KIERAN GILBERT:
Let's bring in Andrew Leigh, he is the Assistant Minister for Competition, Charities and Treasury. A huge day for many families, those with mortgages, likely a few hundred dollars a month for many.
DR ANDREW LEIGH:
It's a big challenge, Kieran. And we know that the independent Reserve Bank is making its decisions to try and curb inflation, because if inflation gets out of control, that's an even worse hit to the economy and to people's living standards. But the government is aware of the cost‑of‑living pressures facing families, which is why in last week's budget, Jim Chalmers focused on the supply side measures. Cheaper child care, expanding the housing supply, cheaper medicines, fee free TAFE places.
GILBERT:
For many, it's not going to be applicable, isn't it? I know the government is talking up the efforts and cost of living, but for so many, it's irrelevant to them. Those areas you refer to…
LEIGH:
Well, we've got cheaper medicines as well. If you're buying an electric vehicle, we're taking the taxes down. We're working to unlock the supply side pressures. But what we didn't do last week, Kieran, was an unfunded cash splash that would have just made the Reserve Bank's job harder. They're trying to curb demand. We're trying to unlock the supply side. We need to be working together because if you've got fiscal and monetary policy at cross purposes, Australians suffer.
GILBERT:
Indeed. But that's the dilemma here, because people are already suffering. You look at these energy prices, they're going to suffer even more, according to those forecasts in the budget.
LEIGH:
And one of the challenges is we've had a decade of investment strike in renewables, partly due to the policies of the people who are now the Leader of the Opposition and the Shadow Treasurer. If you look at places which have more renewables in the system, they're less dependent on the international energy market. Take this jurisdiction, the ACT where we're having this conversation. In the middle of this year, the independent regulator announced a 1.25% decrease in ACT electricity prices because the ACT is 100% renewable and simply isn't affected by those international movements on gas prices when it comes to electricity bills.
GILBERT:
Would you say, though, that's the argument from the Opposition Leader, among others, that there's not the scale in terms of the technology when it comes to storage and so on right now to enable a full transition to happen immediately.
LEIGH:
We're seeing big improvements in technology and we're seeing big potential in areas such as offshore wind, joining up the grid, the Rewiring the Nation plan, which has seen investments in projects such as Marinus Link and also the continually falling prices of solar and wind. We need to make this transition because once you've got those renewables in place, there's zero marginal cost, so that's a huge benefit for households and for industry. I do believe Australia can be a renewable energy superpower, but only with a set of policies that make it very clear that we are committed as a nation to the investment in upgrading the electricity grid.
GILBERT:
You're the Assistant Minister for Competition as well. Is competition not working right now among energy companies?
LEIGH:
We've got big challenges in the gas market, and certainly Chris Bowen and his state and territory counterparts are working on that right now. All options are on the table. We've got to make sure that Australian households and businesses are looked after. I've been concerned that we've seen this doubling of gas prices, and that is having a significant adverse impact on Australian households.
GILBERT:
Would something like a price cap carry with it risks in relation to sovereign risk?
LEIGH:
I don't think there's any perfect solution. But as Madeleine King, Chris Bowen, Jim Chalmers have said, all the options are on the table. And we are laser focused on ensuring that Australian households and businesses are looked after through this challenging period.
GILBERT:
You said it's not easy and there's no easy option here, but can the government put some downward pressure on those energy prices?
LEIGH:
Look I believe we can, and Chris Bowen is actively engaged leading this effort.
GILBERT:
I know you said that you wouldn't want to have a cash splash right now, and anyone that has watched the events in the United Kingdom would understand why. But is it in the government's thinking, is it on your radar to look at some sort of rebate down the track for families that are coping it right now, both in terms of rates but in terms of energy prices, too?
LEIGH:
Our main focus, Kieran, is on the supply side. I think that's what government can do best, and that gives you the long term productivity uptick. So when we invest in better transport networks or better educational systems, we lay the foundation for better productivity growth. One of the reasons we've had such lousy growth in living standards is because we've had lousy growth in productivity over the last decade. So I'm very keen that we don’t just act for the short term, but also in the long term interest of the nation.
GILBERT:
It really is a race, though, isn't it, in terms of that? You spoke about the Marinus Link, the Rewiring the Nation, offshore wind this is 100% a race now for the government to try and deliver what you've said. Because if it's right, if the Prime Minister is right, and you're right and renewables are the cheapest option, then you've got to get it out there in appropriate scale to start putting that downward pressure on prices.
LEIGH:
Yeah, I think you put it really nicely, Kieran. We've had this decade of climate wars led by the Coalition fighting between Liberals and Nationals. Twenty‑two failed energy policies, and that's meant that Australia hasn't been investing in renewables at the pace of other advanced countries. We need to catch up because not only do we need to make that effort on climate change, but moving to four‑fifths renewables by 2030 will deliver cheaper energy prices for Australian consumers and businesses.
GILBERT:
On a couple of other matters, industrial relations has seen the Chief Executive of the Resources and Energy Employer Association, Steve Knot, he says there's white hot anger in the industry. And he had this warning as well, he says that the broader employer community will be energised to run an anti IR bill that will dwarf the unions’ Your Rights at Work campaign. Quite a threat from the resources sector. What do you make of that?
LEIGH:
We were elected to get real wages going, to provide workers more flexibility and to close the gender pay gap. We now have real wages that are lower than they were a decade ago. Shocking statistic.
GILBERT:
Are you worried about that sort of rhetoric, though, from the resources sector? If they were to put tip millions of dollars into an ad campaign?
LEIGH:
I'm worried about Australian households and the stagnant, indeed falling real wages that they've had to undergo. We've just been talking about the pressures on households. One of the ways of ensuring that we take those pressures off is to get real wages going again. It comes up all the time when I'm speaking to my constituents. That challenge that there always seems to be more month then money. That's why we pushed so strongly for the increase in the minimum wage. The first cabinet decision of the Albanese Government. Just $1 increase per hour for the minimum wage workers and yet the Coalition couldn't back it in.
GILBRT:
Should the government at the very least delay the timeline here? The government wants the legislation through before, well, I think in the next couple of weeks, only giving it a few weeks consideration. You've got David Pocock, Jacqui Lambie, among others, saying they want to have a closer look. Should the government allow more time for consideration of this complex legislation?
LEIGH:
We'll have those positive and constructive conversations with crossbenchers. But Kieran, Australian workers have been waiting a long time for a pay rise that outpaces inflation. Australian women have been waiting a long time to see serious efforts in closing the gender pay gap. These are urgent challenges for Australian households. We won a mandate at the last election for them and we’re keen to implement them.
GILBERT:
The ACCC finally has welcomed these new unfair contract terms laws that were introduced last week. Who is this addressing, or more to the point, protecting? That legislation?
LEIGH:
Protecting small businesses that are having to deal with standard form contracts with utterly unfair terms in them, terms that, for example, let the big counterparty cancel the contract unilaterally or change prices unilaterally. They're unenforceable at the moment, but they're not illegal. And making them illegal has been broadly welcomed by the small business community and by people who want to see that dose of economic dynamism in the Australian economy that will help get productivity going again.
GILBERT:
And that comes from the smaller business, in your view?
LEIGH:
Absolutely. We need to get more startups in Australia in the face of an economy which is increasingly concentrating and where markups are growing. So it's important for cost of living and it's important for growth.
GILBERT:
Assistant Minister for Competition, Charities and Treasury Andrew Leigh, thanks for your time.
LEIGH:
Thank you, Kieran.