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Good afternoon. Welcome

to the program. I'm Ashleigh

Gillon. We've all noticed

our power bills are going up,

but who is to blame. There's

the carbon tax increase, but we're compensated for that, what is else

what is else is responsible

therefore? Is it the States

as Julia Gillard argued

today. We'll look at the stoush to erupt between the

Climate Change Minister Greg Commonwealth and States with

Combet. Plus the CE oft of

the Energy Supply Association

will talk us through the

reasons behind the price

hikes. First, Vanessa will

bring you up to date on

today's top

stories. Ashleigh, thank you, hello everyone. Julia to Gillard says the States need

to do more to address the

issue of rising electricity

prices. The Prime Minister

says she will push the States

at the next COAG meeting to

try to tackle the large rises

seen in recent years. People

are paying a lot more. In

some States bills have gone

up almost $1,000 in just a

few years. It is very clear

that working Australians, pensioners, the

pensioners, the sick, the

aged, people who need the

most help, the people Labor

governments are elected to

represent, these are the

people who are feeling the

most pressure. But the States

have fired back, saying Ms

Gillard is trying to deflect

attention from the carbon

tax. The people of NSW will

not be fooled. The

independent Pricing and

independent Pricing and

Regular try Pricing Tribunal

has assessed the Prime

Minister's carbon tax. That

assessment is on the

electricity bills that are

now going out and it shows

that the average family is

paying an additional $316 per

year because of the carbon

tax. It's as simple and

clear as all that. In the

mean time, support for the

Gillard Government has hit a

six-month high, but voters

remain unconvinced about both six-month high, but voters

leaders. That's according to

the latest Newspoll. Labor's

primary vote has climbed 5

percentage points to 33%.

However, the Government

remains well behind the

Coalition two-party 46 to

54%. No improvement really

in the way that people

perceive their performance,

but disapproval has gone down

for both leaders by a few

their points and knocking down

their net negatives to what

seems like a small 30-ish for

each of them at the moment.

We're also seeing something

else, though, which I think

they won't take any heart

from, that is that we now

have a record for this

electoral cycle of 26% of

people who won't nominate

either leader as better Prime

Minister. Pollster s are also

saying the lift in support

for the Government may be

related to the Olympics, with

voters focusing on London

voters focusing on London

rather than Canberra. The

Reserve Bank has indicated

there's little urgency to cut

interest rates at its monthly

meeting. It's kept the

official rate at 3.5%, signalling it's happy to

leave rates on hold for now

and wait to see how cuts from

May and June will impact the

economy. It's a very even

balance-balance statement, a

balance-balance statement, a

bit more optimism in terms of

the global economy. China's

economy has moderated to a

sustainable pace, but doesn't appear to be slowing further. That's optimistic. In terms

of Europe, they say a very

difficult decision ahead for

Europe. Policy makers

confront the very difficult

task of seeking to put bank

and sovereign balance sheets

on to a sound footing. The

US economy looks as though it

some will remain pretty soft for

some time. The RBA says it's

concerned with the high

Australian dollar, but, on a

positive side, it seems that

home prices are beginning to

stabilise. As we head into

day 11 in London, Australia

is looking for more gold,

having finally broken through

for its first individual

success at the Olympic

sailing regatta. Joining us

with the details

with the details is Jim

Callinan. Jim, there are

signs of more to

come? There's no such thing

as a sure thing, but Nathan

and Iain must be that for

Australia. They only have to

finish the race to claim yet another gold for Australia.

They had the day off, believe

it or not, it's a rest day

for them at the racing

regatta the. Sally Pearson's

big moment has arrived in London,

London, chasing gold on day

11 of the Games. She's warm

favourite to take out the 100

metre hurdles after breezing

through the heats. She races

in the semis in the early

hours of tomorrow morning,

with the final to follow at

around 6 o'clock Australian

eastern time. Also at the

track tonight, 100 metre

champion Usain Bolt will

feature in the heats of the

200, as he looks to claim the

did sprint double just like he

did four years in Beijing.

Anna Meares is heading

towards a dream showdown with

arch rival Vic Pendleton,

with the pair likely to meet

in the final of the women's

track sprint. It follows, of

course, the success at wey

Mouth with sailor ending

Australia's nine-day gold

medal drought. The 27-year-old has since

27-year-old has since been congratulated personally by

Prime Minister Julia Gillard

for more reasons than one.

The PM phoned the Central

Coaster not long after he

claimed Australia's second

medal at the London Games. I

wanted to lend my voice to

congratulate Tom on his gold

medal. I had the opportunity to speak with him this

morning. I know all

Australians are rejoicing.

We're very proud of him, and

particularly Australian We're very proud of him, and

red-heads. As mentioned, the

sailing team is sure to add

to the medal account, with

Nathan Outteridge and

e-January rr Jensen only

having to finish the race,

while we're strong chances in

the other events at the

regatta as well. Shane

Perkins claimed bronze in

men's sprint cycling

overnight. It took him only two races in

two races in the best of

three head to head race to

defeat his opponent. Jason

Kenny of Great Britain was

too good in the ride-off for

gold. After 10 completed

days of competition, this is

the medal tally:

As mentioned, also ahead

Sally Pearson's semifinal in

the 100 hurdles and Anna

Meares also in action in the

early hours of tomorrow. We

can brew the coffee, it's all

on again. Thanks, Jim.

Moving on to other news, volcanologists in New Zealand

say they don't know if there

will be another eruption from the

the Mount Tongariro, which

came to life last night after

more than 100 years lying

dormant. Roads were closed

and flights diverted amid

fears about the scale of the

eruption misked by darkness

and heavy cloud. After daylights, officials were

able to get up into the air

to assess the damage. As a

result of this event, ash and

rock was ejected from

rock was ejected from the

volcano in approximately a

1km radius. No mandatory evacuation orders have been

given and police are urging

locals to remain calm and

prepare for the possibility

of further eruptions. The

custody dispute involving

four sisters and their

Italian father will return to

the Family Court after an

appeal to the High Court was dismissed. The High Court

was asked to decide if the

was asked to decide if the

family law Act is

unconstitutional, but the

Full Bench has ruled against

the appeal just hours after the hearing began in

Canberra. The sisters, aged

9 to 15, attracted media

attention in May when they

went into hiding to avoid a Family Court order to return

to Italy. Lawyers today

asked the High Court to

declare part of the Family

Law Act unconstitution al. It has been

It has been rejected and the

dispute will now be settled

in the Family Court.

Captured fugitive Malcolm

Naden is facing a second

murder charge. Australia's

most wanted man was found in

bushland in northern NSW in

March after 7 years on the

run. He was charged with

murdering mother of 2, Kristy

Scholes, in 2005. Today

prosecutors also charged

prosecutors also charged

Naden with murdering his

cousin, Lateesha Nolan, in

the same year. Naden didn't

end a plea because his lawyer

says he's dealing with mental

health issues. More than

three years after the

devastating Black Saturday

bushfires, a Melbourne law

firm has launched a class

action against a major

Victorian power provider. Lawyers for

Lawyers for Morris Blackburn

claim SP auznet's negligence

led to the deadly Marysville

fire that killed more than 30

people. In the early

afternoon of February 7, 2009

the mill near Marysville

caught fire with flames

reaching heights of over 100

metres. The huge firefront

devastated Marysville and now

lawyers say the power company

lawyers say the power company responsible for maintaining

the power lines should take

the blame. There's a strong

case for saying that the

cause of the Murindini fire

was the failure of a powerline. More than 500

homes were destroyed,

businesses turned to ash, and

34 people died in the blaze.

Today, Morris Blackburn

lawyers filed papers in the Victorian Supreme Court to launch a class action and

they expect dozens of the victims of

victims of Black Saturday to

join them in making SP Ausnet

pay. We'll be saying they

caused the fire and it was

their negligence which caused

the fire and as a result they should pay compensation to

the victims. But the power

company released a statement

to the Stock Exchange acknowledging a police report

to the corridor stating:

Lawyers say they'll be

seeking a major compensation

payout. It's clearly a very

significant sum, probably

running into the tens,

perhaps hundreds of

millions. SP Aus net has told

shareholders the company

doesn't know the full extent

of costs and doesn't know

whether insurance will cover

it either. Lawyers for

it either. Lawyers for

Maurice Blackburn say they

expect such a large company

to avoid its legal bills. The

Syrian Prime Minister has

defected and fled with his

family to neighbouring

Jordan. A statement by Riad

Hijab said he joined the revolution. It's also claimed two ministers and

three army officers defected

at the same time. Syrian

television claimed Mr Hijab was sacked, though.

was sacked, though. More

details are emerging out of the United States about the gunman who shot dead six

people inside a Seek temple

in Milwaukee. Army veteran

Wade Michael Page has been

described as a frustrated neo

Nazi who led a white sa

premmist music band and has

ties to multiple racist organisations.

organisations. The FBI said

Page had a minor police record, but there was nothing

to show he was a threat. We

had no reason to believe, and

as far as I know no law enforcement agency had any

reason to believe, he was planning, plotting or capable

of such violence. Police say they're yet to establish a

motive, but strongly believe

the gunman acted alone. A

quick look at sport now.

Buddy Franklin will begin his driver education course today,

today, as a penalty for

losing his licence for

speeding. Franklin was

involved in a minor collision

overnight. The Hawks star

confirmed he was unharmed in

the incident. The driver of

the other vehicle, though,

received medical treatment

for an arm injury. Franklin

was still licensed to drive

28 days after his speeding

infringement. The weather -

windy with showers in the south-east tomorrow, dry in

the east, showers clearing in

the west. It's 12 minutes

past 4 eastern time. Now

back to Ashleigh in Perth, as

PM Agenda continues. Thank

you, Vanessa. Yes, after the

break we'll be chatting with Climate Change Minister Greg

Combet. That's next.

Welcome back. Julia Gillard has opened up another

front in her war with the

States today, laying the

blame for higher power prices

directly at their feet. In a

speech on energy policy, the

Prime Minister acknowledged

her carbon tax is adding to

power bills, but pointed out

some households are being

compensated for that. She argued

argued that's not the case

for the other price rises

we've seen in recent years and warned the States they

could face more regulation if

they don't start to play

ball. The inefficiencies

that exist in the current

system - I want real

decisions this year to guide

price determinations,

beginning next year. My

preference is to work

cooperatively with the States

through COAG to deliver a

through COAG to deliver a better outcome for consumers.

We won't lightly use the big

stick of regulation, of

stronger powers for the

energy regulator and the

ACCC, but it's a stick we

hold and which we will use if

required. The Opposition and several Liberal energy

ministers were quick to hit

back today, coming up we'll

speak with Climate Change

Minister Greg Combet.

Minister Greg Combet. First,

here's some of the criticism directed at the Prime Minister's speech. The Prime

Minister gets the gold medal

for both electricity price

rises and hypocrisy. That's

because the carbon tax is

designed to increase

electricity prices. It's

intended to increase

electricity prices, and it

does increase electricity

prices. If the Prime

Minister wants to reduce the

pressure on electricity prices, drop

prices, drop the carbon tax.

The Prime Minister has

returned from holidays and

the Prime Minister is clearly

in a combative mood and the

Prime Minister has decided

that she is going to take on the States, and the Prime

Minister wants to deflect

from her own carbon tax and

try to make the States the

issue. Every single increase that

that we have put on

electricity over the last

three years has been

justified. There have been

massive increases in

generation, in retail, in distribution of electricity. The Climate

Change Minister, Greg Combet,

joins me now. Thank you for

your time, Minister. Considering your Government

is clearly so concerned about

electricity prices, why is it

that you're adding to the

pain of that with your carbon

tax? Well, because we have to tackle climate change

tackle climate change and the carbon price will cut

emissions in our economy and

drive investment in clean-energy sources. But

it's important, Ashleigh, to

get a few facts straight here

for people. In every $100 of someone's electricity bill they receive this coming

financial year, only $9 of it

is attributable to the carbon

price. The other $91 is

attributable to other factors,

factors, mainly cost

increases that are happening

in State jurisdictions that

are a result of investment in

polls and wires. What the

Prime Minister was pointing

to today is that where the

companies that own those

poles and wires are owned by

State Governments, the

revenue to State Governments

from returns on those

investments has been increased by 50% in recent

years. It doesn't change the fact, though, that

fact, though, that your

policy through the carbon tax

is to increase power prices.

The States argue that the

other price rises are justified because the other

option they were facing if

these networks weren't upgraded was to put our

energy supply at risk, which

they of course wouldn't be

keen to today? Well, that's

pretty convenient, but people

expert in the energy markets

have been making this

observation for some time

that the investment in the

poles and wires, which is the

poles and wires, which is the

driver of higher electricity

prices in recent years, and

it's continuing, has been

delivering pretty good dividends, has basically

guaranteed rates of return on

it, providing an incentive

for even more investment.

Some critics have argued that

gold plating is going on.

Now, when you've got

States like Western Australia electricity price rises in

in the last two years of 57%,

pricing; nothing to do with carbon

pricing; in NSW over the last

three years of 55%, nothing

to do with carbon pricing,

the State Governments have to

take some responsibility for

the pressure being created.

You've got to remember that

the carbon price is only

adding $3.30 a week, on

average, to household electricity bills and the

Government is providing

$10.10 a week, on average, in

extra cash assistance to

people. But what are the

for State Governments providing

for these massive price hikes

that are occurring within

their jurisdictions? That

compensation, as you say, on

average not everyone is being

compensated for the power

price rises related to the

carbon tax. If you use one

of the examples you used

there, WA, WA retail prices

are still 20% under the cost

of generation. You're not expecting generators to run

at a loss, are you? We heard

from my shadow from my shadow Greg Hunt squealing away a minute ago

in the way he does, misrepresenting things.

What's he said about 57% price increase in Western

Australia over the last two

years, what has he said about

55% in NSW or the very large

increases in all of the other

States? How that wasn't the

end of the world, but the

introduction of a carbon

price was a 9% impact in NSW,

for example, all of a sudden

that's the end of the world. that's the end of the world.

It's just ridiculous. The

facts have to count here, and

the price increase that's

caused by the carbon price

for millions and millions,

the majority of households,

is offset by the cash

assistance that the Federal

Government is providing, but

for all the other increases

that are occurring, now and

over the last few years,

State Governments haven't

provided a dollar to people.

That's an important fact,

that's a cost to business. What's Tony Abbott and Greg

Hunt had to say about

that? Back to my question,

though: you're not expecting generators to run at a loss,

are you? If you're going to

use the example of WA, what

is your take, your reaction,

to that stat, that 20% of the

power prices in the State of

WA are still under the cost

of generation? Well, that's

people in Western Australia their system, but go and ask

about the impact that they've

had of increases in electricity and other electricity and other utility

s. I was in the west last

week and it's a pretty hot

topic. The State Government

needs to explain itself about

that. It's got to stop

trying to blame the Federal Government about the carbon

price. The average effect of

the carbon price in Western

Australia is only $2.50 a

household a week, yet there's

$10.10 in extra cash

assistance, on average. The

Federal Government is

providing help to people to

alleviate these pressures. alleviate these pressures.

We provided more help in the

Budget, particularly for

families with improved family

tax benefits. We've

increased pensions, we've

trebled the tax-free

threshold. We're tackling

climate change. There will

be investment in lower

emissions energy technologies

as a result of the carbon

price coming in, but in the

mean time in these State jurisdictions electricity

prices have run away. So far

the State Governments have

got away with that and it's time they were called to

account. Of course, it's not just Liberal State Governments, is it? This is

a problem that has been

building for so many years,

some Labor State Governments

deserve some attention today,

don't they? If that is the

case, that this has been a

hasn't your Government problem for so long, why

stepped in earlier, the

Australian energy regulator,

the Commonwealth body that approves these network prices

have been saying for a long

time now they need more power time now they need more power

to act. We've been trying to

push along the national

electricity market. They of

course have their origins in

State jurisdictions. My

colleague Martin Ferguson,

the Minister for Energy,

chairs a Commonwealth council

of the ministers to deal with

these things, but ultimately

you need the States to come

along. Remember in a number

themselves own the of States the Governments

distribution networks and in

some States they still some States they still own electricity generators as

well. They need to improve

the efficiency of the

corporations that are in that distribution and generation

business and not use them to

milk revenue through electricity prices for State

Governments. That's

effectively taxing households

and businesses and it needs a

bit more focus. What the

Prime Minister made clear

today is that the Federal

Government will be bringing

early focus to it and looking for

early action to deal with

these pressures. What's the

time frame here? What's the

point where the Federal

Government would step in?

What sorts of extra

regulation do you expect to

see as a result of this? Well, the Prime Minister foreshadowed that towards the end of this year

she wants to be making sure

that the discussions with the

Australian Governments, Premiers in the coalition of

there's a focus on there's a focus on this issue

and we get some results by

the end of this year. I

won't go further than the

Prime Minister's speech, but

attention that's being it certainly needs the

brought to it, because

electricity prices are very important to households and

the economy, the impact to

the cost of living and we've

got to have a very efficient

and lower level of price

increase and we have to have

a very efficient electricity

market place. If you're really genuine about wanting

to work with the States on this, though, was it really

wise of the Prime Minister to

come out and attack them in

the way she did today? Well,

a discussion has been going

on for long enough and it's

time it was brought to the

public fore, because some of

these State Premiers, Liberal State Premiers, but Tony

Abbott and Greg Hunt have

been running around misrepresenting the issue

with electricity prices, attributing everything under

the sun to the carbon price,

and it's all garbage and

misrepresentation. As I

said, when people receive

their bills during the course

of this coming financial

year, only $9 in every $100

is attributable to the carbon

price. The rest of it people

are entitled to ask some serious questions about

because that's the component

that's growing very rapidly.

In relation to the carbon

price, of course we are

assisting households. State Governments are doing nothing

for the other $91. The timing

of this attack today, it is

all about politics, isn't it? We saw the Prime Minister

stand in for Martin Ferguson

to deliver this address

today. We know, of course,

that Australians are going to

be getting their first power

bills shortly that includes

the carbon tax. Does it show

us just how worried the Government is that your

message that you're not to

blame isn't sinking in? Well,

no, it's a serious issue that

needs to be tackled and it's

fair enough that it's argued

in the public arena, because

it's been very slow -- What,

so there's no politics behind

the Prime Minister's speech

today and the timing of

it? We're politicians, so we

argue about things in politics, no doubt about

that. It's a serious issue

that should be properly

argued and addressed. It's

been slow in the COAG process

for this to be properly dealt

with. The Prime Minister has

upped the ante on it. I

think it's a very important

thing for her to have done.

Fair dinkum, Ashleigh, what

are we now in, five or six

weeks into the carbon price

and the world hasn't ended.

Every bit of rubbish that

Tony Abbott has gone on about

in the last 18 months or so

of course has been demonstrated to be false.

One of the greatest false

hoods he's engaged in is

attributing everything in

relation to electricity price

rises to the carbon price.

It's wrong, it's completely

untrue, and it's time there

was a bit of focus on what

the real drivers of increase

in electricity prices are. It's fundamentally this investment and potentially

this gold plating of

investment in the poles and

wires, that's what has been

driving electricity prices up

by an average of 50% over the

last few years. Minister, the

latest Newspoll saw Labor's

primary vote lift by a few

points. Is it a coincidence that Julia Gillard goes on

holiday and the Labor Party's

polling improves? I don't

think so. I think what we're

going to see is, of course, a

pretty solid argument all the

way through to the next

election. One thing that is

important that we've been

discussing just in this

interview is the carbon price

is now implemented.

is now implemented. All the ridiculous hysteria that Tony

Abbott and all of his urges

throughout the community have

gone on with for the last 18

months of course has turned

to nothing. They predicted

unimaginable price rises,

death of the coal industry,

the collapse of regions.

None of it is true. I think

people are starting to

realise that. The more time

goes on, the more that Tony

Abbott will be exposed Abbott will be exposed for the charlatan that he really is. Greg Combet, we appreciate your time with us on PM Agenda this afternoon.

After the break, we'll get

more analysis on this issue

with the Australian's Paul

Kelly. Stay with us.

Welcome back. It's just

after half past the hour.

Vanessa has today's top

stories. We'll be back with

more then on PM Agenda.

Prime Minister Julia Gillard

has launched a counterattack

against the States on the

issue of rising power prices.

It comes ahead of the arrival

households since the of the first power bills for

introduction of the carbon

tax. Ms Gillard says the

States must find a solution

and will push them to try to

tackle the large rises seen

in recent years at the next

COAG meeting. According According to the

latest Newspoll, support for

the Gillard Government has

hit a six-months high.

Labor's primary vote is up 5

percentage points to 33%.

However, the Government

remains well behind the

Coalition two-party,

Coalition two-party, 46-54.

Still voters remain unconvinced about both

leaders, with many pollsters

saying the lift in support

for the Government could be

because voters are focused on

the Olympics rather than

Canberra. The Reserve Bank

of Australia has decided to

leave interest rates on hold

at 3.5%. The RBA indicated

there's no urgency to cut

interest rates and says it's

happy to leave rates on hold

for now. They've also said

they'll wait to see how cuts

from May and June will impact

the economy. A man has been

shot by police in Melbourne's

east. The shooting happened

around 3 this afternoon on

Little Way at Vermont. The

injured man has been taken to

hospital with a bullet wound

to his arm. Police are at the scene investigating the circumstances of the circumstances of the

incident. A volcano has

erupted at Mount Tongariro in

New Zealand's north island,

covering it with a thick

coating of ash. The volcano

came to life last night in a

surprise eruption after lying

dormant for 100 years. Roads

were closed and flights were

diverted, but no mandatory

evacuation orders have been

given. The victims of one of

the largest fires on Black Saturday

Saturday are likely to form a

class action against a major

Victorian power supplier.

New evidence explored by

police and the State coroner

has indicated that the

infrastructure of power

provider SP AusNet might be

to blame for the devastating Murindindi fire, which

claimed the lives of more

than 30 people and destroyed

more than 500 more than 500 people. Locals have applauded news of a

class action and say it could

be the closure the town

needs. Tomorrow's weather -

windy with showers in the

south-east, dry in the east,

showers clearing in the

west. We are standing by to

take you live to Opposition Leader Tony Abbott. No doubt

he'll be giving us more

reaction to the Prime

Minister's speech today about

energy policy. There's the

live shot there coming to you

from the NT. We'll go there

live to Tony Abbott when he

starts speaking there with

journalists. In the mean time, let's see what the 'Australian''s editor at

large, Paul Kelly, made of

today's speech. Paul, what

did you think of the timing

especially ahead of, of

course, Australians getting their first carbon tax-inclusive power

bill? This was very carefully

judged, Ashleigh. This is a big play by Julia Gillard on

the question of carbon

pricing and higher power

prices. Her message really

is "Hay, don't blame me,

blame the states. I think

we'll see a fearus response

to this from tabt and also

from the Liberal State

Premiers. Essentially what

the Prime Minister is saying

is that over the last four

years power prices have gone

up 48%. In NSW they've gone

up 70%, and the main people

to blame for this are the

State leaders, the State leaders, the State

Premiers, so Gillard now is

attempting to say not only

did the carbon policy not

make all that much

difference, but the States

are really to blame

here. Paul, is it wise, do

you think, for Julia Gillard

to open up another front in

this war that she has going

with the States? Well, I

think we're going to see a

very strong reaction from the

Liberal Premiers and from

Tony Abbott. Given the

tension between the Prime

Minister and the States now

on a range of issues, I think

this will only make things

worse. I think the State

Premiers have to get a lot

smarter in terms of the way

they play the politics of handling Julia Gillard,

because over the course of

the last fortnight I think

she's been very much in the

ascendancy against them,

particularly on the question

of the National Disability

Scheme. I have no doubt

we'll see a very strong

counterattack when it comes

to the question of carbon pricing. It's also important

to note, however, that

Gillard is saying that she

wants, through COAG, a new

program to be devised to

curtail power price increases and she wants the support of

the States in terms of

achieving that. Paul, thank

you for that. I need to interrupt you interrupt you because we're

taking our viewers live now

to the Opposition Leader,

Tony Abbott, speaking in the

NT. Lip lip personnel of

HMAS Bundaberg for the

opportunity to see at close

quarters what they do to have

a chance to talk to so many

of them about what's

important to them. I want to

say on behalf of the

Coalition - we deeply, deeply

respect the work that the

Navy does, we deeply respect

the professionalism and the

commitment of all our naval

personnel. These are highly

professional people doing a

difficult job under trying

conditions. They show

tremendous commitment and

very high levels of

patriotism and devotion to

duty. So, on behalf of the

Coalition, and I'm sure on

behalf of the nation, I behalf of the nation, I

salute the men and women of

Norcon and all those involved

in our border protection

efforts. The tragedy, of

course, is that the men and

women of our Navy and the

other border protection

forces are all too often

being left to pick up the

pieces of this Government's

border protection failure s.

All too often they are All too often they are

acting, in effect, as a water

taxi service for the people

smugglers, because this is a

Government which has chronically failed to stop

the boats. The flow is

becoming a flood. There's

now been some 378 illegal

boats under this Government.

Almost 22,000 illegal boat

people under this Government.

2012 is already a record year

for illegal arrivals by boat.

This is a monumental,

comprehensive policy failure

and the truth that the

Australian public understands

is if you can't control our

borders, you can't govern the

country. The Coalition

stands ready to put strong

border protection policies in

place. There are three

essential elements to our

border protection policies:

we have to have rigorous

offshore processing at Nauru;

we've got to have temporary

protection visas, and I

stress temporary protection

visas to deny the people

smugglers a product to sell;

and we've got to have the

option of turning boats

around where it's safe to do

so. Now, I don't for so. Now, I don't for a

moment claim that the work

that our Navy does is easy;

it's not easy, it's very

difficult. At times it's

quite dangerous. But if the

Indonesian Navy can turn

boats around, if the Sri

Lankan Navy can turn boats

around, it is within the professional capacity of the Australian Navy to turn boats

around. They've done it

before, they can do it again.

Just on one other subject

before I throw to questions,

this is a Prime Minister who

is now trying to blame the

States for electricity price

rises that are largely caused

by her carbon tax. At least

50% of the price rises that

people in NSW, for instance,

are now experiencing are the

result of her carbon tax. If

she was serious about

reducing the cost of living

pressure on Australian

families, her speech today

would be about abolishing the

carbon tax, or at least

putting it on hold. But, no, instead this is a Prime

Minister who always wants to

blame someone else for the

problems that she has caused.

Frankly, it is gold medal hypocrisy for the Prime

Minister to blame the States

for price rises when every

one of these price rises goes

through a federal regulator.

So for the Prime Minister to

blame the States for this is

both misleading and ignorant,

and, frankly, her effort

today is a total political

own goal. Do you think that that regulation needs to be that regulation needs to be

strengthened, the federal

regulation? I think it is

gold medal hypocrisy for the

Prime Minister to blame the

States for price rises when

every single price rise has

gone through a Commonwealth

regulator. Her regulator is

allowing these price rises,

so how can the Prime Minister

possibly blame the States for

something that is within her

control? There has been up to nine of

nine of the 14 patrol boats

requiring maintenance at any

one time. Do you think some

of the Government's cut of

the defence budget might be

cause of this? I certainly

think there is nothing that

is going to be as easy or as

possible with a reduced

defence budget. Plainly, the

less money you have for

defence, the less capable defence, the less capable our

Defence Forces will be. The

less available our defences

will be to meet all the

various contingencies that

they must face, including

border protection. On the

asylum seeker issue, there is

currently an expert panel advising the Government.

Will you reject those

recommend ations purely to

force an election? We don't

need an outside committee to

tell us what our policy is.

The Coalition has had The Coalition has had a consistent policy for more

than a decade now. As Labor

members themselves have said,

by establishing this

so-called expert panel, the

Prime Minister yet again has

sub contracted out to others

the job of leadership, which

really falls to the Prime

Minister and the

cabinet. Where do you stand

up on the carve-up of the GST where the territories are concerned? You obviously

have the States entering into yet another brawl as per

usual, but the case is being

made more strongly for the

Territory to lose its GST

carve-up. Where do you stand? I think it's important

that we wait for the

Greiner/Brumby report. Once

we have that report, we'll be

in a much better position to

know exactly what is going on

inside the black box of the

Commonwealth grants Commission and in good Commission and in good time

before the next election. In

receipt of that report, the

Coalition will have more to

say. Greiner and co have

indicated initial support for

ridiculous horizontal fiscal

equalisation term. It sounds

like they'll probably come

out and back that again. So

do you support horizontal

fiscal equalisation? I

support a fair go for

everyone. I support things

happening in accordance with

the overall national

interest. Obviously, that

means a fair go for the

territory as well as a fair

go for the larger States.

Let's wait and see what the Greiner/Brumby report comes

up with, then we'll have more

to say. Helping launch the

CLC campaign, how closely are

you at coordinating the

policy agenda with Terry

Mills? I'm very happy to be

here to support Terry Mills,

an outstanding leader of the

CLP here in Darwin. I think

he'll make a great Chief

Minister. I'm looking

forward to joining him in an

hour or so's time. Will his

policy on things such as outstations coordinate with

your Government's? We have

the same values and

philosophy. Obviously he's

dealing with Territory issues; I'm dealing with

national issues. We'll work closely together. I

certainly think that what

you'll get from Terry Mills

is much stronger and more effective government here in

Darwin. I look forward to

being able to provide

stronger and more effective

government in Canberra whenever there's an

election. Would you support

changes to the grant scheme

rather than the current Commonwealth grants

scheme? As I said, we've got

the Greiner/Brumby review

process in train. Let's wait

and see what that gives us.

Then there will be more to

say. Following your comments

yesterday about the ration

discrimination Act, today

comments have been made that

you're trying to create an

Abbott-proof fence that will

ensure more bigotry in

Australia. What do you make

of that? I think that's just

desperate politicking from a

Labor Party which is in some

sense at least embarrassed at

the political censorship

which is now going on under

this Government. This is a

Government which is trying to

bully sections of the media

because the media are

reporting the Government's

mistakes. Well, it is the

absolute job of the media to

report the Government's

mistakes and any Government

which is trying to censor

political commentary is effectively trying to muzzle

our democracy. Is it fair to

say that the increase in the

could be attributed to the

fact control boats at some

stage or another are

requiring maintenance? No, I

think the increase in illegal

boat arrivals is due to the

fact that this Government has completely lost control of

our borders. It's not the

Navy's fault boats are arriving; it's the Government's fault boats are

arriving. I want to make it crystal clear that the boats

are arriving on our doorstep

despite the professionalism

of our naval personnel. Just

on the asylum seeker issue,

you mentioned Nauru - my

understanding is Mr Morrison

talked about also the needs to make

to make change s - can you

talk tell us more about how

that will work? Scott was talking about the importance

of having a regional deterrence system rather than

a regional admission system. He wants regional countries

to be working together to

remove the pull factors and

to stop the arrival of people

from outside our region into

our region. Unfortunately, this Government is just this Government is just

turning our region into a

magnet for people smugglers.

That's the disaster we've

got. The absolute disaster

that we've got - a

Commonwealth Government which

inherited a solution and has

created a problem because

Prime Minister Gillard and

Prime Minister Rudd didn't

have the mag nam inty to

leave well enough alone. leave well enough alone. The

people of Australia

understand that the first

responsibility of government

is border protection. You

can't be a fully sovereign

nation if you can't control

your own borders. As I said

earlier, if you can't control

the borders, you can't

effectively govern the

country. The Opposition

Leader, Tony Abbott, there in

Darwin lending a hand to the

CLP's Terry Mills, as we see the NT election campaign kick

off in earnest ahead of the Territory's election at the

end of this month. Also Mr Abbott of course weighed into

the debate. We've been

talking about it here on PM

Agenda about power prices.

The Opposition Leader there

echoed some of the reaction

we've already heard from some

of the States today after

Julia Gillard came out and

essentially blamed them for

the increases in power prices

we've seen in recent years.

After the break, we'll try to

cut through the spin we've

heard from both sides of politics today on this issue.

I'll be speaking with Matthew

Warren, CEO of the Energy Supply Association. Stay

with us. That's after the

break.

Welcome back. For more on the power price debate,

joining me now is Matthew

Warren, CEO of the Energy Supply Association. Thank

you for your time. How much

blame do you think the States

deserve for the rising power

prices we've seen in recent years? We don't need more

politics in power price

stories at the moment,

Ashleigh. The State

Governments have inherited

this problem. It has been

building over a decade or

more. There's no one party

or no one reason why these

are going up. So it doesn't

really help to start throwing blame around, because there

are many drivers of this. We

have to find ways of bringing

bills down as fast as we

can. What is behind the price

hikes? Look, it's a

combination punch. The first combination punch. The first

thing to remember is that the

modern Australian electricity

network and power stations

grid was built around the

1960s in most States, so new

power stations and those big

transmission lines and the

poles and wires are all

getting to 40, 50 years old.

A lot of this cost has just

been the replacement of that

ageing infrastructure. Those

decisions in many States were

put off, so around 2000, when put off, so around 2000, when

we should have started to see

a lot of spending on this, it

was deferred and deferred as State Governments just

thought they'd do the least

they had to now and keep as

much money back for

themselves as they could,

until we got to the point in

the last five years that

spending became critical. So

you rob Peter to pay Paul, prices effectively below the

rising price of inflation in

most States have been

skyrocketing to catch up on

that necessary spending.

There are two other factors.

One is certainly reliability

standards have been tightened

in some States. State

Premiers - the number one

mantra for Premiers for a

long time was whatever you

do, don't have a blackout in

an election year. They made

pretty onerous standards to

make sure that didn't happen

and it had to be paid for.

The last one is the really

big one we can fix, peak

prices or peak demand. 10

days a year on very hot days

in most States the amount of

energy we use sky rockets.

That's a lot to do with air

conditioners. So network

companies and electricity

suppliers are building power

station s and extra capacity

in the grid just for a few

days a year. That's crazy,

because there's a much smarter way, if we smarter way, if we can find

ways of encouraging people to

use less power on those days, we don't need that

investment, so the cost of

the entire grid is cheaper

for everyone. Julia Gillard has threatened more

regulation today. Do you think that's the

answer? Well, there is

regulation already. The

poles and wires and

transmission company bees are

natural monopolies, so they

have to be regulated.

There's a pretty onerous and

highly scrutinised set of

rules that determine how they

rules that determine how they

can charge for that service.

So it's not something that we

don't have regulations and we

need more rules. In fact, it's under review at the

moment. Whether you think

that process can be tightened

or improved in some way, the

savings that that will

deliver are fairly

incremental compared to the

big cost increases we've

seen. We can always do these

things a bit better. But things a bit better. But

really it's the other way,

it's moving to less

regulation and using market

signals and a competitive and

transparent market to let

consumers make smart choices,

both about the way they use power but also some of the

things they put into their

homes and businesses. How

important is that, re educating consumers about the

power grid and their use of

it? Could that go a long way

towards helping the problem

and do you have any tips for

viewers sitting at home wondering how they can get

their power bills down? Look, people are pretty smart and

you give incentives and it's

amazing how quick they'll

respond and pick up to those

cues. We know with mobile

phone bills and a whole range

of other services, we shop

around and get the right

package that suits our needs.

We haven't had to do that

with energy, because there

has been really weak incentive. If incentive. If we had

differential prising and

contracts where you got a

different rate on your power

bill if you agreed to turn

your air conditioner down on

some days, all those kinds of

things that don't mean as

much to some households as

others, that's what it will

look like at the end of the day, smart technologies

helping us in our busy lives

to use power in a way that's

a lot more efficient and

therefore we have a network and a grid which and a grid which works a lot

smarter. Matthew Warren, we

appreciate your insights here

with us on PM Agenda this

afternoon. Thank you for

that. Thanks, Ashleigh. Just

before we go, we've just got

word that two Australian

soldiers have sustained minor wounds in Afghanistan. They

were injured with an

improvised explosive device

that blew up in the Uruzghan Province last week. The

alert we've got through from the defence the defence department is

they've both been released

now after precautionary

medical assessment. Just repeating that, two

Australian soldiers wounded

in Afghanistan, but they have

now been released after being

assessed. That is all we

have time for for this

edition of PM Agenda. Do

make sure you join Kieran

Gilbert tomorrow morning, at

8.30 eastern time with AM

Agenda. See you again

tomorrow. Until then, I'm Ashleigh Gillon. Thanks Ashleigh Gillon. Thanks for

joining us. Live Captioning by Ai-Media

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