On Sunday 29 March Andrew Marr interviewed Kevin Rudd, Prime Minister Of Australia.
Please note ' The Andrew Marr Show ' must be credited if any part of this transcript is used.
The Australian Prime Minister, Kevin Rudd, plays down expectations of the G20.
ANDREW MARR:
Kevin Rudd, Prime Minister of Australia
Now then, just imagine a Left of Centre Prime Minister who had called for spending restraint before the crash and was still very popular now.
A bit hard to get your head round, but I am describing Kevin Rudd, the Australian Prime Minister, who is with me now.
Welcome, Prime Minister.
KEVIN RUDD:
Thanks for having me on your programme.
ANDREW MARR:
The G20…
KEVIN RUDD:
Yuh.
ANDREW MARR:
…a crucial moment for the world economy. Australia's had…How hard a time has Australia been having economically recently and what's your prognosis for the next 12 months?
KEVIN RUDD:
Well it's a global economic recession. It's affecting all economies, developed and developing. And to put it into context, I mean this is the first time in 2009 that we're going to see the global economy contract since the war. I mean this is a big, big event in economic history. You see the same in trade flows and investment flows. Therefore, in Australia we're affected like everyone else.
We're performing relatively well against most global economic benchmarks, our banks are doing okay, but this is a global contagion. On your question about the G20, given that this is a global economic challenge, only the G20 has the global economic reach to provide the response necessary to begin to mend this global economic recession and to support the restoration of jobs around the world.
ANDREW MARR:
It's pretty clear there's not going to be the huge coordinated fiscal stimulus that some have called for because not enough countries support that. So what in real terms do you want to get out of this? Do you think the world banking system needs to be radically reformed, and is that the kind of story that could come out of this?
KEVIN RUDD:
Well let me take your assumption head on. I think it's absolutely wrong, and let me tell you why. You see what we did back in…
ANDREW MARR:
On the fiscal stimulus?
KEVIN RUDD:
Yes, absolutely.
ANDREW MARR:
Yuh.
KEVIN RUDD:
Let me go back to where this began. The Washington G20 Summit in only November last year - it agreed that as governments around the world, we would commission fiscal stimulus as necessary and appropriate to support growth and jobs given the challenge ahead in the global economy. What's happened since then? Since then governments around the world have agreed in calendar year 09 on action already equal to about 2% of global GDP. That's 2% of a 63 trillion dollar global economy.
What does the IMF tell us about the impact of that? That action alone, equalling 2% of global GDP, means supporting nearly 20 million more jobs than would otherwise be the case. In other words, global unemployment in these economies will be 20 million worse, and I think it is absolutely important that we recognise the consistency of that. And let me just add…
ANDREW MARR:
Sorry, could I just…
KEVIN RUDD:
One further point. One further point and then you come back on me. In London just a couple of weekends ago, you had G20 finance ministers, including everybody - Europeans, the Brits, ourselves. What did it agree on? It agreed to continue to support fiscal stimulus and to use the International Monetary Fund to assess in the future what further stimulus beyond 2009 we may need. That is into 2010. What I see across these three critical meetings is actual consistency; and had we not acted, would you want 20 million more people unemployed? I don't think so.
ANDREW MARR:
No, but what we're talking about there is as it were past decisions already taken.
KEVIN RUDD:
No, no…
ANDREW MARR:
Barack Obama's done his.
KEVIN RUDD:
…an agreement, an agreement on how to handle it in the future as well - the mechanism being an IMF assessment as to how it's done. I think there's…
ANDREW MARR:
(over) The French and the Germans say you know no to another big fiscal stimulus. Britain has spent about as much money as is possible. The same is probably true of what Barack Obama is doing. There's not going to be a second wave of fiscal stimulus as a result of this week's meeting, is there?
KEVIN RUDD:
Well let's go to the numbers. In America you have fiscal stimulus of something like 5.4% of GDP. For us, about I think 4.6% of GDP. The Germans, 3.6% of GDP. And in calendar year 09 people are acting in broadly the same order of magnitude - some differences here, some differences there. That's the action we commissioned only four or five months ago. It is now done.
The job's impact is about 20 million strong. Go to the future, what we've also agreed is let's put some maths to this, use the International Monetary Fund. And all finance ministers - German, British, Australian, American -agreed only a few weekends ago that we would use the IMF to assess what we would need for calendar year 10. So I think there is a great and I think disproportionate emphasis about disagreements at the margins when in fact much has concretely been achieved with a mechanism for the future.
ANDREW MARR:
So we should not be looking to the final communique for more numbers and new numbers that we haven't seen before?
KEVIN RUDD:
But that was never the intention.
ANDREW MARR:
(over) Okay, let's be clear about this.
KEVIN RUDD:
I think this has just been quite wrong and a mechanism has been established for us to reflect on for what we need for the future. And there'll be a further summit well in time for 2010, I assume, which will actually look at what metrics would be needed then, what numbers then. I think we need to…
ANDREW MARR:
So…
KEVIN RUDD:
... we actually need to look at what's been done and the impact of what would have occurred in the global economy had that not occurred.
ANDREW MARR:
So when George Soros for instance says that if this summit isn't a success, doesn't change things, the world is heading for depression - that's wrong?
KEVIN RUDD:
Well the fiscal stimulus debate that you and I have just been engaged in is one of about four or five sets of integrated measures. The other is dealing with toxic assets on bank balance sheets. Progress has been achieved here in Britain and in America and elsewhere. A framework is agreed for how that should be done.
Avoiding further acts of protectionism; dealing with the resources necessary for the IMF because if we don't have proper resources for the International Monetary Fund the big problems emerging now in Central and Eastern Europe would in fact rebound on the rest of the global economy. And in each of these four areas, there is real, measurable progress, and a further work programme for the future.
ANDREW MARR:
And you think there needs to be another G20 meeting before too long to keep that progress moving forward?
KEVIN RUDD:
I think momentum is necessary. I think if you step back from all this and ask yourself this question - when else in modern economic history have global economies cooperated and coordinated across such a vast array of policy instruments? - it hasn't happened.
Gordon Brown has been in the centre of this at the Washington Summit, but most particularly in the lead up to this one, and that coordination role on the part of the British has been first class. You're never going to get a perfect outcome in these circumstances, it's a political process. But against what has existed previous, I've got to say we need to see the glass as being more than half full…
ANDREW MARR:
Okay.
KEVIN RUDD:
…on these questions rather than emphasising what has yet to be done.
ANDREW MARR:
Everybody is focusing for obvious reasons on the financial crisis, but you've had some terrible fires in Australia. There is also the huge question of climate change. Talk about another big summit on that as well coming up I think before too long. How important is it that this financial crisis is a moment when people start to turn their economies in a different direction when it comes to low carbon technologies and all of that?
KEVIN RUDD:
You're right to raise the fact that we have a challenge now of dealing with the global financial crisis, a real challenge in the economy and jobs. The interconnectedness of what happens on banks in the City of London and banks on Wall Street and what happens with jobs in Brisbane and what happens with jobs in Birmingham, these are all linked. But at the same time, what we need to also bear in mind is that this continued challenge of climate change is a massive economic challenge as well.
It's very clear that the costs of economic…the costs of inaction on climate change in economic terms are far greater than the costs of action, so, therefore, when we look at stimulus, we look at the other things that are necessary to deal with the economic crisis, we should also be taking steps to prepare ourselves for a more sustainable carbon future as well.
ANDREW MARR:
Alright. For now, Kevin Rudd, thank you very much indeed.
INTERVIEW ENDS
Please note "The Andrew Marr Show" must be credited if any part of this transcript is used.
NB: This transcript was typed from a recording and not copied from an original script.
Because of the possibility of mis-hearing and the difficulty, in some cases, of identifying individual speakers, the BBC cannot vouch for its accuracy
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