Transcript - ABC Radio Melbourne Mornings
Virginia Trioli: But joining you in the studio right now is Alan Tudge, the Minister for Population, Cities and Urban Infrastructure to talk about the big $3.8 billion plan to bring forward infrastructure projects across the country by the Morrison Government. But a lot of it apparently not really being spent until the second half of the next decade.
Alan Tudge, good to see you again. Good morning.
Alan Tudge: Good morning Virginia, and it's great to be here in the studio. And my first interview, I think, with you in your new role.
Virginia Trioli: That's right, in this studio. Many over the past years on News Breakfast.
Alan Tudge: That's right.
Virginia Trioli: Good to have you here in person for Victorians. Minister, I'm holding your very own Budget papers here in my hand, the 2019 papers. Your announcement that you're investing $100 billion over 10 years and you've brought forward now this 3 billion or so into the future or into the present. That three billion- 3.8 billion …
Alan Tudge: 3.8
Virginia Trioli: … over- the $100 billion over ten years. That's slightly more, then, than 3 per cent of what you're promising to spend, 3 per cent. So are we expected to hold a ticker tape parade for that we?
Alan Tudge: Well, Virginia, what we've announced this week across the country, state by state, is bringing forward $3.8 billion worth of infrastructure expenditure …
Virginia Trioli: [Talks over] So it’s just slightly less than 4 per cent.
Alan Tudge: … of which about 1.8 per cent of that, $1.8 billion, will be spent in the next 18 months alone. So we've already got 130 major projects going on right now around the country supporting 85,000 jobs. So there's an enormous amount of infrastructure going on right now. This is bringing forward a further 3.8 billion to get even more projects underway. Now that's good for jobs, it's good for commuters and it obviously supports the economy as well.
Virginia Trioli: Totally expected the speech and that's fine. But now we need to get down to the recognition that that is a tiny fraction of a $100 billion spend that your Government promised back at the last Budget. And indeed a spend that's going to take place over 10 years. It's less than 4 per cent, spread over a huge country that needs an enormous shot in the arm right now. I don't want to say it equates to nothing, but it's pretty disappointing.
Alan Tudge: Oh, I disagree with you Virginia. I mean, we’ve- when we came to office, the amount of expenditure on infrastructure was about half of what it is today on an annual basis. So we've already doubled it. Even in the last budget, it was a $75 billion program which we increased to $100 billion program. Yes, it is over the course of a 10-year period. And that's how we've been doing it in the last few years so that there is certainty. But we've been working closely with the states and territories over the last few months asking them what projects can you bring forward to accelerate because you can't switch projects on necessarily overnight, particularly the big ones.
Virginia Trioli: But no- but the states have just been going it alone. I mean, particularly …
Alan Tudge: [Talks over] No, no, that's not true. Absolutely not true.
Virginia Trioli: … in Victoria. But they’ve pushed ahead with their own infrastructure spending in the absence of the big spending that others have wanted to see.
Alan Tudge: Well it’s not- well it's not in the absence of any lack of funding from the Federal Government. I mean, we've got billions of dollars’ worth of funding here in Victoria. I’m a Victorian, as you know.
Virginia Trioli: I do.
Alan Tudge: I think from memory with we've provided about $26 billion to the Victorian Government over the course of our term of office. And even in the last Budget, an extra $6.2 billion.
Virginia Trioli: Let's get to the Victorian spend in just a moment, but I'd like to get you to respond to some of the criticism since this announcement in the last 24 hours. AMP Capital chief economist Shane Oliver said that the overall decision was moving in the right direction of course, more money is more money, but the extra cash amounted to just 0.1 per cent of GDP spread over two years and here's his quote: put simply, it's not enough to make a difference to the overall economy which remains a long way from full employment and the Reserve Bank's own inflation goals. So it's a nice headline figure and I get why you might want to be out here spruiking that, but when it comes down to the reality of a sluggish economy, one that's growing admittedly but so, so slowly, it just amounts to a hill of beans.
Alan Tudge: Well, a couple of points here. First up …
Virginia Trioli: [Talks over] I mean, is Shane Oliver right?
Alan Tudge: … first up the economy is growing. So we had, the last two quarters, we’ve had …
Virginia Trioli: [Talks over] I acknowledged that.
Alan Tudge: And you did acknowledge that. And in fact overnight the OECD lifted our outlook to 2.3 per cent growth over the next 12 months, putting us the fastest growing economy of the G7 and the average growth that they've got for the next 12 months is 1.6 per cent. They've got us at 2.3 per cent.
Virginia Trioli: I don't know which OCD reports you're reading, Alan Tudge. This is the one that I read this morning: the Australian economy is weak – and that's the quote – households are weighed down by slow wages growth and high taxes and they're backing lower interest rates, calls for more government spending and the OECD sharply downgraded expectations for Australia while raising serious concerns about the level of debt being carried by households.
Alan Tudge: [Talks over] Well they did, and since their September update, they’ve actually increased their outlook for Australia. So in their September update, they had us growing at 2 per cent. Now they've increased that outlook to 2.3 per cent. Our wages now is growing at about 2.3 per cent as well, above inflation. We'd like to see that grow even faster. Unemployment is at 5.3 per cent. Here in Victoria, Virginia, and I don't want to baffle people with numbers, but here in Victoria we’ve got a 4.7 per cent unemployment rate. So we're not- we're not panicking and the Labor Party want us to panic and splash money around like they did last time, spend money on dead people and on cats and all sorts of things.
Virginia Trioli: [Talks over] Oh, no, no no.
Alan Tudge: [Talks over] We're taking it very methodically …
Virginia Trioli: [Talks over] Let's- let’s- let’s not.
Alan Tudge: … Virginia, we’ve had our economic plan. We’re laying it out …
Virginia Trioli: [Talks over] Let’s not go to empty rhetoric.
Alan Tudge: [Talks over] Well …
Virginia Trioli: And we'll actually talk about the calls for you- your Government to spend in just a moment, because they have been substantial and there's some significance to that today. But clearly, your read of the OECD figures very, very different this morning. But the key thing with that …
Alan Tudge: [Talks over] Well they’re the facts though Virginia.
Virginia Trioli: … that- no, I want- I want to take you back to that quote that I put to you there from the economist. Is Shane Oliver wrong? Is he wrong when he says that it's just 0.1 per cent of GDP spread over two years, right or wrong?
Alan Tudge: Well Virginia, this is one element of our broader economic plan which we took to …
Virginia Trioli: [Talks over] Right or wrong?
Alan Tudge: … the election. One element of our broader economic plan. So the infrastructure expenditure which we have underway we're pulling forward even more money. The tax cuts which, as you know, has delivered billions of dollars into the economy. The RBA has been dropping interest rates. We've got free trade agreements, more of which we are negotiating. We're kicking off industrial relations reforms. We've got a skills agenda. All of these are part of our economic plan which we've been methodically working through and it's now meant that the forecasters, including the OECD, have us as being the fastest growing economy in the G7, well above the growth rate of the OECD average.
Virginia Trioli: And- and yet …
Alan Tudge: [Talks over] There's still headwinds, don't get me wrong. We're not- there's still international headwinds …
Virginia Trioli: There’s not- there’s not headwinds, Minister, you’ve got …
Alan Tudge: [Talks over] There’s international- what do you mean, there’s no international headwinds?
Virginia Trioli: No, the issue is you've got a weak economy. I mean the economy might be growing, but whether it's still strong is open to question, isn’t it?
Alan Tudge: Well, we've always said that these international headwinds- we've known this for a long time. I mean this is why we took our plan to the Budget which was specifically designed to support economic growth.
Virginia Trioli: Okay, well let’s get back- let’s get back to those Budget figures.
Alan Tudge: [Talks over] [Indistinct] the contrast compared to increasing new taxes which the Opposition put up.
Virginia Trioli: Let's get back to the Budget figures, then, and the projected spending and the promised spending. And you mentioned there the cash splash that you described by the previous government. But let's think about this. I've heard the rhetoric as well from the Prime Minister about panic and you not wanting to panic. I don't know if this is defined as panic because for what? For close on six, eight months now, you’ve had the Reserve Bank, you’ve had every business group in the country; some of the biggest employers and firms in the country; you’ve had state governments; you’ve had the International Monetary Fund for goodness sake. They’ve have all been calling for this stimulus and yet you waited. Now it’s been announced 24 hours ago, you finally brought something forward. My question this morning is this for the listeners, what’s being gained by waiting?
Alan Tudge: Well what do you think our tax cuts were?
Virginia Trioli: You only achieved that by not doing this spending.
Alan Tudge: What did you think out- but no, what did you think our tax – we had a massive tax cut package, which we took-
Virginia Trioli: [Interrupts] No. What’s been gained by waiting to spend this money on infrastructure?
Alan Tudge: [Talks over] Hang on.
Virginia Trioli: What’s been gained by that?
Alan Tudge: [Indistinct]. Just wait up a sec.
Virginia Trioli: No, no. Don’t move my question onto something I said, Minister.
Alan Tudge: You said for several months’ people have been calling for this.
Virginia Trioli: For infrastructure spending.
Alan Tudge: And – well sorry, you didn’t actually mention that. You sort of said just for stimulus more generally.
Virginia Trioli: [Interrupts] Our entire conversation is about infrastructure, Minister.
Alan Tudge: Sorry. Just previously, as I say, stimulus spending generally. So the tax cuts of course have a stimulus impact, reducing interest rates has that stimulatory impact. And now, we have brought forward this. Now, we have been working carefully with the states and territories over the last few months to work out these plans which we have announced this week. Virginia, you can't -you can't ring up one day where the State Government calls you up and says: oh, can you please deliver three billion dollars and the next day we write the cheque for it. You don't do it like that.
Virginia Trioli: [Interrupts] No. But you can do it over a period of eight months which you didn’t.
Alan Tudge: No. Well we actually have worked very methodically through this. It was back in May when we increased the expenditure on infrastructure from $75 billion to $100 billion …
Virginia Trioli: [Talks over] And the calls came to release it.
Alan Tudge: … and the post-election …
Virginia Trioli: [Talks over] The calls came from all of these august people to release it.
Alan Tudge: … post the election, we’ve been working with the states and territories saying: are there projects which you can accelerate? Because not all projects you can accelerate by the way. Some of the very large scale projects do take two, three or four years to get going whereas we wanted to identify projects which could get cracking within the next six to 12 months. And that's what we've been methodically working with the state governments on.
Virginia Trioli: Well Victoria’s had a number of those and of course a number underway. What I understand is that you've got, or we have Victoria I think about $200 million is now coming in for the North East Link and seven million dollars for railway car parks. So $207 million in the next twelve months, as I understand it, to Victoria, out of this brought forward money. Again, not really much you’d chuck a ticker tape parade for, is it?
Alan Tudge: Well so this is money which is specifically being brought forward.
Virginia Trioli: [Talks over] Yes.
Alan Tudge: Now, you've got to …
Virginia Trioli: [Talks over] That’s right.
Alan Tudge: … remember in the May …
Virginia Trioli: [Talks over] That’s not much is it?
Alan Tudge: … well in the May budget, we allocated $6.2 billion extra money to Victorian infrastructure projects. Now, it had the largest share of anybody in the country, about 30 per cent of the share.
Virginia Trioli: I still don't think we have an answer there to what's actually been gained by hanging on to this infrastructure spending money.
Alan Tudge: Well I don't- I don't accept the premise of your question that we're hanging on to the infrastructure …
Virginia Trioli: [Talks over] There’s no premise, it’s just a question. Well of course you did …
Alan Tudge: … that we’re hanging onto the money.
Virginia Trioli: It was announced then it hasn't been spent.
Alan Tudge: But all of these projects, as I said, you can't- you can't just roll out money tomorrow if the projects haven't been scoped and aren’t shovel ready to go. That’s why we …
Virginia Trioli: [Interrupts] Oh I think Infrastructure Australia has established there’s been plenty around the country ready to go.
Alan Tudge: No. Well hang on, I mean this is why we've been working with the states and territories. If you ultimately do the actual build on the ground, asking them, dealing with them state by state as to what they can do and then matching our money to what their schedules are. So we've been announcing this week and I've been just in Western Australia a couple of days ago, announcing packages there. What can you bring forward and get cracking next year? Not in three years’ time or four years’ time, but next year.
Virginia Trioli: Minister, I've got to move on but I did have just one final question for you and again, it's some another big topic that's been coming up again and again and the Prime Minister has been addressing. But I don't want to go down to that argument that’s constantly had with the Government about climate change and bushfires and when is the right time or not but my question for you is this: why is it so important to your government that there be no link made between Australia's emissions, its connection to climate change and a dangerous increase in bushfire risk? What I really want to understand is the intellectual underpinnings of that resistance. Why do you resist that connection?
Alan Tudge: Well I don't think anybody has said that climate change is not a factor which may contribute to a higher bushfire risk. But the Prime Minister was careful to say that climate change is a global thing and we're only 1.3 per cent of emissions. And so had …
Virginia Trioli: [Interrupts] That's the link - let me jump in and clarify, that's the link that I'm pressing you on. So the link that our emissions, Australia's emissions, its connection to climate change and that connection to a dangerous increase in bushfires. Why are you so reluctant to make that link? Just tell me the why.
Alan Tudge: Well because it's- we've got our emissions policies in place in Australia. Had we proceeded with Labor's carbon tax, it would not have prevented the bushfires which are going on today, Virginia, and it is wrong to suggest that had we had a carbon tax in place, we would not have had bushfires in place.
Virginia Trioli: [Interrupts] That’s actually not an answer to my question.
Alan Tudge: But this is effectively what some of the critics have been suggesting, particularly the Greens. They’ve been basically saying that because we didn't have the carbon tax in place, we have bushfires today and that is absolutely wrong.
Virginia Trioli: Why don’t you concentrate on my question which is why you resist that link between emissions and the role that we play?
Alan Tudge: But I don’t think we have, I mean …
Virginia Trioli: [Interrupts] Well you do.
Alan Tudge: Well I think - and as I just said, I mean it’s a …
Virginia Trioli: [Interrupts] Well the Prime Minister was very specific in saying …
Alan Tudge: [Talks over] The climate change – I mean, people have to …
Virginia Trioli: … in saying that emissions will have no link.
Alan Tudge: … understand and people do. I mean everybody understands that climate change is a global thing not a local thing. We've all got to do our share and absolutely Australia doing its share in terms of reducing emissions. We’ll be hitting our 2020 targets smashing it; we'll be hitting our 2030 targets and smashing those as well. But this concept that had we had the carbon tax in place or the CPRS in place, we wouldn't have the bushfires is frankly offensive to those people who have suffered bushfires in the past.
Virginia Trioli: I don't think anyone’s saying we wouldn't have bushfires. But the link is real, the link is there and your Government resists it. I guess we don't have an answer to that today, you know, maybe another day …
Alan Tudge: Again, I think we're splitting hairs here, Virginia.
Virginia Trioli: Oh no.
Alan Tudge: The- I think we are …
Virginia Trioli: [Interrupts] Oh no. I think that’s a really crucial point.
Alan Tudge: I think we're splitting hairs here because …
Virginia Trioli: [Interrupts] Well that’s an interesting revelation if you think that’s splitting hair.
Alan Tudge: Well because the Prime Minister has said that it is one factor which goes towards the multiple factors as to why there is bushfires going on. But we've had bushfires in this country for as all of human history in this country which is a very, very long time. I mean I remember the Ash Wednesday bushfires and we had to evacuate from the Dandenongs when I was living at the time. I mean that was well before the climate change debate started, Virginia, and not to mention that we've got the Black Saturday bushfires which were catastrophic …
Virginia Trioli: [Interrupts] And we’ve got some terrible ones to look forward to this summer as well. Alan Tudge, really good to have you on the program. Come back again.
Alan Tudge: Thanks very much, Virginia.
Virginia Trioli: Alan Tudge, the Minister for Population, Cities and Urban Infrastructure.