Transcripts → 2017


Sky News - Richo

Senator the Hon Mathias Cormann
Minister for Finance
Deputy Leader of the Government in the Senate
Senator for Western Australia


Date: Wednesday, 1 November 2017

Stephen Parry, Australian economy, energy prices

GRAHAM RICHARDSON: In our Perth studio is our Minister for Finance, Mathias Cormann. G’day Mathias, how are you?

MATHIAS CORMANN: Good to be here.

GRAHAM RICHARDSON: Good on you mate, obviously I can’t go past the Stephen Parry matter. That is the biggest story in the country at the moment, so I wish I wasn’t beginning with it but I will have to. What do you think of all these calls for an audit? Because I note that Eric Abetz has joined the chorus for that this afternoon.

MATHIAS CORMANN: It is a bad situation. It is good that Stephen has declared himself and that he has taken swift action by resigning on the spot. It would be better if … interrupted

GRAHAM RICHARDSON: Mate, wait a minute, 3 months he has had, 3 months to tell us. Don’t tell me he has taken quick action.

MATHIAS CORMANN: As I was about to say, it would have been better if he had done it earlier. But in the end though, there is a clear and well established process under our Constitution and under our laws to deal with these sorts of circumstances. It is a process that has stood the test of time for a very, very long time. It is a process that has worked in relation to the seven that have gone through the High Court so far. So I do not support an audit. I think the very important principle of our democratic system, of our Constitutional arrangements, is the separation of powers between the Executive, the Parliament and the Judiciary. The only authority in Australia that can make an authoritative, conclusive judgement on the eligibility or otherwise, the compliance of Members of Parliament with Section 44 of the Constitution is the High Court. No other process, no other ad-hoc process would have the benefit of leading to a resolution, to a definitive resolution and a satisfactory resolution. 

GRAHAM RICHARDSON: You don’t think that both sides of politics would now be trying to pick each other off, find someone who might be hiding something in the closet about their citizenship?

MATHIAS CORMANN: Graham, what is new? To a degree that happens all the time. That is business as usual. All Members of Parliament, and in particular those in Government, are always subject to scrutiny from those on the other side, are always subject to scrutiny from the media. That is an important feature of our democratic system. It is incumbent on every Federal Member and Senator to comply with the obligations we have under the constitution and to take the appropriate steps if we become aware that we may or are likely to be in breach. As in the end, Senator Parry did and as others that have done before him.  If somebody alleges a breach against an elected Member of Parliament, it is incumbent on those who allege the breach to prove it. Under our legal system, that is a well-established principle that the burden of proof is on those who allege a breach unless you are in a circumstance where there is a confession. Every Member of Parliament, if they become aware that they are in breach ought to take the appropriate steps. But in the end, the established process, the process that people should trust, is the process under our Constitution and under our laws that has stood the test of time for a very, very long time.

GRAHAM RICHARDSON: The hard part is though, at the moment, I wonder how many of our citizens really do trust our Parliament? I mean it does look awfully messy at the moment, you would have to concede that.

MATHIAS CORMANN: If you look at the history of Australia and I am sure that you would be aware of periods in the political history of Australia that you have been involved in, in the past, there have been periods that have been perceived to be more involved than others. Our Constitution has stood the test of time. The best way to ensure that the Australian people can have confidence is by scrupulously complying with the processes and the principles underpinning our Constitution and the relevant laws enacted by Parliament to give effect to it. 

GRAHAM RICHARDSON: As I wrote the other day though, the only time I have seen the situation as bad as this was with Whitlam and in the end he got punished very severely at the ballot box and I think you blokes are heading for a fair old hiding when the next election comes. But I digress.

MATHIAS CORMANN: Again, what you spell out there is also an important principle of our democratic system. In the end, every three years, the Australian Government and the Parliament as a whole has to report back to the Australian people. We have to report on our performance and we have to report on our plans for the future, provide our assessment of what the alternative might mean and people will form a judgement at that point in time as to whether they want us to continue or they want to give someone else a go. But the point is, all of these processes are clearly set out, clearly spelled out under our Constitution. They are working. I would argue that they have worked in relation to the seven former colleagues who have gone through the High Court process in recent times.

GRAHAM RICHARDSON: I want to turn to your day job if we can and have a look at the economy. 


GRAHAM RICHARDSON: Where are we going here in this country when we can’t get any wage growth, we have had a prolonged period of historically low interest rates and yet investment is not leaping ahead as the way we hoped it would do. What else can we do?

MATHIAS CORMANN: A couple of things, firstly we have gone through a period where there has been much lower global economic growth. That is now improving. The global growth outlook is improving and that is good for the Australian economy. We have just completed our twenty-sixth year of continuous growth. Growth has been stronger in 2016-17 than what we had forecast at Budget time. Employment growth has been stronger than what we forecast at Budget time. In fact it was twice, nearly twice as strong at 1.9 per cent than we forecast at the Budget earlier this year. In fact, our unemployment rate at 5.5 per cent is well below where people in the past had anticipated that it would be. So it is not all bad news. The global economic growth outlook is improving. The Government is pursuing an ambitious pro growth agenda across a whole range of public policy areas, whether that is a more growth friendly tax system, bringing down the corporate tax to a more internationally competitive level. Whether it is pursuing an ambitious free trade agenda, giving our exporting businesses better access to key markets around the world so they can sell more Australian products and services. In the end, if we put our policy settings in a place where business has the best possible opportunity to be successful and profitable, the more successful and the more profitable businesses can be the more Australians they can hire and the more they can pay them. In the end, that is why we need to ensure that we do pass the business tax cut down do twenty-five per cent so that Australian businesses across Australia can have the opportunity to be more successful, more profitable, and can hire more Australians and pay them better wages. That is a core part of our economic growth agenda. 

GRAHAM RICHARDSON: Part of the economic agenda is going to have to be to do something about energy prices, obviously, because that is I think the biggest single issue in this country. And it seems to me that if you come up with a plan to say to the average punter out there, look in three years time we are going to reduce your bill, the punter is going to say but how much does it go up in the next three years and does that reduction actually change anything for me now. Can’t you come up with a plan that can do something faster than that?

MATHIAS CORMANN: We are looking right across the board for policy measures. We have already taken steps, for example in terms of increasing the supply of gas into the domestic market, that are already having an impact on wholesale/retail prices which will flow through in terms of electricity prices overall. So by the Prime Minister bringing together the relevant east coast gas exporters, gas producing businesses and convincing them to increase the supply of gas into the domestic market. Increased supply will lead to lower prices, all other things being equal. So there are things that we are doing in the short term. But we also need to ensure that we have our policy settings right for the medium to long term, so that we can attract more investment into additional generation of energy. Because, in the end, you are right, we are an open trading economy, we need to be internationally competitive.  Having access to reliable and affordable, internationally competitively priced energy supply is an important part of our economic success into the future. It is an important foundation for our economic success into the future. But we have to do all of it. We have to look at what we can do sensibly in the short term. But we have also to make sure that the policy settings over the medium to longer term are such that we can attract more investment into increased generation and supply of energy. 

GRAHAM RICHARDSON: Can you lead the way by doing something to fund or guarantee a coal-fired power station. The banks aren’t going to do it, they are all terrified of the Greens and some of these almost anarchist groups who are in tune with the Greens. And it seems to me obviously that we are going to need at least one more big one, maybe two. But if the Government doesn’t do it, no one will.

MATHIAS CORMANN: The first point is that coal will continue to be an important part of our energy mix for a very long time to come. The policy framework that we are putting forward through the National Energy Guarantee is technology and energy source neutral, it is agnostic. So there will be opportunity for private investors to invest in any type of energy generation including coal fired power generation with more certainty around policy settings over the medium to long term. But the first point I think is that we need to look at all of those coal fired power stations that are currently in operation that are destined for closure in the not too distant future and do everything we can to ensure that we extend their life as much as we can in a sensible fashion. So that we do not have more closures in the same way as the closure of Hazelwood occurred. Beyond that in terms of what the Commonwealth Government might do beyond that, I think it is premature to speculate on this. The prime responsibility when it comes to investment in energy generation at the level that you talk about is at the State level. We are certainly very open to work with any State Government on sensible proposals to increase the supply of energy and to help put downward pressure on electricity prices and make sure the lights stay on. 

GRAHAM RICHARDSON: Last question on politics, 22 losing Newspolls in a row. 30 is approaching. When it gets to 30 what do you do? Nothing? Is it going to stay the same?

MATHIAS CORMANN: The next election is due towards the end of June 2019 in the ordinary course of events. Right now we are behind. You are a student of politics. You would have seen at various times whether it be the Hawke or Keating Governments of indeed the Howard Government having being behind and indeed even further behind then we are at this point of the cycle. We have got work to do. There is clearly a level of concern about the performance of the Government, so we have to work harder. We have very clearly got to spell out what we are working to achieve in terms of putting the economy on a stronger foundation and trajectory for the future and what the risks are with the alternative. What I would say, given everything that has been going on, if I was Labor and Bill Shorten, I would take no comfort from a 54-46 two party preferred position. I would actually be concerned as to why they are not in a stronger position if I was Bill Shorten and the Labor party.  

GRAHAM RICHARDSON: If I were you though I wouldn’t be too happy with 46 either, that is a disaster, just around the corner and you know that. At 54-46 you lose 20 seats …interrupted

MATHIAS CORMANN: It is not just around the corner, that is the point. We have got work to do. When we go to the next election, whenever that is and it is due towards the end of June 2019, we will put our track record before the Australian people, we will put our plan for the economy and jobs for the future before the Australian people. We will point out why Bill Shorten’s socialist agenda to increase the tax burden on the economy, to make it harder for business to be successful will lead to less investment, fewer jobs and lower wages. In the end the Australian people will form a judgment. As you know when you get closer to a Federal Election, the polls always tighten. There are lots of conversations yet to be had. We have our work cut out. That is right. Bill Shorten is already measuring the curtains. He is convinced he is already in the Lodge. The Australian people have a lot of thinking to do between now and then. 

GRAHAM RICHARDSON: Indeed they do. Mathias Cormann I know it has been difficult for you to do this, so I thank you very, very much for your time. 

MATHIAS CORMANN: Always good to talk to you Graham.

GRAHAM RICHARDSON: Good on you Mathias.