ABC News Weekend Breakfast February 23, 2019

February 23, 2019





SUBJECTS: Energy policy, banking royal commission, mortgage brokers, Helloworld travel, National Integrity Commission.


HOST JOHANNA NICHOLSON: For more on the week in politics, we are joined in the studio by the Shadow Assistant Minister for Infrastructure Pat Conroy and Liberal MP Craig Kelly. Thank you both for joining us this morning. Craig, let's start with reports in News Corp papers this morning about this energy announcement from the Government. Just take us through the details of that.


LIBERAL MP CRAIG KELLY: We're trying to put a default offer in there as standard. What we have seen is the electricity companies pushing the price up and offering people a discount. People who aren't on that discount have been paying far too high a price. We have a determination to get electricity prices down. That is what we are working on. In contrast, we have also seen in The Australian this week the report that says, from Brian Fisher, Labor's policy is going to push up the wholesale price of electricity another 58%.


NICHOLSON: But your policy here; is this stepping on the states’ toes a bit?


KELLY: We have to work closely with the states. Remember, electricity was originally entirely a states' issue.  As with many issues that have happened over the past several years, the Federal Government have got involved. So, yes, it is important this we have a close working relationship with all the states in this.


HOST JOSH SZEPS: Craig, the chief executive of the Australian Energy Council says the real problem with electricity prices in Australia is not so much the stuff you guys are trying to address now, but the fact that there is no coherent policy whatsoever and that the NEG would have given some certainty to the industry or the other ways we've tried to address climate change would have given certainty to the industry. Until there is that certainty those problems won’t be alleviated. Is this a cheap shot before the election to try to convince people you guys are responsible on energy prices?


KELLY: We've got record spending at the moment on renewables. There has never been more spending on renewables.


SZEPS: Yeh, but nobody is building anything new. They don't know what the price will be.


KELLY: This is the problem; no base load generation is being constructed. You are exactly right because people look at the future and they see Labor promising a 45% emission reduction target. Under that, your coal fired power stations have to close and your electricity prices go up.


SZEPS: Are you saying they should believe that Labor will never enter government again and Australia will never have a policy on climate?


KELLY: There is policy at the moment. We have a Renewable Energy Target. 

This year, there's $2 billion worth of subsidies going to rooftop solar. $2 billion. Those are the policies at the moment. Where we are falling down we don't have enough baseload power in the system because of the uncertainty and threat of the risks of Labor's reckless emission target.


NICHOLSON: Alright, we might bring in Pat Conroy. Pat, if this does bring down 

prices like the Government says it will, is that a threat to Labor in the upcoming election?


CONROY: Not at all. We announced this exact policy six months ago. Good to see the government catching up with us six months too late. I should point out that the vast majority of people are on discounted offers, so this only applies to customers on a standing offer. It will help some customers, but not the vast majority of electricity consumers. But the key issue the Australian Energy Council identified is that this Government has had 11 energy policies in two-and-a-half years. That is ridiculous. Eleven policies in two-and-a-half years. They abandoned the National  Energy Guarantee, which their own modelling said would reduce power prices by $550. Instead, the Government's own figures say that power prices will go up by $300 because of abandonment of the NEG. What is essential is that we have a coherent energy policy that cuts emissions, that drives investment into the energy sector and improves reliability. We have got a policy and RepuTex modelling has said that our policy of 50% renewable energy by 2030 will reduce power prices by 25% compared to where they would be otherwise.


SZEPS: Pat, Craig made the point that the real problem here is the industry has no idea what the policy is going to be in the future and they are afraid if the Labor Party gets into power that coal and other affordable but dirty forms of energy will become unsustainable in Australia and we won't be able to use it and that will put even further pressure.


CONROY: Industry has been burnt by the fact of 11 energy policies in two-and-a-half years. We have been very clear about what our policies are. We're in a lucky situation; we have a lot of coal-fired power stations that will close due to their age – nothing else. And the Australian Energy Market Operator has said that the cheapest and most reliable replacement will be renewable energy backed up with pumped hydro, batteries and gas. So, Labor's policy of 50% renewable energy will not only replace the ageing power stations with reliable power but it will be cleaner and cheaper and that is a policy I am really proud of.


SZEPS: How do you get there, how do you get to 50%?


CONROY: Well, it's quite easy. We are already at 23% at the moment thanks to Labor's Renewable Energy Target, so getting to 50% by 2030 is quite achievable. In fact, the Australian Energy Market Operator has already modelled a scenario of getting to 50% renewable energy by 2030 and as I said RepuTex said it will be 25% cheaper than what the Government is proposing. It's practical, you just need a coherent plan instead of this Government's changing policy every second day.


NICHOLSON: I want to move on to another topic that has dominated this week. Questions about the Helloworld travel contract - the travel agency that has the whole of government travel contract. There are a lot of questions about this contract and the relationships with various Ministers and Joe Hockey, the Ambassador. Is it time, as Labor has called, to have some sort of inquiry or investigation into these relationships around Helloworld?


KELLY: Labor's had a disastrous two weeks. Absolutely disastrous two weeks. When in trouble, go to the bottom of the mud bucket and throw the mud and see how much you can throw rather than discuss policies. This story is a complete beat-up. We are talking about whether Joe Hockey organised a meeting with someone to try and reduce their travel costs.


NICHOLSON: No, it was in regards to the chief executive Andrew Burns saying that Joe Hockey "owes me". 


KELLY: And that has been denied. But let's just say it is true, even though it is not. It involved organising a meeting. It is not giving any special favours or any special advantage. It is simply organising a meeting.


NICHOLSON: OK, well what about Mathias Cormann, the Minister not being charged for particular flights and not noticing that that happened. The non-charging, that should surely raise questions?


KELLY:  Most people who look at their credit card bill, you go through and look at the charges you don't recognise. You don't go through and tick off everything you have paid. It is quite obvious and explainable what has happened there.


SZEPS: Hang on; when you are taking the international flight that you didn't pay for, you are aware you didn't pay for it.


KELLY: I am sure when you get your credit card, I know when I do, whatever your  card bill is, you go through and look through the bill and what you are looking for, you’re looking for expenditure, I don't recognise that. Oh that's right, yeh, I did do that. I did pay that grocery bill.


SZEPS: But Craig, if I am at home and I am looking through my credit card bill, you are right, I wouldn't notice something that isn't there, but if I was sitting in a business

class seat on an aeroplane going overseas and that was when I was looking at my credit card bill I would be perfectly well aware that flight wasn't on it.


KELLY: Well, that's not what happened. You don't get your credit card bill when you are flying overseas. You look through it and you are looking for charges that are not there. This is a complete distraction. We heard reports out today that Labor's policy this week, an extra $9,000 cut to average wages.


CONROY: Rubbish. Complete rubbish.


SZEPS: Before we change the subject, are you saying that all of the allegations, there are a number of things: the Michaelia Cash concern, the concern about Joe Hockey apparently owning $1 million worth of shares in this travel company that he then took a meeting with because they were owed a favour, ostensibly. There are a number of allegations. There is a comparison that is made in the Fairfax press today, for example, what the corruption standards were like in the 1980s when a Minister accidentally didn't declare a Paddington Bear when entering Australia and then stepped aside and resigned because of the most tiny infraction, in comparison to things that seem de rigueur in the Government at the moment. And you're saying we should pay no attention to it because we should be talking about policy?


KELLY: There are no allegations of corruption whatsoever. There are no allegations that this contract was somehow awarded improperly or was overpaid. It is what we see from Labor. They know they are losing the political debate. They go straight to the mud bucket and throw the mud.


CONROY: Can I respond? Because this stinks on multiple levels. First off, if I have booked a flight and I am looking at my credit card bill I know I have a $3,000 bill coming and why isn't it on this statement versus the next statement? The real issue is: first off, the Foreign Affairs Minister abolishes the travel panel, which meant there were multiple travel options available to the Government. Instead, a billion- dollar contract is offered by Helloworld, a company owned by the Liberal Party Treasurer. Subsequently to this Mathias Cormann receives a free flight he doesn't notice and only pays for it when journalists draw it to his attention. Then we have the Ambassador to the United States Joe Hockey not telling embassy officials he's got $1 million of shares in a travel company when asking them to set up a meeting. Then, DFAT officials don't know about his shares until after the meeting has occurred. DFAT officials are not aware of any other subsequent issues with that meeting. This is incredibly murky. It stinks. This is a government that is just interested in looking after its mates. You just have to look on Friday they appointed 14 ex-Liberal MPs and staffers to the Administrative Appeals Tribunal. This is a Liberal Party; this is a Government for the donors, by the donors, from the donors. The Australian people just think it is incredible that someone could forget about a free travel, could forget to mention $1 million worth of shares.


NICHOLSON: Is Labor still calling for a federal version of ICAC?


CONROY: We committed to a National Integrity Commission last year and we have said clearly this entire saga should be investigated by a National Integrity Commission and this government should commit to the integrity commission because when these things occur people's trust in democracy falls.


NICHOLSON: Why not have that, Craig?


KELLY: We are working through a model. We agree there should be some type of national integrity commission. We certainly don't want the model they have seen here in New South Wales. We have seen many innocent people have their careers absolutely ruined on false allegations.


CONROY: Your model is a toothless tiger.


KELLY:  That is what we don't want to have. These methods, whatever they are, they are all investigated. But again, it is Pat going to the mud bucket and 

throwing the mud because they don't want to discuss the basics of what is happening.


CONROY: If you visit your electorate and talk to people on the streets, I guarantee you they are insulted. You are so out of touch. That someone would forget about a $3,000 flight.


KELLY: They are worried about their jobs. They are worried about their property values.


CONROY: And that someone would forget to mention $1 million in shares.


SZEPS: Pat, your party, as Craig pointed out, has not had a great couple of weeks. It thought it was going into an election in which it would have the upper hand and it seems it has been thrown a bit of a curve ball by the whole question of the Medivac Bill and now questions of economic management under Labor and the banking royal commission. Is this a way for you to just divert the conversation so that we are talking about how nasty and corrupt the Coalition is instead of actually focusing on Labor's policy failings?


CONROY: I reject the premise of your question, that we've had a bad couple of weeks. On the Banking Royal Commission, for example, we announced a commitment to 75 of the 76 recommendations.


NICHOLSON: Which is different to what you did say.


SZEPS: You've dropped one of the recommendations.


CONROY: We have consulted with industry and we've solved the mortgage broker industry. 


NICHOLSON: So, were you premature in committing?


CONROY: No. We've consulted with industry. We said in principle we will follow all of those recommendations and we have hit 75 directly of the royal commission's recommendations. The other one we are attacking through a different way. By contrast, the Government is only committed to 60 of the 75 recommendations. The other 15 are either going slow, or they have dropped off completely.


SZEPS: But if it is OK to drop one, why not 15? You have to do it on a case-by-case basis?


CONROY: No, because the other one we have tackled in a different way. The mortgage broking industry, just like Commissioner Hayne said; there are competition issues if you adopt the recommendation immediately. We have consulted with industry and consumer groups and we found another way of ending the conflict of conduct between the banks and the consumers through mortgage brokers. We have solved it another way. By contrast we have got a Government that voted against a royal commission 26 times. The Prime Minister called it a populist whinge, and will only implement 60 of the 75 recommendations.


KELLY: I think Pat's explaining a backflip with a double pike there.


CONROY: Oh, please. You guys have no credibility on this. You have run a protection racket for the banks and you should be ashamed of yourselves.


NICHOLSON: Labor is vowing to expand the compensation scheme for victims of banking misconduct. Theirs is four times more compensation that the Coalition’s. Would the Coalition look at increasing theirs?


KELLY:  We could, but remember there is the tribunals we're resetting up so these cases can be heard. Where there is wrong-doing, that these people can actually get 

the due and just compensation that they deserve. One thing we have done is we extended - the Statute of Limitations on many of these type of conduct is six years - we have extended that to 10 years. Going back 10 years people will be able to get compensation.


CONROY: On that recommendation, for example, the Government has compensation being paid by taxpayers instead of banks. We have said that the banks should pay for the compensation because they did the wrong-doing in the first place. And that really symbolises the Government's commitment to helping the banks over taxpayers.

You can watch the interview here