DAVID SPEERS:
Treasurer, thanks very much for your time.
TREASURER:
Thanks. Good afternoon.
SPEERS:
Is the National Energy Guarantee dead?
TREASURER:
No, not at all. It remains Government policy and, in fact, states now have the opportunity to go forward with the critical component which is the reliability mechanism. The New South Wales Government is very supportive of that. They're keen to pursue it but it needs to work through that COAG process. Getting reliability in the energy market has always been a critical component of this and one of the things that first ensures that you keep the lights switched on so…
SPEERS:
It was one part of the NEG.
TREASURER:
Well, it was a critical component of the NEG. I sat through all of the energy sub-committees of Cabinet, met with the ACCC, worked with all the other operators on reliability – I mean, emissions reduction was a given because there was already a commitment on that. The reliability was the missing piece.
SPEERS:
Why was there so much effort expended on legislating emissions reduction?
TREASURER:
Well, you need – as part of that element of the operation of the National Energy Guarantee – a reference to a particular figure and that can be done in any number of ways but that is necessary to make that component of the scheme work. But the truth is, on the emissions reduction, we're pretty much meeting that target in a canter anyway. What really needs to change is the reliability components of this system which drives the behaviour around investment and the contracting of reliable electricity in the energy market which is what gets prices down and keeps the lights on.
SPEERS:
Just on this question about whether the NEG is dead. Andrew Gee, one of your backbench colleagues, says, 'I welcome plans to abandon the NEG.' Craig Kelly says, 'The PM's shown courage to drop the NEG.'
TREASURER:
We're not.
SPEERS:
So they've got it wrong?
TREASURER:
No. The Government's policy remains exactly as we've presented it and with some further improvements – particularly the requirement that if anyone wanted to change that in the future, they would first have the work done to see if it would lift power prices and if it was going to lift electricity prices – well, that would be a blocker.
SPEERS:
Can you understand the confusion around all of this though? We've had very different messages from yourself, the Prime Minister, the Energy Minister over the last week about whether we need to actually legislate emissions reduction.
TREASURER:
David, here's the message. Electricity prices down. That's what you've got to do, what we've announced today – in particular, in my area with the ACCC – are three big things. First one is to ensure there's a safety net price. So, if you go to that standard offer, your price will fall between about $180 and $416 a year. And for small business, medium businesses: $500 to $1,500. Second one is the big stick and that's to ensure the prices are monitored and the big companies are kept under control and those powers are pretty serious. For the first time, divestment powers being part of that package and thirdly, ensuring new energy generation – investment in that – being guaranteed with their financing. So, that's on…
SPEERS:
Just on the divestment powers you've announced. The ACCC in their report last month said, 'The ACCC does not believe it would be appropriate to intervene, to unwind the way in which the market is evolved.' They didn't support this idea.
TREASURER:
Well, I've had this discussion with the ACCC and what that position reflects is with everything else, everything else that is out in their submission, being able to be put into effect. Now, there are many things the states have to do and many things we have to do. Now, what we believe is necessary is to ensure that you have that big stick – just like we had with the gas producers…
SPEERS:
But does the ACCC think it's a good idea to have that big stick and…?
TREASURER:
I think it's a good idea…
SPEERS:
What about the ACCC?
TREASURER:
…And I'm the Treasurer and the Prime Minister's the Prime Minister and we're the Government and we think it's important for us as a Government to stand up for customers…
SPEERS:
But you said you've spoken to Rod Sims…
TREASURER:
Yes, I have…
SPEERS:
What's his view?
TREASURER:
He believes the measures that are in the report…
SPEERS:
Are enough?
TREASURER:
The competitive pressures that are there but that assumes everything in the report is actually all in place. Now, we need…
SPEERS:
Now, he doesn't necessarily back this big stick you're going to give him.
TREASURER:
Well, I wouldn't say the reverse to that either. I mean, Rod Sims can speak for himself. What is necessary though – as he's said often at times – is that you have the ability to really put the wood on these big companies because you know what? If they don't play by the rules, if they go outside the lines, then the benefits of what you're trying to achieve are diminished. So, having the big stick to keep them between the lines is actually what drives the prices down and I want to maximise that.
SPEERS:
Could it force AGL to sell Liddell coal-fired power?
TREASURER:
Look, I'm not going to get drawn on a specific case because it would depend on what enforceable undertakings they might have taken. What other instructions the ACCC might have advised us to issue. Those fundamental principles of competition law haven't changed but just the powers available in the right circumstances…
SPEERS:
But that one may, let's just say for accuracy…
TREASURER:
Well, look, I'm not ruling anything in or anything out but what I am saying is that in the US and the UK, they have these types of power, they're used very sparingly, very sparingly, but they exist. They exist.
SPEERS:
We know the Government's been adamant, this one should stay open, Liddell should stay open so, clearly, this will be a strong candidate to look at.
TREASURER:
We're working to put in place those divested powers on everything from – you know, unstructured separation powers, things about enforceable undertakings, things that force the energy companies to actually not only do business with themselves – you know, locking out all the other companies – I mean, the other ACCC recommendation is that these big companies can't go out and gobble up all these other ones. That's very important.
SPEERS:
Back on emissions though, is it still the Government's policy to legislate an emissions target?
TREASURER:
That's the policy.
SPEERS:
Ok, and when would you put that to Parliament?
TREASURER:
When we can be confident that it would be able to pass the House of Representatives and we'd have to add the Senate as well and you know what the biggest block of that is? The Labor Party. There's lots of discussion today in the Chamber about members on our side and that's fairly obvious but you know what? There would be no need for the conversation if the Labor Party was actually more interested in passing this important legislation…
SPEERS:
As Bill Shorten says, maybe if you showed them legislation…
TREASURER:
I wouldn't – do you seriously think…?
SPEERS:
How do you expect them to support something like a blank cheque?
TREASURER:
I see right through that. This is what…
SPEERS:
Would you support legislation that you've not seen?
TREASURER:
If Bill Shorten were to say – because we know that this is his principal objection, this is the reason why he's not supporting what's there now – he won't support 26 per cent, he wants it to be 45 per cent…
SPEERS:
He's never said he wouldn't support this though.
TREASURER:
Come on, David, if you fall for that, you've been around here far too long…
SPEERS:
As you said…
TREASURER:
…45 per cent is his condition on that legislation.
SPEERS:
Well, yeah, we know he wants a 45 per cent target but he's never said he wouldn't vote for a 26 per cent…
TREASURER:
I don't accept him at his word. I don't trust him. If he was to absolutely say that he would back the Government's legislation and they know what's in it…
SPEERS:
You'd bring it in?
TREASURER:
They know what's in it, David. I mean, all this "I haven't seen the papers", that's just an excuse. I've heard it so many times. They know what's involved with this. They're not newbies to this experience and if they are, goodness help us if they were actually to become the Government. They know what's involved, they know what they need to genuinely do to seek to get together and make this work and they're not doing it because why? They want to stir up trouble.
SPEERS:
Why not sit down and talk to them?
TREASURER:
Well, there's that opportunity but they're not doing it in good faith, David.
SPEERS:
You're in Government. Will you sit down and talk – or offer to sit down and talk to Labor?
TREASURER:
David, we've always been prepared to do things like this but they've got to come forward and not play games. They've got to be fair dinkum about it. We've had too many of these false overtures from the Labor Party time and time and time again…
SPEERS:
You're the Government, will you pick up the line and say, 'We'll sit down and talk to you about this?'
TREASURER:
We want to deal with someone who's going to act in good faith and they have to be able to demonstrate that good faith.
SPEERS:
How?
TREASURER:
By being fair dinkum and stop playing games with it and stop playing politics which is Bill Shorten's playbook every single day that he's in Parliament.
SPEERS:
Can we take it that you are willing to sit down and negotiate with Labor?
TREASURER:
I'm always willing to negotiate with people and discuss things with people who act in good faith and, at present, Labor is showing no good faith.
SPEERS:
Alright, will you take this policy to legislate emissions reduction to the election?
TREASURER:
The National Energy Guarantee is our policy, David. We haven't moved from that. It's an important part of what we're seeking to do and the most, the biggest change on that is actually the reliability guarantee, as we said today, that's what can move forward now…
SPEERS:
But you still want to go ahead with that?
TREASURER:
And it should go ahead.
SPEERS:
The whole point of the NEG was to give industry some certainty, right? So they get on and invest. Would you say that there's any certainty today when we don't know when or if you'll introduce legislation for a target? Labor obviously want a higher target. Where is the certainty?
TREASURER:
Well, the reliability guarantee would provide that certainty on that component and that means companies can start contracting immediately…
SPEERS:
But they don't know what's going to happen on the emissions targets…
TREASURER:
…on reliability. Well, no, they don't. They don't and if the Labor Party is elected, they will make it 45 [per cent], they'll make it 45. Our policy is that it should be 26.
SPEERS:
Why not sit down and settle this for industry's sake?
TREASURER:
Because Bill Shorten doesn't agree with 26 per cent. He doesn't agree with that and if you go higher than that, electricity prices go up and we don't agree to raise electricity prices. Why won't Bill Shorten tell you, or anyone else for that matter, how much electricity bills will increase by having a 45 per cent emissions target rather than 26?
SPEERS:
Well, he…
TREASURER:
I'll tell you why.
SPEERS:
But anyway, that gets into modelling and…
TREASURER:
No, no, it doesn't get into modelling. Frankly, with great respect, what that gets into is him trying to hoodwink the Australian public.
SPEERS:
Alright.
TREASURER:
It will be more expensive at 45 per cent, it's obvious, it's as obvious as the nose on our faces.
SPEERS:
Has this been enough, do you think, to save Malcolm Turnbull's leadership?
TREASURER:
Well, that's not an issue. We're focusing on the policy.
SPEERS:
You haven't had any of your colleagues raise a concern with you about Malcolm Turnbull?
TREASURER:
No, this is not an issue.
SPEERS:
Has anyone raised it…
TREASURER:
This is Bill Shorten and others and this is the media and, frankly, there are troublemakers on our side kicking up the dust. I've been around this place for a while and as long as you, probably a bit longer, people kick up the dust every now and then but you know what? The policy has overwhelming support in the Party room. What we're focusing on is making sure that people are getting their personal income tax cuts, we're seeking to have lower business taxes so people can keep their jobs. I mean, I heard today in the House and Ann Sudmalis sitting behind me today, when we were talking about lower youth unemployment, and she was talking about how much youth unemployment had fallen in her electorate. Now, I know her electorate well on the South Coast, I've spent a lot of time there. That has been a chronic problem, chronic, and to know that young people are now getting jobs, the biggest single year of jobs growth on a fiscal basis in 30 years for young people, I mean, that's what this place is supposed to be about.
SPEERS:
When you're talking about people kicking up the dust, Gary Spence – you'd know him, the LNP president in Queensland…
TREASURER:
I know Gary, yeah.
SPEERS:
He's telling Queensland MPs to back in Peter Dutton. What do you say to that?
TREASURER:
Look, when I was a state director in the Party, there were sort of three legs to the stool – the Party organisation, professional Party wing and the Parliamentary Party. We all keep to our own jobs and when we do that, that's when the Party does its best.
SPEERS:
So, butt out?
TREASURER:
Well, in the same way that I don't get involved in the affairs of the Party organisation, I respect their role in that area and very much so as someone who's worked in the Party organisation. Our volunteers, those who are doing that work, respect them. The Parliamentary Party has its role and it will address those matters according to its rules.
SPEERS:
Would Peter Dutton make a good Prime Minister?
TREASURER:
That's not the question. That's not the question being asked…
SPEERS:
Well, it's a question and it's being discussed by your colleagues…
TREASURER:
I'm not seeking to answer it. I think Malcolm Turnbull is the right Prime Minister and he's the one doing the job and he's the one who's been getting things done in what has been a very tough Parliament. I mean, the question was raised today, 'Oh, you've only got one member extra at 76.' Well, we've got $41 billion worth of savings, we've passed the Registered Organisations, the ABCC, we've now got passed the personal income tax cuts, small and medium sized business tax cuts, childcare reforms that are already in place and already seeing prices more competitive. We're getting stuff done in this Parliament. We're not just in office. We're in power.
SPEERS:
So, final question, Scott Morrison. Would you be prepared to put up your hand as a compromise?
TREASURER:
No, look, David. No. This is not what we're discussing. We're not discussing this. That is not what we're focused on. We're focused on…
SPEERS:
No one's spoken to you about this?
TREASURER:
David, no. They haven't actually and why would they? Because people know that when I'm in the job, I'm focusing on that job as I am and working closely with the Prime Minister to deliver all the things you're talking about so, look, if people want to kick up the dust, they'll kick up the dust. But what's incumbent on me as a Treasurer, the Prime Minister is the Prime Minister, of course, Peter is Home Affairs Minister and Julie is Deputy Leader and so on, is just focusing on the job that we've got and to take people with us.
SPEERS:
Treasurer Scott Morrison, thank you.
TREASURER:
Thanks, David.