Jul 2, 2012

Transcript – Breakfast with Adam Spencer – ABC 702 Sydney

Issues: Carbon price, tripling of the tax free threshold, family assistance, MRRT, Australian Labor Party

ADAM SPENCER: Anthony Albanese is the Minister for Infrastructure and Transport and he joins us now. Mr Albanese, thanks for your time.

ANTHONY ALBANESE: G’day Adam, good to be with you.

ADAM SPENCER: One day into the implementation of the carbon tax, is it all going well from your perspective?

ANTHONY ALBANESE: Well, the sun came up, which is more than Tony Abbott was predicting. Whyalla’s still there, the dogs are still barking and life will go on. I think the scare campaign that’s been run will show itself to be completely fraudulent when people realise that they’re not paying the tax. It’s the 500 biggest polluters paying the tax. And, indeed, households are getting a lot of assistance.

From today, if you’re earning under $18,000 a year, you’re out of the tax system because of the tripling of the tax-free threshold. That’s just one of the measures that have been provided because of the carbon price.

ADAM SPENCER: Twenty-three dollars a tonne, some people say that even if you do like a price on carbon, that’s just much too high a price to be setting compared to prices currently paid in Europe and around the world, and that price, of course, is geared to increase with CPI over time for the next few years. In retrospect, should the $23 a tonne price have been set a little bit lower?

ANTHONY ALBANESE: We’re moving to an emissions trading scheme. The fixed price is there to provide certainty in the first three years of the scheme. In terms of moving towards a clean energy economy, we do need to put a price on carbon.

Once we have an emissions trading scheme, the price will go up and down with the market – it’ll be set by the market. But, importantly, the fixed price means that businesses are able to have that certainty for the first period of the scheme.

We need to price carbon. The price can’t be just passed on to future generations. The science tells us that releasing carbon into the atmosphere has an impact – a big economic impact as well as an environmental impact.

ADAM SPENCER: When Greg Evans from the Australian Chamber of Commerce and Industry says we’ve moved far faster than the rest of the world – they don’t have these sort of schemes in America and other places that he listed, and says that we’ve just gone out too far in front at a time when lots of sections of the Australian economy aren’t doing all that well, do you accept the argument that we’ve moved too soon on this?

ANTHONY ALBANESE: The sooner in which you move, the cheaper the price will be paid. With anything, when you know you’ve got to get to a destination, the sooner you start, the easier it is to get to that destination.

Now California, the world’s seventh largest economy, larger than Australia, is itself bringing in a carbon price from 1 January next year. It has a target that’s three times higher than ours – a 15 per cent reduction in carbon.

The UK, under the conservative Prime Minister, David Cameron, has a target that’s much higher than our target. The world is moving. In our region, South Korea is putting in place an emissions trading scheme and a price on carbon.

We see action in countries like China. China’s cities are implementing a range of programs and many of China’s cities are almost as large in population as Australia.

So, the world is moving. It’s important for the Australian economy that we move to a clean energy future. The price on carbon is a market-based system and helps us do that.

ADAM SPENCER: Do you accept that some industries will be harder hit than others? It was suggested by the ACCI before seven o’clock, that manufacturing and housing will be particularly hard hit.

ANTHONY ALBANESE: There’s no doubt that there is adjustment required, and that’s why we’ve provided that support. If you’re a trade exposed industry, that is, if you’ve got to compete against countries where there isn’t a carbon price, you’ll receive up to 94 per cent of your permits. We’ve built that into the system.

But we’ve seen plenty of scare campaigns. We heard that a leg of lamb would cost $100 under the carbon price. Contrast this to what we have seen already. For example, Coles and Woolworths where most of your listeners would get their weekly groceries, have said there will be no impact on prices at all.

ADAM SPENCER: Will your Government support the prosecution of organisations that do push up prices unacceptably blaming the carbon tax for doing so?

ANTHONY ALBANESE: You bet we will. We’ve set up, through the Australian Competition and Consumer Commission, a very rigorous process. They’ll have people out there making sure there’s no price gouging here, whether it be by state governments or by individual companies, large or small.

We’re going to make sure that consumers are looked after. Consumers will be able to ring a phone number if they see price gouging occurring. Some companies may attempt to price gouge but once they realise they’re going to be whacked with large fines for doing so, I think that will be a very strong deterrent.

ADAM SPENCER: With regards to advertising campaigns, with your previous advertising campaign that mentioned the – here’s your assistance package coming through to families, blah, blah, that painfully avoided mentioning the phrase carbon price or carbon tax, a lot of people saw those ads and thought that was a little bit duplicitous or evidence the Government’s fear of the public reaction to the carbon tax, that it was the elephant in the room when you watch those ads. Do you accept that criticism?

ANTHONY ALBANESE: I think it’s pretty hard to argue anyone doesn’t know a carbon price was coming in and that the Government’s shy about putting its case. I mean, I did Andrew Bolt yesterday. I’ll talk to anyone about this. I’m sure someone, possibly, is even talking to Alan Jones this morning if he’ll allow us on his program.

ADAM SPENCER: Now, another Monday, another series of disastrous polls for Labor. Whilst you argue that people will eventually realise the carbon tax is not the thing to be feared that others have claimed, there’s no way that the carbon tax is going to get massive support on board for the Labor Party.

In Queensland, 22 per cent primary vote versus 54 per cent. What can Labor do, Anthony Albanese, to actually increase its respect in the polls? What’s going to be the big game changer for the Labor Party over the next 12 months?

ANTHONY ALBANESE: I actually think this is one of the things that will be a game changer. People will have respect for the fact that we’ve brought in such a significant reform that will drive the economy for generations and that we’ve had the guts to do it.

John Howard supported a price on carbon towards the end of his tenure. Governments have talked about it for a long while. We’ve actually got this done – this reform – and along with other reforms that came in yesterday.

For example, the Mineral Resource Rent Tax means the big miners have to actually contribute a little bit back to the country and people can share the benefits of the boom. Other changes came in yesterday include the family assistance package. In my own area, we had reform come in to revitalise the Australian shipping industry.

ADAM SPENCER: But no disrespect to the Australian shipping industry, that’s not going to get your primary vote in Queensland up from 22 per cent to 54 per cent. These are bleak times for federal Labor.

ANTHONY ALBANESE: These are tough times, there’s no doubt about that. But we’re bringing in big reforms. Big reforms have always been difficult.

Go back and have a look at when Paul Keating brought in the deregulation of the Australian economy. When Bob Hawke was Prime Minister – that was a tough time. When the GST first came in for John Howard that was a tough time as well.

But what we have to do is to argue our case. There’s no more significant thing that a government could do.

ADAM SPENCER: Okay. Thank you very much for your time this morning, Anthony Albanese.