SUBJECTS: NSW Upper Hunter by-election; Federal Budget 2021; NSW Labor Party; Australian Labor Party; vaccine rollout; quarantine; borders; stage three tax cuts.

FRAN KELLY, HOST: Labor Leader, Anthony Albanese, joins us now. Anthony Albanese, welcome back to Breakfast.

ANTHONY ALBANESE, LEADER OF THE AUSTRALIAN LABOR PARTY: Good morning, Fran.

KELLY: The New South Wales Labor Leader, Jodi McKay, summed up what went so wrong in Upper Hunter when she said, ‘Why aren’t workers voting for us?’ Can you help her out? What is your answer to that?

ALBANESE: Well, the fact is that the Upper Hunter is a seat that's been held by the National Party, or its predecessor, the Country Party, for more than 90 years. Even when we won seats like Manly, Wakehurst on the Northern Beaches, Willoughby, Premier Berejiklian’s seat, we didn't win Upper Hunter. A couple of elections ago, our primary vote there was 17. And on the weekend, we got 20, which is obviously disappointing. But the National Party got 54 a couple of elections ago and they got 30. So we need to have some perspective here, Fran. It is quite absurd to argue that a seat that has never been held by the Labor Party in more than 90 years is somehow this big test. And our vote in places like Muswellbrook, which is the centre of the mining community, actually went up. 

KELLY: Yes. But hang on. Let's look at that. Because I was talking to someone on the weekend and was looking at the booth-by-booth counts as they were coming in. Muswellbrook went up. The candidate was from Muswellbrook, you'd expect that. But there's also the town of Singleton. 

ALBANESE: That is where the publican ran. 

KELLY: Where Labor's primary vote dived to 20 per cent. Just two years ago, at the Federal election, it was 36 per cent. In 2016, it was 51 per cent. Joel Fitzgibbon says the trend is ominously obvious for Labor. Do you deny that?

ALBANESE: Well, if you look at it, this was a state by-election in one seat, Fran. If you want to look at trends, have a look at Western Australia, have a look at Queensland, including the two biggest resources states in the country where in WA, Mark McGowan is almost in a one-party state situation. And in Queensland, we made significant gains in the regions.

KELLY: But they are premiers running a state during a time of a pandemic.

ALBANESE: Well, you're talking about, and I'm sorry, Fran, but there's a pandemic on and a Premier was running here in New South Wales too. So let's get some perspective here. There's been a lot of very short-sighted analysis, a historical analysis, behind this by-election. And when we were tested at the Federal level in a by-election, not theoretical, Eden-Monaro, a seat that historically has been won by the Government, a seat which on its current boundaries would never be held by Labor during the Hawke and Keating years, we were successful with Kristy McBain. And I stood up with Kristy yesterday at a child care centre continuing to campaign about the issues that matter to people.

KELLY: For Labor to win the election it has to win back seats in Queensland, it has to hold on to those seats around the Hunter where there were big swings against it at the last election. So what's happening in resources seats is critical for your future success. Joel Fitzgibbon described it yesterday on this program as an existential crisis for Labor. Coal mine workers, he said, are fleeing to One Nation because while Labor says all the right things about protecting their jobs, the coal miners simply don't believe you. The issue is, how do you persuade the voters that fled to several places over the weekend but that deserted Labor that you support their jobs?

ALBANESE: And the Nats. 

KELLY: I mean, you've got the Prime Minister saying you've lost touch with blue-collar workers, Joel Fitzgibbon says the blue-collar workers are telling him they don't believe you that you support them. Is that a problem for you? Do you see you've got a problem with the base, with the blue-collar base? You acknowledge that? 

ALBANESE: The evidence is there that that's not the case, Fran. And I was up in Cessnock. 

KELLY: How is the evidence that there wasn't the case in Queensland at the last election and wasn't the case in this? 

ALBANESE: I was up in Cessnock just on the second of March. I remember the date because it was my birthday. And I addressed there people from all of the mining lodges. And I spoke to the workers there. I spoke to them about issues that affected their work, including security at work. One of the things that we've got at the moment from Scott Morrison's Government is an appeal costing hundreds of thousands of dollars of taxpayers' money to undermine permanent work and work security for coal miners in Central Queensland. With an appeal where the Government is backing up business, which is increasingly introducing casualisation, use of labour hire, areas whereby miners doing the same job next to each other can have a pay differential of $40,000-$50,000, different leave conditions, no sick leave, all of those issues that have been taken on by the Miners' Union. Now, I released a report by the Coal Miners' Union in Mackay just about a year ago. They were successful in the Federal Court in getting a coal miner, Mr Skene, successfully classified as a permanent employee. They are issues that have been opposed by the current Government. The current Government doesn't stand up for miners, doesn't stand up for any workers, is undermining the pay and conditions of those miners. And Labor stands with working people. And I won't cop this idea of Scott Morrison, the Party of WorkChoices, somehow being the friend of the workers, Fran. It's just a nonsense. And I'll give you the other big tip too. Labor representatives need to advocate for working people rather than adopt the rhetoric of the Coalition. Because that undermines confidence in the Labor Party.

KELLY: So everything you said there, fair enough, that's what you're doing, that's what you're hearing when you're on the ground. But this is not me making it up. This is me quoting, for instance, the CFMEU New South Wales Northern Mining and Energy President who says, 'Albo is falling further behind in coal country and I think that was a reflection here in coal country in the Upper Hunter. If he thinks he's rebuilding it with blue-collar workers, then I don't know where they are'. So it's an impression that goes beyond Joel Fitzgibbon. 

ALBANESE: Name another colleague besides the one you just named.

KELLY: But he's a significant person in the CFMEU Mining division. 

ALBANESE: George Christensen was the significant person in the National Party, Fran. 

KELLY: That's for you to manage. But let me ask you about what Joel Fitzgibbon said very clearly here. He said in his 25 years in Parliament, he spent six years in Government. He says he won't be 'sticking around to lose again'. Given that he has a personal following in the Hunter, given the 25 years, can Labor really kiss goodbye to that seat if Joel Fitzgibbon doesn't recontest? 

ALBANESE: Well, it wouldn't be a surprise, Fran, those comments.

KELLY: So you wouldn't be surprised if he goes?

ALBANESE: Well, Fran, he indicated very clearly at the beginning of this term, he said he would go from the frontbench halfway through. Listen, there's no surprise here, Fran. 

KELLY: Okay, fine. Can I ask you about Jodi McKay, the New South Wales Labor Leader, she's being urged to stand down given this result in the by-election, should she, do you think?

ALBANESE: That's a matter for the state Party, Fran. That's a matter for her and her colleagues in the New South Wales ALP. I make it a rule to not comment or interfere on what the respective state parliamentary parties do. That is a matter for their consideration. 

KELLY: There's another decision coming your way, another challenge potentially. Some of the blue-collar workers fleeing Labor are well-paid and aspirational. Some of them would welcome the third stage tax cuts which are legislated to come into force in 2024. You're going to have to make a decision before the next election. Will Labor leave the tax cuts alone and support them in full?

ALBANESE: Well, what we said, Fran, in 2019 was that it was a triumph of hope over experience for the Government five years in advance to say they knew exactly what the economy would look like in 2024. Weren't we right, Fran? 

KELLY: Sure. So the economy's in trouble. The tax cuts are legislated, factored into the Budget. We're heading into a trillion-dollar debt within five years’ time. Will Labor support these tax cuts or not?

ALBANESE: We will make a decision and announcement based upon our timetable, Fran. These are measures that don't come in until 2024. We will have a clear policy of all of our revenue, all of our expenditure, well before the next election for all to see. But we were absolutely right in 2019 to point out the error. This was a time, remember, when this was passed, when the Budget allegedly wasn't going to be future surplus, it allegedly was already in surplus with black ink as far as you could see. And the circumstances are very different now. We also remain exposed, of course, to the threat of another outbreak. There is great economic uncertainty. And the Government needs to get its vaccination rollout right, it needs to deal with the issue of quarantine. It needs to be focused on what its job is. And what we see from this Government is just focusing on Labor. They are again acting like an opposition in exile on the Government benches. 

KELLY: Anthony Albanese, thanks for joining us again on Breakfast. 

ALBANESE: Thanks, Fran.

ENDS