MICHAEL ROWLAND:
Good morning, Treasurer.
TREASURER:
Good morning, Michael.
ROWLAND:
Now, some of the Labor states have said that they are not going to play ball on this. The Queensland Government says your plan will hamper its transition to renewable energy. South Australia's Premier Jay Weatherill calls it is nothing more than a big coal subsidy. Are you facing an uphill battle to get those key states on side?
TREASURER:
Well, I'm disappointed about them playing politics early. But the Energy Security Board was set up as a recommendation of the Finkel Report. It was actually set up by COAG, by the very premiers you've spoken of. It comprises people that were welcomed right across the board, people like John Pierce, Kerry Schott, people who have been around this space for a long time, people who have worked for governments of both persuasions, have no agenda – just having lower energy prices, more reliable energy and meeting our environmental obligations. That's the recommendation they've come forward with out of this process and we're adopting that and taking it forward to COAG and it has many virtues, particularly in terms of both meeting our obligations on the environment, but equally putting that downward pressure on prices and resulting in lower prices by stripping out the subsidies and ensuring that we have the investment certainty that has been welcomed by the Business Council, the Australian Industry Group with Innes Willox and of course the Australian Chamber of Commerce and Industry. As Tony Wood has said in the Fin Review today, from the Grattan Institute, this is something that is actually delivering across the board, so I'm looking forward to having further discussions with the states where they can maybe get over the initial politics and start focusing on the merits of what is a very good proposal.
ROWLAND:
Some states, including Queensland, Treasurer, even threatening to go it alone. What does that do to this national energy plan?
TREASURER:
Well, that would be no good for Queensland. That would be against the interests of Queenslanders We need a national energy policy which provides certainty right across the country and what I don't understand is why they would want Queenslanders to pay more for their energy. I can only assume from that, that the Queensland Premier Annastacia Palaszczuk wants to have higher subsidies for renewable energy in Queensland which Queenslanders would have to pay for. What this whole process has shown is that those subsidies have been pushing up the prices. You take those subsidies out, well, naturally, the prices are lower.
ROWLAND:
Let's go to the suggested cut of up to $115 per year per household if this national plan comes into full swing. Can you understand people's scepticism though, Treasurer, because you haven't released the modelling behind these figures?
TREASURER:
Well, we've released the letter which was provided by the Energy Security Board who provided that advice as to what that impact is. And I stress this is one of a whole series of things the government is doing. This is not the only thing the government is doing on energy. What we have already done on gas which has brought the wholesale gas price down, what we have done on working with the energy retailers – people are already getting in contact with their energy companies and getting pretty substantial discounts, up to 20 per cent. So this is not the only thing that has been done. The ACCC has already commended us for what we’ve done on regulation, like getting rid of the free kick for the poles and wires companies who gold plate their infrastructure and pass the cost on to you. Now we got rid of that too. So, there are a whole range of things. We got the advice on $115 from John Pierce, and I'm a bit disappointed that the Labor party has basically been sledging John Pierce, sledging Kerry Schott and Audrey Zibelman from AEMO. This has been a very bullying approach to these very distinguished advisers and maybe if they could stop sledging them for a while and start listening to them then they might actually see that this is a great opportunity for people who live in their states.
ROWLAND:
The Labor party and some others simply want the figures. Will you release the modelling?
TREASURER:
Well, they will get everything.
ROWLAND:
When?
TREASURER:
They will get that as the figures are provided and developed additionally by John Pierce and the rest of the team. There was a briefing last night with the Labor party here and they got everything that the Government has, and they will continue to get this advice as we go forward. But with Alan Finkel having backed this in yesterday Labor doesn't have a feather to fly with anymore. The only thing standing in the way of having genuine national investment certainty, a scheme which delivers on reliability, delivers on our environmental commitments and delivers on affordability is the political vanity of the Labor party.
ROWLAND:
Now, you might recall Amanda Vanstone, one of your former colleagues, got into trouble some years ago for criticising a Howard Government tax cut that equated to $5 a week, saying it would buy you nothing more than a milkshake and a sandwich. $100 a year translates to about $2 a week. How will that affect anybody at a time when all of us are facing these staggeringly high power bills?
TREASURER:
I answered that question before. This is not the only thing the Government is doing. What this is doing is delivering certainty for investment to increase supply which puts downward pressure on prices as Kerry Schott said. In addition to that, we've got the initiatives on gas, to secure gas for Australian domestic demand, the work we've done with the retailers, the work we've done on reforming the regulation. All of this means that people are getting discounts now that they wouldn't have got a year ago, two years ago, because of the work the Government is doing. On top of that, it’s always a relative choice. People could always [inaudible] what the Labor party is saying which has a 45 per cent emissions reduction target and which would require $66 billion worth of subsidies that you don't need to pay to meet our environmental obligations that we've set out at 26 per cent, and so I think there is a great light that has been shone on this. Australians have a clear choice: they can pay more for electricity under Bill Shorten’s electricity bill of $66 billion in subsidies or they can have lower prices under Malcolm Turnbull and the investment certainty that goes with it, that meets our environmental obligations. It’s a clear choice.
ROWLAND:
Another way of cutting people’s power bills is to tackle this effective oligopoly in energy retailing sector – one of the issues sighted by the ACCC in its report at the start of the week. A lack of competition cited as one of the big increases as to why those power bills have gone up by such a large amount over 10 years. What is the Government doing about that, to break that market concentration?
TREASURER:
Well, there is further work to be done on that and remember the inquiries that I commissioned of Rod Sims were in two areas, they were into electricity prices and they were also into gas and they've released the draft report, there is still a full report to come, and they are the issues that have been further flagged by Rod when he gave that report to me in the last few weeks. I should also stress, those reports which prised open the books of both the gas companies and of the electricity retailers, have been absolutely pivotal to assisting the Energy Security Board being able to have the information they really needed to be able to drive the outcomes and recommendations that they have come up with. So, we have done things that have informed the process that means we have got better evidence-based policy, and the evidence-based policy is the National Energy Guarantee means lower prices, more reliable energy, and we meet our obligations to the environment. I mean, why wouldn't you want that, Bill Shorten?
ROWLAND:
We'll leave it there. Treasurer Scott Morrison, thank you very much for joining News Breakfast.
TREASURER:
Thanks a lot, Michael.