Sky News

SUBJECTS: Federal Politics; Malaysia Solution; High Speed Rail; Carbon Tax; SA Labor Leadership Coup

David Speers:  Welcome to the program.  Well Julia Gillard said this would be her year of decision and delivery.  And in recent weeks she’s certainly been busy agreeing to the carbon tax with the crossbench, agreeing to the health reform deal with the states and territories, and also signing off the Malaysian solution on asylum seekers.  But the government is still struggling badly in the polls, so will this recent burst of activity turn things around at all?   We’re joined this week by Labor MP, Ed Husic, former Labor Minister and Sky News presenter, Graham Richardson, NSW Liberal Premier, Barry O'Farrell, and Liberal frontbencher, Christopher Pyne.  Welcome to you all.  I want to start with the Malaysian deal which was signed off last week but only now is being put to the test.  We’ve seen tonight, in fact we’ve got some pictures of the first boat load of asylum seekers to be intercepted since this came into force being transferred to Christmas Island.  They will soon be flown out to Malaysia.  As you can see from the images, some of those on the boat are women, but quite a few of them are children.  We’re told in fact by the Minister, Chris Bowen, that 19 of those on board are kids, or in his words ‘claiming to be kids’.  You can see on the shots there, one of them is a young boy.  But 19 in total are claiming to be minors.  The government has said no blanket exemptions here, kids will be sent to Malaysia as part of this deal.  Richo, first to you, how comfortable are you with that, and with the prospect even of these kids having to be frogmarched onto the plane?

Graham Richardson:  I’m not comfortable at all with the idea of unaccompanied children being sent to Malaysia where a fate awaits them that you just wouldn’t know what.

Speers:  Well Malaysia has a pretty poor record, doesn’t it?

Richardson:  It’s got a very poor record and I don’t think it’s going to get better any time soon, so that part of it I don’t like at all.  I know why the government is doing it.  They believe this will have the big effect, that the boats will just drop off straight way, and if they’re right then they’ll gain from it politically, because I don’t think my view on unaccompanied children is shared by the majority of Australians.  If you look at the polls even in the last week, the biggest single issue is immigration and border security, not the economy, not carbon tax.

Speers:  What about when it comes to kids though, you don’t think there’s a bit more sympathy out there?

Richardson:  Look, there’s not much.  I detect in the community very little sympathy for it, and I don’t like that aspect of it, because I do think sending kids to Malaysia is pretty rough.

Speers:  Barry O'Farrell, what do you think about this?

Barry O’Farrell:  Well I’m actually with Richo on this, but I accept that there’s a bigger issue here, and the big issue is why did the federal government change the policy they inherited that was actually working?  So the problem is that if you start to separate kids out from the rest of it, and that’s what I would do, Richo, you then open up an avenue where people smugglers can find a way through the law.  What we had before, before the change of government in 2007, was an effective policy that appeared to have stopped the boats, that appeared to have stopped the problem.  It was tinkered with and, like most things that were tinkered with, it no longer works.

Speers:  But if it was up to you, you wouldn’t send kids off to Malaysia?

O’Farrell:  Well the good news, I’m a safe politician, I’ll leave this to the wisdom of these guys, but you know I regard people as assets.  I have a particular interest in children.  I don’t think we should be penalising children for the sins of their parents and others.  It’s a tough decision.  I think we chose right.  There’s not a lot of sympathy out there for any refugee, but the fact is that these are kids.  But I go back to Tors(?), which is we shouldn’t have changed the policy in the first place.

Speers:  But Chris Pyne, the Howard government policy also saw kids diverted to Nauru and Manus Island.

Christopher Pyne:  Nauru was a much, much better option than Malaysia.  I mean, David, we wouldn’t be sending anybody to Malaysia, let alone children.  The Howard government was a tough policy.  Look, it worked.  It was a combination of temporary protection visas, the Nauru processing centre in Manus Island, turning back boats when that was acceptable. This Malaysian solution policy is the greatest hash job I’ve ever seen a government undertake.  I mean for goodness sake, Julia Gillard said years ago that Nauru was an absolute disgrace because they hadn’t signed the UN Convention, it was wrong in principle, it was wrong politically, it was wrong for the people who were sent there.  Malaysia hasn’t signed the Convention on Refugees, but apparently it’s perfectly acceptable to send unaccompanied minors to Malaysia. 

Speers:  But to be clear, you’d send unaccompanied kids to Nauru?

Pyne:  We would. We would certainly not send unaccompanied minors to Malaysia.  We wouldn’t send anyone to Malaysia.  The United Nations Commissioner for Refugees says that Malaysia is the second worst country in Asia for managing refugees.

Speers:  Ed, how do you defend this?

Ed Husic:  Well I’ll come back to your point that you started with, which was are you comfortable with the situation?  I’ll tell you what I wasn’t comfortable with, and that was standing on those rocks at Christmas Island and seeing that very place where the refugees back in December 15 lost lives in those terrible conditions.  And this is what it’s about, it’s deterring people from making what is simply an inexcusable trip when you think of the two days that they’re on the sea, in vessels that you know those people that are commanding the vessels know are not seaworthy and putting those lives at risk. 

Speers:  But you saw the shots, Ed.  There’s a young boy there that you can clearly see and we’re told there are others on that boat.  Are you happy sending him to Malaysia?

Husic:  I would much prefer that he wouldn’t make the trip in the first place, that we be able to have a situation where people aren’t putting themselves in that risk.

Speers:  But what fault of it is his?  He looked pretty scared.

Husic:  Well absolutely, you can understand as someone you can empathise with, you know, what would be going through their mind.  But at the same time too, how do we explain to the parents who see their own children lose their lives in those conditions that that is a situation we would tolerate?  It’s simply not.  We need to be able to find a way to stop people making that journey, to break that model.  And you know in terms of Nauru, frankly where did they go from Nauru once they got there?

Pyne:  43% came to Australia, and 57% didn’t come to Australia.  Those were the facts of it.  And I’m not blaming you, Ed, for this terrible policy; obviously you’re a new Member of Parliament.   The truth is the government arrived in power in 2007.  There was a solution to a problem, and they’ve created a problem.  And now they’ve made it much, much worse.  I couldn’t agree with you more that these people shouldn’t be trying to come to Australia and taking that risky trip.  And under the Howard government in 2007 there were four people in detention – there are now 6,500 people in detention.  The Malaysian solution, Julia Gillard should simply swallow her pride and say look, Nauru worked, they want to reopen it again.  The good thing about Nauru, and I’m a moderate Liberal, I’m not completely mad about the Howard government’s policies, but they worked, and they’re better, they were better than people making that risky journey.  But in Nauru we knew they were going to school, we knew what their health outcomes were, we knew where they were.  We knew they weren’t being beaten, they weren’t being extorted.  In Malaysia, goodness knows what’s going to happen, and if you’re an unaccompanied child in Malaysia it’s just criminal.

[overtalk]

Speers:  Richo, do you reckon that Nauru is any better . . .

Richardson:  . . . [inaudible] that you’re a moderate Liberal – that makes two. We heard Malcolm Turnbull this week.  You’ve now got a mate!  I’m very happy for you. 

[laughter]

Speers:  We might get to him later on.

Richardson:  I’m sorry, David. 

Speers:  But do you think Nauru is any better than Malaysia?

Richardson:  Look I think Nauru is better at least in terms of the way you get treated.  I think it’s a ridiculous solution and always did think so.  I think out there in the middle of absolutely nothing, and remember all the locals have got one ambition in life – to come here!  They don’t want to go there either.  They want to get off, they’re on as soon as they can.  So I never liked that solution, and I’ve said before, I know it’s unpopular in Australia, but I would have onshore processing.  I just don’t believe in all this.  I think you’ve got to find a way to process claims quickly, and the people who are knocked back have got to be sent back fast.  I think what’s missing in this debate is a solution that manages to deal with these applications quickly.  They take forever, and that’s the problem.  And why are you having all the trouble in the detention centres?  Because you can’t get a result, people are getting frustrated, annoyed, and obviously it’s going to bubble over at some point and that’s very sad.

Speers:  Barry O'Farrell, I can see you nodding there.  Is the temperature of this debate too hot?  I mean is there a way to get a bipartisan approach to this that looks after the kids but also stops the boats coming?

O’Farrell:  Clearly not, because you wouldn’t be going through this farce of Malaysia.  If there was bipartisanship they would, as Christopher said, sign up to the offshore processing that did work last time.  My nodding was that there is enormous frustration at the detention centres.  One of those detention centres happens to be in this city.  We’ve had the same problems in that detention centre as has occurred elsewhere, not as bad as on Christmas Island.  But, you know, we can’t even get an agreement between the state government and the federal government that allows police access into that detention centre during such periods.  So we can’t even get bipartisanship or at least agreement on what is a commonsense solution, which is you know when there are problems in those detention centres, police, state police ought to be allowed in, because we don’t have the federal police to do the job.  We had issues when there was a fire out at Villawood even in relation to the fireys.  So we can’t even offer protection to those who are in detention centres, because we can’t get agreement between federal and state government. 

Speers:  When it comes to the police, the next test for this Malaysian deal will be how much force is used to get these people on the plane to Malaysia if they refuse to get on.  The government is not wanting to say what the police should do; they’re leaving it up to the police.  But they’ve made it clear they’re going to broadcast far and wide, film the event, put it on YouTube and send a message out to the people smugglers.  Is that going to work, Ed?

Husic:  I think we’re sending the message loud and clear that if the AFP needs to make decisions to best manage the situation, then those, the AFP will have the ability to do so.  But at the same time-

Speers:  Is there a bit of hypocrisy here in that the media is always told you can’t go anywhere near these people.  You’re not allowed to shoot, film, record anything when it comes to asylum seekers.  The government go in and film what’s going to be a pretty-

Husic:  So you haven’t been able to film anything so far?  I mean there is stacks of film, stacks of footage-

Speers:  We can’t get into any detention centres.

Husic:  There’s stacks of footage.

Speers:  No, we can’t.  You can’t go into a detention centre and talk to asylum seekers.  You know there’s huge restrictions when it comes to media covering any of this stuff.  Government is allowed to go and film these guys being forced onto a plane and then put it on YouTube?

Husic:  We’re just going to have disagree on that, because there’s enough footage there.  And it also depends too, in those situations as well, given the sensitivities involved, having media traipse through what is already a pretty touchy issue, you’re not necessarily going to have that situation exist. 

Speers:  Do those privacy concerns go out the window when it comes to the government filming?

Husic:  Well-

Richardson:  But it’s not only privacy concerns, David.  I mean it just seems to me what is extraordinary is that it’s a Labor government that’s getting really tough with refugees and sending them to a place like Malaysia.  That is extraordinary. 

Speers: And filming it, broadcasting it.

Richardson:  If you’ve grown up in the Labor Party as I have and looked at it, I’ve been in it for 40 something years, I just find it incredible to think that it’s happened – and it’s happened without any drama.  There’s no riot in the streets. 

Husic:  Well it depends on your perspective though, Richo.  I mean the two other things I put, as I said before, I made the point earlier about the extreme risk people put themselves and their families in to make the trip.  But the other thing is too in terms of the arrangements we’ve made with Malaysia is we potentially give a new start to 4,000 people and increase the number of people accepted as refugees.  So I mean the-

Pyne:  What happens when the 800 fills up?

Husic:  As I come back to the point, the 4,000 that get that opportunity to get here is overlooked; it’s important to have . . .

Speers:  . . . And the UNHCR has welcomed that, there’s no doubt about it, Ed.  They say that is . . .

[overtalk]

Husic:  Exactly, and the other big difference too, and I might add between in terms of Malaysia and Nauru, is clearly the involvement of the UNHCR.  So they have been involved in this every step of the way.

Pyne:  Hang on, hang on.  Chris Bowen was saying a few months ago when Doug Cameron and Janelle Saffin and Melissa Parke in Western Australia were saying that the UN must sign off on this.  Chris Bowen said the UN would sign off on it without any doubt.  Well the UN came out only yesterday, Peter Towle said, and the UN definitely has not signed off on this agreement.  He distanced himself . . .

Husic:  . . . It’s a bilateral agreement between two countries. 

Pyne:  He distanced himself . . . 

Speers:  . . . But it is does not endorse this . . .

Pyne:  . . . as quickly as he could, and the idea that the UNHCR has somehow agreed to this dance with the devil is completely-

Husic:  But Christopher, why were they there at the signing?

Pyne:  It’s completely misleading. 

Speers:  They haven’t endorsed it, that’s plain.

Pyne:  What happen to the 800?  Once the 800 fills up, once the cup fills up, what happens after that?

Husic:  Well we’ve got the agreement in place in terms of the 4,000 coming here.

Pyne:  Once the 800 that we are sending to Malaysia runs out, what happens then?

Husic:  Then take it back a step.  Again, the issue is to break the motivation to take this . . .

Pyne:  . . . But what happens once the 800 fills up?  . . .

Husic:  . . . to break the motivation for people to make the trip.

Pyne:  So you think there’s only going to be 800 more refugees trying to come to Australia? 

Husic:  Well we’ve already seen relative to where we are this time last year-

[overtalk]

Speers:  Chris Pyne, the use of force-

Husic:  But hang on a second.  Relative to last year the numbers are down.

Pyne:  So things are going well? 

O’Farrell:  David, can I come back to one of Richo’s points which is there’s no-one marching in the streets about Labor Party policy.  But they are.  Look at the opinion polls, you’re bleeding votes to the Greens.

Richardson:  No, within the party.  I’m talking about within the parliamentary party . . .

[overtalk]

Richardson:  There’s virtually no opposition.  You know, you came up with three names, even you, and you’re trying to stir this up!  It is very hard to stir up in the caucus, there’s just no issue.  I just find that amazing . . .

O’Farrell:  Well there’s Kelvin Thompson as well and Steve Georganas . . .

Richardson:  . . . The caucus that I was a member of a very long time ago certainly would have a very different view.  It just shows that, you know, the younger brigade have different views, don’t they?

Pyne:  But if you were there, they would never have got themselves into this terrible position where they took a policy which was working and ended up with a policy where 6,500 people are now in detention and they’ve had to come up with this crazy, awful scheme to make it look like they’ve got a solution.  

[overtalk]

Richardson:  I do not believe it’s a triumph of political management, I’ll say that. 

Speers:  Let’s move on – the health reform deal was also finalised this week, 16 months after Kevin Rudd announced an historic agreement had been struck.  It’s taken a while.  Barry O'Farrell, it began under a previous Prime Minister, it began under a previous Premier too in NSW, and now it’s been finalised under you, Julia Gillard and the other state and territory leaders.  Is it going to make a big difference for patients?

O’Farrell:  We think it will. For NSW it means additional billions of dollars over the next six years, $3 billion over the next six years.  It means that growth funding comes in almost immediately as opposed to having to wait eight years for it.  What’s that about?  That’s about providing better services to communities, whether city or country, across NSW.  Can I just say this about the Prime Minister?  This is the first engagement I’ve had with her on any issue.  I’ve been impressed by the way in which she’s handled it.  She’s been tough.   She’s compromised, which is the art of politics, there’s no harm in that.  But she’s been clearly focused on getting an outcome that delivers real results.  So I won’t necessarily agree with my federal colleagues on this, but I can’t fault the Prime Minister in her commitment to getting this agreement done. And I have to say in the time that I’ve been there she’s putting more backbone into COAG than I’ve seen over the past ten years.

Speers:  Chris Pyne? 

Pyne:  Well I’d expect Barry to say that because he’s the big winner, and it’s nice of him to try and throw a bouquet to Julia to make her feel better and make it look like she’s, you know, really held the premiers down while she’s handed over billions of dollars more taxpayers’ money to the states.  And the states have done very well out of it – congratulations to Premier O’Farrell and all the Labor Premiers.

Speers:  But this is more than just money, isn’t it?  This-

Pyne:  It’s been a great win for the states. 

Speers:  This is about reforming the system.  I don’t know if it’s the biggest chance since Medicare was introduced, as Julia Gillard says . . .

Pyne:  . . . Hang on, they started off saying that there . . .

Speers:  . . . But there is reform here . . .

Pyne:  . . . there was to be a four hour turnaround.  There was 100% of people had to be guaranteed that they would be seen within four hours.  That’s not part of this policy.

Speers:  Well it’s now 90% and it’s a target. 

Pyne:  It’s now 90% and it’s a target.  There was to be 100% guarantee or patients were to be sent-

Husic:  Why did that happen?  The CMO and the expert panel . . .

Pyne:  . . . All patients were to be sent to private hospitals . . .

Husic:  . . . said that this was the most appropriate target.

[overtalk]

Husic:  Exactly.

Pyne:  And private hospitals are not going to have to take these patients.

Husic:  Who do we listen to, politicians or clinicians?

Pyne:  Secondly, the states were to hand over the GST, 30% of their GST was to be handed over to the commonwealth.  The states aren’t handing over one dollar in GST.  This was a great outcome for the state governments.  It is a transfer of cash from the federal taxpayer to the state taxpayer.  My hat goes off to the state premiers for holding up, Barry and Ted and Colin obviously who’ve had a big part in that.  But the idea this is somehow reform, this is a year of duds and distractions, not a year of delivery . . .

Speers:  . . . Okay, well Richo, you were the Health Minister, tell us why this is reform?

Richardson:  I listened to Chris and most of what he just said was drivel.  But I understand why he’s saying it, because Kevin Rudd made it possible, because what Kevin Rudd did was set up something that no federal government could ever achieve, which is of course now what . . .

Speers:    . . . What he overreached? . . .

Richardson:  . . . which is what Chris wants to use as a benchmark.  Overreached!  He walks out and says I’ve just done this historic agreement.

Pyne:  Another one.

Richardson:  And an absolute nonsense.  There was no agreement about anything.  And they chances of the states giving up a third of the GST was always nought, absolutely nought.  I said so at the time when he walked out and said it.  I thought that’s impossible, and of course that’s how it turned out.  16 months later though I think you’ve got a deal that does give some really good reforms.  As a Health Minister, one of the things you’re always fighting with the states about, day in, day out, is growth.  Growth funding is always the biggest argument, because we all know the funding is going to have to grow, and there’s just sort of an interminable argument about it.  Now you’ve got 20 years worth of growth built into the system.  Now that is a great reform in the old system, whether you like it or not.  What they’re doing in elective surgery and things, I think these targets are all good, and I hope they work.  Now if you can’t . . .

Speers:  . . . The thing is they may not be as ambitious as Rudd’s, but they’re better than what we’ve got at the moment.

Richardson:  They’re not as ambitious as Rudd’s, but Rudd’s were impossible.  These things, I think, are achievable if there’s real intent on both sides, and I’m assuming there is.  It’s going to be a hard and long battle, but it seems to me this is the right track to be on.  Now there will be changes to this, agreements over 20 years never stick exactly.  But they’re on the right path and it’s something that I wish had been done a long time ago.  But you can’t set up Kevin Rudd’s position as a benchmark, Chris. 

[overtalk]

Husic:  And a key message out of this is about sustainability. 

Pyne:  So that is the benchmark. 

Husic:  Sustainability is the key issue, by 2046 state budgets overwhelmed purely by health costs, and being able to provide that certainty of funding in terms of growth and what that will do I think is the biggest win out of this.  And as was reflected on this week, you know, we don’t have to go through the theatre and the drama of people walking out of funding negotiations. Just get on with the job now of meeting the healthcare needs of patients.  I think the other thing . . .

Pyne:  . . . They did run out of the funding negotiations . . .

Husic:  . . . that’s important in this too is, just picking up on something the Premier said, I think it is important to be able, regardless of political lines, to just get to the point where a deal is done, we can move on and give people certainty in something that they want on healthcare. 

Pyne:  But the governments did walk out of the funding negotiations.  They’ve been 18 months holding out, let’s face it, Colin Barnett . . .

[overtalk]

Husic:  Stop looking in the rear-view mirror. 

[overtalk]

Speers:  Let me just finish on this topic, with a question to the Premier? . . .

Pyne:  . . . No wonder you don’t want to look in the rear vision mirror, the truth is you can’t hide your history.

Speers:  Barry O'Farrell, what’s your message to the federal Liberals about health now? 

O’Farrell:  Well the message-

[overtalk]

O’Farrell:  If I can get a word in, as I said in the state parliament yesterday, the fact is an agreement has been done between the states and the commonwealth.  If there is a change of government at the next commonwealth election those agreements are respected.  But I do take Graham Richardson’s point, that over the span of 20 years they’re always tweaked.  But you know, I say again, with all due respect to Christopher, with all respect to my federal colleagues, that from a state perspective this is a good deal.  I happen to think it’s a good deal from a national perspective, because these are realistic, realisable reforms that will make a difference to people’s lives, whether they live in the city or whether they live in the country.

Speers:  On an issue where you haven’t had as much to agree with on the Prime Minister is the carbon tax.  After the break we’re going to look at how that debate is going.  Stay with us.

Speers:  Welcome back.  We’re joined this week by Labor MP, Ed Husic, former Labor Minister and Sky News anchor, Graham Richardson, Barry O'Farrell, the NSW Liberal Premier, and Liberal frontbencher, Christopher Pyne.  Now I want to turn to the carbon tax.  There’s been some respite for Julia Gillard this week with Tony Abbott on holidays, but the hits do keep coming.  In fact, Barry O'Farrell, your government has released some figures showing NSW will be worse off than the federal government has suggested.  How confident are you in those figures, because the commonwealth disputes them?

O’Farrell:  Well the commonwealth disputes them on the basis that they do national averages.  Well guess what?  If you’re predicting a national average increase of electricity of 5% or 10% and the reality in NSW is going to be 15%, up to $500 a year, that’s not much comfort if you live in Greystanes or Rooty Hill or out at Gulargambone.  So we’re dealing in real life situations here.  We know that in Sydney our salaries are higher than average in the nation.  That means the $150,000 average compensation limit is going to have less impact in this city than elsewhere.

Speers:  The suggestion has been that you haven’t factored in the $9 billion in compensation for industry as part of this package.

O’Farrell:  Lots of suggestions today, including that we hadn’t factored in green jobs.  The fact is that this NSW Treasury review, undertaken by Frontier Economics, says that we’ll lose 31,000 jobs.

Speers:  But did they factor in the compensation?

Speers:  They factored in both new jobs and loss of jobs, so we got net loss of 31,000 jobs.  They factored in increases of electricity for up to $500 for a family, up to $4,000 for businesses, which factored in compensation.  And it indicates that it’s a disaster for the state, so I don’t understand the politics of this, I don’t understand why you’d hurt a struggling national, but in particular the NSW economy, with this sort of hit to the economy.  And I don’t understand why you’re going to put more costs on families and small businesses at a time when they can least afford it.

Speers:  Richo, who do we believe?  NSW Treasury says one thing, federal Treasury says another.

Richardson:  Barry was pretty cagey then about compensation for industry and I expected him to be cagey because I think that is a bit dodgy.  Obviously when you’re doing modelling it just depends on what you want to feed in in the first place, and I think Barry’s figures won’t last.  Mind you, I’d suggest that probably Treasury figures will be a little bit the other way, so you’ll meet somewhere in the middle later on.  I believe that there will be some changes to all of this a well before it’s all over.  So I don’t get too carried away.

Speers:  To the carbon tax?

Richardson:  But I think Barry’s stuff today is a little bit over-the-top.  That having been said, I think there is a problem about two-speed economies.  There is a big difference between what’s happening in Perth and what’s happening in Sydney, and I don’t think that we’ve found a way to take it into account in any measure, not just on carbon tax, with anything else either.  So that is a problem for the future that we are going to have to look at eventually.

Speers:  But on this carbon tax issue in particular, Ed Husic, your seat is in NSW, how worried are you about the impact here in a state and in a city of Sydney that, as the Premier points out, you do have higher incomes, you may feel a tougher impact?

Husic:  Sure.  And look, when we first announced the details itself, like obviously that period of time was difficult because we’ve got on the one hand a lot of fear being whipped up about what the impact will be, and we needed to be able to counter that with information and get people to get their hair around it.  I’m not saying that it’s mission accomplished, we’ve still got a way to go, but people are starting to appreciate that there will be a balancing out effect.  And I think in terms of the report that was done today, or the review, it’s Treasury’s review of another report being done by Frontier Economics.  Frontier Economics, who also helped out you guys I think at the federal level as well . . .

O’Farrell:  . . . And helped out federal Labor governments [inaudible] . . .

Husic:  . . . and were responsible for . . .

Pyne:  . . . Burn them at the stake then if they’ve worked for the Liberal Party, don’t you think?

Husic:  Is that an invitation? 

Pyne:  Your call.

Husic:  But certainly I think you know we’re just going to dispute on a number of areas the figures.  I think at one point the NSW government indicated, Premier, that it would have a 20% impact or increase on electricity prices; you’re now saying 15%.

O’Farrell:  I’m quoting the average middle sized family, up to 20%, yes.

Husic:  Sorry Premier, my understanding, Premier, is it was 20% initially, now your government’s saying 15%.

O’Farrell:  It’s 10% to 20%, I took 15% to be honest. 

Husic:  We believe it’s 10% and we believe that the compensation packages will take industry . . .

O’Farrell:  . . . So if your constituents get an increase above 10%, they should come and get you to foot the bill?  You should put your money where your mouth is!  Give us your electorate office address, and they can come and visit you after the bills come in.

Husic:  I’m out and about in my communities all the time, and I also say frankly, I’ve said frankly here and elsewhere, there are obviously people that have concerns about what this impact will have.  But we’ve got to go through the process of explaining where it’s all at.

Speers:  Do you think, Chris Pyne, the heat’s coming out of this issue at all?

Pyne:  Absolutely not.

Speers:  You can keep this up?

Pyne:  Labor would like to think it was.  I think some people in the press gallery would like to hope it was.  It’s an absolute red hot issue in the electorate, and there’s two reasons for that, number one because the Prime Minister lied about it before the election, and the public know that if she had said before the election rather than there’ll be no carbon tax under any government I lead, oh by the way I’m introducing a carbon tax, everyone knows she wouldn’t have been re-elected.  So that’s number one.  The fact that it’s a lie is a big problem, but the bigger problem is that it’s going to add to costs of living pressures.  The public are absolutely beside themselves at the moment about the cost of living pressures that they are facing.  We’re seeing it in the collapse in retail sales in Australia, business confidence, consumer confidence, the increase in mortgage defaulting that’s going on in Australia, in January and February the spending on groceries actually fell in this country.  There is a huge concern in the electorate about cost of living, and they know that whether it’s 10, 15, 25, whatever percentage it is, there’s going to be an increase in cost of living and this is going to be a pressure they just cannot face.

Speers:  Malcolm Turnbull this week at the National Press Club toed the party line . . .

Richardson:  . . . Your mate . . .

Pyne:  . . . He’s a good man . . .

Speers:  . . . in support of the direct action alternative and said that no, he wouldn’t cross the floor and vote for the Labor Party’s carbon tax.

Pyne:  He was never going to!

Speers:  No, but he did make the point a few times that the coalition needs to win the middle ground.  To win an election you can’t just appeal to your conservative base, you’ve got to win the middle ground.  Do you agree with him on that?  What was he meaning by that?

Pyne:  I think what you’ve got to do in politics to win election is you’ve got to get your base intact, and the two years after the 2007 election when we were polling very poorly, I think it’s fair to say our base was fraying at the edges.  Our base is now very much back supporting Tony Abbott and the team, and are extraordinarily disappointed with the Gillard government.  Then of course beyond your base you have to win enough swinging voters in the middle to make sure you win the election.  It’s really not actually very complicated.  When you’re polling anything between the smallest polls are saying we’re 55, that’s the Newspoll, right up to 59 in the Nielsen poll, you’d have to say that we are winning a lot of the middle ground.  So while we hope that lasts through the election, I don’t think you could say that at the moment we are in danger of losing the middle ground.

Speers:  That’s right, isn’t it?  You’ve got to win the middle ground.  But the polls show Tony Abbott is doing pretty well at that.

Richardson:  The middle ground has already been won, and it’s been won by Tony Abbott and the coalition, there’s no question about that.  Labor’s task is to get it back.  They’ve begun and I think they’ll get some of it back.  I don’t believe it’s possible to get enough back to win an election, so I suspect they’re going to lose the next election.  But they won’t be doing as badly as they are today.  I think when people get money in their pockets next May, it’s a cunning plan to put the money in the pockets prior to the tax even beginning in July, I think things will start to look a bit better.  What I’m disappointed about though, if I can just get one oar in the water here which Ed will no doubt handle, Tony Abbott goes day after day after day, week after week, month after month with the same measure, Julia Gillard lasted about nine days on carbon tax and stopped.  I just want to know why she doesn’t get back out there and hoe into it every day - a question from a Labor voter?

Speers:  Let’s get an answer then.

Pyne:  Just a naive Labor voter, Graham!  [laughter] 

Husic:  At the same time we are too, we’re out on the ground in our areas talking with people as well, and there’s also the information that is going out. The fact of the matter is though I’ve got to say, you know, making predictions about where we are now versus where we will be, you know, you want to be putting money on that.  I think that’s a brave call myself.  Can I just say . . .

[overtalk]

O’Farrell:  . . . I didn’t believe him, but he was right. 

Husic:  I just wanted to make this point.  I actually reckon I’ll get some laughs out of this, but I’m just going to put it out here on the table.  This issue of trust is going to affect you guys as much, and that is because Tony Abbott has got an issue in terms of where he actually stands on this stuff, because he changes his position all the time.  Now we have, both sides of politics, a commitment to reduce emissions – got to get it done.  Your policy is a dud.

Pyne:  Our policy is a good policy.

Husic:  It ain’t gonna cut the grade.  So they’re going to get to 25% of the 5% target through direct action, I mean you’ve gotta plant more trees than there is land available to do it to make this policy . . .

Pyne:  . . . No, that’s just not true.

Husic:  And at the same time too, how are you going to get it done?  You’re either going to chuck money at polluters and you charge them.  Everyone knows that chucking money at polluters doesn’t work.  So the point will be . . .

Pyne:  . . . I’m interested in one point there, which was that this issue of trust is going . . .

Husic:  . . . I’ll finish on this.  It will come back, because the point will be when the policy doesn’t work out, what are you going to do?

Speers:  I want to get back to Richo’s point about the political tactic of Julia Gillard here.  She did do nine days or so flat out campaigning on the carbon tax.  Tony Abbott clearly wants to go 365 days flat out on the carbon tax.  But you’ve got to be able to, as she tried to say, chew gum and walk at the same time.

Pyne:  She couldn't even say that that was . . .

[overtalk]

Speers:  And what she’s done in the last week or so, the Malaysian deal, the health agreement, what do you think?  When we talk about decision and delivery issues she said this year is all about, is she doing it?

Richardson:  I think that she’s begun to do it and that’s a good sign.  But it doesn’t mean that when you’re doing a press conference about the Malaysian solution, you don’t hammer home a message on carbon tax as well.  Doesn’t matter what they’re asking Tony Abbott about, great big new tax, those words get uttered every single interview.

Pyne:  And it’s another broken promise, Graham.

Richardson:  Neville Wran always said to me that when you are sick and tired of hearing the message, the mob might just be getting hold of it. 

Pyne:  The vomit principle.

Richardson:  So I think you’ve just got to keep going, and I don’t think she’s shown the discipline to do that.  Yes, the health deal and the Malaysian deal help.  I mentioned earlier that immigration border security is the biggest single issue at the moment, bigger than carbon tax.

Speers: You reckon?

Richardson:  Well, the polls show that.  It’s not me talking – the polls show that.  So I think the fact that she’s doing it is a good sign.  But what Chris just said sums up the dilemma that Ed’s got and that Labor’s got.  He went on with this stuff about how theirs is a good policy.  You can’t find an economist, you can scour the ground looking under every rock – every economist says it’s a dud and it is a dud.

Pyne:  No, no.

Richardson:  Of course where Chris Pyne is a very good position is it doesn’t matter!  Tony Abbott doesn’t need any policies at the moment, and he’ll be like John Howard when he got up, he just had headline speeches, he didn’t have policies, neither will Tony Abbott . . .

Speers:  . . . Barry O'Farrell, I’m interested in your view on this.  You were of course a successful opposition leader, winning a record landslide.  Now you’re in government, now you’re Premier, what do you think about this messaging argument?  How much should you keep hammering the same message?

O’Farrell:  I think Kristina Keneally would have been out there day in, day out, arguing the case.  Paul Keating certainly would have, and would’ve been able to walk and chew chewing gum at the same time.  You know, you would’ve still had all of his big Australia stuff, but he would’ve hammered the opposition, or at least tried to hammer the opposition into the ground.  So I’m surprised.  I agree with Graham, you know, you don’t start a strategy where you promise to wear out shoe leather and then give it away before one of the high heels has worn off.

Speers:  But she may return to the issue. 

O’Farrell:  She will.  But you need momentum. Politics is about momentum, politics is, as Graham says, about that slow drip with the same message.  You know, if I was accused of one thing it was being boring and consistent – well, that was fine because we were getting our messages across.  That’s what you want to create as an opposition leader.  Tony has done remarkably well to capture the agenda on this.  The Prime Minister is the Prime Minister, she has access to unlimited media, and it seems to me that she’s not made the most of it.  But then don’t look at me, because I oppose the carbon tax.  I don’t want to see it.  It’s going to hurt this state, and I’m going to continue to fight it.

Speers:  On the economy more broadly we’ve seen a few storm clouds this week, and Chris Pyne I appreciate you levelling a lot of blame to the government for that, but there are international factors here as well, the debt crisis in the US, President Obama signed off on the deal finally, but there’s still a big, big concern about US debt levels, debt levels in Italy and Spain and in Japan and elsewhere.  Consumers aren’t spending, retail figures we saw this week are terrible.  There’s a Productivity Commission report out that suggests some things that can be done about retail.  But all in all it’s a pretty gloomy outlook, it seems for the economy.  Premier, what do you think?  Should we be worried about the economy at the moment?

O’Farrell:  I’m worried.  Confidence is absolutely at rock bottom, and without confidence neither business nor consumers are going to spend.  If we don’t have spending, the economy doesn’t tick over.  If that doesn’t tick over we don’t get the revenues we need at a federal state level to provide the services.  So you know, for me, whether it’s the speculation of interest rate increases, whether it’s the speculation about hung parliaments, whether it’s other concerns, whether it’s concern about cost of living increases through electricity price rises or the carbon tax, it’s just sending the same message to individuals, to families, to businesses, which is just be cautious.

Speers:  So who do you blame for that?

O’Farrell:  I think we’ve all got a responsibility.  I think there’s responsibility out of Canberra, I think there’s responsibility out of some of our banking institutions including the Reserve Bank, I think there’s . . .

Speers:  . . . The Reserve Bank, which is sending mixed messages at the moment, rates are going up and down . . .

O’Farrell:  . . . Absolutely.  You know, the Telegraph, the Herald, the Australian, every time there’s a story about interest rates I’m sure that the retailers want to sort of go into the bathrooms and start checking their cabinets, you know.  The fact is that people aren’t going into shops.  Go through some of the major retail centres in Sydney, they’re down on people.  Or if they’re not down on people, they’re down on people who are buying.

Husic:  Premier, I know you’ve been in public life a lot longer, but I would imagine there will need to be a transition from being able to walk the lines that are right walked by an opposition leader and that of a premier, and I think we all have a responsibility to be able to point out the strengths of the state, particularly in this state, the biggest state in the country.  I think there is a lot going for the economy.  I mean we’re talking about confidence, sure.  But let’s go quickly through growth, ability to get into surplus, jobs.  The fact is, if people don’t have jobs they can’t spend, and we’ve got half the unemployment rate of some of these major economies. 

O’Farrell:  With a carbon tax coming to get us . . .

Husic:  . . . So we’re in a pretty good position. Well in terms of carbon tax, let’s look at that issue as well.  Coal production . . .

Speers:  . . . I think we have looked at that issue. 

Husic:  No, but in terms of economics.

Speers:  Yes, there’s investment in coal, you’re right.

Husic:  Investment in coal, doubling of production by 2050. 

Pyne:  David, if I make this comment briefly, we don’t want to get the talking points on the Prime Minister’s office just regurgitated . . .

[overtalk]

Husic:  . . . as opposed to your scintillating regional . . .

[overtalk]

Pyne:  One of the reasons why the economy is struggling is because of a lack of confidence, not just from the business community and consumers, but they don’t have a confidence in their federal government . . .

Husic:  . . . Don’t let reality stand in the way, Christopher.

Pyne:  There is no confidence at all in this hung parliament with this government that governs with the crossbenchers . . .

Husic:  . . . Rubbish!  . . .

Pyne:  . . . is actually getting anything done.  Nobody seriously believes the government is going to deliver a surplus . . .

Husic:  . . . Are you kidding!  Health, NBN, Malaysia, growth . . .

Pyne:  . . . in two years time of several billion dollars, when in the budget they said that the carbon tax was going to be revenue neutral.  Then they’ve revealed it’s actually going to cost $3.5 billion and they’re still saying they’re going to have the same surplus.  The Treasurer is not levelling with the public, and that’s why there’s a lack of confidence.

Speers:  But he’s entitled to come out and point out when we saw the market have a terrible day the other day, to come out and say look, we’re not the United States, we’re not Europe.  We do have debt levels that are far, far less; we’ve got pretty low unemployment.  The fundamentals aren’t bad here.

Pyne:  If you’d been listening to the diggers and dealers conference in Western Australia which you’ve been running on Sky, you’d see that they’re all saying that overseas investment is very concerned about Australia.  They’re very concerned because they have a lack of confidence in the federal government. 

[overtalk]

Pyne:  They have a lack of confidence about the mining tax, the carbon tax.  There was talk about a new bitumen tax that the government was talking about.  The fact that the Greens can run-

Speers:  Congestion tax.

Pyne:  The congestion tax, which is a tax on roads, on bitumen.  The Greens have got so much say over the government . . .

Husic:  . . . Ruled out.

Pyne:  So much say that overseas investors are very concerned about this country and they’re concerned the Treasurer never really levels with them about the true situation.  So of course they’re hanging onto . . .

Speers:  . . . Well is now the time to be floating thought bubbles like high speed rail?  Stay with us.  After the break we’ll have a look at that.

Speers:  Welcome back.  We’re joined this week by Labor MP, Ed Husic, Sky News presenter and former Labor Minister, Graham Richardson, NSW Liberal Premier, Barry O'Farrell, and Shadow Education Minister, Christopher Pyne.  I want to quickly look at the high speed rail idea that’s been revived again.   A feasibility study, in fact it’s the most detailed study that we’ve had in Australia into high speed, reckons it could be achieved at a price tag of up to $108 billion, stretching from Melbourne up through Canberra, Sydney, Newcastle and onto Brisbane, speeds of 350 kms an hour, and it’s even looked at what the ticket price could be, as much as $200 to go from Sydney to Brisbane or Sydney to Melbourne.  Barry O'Farrell, a good idea?

O’Farrell:  I think so.  I’m a fan of high speed rail. I think we’re talking here about a 30 year timeframe, so it’s not as if $108 billion has to be spent in one year.  So for me today, the message is let’s turn headline into action, let’s get the Prime Minister with the Premiers in a room and work out how feasible this is and whether it can be delivered.

Speers:  It would have to be taxpayer funded largely, wouldn’t it?

O’Farrell:  It probably would be, but we should take advice on that.  There are now many ways to get the private sector involved in these things.  But the one certainty, David, that I know is that there won’t be a second airport in the Sydney basin, despite Mr. Albanese’s wishes, so-

Speers:  So this would be a way of dealing with that. 

O’Farrell:  Absolutely.

Speers:  You’d put it in Newcastle or even Goulburn or Canberra?

O’Farrell:  Or Canberra.  So you know, I think the first leg should be Canberra/Sydney/Newcastle, and then you can sort of head south and north.  It would change the population distribution of this country.  It would be a genuine nation building project.  And look, I’ve just come back from China where they are building high speed rail at a rate of knots, and it’s a good, sensible thing to do.

Speers:  You sound pretty keen on it.

Richardson:  Let’s just all get a bit calm here!  China has got a couple of billion people, in a landmass that’s roughly the same size as Australia.  If you look at Europe, again many multiples of the population that we have in an area that’s actually smaller than Australia, and then you look at the US.  There’s just no way economically it will work here.  It can’t work!

Speers:  We don’t have the population?

Richardson:  We just don’t have the population and the distances are too great.  And so if you’re going to do it, it’s going to be an incredibly expensive exercise, not simply to build, but to run.  And to get on it, you’re going to need to be emptying your wallet very, very regularly . . .

[overtalk]

Speers:  I know Adelaide’s not even on the blueprint at the moment, but what do you think?

Pyne:  I think a very fast train is a wonderful, lovely idea.  But if it’s going to bankrupt the country, then it’s obviously not going to happen.

O’Farrell:  We’ll scrap the NBN and fund this.

Pyne:  The NBN is of course a tremendous expense, but this is even . . .

Speers:  . . . This would be, what, three times . . .

Pyne:  . . . This is like twice or three times the length of the NBN.  A very fast train is a great idea. It is a nation building project.  It’s important to have big infrastructure projects for all countries.  But if it’s going to bankrupt the nation, then you can’t do it.  I mean I would love to live in a enormous mansion and have six or seven cars . . .

Speers:  . . . That’s what this study is all about, it’s about showing where the ideas . . .

Pyne:  . . . but I probably wouldn’t be able to afford it. 

O’Farrell:  Everyone talks about it, but there’s never anything that you can actually point to, nothing firm in terms of a study to be able to go through the stats.  I mean I take on the board the point, absolutely, in terms of population sizes.  But there is one thing that stands out in my mind is that Sydney/Melbourne corridor is the fifth busiest air corridor in the world.  So there’s something to be said about looking at that and being to measure up how to actually do it, and they reckon half . . .

Speers:  . . . The study says it’s going to cost up $197 a ticket to go Sydney/Melbourne on the train.  You can get a flight for less than that if you shop around.

Richardson:  $150 at the moment.

Speers:  Exactly. 

Richardson:  As Transport Minister in 1992, I had one of these proposals wheeled up to me.  And even then you looked at the costs and I just threw it back and said ‘you’re kidding!’, and that was the end of the discussion.

Speers:  So why is the government running up the flagpole now?

Pyne:  Distractions and duds . . .

[overtalk]

Husic:  We had to, both parties said ahead of the 2010 election, I mean we made a commitment to look at it, you guys also made a commitment to examine this proposal as well, and they’ve gone through the preliminary, the first study, and it’s come out.

Richardson:  I think it’s okay to dream.  It’s okay to have visions, and it’s okay to have goals.  I think that’s what this is about.

Husic:  It doesn’t stack up.

Richardson:  But I just don’t think you’re ever going to get there.  But I mean it should be looked at.

O’Farrell:  You certainly won’t get there if all you do is produce a report.  So it’s got to be about doing something with the report, you know, getting some action out of these things.

Pyne:  I think it’d be a great idea if we could afford it . . .

Speers:  . . . And this might be a transport commitment we get you and Anthony Albanese agreeing on . . .

O’Farrell:  . . . Except, you know, he doesn’t agree about the Sydney Airport; he wants a second one in Sydney, which just isn’t going to happen.

Speers:  Another debate.

Husic:  He’s never said-

Speers:  Mike Rann, South Australian Premier, what’s going on there, Richo?  You had a bit to say about this on your show last night?

Richardson:  Yes, I’ve got a column in the Daily Telegraph-

O’Farrell:  He’s always got a lot to say!

Richardson:  I’ll write a column in the Daily Telegraph tomorrow about it too.  Look, unfortunately a lot of leaders simply never know when it’s time to go.  If you look at history in Australia, if you’re been a Premier or a Prime Minister and you’ve had seven or eight years, the reality is you’ve had enough and the public have had enough of you.  It doesn’t matter who you are, you know, your time comes and you wear out.  Wran knew when it was time, Beattie knew when it was time, they jumped.  Steve Bracks knew when it was time, he jumped.  Carr jumped. They all knew when it was time.  Now it’s been time for Mike Rann for a quite a while and he’s talked about leaving, he’s told the colleagues all the time that I’m about to go, I’m about to go.  ‘About’ never came, so they acted.  I’m surprised it took this long.

Speers:  But we’re now in this confused situation where he’s due back on the weekend from his trip to India.  I think the left faction in South Australia is saying, mate, if you don’t go straight away we’re going to bring on a vote.

Pyne:  They haven’t got the numbers by a long shot.

Richardson:  I don’t think it’ll go that way.  I don’t believe that there will be a ballot called on this week.

Speers:  But where does that leave-

Richardson:  But he won’t stay long.  He will not stay long.

Speers:  Where does it leave Jay Weatherill if Mike Rann decides to stick around, take his time, wait for the Olympic damn thing to be done?

Richardson:  I don’t think that’ll happen.  I think the pressure will be on fo