have valuable contributions to make and I would like to see us encouraging people to exercise those choices and to recognise those who give up their time freely and volunteer.

These are people that do need the sort of consideration and they are the types of policy areas on another day we will be having something more to say about. But just because this initiative is touching on the people that we have talked about today. That's not at the exclusion of the senior citizens of our community who have given so much. They deserve to be looked after and under us they will be.

JOURNALIST: I have a question. I work with the young people of the area. In your platform or in your program you are addressing an area where IT future and there are some people who come out of school who are not familiar with ..IT huge gap.. the ones that want to work.. So what do you do to address that..?

CREAN: Well we do have to close that gap. It's true that the great new dimension of education is IT literacy, it's not just the three R's any more. You've got to know how to operate not just a computer, but how to access the information and the database that goes with it. I would've thought that if you look at young people these days they are very proficient and very competent because it is being taught in the schools. The big worry is for the people who are in transition between jobs and what we've got to do is to retrain people and provide the facilities by which that can happen and open up the schools after hours, open up the TAFE colleges, have community programs that encourage and teach, take it up as part of restructuring initiatives in work places. Insist upon the retraining. It's the life long learning, not just the entry level learning that we've got to come to grips with and one of the most important things that can be done in that life long learning program is to give greater access to enable people to become IT literate because that does improve their employability.

JOURNALIST: Mr Crean, you're sharing a stage with Mr Latham. How do you respond to calls for a fulsome apology to Tony Staley?

CREAN: All right, let me just deal with this question. Have you read the transcript of the interview on Friday night on the Lateline program? I ask you that question because I think it's an important starting point. Have you read it?

JOURNALIST: I'm asking you the question Sir.

CREAN: Well I know you're asking me the question but there is a premise associated with it that I think entitles me to pose it. I assume, from the fact that you haven't fulsomely said yes, that you haven't read it. I suggest you do. Because what you'll see in that is that the reference that Mark Latham made had nothing to do with the physical appearance of Mr Staley, only to his behavior. The second point is that on Saturday, when this furore first erupted, Mark Latham said if anyone has taken the inference that it was to the physical characteristics, I apologise. So if it's about the physical characteristics, he's already apologised.

But what have we got? We've got a Prime Minister without a third term agenda who spends his weekends putting out two press releases calling for an unqualified apology. Give us a break. This is the bloke that still hasn't apologised to Mr Justice Kirby for Bill Heffernan's outrageous outbreak. This is the bloke that hasn't apologised to the parents, or the mothers on the vessel that was sinking, the SIEV 4, when the Government said they were throwing their kids overboard. This is a person who wants you to look at something, and I've learnt from the Tampa experience, that whenever he asks you to look at something specific it's because he doesn't want you to look at something else.

Now, we have here today an important set of announcements. This comes off the back of us having announced policy after policy direction over the course of the last few weeks. Our new engagement with Asia, our partnership with China, our support for maternity leave, our lifting of the living wage. These are all positive initiatives that we're driving an agenda for and what does the Prime Minister want to talk about? Not his Budget, not the cuts to pharmaceuticals, not the further sale of Telstra. He wants to talk about us.

Well good luck to him, but I tell you this that when he learns how to make an apology then he's entitled to ask for one but to the extent to which Mr Staley feels as though he's been attacked, Mark Latham has already apologised to him. The story should end there. But what won't end there is our pursuit of these policy initiatives. This is a Government that hasn't got a third term agenda and as always Labor will lead the way. I'm serious about modernising the Party and today's announcements are part of that direction.

JOURNALIST: I also asked that you put Mr Latham on the backbench? I dare say from your comments.

CREAN: Well, listen, you know why they want to put him on the backbench? Because he keeps coming up with good policies. You know just think about it. Why would you want to put him on the backbench, when he's making a constructive proposal? The only person that would put an ideas person on the backbench is John Howard. Because he's got none and he doesn't want to be threatened by any.

So I won't be taking Mr Howard's advice. In fact, there were some on our side who were sharing that advice I think at the time we were putting the Shadow Ministry together. Mark and I didn't take their advice either. I think that he deserves to be on the frontbench because he's going to make a contribution. I said I was going to modernise the Labor Party and a key part of modernising the Labor Party is bringing fresh faces and new ideas to it.

Today's announcement is a demonstration of faith in my part that I've done the right thing on keeping him there and I'm going to keep him there because I want him to keep coming up with the good ideas.

Ends.