Jaynie Seal:
But for more, joining us live is Assistant Treasurer Daniel Mulino. Daniel, is it going to be a rate cut, do you think?
Daniel Mulino:
Oh, thanks for having me on, Jaynie. And look, given that it’s Melbourne Cup Day, there’ll be a bunch of racing experts speculating on who’s going to win the race. And as we’ve just seen, there’s a lot of economists speculating on what’s going to happen at 2:30 pm. So, look, I don’t get into the speculation about what the RBA will or won’t do, but what I would say is that inflation at the moment is around half what it was when we came to office. It was, it had a 6 in front of it and was rising fast. And also, I’d say if you look at the most recent trends, underlying or core inflation has been at 3 per cent or lower for the last three-quarters. But look, the RBA will weigh up a whole bunch of factors when it makes its decision at 2:30, and that’s really up to them as an independent central bank.
Seal:
Yeah, well, the odds aren’t looking great for a drop, but as you said, we will know soon. I guess the big question is for mortgage holders and the pressure on them, because other experts are predicting that we might not even see a rate drop until mid‑next year.
Mulino:
Yeah, and look, I think the fact that we know that there are people in the community doing it tough, that’s why we’re continuing to roll out a whole range of cost‑of‑living supports, whether it be cheaper medicine, whether it be energy bill rebates and for those who are renting, Commonwealth Rent Assistance. And of course, we also have tax cuts coming through for all Australian taxpayers, successive rounds of tax cuts. So, look, we’re conscious that there are still people doing it tough, and that’s why we have a whole raft of cost‑of‑living measures.
Seal:
And we are talking about one today, the households being able to receive 3 hours of free power, with Labor announcing that new electricity scheme. But, Daniel, some Nationals are really saying that the plan is going to increase power prices even further. Would you agree with that?
Mulino:
No, no, I wouldn’t agree with that. Look, I think what this does is it sensibly reflects what is happening in wholesale markets, where we’ve seen, because of the very successful rollout of solar panels over a long period of time, we’ve seen wholesale prices drop to very low levels, often zero, during the course of the day. And what we want to see is electricity consumption smooth out as much as possible over the course of the day.
This, of course, takes pressure off network prices to the extent that, for a given level of consumption, we can smooth it out over the day, we can reduce the peakiness of consumption. That means we need less network capacity. So, we’ve done this quite a while ago with incentives for off‑peak hot water, for example, going back decades. And now what we’re seeing is, as a sensible measure in the market to encourage people to shift usage, whether it be air conditioning or pool cleaners or whatever it might be, if houses can, through the use of their time‑of‑use meters, shift usage into periods in the middle of the day when there is low usage of the network, that’s going to be better for everybody in the market.
Seal:
The Coalition, as we know, they’re looking at their net zero plans. The Nationals are dumping net zero. We’re waiting to see what the Liberals are going to do, but nuclear energy has been a big talking point for them. If we look at it from an economical point, and we know that leading up into the federal election in May, they wanted to have a number of coal‑fired power plants. But some of the narrative there at the moment from the Coalition is about just lifting the moratorium and having a sensible conversation, and even potentially just exporting uranium that would provide the country $1 billion a year, for example, for WA alone. The government, your government, just doesn’t seem to want to budge on anything like that, to have an agnostic look at energy like nuclear or even have the conversation.
Mulino:
So, Jaynie, look, I just want to go back to the core of this issue. I was on the Select Committee that examined nuclear late in the previous term, and we travelled right around the country. We also heard from experts here in Australia and experts internationally. It was an incredibly productive committee. But what we found is that energy from large‑scale nuclear plants is very expensive. But secondly, the delay that it would involve in terms of getting energy into the grid is really not possible to accommodate with Australia getting to net zero by 2050.
We heard from experts that it’s going to take a significant amount of time to get any kind of regulatory arrangements in place. And then when we looked at the time it’s taken to get energy from nuclear plants, nuclear plants up and running in comparable economies like the UK and the US, both time and cost blew out massively. So, we’re looking at 15 to 20 years or more following a decision before we get any energy.
So, my concern with exploring this is that it’s really kicking the can down the road, and really, it’s an excuse for delay. And the fact that the Opposition themselves admitted that it would have to be all on the government balance sheet, hundreds of billions of dollars on the government balance sheet, really reflected, in their own policy parameters, the fact that the private sector has no appetite for this whatsoever, which tells us everything.
Seal:
But the private sector can’t really have a conversation about it until the moratorium is lifted, correct me if I’m wrong. But also, people like Tony Wood from the Grattan Institute has come on Sky News a couple of times and said we should at least lift the moratorium and have that conversation. And speaking to lawyers in the nuclear industry, they’ve told me that they can lift that moratorium in WA, for example, basically in a day.
Mulino:
But look, I guess what I would go back to is the fact that the Opposition, in their own policy, had the government wearing all the capital costs. So, hundreds of billions of dollars on the government balance sheet, which would have been a huge burden on taxpayers, which would have had a huge impact on energy prices.
So, that’s really the Coalition themselves acknowledging that, whether there’s a moratorium or not, that nuclear energy is going to require the government wearing that cost. And so, I just think what we need to be doing is putting in place incentives for investment, which is what this government is doing with legislating for net zero, legislating for medium‑term targets, having a range of other policies that incentivise abatement throughout the economy in a least‑cost way. That’s what we need, and that’s what business wants. They want certainty so that they can make investments.
Seal:
Yeah.
Mulino:
That, with the Opposition now going back to deciding whether or not we need to take action at all, it’s actually very damaging for Australia’s ability to go down a sensible trajectory.
Seal:
Yeah. We’ve got to wrap it up, but I guess the other question–we’ve got to go, but you know, with nuclear energy, it’s next to no emissions. So, we’ve got to ask the question: are people concerned about the planet and significantly lowering our emissions, which we could do if we lifted the moratorium and at least exported uranium to other countries? Daniel Mulino, thank you so much for joining us.