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  Interview: Penny Wong July 20, 2008  Watch our reportThis week, political editor Laurie Oakes talks to the Minister for Climate Change and the Environment, Penny Wong, about the Rudd government's emissions trading scheme. LO: Senator, welcome to the program. PW: Thanks. LO: Before we get into climate change, Alexander Downer is gone; Mark Vaile's announced that he's going. Would Labor breathe a sigh of relief if Peter Costello followed them out of Parliament? PW: Well, I think the issue here is we obviously have a number of by-elections on the book and it's really up to Dr Nelson to try and ensure that the taxpayer is least disadvantaged by this and that the by-elections occur at the same time. Obviously ultimately it's a matter for Mr Costello whether he chooses to resign soon or sooner or later. LO: But does Labor fear him? Do you fear he will stay on and assume the leadership? PW: Oh, look, I think leadership issues are a matter for the Liberal Party and obviously they have a few hats which are apparently still in the ring, but that's really a matter for them. Our focus is on putting forward our policy agenda to the Australian people. LO: Surely it's a matter for you as well. I mean, if the Liberals had a good leader, you'd be under more threat. Do you think Peter Costello would be a greater threat than Malcolm Turnbull or Brendan Nelson? PW: Look, I think, Laurie, I'll leave the assessment of who would be a better Liberal leader to the Liberal Party and to the commontariat. It seems to me there are a few hats in the ring but that's a matter for them and a matter for them to determine. LO: OK, well, the burning issue, climate change. Why did you release your green paper to coincide with the Pope's visit? Were you trying to distract people's attention from the bad news? PW: Well, look to be honest, that certainly wasn't top of mind, Laurie, when we set the date. At the beginning of the year, I laid out a three-stage consultation process. The first was prior to the green paper, a discussion with key stakeholders, including industry as well as NGOs, a lot of dialogue with peak industry bodies, leading up to the green paper and then, of course, what we've also indicated is there'll be a third phase, after the green paper consultation at the end of the year, when we release a white paper, so our thinking was very much driven by the timetable of ensuring that we did get the green paper out on key design aspects. LO: But the date of the Pope's visit has been known for a couple of years. It looks very much as though you wanted it to be obscure. I mean,you must have known there'd be all the hoopla around the Pope's visit and if you'd really wanted people to focus on your green paper, you would have done it at another time? PW: Well, we're talking about a number of months of consultation, until September, and then obviously we've still got economic modelling to come. So my point is, Laurie, that really we were much driven by the timetable I'd set out earlier in the year and the need to get the green paper out so that stakeholders, such as business, could consider the design proposals in that, and that's what we've done. LO: You weren't cynically hiding behind the Pope? One newspaper yesterday had a brilliant headline calling it "a holy smokescreen". PW: No. As I said, we were very much focused on ensuring that industry had sufficient time for consultation on this issue and it's consistent with the broad timetable I laid out at the beginning of the year. LO: Wouldn't it have be better to do it next week when voters could concentrate on it, wouldn't be distracted. PW: Well, perhaps a couple of weeks down the track people might have said that we haven't given people enough time on it, so we were very conscious of the need to ensure good consultation and that's why we've put it out and enabled industry, stakeholders and the community to put input into what is a very important decision for the Australian people and the Australian community. LO: Now, I assume we can expect a major advertising campaign to quote "explain this to voters"? PW: Well, we actually, on this issue, agree with Dr Nelson who said earlier this month that this scheme was something that the Australian people did need to have explained clearly to them, and he contemplated himself the possibility of an advertising campaign. We agree with him. Yes, we do intend to undertake appropriate advertising on this issue, a public information campaign. I'll be very clear about that. Senator Faulkner has released, as you know, the guidelines associated with government advertising. This campaign will comply with those guidelines. LO: And how expensive will it be? Are we looking at another unchain my heart kind of campaign, another WorkChoices campaign? How will you deal with it? PW: We certainly won't be spending the sort of money that we saw the Howard Government spend in the last couple of years of their terms of office where we saw hundreds of millions of dollars spent on the campaign for WorkChoices. LO: And when will it occur? Will we get the ads soon or are you going to wait until closer to the election? PW: No, I'd anticipate you'd see advertising fairly soon. The purpose of it frankly, is to ensure that people understand why we're doing this and what's in the green paper and give them the opportunity to respond to it. We do actually want the community to engage very closely with this issue. LO: You've promised full compensation for pensioners, welfare recipients and for low-income families earning below $53,000, I think, but you've made no such commitment to everybody else. How much - how far out of pocket will middle-income families be? To what extent will you compensate them? PW: The first point I would make here, Laurie, is we have been upfront, that there is no such thing as a cost-free reform. This is hard economic reform. This is about meeting a very significant challenge, the challenge of climate change which, as you know, has substantial economic costs. This is about positioning Australia now for the future, both in terms of climate change and its future economic prosperity. So we're very focused on that. In terms of the actual cost impact, that's part of what the Treasury is undertaking at the moment with the modelling which will come out later in the year, and we have said that we will be, as a commitment, we would be compensating or assisting pensioners and low-income households, pensioners, seniors and carers... LO: But it's the aspirational voter, the people on more than those basic incomes who put you into office. Now, how much are they going to suffer from this plan? PW: Well, as you know, the actual price impact of this, is something that still needs to be worked through. We'll be very mindful of that and the commitment we've given is that we will assist those households between around about $55,000 and $150,000, assist them in meeting the cost of the scheme. In addition, we've proposed an offset on fuel taxes to cushion the impact of any impact on petrol prices. We're very conscious of the impact on families. LO: But you're being coy about the fuel tax offset, too, aren't you? You won't say what will happen at the end of the first three years. Will the offset end at that point? PW: Well, Laurie, we are giving an indication of our policy position five years ahead of time. That's a fairly long period, as you know. What we've said is we'll have the offset on a cent-for-cent basis for the first three years, we'll adjust it periodically to ensure its adequacy. At the conclusion of the three years, whatever has been the reduction in fuel tax will remain at that point... LO: But it looks though - it looks as though you've got this in place just until after the next election. PW: Well, no... LO: No guarantee after that. PW: Well, I think what we've said is that we will review it at that point and the Australian people will know at that point what our approach will be. Look, the logic of this is quite clear. We know fuel prices have gone up very substantially since the beginning of the year - in excess of 35 cents on average. We recognise that's been a significant issue for many Australian families and for Australian motorists. So what we've said is, look, we will offset this, upfront for the first three years. and we'll review it at the conclusion of that three-year period. LO: It's been - a lot has been said about compensating individuals, compensating big business, but presuming a lot of smaller businesses will be affected, have you got any plan in place to help them? PW: Look, that's a very good point and we're very mindful as a government of the impact on small and medium enterprises; small business is obviously a very important part of the economy, so what we have proposed is a climate change action fund and specifically part of the remit of that fund is to focus assistance and support on small and medium enterprises on issues such as energy efficiency and how to finance the sort of capital investment to reduce energy use that they will need. We're very conscious of this. I just remind again that what we have committed to is that every cent we raise through this scheme will be invested back into households and business to enable them to prepare for a cleaner, greener economy, for cleaner energy usage as well. LO: So you're saying you'll give some sort of business anyway upfront payments to help the burden to cleaner energy? PW: We want to talk to small business and its representatives about how best to structure this assistance. Certainly, energy efficiency measures are front of mind because that's probably the area where we can get the most savings for small and medium enterprises upfront. I had a discussion with the Australian Chamber of Commerce and Industry in Brisbane this week about this issue, certainly ARG are interested in this as well and we want to work with small and medium enterprises to work through what is the best way to deliver that assistance. LO: Now, a number of people have said and in fact I've written that I can't see much difference between your green paper and the Shergold Report that was John Howard's policy. Where are the significant differences? PW: Well, I'm sure you and I could sit down, Laurie and go through the two reports ... LO: Just give me one or two... PW: But we have always said we will build on the work that Prime Minister Howard's taskforce undertook. LO: So no real difference? PW: We clearly have a lot more detail, certainly on household compensation arrangements, certainly the detail of industry assistance... LO: I wonder though why the work had to be done again then if all you're doing really is picking up John Howard's policy and putting in a bit more detail, why did we waste a year? PW: Well, in terms of wasting time frankly, Laurie, that we saw 12 years under the previous government where very little got done but we've said we would build on not only Prime Minister Howard's task group force but also on the states who obviously did a fair bit of work on emissions trading before - prior to the election of the Rudd Government, so we will build on that work. But the green paper is a far more comprehensive set of proposals, far more detail, particularly on the assistance to business, on the way in which certain sectors of industry are treated and assistance to households, it's a very comprehensive set of proposals out there for consultation. LO: Does the fact that you just lifted the Howard policy mean that you should be able to get Coalition support to get it through the Senate? PW: Well, it's certainly been interesting how many positions the Liberal Opposition has had over the last week on this issue. I'm not sure whether Dr Nelson is still opposing it, he did initially. Mr Turnbull's on the fence and Mr Hunt has taken the view that it's his report. We certainly would call on the Liberal Opposition to approach this in an economically responsible fashion. Certainly our view is when this does get to the Senate, the Australian people will not take kindly to the Liberal Opposition playing short-term political games with an issue which is so important to Australia's future. LO: Before we finish, I want to ask you about the Murray-Darling Basin. I gather there's more bad news coming out today, some announcement about the state of the river. Can you tell us what that is? PW: What we will see today is the release of a report from the contingency group, the senior officials group which essentially was set up by first ministers, the Prime Minister and Premiers under the previous government and has continued and what it will tell us, yet again, is that we are in real trouble in the Murray-Darling Basin. We've had very low inflows, we've had a very dry June and the focus absolutely has to be critical human needs, that is the needs of the million-plus people who rely on the basin for drinking water. It just reminds us, yet again, the way in which this country, Australia, is particularly vulnerable to climate change. LO: It also reminds us that we're not doing enough about it. At the recent meeting of Australian Governments, Premier and the Prime Minister, the Victorian Premier, John Brumby, scuttled your plan to lift the cap on water trades to boost the flow of the Murray, why won't the Government get serious and take over the powers, do this itself? PW: We are absolutely serious about comprehensive reform in the Murray-Darling Basin, Laurie, that's why we have for the first time in Australia's history, an agreement with the states to manage this basin as a basin. LO: But that recent COAG showed that it's not happening. Do you agree that you have the powers to do this on your own, if you want to, if you have the will? PW: Well no, look, the Water Act.... LO: You don't have the powers.... PW: The Water Act is in place. We're implementing the establishment of the Murray-Darling Basin Authority. There are still issues we have to work through with the states. We were pleased that at COAG all the Premiers did set as an ambition the increase in the percentage of water that can be bought, but I do want to make this point, we, at the moment, in the Murray-Darling Basin, are facing problems which are about extremely low rainfall. So a number of these water market rules which are important in the long term, won't fundamentally alter the fact that we currently don't have enough water in the basin to do everything we want to do, so we have to make hard decisions and we have to prioritise the critical human needs of communities. LO: Senator Wong we thank you. PW Good to be with you |
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