Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia
The Hon. Scott Morrison MP
Date: Saturday, 26 September 2020
THE HON STEVEN MARSHALL MP, PREMIER OF SOUTH AUSTRALIA: Well, good morning and welcome to Osborne, it’s a very exciting day. We’ve got the Prime Minister, the Honourable Scott Morrison, with us. We’ve got the Mathias Cormann, the Minister for Finance, with us, Gaby Costigan, who is the chief executive of BAE here in Australia. We’ve also got Andrew Seaton, who’s the managing director of Australian Naval Infrastructure, ANI, we’ve got Craig Lockhart, who is the managing director of ASC Shipbuilding and Commodore Steve Tiffen so everybody’s here and it’s a very exciting day.
First of all, can I say it’s always wonderful to have the Prime Minister back in South Australia. We haven’t seen him since February. He came over then, and he opened our fabulous space agency headquarters here in South Australia. And since then, of course, we’ve been dealing with the coronavirus pandemic. The Prime Minister’s done an outstanding job leading the nation in our response to both the health crisis and the economic crisis that has ensued from the Coronavirus here in Australia. But he’s back now. I’ve got to say a massive thank you to the Prime Minister for his ongoing support, his passion, his belief in South Australia and our aspirations for the future. He’s backed us in terms of developing our skills in South Australia. He’s backed us in terms of developing our infrastructure, $12.9 billion dollars worth of infrastructure here in South Australia. He backs us with the space agency, Lot 14, our city deal. But the Commonwealth Government, has done an outstanding job in backing South Australia, in terms of our defence industry capability.
Now, the coalition government was re-elected in 2013 and they made a couple of absolutely critical decisions for our nation. Number one, to increase defence spending, to two per cent of GDP under the former Labor governments, it had gone down to a level that we hadn’t seen since before World War Two. This left our nation vulnerable. So the Coalition agreed to increase our defence spending to two per cent of GDP. But more than that, they also agreed to recognise the defence industry as a strategic defence capability for our nation and here in South Australia, we’ve been the very happy beneficiaries of these two incredible decisions to protect our nation.
We here are at Osborne at the moment, the most modern shipyard in the world. We are currently inspecting for the very first time the new shipyards that will build the fabulous Hunter class frigates, nine Hunter class frigates to be built right here in South Australia a $45 billion dollar programme and even the sheds here, the four critical sheds that have gone up in record time. This alone is a $530 dollar Commonwealth investment into South Australia and doesn’t it look fantastic. Incredible facilities. The apprentices that we met this morning will be working here. They could have jobs for decades and decades to come on these critically important programmes.
But South Australia’s fortunate with defence beyond the shipbuilding programme. We talked this morning about the frigates programme, but of course, we have the 12 new Attack class submarines we’ll be building here. Currently, we have the two offshore patrol vessels being built by Lurssen on this site. And in addition to that, we have Edinburgh here in South Australia, one of two super bases with incredible intelligence, surveillance, reconnaissance, electronic warfare, work being done there. So we are the defence state. We love having the prime minister here. We also love having Mathias Cormann the Finance Minister here. We know that he will be retiring from the federal parliament and on behalf of the people of South Australia I’d like to acknowledge his extraordinary contribution to the nation. And he has been a great friend of us here in South Australia. He’s been, he was appointed to the cabinet in 2013 as the finance minister. He now is the longest serving finance minister in the history of Australia. He’s a senator from Western Australia since 2007, and the good news is early this month, it was his 50th birthday, so a young guy, a very capable guy, a passionate guy and friend of South Australia, Mathias, sir, congratulations on your outstanding service to the nation. We wish you all the very best for whatever lies ahead.
Now, ladies and gentlemen, I introduce the Prime Minister of Australia.
PRIME MINISTER: Thank you Premier. It’s great to be back in South Australia, as a Sydneysider who flew in to Adelaide last night, I will be the first of many, many who will be coming back to South Australia enjoying everything that South Australia has to offer, whether it’s here in Adelaide or further afield. It’s just a wonderful state to come and visit, and I encourage my fellow sydneysiders to make the trip. And those from the ACT as well now, the Premier has made the decision. It will bring, we estimate, some $800 million dollars almost to the state of South Australia, the decision the Premier has made. So congratulations to you Steven it’s been a great privilege to serve with you on our national cabinet as we’ve dealt with the very significant challenges over the course of this year as we’ve confronted the twin crises of the pandemic, the health pandemic and the pandemic recession, the COVID recession has resulted from the impact of COVID-19 across the country.
This is an exciting day. This wasn’t here several years ago, just over a couple of years ago, wasn’t here. And, you know, when I look around this magnificent facility, the most modern shipyard anywhere in the world, as the Premier has just reminded us, I do see an enormous amount of Australian steel. Which is also great. But what I see in all of this is jobs. I just see so many jobs, these 750 jobs at its peak that were involved in building this magnificent facility. Over half a billion dollars of investment to make it a reality, I also see the jobs as we’ve met many of the new apprentices just starting now. Apprentices like Sabrina, whose father was a welder. And she’s going to be a boilermaker. She’s training to do that right here in this shipyard. And she’ll be building ships in this place for a very long time to come if that’s what she chooses to do.
This is rebirthing South Australia, and there’s a rebirthing going on here in South Australia under the Premier’s leadership, which is exciting to be part of, whether it’s the heavy industry we’re talking about here or it’s indeed the future industries like space where I was last time when I was here. Cyber technology, all of these sorts of things. Welded together with these incredible facilities that will provide jobs and livelihoods for decades to come.
$45 billion on the Hunter class frigates. And that steel starts getting cut in December of this year. I was assured here today. And that’s exciting news. So it’s all about jobs. The way we grow ourselves out of the challenges we have economically is what will determine our future. And you don’t grow unless you build these sorts of facilities. You don’t grow unless you train thousands of workers who will come and be part of this magnificent venture. We’ll have around 2,500 people involved in these projects, thousands of jobs will be created here very, very soon. And these apprentices will come in wave after wave after wave. We haven’t seen this in this country at this scale for a very, very long time. And the fact that it’s happening here in South Australia is tremendously exciting and it’s providing an economic foundation for this state for decades to come. And it’s been achieved through a partnership, a genuine partnership between the Commonwealth government together with the state government. Bringing the people, the skills, we currently have to the JobTrainer programme 15,000 additional training places that have been created for this year alone, to ensure that we’re training people so they can get into jobs that businesses will be creating with the skills that businesses need. Because, yes, we’re going to have a big bill when it comes to dealing with the cost of supporting Australians through this pandemic and the way you pay that bill back is by getting to work, by getting people in jobs, by growing your economy. That’s how you build up. You don’t do it through higher taxes and you don’t do it through taking away the essential services that Australians rely on. You do it by doing this. This is a magnificent achievement. And to all of those who’ve been involved, those who’ve designed it, those who’ve planned it. Those have worked and sweated over each and every every part of this magnificent facility, and what’s underneath it, I’m told there’s more steel under the ground than there is, what we see above us. And just that is a marvel to think about the engineering works that are involved in this.
We make things here in Australia. We made this together, if we can make this nothing can stop us.
And someone who’s been incredibly involved in this project from the outset has been the finance minister, who is the shareholding minister who’s been part of this project. And Mathias and I’ve been involved with this project for a long time, formerly in my role as Treasurer. And of course Mathias always as finance minister, and I’ve got to tell you, it’s terribly exciting to come here, having made those decisions several years ago and then to move into the construction phase and now here to stand and see what’s been achieved and look forward to what’s to come. It really is a great day for Australia and it’s a great day for South Australia and I’ll ask Mathias to make a few comments as well.
SENATOR THE HON MATHIAS CORMANN, MINISTER FOR FINANCE AND LEADER OF THE GOVERNMENT IN THE SENATE: Thank you very much Prime Minister. Thank you very much, Steven, Premier of South Australia for your very kind words.
Today is a moment of genuine personal pride. It was just over three years ago that Christopher Pyne and I put a proposal to our National Security Committee to set up Australian Naval Infrastructure as the body to build and develop this world-class facility. By the end of December 2018 we were in a position to first raise steel. Here we are, less than two years later, having met a very ambitious timetable, ready to hand over what is a world-class facility in which we will build $45 billion worth of ships, the Future Frigates, the Hunter Class Future Frigates. It is an extraordinary achievement.
As the Prime Minister said, 750 jobs at its peak during construction, with more than 25,000 tonnes of steel, more than 85 per cent of which here out of South Australia and 97 per cent of the contracts let to build this facility gone to Australian businesses. This has been a genuine sovereign enterprise. But more importantly, from here on in, more than 2,500 direct jobs here in this facility.
As I reflect on my seven years in the job as Finance Minister, I have had direct responsibilities in relation to the ASC the whole way through. We were able to lift performance at ASC submarine maintenance to the point where they consistently meet and exceed world benchmarks of performance – outstanding work. The Air Warfare Destroyer program was under serious pressure when we came into Government. Towards the end of that program, meeting and exceeding global performance benchmarks.
The decision to pursue the structural separation of ASC into submarine maintenance, shipbuilding and the infrastructure business, which has underpinned projects like this, which will set up South Australia and Australia for decades to come, to successfully deliver one of the most exciting, continuous naval shipbuilding programs in our history.
I have got say, the work between the Commonwealth and the State Government here in South Australia under the leadership of Steven Marshall could not have been better. It has been fantastic to have a government here in South Australia that worked hand in hand with us to make sure that we were able to deliver this for South Australia and for Australia.
It is so exciting to be here. I cannot wait to see the products that will be built and developed by generations of workers here in this facility for decades to come.
Thank you very much, Prime Minister. Thank you, Premier and thank you to everyone involved.
PRIME MINISTER: Hang on, Gabby and then Andrew.
MS GABBY COSTIGAN, CEO OF BAE SYSTEMS AUSTRALIA: Good morning, everybody. Well it’s an absolute pleasure to be here representing my company, BAE Systems Australia. And my team in ASC shipbuilding, as you heard the prime minister say, the premier and the finance minister, this is an incredibly exciting day, not just for South Australia, but for our nation. We received the approval to proceed this week with prototyping for the Hunter Force frigate, which will commence in December this year. So it’s an exciting day for us. And as as the Prime Minister said, this is all about jobs. You know, we have continued throughout the pandemic with business as usual here in South Australia. And I think looking around you, you can see the amazing work that’s been happening. And my team are really excited to kick off, you know, the operational part of this now and build these 9 frigates for our Navy to help protect us and our national interest. Thank you.
PRIME MINISTER: Thanks Gabby, Andrew?
MR ANDREW SEATON, MANAGING DIRECTOR AND CEO AUSTRALIAN NAVAL INFRASTRUCTURE: Good morning all, and thank you for coming down here today. I stand here as as a very proud managing director of Australian Naval Infrastructure, to build great warships you need to have great infrastructure. And three years ago, as the finance minister said, ANI was formed to build the infrastructure here at Osborne. And we have delivered over 1.8 million man hours of work on site. We’ve delivered this yard on schedule and on budget. It’s a fabulous yard. It is, as we’ve already heard, it is probably the best shipyard anywhere in the world. It’s the most sophisticated shipyard with the equipment that we’ve put in here. We’re in the process of handing it over to ASC shipbuilding and we look forward to a long association with them as they build the frigates here in the yard. But we’re not stopping there. We are already underway building the new submarine yard just north of here on an adjacent site. And that submarine yard, again, will create the jobs of the future for a very skilled workforce, building our continuous naval shipbuilding programme. So thank you.
JOURNALIST: Prime Minister can we ask, the submarine maintenance jobs that we’ve been asking for getting on for the best part of a year now, still no answer. The fact that you are here now is that a good sign for the existing Collins class maintenance jobs?
PRIME MINISTER: Well the answer is the same I gave it to you back in February. We’ll make that decision, it’ll be made in the national interest. We have not made that decision as yet. And I want to thank particularly the Premier for the many conversations we’ve had about that, that decision has not yet been made.
JOURNALIST: Why not? What’s the delay?
PRIME MINISTER: Well, we’ve been pretty focused on the COVID crisis over the last 6 months I must say. Last time I was here that was just before that hit. And it’s not a decision that is pressing, it is, there is the works that we need to do right here and now in terms of delivering the naval shipbuilding programme. And that’s what we’re focused on, now. And so we will make that decision. But right now, it is not the priority decision. The priority decision is getting on with the works that we’re doing right here. Right now.
JOURNALIST: Some workers waiting on a decision might say it’s pressing?
PRIME MINISTER: We’ve got 2,500 jobs right here on this project. 2,500 jobs just on this project, about the same again I think it is Mathias when it comes to the build of the subs themselves, there is no shortage of naval shipbuilding work here in South Australia. There is no shortage of a future for jobs in naval shipbuilding here in South Australia. And you can see some of the young people who are just about to embark on a decades long careers here in South Australia, getting the skills that they need to ensure that they will have a tremendous future here in South Australia. Building ships.
JOURNALIST: There were many who thought that you would come bearing gifts today considering the Premier has opened the borders?
PRIME MINISTER: Well, I’m just pleased to be here in South Australia. I told the Premier that when he opened the borders, I’ll be here pretty quick smart because I’ve missed South Australia very much so it’s great to be here. And it’s particularly great to be here for this important milestone in this project. And that is the principal purpose for why we’re here today. But when it comes to the support that the Commonwealth government has provided to South Australia, I mean, this is unprecedented support that any Commonwealth government has given to this state ever. When we think about just the last six months, some almost $5 billion dollars alone has been provided by the Commonwealth government, federal taxpayers, of which that includes South Australians to ensure that South Australians could come through the worst pandemic we’ve seen in this century. Now it’s about $3.3 billion already paid out the door when it comes to JobKeeper support here in South Australia. And about another $1.6 billion, that has gone in to supporting businesses with cash flow support to keep their doors open, to keep their employees into jobs. And then on top of that, there are the many other programmes, whether it’s HomeBuilder or the JobTrainer programme, which has seen 15,000 extra training places this year. So that’s a pretty full basket I think it comes to what the Commonwealth has been doing and will continue to do and alone, our government has already invested in over $9 billion dollars in infrastructure projects here in South Australia. And those projects are happening right now, the North South project, six lanes, that is happening now. So we’re going to keep delivering on the promises that we’d be bringing to South Australia and we’ll keep doing that.
JOURNALIST: Prime Minister, when it comes to borders, as you rightly point out, you’ve wasted no time coming to South Australia.
PRIME MINISTER: Just before we get on to those other issues, I mean, we’ve got Gabby and Andrew here and if there are questions that people would want to raise on this project, or the related projects, very happy to address that. And then I’m very happy to come back to the other issues of the day.
JOURNALIST: Prime Minister, you talk about the importance of defence in our COVID-led recovery. Why is that so important to the national fabric and important for our economic recovery?
PRIME MINISTER: Our economic plan isn’t just about cushioning the blow, which we have done arguably, probably more effectively than any other country in the world today. It’s not just about recovering the jobs which has seen us recover some 760,000 jobs in the last few months as we’ve bounced back and we’re coming back and the majority of those jobs have actually been for women, which we welcome. There’s been a lot of young jobs, youth jobs coming back as part of that. That’s not just the jobs that were lost, but they were the jobs that reduced to zero hours. So the aggregate demand, stimulus and support that we put it through programmes like HomeBuilder and so many others, JobKeeper, that’s what that has been doing. But there’s a third and most important part of our economic plan, and that’s to build for the future. And that is to ensure that we have reliable, affordable energy in Australia to support manufacturing industries, including right here in South Australia. You cannot have a viable manufacturing sector here in the decades ahead unless you are prepared to embrace gas as your transition fuel. I mean, basically you are assigning people out of work if you’re not going to get on the gas when it comes to supporting manufacturing in this country.
So manufacturing is important, defence industries are incredibly important as part of that industrial element of our economy. And we have deliberately put defence industry and our procurement as part of our manufacturing plan in this country, which builds jobs not just now. But jobs, as we’ve seen from the young people who are here today for decades to come. These types of investments and building these capabilities, whether it’s building submarines or building offshore patrol vessels or frigates or advanced, whether it’s in other states like Queensland with vehicles. All of this is building technological and manufacturing, advanced manufacturing capabilities in Australia, which will underpin our income and our jobs and our livelihoods in the future. Industrial relations and infrastructure development, all of these are important parts of the plan, getting access to credit. The changes to insolvency laws, digitising our economy, a huge part of the reform plan we’re working through right now. And that sets Australia up for success into the future. So all of these combined together, we’ve got to cushion the blow. We’ve got to support the recovery and then we’ve got to build for the future. That is our economic plan for jobs.
JOURNALIST: Prime Minister, in allowing, as you’ve just mentioned, credit, allowing for easier loans. Does it also allow for perhaps younger people to rack up debt that they can’t afford?
PRIME MINISTER: No, I don’t believe so. Getting people to fill out phone books worth of applications doesn’t protect them. I know that. I mean, I when I was treasurer, I used to work closely on these issues. What we need is to ensure that banks engage in their business properly, which they will. It’s not in the bank’s interest to make loans to people who can’t afford to pay them back. You’d go broke if you tried to do that. And what we had built up over many years, and the Reserve Bank governor has said it himself. He said, while, these regulations that were introduced years, years ago after the GFC may have been introduced with a noble purpose, all they’ve done at the end of the day is it’s taking too long for young people who want to buy a house and build a house. We’ve got a HomeBuilder programme where we try to support people to build houses. We’ve got a first home loan deposit scheme which is helping thousands upon thousands of young people get their first home. And we’ve clogged the system up with regulations and paperwork and red tape that stops them getting into their home. Now, it’s not just for those who are looking to buy their first home or buy any home or build their first home, or build a home. It’s also about small business getting access to credit. And because unless you keep the arteries of the economy flush with the credit that enables the growth and the employment of people. Then you will not realise the objectives of your [inaudible]. So we think it’s a very responsible decision and it’s been I think it’s been well received, particularly by those who know how many jobs it’s going to create and how many businesses it’s going to support.
JOURNALIST: In terms of the HomeBuilder scheme, anecdotally, a lot of builders are now telling young people and that they can’t guarantee that they’ll get the $25,000 because of the backlog in between signing a contract and that three-month deadline to pour a slab and start construction. Is there any consideration of extending that period?
PRIME MINISTER: Well, right now, the settings are as they are, but we’re watching those things closely. It’s important that we move on these things as quickly as we can. The whole purpose of the HomeBuilder programme was to get projects happening now, not twelve months from now, get them happening now. So we want to keep the pressure on the system to to get those moving as quickly as possible. But we’re also very conscious. We’re listening carefully. And Minister Sukkar who is responsible for the programme as Assistant Treasurer. He’s closely liaising with industry and with state governments in particular, and how they’re planning processes are proceeding, but I mean the HomeBuilder programme has been tremendously successful. It’s an absolute job creator. It’s a job making programme, and it’s also providing that support to the economy to rebuild our economy from where it’s been so devastated by COVID.
JOURNALIST: What, what hope can you give the South Australian public in the upcoming Budget? What can we expect from your Budget to help our economy?
PRIME MINISTER: You can expect us on Tuesday week to continue to step up for Australians in the worst crisis that most of us have seen in our lifetime. Australians know that our government moved quickly and moved significantly. Australia today, as I told the United Nations in my pre-recorded address to the General Assembly. Has managed the combination of crises of the health crisis and the economic crisis better than almost every other country in the world. And that is a testament to the resilience of Australians. But I think it is also a product of the responsive and targeted and proportionate and well-timed support that we’ve provided, in the Budget you can expect that to continue, in the Budget you can expect to see us continue to roll out the plan I talked about before of cushioning that blow, of supporting our our economy and to building it for the future and the jobs that at the end of the day, are most important. Jobs first, that’s what the Budget is all about.
JOURNALIST: Prime Minister you just mentioned your address to the UN, do you think you may have offended China by doubling down on your call for an inquiry into COVID-19?
PRIME MINISTER: No I don’t. I don’t accept that analysis of what I simply said, in fact, I was making the opposite point, what I was simply saying was that our purpose in raising this issue was to ensure for no other reason, that we understand what occurred so we can make sure it doesn’t happen again. That’s just common sense. And 145 countries around the world, including China agree. So I don’t agree with that analysis of how it’s been characterised. I reject it, actually. I think that has been misread. My statement was simply to say that it was the right thing to do. 145 countries agreed with us and I’m pleased that it’s proceeding.
JOURNALIST: Prime Minister, you talk about the borders and how delighted you were to come to South Australia, were you frustrated that it took that long for the borders to be lifted across the country?
PRIME MINISTER: I’m a patient man. And, you know, patience is important when it comes to dealing with crises, and I’ve always respected and Steven knows this, having served with me on the National Cabinet. When we went into this crisis, all the states and territories were pretty much in the same place. We really didn’t know how bad this was going to be. There was a lot of things we didn’t know. And so everyone was starting from the same place. And that means we could move on the various measures that we took together. Now, as time went on, different states moved at different paces and they had different challenges. And we’ve seen, of course, in the worst case situation what has occurred in Victoria. Now, here in South Australia, South Australia was one of the first, if not the first, to move on, leaving people more around their state from outside of their CBDs. . They were the first to move when it came to getting kids back into school. Something the premier and I shared a great passion for in advocating that position. And we continue to this day. But I’ve always respected the states ultimately making the decisions about when it’s right for their state to go to the next step. All I’ve simply asked is when states make those decisions that they do it efficiently. That they explain the reasons for why they’re doing it and they seek to administer it in a way that is done fairly and and doesn’t create any double standards along the way and is obviously rooted in the health advice that should guide those decisions. But you’ve got to balance your economy up with that. And they are judgements which at the micro level the states will make. So I’ll leave them to make them.
JOURNALIST: What do you make of –
PRIME MINISTER: We can do a couple more.
JOURNALIST: What do you make of Dan Andrews’ comments in the hotel inquiry claiming he never received an email that the ADF was willing to help, and denying any responsibility in hiring security guards?
PRIME MINISTER: That that’s just a matter for Victoria. I have one goal in Victoria and that is to help the people of Victoria get back on their feet. And to get their economy opening up again, and to do that safely. And that’s what I’m working with, Premier Andrews to achieve. All of those issues, I know there’s a great deal of interest in them, but I don’t think it helps my commentary on those matters. What helps is me continuing to work with every Premier and chief minister in this state, in this country to ensure that we can get Australia firing on all cylinders. I tell you, South Australia’s firing on all cylinders and it’s great to see. And that’s because of tremendous leadership from Premier Marshall, but I will continue to work with all. It’s not my role to get involved in those matters that are being investigated in Victoria. They have their process. I’ll respect those processes and let them get on with it. I’ll get on with my job, which is to work with everybody, to rebuild the country.
JOURNALIST: Did Premier Andrews throw Jenny Mikakos under a bus?
PRIME MINISTER: I’ll leave that to Victoria. I honestly don’t have any observations on those things.
JOURNALIST: Prime Minister, back to your UN address, you talked about upholding the international law of the sea, why not just call China out on its militarisation of the South China Sea?
PRIME MINISTER: I think Australia has adopted a very consistent position when it comes to the international rule of law. Whether it’s on the law of the sea or otherwise, the point about making a national address to the United Nations General Assembly, it’s an opportunity to reaffirm your nation’s support for all of these key principles, and the way we achieve stability and balance and prosperity in the Indo-Pacific, is ensuring that the rule of law and the partnership of nations that operates, does so within that international rule of law so that’s, that’s exactly the point I was making?
JOURNALIST: Was that comment aimed at China though?
PRIME MINISTER: No.
JOURNALIST: Who was it aimed at?
PRIME MINISTER: It was about reaffirming our support for the international rule of law of the sea.
JOURNALIST: What was the purpose of that reaffirmation?
PRIME MINISTER: Exactly what I just said.
JOURNALIST: Prime Minister, the cash handouts, further cash handout for pensioners is that going to support them enough?
PRIME MINISTER: Well you’d have to tell me what you are referring to. I haven’t made any such announcement.
JOURNALIST: Isn’t there a further cash handout to pensioners later in the year?
PRIME MINISTER: Well, I have not announced that. The Budget is on Tuesday week, tune in. It’s gonna be a great Budget. It’s gonna be a Budget that is going to have the most unprecedented investment in Australia’s future that this country has ever seen. It will be a titanic effort that we’re involved in to ensure this country can get back onto the growth path that we want to be on. And that means we’re going to have to do some very heavy lifting in this Budget. And that comes at a significant cost. But I can assure Australians that particularly the finance minister and I and the Treasurer have been over every dollar and every dollar we’re spending is targeted and it’s proportionate. It’s temporary for those programmes that are designed to be so. And it’s designed to ensure that Australia comes out of the COVID recession in the way we all want it to happen with thousands, indeed millions of jobs.
Thanks very much.