Television interview - ABC 7:30

26 Jul 2022
Prime Minister
Relationship with China, Australian Defence policy, Cost of living pressures and inflation, Dealing with the previous Government’s trillion dollars of debt, Fulfilling our Government’s commitments, Fixing the aged care crisis, Boosting productivity

SARAH FERGUSON, HOST: Prime Minister, welcome to 7.30.

ANTHONY ALBANESE, PRIME MINISTER: Good to be with you, Sarah, and congrats on the new gig.

FERGUSON: Thank you very much. Your day today, new gigs, that was an emotional moment. What was going through your head when you spoke?

PRIME MINISTER: Just the power of what we have to do to achieve recognition of First Nations people in our constitution and give them a voice to Parliament. I thought Paul House's speech was incredibly powerful and hence I threw away the script this morning.

FERGUSON: Let me turn to another issue, your Defence Minister and Deputy Prime Minister Richard Marles says that China's rapid military build-up gives him sleepless nights. Now you're Prime Minister, does it keep you up at night?

PRIME MINISTER: Well, we live in an era of strategic competition and a significant change in what is occurring in our region. We've had the issue of chaffing and the incident with the Australian aircraft. Yes, national security is a major issue. It is a responsibility of every government to look after national security and we live in an era of real uncertainty.

FERGUSON: Does it give you sleepless nights?

PRIME MINISTER: Well, people will use their own definition. It certainly is one of concern and something that we're very vigilant about. We've had regular national security committee meetings. I attended the NATO summit in Madrid, I attended the Quad Leaders’ Meeting because of the priority that's on the changed security environment, not just in our region, but in the world.

FERGUSON: Let me ask you this, Labor's wartime Prime Minister John Curtin is one of your political heroes. In 1942 when Australia faced an existential threat from Japan, he used to pace The Lodge at night saying to his aides, "How can I sleep when our men are in the Indian Ocean surrounded by submarines?" Do you ever imagine yourself in his shoes?

PRIME MINISTER: Well I certainly hope not. What we want is peace and security in the region. We don't want military conflict and that’s why we need to do everything we can to avoid it. That's why our support for the people of Ukraine in their struggle is about the rules-based order which is so important.

FERGUSON: Forgive me for interrupting, Prime Minister, but the war that everyone fears is with China. General Milley is here, the Chairman of the Joint Chiefs of Staff. He said that China's behaviour is noticeably more aggressive. This is my question, do you have a responsibility to the Australian people to lay out the risks that this could end in war?

PRIME MINISTER: We have a responsibility to put out facts without raising fear that mightn't eventuate. What we need to do is to have a sober response to the circumstances that we face and that's what my Government is committed to doing.

FERGUSON: Does that include the inevitable US pressure that would come on to send troops, air or naval forces to defend Taiwan?

PRIME MINISTER: Well, what it means is that we don't deal with hypotheticals for a start.

FERGUSON: Sorry. Didn't it become a lot less hypothetical?

PRIME MINISTER: It is very important that we don’t do that because that's not in the interest of peace and security in the region. And that's why there has been for a long period of time a position of, a bipartisan position, of the one-China policy firstly, but also a position of support for the status quo.

FERGUSON: Didn't it become a lot less hypothetical though when President Biden said that America would, he committed America to defending Taiwan recently?

PRIME MINISTER: Well, I've stood next to President Biden when he said there has been no change in the US position.

FERGUSON: But he also said they would go to Taiwan's defence.

PRIME MINISTER: I stood next to him when he said that. That's consistent with Australia's position which is unchanged.

FERGUSON: Just in terms of the Australian public, do you think that you should be laying out in more detail the risks?

PRIME MINISTER: I think that the Australian people are very conscious about the risks and it’s important that we lay out the challenges that are before us in the national security space, but it is also important that we don't raise fears in order to score domestic political points.

FERGUSON: Understood. Moving on to finance, tomorrow we have new inflation figures out. They're expected to be bad. Are you worried that you're going to have to spend your first-term digging Australia out of this quagmire?

PRIME MINISTER: Well, we'll be giving an economic statement on Thursday through the Treasurer, Jim Chalmers. We face economic head winds. We face rising inflation. We face rising interest rates. There are real challenges there, but I'm comfortable that my Government has a plan to deal with those challenges.

FERGUSON: Your Treasurer is using much stronger language, he said that what we're going to hear is confronting. I guess the question is we're possibly facing a global recession. There is bad news from Germany today, they look like they're on the edge. Is that going to end up being your main priority, keeping the economy out of recession?

PRIME MINISTER: The economy is always going to be a big priority and for a Labor Government, it is always about jobs. It’s not an economy for itself, but it’s an economy in terms of the impact that it has on living standards and one of the things that we know is that working people in particular are under real cost of living pressures. We said that during the election campaign, working people know that. They're going to the supermarket and they get hit with a bill that's a lot higher than what they got hit with a year ago.

FERGUSON: So are you concerned about that? When you think about what the Reserve Bank are going to do and what they’re predicting and in light of what the Deputy Governor said recently about that portion of the population who would really suffer from higher interest rates, are you concerned that a lot of people could lose their houses?

PRIME MINISTER: Well, what we know is that in terms of inflation, it is expected to be a higher number tomorrow. But it is also expected to peak and then to decrease over a period of time. So what we need to do is to make sure there are appropriate settings put in place. The Reserve Bank is responsible for part of that, but so is the Federal Government and we'll be doing our bit to take pressure off working people by addressing things like cheaper childcare, that will have an impact improving their standard of living.

FERGUSON: That longer term impact, does that mean you're prepared for the economy to go further into the red for some down the track productivity gains?

PRIME MINISTER: No, what we’ve done is target our investments at areas that will build that long-term productivity. So, what we saw from the former Government is and we've inherited it, $1 trillion of debt, but not much to show for it. There was nothing there in terms of building the capacity of the economy, building productivity. So our focus is on the Jobs and Skills Summit, for example, will have an agenda on how we boost productivity. And that's how you can lift wages and lift profits and support businesses but also support workers, and without putting inflationary pressure on.

FERGUSON: But in the short-term, in your first-term ambitions, you've got a shift to clean energy, you've got investments in universities and TAFE, NBN and childcare. Are you prepared and have you prepared your colleagues that under these economic circumstances some of this is going to have to be put on hold?

PRIME MINISTER: No. Look, we fully intend and the Governor-General's speech today highlighted our agenda for this term. One of the things I outlined during the election campaign was a realistic, pragmatic, achievable agenda for the first-term of a Labor Government and we intend to deliver it. We intend to honour our promises because that's how you build a more productive economy.

FERGUSON: Let's take age care and the aged care crisis for example. You said yourself I think quoting the Royal Commission that more than 50% of residents were literally starving which is an incredible fact. You'll need to inject billions into aged care to fix this. While at the same time you want wages to rise for aged care workers. Will you have to put some of those promises in relation to the urgent problems in aged care on hold?

PRIME MINISTER: No, well take that as an example. What we’re doing is working with the Maggie Beer Foundation to deliver better food for people in aged care, having that partnership. And one of the things that Maggie Beer says, it is not about additional money, it is about getting it right. It’s about getting it right, it’s about getting the right food, the right nutrition.

FERGUSON: But in this case we are talking about a large amount of additional money aren’t we, with the $1 trillion of debt.

PRIME MINISTER: Well we are talking about significant investment and wait and see what happens with the wage case which the Fair Work Commission will deal with. But one of the things we know is the Aged Care Royal Commission said if we don't pay age care workers more, we won't have a workforce. We can't leave our older Australians destitute. They need to have the respect and dignity that they deserve in their later years.

FERGUSON: We've got a lot of deaths in aged care at the moment. It is two years since the Newmarch disaster in New South Wales and the inquest has just started. With the deaths that we are seeing now, is there an argument for another Royal Commission into why so many people are dying in aged care?

PRIME MINISTER: No look, we have had a Royal Commission into aged care. What we need to do is to implement the recommendations of the Aged Care Royal Commission. This week, we will be introducing legislation that will deal with 17 of the recommendations from the Aged Care Royal Commission.

FERGUSON: Once again, you say you want to raise wages, but does that kind of increase come with a concern that it is going to fuel inflation?

PRIME MINISTER: No and the Reserve Bank, there is no one saying that there is wage-led inflation.

FERGUSON: Not yet.

PRIME MINISTER: That's what they're saying and that's why you need to build a more productive economy. But we make no apologies for saying that wages were held back as a conscious decision of the former government's policies. That's not our policy. We want an economy that works for people, not the other way around.

FERGUSON: Just on that $1 trillion in debt. How do you get close realistically to the ambitions that you have laid out with that coming into government with that very large debt?

PRIME MINISTER: Because the big difference between us and the other side is that they created $1 trillion of debt with nothing to show for it. But if you invest in better NBN, if you invest in a more productive workforce, if you invest in skills, if you invest in infrastructure, if you invest in clean energy that drives cheaper energy to drive new industries and new jobs, what you'll do is boost the capacity of the economy and that's what's been missing in the past few years from the former government.

FERGUSON: Talking about clean energy, let's talk about climate. It looks like you're going to get the Senate votes to pass your 43% emissions target. But the Greens at the same time are asking you to commit to no new coal and gas projects for export. Will you resist them so as not to forego the substantial revenue that would come from those projects?

PRIME MINISTER: We will be supporting our policy. Our policy is Powering Australia. That will be 43% reduction.

FERGUSON: But that's a question about a moratorium or putting a stop to projects for export.

PRIME MINISTER: Well that’s not in our policy and we won't be implementing that policy. That's the policy of the Greens and no doubt they will be pursuing that, they’re entitled to do that. But that's not the policy of the Labor Party and we won't be supporting it because that would have a devastating impact on our economy.

FERGUSON: But at the same time, you've got the UN, an institution that you said last week that you trust and have faith in, saying that the status quo we have at the moment, the window is closing in that status quo for containing warming to 1.5 degrees. So if you're not going to stop exports, you're going to be contributing to an increase in emissions.
PRIME MINISTER: Well, that's not right, of course.

FERGUSON: Because?

PRIME MINISTER: Because there is not a finite, there is not a small amount of fossil fuels in coal for example, there is not a small amount. It will get replaced. If Australia today said we are not going to export any more coal, what you would see is a lot of jobs lost, you would see a significant loss to our economy, significant less taxation revenue for education, health and other services, and that coal wouldn't lead to a reduction in global emissions. What you would see is a replacement with coal from other countries that's likely to produce higher emissions because of the quality of our product.

FERGUSON: I'll push back on that because it is the IPCC who takes issue with the issue of emissions for Australian coal. There is not much more than a 1% difference in emissions between Australian coal and coal from other countries, but the bigger question is really around the suggestion.

PRIME MINISTER: There would be a replacement.

FERGUSON: But it’s a zero sum game.

PRIME MINISTER: And you have seen for example, China has stopped the import of Australian coal. That doesn't mean there is less coal being burned in China. We are actually seeing it play out right now.

FERGUSON: But isn't the UN asking you to be part of a global movement towards transitioning away from coal, not being part of putting more coal into the global economy?

PRIME MINISTER: And we are being just that. Just that with our policy which is why it has received support from global countries whether it is the Quad Leaders, whether it is our European partners, whether it is the Pacific Island leaders who I met with just a fortnight ago. They’ve all welcomed Australia’s new stand. We're back around the table of taking action on climate change. We're out of the naughty corner and part of that though, one of the things that the UN recognises, and that's why they measure emissions based upon where they occur, not where the product comes from. Japan doesn't have to account for its emissions if a Japanese car in Australia is emitting carbon dioxide. That is why the UN has that system.

FERGUSON: I want to go back to the speech you made in Parliament today. You used the term, you said, "There is no middle path when it comes to recognition." You said you have to seize the moment. So, just to end on that, how quickly will you be able to move to enshrine an Indigenous Voice to Parliament?

PRIME MINISTER: I want it to happen this term and I want people to come together and to seize the moment. If we lose the momentum that's there, it could be lost for another generation. We had a Referendum at the end of the last century, more than 20 years ago now, to recognise Indigenous people in our constitution and it wasn’t successful. We need as a nation to unite. It is something that will be uplifting. It is not only in the interests of First Nations people, it is in the interests of all of us.

FERGUSON: Thank you very much indeed for joining us, Prime Minister.

PRIME MINISTER: Thanks very much.