CHRIS SMITH:
The Treasurer is on the line. Morning to you, Josh.
JOSH FRYDENBERG:
Nice to be with you, Chris.
CHRIS SMITH:
Good to have you with us. Footnote, I want to talk about Palaszczuk in a second and I want to talk about what's going in Melbourne, but we've lost a real character overnight, the former Federal President of the Liberal Party, John Elliott, and someone who you knew so well through not only business and the Liberal Party but through the Carlton Football Club.
JOSH FRYDENBERG:
Well Chris, he was a larrikin, he was a larger-than-life figure, and he will be greatly missed. He left a huge impact on the political world, the corporate world, the sporting world. You know, you'd often picture him down at the footy club rooms, you know, with a cigarette in one hand and a Foster's in the other and singing the theme song after another Carlton win. You know, he was very proud of the jumper and some of the changes he made down at the club led to some, you know, really good times and premierships. I had the privilege to know him. His son Tom is a broadcaster here in Melbourne and I remember being interviewed by the two of them in the lead‑up to the last election. There was a lot of good, fun banter, we shared some passions.
CHRIS SMITH:
I bet there was. Did he ever say pig's A-R-S-E or was that just the satire that we saw on Fast Forward?
JOSH FRYDENBERG:
I think he denied that he actually said that, but they certainly had fun with that. The thing is you could imagine him saying it, that's the point, right. You know, there was a bit of circumstantial evidence there which probably got him out. But, you know, he was a jovial guy and, you know, sure, there were some people who had different views of him, but you never were in doubt about what he thought and where he sat, and I think that says a lot about his character.
CHRIS SMITH:
We need more characters like that. Alright. Net‑zero emissions. You're not forming an alliance with Adam Bandt and the Greens, are you?
JOSH FRYDENBERG:
Far from it, far from it. What this speech is about is to inform Australians about the changes that are happening in financial markets. You see, Chris, whether it was the industrial revolution, whether it was the digital age, financial markets have adjusted and been impacted by those significant structural shifts. Now climate is like that in the sense that investors are reassessing what they consider to be risk and reassessing what they consider to be good value. This matters to Australia because we rely so heavily on foreign investment. There's around $4 trillion of foreign investment in Australia. About half of our government bonds are bought by foreign investors and around a fifth of the lending and the borrowing of the banks is actually financed from offshore and that's for everything from household mortgages to small business loans. So we don't want to be on the wrong side of this. We don't want to be disadvantaged by this movement in financial markets and that's why it's really important to have the right regulatory frameworks in place so investors can make timely and informed decisions, that's why it's important to be part of global agreements so we're not penalised. You know, the impacts can be quite real, and I just want to make sure that Australia's on the front foot here.
CHRIS SMITH:
You're not succumbing to the climate bully boys on financial boards around the world, are you?
JOSH FRYDENBERG:
No, and one thing that you'll see in the speech today is a very strong message to investors, whether they're superannuation funds, whether they're banks, whether they're insurers, that they need to invest in traditional industries like agricultural, like resources, like manufacturing, because you can't just invest in green assets or you can't blacklist what are called brown assets. You've got to invest right across the board, and until you do that you won't actually get the real movement in the emissions reduction you're seeking to do. Great Australian companies like BHP, Chris, that have been around more than a century and are looking not just to be there in 2050 but to be there bigger and stronger well beyond, you know, they're starting to power mines with renewables. You'd have Fortescue's investing in hydrogen. So some of the most cutting edge and innovative technologies are taking place in traditional Australian sectors like agriculture. I mean you know about soil carbon and the real benefits that can be obtained there…
CHRIS SMITH:
Yeah.
JOSH FRYDENBERG:
I think there's real opportunities here for our agricultural sector, for our mining sector, which are both world‑best sectors.
CHRIS SMITH:
But no carbon tax?
JOSH FRYDENBERG:
To get on top of this.
CHRIS SMITH:
No carbon tax?
JOSH FRYDENBERG:
No tax. Technology not taxes.
CHRIS SMITH:
Okay. So we are going to commit to net‑zero emissions by 2050 at this climate summit in November, are we?
JOSH FRYDENBERG:
Well Chris, we haven't taken any formal decisions. We're making progress on the internal discussions and, you know, that is the way to do it.
CHRIS SMITH:
But is this what you want to see? Is this what you're saying today you want to see?
JOSH FRYDENBERG:
Well I'm being very clear that Australia needs to be part of these international agreements and we can't allow a false assumption or a false conclusion to be drawn by international investors about what Australia is doing. I'll give you a perfect example, Chris. We've actually reduced our emissions by more than 20 per cent since 2005. That's double the OECD average.
CHRIS SMITH:
Yep.
JOSH FRYDENBERG:
That's faster than New Zealand, Canada, you know, US.
CHRIS SMITH:
Which is why we don't need to be lectured to by the world.
JOSH FRYDENBERG:
Exactly right. Exactly right. I mean China's a big source of emissions and New Zealand talks about their carbon footprint being reduced but they've barely moved the dial since 2005, whereas we're down by more than 20 per cent, so we are walking the talk.
CHRIS SMITH:
Okay. Quickly on subs. I saw Penny Wong yesterday talk about, "Oh, do we have sovereignty over our nuclear-powered subs", in other words can we do what we want with them, can we use them where we want, et cetera, all that sort of stuff. Is the Labor Party putting a little bit of doubt into the public's minds about if they get into power at the next election whether they'll keep to this pact?
JOSH FRYDENBERG:
I think they are. I think they're having a bet each way. We make no apologies for strongly defending the national interests and making decisions that advance that national interest. But, you know, when it comes to national security, Chris, you don't equivocate, you don't have a bet each way.
CHRIS SMITH:
No.
JOSH FRYDENBERG:
What we have sought to do is build a strategic partnership to access the best technology with two of our strongest allies, namely the United States and the United Kingdom. The Labor Party's fluffing around fighting each other. I saw Peter Khalil, you know, a Labor back bencher, have a whack at Paul Keating saying he's wrong about this reducing our sovereignty, he's wrong about the geostrategic realities that we face.
CHRIS SMITH:
But the Left faction of the Labor Party hate anything related to nuclear, we all know that.
JOSH FRYDENBERG:
And they're divided. They're divided. They never would have taken this decision. They never would have been able to get unity on their Left and their Right flanks to take this decision. I want to point out to your listeners that what this deal does is that it gets Australia access to the best technology, and that's what we want. AUKUS is broader than just the nuclear subs. It's around cyber, it's around artificial intelligence.
CHRIS SMITH:
Yeah.
JOSH FRYDENBERG:
It's around a whole lot of areas. And other countries in our region, Japan, Singapore, India, Korea, they also want to be close to the United States. So it's a fallacy to think that, you know, one side is the US, and the other side is Asia. It's actually a fallacy. The countries in Asia want to be closer to the United States and Australia wants to be closer to the United States.
CHRIS SMITH:
Two quick things. Is it true that you were asked by the Victorian Treasurer to help foot the cost of putting their construction industry on hold, and is it true that you told the Treasurer to go and jump?
JOSH FRYDENBERG:
Well in different language to that but, you know, you're on the right track there.
CHRIS SMITH:
How dare they have their hand out when they were the ones who shut the industry down.
JOSH FRYDENBERG:
Well, Chris, I call it chutzpah, I don't know if you're familiar with that term. For your listeners it's otherwise known as cheek.
CHRIS SMITH:
Yeah.
JOSH FRYDENBERG:
A bit of cheek. Because these are the facts, right. We are putting into Victoria as a Federal Government around twice what the State Government is in terms of households and business support. Twice. We're picking up the bill for the whole COVID disaster payment, $2 billion out the door. Construction workers can get that $750 a week right now. The New South Wales Government put construction businesses in their plan, but the Victorian Government chose not to put it in their plan that we reached with them. Now, in New South Wales they made some decisions to top some of the Federal Government funding. That's an opportunity and an option that's available to the Victorian Government to do. I'll leave it to them. But I'm not going to take their bait and get into a fight with them because that's just the distraction that the Victorian Government wants.
CHRIS SMITH:
Okay. One last one, Annastacia Palaszczuk is now saying she may not agree to re‑open her border when Australia reaches 80 per cent fully vaccinated. Can you tell her to go and jump too?
JOSH FRYDENBERG:
Well that would be a bad decision. It will cost Queensland jobs. It will divide Queensland families. It's inconsistent with the national plan agreed at National Cabinet, and it's denying and delaying the inevitability. That inevitability, Chris, is living with the virus. We can't be any clearer. You turn on your TV, in the United States and the United Kingdom and in Canada, there are thousands of cases every day, but they're living with the virus. They're getting on with their lives. My message to Annastacia Palaszczuk, and indeed all the other premiers, is you need to learn to live with the virus and that is really important for Australians to get their lives back in a COVID‑safe way.
CHRIS SMITH:
Your tip for the AFL Grand Final?
JOSH FRYDENBERG:
Go Dees.
CHRIS SMITH:
Okay.
JOSH FRYDENBERG:
Last time was 1964, you know, the players, Chris, back then were having a cigarette at half‑time, I mean, you know, 1964, the Beatles were touring, you know.
CHRIS SMITH:
It's well over time.
JOSH FRYDENBERG:
It was, you know, a pie and a beer were 20 cents at the club. Back in those days the players all had full‑time jobs.
CHRIS SMITH:
Yeah.
JOSH FRYDENBERG:
These days it's a very different, much more professional league. I think the Dees are deserving of a win on Saturday night.
CHRIS SMITH:
All right. Enjoy it and enjoy your weekend. Thank you for your time.