Assistant Minister to the Prime Minister
GREG JENNETT, HOST: All right, well, time’s galloping away from us on a pretty busy news afternoon on Afternoon Briefing anyway. But we do have enough time remaining for our political panel to cover off some of these events. We have Labor MP Patrick Gorman joining us in the studio. Welcome back, Patrick. And Nationals’ Darren Chester is in Sale in Victoria. Darren, why don’t we start with you. I think you have familiarity through your electorate with some of the bigger generators in this country and you’ve got a beautiful fading light on you there. Hopefully the lights stay. But this whole energy market collapse, you could almost call it, certainly, major intervention today. What’s that telling us about that market itself and the fundamentals? Is it failing?
DARREN CHESTER, NATIONALS MP: Well, good afternoon Greg and good afternoon Pat, and congratulations on your portfolio, Pat, and wish you well. Look, in terms of what you’ve just seen announced by AEMO in the last few hours, I think it’s a very alarming sign to the Australian public that state governments, Federal Government of the past 20 years have failed to manage the energy industry properly. We have got to a point now there is enough blame to go around for everyone. Whether it’s the states who have been sending signals to coal-fired power generators that they’ve got no future. Whether it’s been states putting bans, moratoriums in place on onshore gas. Whether it’s our failure at the federal level to deal with the climate wars over the past 20 years. All of that just says the Australian people is enough blame for all of you get on with it and fix the problem. We have got incredible resources in this country. We’ve got renewable resources, we’ve got fossil fuels available to us. We should be able to get to a solution that provides reliable, affordable a balanced approach to the energy market to make sure Australian households can go about their lives and the manufacturing sector can prosper in the future. So, there’s a lot of blame to go around, I think.
JENNETT: There certainly sounds like there is. I might come back to you to prod a further few suggestions on what the future might look like if we were to redesign the rules. But Pat, as a West Australian, I guess you come at this from a perspective which is not really involved at all, standing free of the market. Maybe that brings you a perspective that says more uninhibited. Is it working or isn’t it working? I mean, are we looking at a market failure and a major rewrite of the rules?
PATRICK GORMAN, ASSISTANT MINISTER TO THE PRIME MINISTER: Well, we welcome the intervention that’s been announced today. This is necessary to keep people’s lights on, to keep people’s heaters on. And where we did have for a period of time a market that was not working, was not delivering for the customers who need reliable energy to their homes. This is the appropriate response.
JENNETT: Does it guarantee? I mean, from what the … from the way that it was explained by the chief executive, it doesn’t necessarily guarantee stability through the next 24 or 48 hours, especially not if you live in New South Wales.
GORMAN: I think it sends a pretty strong message that the expectation on operators is that they supply into the market. This is a temporary intervention that will be reviewed on a daily basis. But it also acknowledges that what we do need to do is to make those big steps towards more renewables and more diversity in our energy mix. Now, if you look you’d mentioned about coming from Western Australia, obviously we’re not on the national grid, but as a West Australian, I’m concerned about this because I don’t want any Australian to not be able to put the heater on or not be able to get affordable energy, because that has implications for all of us and indeed for businesses too. If businesses and the East Coast are paying too much for energy or are unable to get it, then that affects supply chains that go through the whole country. So, this affects everyone, including West Australians who as you mentioned, aren’t on the national energy grid.
JENNET: Face value and they’ll have to be further investigation. Is there reason to believe the generators have been playing ducks and drakes, cat and mouse with the system over particularly the last few days?
GORMAN: Well, I hope that’s not the case. I really do, because obviously we’ve got, we’ve had some very cold weather. We’ve had people who want that certainty. We’ve put out our plan to get that long-term certainty into the energy market, and that’s about helping the transition to more renewables. We know that that’s the cheapest option. We know that over time it is the most reliable part of our energy mix. It’s going to take a big transition.
JENNETT: And Darren, back to you. Just on that question, do you have any suspicions that the reason we saw this intervention today was in direct response to generators who were just playing hard to get really with the power? And if that was the case, should there be consequences for them – big ones financially?
CHESTER: Well, the energy market regulator will take care that. I’ve got no knowledge of anyone acting inappropriately. But what I would say is the Australian public understands there is a transition underway where more renewables will come on board. But they also need to appreciate we still need that reliability, that affordable baseload, that dispatch ability, which is coming from places like La Trobe Valley here in my electorate we’re still in excess of 60% of Victoria’s energy still comes from La Trobe Valley Brown Coal. That’s just the important factor. We need to recognise that that is there, it’s reliable, it’s affordable in normal circumstances. So, what we’ve seen though in the conversation over the last 48 hours in particular just demonstrates to the Australian public that across the board, state and federal governments need to get their act together and get the energy market working in the longer term. Now this is this is not just come overnight. This has been two decades in the making and it’s the crisis in most recent 48 hours is something that I know Pat’s aware of, I’m aware of and something that the Australian public has every right to demand that gets fixed.
JENNETT: Yeah, may well become another major reset point. There seem to have been a few of those, including on wages today. Pat, no argument from your side, obviously, but again, there’s a degree of catch up to an ever-receding finishing line here. Inflation is going to run away from us again pretty quickly. So, what happens next on wages?
GORMAN: Well, I did see the comments from the Governor of the Reserve Bank yesterday saying that we are going to see more inflationary pressures in our economy and we have to be ready for that. We have to accept that that’s the forecast that we have for the rest of this year. But on the wage increase that was announced today, Labor called for it, we backed it, we wrote to the Fair Work Commission saying they should do this and we welcome the decision. That’s $40 a week for Australia’s lowest paid workers. These people are the heroes of the pandemic. They have done so much heavy lifting for our whole economy over the last few years and they deserve every single cent of that pay rise. And it’s a good thing for small businesses too, because that money will go straight back into the economy.
JENNETT: We could be having this conversation again this time next year. Looking at much greater inflation figures. So, it’s going to be a constant process of catch up, isn’t it?
GORMAN: Well, there’s a whole range of parts of the economy and levers that different parts of government can pull to make sure that we do, as best possible, keep inflation, as best possible, under control. We know that we’re looking at a likely inflationary figure around 7% towards the end of the year. Having that indication means the Government can start to think about, well, what do we do and how do we make sure that that again those on the lowest incomes are the ones who fall the most behind? And that’s why I welcome this increase today.
JENNETT: Fair enough. Darren, I don’t think you’re going to quibble too much with the decision of the independent umpire, are you? I’ll let you answer that. And then I might ask you about something you’re familiar with on defence.
CHESTER: Thanks, Greg. No, I do welcome the decision, and I recognise that particularly for someone like myself representing an electorate where we have some of the lowest household incomes in the nation that we have some low-income earners in particular who will benefit from this decision. In terms of small business, there’s no question that for some small business operators, it will add to the price pressures for them, the input cost pressures, sorry, and will have an impact on them. But overall, I think it’s a generally a positive announcement for our low-income earners. I would acknowledge also, Greg, that it’s a bit of an issue, though, for some of our people in the agricultural sector. They’re the price takers. They’re not price setters. So as their transport costs go up, as energy costs go up and their wage costs go up, they need to see a better return at the farm gate as well. So, I’ll be keeping a very close eye on the Coles and Woolworths of the world to make sure some of those higher prices are actually coming down to the farmers and see a return to profitability as well.
JENNETT: Yeah, OK, as flagged. I did just want to get a final thought from you, Darren. Richard Marles is in Japan today. Singapore before that earlier this week engaging on these relationships. What is your assessment of the early start by that minister, but particularly in managing the broader settings of the region, where China, of course, is the major player.
CHESTER: Well, I think the conversation in Japan, certainly in keeping with the reciprocal access agreement that the former prime minister and the Japanese prime minister negotiated in January this year, our relationship with Japan is incredibly important. I have seen that the work the Japanese Defence Force has done in partnership with Australia in terms of humanitarian aid, disaster relief, but also in exercises together to make sure we have that interoperability that’s important that we continue to build on that relationship. So, I certainly welcome the visit to Japan.
JENNETT: Pat, your assessment of that. I mean, can we expect, as a consequence of the agreement, but also of Richard Marles’ visit, that we’re going to see more Japanese troops on Australian soil and more regularly?
GORMAN: Well, I agree that this has been a good visit for Australia. You know, the Deputy Prime Minister, the Defence Minister out in Singapore, in Japan, representing Australia’s interests. And, of course we need to be working with our partners in our region. So, this is a good thing I’m sure it will be good for the training of the Australian Defence Force and for those that we work with around the world. And I think Richard has had an incredibly good first overseas visit as Deputy Prime Minister. It’s been good to see him representing our country on the world stage.
JENNETT: And some of the regional outreach goes on. I think Penny Wong has flagged today that she’s off to Solomon Islands before too long, no doubt. What trying to close the book on some recent strife there from Australian foreign policy point of view.
GORMAN: You can speculate on how that visit may proceed, but obviously I’ll leave the Foreign Minister to get on the plane, get there, have her meetings with her counterparts.
JENNETT: What we can say, Pat Gorman, is she’s been very active. Penny Wong, straight out of the gate. Thanks so much for joining us in the studio today. And Darren Chester, apologies to both. The time squeezed us, but it has been a rather eventful afternoon on Afternoon Briefing.
