Senator the Hon Mathias Cormann

ALAN JONES: We are feeling very virtuous on the program this morning because we have actually found someone in Government in Canberra who is not frightened to talk to this program. We have on the line the 47 year old acting Prime Minister, Senator from Western Australia Mathias Cormann, who has been the acting Prime Minister since 2:00 PM yesterday. Belgian born, he is on the line in our studio in Canberra. Mathias Cormann, good morning.

MATHIAS CORMANN: Good Morning Alan and good morning to your listeners.            

ALAN JONES: Acting Prime Minister aye. Who would have thought? Who would have thought? It has a ring about it hasn’t it?

MATHIAS CORMANN: It is not something that you can plan for. It is what it is and I will give it my absolute best. 

ALAN JONES: It is what it is. There you are. I am not going to bother you or my listeners with this unseemly squabble between the leaders of Government, Malcolm Turnbull and Barnaby Joyce. But if I could just get an opinion from you and cite somebody like Piers Ackerman . Now Piers Ackerman is a conservative media writer to his bootstraps. He would be the last person who would be wanting Bill Shorten in the lodge. But in relation to the public excoriation and humiliation of Barnaby Joyce by Malcolm Turnbull, Piers Ackerman  wrote that the virtue signalling, sanctimonious preaching from Turnbull was over the top. Nauseating actually and undoubtedly designed to play to the frenzied feminists who have weaponised the Me Too crusade since it emerged in the wake of the Harvey Weinstein scandal late last year. Turnbull has pandered again to the politics of the soft left as he scrambles to ascend to the moral high ground. Were it not for the Nationals and their conservative values during the last election and the support those values had in regional electorates, there would be no Turnbull Government. The Liberal Party since Turnbull white anted Tony Abbott has moved as relentlessly toward the centre left as the Labor Party has moved toward the far left occupied by the Greens. Do you understand those sentiments?

MATHIAS CORMANN: I read Piers Ackerman  on a regular basis and he has got very strong views. That is the beautiful part of being in a democracy. He can put those views and readers can form their own judgements. In relation to the topic at hand, the Prime Minister clearly has very strong views. He has expressed those views. He expects very high standards from his Ministers. He has also made that very clear. In relation to Barnaby, Barnaby is a very successful, very senior politician. He is a very significant national political figure who has made a significant contribution for many years and I would expect him to make a significant contribution for some time to come. He has had some deeply personal matters, which have spilled over into his professional life. That has meant that he has made a decision to take some leave in order to put some order in all of that and I think that is appropriate. From the Government’s point of view, our job is to focus on the Australian people. Our job is to focus on securing more jobs and higher wages and making sure that our country is safe and secure…interrupted.              

ALAN JONES: If I could just interrupt you there and this is to your great credit. You do this a thousand times a week. You are constantly focusing, but there is a dim behind you that sort of drowns all of that out. On one of those issues, the polls, you cannot ignore these polls and people are absolutely terrified that Bill Shorten has got his key in the door of the Lodge. Now if you just take energy policy, now I know the other mob are taking about 50 per cent renewable energy which is driving everybody insane. But none the less, the Coalition is still about Paris and still about renewables and subsidising the billions of dollars. Now I made the point the other day and if I could get a comment from you, China’s increase in electricity from fossil fuels last year, its increase was greater than our total electricity production for the entire year. So the additional generation of electricity from fossil fuels, mostly of course our coal which has been exported to them. So if we close down every coal fire power station in the nation and went back living in the stone age and so on, we would make one iota of difference to the world’s climate because china is increasing its energy production from fossil fuels by an extent greater than anything saved by Australia. When are we going to sort of say that this whole thing is costing, you are talking about the economy, it is costing the economy enormously. Energy prices are going through the roof.

MATHIAS CORMANN: We want energy prices to be lower and we want access to energy to be reliable. We want to do so in a way that is environmentally as efficient as it can be.  You are quite right, historically for Australia having access to reliable, cheap energy was a very important part of our economic success. It was a very important part of our international competitiveness. The problem is that if we do not get our energy policy settings right we will struggle to attract investment which needs to have a return on its investment over thirty, forty years.                   

ALAN JONES: Correct, correct. But do think Mathias they are right, those settings are right? I mean Malcolm Turnbull and all this lot are going over to America. I mean since 2008, before Rudd introduced this ridiculous renewable energy target, electricity prices in Australia were on a par with those in America. Well since then, 2008, American electricity prices have declined 5.8 per cent. Our electricity prices have gone up 100 per cent. I mean, you are right but businesses are closing Mathias, because of electricity prices.

MATHIAS CORMANN: What the Prime Minister has done over the last year or two is provide very strong leadership nationally in the context of what was a very disjointed and ad hoc energy policy framework at a state level. You have got states like South Australia which excessively pursued reliance on renewable energy without focusing sufficiently on the stability of the system without focusing sufficiently on price implications…interrupted.

ALAN JONES: But you are still talking Paris. You are still talking Paris. You are still talking 30 per cent renewable energy. I use the analogy Mathias here, you and I are both bakers….interrupted.

MATHIAS CORMANN: We are not talking 50 per cent renewable energy.         

ALAN JONES: I said 30.

MATHIAS CORMANN: We are essentially taking a technology agnostic approach. What we are saying is we need to maximise the level of investment in new energy generation so that we can bring prices down and we can ensure there is stable and reliable access to energy supply…interrupted.                   

ALAN JONES: But you are not doing that you see. If I could just say to you, I use the analogy on this program, you and I are both bakers. We are both making bread, we are both making pastry, we are both making cakes. I think I am going to make a quid here and someone says to me, hang on, you are not going to make a quid because that Mathias Cormann, the baker over there, he is being subsidised by the Government by millions and millions of dollars. Now change the analogy and call it renewable energy verses coal fired power. Here is renewable energy getting billions and billions of dollars from your Government. So it is not viable to put money into coal fired power. You have then got banks who are not prepared to lend to people in coal fired power. So we have got the greatest reserves of energy in the world and the highest electricity prices. Haven’t we got to break that nexus?

MATHIAS CORMANN: Indeed and we are at the tail end of years of policy failure when it comes to energy. The National Energy Guarantee which is the framework that the Turnbull Government is pursuing. The efforts to boost the supply of gas into the domestic market. All of that is designed to increase energy security and to bring prices down. In the end, unless we can give investors confidence that the policy settings have stability over an extended period, when I say extended period I am talking 30 or 40 years, they will not invest in this generation...interrupted. 

ALAN JONES: We want something now Mathias.

MATHIAS CORMANN: …And we are doing a lot of things now...interrupted.

ALAN JONES: But 80 per cent of our gas, 80 per cent of our gas is exported. I mean, this is our problem and then we say “oh well, if you want it in business X, your gas, you are going to have to pay the international price.” It our stuff…interrupted.

MATHIAS CORMANN: And the Prime Minister sat the gas exporters on the east coast down and he told them that they needed to increase the supply of gas into the domestic market…interrupted.        

ALAN JONES: But do we have a gas reservation policy?  My old man was a dairy farmer Mathias and every morning my dad would say “how much milk does you Mum want for today? Go and find out.” So you would milk the cows. You would keep for yourself what you wanted and the rest could go to the factory. Why don’t we have a gas reservation policy like Canada, like America, where we keep the gas we need and we get a very, very cheap and competitive price? 

MATHIAS CORMANN: We need to get the balance right. We need to ensure that we get sufficient supply of gas into the domestic market and the Prime Minister is taking steps to ensure that happens. But we also need to attract billions and billions of dollars in capital investment to increase the production of gas in the first place. We have to be very careful in how we manage all of this because if we get it wrong, investment will not come, increased production will not come, and that would drive prices up which is precisely what we don’t want... interrupted.

ALAN JONES: But how can you get it wrong Mathias? We have stacks of coal. Stacks of coal. We are the greatest, we are the biggest exporter of energy in the world. Stacks of coal and we cannot get a Government to say “we want people to build coal fired power stations. We can have high efficiency, low emission coal fired power stations and this is going to be there source of our cheap energy, we’re not going to lose that advantage.” We are subsidising billions of dollars on renewable energy. 

MATHIAS CORMANN: There is as far as I am aware there is no private investor prepared to invest in a new coal fired power station…interrupted.

ALAN JONES: No. No. Why? Because the other mob are being subsidised. Renewables are being subsidised Mathias.

MATHIAS CORMANN: They are making judgements on what they believe the investment climate is going to be over the next 30 or 40 years.                                              

ALAN JONES: But if you take my bakery I can’t make a quid making bread if the Government is subsidising your bread making, I can’t make a quid.

MATHIAS CORMANN: We want to make sure that the policy framework is entirely technology neutral. That the energy supply to Australians is going to be cheaper into the future, more reliable, more stable and that is what our entire focus is all about. 

ALAN JONES: Okay, now look I know you are belting the drum, and good on you, which I think is as plain as the nose on your face. My only criticism of you on company tax is I think you can ever go lower. Is the problem though not just the Senate and well done because what you are doing is you are sitting down and talking to these people. I noticed David Leyonhjelm saying, “well, I only have one problem, I think the low rate should be 20 per cent company tax.” But is the problem that whatever expenditure is going through the roof, it is very difficult to be able to afford the kind of personal and company tax relief that we need?

MATHIAS CORMANN: Well expenditure growth is the lowest it has been in decades. It is running at just about 1.9 per cent above inflation year on year, which is lower than what it was during the period of the Howard Government just to put it into perspective. But the problem with getting our business tax cuts through the Parliament is Bill Shorten. He has taken a reckless and irresponsible approach. He knows in his heart of hearts that business tax cuts are what Australia needs if you want to secure more jobs and higher wages…interrupted.                

ALAN JONES: No doubt, no doubt.

MATHIAS CORMANN: …Yet he is taking a crass, political opportunistic approach. He seems to think it is fun to torpedo the Government’s policy priorities in…interrupted.                                         

ALAN JONES: But that is why we have got to turn these polls around. You have to turn these polls around or the bloke is in the Lodge.  

MATHIAS CORMANN: That is why we need to continue to make the case that families around Australia, working families around Australia, need the Australian Senate to pass those business tax cuts, because we compete for investment around the world. If we want to create new jobs, if we want to create well paid jobs, secure jobs, if we want Australians today and in the future to have good careers in Australia, we need to ensure that the businesses that create those jobs and pay those wages have the best possible opportunity to be successful and profitable future.

ALAN JONES: You are 1000 per cent correct. I do not think that is even arguable. But, everyone in the Government now seems to jump down Tony Abbott’s throat every time he promotes a sensible idea. He has made the point yesterday, he said, “there is something fundamentally wrong when a country with the world’s largest readily available reserves of coal, gas and uranium has some of the world’s highest energy prices. When a country with so much space has big city property prices rivalling those of London and Hong Kong. When some of the world’s best funded schools have test results on par with Kazakhstan.” Those are issues that are biting out there in the electorate. Now that he talked about immigration, now you just made that point about the economy. Here you have got, it used to be about 110,000 net to mid-2006, then it went to 220,000 net, it peaked at 300,000 under Rudd, these are the highest figures in our history and we are increasing our population by the size of the city of Adelaide. Coming to your economy, if you put more and more people out there, then you are going to depress wages, you are going to increase the price of housing. Why doesn’t someone sensibly look at a population policy when you have streets clogged, infrastructure cannot manage, we cannot house our kids in schools, we have to build schools to accommodate them. There is a problem with immigration and the rate of immigration, not immigration per se. Isn’t this worthy of a debate? 

MATHIAS CORMANN: Increasing the size of the population by itself also increases the size of the domestic economy. So every migrant that comes to Australia, as well as making an economic contribution goes to shop in the local shop which helps that shop be more successful and hire more people. They pay taxes and help fund our health and social welfare services and the like. Now, the key with immigration is to attract the right people with the right skills with the right attitude, preferably young people. We have an aging population in Australia and if we do not attract young, appropriately skilled migrants with the right attitude, then the aging of the population would be a drag on growth, it would make us less successful moving forward, it would make it harder to pay for all of the health and social services that Australians rightly expect…interrupted.

ALAN JONES: But 58 per cent of these people are on welfare after ten years. 58 per cent are on welfare after ten years.

MATHIAS CORMANN: I am not sure where those figures come from. What I would say to you is that generations of migrants throughout the history of Australia have made a significant contribution to our economic development…interrupted.

ALAN JONES: We know that, no one is denying that.

MATHIAS CORMANN: … and I believe that migrants will continue to be able to make a significant contribution to our future success.

ALAN JONES: I think the public out there listening to you are saying, “when you are increasing our population by the size of the city of Adelaide and we don’t have the infrastructure or the schools or the jobs to accommodate all of this, Governments have got to start listening.” That is what the public are saying. That is what my correspondence says.  

MATHIAS CORMANN: The migrant intake today is lower than what it was at its peak and that is because the demand for skilled migrants is less than what it was. So we have to calibrate that appropriately and under our current system that is what happens as a matter of course. I do not believe it is appropriate to make an arbitrary political decision picking a figure out of the air and saying we should cut our migration intake.           

ALAN JONES: We are not picking it out of the air. Look, you have to go and I have to go, but just one other thing, we do not have time to discuss it. You are in charge of this electoral funding and disclosure reform bill and you have the carriage of that. I would love to be to be able to talk to you about that, that is worrying a lot of people. I just think that the bill needs to be reviewed and rewritten.

MATHIAS CORMANN: I am very happy to talk to you about that.

ALAN JONES: Well let us try and do that next week, could we? We will be in touch with you and I really appreciate your time. It helps when we can talk to people about these issues across Australia. 

MATHIAS CORMANN: Thank you Alan.