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Transcript of doorstop interview: Goolwa: 22 August 2008: Murray Darling Basin; Peter Costello; automotive industry; emissions trading scheme; interest rates.

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22 August 2008


Subjects: Murray Darling Basin; Peter Costello; automotive industry; emissions trading scheme; interest rates.



Thanks everybody for being here. Jamie Briggs of course is our candidate for the electorate of Mayo, working very, very hard along with his wife Estee and family and supporters. Simon Birmingham of course has a very deep commitment to the Lower Lakes and is one of our Liberal senators from South Australia.

When I was here last I announced that we believe that a $50 million package needed to be put together by the community under the direction of Jamie Briggs for Mr Rudd to fully fund and support the local community, local businesses, local farms, tourist operators, the environment, local programs that are being run to support the environment in what is an unfolding environmental and economic tragedy here in the Lower Lakes in the lower Murray.

Next week I intend to introduce into the Parliament a Bill which will give specific effect to the $50 million package that Jamie Briggs has been putting together. It’s extremely important that we get Mr Rudd’s attention. But whilst Mr Rudd seems to be focused on a lot of things that are happening overseas it’s important that we bring his attention to what is happening here in the Lower Lakes. He needs to get a message on the Murray and I will be introducing a Bill into the Parliament which will force Mr Rudd to make the $50 million available immediately for those projects which Jamie Briggs and the community of the Lower Lakes and the lower Murray have put together which is so essential to see all of us through this crisis.

No Australian should underestimate just how desperate the situation is in the Lower Lakes and the lower Murray. And for that reason we believe that a $50 million


package needs to be funded. And in order to get Mr Rudd’s attention I will introduce legislation into the parliament which we will expect to have debated and of course [inaudible] the Government both sides of parliament hopefully to support.

I will also be supporting the Senate inquiry to look at how we can move possibly water down the Murray, through the Murray Darling Basin system and the impact of those volumes of water as they’re moved. But I will also want to see the terms of reference extended to see if we can accelerate the infrastructure in the irrigation

system throughout the Murray Darling Basin system. We have got to see what impact if we can accelerate lining and piping and automation of water systems, whether that will have a positive impact on water and get more water down here more quickly than under the plan that Mr Rudd still has not yet implemented.

One of the most important things for the Senate inquiry however is we must have available to us the urgent advice which Senator Wong sought and received on the 18th of June. It is an outrage and an offence to the people of South Australia, and the Coorong and the Murray Lower Lakes, that we still do not know what the urgent advice is. We know that Minister Wong and Kevin Rudd have advice on what can be done and can de done now to get water into this system. And yet they refuse to release it. I call on Mr Rudd to make that advice available immediately, make it available to the Senate inquiry and give us the opportunity to seriously examine what advice is available and what we can do to get water into the system now.

The other thing that will be important for the Senate inquiry to do is to look at the impact of the buy outs further up the system. In terms of compensation, the impact on communities from which the water is bought. And again Mr Rudd needs to get the Australian taxpayers’ chequebook out and make sure that all of the willing buyers in the system are bought out of the system in order to find out what water is available and who is actually prepared to sell real water in the system rather than just selling rights where there isn’t in fact a drop of water.

Money needs to be made available and generally if you put the cheese out the mice will come. And if we get more money available to get willing buyers into the system that will be in the interests of people in the lower Murray and the Coorong and the Lower Lakes system.

Yesterday it was also reported that Ray Najar, the general manager of the Murray Darling Basin Authority suggested a twin lakes proposal for the Lower Lakes that importantly would support a Professor Mike Young. He has suggested lowering by 100 to 150 millimetres the River Murray weir pools. Now Professor Young is someone for whom I have a very high regard and respect. Professor Young seems to think that that is something that we should seriously look at and I have made contact with Professor Young and I intend to meet with him to discuss with him, along with Jamie Briggs, what we might be able to do in looking at the Murray weir pools and

what impact that might have on the Lower Lakes.

We have had about 200 millimetres of water come into Lake Alexandrina as a result, thankfully, of the recent rains that we have got. And according to Professor Young that if we were able to lower the River Murray weir pools by 100 to 150 millimetres that that would put about 150 gigalitres of water into the system and possibly give us


up to 18 months whilst the other many initiatives are undertaken and being implemented.

Now no-one should be suggesting anything that is irresponsible in this regard but we have an obligation to actually look at proposals that are serious, that might actually work in the short to medium term. For that reason I think we should be listening to what Professor Young has to say in relation to that proposal.

What the Lower Lakes needs is real decisions. We still do not have full Commonwealth control of the Murray Darling Basin system. We still do not have a ministerial meeting that has been brought forward to make real decisions about the water that is in the system and what might be made available now. We still need Mr

Rudd to get the chequebook out to see what willing buyers [inaudible] in the Murray Darling Basin [inaudible] to get more water here. And we also importantly, we need to accelerate not only the independent audit of what water is available but we also need some real action, some real decisions to be made.

So we will be supporting the Senate inquiry, we will want to extend that inquiry further, particularly it must be informed by the advice that Minister Wong is sitting on with Kevin Rudd, that must be released in terms of what can be done immediately to provide relief. We will also introduce legislation into the parliament to give real muscle with the $50 million that must be made available to this community. And I will also be meeting, along with Jamie Briggs, Professor Young to discuss the merits and the potential in a responsible way of looking at the River Murray weir pools and what that might do for about 18 months for the Lower Lakes.


Dr Nelson [inaudible] $50 million package, what are we talking about here? What is the detail?


Well the detail is informed and determined entirely by the community. Jamie Briggs is going the length and breadth of this community talking to small business people, farmers, local communities, everybody who is concerned about the environment, schools. He is working tirelessly at the moment to find out what does the local community itself want to see the money spent on. Everything from water carting to the preservation of turtles, to the compensation of businesses, to the lifting of boats that are stuck in mud, to dealing in a financial way with the anguish of people in this community that is not heard by Mr Rudd who seems indifferent to all of this and deaf to the despair that is unfolding here. The $50 million must be invested on those things that the community itself believes are important.


But Mr Rudd has promised he would spend up to $400 million buying back water. $50 million would seem a long way short of that.



Well there’s two differences there. The $400 million, and by the way, I think that he needs to further increase that $400 million so that until there is sufficient money to encourage the willing sellers in the system to come out and sell their water back to the Commonwealth. So $450 million, that’s a lot of money and a step in the right direction. But I think it could actually go further. That is quite different from a $50 million package for the local community.

We have got two issues. One is we have got to get water into the system and look at the mitigation initiatives that need to be undertaken to see the sustainable survivability of the Lower Lakes and the communities that rely on it. The second is we have got

more immediate concerns in terms of businesses that are suffering and in some cases dying along with the lakes themselves. We have got dairy farmers, fourth, fifth, sixth generation dairy farmers that are losing their entire livelihood. We have got people that can’t water their cows, we’ve got people who simply cannot survive in their local businesses. We have got kids that are trying to save turtles and running cake stalls and raffles to try and transport the turtles and provide support to save them. They’re the kind of things that Jamie Briggs and we are working on in order to get some money into the community to support the immediate short term and transitional relief.

The reality is that some people are actually going to have to need financial assistance to change their livelihood. They’re going to have to change the way in which the whole community is operated. It requires money, we think it’s about $50 million and it’s got to be determined by the local community itself.


Do you have support from Labor and the minor parties?


Well, I’ll be shocked if we don’t. I mean, we know that Mr Rudd is all talk and no action. I want to give him an opportunity to actually make a real decision. He said he’s made a lot tough decisions. I can’t think of one single tough decision that he’s made. Here’s an easy one. An easy decision, Mr Rudd, is support a $50 million package for the people of the Coorong and the Murray Lower Lakes and support it now. And I will give him the opportunity next week to do so.


And that’s the thing people are forgetting here. We have lots of people saying we want to fix the over-allocation problem and we had a $10 billion plan last year, if Labor hadn’t have stood in the way, would be actually helping to address that. But the people are being forgotten here, the people of Goolwa and along the Lower Lakes are being forgotten and I think that’s what we’re about, is actually fixing…sure, making sure the environment is fixed and there’s water flow down in the medium to long-term but in the short-term immediate crisis we need to help these people.



The next big decision’s going to be the Wellington Weir. Do you have a view on that, whether it should be built or not and whether or not sea water should be allowed to flood the lower end of the Lakes and the River?


Will we oppose the Wellington Weir? Absolutely.


Yeah, the Wellington Weir…look, the Wellington Weir is a $130 million white flag. What it’s doing is a flag of surrender and it represents abandonment of the people of the Murray Lower Lakes.

No one, no one in this country and no one in South Australia particularly needs to be told just how important this region is environmentally and economically to South Australia. Building the weir is simply a $130 million sign of failure and also of abandonment. There are things that we can do.

All of us know that this is a consequence of a century of mismanagement of the entire system, over-allocation and the worst drought that we’ve had in 100 years. We all know that. And Mr Rudd’s been sought…and Mr Rudd’s been sought to basically diminish the importance of it by saying he can’t make it rain. Well, okay, he can’t make it rain, well I notice it’s raining today but that’s another story. But all that’s doing is distracting from the fact there are things that we can do. There are things we can do right now to support people in this local community. There are things that we can do to get some more water into the system. There are also some things we can do to get one single government entire control of the entire system, a government that will serve the national interest and not be beholden to the interests of Victoria, New South Wales or Queensland. And also there are things we can do to conserve and better manage our water through the entire system. They’re all the things we can do. The cop-out solution is to simply say we’ll build a weir. That is just giving up and we are certainly not prepared to give up.


By opposing the weir, by extension then you’re opposing the opening up of the barrages to mitigate the [inaudible] sulphate soil. Do you think there is another solution?


Well, the things that we’ve outlined I think, certainly at the very least, will buy us more time and I think that there are, in the long-term, sustainable options other than simply opening up the barrages.

A local man who wants to ask me a question - go for your life, sir.



What are you going to do about compensating growers up on the [inaudible]


Well, I think what has to happen there is the Federal Government - that’s one government which happens to be Mr Rudd at the moment but I’m working on that - he needs to have complete control of the entire system from Queensland through to South Australia. He also needs to get out the taxpayers’ cheque book and put it in front of these people and say, okay, what does it take to actually buy this water back so I can get [inaudible] people further down the system, particularly the South Australians who are going to need it.

We also as a country have to face serious questions about the kind of economic activity and agriculture that we think is sustainable for this century as distinct from the last. And they’re broader issues to be addressed perhaps at another time.


Dr Nelson, I don’t think you could escape that question on Mr Costello today. He ruled out challenging you. As far as you know, is he staying or going from parliament?


Well, I’ve got nothing more to say beyond what I’ve already said about it and I think he’s the same.


If you want to talk about leadership, when Mr Rudd came here two months ago he snuck in to [inaudible] he changed where he was going to go because the community worked it out and then he ran away. Brendan Nelson’s been here twice. He’s fronted up. He’s talked to the locals. That’s leadership.


I’ll be back again.


And have you asked Mr Costello for a date on when he’s departing?


Well, again, I’m not going to say anything beyond what I’ve already said, from what I said yesterday, the day before. I’ve got nothing else to say.



Just on the Ford job losses. We’ve had the Bracks Review. Do you think the job losses show that despite any government assistance car companies are going to make commercial decisions?


Yeah well, look, job losses are tragic and we’re in a situation at the moment where over the last few weeks alone we’ve seen job losses from Qantas, 600 jobs from Dons, 680 jobs from Starbucks. We’ve now got 350 jobs from Ford, 160 jobs from Cadbury. Mr Rudd’s Budget has budgeted for 134,000 more Australians to lose their job over the next year. The Reserve Bank has just downgraded the growth forecast for Australia with another 100,000 Australians beyond that to be unemployed who, incidentally, at the same time Mr Rudd’s going to bring in 2,500 people from Pacific nations to pick fruit.

We are going through a very difficult period. This is a very tough climate not only for people here in the Lower Lakes; this is a tough year for Australia. Mr Rudd has got to be honest about the fact that he and Mr Swan talked down the Australian economy, they talked up inflation, they encouraged the Reserve Bank to increase interest rates, they increased taxes in the Budget and here we are now in August with a slowing economy, people losing their jobs, people losing their houses with high interest rates and high petrol. We’ve had a very high Australian dollar which has also compounded the problems for manufacturing.

And as far as the Bracks Review is concerned, as tough as it is, as tough as it is, particularly for people in the automotive manufacturing sector in South Australia and Victoria, in order for us to compete with the rest of the world we have to stay on the track that we’re on as far as tariffs is concerned but, equally, we need to make sure that as much money as is possible is provided to the car industry to adjust to an increasingly competitive world market. We are today able to buy and drive cars made in Australia that are relatively cheaper and are of a higher quality because of the decisions made by Labor and Coalition governments over the last 30 years. It is tough.

But, most importantly, I think Mr Rudd needs to start focusing on a plan for Australia. He’s got a plan for Asia, great, let’s see the plan for Australia. Let’s focus on the Australian economy, on the fundamentals of this country and helping everyday families with petrol, with real decisions on groceries and real decisions that have a positive impact on interest rates.

I mean, at the moment we are being governed by a Prime Minister who thinks that he can give people a pair of binoculars to watch the price of petrol or groceries; that in some way it’s going to bring it down. What he needs to do is to not increase taxes, to cut the excise on petrol and to focus on the economic fundamentals that are facing this country. And I will expect that the Government, with the Australians who are currently losing their jobs and tragically more will lose their jobs as we go through the rest of this year, he should be doing everything he possibly can to help them and retrain them into other forms of work.


And by the way, I might add, the Business Council of Australia yesterday released a study of 14 Australian companies and industries that showed that under Mr Rudd’s emissions trading scheme - which in plain language is tax, TAX - three of those 14 companies will close completely, two will have serious problems in trying to survive and four will have to undertake major restructuring with pre-tax profitability being cut by up to 136 per cent. Mr Rudd needs to again reassure Australians that there jobs are not going to be lost from Australian industries going off to India, China or Indonesia as a result of this rushed, ill-considered emissions trading scheme.


So do you think there needs to be a complete re-think of the ETS?


The most important thing Mr Rudd’s got to do with an emissions trading scheme, or his so-called emissions tax, is to get it right. He’s wanting to rush it through in 2010 before the Treasury officials have even told industry about the economic assumptions that will underwrite it, he wants legislation to be passed before we even know what China and India and the United States is going to do. It’s very important that this be done responsibly, methodically. We’ve got to protect Australian jobs and industries because what he’s trying to do is to make Australians think that it’s only 1000 large businesses that are going to be affected.

That study from the Business Council should ring alarm bells in every household in the country because what it means in plain language is fewer jobs, higher costs in electricity, higher costs in gas and higher costs right throughout our economy. We have a responsibility to be part of a global response to addressing climate change but we must maintain the strength of the Australian economy in the process. And if you

want to talk about job losses, if Mr Rudd keeps on the train that he’s currently on for his emissions trading scheme in 2010 we tragically will have even more because he does not think things through. He’s all backswing and no follow through, he’s all talk and no action but what he’s trying to do with this, he is risking Australian jobs.


If the RBA does cut rates as expected next month, does that mean Wayne Swan deserves a pat on the back?


Well, we’re in an extraordinary situation where apparently after eight-and-a-half months of Mr Swan being the Treasurer of Australia it is considered to be a breakthrough or good news because one of the major four banks will pass on a full interest rate cut of 25 basis points if the Reserve Bank cuts the official rate, cash rate. I mean, what an extraordinary environment.

Can anyone imagine that when the Coalition was in government and the Reserve Bank cut interest rates by 25 basis points, that anyone would even question whether


the banks would pass it on. The only argument was how quickly would they pass it on.

I mean, Wayne Swan stands condemned for two reasons. The day before the Reserve Bank had a meeting early in the year he said that the inflationary genie was out of the bottle egging on the Reserve Bank to increase interest rates. The banks have constantly increased interest rates and ignored everything that he’s said about it and now we’re in the extraordinary environment where Mr Swan thinks that he should be congratulated because one of the four banks is going to pass on a rate cut if the

Reserve Bank delivers it. I mean, it would be a joke if it wasn’t so serious and so many families and businesses were relying on it.

I mean, the fact is the key question that Australians ask Mr Rudd and Mr Swan, why is it after eight months of a Labor Government we are worse off today than we were in November last year? Net household wealth has dropped five per cent in the first six months of this year. It increased 11 per cent last year. We are worse off today under Mr Rudd and his government than we were a year ago. That’s what Mr Swan needs to explain.