FRAN KELLY: And as we discussed earlier, the G20 has set itself the ambitious task of finding a global solution to the great recession of 2009. The Prime Minister Kevin Rudd will be around the summit table, and later today he'll be joined in London by Treasurer Wayne Swan ahead of the talks.
Federal Finance Minister Lindsay Tanner joins us from Melbourne. Minister, good morning.
LINDSAY TANNER: Good morning, Fran.
FRAN KELLY: Lindsay Tanner, what is a stake at this G20 meeting?
How important is it for some kind of concrete outcome from these talks?
LINDSAY TANNER: I think it'll clearly have an influence on the speed of global recovery, Fran. You've seen a number of issues being put on the table: the question of some kind of overall global coordination of financial regulation's very important; greater stimulus to economic activity around the world is another one; and of course the international financial regulatory architecture with the IMF reforms that are proposed; and finally assistance for developing nations.
So, all of those issues are pretty important to the question of how quickly we see economic normality being resumed. I think that's the real issue, is speed of recovery.
FRAN KELLY: Economic normality; that's the Holy Grail. In terms of global coordination, there is not a unified position on the key issue for this summit, which is how best to stabilise and stimulate the world economy.
Do you fear the split between European countries and the position taken by Australia, the US and Britain will mean that there is no firm outcome from the summit?
LINDSAY TANNER: That's obviously a possibility, but I think it's fairly unlikely. You've got different countries influenced by different circumstances, but I note, for example, that Germany some time ago was ardently opposed to any kind of stimulus measures and then by sheer economic realities was forced to take some significant stimulus measures. So, I'd be optimistic that you'll see an overall outcome; precisely what it'll consist of, of course we can't predict.
But I think there is a pretty strong sense of urgency all around the world, it's just the emphasis is different in different places. So the Europeans are much stronger on stricter regulation, whereas of course the Americans are very strong on getting stimulus happening.
FRAN KELLY: Mmm. Would you - what would you describe as a positive outcome from the summit?
LINDSAY TANNER: Oh, I think overall agreement with some substantive elements to it that ensures that we do move quickly across the globe.
I think the - we shouldn't underestimate the significance of the American decision to fill in the details of its rescue of the banks and tackling the toxic asset problem. I think that will probably galvanise people across the world. That's been really a sticking point for a lot of countries that - the American failure to really tackle that toxic asset problem which has been very much at the centre of the global economic crisis.
FRAN KELLY: Okay. Can we move now to the debate over Defence Minister Joel Fitzgibbon, because on the weekend you accused Opposition Leader Malcolm Turnbull of basically stirring up the spectre of the yellow peril. He described those comments as contemptible.
Let's have a listen to his response.
[Start of excerpt]
MALCOLM TURNBULL: And now we have the Finance Minister, when important matters of national interest are raised, instead of dealing with them on their merits, he tries to raise spectres of racism and casting back to bygone eras.
And Mr Tanner's remarks suggest that we should just fall into line with whatever China wants. That's not in Australia's interests, and it is not an approach that China would respect.
[End of excerpt]
FRAN KELLY: Minister, are you trying to divert this debate by playing the race card?
LINDSAY TANNER: Oh, of course not. In fact, I'm not playing the race card, I'm pointing to the fact that somebody else is. And we've seen Malcolm Turnbull effectively suggest that Kevin Rudd is acting in China's interest, not in Australia's interest. That's a pretty serious accusation to make.
And the suggestion that we are supinely just lying down and agreeing to whatever China wants is most obviously contradicted by the most recent Government decision, which was to deny the Chinese investment in the OZ Minerals company. So, we've got a situation where the facts just don't even fit the accusations that Malcolm Turnbull's throwing around.
We do have to deal with these issues on their merits, on a case by case basis. But whether any of us likes it or not, China looms very large in Australia's circumstances now, and even larger in our future; and the fact that we have got a person who is an acknowledged China expert who speaks Mandarin as Prime Minister is of great benefit to the country in dealing with these things.
FRAN KELLY: I want to come to the Minmetals decision in a minute, the OZ Minerals decision in a minute.
But just to stay with the behaviour of the Defence Minister, I mean the fact is Joel Fitzgibbon failed to declare two privately-funded overseas trips. He failed to declare those to the Parliament, even when he was asked directly about them. The Opposition has every right to call for a sacking. Why isn't that a sackable offence?
LINDSAY TANNER: Look, he's indicated that he's made a mistake; he's apologised for that mistake…
FRAN KELLY: He was asked directly about those trips…
LINDSAY TANNER: I…
FRAN KELLY: … and he didn't recall them. Do you find that believable?
LINDSAY TANNER: Well, yes, I do, because people have lots of things happening over their time in Parliament and these, of course, were a number of years ago. I think the earlier of them was about seven years ago; so that's quite a long time.
Obviously, I can't make any commentary about what's going on in the Defence Minister's mind, but I don't regard it as a sacking offence. He came clean very quickly; as soon as he realised that he made a mistake there was a - the amount of time that's transpired between his initial statement and then stating that he had taken these trips was very short. And I think that this clearly doesn't warrant the kind of thing the Opposition is calling for.
We've got a wider picture here and the Defence Security Agency is inquiring into what's gone on with respect to the accessing of the Defence Minister's computer. I think that that's where the serious questions lie.
FRAN KELLY: Minister, back to the Government's rejection of China's Minmetals' bid for OZ Minerals; basically, have you just conceded this was made in a political context and is not really about national security?
LINDSAY TANNER: No, I haven't conceded anything of the kind; I've just used that as an example that Malcolm Turnbull's claim that the Government just rolls over and does everything that China wants is completely untrue. And that is a fairly simple example of it where…
FRAN KELLY: Is that what you're trying to prove here with this decision though?
LINDSAY TANNER: No, that - of course not. It's a decision that's been made on its merits on a case-by-case basis. And if you look back over the recent records you'll see that there have been some Chinese investments in Australian companies that have been impr… approved and some that haven't been. They've been determined by the Treasurer under the Foreign Acquisitions and Takeover Act on their merits, as they should be and as have - has occurred under previous governments.
So, I'm just simply making the point that Malcolm Turnbull, by trying to draw all these threads of unrelated interactions with China together into some overall picture suggesting that the Australian Government is, in effect, in hock to China taking its decisions based on a supine attitude to China, is completely wrong, and it is deliberately designed to play to historic antagonisms to Asia and China that are still latent in part for the Australian community. And that's what I'm pointing to and that's what I'm rejecting.
FRAN KELLY: It's ten to eight on Breakfast; our guest this morning is Finance Minister Lindsay Tanner.
And Minister, are there any national security implications for China's share and asset deal in Rio Tinto?
LINDSAY TANNER: I'm not in a position to comment on that, Fran, because the details of the deal are not before me; they're before the Treasurer. He has a specific personal role in making the decision on this issue. So I'm not in a position to answer that one way or the other, I'm afraid, because I - my only knowledge of the deal is what's in the media, literally.
FRAN KELLY: It's a pretty charged atmosphere that this decision's being made in.
LINDSAY TANNER: Oh, that's true, but I think you'd find that irrespective of some of these recent events, that would still be the case. You've got a company that is heavily debt-laden as a result of one particular acquisition at the height of the boom. It's a critical company for Australia's future. Its resources that it exploits are central to our future, as well. And you've got a very complex investment structure that makes it quite difficult to form a view about exactly what's going on here and what the implications are for our national interest.
So, yes, it's a pretty important decision, that's right.
FRAN KELLY: And just finally, and briefly, Minister - we must go - but the OZ Minerals deci… is on the brink of administration; it's a brave government that allows a company to go down when jobs, jobs, jobs is your slogan; 600 jobs at stake here.
LINDSAY TANNER: Clearly, the Treasurer has a responsibility under the legislation to make a decision in the national interest and that involves a number of issues. And the economic activity that's involved with the company is clearly of great significance in that decision-making; but the resource is still there, Fran. And that's the thing that you need to keep in mind when you're considering this is that the resource and the potential for it to be exploited, the jobs that are associated with exploiting that resource remain there and are likely to be exploited at some point, irrespective of this specific decision.
So, yes, that's an important issue, but there are other issues, as well.
FRAN KELLY: Lindsay Tanner, thanks very much for joining us on Breakfast.
LINDSAY TANNER: Thank you very much, Fran.
FRAN KELLY: Lindsay Tanner is the Federal Finance Minister joining us there from Melbourne.
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