Senator the Hon Mathias Cormann

KIERAN GILBERT: Joining us now for reaction to that and other stories today, the Finance Minister Mathias Cormann. Minister, an end of an era for Australian manufacturing. 

MATHIAS CORMANN: It is the end of an era. It has been coming over a period. The announcement by Ford that they would stop manufacturing was made back in May 2013, when Julia Gillard was still Prime Minister. But having said that, it is the end of an era today. Two-thirds of Ford’s current employees will continue to be employed in Australia. About 1600. In relation to everybody else, our focus is on working with Ford and working with the Victorian Government on helping to transition people into new jobs. 

KIERAN GILBERT: Do you have any regrets on the way the Government has handled this? The former Treasurer, Mr Hockey was accused by Labor of basically daring the automotive giants to leave Australia. 

MATHIAS CORMANN: That is just a political line by Labor. The announcement by Ford was made in May 2013 under the previous Labor government. In fact, two Prime Ministers ago. Julia Gillard was still the Prime Minister. Mitsubishi made a similar decision prior to that. The manufacturer that made a decision on our watch was Holden in South Australia. The reality is that there were certain sustained structural challenges for this industry to be competitive, despite significant taxpayer subsidies over an extended period of time. These decisions were made because there wasn’t a viable future for that type of manufacturing in Australia according to those businesses. Our focus is on making sure that we help impacted employees transition. Our focus is on making sure that we have new opportunities in the future in relation to high end manufacturing in particular, adding value as part of global value chains. That is why we are focussing, for example, through our defence industry plan on providing appropriate opportunities to local high end manufacturing here in Australia. 

KIERAN GILBERT: Now we have seen the banks before that Committee this week, being scrutinised by the House Economics Committee. In New York overnight, the Treasurer arguing a strong case for our banks and the fact that they should not be undermined. That they are a pillar of our economic strength. He says that they have been critical as a shock absorber to our economy particularly through the GFC. 

MATHIAS CORMANN: He is right. If you look at what I have said earlier this week, I said pretty much the same thing. All of us, from the Prime Minister down, have pointed out how important it is for our future economic success for us to have strong and stable, well regulated banks. Yes, when things go wrong, when customers have legitimate grievances with the way banks have dealt with certain issues, these issues need to be addressed. We always have to consider whether the regulatory … interrupted

KIERAN GILBERT: But who is undermining that? The Treasurer warns against undermining. I am just wondering who is undermining it? Isn’t it the banks’ behaviour undermining it?

MATHIAS CORMANN: It is very self evident that the person in Australia that recklessly and irresponsibly in pursuit of a political objective is undermining the banks is Bill Shorten. Because he is running a political campaign. He is not focussed on achieving better outcomes for bank customers with legitimate grievances. He is pursuing a political objective in pursuit of his own political interest, putting at risk a very important pillar of our future economic strength. That is what we pointed out in the course of the election campaign. That is what we have been pointing out ever since. 

KIERAN GILBERT: It doesn’t look like they are being undermined though. They have got multi billion dollar profits. They don’t look like they are very weak. This is just about scrutiny isn’t it of their poor performance in some areas?

MATHIAS CORMANN: The point that we are making is, again, fundamentally it is very important for Australia’s future economic success for us to have strong, stable well regulated banks and we do. The Australian banks performed very well by international standards in the wake of the global financial crisis. To the extent that there are issues and there are issues from time to time, they need to be addressed. To the extent that there are legitimate customer grievances there has got to be a process to ensure that those can be efficiently and effectively dealt with. Our focus is on taking action to address issues and improve regulatory settings, improve the processes available to aggrieved customers. Whereas Bill Shorten’s focus is on running a political campaign, focussed on his political interest, undermining the important and fundamental strength of our banking system. 

KIERAN GILBERT: Your Liberal colleague James Patterson is calling for the national art treasure Blue Poles to be sold off because it is now being valued at $350 million. It was bought during the Whitlam Government for $1.3 million. It has been quite an investment. But surely the Government wouldn’t sell this off?

MATHIAS CORMANN: I like the fact that James Patterson is thinking about how we can strengthen our Budget position. But no, in relation to this particular object, it is a matter for the Board of the National Gallery to determine how they manage their portfolio. I would be the last person to make informed judgements in relation to these matters. We don’t have any plans to sell that particular … interrupted

KIERAN GILBERT: But it is a national treasure, it is an art treasure. It is a ridiculous proposition isn’t it?

MATHIAS CORMANN: It is a national art treasure. I can’t see it being sold. But I don’t criticise James Patterson for one moment for turning his mind to how we can get our Budget into a stronger position for the future. 

KIERAN GILBERT: Okay last question, it relates to the energy council. The states, I spoke to a couple of experts in this field last night in the climate, renewable space, who are saying really the States’ targets need to be the focus if we are going to meet our Paris commitment. 

MATHIAS CORMANN: Our focus needs to be on ensuring that we have energy security. That we have access, secure and reliable access, to affordable energy and we have to focus on achieving our emissions reduction target. The policy settings at a Federal level help us ensure that we can meet our emissions reduction target, including the target that we have committed to in Paris. You would be aware that we are on track to exceed the previously agreed targets based on our current policy settings. It is very important for us to have a coherent policy framework nationally rather than having a number of States trying to go it alone with more aggressive targets that undermine the energy security across Australia and as such our economic performance. 

KIERAN GILBERT: Finance Minister, Mathias Cormann as always appreciate your time this Friday. Thank you.

MATHIAS CORMANN: Always good to talk to you.