PATRICIA KARVELAS:
Treasurer, welcome to National Wrap.
JOSH FRYDENBERG:
Nice to be with you, Patricia.
PATRICIA KARVELAS:
You and the Prime Minister will meet with Federal Victorian MPs first thing tomorrow morning to discuss the Victorian election results. What will you tell them?
JOSH FRYDENBERG:
Well, obviously we’ll dissect what went wrong for the Victorian party and learn the lessons that we can apply to a successful campaign at the federal level next year.
As Matthew Guy, the Liberal Leader said, this was a state election fought on state-based issues. The noise from Canberra certainly didn’t help, but that wasn’t the determining factor.
And if you look at history, Patricia, first term majority governments in Victoria have never been denied a second term in a hundred years in our state.
PATRICIA KARVELAS:
This isn’t about a second term though, Josh Frydenberg, this is a swing to Labor, a significant swing and repudiation in your own heartland, in fact, in Hawthorn, in places that you represent federally. You were quick to separate your federal party from the resounding election loss in Victoria.
But, now that you have had some time to think, do you accept that the knifing of Malcolm Turnbull has been absolutely toxic in Victoria?
JOSH FRYDENBERG:
As I said, the determining factor wasn’t what happened in Canberra, it was what played out on the ground and Labor had a very big spending agenda. When the issues were raised with congestion, they threw more money at transport. When issues were raised with energy prices, they threw subsidies for solar panels. Issues were raised with health, they threw more money at that. Now, people weren’t concerned about the implications or the economic consequences of more spending, because Labor only revealed that it was doubling the debt with 48 hours to go. That is what transpired, and Labor ran a very disciplined campaign in the media too. There were a lot of attack ads, with false accusations of cuts…
PATRICIA KARVELAS:
There were a lot of attack, there was actually a lot of imagery of some of your federal colleagues, in fact, in some of Labor’s state campaign. So you say, oh, look, you know, it’s all a state issue, and yet, Tony Abbott, we know, Scott Morrison, Peter Dutton actually, were in some of that material of the state Labor Party. So they were reminding voters in Victoria of the chaos in Canberra, weren’t they?
JOSH FRYDENBERG:
Well, Labor has been shameless in trying to portray the Liberal Party as making cuts to areas where we are not. And that is particular in the state campaign in Victoria; they were focusing on health and education. And as you know, at the last federal campaign, they ran a Mediscare campaign.
But if you look at the history of Victoria, Patricia, we’ve lost five out of the last six state elections. But at the same time, we have won four out of the last six federal elections. So, Victoria is slightly different to other parts of the country. There will be lessons to be learned, particularly around the grassroots ground campaign that we need to run and countering some of these lies for the Labor Party…
PATRICIA KARVELAS:
Okay, but does it prove that Victoria is Australia’s most progressive state and that Victorians don’t like Liberal politicians they perceive as being from the hard right?
JOSH FRYDENBERG:
Look, I disagree with that, completely.
PATRICIA KARVELAS:
You don’t think there has been a repudiation of a lurch to the right?
JOSH FRYDENBERG:
Look, I think, as I said, it was an election that was run on state based issues. There was a lot of…
PATRICIA KARVELAS:
But you don’t think, my question is, do you think it is a repudiation of the Liberal Party lurching to the right?
JOSH FRYDENBERG:
No, I don’t. I don’t accept what you have just said to me…
PATRICIA KARVELAS:
Ok, but seats like yours are in trouble if this result is replicated at the federal poll. Do you think your party should pivot on policy to appeal to voters who are rejecting your party’s direction? We are talking about ‘small L’ Liberals, we are talking about the people, like the people in the seat of Wentworth that you recently lost a federal electorate to. That’s what we are talking about here. Does your party need to pivot on some policies?
JOSH FRYDENBERG:
Well, it is interesting, Patricia, I doubt you would have put these questions to Anthony Albanese after they lost the recent Tasmanian state election or the recent South Australian state election. Or, indeed, after Bill Shorten did his famous victory lap after the 2016 election only to spend three years in opposition. The reality is, we have seen big swings in Victoria before. In 2002, during the halcyon years of the Howard and Costello Government, when the economy was doing very well, Steve Bracks won 19 seats off the Coalition and it was an 8.5 per cent swing against the Coalition in that state. So, I’m not saying there aren’t lessons to be learned, of course there are…
PATRICIA KARVELAS:
Okay, let’s talk about the lessons then on policy. Because there has been a view that your political party, federally and clearly it played out at a state level, has neglected issues, one that you worked on climate change and energy, for instance, that you have moved in a direction that the electorate is uncomfortable with. The electorate in your own heartland, do you think you need to recalibrate those policies now?
JOSH FRYDENBERG:
Well, we are focusing on reducing emissions and reducing power prices at the same time. What didn’t stick on Daniel Andrews in Victoria was the impact of his policies that led to an 80 per cent increase in wholesale power prices in that state following the closure of Hazelwood and the drastic interventions that were required by the energy market operator, who were concerned about the stability of the Victorian system. And the fact that Victoria became a net energy importer at certain times as opposed to always being an exporter of energy.
Now, the argument was put but it didn’t stick to Labor. What we need to focus on is ensuring that the people get the lowest possible power prices because that is their first concern and we are doing that through implementing the ACCC’s recommendations.
But, when it comes to emission reduction, we also have policies in place there, whether it’s the Emissions Reduction Fund or the National Energy Productivity Plan or the Renewable Energy Target, or the work of the Clean Energy Finance Corporation that has seen emissions get to its lowest level on a per capita GDP basis in 28 years.
PATRICIA KARVELAS:
Alright, let’s just clarify. So, you don’t think there needs to be a recalibration of policy to appeal to some of your heartland that you clearly are losing in places like Victoria and other places across the country?
JOSH FRYDENBERG:
Well, look, our core equities are economic security and national security. And when it comes to the economy, it is running well. We have seen, since we last met in Parliament…
PATRICIA KARVELAS:
So no collaboration, you’re just talking about your economic policy but I am asking you, more broadly, do you think at that meeting tomorrow morning, will you talk about a pivoting on these policies?
JOSH FRYDENBERG:
Well, what we will focus on is the lessons to be learnt out of the state campaign. But more importantly, how to rebut some of these Labor lies and to do that in real-time that we know will come at the next federal election as it came at the last federal election.
But, when we come to our policy settings, we know our economic plan is working. Unemployment is down to its lowest level since 2012. We’re growing, the economy is growing at its fastest rate since the height of the mining boom. We have created more than a million new jobs and cut taxes…
PATRICIA KARVELAS:
Okay.
JOSH FRYDENBERG:
That is what we are delivering for the people across Victoria and across the country…
PATRICIA KARVELAS:
There has been a lot of debate that this was the failure of a scare campaign in Victoria. One senior Liberal MP has told Fairfax Media that Peter Dutton’s claim in January that Victorians were scared to go out to restaurants because of African gang violence had caused enormous damage in the state. Do you think it caused lots of damage?
JOSH FRYDENBERG:
No, I don’t. And I think he was actually explaining a reality that we have seen in Victoria which is…
PATRICIA KARVELAS:
What’s the reality? Victorians going out being scared? I don’t know many Victorians that are scared to go out.
JOSH FRYDENBERG:
Well, Patricia, the numbers show a dramatic increase in crime on Daniel Andrews watch. Home invasions…
PATRICIA KARVELAS:
Are Victorians scared to go out, Josh, honestly?
JOSH FRYDENBERG:
Well, I can tell you that people have a concern about their level of safety…
PATRICIA KARVELAS:
That’s a different question, that’s a different question.
JOSH FRYDENBERG:
Well no, yeah, but it’s all around the same topic, which is there has been a 43 per cent increase in home invasions in Victoria. We’ve seen carjackings; we’ve seen a break down in the juvenile justice system. I mean, during the campaign we saw, a guy you know, chefs beaten up in the St Kilda foreshore. I mean, we have seen repeat incident after incident, where people’s safety has been threatened in the state of the Victoria.
Now, John Pesutto and Matthew Guy put a very strong set of policies to increase the penalties that would apply. In response, what Daniel Andrews said was he was going to increase funding for the police...
PATRICIA KARVELAS:
Sure…
JOSH FRYDENBERG:
…and obviously Daniels Andrews won the election.
PATRICIA KARVELAS:
He certainly did. Labor has adopted the National Energy Guarantee, which is your baby, it’s your creation. How can you…
JOSH FRYDENBERG:
I’ve got two babies, thank you very much.
PATRICIA KARVELAS:
Okay, I know you’ve got lovely babies, but so is the NEG. How can you personally argue against a policy that you came up with?
JOSH FRYDENBERG:
Well, as I said the day after the policy was dropped, you know, no one was more disappointed in the fact the NEG didn’t become a reality than me. I mean, that’s just a statement of fact. We put a lot of work into that.
But the issue with the Labor’s Party energy policy is not the fact that they have adopted the NEG, it’s more that they’ve adopted these recklessly high targets, which we have been consistently opposed to. Whether it is a 50 per cent renewable energy target or an even more destructive 45 per cent emissions reduction target…
PATRICIA KARVELAS:
Sure, we know you are against the targets attached…
JOSH FRYDENBERG:
But that is the key…
PATRICIA KARVELAS:
But the NEG is the architecture, you think it’s a good plan still. And now it’s Labor policy.
JOSH FRYDENBERG:
No, I actually think Labor’s targets, regardless of the mechanism that they use, will cause immense damage to the Australian economy. You’ve heard from the Business Council of Australia, saying it would be a wrecking ball through the economy, you’ve heard other groups repeat the similar concerns.
Labor has adopted these targets in virtue signalling to the electorate, again they are splashing out money, you know, unconscious of what will actually happen to the stability and the affordability of power as a result.
PATRICIA KARVELAS:
On Victorian President, Michael Kroger, you are aligned to him and you’ve supported him, that’s what your colleagues tell me. Should he take responsibility for what has happened in Victoria and resign early?
JOSH FRYDENBERG:
Well, I’m not calling for him to resign early, others have said that. I have not joined that chorus; he has been a great servant of the party over many decades. There will be a proper review of what went wrong in this campaign and I would rather wait for the outcomes of that review than engage in finger pointing at this stage, which can only be counterproductive…
PATRICIA KARVELAS:
Do you think, do you think it is a good idea the party president is on TV as a paid commentator? Surely, that is a conflict of interest?
JOSH FRYDENBERG:
We’ve got parliamentary colleagues who are on TV, I don’t know if they’re paid commentators.
PATRICIA KARVELAS:
But he is a paid commentator, isn’t he? I understand they’re not.
JOSH FRYDENBERG:
Well look, can I just say with respect to Michael, yes he has got a high public profile that can also be used to the parties advantage. And my view about Michael is he has been a loyal and valuable servant to the party over many decades. But, he has also made it clear, Patricia, that he is not recontesting the presidency next March.
PATRICIA KARVELAS:
Okay, just finally, on a call for a National Integrity Commission. Are you going to drag your feet on this one, just like you did with the Banking Royal Commission?
JOSH FRYDENBERG:
Well, we already have inter-agency, multi-agency, integrity measures right across the board, across about sixteen different agencies. We have a public service commissioner; we have an inspector general of taxation, defence, security…
PATRICIA KARVELAS:
So, you haven’t changed your mind? You think this is needed?
JOSH FRYDENBERG:
No but we can always improve this framework, we can always improve this framework and Attorney General Christian Porter has said that he is opened minded as to how we can improve that framework.
But, Bill Shorten said eleven months ago he was going to engage in deep consultations, drafting, discussions about such an integrity framework or integrity commission. And we’ve seen nothing. We’ve actually seen public policy by press release from Bill Shorten and we know that it is a political stunt on his behalf, again.
PATRICIA KARVELAS:
Treasurer, thanks for your time.
JOSH FRYDENBERG:
Nice to be with you.