Interview on ABC Adelaide Breakfast with Matthew Abraham
Topics: Coca-Cola Amatil’s operations in South Australia; Business confidence in South Australia; Energy costs; Labor’s commitment to a 50 per cent RET
Matthew Abraham: Time for Super Wednesday when we pull together, South Australian politicians, federal politicians who come from this state, grew up here, elected here, but are players on the national stage. Simon Birmingham, Education Minister, welcome to ABC Adelaide.
Simon Birmingham: Good morning Matthew.
Matthew Abraham: And we also welcome Amanda Rishworth, Federal Labor Member for Kingston. She’s Shadow Minister for Vet Affairs and Defence Personnel, in our Canberra studio, Amanda Rishworth – welcome to you.
Amanda Rishworth: Good morning. Nice to be with you.
Matthew Abraham: I can hear you there. And Nick Xenophon, SA Senator and leader of the Nick Xenophon Team Party.
Nick Xenophon: Good morning on a not so super Wednesday.
Matthew Abraham: No. Have you just got off the phone with the CEO of Coca-Cola Amatil?
Nick Xenophon: I spoke to Alison Watkins. She put in a call to me. I just had a discussion with her and I guess it’s going to be in the earlier part of 2019. Obviously Coca-Cola Amatil is a major company with an iconic brand and I think that they will do all they’re required to do by law in terms of entitlements for workers but that doesn’t take away the fact that 180 direct jobs will be lost.
Matthew Abraham: Well what’s wrong with Adelaide? Did she say- I mean they’re saying they want to maintain their competitiveness in the market. Well why couldn’t you do that in Adelaide? I mean we’re meant to have a lower cost and a lot of other advantages here.
Nick Xenophon: Well, we’ve lost those advantages over the years. She assured me that- the CEO assured me that it was as a result of national strategic decisions and that the whole issue of power wasn’t the determining factor, but I think it’s clear leaving aside the conversation I had with Ms Watkins that higher power prices aren’t good for business and in order to get more jobs back in the state we need to tackle the issue of reliability and reducing power prices here.
Matthew Abraham: Nick Xenophon, stay with us obviously for Super Wednesday. Simon Birmingham, Education Minister in our studio. Nick Xenophon saying that the CEO is saying that high power prices or instability in supply is not a factor here. What do you think would be a factor? Why would they leave?
Simon Birmingham: Well Matthew, that’s really a matter they of course have to answer and firstly all of our thoughts I’m sure go to the workers and families impacted this morning and the shocking news that they’ve just received. Coke has obviously made an announcement that they’re going to shift production activities, not out of Australia, but to Queensland and Western Australia and that is clearly a vote of no-confidence in some way in South Australia and there have to be issues here in the state that must be looked at that are relevant to Coke’s decision.
And I’m surprised to hear that they would say energy reliability and affordability is not one of those issues because frankly we have major producers like Michell Wool manufacturers who recently said that they were finding it cheaper on certain days to shut down production rather than to pay the power bills and clearly those same problems must afflict a company like Coca-Cola.
Matthew Abraham: Well their statement to the Australian Stock Exchange says they’re not going to develop- they’re going to close it but they’re not going to develop the Thebarton site because it’s constrained by its CBD location, site layout, dated infrastructure and expensive logistics. That’s the reasons they give. They don’t mention power. I don’t know what expensive logistics are for a company making soft drinks.
Simon Birmingham: Well I’m sure there are all sorts of transport factors and other things, but equally you would have thought that a central location like that meant that transport costs were actually less in a number of instances in terms of getting to the different marketplaces they have within South Australia. But ultimately this is another blow to the South Australian economy, another loss of jobs in South Australia and it is a national company, a global company choosing to invest in other states of Australia rather than here in South Australia and that’s a great big wake up call for the State Government as to how we get the policies right in SA to stop this drift of jobs away.
Matthew Abraham: Amanda Rishworth, Federal ALP Member for Kingston, Shadow Minister for Vet Affairs and Defence. You’re in Canberra. Is this a great big wake up call for the Weatherill Labor Government?
Amanda Rishworth: Well I think it’s an important signal and I’d like to say first of all my thoughts are also with the families, those affected, those workers and I think it is important that we take stock of this and actually make sure that both the State Government but also the Federal Government has a plan for South Australia. Simon was very quick to go and blame the State Government, but of course what we need is a federal government, a state government working together to support first and foremost these workers that are affected. But also to bring confidence around the South Australian economy.
Matthew Abraham: I thought Jay Weatherill had a plan. He spent the entire last election campaign, every day of it walking around holding it to his chest like a shield.
Amanda Rishworth: Well the South Australian Government has invested significantly in a range of projects. What we haven’t seen is that support from the Federal Government. The Federal Government has effectively goaded Holdens out of this state. They don’t have a plan for manufacturing jobs in South Australia. So it’s all well and good for Simon Birmingham to be…
Matthew Abraham: [Interrupts] I think $18 billion for the submarine project.
Amanda Rishworth: Well look they were brought kicking and screaming to that project, and of course we’ve seen other projects – for example the supply vessels be built overseas. So certainly hasn’t been without a lot of prodding and proding [sic], the Federal Government to actually take action in South Australia. But I think we’ve got to go back to those workers that are affected today, ensure that there are programs and support for them to transition. There is a two year lead up time for these workers. We need to be working both state and federal governments together to support these workers transition to new jobs.
Matthew Abraham: What new jobs do you reckon they’re going to transition to? You work on a bottling line at Coke.
Amanda Rishworth: Well look, of course we’ve got to be encouraging manufacturing to South Australia. That is- it needs to be…
Matthew Abraham: Well why would anyone- Amanda Rishworth- and we’re getting lots of questions about this, why would anybody come to South Australia and invest here if you can’t guarantee cheap- and we haven’t got cheap power, but at least reliable power?
Amanda Rishworth: Well look, if you’re looking at power right across this country, if you look at New South Wales, at Tomago, a large aluminium manufacturing smelter in the Hunter actually had to load shed and that affected manufacturing in this country. In Queensland there’s been load shedding as well and spot prices have surged very high. So when we’re talking about energy and manufacturing, it is a problem across the country and we do not have a plan from the Federal Government.
Simon Birmingham: Let’s not pretend here that it is not a more acute problem in South Australia. That when I travel the country, I don’t hear business leaders across the rest of the country as anxious and concerned as they are in SA when it comes to the reliability and affordability of energy. Now the Turnbull Government has invested dramatically in South Australia. Our defence industry investments mean that there is far more government investment in job creation activities coming to this state than any other place in the country.
On top of that, just yesterday we announced in terms of the energy debate investment to progress this idea of a pump hydro facility at Cultana which is the type of investment that can make the unstable, unreliable renewable situation we have in SA work better for us, but frankly it’s the Turnbull Government showing leadership here. Where’s Jay Weatherill on something like pump hydro and actually progressing that to make the excessive amount of renewables energy we have in this state work for us rather than work against us.
Matthew Abraham: Okay Nick Xenophon, you’re at the dentist. I know that. Your mouth’s not full of cotton wool …
Nick Xenophon: Although this is, you know, some would say being with you, Matt, is a bit like a root canal.
Matthew Abraham: Exactly.
Nick Xenophon: Yeah. Look basically just to put it bluntly unless we fix up the issues of power reliability and reduce energy costs significantly in this state, we are stuffed. Our power prices are more than double other states. I have business people who tell me they’re going to expand but not here in South Australia where their base is but interstate because power prices are an absolute killer.
Matthew Abraham: Nobody – it is quite depressing hearing this from two of the three of you because the focus has gone away in South Australia from cheap power. No one even believes that they’re going to get cheaper power here. We now have talk of Jay Weatherill, he’s not ruling out buying the Pelican Point peaking gas station, gas-powered turbine there to provide base load power, reliable base load power.
Simon Birmingham: While at the same time yesterday he just re-announced and recommitted to his own 50 per cent renewable energy target.
Matthew Abraham: Amanda Rishworth, is the Federal Labor Party walking away from a 50 per cent renewable target? Pursuing that before you’ve got in place what you do with reliable base load power?
Amanda Rishworth: Well I think firstly what we’ve got to actually look at is where we’ve got to be in the future and actually have a national system and a national plan for energy security in this country. We’ve had four years of the Turnbull Government not talking about this issue at all and then their answer is coal. That’s what they brought into the Parliament, a large chunk of coal. So in terms of where our future is, it is in more reliable, it is in more clean energy sources. And indeed it is disappointing that the Federal Government has ruled out immediately an emissions intensity scheme because that type of scheme, experts have said, would drive down power prices to cheaper, cleaner power and that should be the type of framework we’re dealing with. So Labor is not backing away from the fact that we’ve got a plan …
Matthew Abraham: [Interrupts] So you – your plan – and you remain wedded to the 50 per cent renewable target?
Amanda Rishworth: Well we remain wedded to that as well a signal to the market about investment. One of the big issues that has been uncovered in the Senate inquiry that experts have been talking for a long time is without a lack of plan, without a lack of direction from the Federal Government, there is not investment. And when there’s not investment there isn’t supply. And of course what the industry has been waiting from this government is some sort of indicator about what they should invest in. That’s where we need to get the parameters and the long term plan correct and part of that is an emissions intensity scheme that sends clear signals to the market.
Matthew Abraham: Okay. Nick Xenophon, just finally and we’ll come and give Simon Birmingham a chance to respond as well. Emission – I mean is that – have we lost the plot on that now?
Nick Xenophon: Well …
Matthew Abraham: [Interrupts] Have we almost [indistinct] the practicalities of building generators and buying them?
Nick Xenophon: Well can I just say the emissions intensity scheme brings back vivid memories because back in 2009 when Malcolm Turnbull was Opposition Leader we jointly commissioned, Malcolm and I, jointly commissioned Frontier Economics to come up with an emissions intensity scheme approach. The Liberal Party adopted it back then. The Labor Party said it was a quote mongrel of a scheme, distanced themselves from it. Nine years later it seems that the party that commissioned the Frontier work has walked away from it and the party that was scathing of it has now embraced it. So this is our crazy politics has got in this country.
Matthew Abraham: Finally, Simon Birmingham.
Simon Birmingham: Few quick points. Firstly emissions intensity scheme will only put another price into the energy market. So we shouldn’t pretend that it is somehow going to make electricity cheaper overall.
Nick Xenophon: [Talks over] That’s not right.
Simon Birmingham: It will shift the costs …
Amanda Rishworth: [Talks over] That’s not what the experts say. That’s not what the experts say.
Simon Birmingham: … shift the costs within the market and ultimately drive prices up in a period of time.
Nick Xenophon: [Talks over] No, that’s wrong. That’s wrong.
Simon Birmingham: Secondly we just heard Amanda, we just heard Amanda say very clearly that Labor remains absolutely committed to a 50 per cent renewable energy target federally. That’s a $48 billion cost that will have to be paid for by consumers or business.
Amanda Rishworth: [Talks over] That is not correct.
Simon Birmingham: That isn’t going to help. And lastly I again highlight just yesterday, the Turnbull Government made progress in the next step of trying to make this renewable situation in SA work for us. The pump hydro power storage option at Cultana. It’s real investment, it’s real investment in trying to fix the problem in SA that we really have to get on with addressing.
Matthew Abraham: Okay look, we thank you for coming in Simon Birmingham, Senator Simon Birmingham, Education Minister, for coming in to ABC Adelaide studio. Our Canberra studio has Amanda Rishworth, thank you, Federal Labor MP for Kingston and a frontbencher in the Shorten team and Nick Xenophon, South Australian Senator and leader of the NXT Party, about to go to the dentist. Thank you.
Nick Xenophon: Thanks.