Stephanie Borys:
Andrew Leigh is the Assistant Minister for Productivity, Competition Charities and Treasury, and he joins me now. Andrew, thank you for your time this afternoon. Is there more the government can do to ensure there’s no restriction to fuel in the regions?
Andrew Leigh:
We’ve already done a lot Stephanie. Since we came into office, we’ve ensured that our fuel reserve is kept onshore or within our Exclusive Economic Zone. Under the Coalition, you had Australia’s fuel reserve being kept in Texas and Louisiana. Now it’s in Brisbane and Geelong. We’ve also put in place minimum stockholding obligations on large fuel users and we’ve also overseen a significant electrification of the vehicle grid which ensures that there are fewer motorists who are putting demands on the fuel supply.
I understand there’s a lot of pressure on at the moment. The Treasurer has written to the competition watchdog to keep a close eye on any price gouging at the bowser and we are working constructively with the industry, as you heard before from Minister Bowen.
Borys:
So when did he write to the competition watchdog – the Treasurer?
Leigh:
So, that was last week in order to ask them to – in addition to their usual fuel monitoring program – to pay particular attention to any price gouging that’s going on at a time where the prices are rising. This is a significant challenge. But Australia is better placed to meet this challenge than we have been at any other time in the last 15 years – both in terms of the fuel stocks that are in place, but also the decreased pressure that we have for fossil fuels in the grid.
The electricity usage over summer 2022 was almost twice what we saw drawing from gas than in the most recent summer. So we’re demanding less gas for our energy usage, we’re demanding less fuel as a result of the electrification of the vehicle fleet and we’ve done much better than the Coalition did in terms of the size of the fuel reserves and keeping them onshore.
Borys:
Now, oil prices have passed $100 a barrel US for the first time since 2022. What does that mean for motorists here? What are they going to see change?
Leigh:
Well, it’s certainly going to cause price pressures. There’s no denying that every time you see this sort of price increase in terms of the barrel price that translates into the prices of the pump. Fuel margins are significantly lower than margins for a range of other goods and so that input cost price is significant. This isn’t though, a time for people to feel the need to stockpile. There is plenty of fuel out there. It’s important that we don’t see people stocking up. There’s not a need to do that at this stage.
Borys:
The consequences of this though, do you believe, for our economy, is it going to be short or long‑term? I mean, or can you even say which way at the moment, given the uncertainty of this war?
Leigh:
Yeah. I mean, it’s inherently about geopolitics Stephanie as you know. And the duration of this war is one of those things that has got analysts scratching their heads. It’s not clear how long the US and Israel intend this conflict to last. And of course, the duration of the conflict will be determined in part by the Iranian response. We’re seeing Iran striking non‑combatant countries, which Australia, along with many other countries around the world, has condemned. We have urged all parties to bring this to a peaceful resolution.
We have the issues of affecting fuel in Australia, affecting residents in the region; the more than 100,000 Australians in the Middle East and of course, so many Australian travellers who use the Middle East as a hub to get to Europe.
Borys:
Now, I appreciate a lot of the problems that we’re seeing flow on to countries, including Australia are a result of the war overseas. That said, Reserve Bank Governor Michele Bullock says the conflict in the Middle East – yes, that could lead to higher interest rates but also that persistent inflation here remains a problem. So what can the government do? Do you need to look at cutting back spending ahead of the May Budget?
Leigh:
Well if you look at the latest GDP figures, it’s very clear that the majority of the expenditure pressures are coming through the private sector rather than the public sector. And indeed, as the energy bill rebates and the like have come off, that’s taking some government pressure out. We’ve delivered 2 budget surpluses and also made more than $100 billion of savings as we’ve looked to assist with the inflation work. If you look at the press conferences of the Reserve Bank Governor – she recognises that the government and the Reserve Bank are working as one at this challenge. Obviously, they have different levers than we do and we don’t step into their patch when it comes to determining the appropriate path of monetary policy.
Borys:
Just leaving finance for a bit now, and I want to talk about politics in terms of different parties that we have here in Canberra. Your colleague Dan Repacholi – he sent an email to Labor supporters saying One Nation is a clear and present danger to the political landscape, and he’s asking for donations to the Labor cause. Why are you using One Nation as a way to drum up support for the Labor Party?
Leigh:
I think One Nation has always been an extremely divisive force in Australia. They’ve sought to try and marginalise and demonise minorities, they’ve sought to try and sow discord in the community. One Nation consistently has been a force for division rather than unity. That’s not the Australian way. I think Australians love teamwork. We value seeing it on the sporting field, in the business context and in the economy. And the One Nation approach of looking for people who are down and looking to kick them a bit harder isn’t the Australian egalitarian way of looking to lift everyone up. So ever since One Nation has emerged as a political force in Australia, I’ve seen it as being a damaging force and one which we need to make strong arguments against.
A proud nationalist should be proud of Australia’s multicultural identity because that’s interwoven in who we are. If you’re not proud of the rich tapestry of countries that make up modern Australia, then you’re not really proud of Australia, are you?
Borys:
Andrew Leigh, thank you for your time this afternoon on ABC Afternoon Briefing. We’ll have to leave it there.
Leigh:
Thanks so much.