PATRICIA KARVELAS:
I'm joined by Josh Frydenberg now from Queensland.
Josh Frydenberg welcome.
JOSH FRYDENBERG:
Nice to be with you Patricia.
PATRICIA KARVELAS:
We'll get to economic matters shortly. But first, Angus Taylor says you were aware of his stake in Jam Land when you asked environment department officials to meet with him during an investigation into the illegal spraying of protected grass by that company. When did you become aware?
JOSH FRYDENBERG:
I became aware when he asked me for a meeting. He was very up-front. And he said that there was a family company which was subject to a compliance issue. And that he had an indirect interest in that company. But he was seeking a meeting on the technical aspects of the listing and in those circumstances, as is appropriate, would there be any discussion of the compliance issue. Now I note that in subsequent testimony from environment department officials, to a Senate hearing, they said that was absolutely appropriate for Angus Taylor to do that.
So, people have to understand, while the Labor Party will hyperventilate over this issue because they're increasingly desperate, Angus Taylor has made a comprehensive statement to the Parliament. And that Parliament makes it very clear that he complied with all his responsibilities appropriately on the declaration of interests and that when he sought the meeting, it was not to discuss the compliance issue.
We have seen from subsequent documents released under FOI and in testimony to parliamentary hearings by Department of Environment officials, that at no stage was the compliance matter discussed.
And the last thing I want to make very clear, Patricia, that the grasslands were elevated to critically endangered and they remain at that level. So nothing has changed with the listing process. And that's very, very important. This meeting that he sought and he was given, was about the technical aspects of the listing.
PATRICIA KARVELAS:
Did you think that an assistant minister meeting with the Department of Environment while it was investigating a company he had a financial stake in, might breach ministerial guidelines? Didn't it ring alarm bells for you?
JOSH FRYDENBERG:
The key component here was that the meeting itself was clearly only to be about the technical aspects of the listing. He has constituents and indeed farmers right across that region who have been concerned about the listing of those grasslands as critically endangered. And there's been confusion around the compliance with that law. So it is only relevant and only appropriate that in relation to the technical aspects of that listing, which the officials made very clear, that this was about, that he had that briefing. You would expect him to be advocating on behalf of constituents. Just as you would expect Labor members to do so.
PATRICIA KARVELAS:
But he was also advocating on behalf of himself. We know this because he said it in an ABC interview.
JOSH FRYDENBERG:
Well, there was no discussion whatsoever about the compliance aspect of that particular issue. What it was all about was the technical aspects of the listing. And as Angus has rightly pointed out in his comprehensive statement to the Parliament, this has been an issue of concern to farmers. We know the NFF, the National Farmers Federation, made a submission going back as early as 2014 on this very issue, and then there was a review in 2018 which said that farmers were still confused about this. So it's all about ensuring that your constituents have their voice heard, and it's surprising that the Labor Party and particularly the member for Eden-Monaro, has been silent on representing his constituents in relation to this issue.
PATRICIA KARVELAS:
Just before we get onto the economic issues, why did you inquire about whether it was possible to change the critically endangered classification of the grass that Angus Taylor's company was accused of poisoning?
JOSH FRYDENBERG:
Well as I said, the NFF had raised issues, colleagues had raised issues, and it was clearly of concern to farmers and it was important to understand the process. It was not - it was nothing more than that. And as I say, the grasslands were critically endangered, back when Greg Hunt was the minister, and they remain critically endangered today. At no stage was the briefing for Angus anything to do with the compliance matter that you raise.
PATRICIA KARVELAS:
Prime Minister Scott Morrison has backed the US continuing its trade war with China, until they get a comprehensive agreement, including concessions on intellectual property theft. How do you see that being in Australia's interests?
JOSH FRYDENBERG:
Well, I think it's really important that the United States and China, our two big trading partners and investors, get on and we're not subject to a sort of tit for tat tariff war. Because in the event of trade tensions between China and the US, it's not just the protagonists who are hurt, it's all bystanders as well. And Australia is really caught in the middle because the United States is our largest investor and China is our number one trading partner with more than $200 billion of two-way trade in the last year. So it's critically important that we use the World Trade Organisation, we use the good offices of countries like Australia to help generate an outcome between China and the US that will see a continuation of a rules-based open trading system.
PATRICIA KARVELAS:
The OECD has downgraded global growth to 2.9 per cent for 2019, largely due to the impact of these trade tensions. President Trump says the trade war could drag on for another year. What would the impact be on our economy if that happens?
JOSH FRYDENBERG:
There's no doubt its affecting investment confidence already. Capital flows and investment decisions are being deferred. And the growth in trade volumes has slowed quite significantly.
For Australia, with one in five jobs related to trade, it's really important that we have a rules-based trading system, where we can sell, as a country of 25 million people, our goods into much bigger markets in the region. We're very proud of the fact that since the Coalition came to government, we've turned a situation from having free trade agreements that covered just 26 percent of our two-way trading relationships to now having free trade agreements that cover more than 70 per cent of our two-way trading relationships, which will hit over 90 percent in the years ahead.
The big economies of China, Japan, Korea, the Trans-Pacific Partnership, which involves 11 nations and soon, hopefully, the Comprehensive Strategic Economic Partnership that we're doing with 16 nations. That's going to be really good for Australian businesses, both big and small, who are exporting and importing with the region.
PATRICIA KARVELAS:
China produces 80 per cent of the world's rare earths, are you worried about the future of that supply? I'm referring to the agreement here with the United States on rare earths.
JOSH FRYDENBERG:
Well this is an area where the United States and Australia can work closely together and indeed it was an important topic of conversation over in the United States between our respective leaders. And the reason is we want supply chains to be strengthened, we want supply chains to be reliable and we want them to be secure. Particularly when the rare earths you're talking about are so vital to commerce and technology. Australia has a strong position, as a home for a number of these rare earths. But we want to ensure we're cooperating with big markets like the US who want to see secure supply chains.
PATRICIA KARVELAS:
Drone footage has been posted online which appears to show hundreds of shackled, blind-folded Muslim Uyghur men in China being put on trains to be sent to detention centres. It's pretty horrifying stuff. The foreign minister says it's deeply disturbing. What was your reaction to that footage?
JOSH FRYDENBERG:
Absolutely shocking. Really, really terrible. The Foreign Minister is right. They are deeply disturbing images. And she's also right that this is an issue of human rights that we'll continue to raise both multilaterally and bilaterally.
PATRICIA KARVELAS:
Marise Payne says the Australian Government has repeatedly raised the issue with China. Is there more we could be doing? I mean you can raise it, but clearly this is a situation that is absolutely alarming. These images are just so disturbing. What more should Australia be doing?
JOSH FRYDENBERG:
Well, I think that everyone who sees these images, whether they're in the political leadership of other countries, or whether among the broader public. They will be horrified by those images. And governments like Australia will continue to raise those issues. And Marise Payne has made that clear today.
PATRICIA KARVELAS:
The UN says climate change is hitting harder and faster than predicted. We need to limit global warming to 1.5 degrees by 2050. We have already hit 1.1 degrees and emissions are still rising. Do you think we're approaching a tipping point as scientists tell us?
JOSH FRYDENBERG:
I think this is a critically important issue. People have a very legitimate concern about climate change. And we need to continue to listen to the science, scientists, and we do accept the science of climate change. That being said, as a country who is responsible for 1.3 per cent of the world's emissions, we'll continue to do our part. And our part is a 26 to 28 per cent reduction in our carbon footprint by 2030 on 2005 levels. And just as we beat our first Kyoto target, and we're on track to beat our 2020 target by more than 300 million tonnes, and particularly as we've seen in the electricity sector, a real transition to cleaner forms of energy production and reduction in the emissions from that sector.
This is a transition that is unstoppable across the economy, reducing emissions, but it needs to be done, Patricia, in the most cost effective way as well as ensuring the stability of our energy supply. That's something that the Morrison Government is absolutely focused on. That's why we're implementing the ACCC recommendations around underwriting baseload generation, that's why we're investing in Snowy 2.0 and that's why we'll continue to see more renewable investment across the economy.
PATRICIA KARVELAS:
The UN says all countries need to commit to a 5-fold increase in their emissions reduction targets to meet that 1.5 degree limit. Will the government consider that?
JOSH FRYDENBERG:
We have made our commitment to 2030 and we'll continue to do our part. I have to say on a per capita basis and on a GDP basis, that is a significant target, much more than a number of other countries. And you also have to understand the nature of our country, and that our electricity generation has been traditionally fossil-fuel based. We haven't generated 70 percent of our power from nuclear as the French have, or 20 percent as the Americans have. We're a vast continent with large distances to travel when it comes to the transport industry and the like. Every country is different. As 1.3 per cent of the world's emissions, we're reducing our carbon footprint by 26 to 28 percent. That's above 50 percent on a per capita and GDP basis. We'll meet our 2030 target, just as we beat our earlier targets.
PATRICIA KARVELAS:
The Reserve Bank governor will give a speech tomorrow night, where some economists expect him to flag an October interest rate cut. Do you think the economy needs another interest rate cut, and would it make much difference?
JOSH FRYDENBERG:
Well, I know all too well as the Treasurer I'm responsible for fiscal policy, with my colleagues, and the RBA is responsible for monetary policy. What's really important about understanding monetary policy today is that interest rates are low across the world. And in fact, we're seeing a new phenomenon of low interest rates, low inflation rates and relatively low unemployment.
We have seen the interest rates come down in Australia and I suppose that helps stabilise our housing market. We've seen clearance rates increase, particularly in the key markets of Sydney and Melbourne, as well as prices increase. That's helped stabilise our market. So, the RBA will do what it needs to do and I have great confidence in Philip Lowe and his team.
PATRICIA KARVELAS:
Just finally, what do you make of One Nation senator Malcolm Roberts blaming the Family Court system for the consequences of domestic violence, for domestic violence?
JOSH FRYDENBERG:
Look, as the way you put that comment to me, I don't accept it. And I think, obviously, the Family Court system has a backlog and we're trying to tackle that. And also in terms of reforms to the Family Court system, to ensure that we get the best possible outcomes for families who are going through what is a very difficult period in their lives. We've got to think about the children, and obviously, ensuring that we can get the best possible outcomes for everyone involved in what is a real gut wrenching process for many.
PATRICIA KARVELAS:
Given the comments that Pauline Hanson has made, and she's the deputy chair of this committee, the Law Council has suggested that all MPs on this committee get mandatory family violence awareness training. Do you think that's a good idea?
JOSH FRYDENBERG:
Look, I think colleagues, and Kevin Andrews will be the chair, and others, are well versed in the issues that will be aired at this particular hearing.
Like what I said, we want to achieve, is the best possible outcome for families who go through the Family Court system and that means ensuring they're fair outcomes and ensuring that families get the quickest as well possible outcomes. Because the long waiting times is making an already difficult situation just harder.
PATRICIA KARVELAS:
What is your message though to people like Malcolm Roberts and Pauline Hanson, who have blamed women for fabricating domestic violence claims?
JOSH FRYDENBERG:
Well, I don't agree with those comments. And my view is that we just need to refrain from trying to attribute blame and what we need to do is proceed calmly and in a considered way, with these hearings, with this process, to understand how the Family Court system and the child support system interacts, so that we can create an even better system for all those who use it.
PATRICIA KARVELAS:
Treasurer, thank you so much for joining us.
JOSH FRYDENBERG:
Good to be with you, Patricia.