FRAN KELLY: Despite what the Opposition decides to do in the Senate the Government needs to find savings to fund its health reform package worth around $5.4 billion in the immediate. Tony Abbott says the IMF's latest report on global growth and the Australian economy is not an endorsement of the Government's economic management. The IMF sharply upgraded our growth forecast for this year and next and predicted Australia and the newly industrialised economies of Asia would likely, quote, stay in the lead of the global recovery. Finance Minister and Acting Treasurer Lindsay Tanner joins us now. Minister, good morning.
LINDSAY TANNER: Good morning, Fran.
FRAN KELLY: Let's start with the good news, the IMF has given the Australian economy a pretty powerful endorsement, it would seem. Growth this year up from 2.5 per cent to 3.0 per cent and from 3.0 to 3.5 for next year. Does that match the forecast we're going to see in the Budget?
LINDSAY TANNER: Because the IMF forecasts are for a calendar year it's not easy to match them up for the financial year forecast that we put forward, Fran, but clearly there's been a range of data around in recent times suggesting that things are improving. We'll see in the Budget, of course, what the actual projections are from Treasury on this front but it indicates that Australia is emerging more quickly from the problems of the global financial crisis than most other countries and our economy is in better shape than pretty well any other developed economy.
FRAN KELLY: This would make your job easier, wouldn't it? It would mean you wouldn't have to be wielding the axe quite as hard in the Budget to find the $5.4 billion to pay for the health deal.
LINDSAY TANNER: Not really because the rules that we've put in place about the rate of growth in government spending and about matching new spending with savings mean that even when things improve faster than perhaps we expected, we still have to meet those rules in order to get the Budget back into surplus as quickly as possible and ensure that the debt we've incurred as a result of the global financial crisis gets paid off as quickly as possible. So we've got a pretty tough task still in front of us.
FRAN KELLY: So does that mean you're going to stick to the promise that higher receipts from growth will be used to pay - to pay off the - to pay off the deficit?
LINDSAY TANNER: Yes, it does, in fact, any additional receipts above and beyond what we're expecting, you know, better tax receipts than we were anticipating, we've committed to use those to get us back to surplus quicker than was otherwise going to be the case, pay down debt quicker than was otherwise going to be the case, and we'll stick to that.
FRAN KELLY: So how are you going to find the $5.4 billion in health - health - for health spending? Is it going to have to come from within the health budget as it currently stands?
LINDSAY TANNER: Oh, not necessarily. We've got a wider exercise on here, Fran, so it's not just about this commitment. Obviously it's a pretty substantial commitment but we've, of course, got at any time a range of issues going both up and down, so to speak, both new spending, savings, all of which have to come into the mix and we've got to make it all add up and…
FRAN KELLY: But what you're saying clearly, though, is if you're going to stick to those pledges to return the Budget to surplus by banking any increase in tax receipts, that you're going to find this $5.4 billion through savings, through cuts.
LINDSAY TANNER: That's correct and it won't be the only savings we have to find.
FRAN KELLY: So it's going to be pretty tough.
LINDSAY TANNER: Exactly.
FRAN KELLY: So I'd suggest that people, like Ian - Professor Ian Hickey who we had on the program this morning, saying that mental health services have been left pretty high and dry, with this health package, there's not going to be any hope of any new money for something like mental health in the Budget?
LINDSAY TANNER: Well, I disagree with that assessment, Fran. We've just announced a very substantial increase in the headspace program which is a very successful program headed by the Australian of the Year, Patrick McGorry, who lives and works in my electorate. I know him well.
FRAN KELLY: Sure, but $174 million for health - for mental health, is a long way short of what people like Patrick McGorry and Ian Hickey have been saying is needed.
LINDSAY TANNER: Oh, it's - look, there's always more that can be done and, yes, obviously I and others would be wanting to do more in this area. It's been neglected for a long time but I don't think we should understate the significance of this initial commitment and it's part of a much bigger commitment where we have to get our health sector into decent shape. We've put in place some very substantial reforms that will tackle the problems of waste and duplication and inefficiency that have bedevilled our health system for many years. We've got a bit set of work in front of us now to put those things in place and the mental health picture is part of that.
FRAN KELLY: You've got to get your health funding package through the - health package through the Senate, of course. Tony Abbott's giving no guarantees yet. He said he hasn't seen the legislation. He doesn't think the Government's looked up to its promises - lived up to its promises. Western Australian Premier Colin Barnett has said this yesterday, that - to this program yesterday - that this move to take back 30 per cent of the state's GST opens the door and could see the GST disappear. What guarantee is there that you will not commandeer future proportion of the GST or try and wind back more?
LINDSAY TANNER: The Prime Minister has given that guarantee and we've got a detailed discussion to occur with Western Australia. Circumstances vary from state to state and we believe that Colin Barnett has approached this whole issue in a very constructive and appropriate way so we're going to sit down with Mr Barnett and the Western Australian Government and endeavour to work through it and Tony Abbott's just continuing to snipe. We are months away from an election, Fran, and still we have zero health policy from the federal Opposition. All they're doing is blocking our reforms, blocking the means testing of the private insurance rebate so that the taxpayer no longer subsidises the private health insurance of people like me on very substantial salaries or millionaires like Malcolm Turnbull. These are being blocked by Tony Abbott but we are still yet to see any health policy at all. It's about time he stopped the sniping and started to put forward his alternative for the Australian people to consider.
FRAN KELLY: We've only just got yours.
LINDSAY TANNER: Fran, we've been putting in place health initiatives since we took office. We've had very substantial additional payments to the states on a range of areas, things like an elective surgery payment, the $600 million that occurred in 2008, so we have been rolling out health policies and initiatives since we took office and we've been working on this program.
Keep in mind that there was a National Health and Hospitals Commission report last year that was based on our commitment, giving a recommended path forward and we've then been working on that so the genesis of what has just come to fruition over the last few days has been some time ago and has been gradually building so there's been no secret about what the Government's been working on, it's just been a very big, tough proposition. Mr Abbott, we've had absolutely nothing from him or the Liberals.
FRAN KELLY: It's nine minutes to eight on Breakfast. Our guest this morning, Finance Minister, Lindsay Tanner. Lindsay Tanner, reports in this morning's newspaper that the household insulation rebate, the $1000 rebate plan, will be scrapped altogether. Can you confirm that?
LINDSAY TANNER: Look, I've - I've had these reports described to me, Fran, I haven't read them but they suggest that Cabinet's made decisions and so on, I gather. Well, I'm not going to comment on what the Cabinet deliberations are and what decisions we've been made but we're focussed…
FRAN KELLY: Well, there's people out there who might be planning to put insulation. Can you tell them whether they're going to get a rebate any more?
LINDSAY TANNER: I can't comment on the suggestions in the report. As I say, I haven't had an opportunity to actually read the report. I'm sure I'll be able to do that very shortly.
FRAN KELLY: Well, let me tell you, one report says it's going to be scrapped, the other said it's going to go into suspension for longer.
LINDSAY TANNER: I'm afraid that I can't comment on Cabinet deliberations but we are focussed very intently on dealing with the problems that have emerged in the home insulation program, of dealing with the checking of people who are at risk and making sure that we fix those problems. That's our key priority in this area and that's what we're going to continue to focus on.
FRAN KELLY: Lindsay Tanner, thanks very much for joining us.
LINDSAY TANNER: Thanks very much, Fran.
FRAN KELLY: Finance Minister and Acting Treasurer, Lindsay Tanner.
| Media Contact: | Website: |
|---|---|
| Nardia Dazkiw - 0418 144 690 | www.financeminister.gov.au |
