Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia
Date: Sunday, 23 February 2020
KIERAN GILBERT: Let’s go live to Perth now. The Finance Minister Mathias Cormann, Leader of the Government in the Senate joins me. Minister thanks very much for your time. As you heard Andrew Clennell reporting that the Prime Minister questioned the scope around this funding for the fire response. Is that fair enough given the amount of funding we’re talking about or does it basically go against his public statements as some within the NSW Government have said.
MATHIAS CORMANN: It is just not true. I was part of all of the conversations. We were always committed to the fifty-fifty split on the basis as it was announced in late January.
KIERAN GILBERT: The statement as given to Andrew by the Prime Minister’s office was that they were always committed to the arrangement as it existed under Black Saturday. From his information he wanted to scope checked within NSW that it was consistent with Black Saturday. Is that quibbling?
MATHIAS CORMANN: There was absolutely no quibbling. There was a very clear, and there remains a very clear commitment to do whatever needs to be done to properly support the bushfire recovery. We made $2 billion available as part of the bushfire recovery fund as would be aware. There are issues from time to time as you implement relevant arrangements that have to be worked through when there is joint funding between State and Federal governments. But I completely reject the essence of what is being suggested here. Having been part of every single conversation in relation to these matters within the Federal Government I can assure you it is not true.
KIERAN GILBERT: Obviously it got to the point that the New South Wales Premier wasn’t even accepting or taking the Prime Minister’s phone calls. So at the NSW level they probably felt it was true, obviously felt it was true.
MATHIAS CORMANN: Again, the Prime Minister was in constant contact with Premier Berejiklian. There was no interruption what so ever in relation to the engagement between the Federal Government and the State government. I do not know that this is all that helpful quite frankly.
KIERAN GILBERT: Some within the New South Wales Government though, sources that Andrew Clennell has reported this morning, suggesting that if the Prime Minister is questioning the funding model on the one hand but publicly saying that money is not an issue, they’re questioning how all that stacks up.
MATHIAS CORMANN: Kieran, you tell me who is making these statements and I might be able to respond to them. It’s completely impossible to provide a relevant comment in response to alleged anonymous suggestions.
KIERAN GILBERT: Okay. Well let’s move on. Interest free loans for small business, small business up to $500,000, 100 applications have been made, only $200,000 has gone out the door. Is that acceptable? Couldn’t more businesses have been cleared for funds by now?
MATHIAS CORMANN: We have made the relevant funding available for this to be done. It is being done at a State level, using State processes. This is not a matter of blame shifting as Andrew was suggesting there. That is just the practical reality of it. In the end these processes have to work their way through. It is available. It is an avenue that is available to provide support for small business. We would like to see as many small businesses as possible take advantage of this opportunity as quickly as possible.
KIERAN GILBERT: Would you like to see the process sped up?
MATHIAS CORMANN: Of course. We would like to see the process to be administered as efficiently and as effectively possible. It is an opportunity that is available. We would like all of those businesses who would be eligible to be able to take that opportunity up as it is presented.
KIERAN GILBERT: On Friday you said the Government would be planning long-term emissions reduction targets. Will the Government have a specific 2050 target?
MATHIAS CORMANN: Again, what we have said very clearly was that we would never be as reckless and as irresponsible as Anthony Albanese was again on Friday copying the reckless and irresponsible approach by Bill Shorten in the lead up to the last election, where he put forward targets without any costings, without any assessment of the impact on jobs, on electricity prices, even without any assessment of the impact on global emissions. Because imposing a target in Australia that ultimately just shifts emissions to other parts of the world, where emissions would be higher for the same level of economic output, does not help solve the problem that we are wanting to solve, it would just impose a sacrifice on people here in Australia for no environmental benefit whatsoever. What we will be doing and we have said that consistently for some time, we are focused on implementing our 2030 emission reduction targets and the policies that are required to meet and beat that target. But we also will be finalising our approach to our longer term emissions reduction targets in time for COP26 in Glasgow later this year. That is something that we have said for some time.
KIERAN GILBERT: And are you open to a net zero emissions by 2050? Is that a possibility?
MATHIAS CORMANN: Again, there is a body of work to be done. I am not going to make any pronouncements in relation to targets on your show here or on any other show to be frank. Responsibly, there is a body of work to be done. Australia is in a very different situation compared to a number of other countries that are being referenced here. Australia is a net exporter of energy. Producing energy supplies in Australia for export generates emissions in Australia, but can help reduce emissions by significantly more in other parts of the world where that energy is consumed. If we make the wrong decisions here, not only would we be harming the Australian economy, harming Australian workers, we would also be harming the global environment. Because if we make it harder for ourselves, for example, to produce more LNG when we know exporting LNG to places like China and Japan and so on where it displaces more polluting energy sources, helps reduce global emissions, global emissions by more, then that just does not make any sense whatsoever.
KIERAN GILBERT: But we’re talking about net emissions. You’re not ruling out zero net emissions by 2050?
MATHIAS CORMANN: Right now, I am not ruling anything in or ruling anything out. There is a body of work to be done to ensure that our policy commitments are both environmentally effective and economically responsible. Let me tell you, looking at the Labor Party, just because Anthony Albanese and Mark Butler make meaningless pronouncements without telling us how they would achieve what they are committing to, without telling us what the impact on the budget, the economy, on jobs, on living standards, on wages and on global emissions would be, means nothing. Inside the Labor party there is a growing rebellion against this sort of reckless and irresponsible approach by Anthony Albanese and Mark Butler. We have Joel Fitzgibbon and Don Farrell leading the charge in relation to a group demanding a more responsible approach to economic policy. I have not seen Jim Chalmers come out, pressing forward to support this sort of reckless approach that Anthony Albanese and Mark Butler are suggesting here. After the election there was a lot of talk that Labor had learned their lessons. Clearly, they have not learned their lesson. Anthony Albanese, as the Prime Minister said on Friday, he is just Bill Shorten 2.0 when it comes to these things. The same mistakes, the same recklessness and the same disregard for our economic future and our future prosperity.
KIERAN GILBERT: You talk about the costs of this sort of approach. Do you accept, as the CSIRO analysis has argued, that there are benefits of such a target of decarbonising the economy? Do you accept there are benefits of doing that because if we’re talking about the cost component, surely its incumbent upon the Government to accept some of the benefits involved as well? Do you accept the benefits?
MATHIAS CORMANN: We are committed to effective action on climate change. We are not just meeting but beating the emissions reduction targets agreed to in Kyoto in 2020. We are one … interrupted
KIERAN GILBERT: So there are benefits as well?
MATHIAS CORMANN: We are one of only a handful of countries which is beating our emissions reduction targets agreed to in Kyoto. We have a plan and we are on track to meet our emissions reduction targets agreed to in Paris for 2030. We already have about 25 per cent of our… interrupted
KIERAN GILBERT: So it’s not all costs? Do you accept that it’s not all costs?
MATHIAS CORMANN: If I may. We already have 25 per cent of our energy supplies coming from renewable energy and that is going to increase to 50 per cent. We are committed to do the right thing by the environment. But in the end you have to make an overall assessment. You have to make an overall assessment of what the decisions you make, what the impact of the decisions you make will be on global emissions, not just emissions in Australia but global emissions. Shifting emissions to other parts of the world where emissions would be higher, alongside the jobs and the economic activity, that just does not make sense for the environment, it does not make sense for our economy. In the end, overall, you have to make judgements that make sense overall both environmentally and economically.
KIERAN GILBERT: Sure. The point I was making is not so much about the environment, it is about the economy benefits. The CSIRO says that real wages would be 90 per cent higher by 2060 with that net zero emissions. That’s their analysis. Obviously it’s a long way away, it’s a guestimate, really, in terms of longer term planning, but that’s their argument. I’m saying to you do you think there are benefits of decarbonising an economy?
MATHIAS CORMANN: In the end we have to go through these assessments carefully to make sure whatever judgements we make about the future direction beyond 2030, this is over the longer term, that whatever directions we determine will put us on a path that is both environmentally effective and economically responsible. I am not going to predetermine these judgements now. But let me just tell you, when it goes back to the modelling of the Labor carbon pollution reduction scheme, that actually demonstrably showed an expectation of lower wages on the back of what was planned at the time. These are things that have to be carefully considered.
KIERAN GILBERT: Given the impact of the fires and the coronavirus, how is the surplus looking right now?
MATHIAS CORMANN: We have updates twice a year in terms of the fiscal impact of what happens in the economy and in the community, but also the impact of policy decisions made by the Government. The next update is in the Budget on the second Tuesday in May. The coronavirus, the drought, the bushfires and slower global growth, all of these things are having an impact on our economy. But our economy has proven to be remarkably resilient in the face of some of these global and domestic economic challenges and headwinds. We will continue to work our way through these issues. We have forecast a return to surplus for 2019-20 for some time. But, there are a lot of things happening. We will be providing an update in relation to this at the next Budget.
KIERAN GILBERT: And you’re still hopeful of hitting that surplus?
MATHIAS CORMANN: Our most recent forecast was the half-yearly budget update in December. In our half-yearly budget update in December we remained on track to achieve a surplus in 2019-20. Our next update will be on the second Tuesday in May. There is a lot of movement always in between budgets and budget updates. We will be reconciling that in time for the Budget. That is when our next forecast will be put forward.
KIERAN GILBERT: And will the Government be looking to lift the travel ban as soon as you can on Chinese students and tourists and so on? Already, exemptions have been made for Year 11 and Year 12 students. Obviously as Finance Minister you’d be hoping to lift that as soon as possible given the economic impact?
MATHIAS CORMANN: We are guided by expert medical advice from our Commonwealth Chief Medical Officer and also Chief Medical Officers from around the country. The measures that we have taken at our border have proven to be effective in protecting Australians from the impact of the coronavirus here in Australia. We will continue to act on advice and of course where we can and where it is responsible and where it is achievable, while maintaining our commitment to protecting the Australian community, then of course we would do that.
KIERAN GILBERT: How are preparations broadly going for the Budget in terms of the performance of ministers? A number of inexperienced ministers in the Cabinet process. Have you had to crack the whip to get your colleagues moving ahead of the Budget?
MATHIAS CORMANN: The process is a very orderly process. The Government is very experienced when it comes to putting the Budget together and going through the Budget process. All ministers are putting forward their submissions in terms of some of the challenges and opportunities in their respective areas and some of their ideas on how we can adjust policy settings moving forward. There is a whole series of thorough discussions about the best way forward. The decisions that we make will be reflected in the Budget on the second Tuesday in May.
KIERAN GILBERT: Finally, Malcolm Turnbull revealed some private text messages between himself and you, saying you should you ashamed of yourself, that you were treacherous, in his words. He’s already done that, are you worried there’s more to come in his book in April?
MATHIAS CORMANN: This is ancient history. I wish Malcolm well. I really do. He did a good job, a great job as Prime Minister for three years and had the privilege that not many Australians have, to lead our nation over a number of years. I wish him very well for the future.
KIERAN GILBERT: And what about the fact that he released some of those texts. That would have annoyed you?
MATHIAS CORMANN: Ancient history.
KIERAN GILBERT: Minister, appreciate your time. Enjoy your Sunday. We’ll talk to you soon.
MATHIAS CORMANN: Always good to talk to you.