LEIGH SALES, PRESENTER: To discuss the BHP announcement today and other issues I was joined moments ago from Parliament House in Canberra by the Opposition Leader Tony Abbott.

Tony Abbott, welcome to the program.

TONY ABBOTT, OPPOSITION LEADER: Evening, Leigh.

LEIGH SALES: You were pretty loose with the truth today, weren't you, when you said that BHP's decision to put the Olympic Dam project on hold was partly due to the Federal Government's new taxes?

TONY ABBOTT: Not at all, Leigh. For months BHP have been warning that the carbon tax and the mining tax are making Australia a less competitive place to invest. And Marius Kloppers himself said back in June that the carbon tax and so on are all conspiring to turn Australia from a low cost to a high cost environment.

LEIGH SALES: Well let me read you exactly what Marius Kloppers had to say today when he was asked if the decision on Olympic Dam was related to Australian taxes. He said, "The decision is almost wholly associated with in the first instance capital costs." He goes on to say "As you know, the tax environment for this particular project has not changed at all since we started working on it six or seven years ago. The MRRT only covers coal and iron ore, not copper, not gold and not uranium, so the tax situation for this project has not changed."

TONY ABBOTT: And, Leigh, let me read you what Jacques Nasser said back in May. He said, "I cannot overstate how the level of uncertainty about Australia's tax system is generating negative investor reaction." Sure, today, today, Marius Kloppers didn't want to make a very bad situation worse by directly blaming the Federal Government. Of course he didn't want to directly blame the Federal Government. But for months, for months BHP has been sending signals to the Government this build-up of tax, this build-up of high costs is making it much more difficult for this investment to go ahead.

LEIGH SALES: But, today, if you're right, then why does it say nowhere in the BHP statement that there's anything to do with the Federal Government? If you go through the documents they blame weakness in commodity markets, industry-wide cost pressure, instability in the eurozone, the slowdown of growth in China. They haven't been backwards in criticising the Federal Government before, but they certainly haven't today.

TONY ABBOTT: And, Leigh, they didn't need to say it today because they've said it so often in the recent past.

LEIGH SALES: Well they listed everything else that was to blame.

TONY ABBOTT: You're not seriously - you're not seriously telling me, Leigh, that the mining tax and the carbon tax have made Australia an easier place to invest in.

LEIGH SALES: I'm going on the facts that Marius Kloppers said today when he was directly asked if the decision on Olympic Dam was affected by Australia's tax situation and I'm going on the facts that are outlined in their results statement that they've issued. Have you actually read BHP's statements?

TONY ABBOTT: No, but I've also got again the statement of Jacques Nasser, who says, "While we're still evaluating the impact of the carbon tax, but it just makes it more difficult."

LEIGH SALES: But hang on, no, no, you haven't read their statements today, but you're commenting about what they've announced today and how the Federal Government's to blame for that.

TONY ABBOTT: Leigh, I didn't say that the carbon tax and the mining tax were solely to blame. I said that the carbon tax and the mining tax have created an environment where it's much more difficult for investments like this to go ahead. I bleed for the people of South Australia tonight because there's 8,000 construction jobs, 4,000 production jobs and 13,000 associated jobs that are at the very best on indefinite hold because of this decision.

LEIGH SALES: How do you know more what's to blame though?

TONY ABBOTT: And the mining tax and the carbon tax make a bad investment environment much, much worse.

LEIGH SALES: How do you know more what's to blame than Marius Kloppers, who I presume has read his own documents?

TONY ABBOTT: And, Leigh, I've been reading what they've been saying for the last few months.

LEIGH SALES: Tony Abbott, on the carbon tax you've been saying that it would be a wrecking ball through the economy, but if you look at the latest jobs figures, more people are in employment, the economy continues to grow solidly, inflation is low. Are you once again being a little bit loose with the facts there?

TONY ABBOTT: Leigh, 1st July wasn't the end of the pain; 1st July is the beginning of the pain. And the carbon tax, don't forget, just goes up and up and up. It's $29 a tonne in 2015, it's $37 a tonne in 2020, it's $350 a tonne in 2050, if it's not repealed. Now, it is, as I've been saying, a python squeeze, not a cobra strike, but it starts to hurt from day one.

LEIGH SALES: But where is the evidence if it's hurting from day one of a wrecking ball through the economy?

TONY ABBOTT: Well, I think that we can say that in some ways at least the postponement of Olympic Dam is the biggest victim so far of the new taxes that this government has put in place.

LEIGH SALES: Marius Kloppers said - I don't want to quote it again - but that, "... the tax environment for this particular project has not changed and that it has associated this decision to delay with capital costs."

TONY ABBOTT: And capital costs are obviously more difficult in a situation where the company is massively impacted by the mining tax and the carbon tax. Let's not forget for a second, Leigh, BHP with Rio is Australia's biggest iron ore producer. BHP is one of Australia's biggest coal producers. They are all impacted big time by the mining tax.

LEIGH SALES: They've announced a $15 billion profit today.

TONY ABBOTT: About one third down on last year, and in any event, that's a profit based on past results, it's not a profit based on the results of the future. That's what they're looking at now; they're looking at future prospects, not past results.

LEIGH SALES: Why have you referred repeatedly to illegal asylum boats coming to Australia? Do you accept that that's illegal and that seeking asylum by any means is legal?

TONY ABBOTT: Most of the people who are coming to Australia by boat have passed through several countries on the way and if they simply wanted asylum they could have claimed that in any of the countries through which they'd passed.

LEIGH SALES: But I don't believe that it's actually illegal to pass through countries on your way to somewhere where you want to have asylum.

TONY ABBOTT: You try turning up in America without documents, without a visa, without a passport; you'll be treated as very, very much illegal, Leigh. The other point I make, from recollection at least, is that the very term that the Government has officially used to describe these vessels is "suspected illegal entry vessel".

LEIGH SALES: Do you - I'm asking you though, not about the Government. I'm asking: do you accept that it's legal to come to Australia to seek asylum by any means - boat, plane - that it is actually legal to seek asylum?

TONY ABBOTT: I think that people should come to Australia through the front door, not through the back door. If people want a migration outcome, they should go through the migration channels.

LEIGH SALES: That's an answer to the question if I asked you: how do you think people should seek asylum?, it's not an answer to the question: is it legal to seek asylum?

TONY ABBOTT: And Leigh, it's the answer I'm giving you because these people aren't so much seeking asylum, they're seeking permanent residency. If they were happy with temporary protection visas, then they might be able to argue better that they were asylum seekers, but obviously the people who are coming to Australia by boat, they want permanent residency; that's what they want and this government has given the people smugglers a business model by putting permanent residency on the table. And even though the Government has adopted just one of the Howard Government's successful policies, it won't adopt temporary protection visas or the willingness to turn boats around where it's safe to do so.

LEIGH SALES: Do you think that the nature of politics allows politicians to be a little bit free with the facts in their statements just as part of the game of politics?

TONY ABBOTT: I certainly think that we had an example today in the Parliament of the Prime Minister caught out misleading the Parliament, but typically of this prime minister she just tries to brazen her way through it by refusing to answer the question. She said ...

LEIGH SALES: But how about - speaking of answering the question, how about you? I mean, what do you think? Are you absolutely scrupulous about making sure what you say in public is accurate?

TONY ABBOTT: Of course I am. What we had in the Parliament today was the Prime Minister clearly caught out. She said in the Parliament last year that it had been the industrial registrar who'd called her office about the Health Services Union and the Craig Thomson matter. It was exposed in the report that we got yesterday that in fact her office had called the industrial registrar. Now, in terms of this prime minister's looseness with the truth, maybe not her worst offence, maybe nothing to rank up there with, "There will be no carbon tax under the government I lead," but certainly yet another example of a prime minister who is seriously ethically challenged.

LEIGH SALES: But on questions of being loose with the truth, I've run you through three examples there on BHP, on the carbon tax and on asylum seeker boats where people would say you've been a bit loose with the truth.

TONY ABBOTT: And I've given you answers to demonstrate that what I've said is entirely justifiable.

LEIGH SALES: When we scratch beneath Tony Abbott's criticism of the Government, what's there? Is there an industrial relations policy, for example? Are you going to tell us if you're going to do what businesses want in terms of introducing flexibility into the workplace?

TONY ABBOTT: Well, I've told you that we will certainly address the flexibility problem, the militancy problem, the productivity problem and we'll do so in good time before the next election, Leigh.

LEIGH SALES: Well when exactly because business, I'm sure, would like certainty. You spoke about BHP being worried about uncertainty earlier.

TONY ABBOTT: And I'm offering them the certainty of the abolition of the carbon tax, the certainty of the abolition of the mining tax. I want to see an end to sovereign risk questions over Australia.

LEIGH SALES: You've said that it's in the public interest for Julia Gillard to answer some questions regarding her history with Slater & Gordon. What are the questions she needs to answer?

TONY ABBOTT: Look, these are questions that have been put to her by The Australian, which has run I think a very proper investigative analysis of her period with Slater & Gordon.

LEIGH SALES: And what are those questions? What are the questions?

TONY ABBOTT: But look, this isn't the main game for us. The main game for us are the cost of living pressures that this government has inflicted on the Australian public. It's not really ...

LEIGH SALES: Well sure, but a string of your - I'm sorry to interrupt, but a string of your frontbench have come out on this Slater & Gordon issue so I'm just wondering what are the questions that you want answered?

TONY ABBOTT: Well, the issue here is not whether she was an unethical lawyer. The issue surely is she is an unethical prime minister. And that's the main game for us, Leigh.

LEIGH SALES: No, but your - members of your frontbench keep saying she should give a statement to the Parliament. You said you would assist her to do that because you thought it was in the public interest. What are the questions you want to hear her answer in the Parliament?

TONY ABBOTT: And the point I'm making is that various reputable media bodies have put questions to her. I think the ...

LEIGH SALES: I'm just asking what those questions are.

TONY ABBOTT: I think the circumstances of her departure from a previous employer are of public interest, but in the end it's not whether she was an unethical lawyer that matters, it's the fact that this is an untrustworthy prime minister that counts, and that's the main game for us.

LEIGH SALES: But if you can't put to me - if you can't put to me specific questions that you want answered, then why are members of your frontbench running with it as an issue?

TONY ABBOTT: Well, look, don't forget it was Robert McClelland, Leigh, who first raised this recently.

LEIGH SALES: Sure, but you've run with it.

TONY ABBOTT: It was then raised again by Andrew Wilkie in the Parliament just a couple of days ago. Bill Shorten himself, in a sense, dumped the Prime Minister in it when he said that in recent times he was confident that the AWU had been legitimately and ethically run.

LEIGH SALES: Tony Abbott, there's always lots of things to ask you, but I'm afraid we're out of time. Thank you very much for making time to speak to us.

TONY ABBOTT: Thank you.