DAVID MARR: The High Court this morning said however you arrive in Australia, if you seek refugee protection in this country, the assessment of your claim will be done according to law and according to the principles of natural justice. That’s what they said this morning and as of 10 o’clock when business resumed, I suppose, with the assessors, they’re the rules they’re operating under.
DAVID SPEERS: Simon Birmingham, does that then throw into doubt in your mind the whole idea of processing asylum claims offshore?
SIMON BIRMINGHAM: Not at all, David. Let’s understand that from 2001 when offshore processing was introduced by the Howard Government through Nauru, through a statutory legislative process, right through until 2007, there was no successful claim through the High Court of this nature. What happened was in July 2008 the Rudd Government decided to end Nauru, to implement a non-statutory framework for actually considering these applications and it is this process and this framework introduced by the Labor Government that has been overturned today. Now, this is going to have huge ramifications, of course, for taxpayers, for the Government because of course there are thousands of people currently in detention in Christmas Island, on the mainland, elsewhere. These people of course will all, as David [Marr] says now have full rights of appeal, potentially, through these legal avenues which of course will have enormous cost ramifications that taxpayers will be forking out for some time to come.
DAVID SPEERS: And if the advice is that offshore islands should have access to the court system as the High Court seems to have found, what is the point, getting back to the question… what is the point of offshore processing?
JASON CLARE: Well let’s wait and get that advice. Let’s wait and get that advice from the Solicitor-General.
SIMON BIRMINGHAM: David. I think there’s a key difference here between offshore processing as it was done and offshore processing as it is now done under this Government and it is a difference around access to the courts. The access to the courts through offshore processing in Nauru is quite different to access to courts through Christmas Island.
DAVID SPEERS: But were they detained by Australia in Nauru?
DAVID MARR: Yes, of course they were. But the really interesting question arises… if you get up a regional processing system in East Timor, that I think opens up a completely different ball game.
DAVID SPEERS: Why’s that?
DAVID MARR: Because Australia won’t necessarily be the detaining power in East Timor.
DAVID SPEERS: But wasn’t Nauru the detaining power in Nauru?
DAVID MARR: Oh, in effect, look…
DAVID SPEERS: I mean I take (unclear), the letter of the law…
SIMON BIRMINGHAM: Indeed I think there is a technical definition around whether they were detained by Australia in Nauru, and that is certainly something that could still be…
DAVID MARR: The law as it stands at the moment is a law that allows Australia to intercept people and take them to Nauru and that’s what the High Court said. The High Court didn’t say it was invalid. All the High Court said was if you’re gonna do it, the courts have got to be looking over people’s shoulders to make sure that people are dealt with fairly and I honestly, honestly, can’t see what there is to worry about.
SIMON BIRMINGHAM: One of the problems with that, David, and one of the key problems with that is it is going to see people in detention for longer. This is what we saw, of course, under the days of the Howard Government and you were a serious critic of, during the early days of the Howard Government, the length of time people were in detention and they were in detention for so long because of course they were appealing ever upwards in the process…
DAVID MARR:  No, no, I’m sorry…
SIMON BIRMINGHAM: … appealing at taxpayers’ expense as well.
DAVID MARR: … this possibility of appeal for people held offshore arose at 9.30 this morning.
SIMON BIRMINGHAM: No, it existed prior to 2001 as well and you were a fierce critic of it [unclear] length of time.
DAVID MARR: People were held on Nauru under a system which forbade them to appeal to the Australian courts and some of those people were held on Nauru for five years. That is a very long time. Now, if they have to be held a little bit longer in order to get a bit better, more lawful, fairer outcome, I think that that’s something none of us should be worried about.
SIMON BIRMINGHAM: I think it’s a question of whether it’s a fairer, more lawful outcome or whether, as Jason [Clare] indicated before, you simply promote gaming of the system that you end up with people…
DAVID MARR: You’ve gotta have terrifically good procedures to make sure the system is not gamed, particularly by corrupt migration agents. 
TOM SWITZER: Boat people flow has increased somewhat since mid to late 2008, though, correct? Why is that?
SIMON BIRMINGHAM: Quite significantly, not just somewhat.
DAVID MARR: Tom, I have this delicious thought in my mind that up there in Java today ruthless people smugglers were poring over the High Court’s decision and seeing here the [unclear] of a whole fresh field
SIMON BIRMINGHAM: David, they won’t pore over the High Court’s decision but they’ll be reading your column.
ALL: [Laughter]
DAVID SPEERS: Perhaps on that note we need to take a quick break. Stay with us, we’ll be back in a moment.
DAVID SPEERS: Simon Birmingham, is there honestly general agreement between the two major parties on competition and how to deal with this issue of bank interest rates?
SIMON BIRMINGHAM: Well, there’s perhaps agreement on rhetoric. Where we’re struggling at is agreement on reform because we’re not seeing a reform agenda coming from Government, and so yes, we all think the banks should behave more responsibly and yes, we all think that there should be some type of reform to engender some competition. We’ve seen Joe [Hockey] go out and outline a nine-point plan, we’ve seen Andrew Robb out there talking of course about the impact that the bank guarantee has had on competition in the sector and of course driving many of the small lenders out of the sector. We’re not seeing the Government proposing anything substantial [unclear].
DAVID SPEERS: Well that’s because they’re working with the various agencies and also the G20 as you might have noticed is meeting in Seoul and they’re talking about international rules that are going to change for the banks as well. Shouldn’t the Government wait until that’s nailed down?
SIMON BIRMINGHAM: Well those international rules are about of course ensuring that we have very stable banks in Australia for the future and that’s important. We, of course, have very stable banks in Australia and it’s a product in many ways of what Joe Hockey did back when he was Financial Services Minister in setting up the type of structure we have today and that’s fine, but of course we’ve seen the Government responded to the GFC, took a large part of competition out of the sector, of those small lenders, we need to find ways to get them back, we need to make sure that we’re actually encouraging people to have fair dinkum competition in the banking industry and what we’ve seen this week is the ANZ’s announcement of a real sort of one-fingered salute to the Government where not only did they jack the interest rates up but they said ‘we’ll take off exit fees, we’ll happily take away exit fees’ which was all the Government had been calling for at this point, because they knew that the fees aren’t the deterrent, it’s the lack of competition and the lack of alternatives that’s the problem.
DAVID SPEERS: Simon, I guess the risk is that we could see another global shock, and that’s quite possible, and you look at the ongoing problems in Europe in particular but also the sluggish performance of the American economy as well. If we do start ripping money out of Government spending and really pare back on that, could we taking too much of a risk?
SIMON BIRMINGHAM: Well look, David, we’ve got to manage the situation we have in Australia. We survived the GFC because we had sound banking policies set up in the 1990s that ensured we had secure financial institutions, because we have fantastic trading relationships into Asia, with China in particular, and so we are a far more diversified economy than you expect perhaps in the rest of the world, and especially in Europe and in North America, so those factors remain to keep us secure. 
It’s ‘Economics 101’, though, that you have basically two primary levers – monetary policy and fiscal policy. Monetary policy’s outsourced to the independent Reserve Bank and they’re saying ‘we’ve got to put the brakes on, you’ve got to put the brakes on’ and the Government is not putting the brakes on. It’s all very well to talk about returning to surplus in three years’ time…
DAVID SPEERS: But is the Reserve Bank really saying the Government should put the brakes on? Where have they said that?
SIMON BIRMINGHAM: The Reserve Bank has actually given that message in their past…
DAVID SPEERS: No, no, they’ve said they’re putting the brakes on monetary policy.
SIMON BIRMINGHAM: And read through some of their past findings…
DAVID SPEERS: … strongly defending the stimulus program and stimulus wind down.
SIMON BIRMINGHAM: They may have defended the need for stimulus, they are definitely highlighting there’s a need to reign back Government spending. They’ve highlighted that in some of their statements of reasons on previous rate rises, I haven’t gone through the Melbourne Cup one to see but they definitely have along with of course many other economic commentators, many people outside of Government, and this Government is just failing to take the difficult decisions to actually bring in the spending and do so faster than basically what would see them continue on their merry way with all of their stimulus promises, all of their election promises, everything else they might think of over the next few years.
SIMON BIRMINGHAM: And what we have, though, is a Government, once again it’s a ‘rhetoric versus reform’ type approach. The Government in its first three years, we know it commissioned the Henry Tax Review, got a truckload of recommendations of things that it suggested it should look at, shelved them all because they were too difficult with the exception of a mining tax which has gone from hard to difficult to worse.
JASON CLARE: It is what you invest in things like making people ready to work, and more people participating in the economy, and infrastructure for making things get to port or get to destination or people to get home quicker, things like public transport, things like expanding ports, building roads, inland rail lines… all of those things increase the capacity of the economy to grow at the speed that it wants to. They’re the key things that allow sustainable growth to happen without inflation growing out of control.
SIMON BIRMINGHAM: I notice there weren’t any Pink Batts or school halls in that list, Jason.