TOPICS: AUKUS; cost of living pressures; electricity prices; the Prime Minister’s broken promise on a $275 cut to your power bills; gas supply.
16 March 2023
Good morning. My name’s James Stevens, and it’s my great pleasure to welcome Peter Dutton here to my electorate of Sturt and of course here to Adelaide, along with my colleague and the Liberal Senate leader and Shadow Foreign Affairs Minister Simon Birmingham. It’s great to have Peter back here in Sturt today, but particularly only a few days after the culmination of all of his excellent hard work in achieving the AUKUS outcome, both from a capability point of view for our defence forces, but of course also for the South Australian economy.
We’re very excited about the opportunity for South Australia and my electorate here of Sturt, of course, that Peter’s hard work as the Defence Minister in the Morrison Government is going to deliver for us here in South Australia.
Peter and I are also taking the opportunity to visit some local businesses after this, to talk to them about some of the challenges here in the South Australian economy, because of course here in South Australia, much like the rest of the country, businesses are starting to do it quite tough and electricity prices and mortgages and debt financing, all those issues are starting to put a lot of pressure on businesses in my seat of Sturt, as they are across the country.
So, I really appreciate Peter being here with me and Simon today in Stuart. It’s a great indication of his interest in the opportunities here in South Australia and making sure that towards the next election, we’re taking a very strong positive agenda for the people of Stuart, for all South Australians to them, whilst understanding the challenges that we have here in the economy, but also looking to those opportunities into the future.
So thank you Peter for being here today and I’ll now invite my colleague Simon Birmingham to say a few words.
Thanks very much James. And it’s always good to be out and about in our shared electorate of Sturt with you. Peter, thank you so much for coming to Adelaide, it’s critical week for South Australia’s economy, South Australia’s defence industry and critically for ensuring that we have the defence industrial capability and defence capabilities that our country needs.
There is nobody better placed in Australian politics and current Australian leadership to understand the challenges of these projects than Peter Dutton, who was Defence Minister, who helped seal the AUKUS deal, who oversaw that deep embedding of partnership between the US and the UK and in doing so had a firm eye for making sure that we built the defence industrial workforce necessary to succeed in terms of AUKUS.
Peter didn’t just oversee the arrangements for AUKUS and the nuclear powered submarines, he critically made the decision as Defence Minister to commit to the life-of-type extension for all six Collins-class submarines. He also made the decision to commit to the upgrades of the Hobart-class air warfare destroyers, and with those upgrades and extensions to the Hobart-class and the Collins-class ensuring all of that work took place in Adelaide. More jobs in South Australia. Jobs that aren’t just important to our economy, but are crucial to ensuring the defence industrial capability that we need to make AUKUS a success. That’s why we are so firm in our bipartisan support of the AUKUS venture, but also want to be so clear in our scrutiny of it and ensuring transparency around it.
From a South Australian perspective, it is important that we get some straight answers about what’s going to happen with the Collins-class life-of-type extension. We’ve had very different statements this week from Peter Malinauskas, compared with Richard Marles. Which of them is actually speaking the facts? Because Richard Marles certainly keeps leaving the door open to the suggestion that not all six Collins-class will undertake the LOTE extension, that not all six will remain in operation until the end of that scheduled program. If that’s going to be the case, if that’s the intention of this government, then they should be upfront and they should outline precisely what the implications for the workforce will be, because not continuing with that program puts at risk jobs at ASC and creates risks in terms of the future workforce that is required.
We’re seeing the government equally take a run on different announcements around university places, yet when university vice chancellors are asked about them, they’re not sure how the places are going to be allocated or what the details are.
The government needs to be clear about these places and they need to be transparent about this land swap proposal that’s coming along. Will proper costings be done? What are the terms of it? Frankly, the South Australian Government should be unconditionally making available the land at Osborne North for the extension of the shipyards and the building of the AUKUS fleet. It shouldn’t necessitate land swaps elsewhere with defence, it is clearly in South Australia’s interests for that land to be made available and the shipyards to be built. If there’s other land involved then there ought to be clear commercial arrangements in place and transparency around just what is actually happening with that land.
So, many questions still to be unpacked and of course big national ones too, particularly in relation to the $3 billion of cuts in our defence industry that the Labor Government have announced. Who’s going to bear the brunt of those cuts? Every part of the defence forces, every part of defence industry now waiting for the Defence Strategic Review to be released, wondering where those cuts will fall, where there will be lost capability or lost jobs as a result of Labor’s cuts to those parts of defence. I’ll hand over to Peter, who has some things around AUKUS, but critically also issues on cost of living and other economic pressures to touch on today.
Peter, thank you.
Well, Birmo, thank you very much. James, great to be back here in Sturt with you and thank you for the work that you’re doing, particularly with a lot of local community groups and small businesses that you have regular contact with. It’s an incredibly important element to the effective work of a local member, and James really epitomises that. He’s a very hard working local MP, a champion for the people of his electorate, and I’m really pleased to be here to support him today and to visit some of those small businesses a little bit later on.
There’ll be 14,000 small businesses in South Australia who, from the 1st of July are going to see yet another increase in their electricity bill and it’ll be about 63,000 households here in South Australia who, from the 1st of July will pay on average about an extra $400. I just don’t know where people are going to continue to find this money from because it’s not just their electricity and their gas bills that continue to go up under Labor. We know that inflation is at a 33 year high and that many of the government decisions that they’ve made actually fuelled inflation and inflation going higher, of course means your interest rates are higher and your mortgage rates are higher.
Somehow Labor just can’t manage money, and every time they get into government we always see these same problems emerge. For many, many families and small businesses, they just can’t balance all of the increase in the cost of living pressures that they’ve faced under this government, and that they’re going to face in the coming years as well. The government’s response is to say, ‘well, you know, suck it up because it could be more’. It’s just no response, particularly when the Prime Minister went to the election promising on 97 occasions that he would deliver a power bill cut, an energy bill cut of $275.
It’s telling that the Prime Minister, you know, since, we’re almost coming up to the first anniversary of this government, not once has the Prime Minister ever mentioned that $275 since he took the Office of prime ministership. He needs to, I think, apologise to the Australian people or explain if he’s going to recommit or deliver on this promise. But somehow I think Australians realise that it’s not the only broken promise from this Prime Minister and from this government, and people are feeling a lot of pressure. I don’t think we should underestimate how difficult many households are feeling it at the moment, and they know that there’s more pressure coming down the line, and they know that the government promised that they had a plan before the election, but just hasn’t delivered it.
Now, I’m incredibly proud of what we’ve been able to deliver under AUKUS. It’s a huge win for South Australia and for our country. Most importantly, it underpins the security of our country and the interests of our neighbours within the Indo-Pacific for generations to come, and that is a very significant outcome. Simon Birmingham as Finance Minister was one of those crucial in the negotiations and obviously in the contemplation of how much money this would cost. I remember many discussions over many years around the National Security Committee and in the Expenditure Review Committee where we had to work out what we would do with Labor’s valley of death in the shipbuilding industry here in South Australia, including as well as in WA.
Labor never ordered a single submarine, not a single ship from an Australian manufacturer when they were in government and they cut defence spending when they were in government down to 1.56 per cent of GDP. That meant that there were no jobs, there were no opportunities for people in South Australia. We came into government, we restored funding and we restored it to 2 per cent of GDP. It allowed us to make the sort of decisions that Simon spoke of earlier. So that it has created thousands of jobs here in South Australia. We negotiated the deal between the United States, the United Kingdom, in relation to AUKUS, and that is going to deliver literally thousands of jobs here in South Australia and for the rest of our economy. We’ve been, as Simon pointed out, and as James has pointed out, absolutely in lockstep to support the government because this is a deal that requires bipartisanship.
But there are reasonable questions that need to be answered. It’s clear that the government’s not going to be able to run three classes of submarines. They’ve committed to the Virginia class, they’ve committed to the Astute – the new version of the Astute from the British, and Navy’s been very clear about this, they don’t have the capability to run three separate submarine types.
The first of the Collins-class comes out of the water in 2026. That will be a two year life-of-type extension, which was a decision we made when we were in government, and then there is a two year drumbeat from there. If the government decides not to go ahead with the six, then we will get ourselves back into a situation, what happens with that workforce in the down years? It’s clear that there are a number of versions coming out from the government at the moment. Penny Wong has one thing, the South Australian Premier has a different view, Richard Marles has another view again about whether they will commit to the six or not, and I think they are reasonable questions for residents here and for workers within the shipyards to ask, ‘is there going to be a period where there’s uncertainty around the industry and the continuity of that work?’
So, there are a lot of questions to ask and I think the government needs to be upfront, not just with the people of SA, but Australians more generally about what the pipeline will look like because investment decisions will have to be made, and as Simon points out, if we have a cannibalisation of Army or Air Force or Navy, then it is going to be all of those workers who are involved in defence industry here in South Australia who will see a disruption or a cancellation to those projects, and that is going to really have a big negative impact on the economy here. The government can’t say that this is just a revenue neutral, it’s not going to cost anything even over the forward estimates, that is not credible. They’ve committed to a major undertaking and they need to explain where that money comes from.
I’m happy to take any questions.
Well, we looked at all of the options on the table. Of course, during Malcolm’s time as Prime Minister, there was no such offer from the Brits or from the United States. The United States hadn’t shared that technology with any other country other than Britain. They did that in the 1950s and we were able to negotiate that outcome. So, that put onto the table options that weren’t available in Malcolm’s time.
Every Prime Minister makes the best decision that he or she thinks serves our country’s needs, and we made that decision to go into the deal with the United States, the United Kingdom, because the nuclear reactor on both the Astute-class and on the Virginia-class out of the United States lasts for 30 years. It can be refuelled or an extension of life at the end of that 30 years, but it doesn’t need to be refuelled, whereas the Barracuda from France, does. So, I think we’ve chosen the best option. The Virginia is clearly best in class and the new Astute AUKUS, the design of that obviously will be underway shortly, and I think will take many of the attributes of the Virginia-class and in all of the circumstances, when you look at each of those available to us, I think we’ve made the right decision.
(inaudible)…there are some concerns in South Australia that this spending (inaudible) over a decade…?
Well, there are always risks with any defence project. You’re talking about nuclear technology, so it’s very complicated. I think one of the biggest risks, frankly, is in relation to the workforce. I remember standing in one of the dockyards here, you know, 12 months ago saying that we would provide thousands of jobs under AUKUS and that this would be a huge win for the South Australian economy. We’ve delivered on that under AUKUS, and South Australia is a huge beneficiary. If Labor makes the wrong calls, which often they do in relation to economic matters, then that will have a negative impact here in South Australia. So, we’ll hold them to account, we’ll support them where it’s in our national interest to do so. But I think people are right to question whether there will be a continuity of work or what they’re going to do with Collins-class, because there’s been ambiguity around the language and there’s still no certainty that the government’s committed to the six life-of-type extensions for the Collins-class because by the government’s own admission, they can’t run three classes of submarines. So, there’s a little bit to reconcile there. We’ve been very constructive, we’ll continue to support the government, but I think people are right to ask those questions.
Paul Keating said it was the worst deal in history. Your thoughts on that?
Well, I mean, there’s lots you can say in response to Mr Keating’s remarks. He’s given a character assessment of the Prime Minister and Penny Wong and Richard Marles. I think frankly, he speaks for an element of the Labor Party that would be horrified of this deal because of the nuclear element, because of the United States element, because they’re so far left that they just can’t imagine or contemplate what it is the government’s entered into.
We supported the government and we believe it’s in our national interests to go into this deal. It’s based on the best possible advice that we can get from our intelligence agencies. I know that Mr Keating dismisses them as kooks, but the fact is that they’re some of the most distinguished Australians, they’ve served our country in uniform and I think we take the advice of the intelligence agencies and the heads of our defence and intelligence assets. I think they’re a great national asset, but I think we should take the advice of those people who lead those agencies ahead of Mr Keating.
I think also, it shouldn’t go without comment that Paul Keating yesterday, his treatment of particularly one of the female journalists I thought was repugnant, and yet we’ve heard nothing from Penny Wong or others to chastise Mr Keating or to push back on his behaviour. It really was classic Keating in the sense that he got a headline, but I think we’ve sort of gone beyond the funny stage now and it’s actually quite sad in a way, and I think Mr Albanese should be providing a response or at least calling Mr Keating out for his treatment, particularly of the female journalist yesterday.
I have some questions around gas. The AEMO says more gas needs to be produced for the domestic market. Are there new gas projects that you would like to be approved immediately?
Well, I mean, on the one hand the government’s arguing – and Chris Bowen and Tanya Plibersek do this – that we shouldn’t have any gas in our system. The other part of the debate that, you know, when they speak out it the other side of their mouth, you’ve got Madeleine King out there saying that gas is a great thing. The reality is that we all want to reduce emissions. We want renewables in our system, but we need to recognise that the technology is not there yet in the batteries or in the storage of renewable energy to get us through the periods when the solar panels aren’t working or the turbines aren’t providing that input into the system. We have to have gas, we have to have coal until we’ve got a new system, and if we don’t, then the lights go out, there’ll be disruption.
One of the worst things that you could have if, you know, we go and see a butcher later today or we go and see an IGA or a supermarket, their cold rooms, they need to run 24/7. I mean you can’t go into Woollies on a Monday morning if the power’s been off all night, if you want to get something out of the freezer or out of the fridge. I mean it just defies reality. So, we have to have a sensible conversation because many of the decisions that Labor’s made so far will result in a disruption to our energy supply – so that means blackouts – and it’s going to mean increases beyond what we’re seeing from the 1st of July. For 63,000 households here in South Australia, they’re going to pay another $400 on top of their already increased electricity bill under this Labor Government, and the decisions that Labor is making at the moment are going to push your power prices higher and higher, and AEMO and others have pointed this out.
Just another question on gas. Should the government pull the gas trigger (inaudible) gas exporters so they supply to the domestic market?
Well, coming into the election, the government promised that they had a plan to deal with all of this. The Prime Minister promised, that based on that plan, he could deliver you a $275 decrease in your power bill. He promised it, not just once, it wasn’t just an off the cuff remark, he promised it on 97 occasions, and he’s never mentioned it since the election. In the budget, they talked about providing more money for groups who were trying to stop gas projects from going ahead, which again, will result ultimately in a disruption to supply, or an increase in people’s power prices. So, if the government had a plan before the election, we need to hear about it. How do they plan to deal with gas reserves and other aspects of the policy that they’ve got on the table? I just don’t think the broken promises are going to cut it for families who continue to pay more and more under Labor.
When do you think green hydrogen will start to play a bigger role in the energy mixture?
There’s obviously a significant investment that we’ve made as a country, certainly when we were in government into all types of renewable. We have – on a per capita basis – one of the highest uptakes of solar in the world. That was only possible because of the Coalition’s investment into renewables. We had very significant investments in relation to other prospective technologies. The green hydrogen is one such example where we provided support and you know, there will be analysis as to the timelines and what prospect there is into the future. Some will succeed, others won’t. But when we were in government, we put significant investments into renewable energies and we still need to firm them up. If you turn gas off and you turn coal off, then those fridges won’t work, those freezers won’t work, and that would be devastating for, not just families, but the economic impact as well.
You raise concerns of the cost of living crisis, but do you think it is a good time for a $400+ billion submarine deal during this time?
I just think Australians understand that the circumstances in our region have changed dramatically. I think every Australian except Paul Keating gets that and you just can’t be blind to the intelligence, to what it’s saying and not act on it. I think that would be negligent and we entered into the negotiations for AUKUS, knowing that the circumstances have changed and we want to see peace prevail in our region. We want stability, we want our very important trading partners to continue to have that relationship with us. We don’t want to see bullying in our region. We don’t want to see coercive activity. We don’t want to see our citizens the subject of data breaches, etc.
So there’s a lot that is in AUKUS, it’s not just the submarine deal, but it’s also the investment in space, in AI, many other elements of that deterrence which will be very important in the years to come. As I say, the negotiations that we had at the time were difficult and it had started in 2020, and ultimately it’s come to fruition now. So, as a Coalition, I’m very proud of the fact that we authored that and we did the deal that wasn’t possible when spending was so low under Labor, and I’m very pleased to be able to support the initiatives that the government’s announced with President Biden and Prime Minister Sunak in San Diego this week.
Yesterday we heard about the land swap, do you think Defence should be giving up the (inaudible) they are pretty (Inaudible).
Well, as Simon pointed out before, I think the South Australian Government has a particular responsibility here. There is a lot of activity, thousands of jobs that we’ve been able to create because of AUKUS and we want to have a situation where ultimately we’re not going to cannibalise Army or Navy or Air Force. The work that they do is incredibly important and in terms of land and the rest of those arrangements, well, let’s see what can be negotiated between Defence and the State Government and the private providers who will come in as well. But I think the most important question at the moment is, ‘is the Albanese Government committed to the six life-of-type extension for the Collins-class or not?’ Because if not, then that will mean a loss of jobs here in South Australia and I think it’s reasonable that they answer that question sooner than later because they’ve created a lot of angst and ambiguity in their language so far.
What do you think about the Collins-class (inaudible)?
Well, we committed to the Collins-class life-of-type extension. The first boat, as I say, is scheduled to come out in 2026. That was a decision of the Coalition Government and there’s been a two year drumbeat. Each comes out of the water two years later and so on, and we needed to do that because we want to extend the life of a very important submarine.
The Collins-class serves our country very well, but it’s got an expiry date, and the new technology in the nuclear submarines make it a much superior class of submarine. But there’s still a lot of work for the Collins-class to do, and there’s a long time before the work actually starts on the submarines that have been negotiated through the AUKUS deal from the Brits.
So, how is all of that reconciled? I think they are reasonable questions for James Stevens and Simon Birmingham and my other South Australian colleagues to continue to ask of the Albanese Government.
I’ve got one more question, just on productivity, the Treasurer says there’s a clear need to lift productivity across the economy, all workers will work longer for less. How should the government go about things?
Well, I mean the Treasurer put together that very long essay, a very long and tortured essay. I don’t know how many of the 6,000 words were Paul Keating’s words, but we do know that Jim Chalmers did a doctorate, his doctorate on Paul Keating, which in itself must have been a tortured exercise for him. But how many of the words in the essay of Jim Chalmers can he attribute to Paul Keating? I mean they must be pretty wild conversations in private when you see what Mr Keating has to say publicly about Anthony Albanese and Richard Marles.
I think if Jim Chalmers has difficulties understanding productivity, he has difficulties understanding how to get inflation under control. The difficulty in the end is that Australian consumers end up paying the price for Labor mistakes, and you know, Labor always finds itself in a bad situation when they get into government. It’s because they always pull the wrong levers. They just can’t manage money, they always push up interest rates higher than they need to be. Your power bills will always be higher under Labor. Your gas bills will always be higher under Labor, and when you go to the supermarket, you go to the checkout, the bill is always going to be higher under Anthony Albanese and we should be very clear about that.
There’s no way in the world that the Prime Minister is going to deliver a $275 cut to your electricity bill, which he promised on 97 occasions because he simply didn’t have a plan and he misled the Australian people. It’s not the first and it won’t be the last broken promise that Anthony Albanese makes to the Australian public.
Thank you very much.