PETA CREDLIN
Welcome back, you’re watching Credlin. At a meeting of the Commonwealth, State and Territory Energy Ministers just starting to break up and Chris Bowen who is the New Labor Federal Minister in the area has announced an 11-point action plan. He says it's been agreed at the meeting today to deal with the issue of gas and broader energy cost issues. He hasn't gone through all those points yet. I’ve got some comments he's made that I’ll play to my next guest and get his reaction, but there's certainly been a lot of debate today but not a lot of solutions. Let's bring in my next guest though, who knows this portfolio inside out, the former Energy Minister for the Morrison Government, Angus Taylor, who is now the new Shadow Treasurer for the Liberal Party. Angus, thank you for your time. Great to have you on the program. Congratulations on your new role. I think you've gone from the frying pan into the fire but we'll see where this goes. I want to play a comment from Chris Bowen. It’s just gone to air a moment ago. The government hasn't held back in accusing you in particular but the Liberal Party of leaving this huge energy mess behind you. They're just picking up the pieces of a crisis that you have left them. Here's Chris Bowen a few moments ago.

CHRIS BOWEN:
Now, the reason why we are in this crisis today is because there hasn't been enough planning about the changes that are necessary. The work that we took to the election is even more important. We need more transmission, we need more renewables, we need more storage.

PETA CREDLIN: 
What would you say to that? 

ANGUS TAYLOR:
Oh what a load of rot. I mean, Chris Bowen, instead of getting out and talking to the energy suppliers who can put more supply into the system and put downward pressure on prices, is having a gaff fest with bureaucrats and politicians. I mean, that's not the answer Peta. Worse than that, their plan features building transmission lines. Now this is like buying extension cords without a power point. He refused in the press conference we've just seen, what I saw of it, he refused to endorse the importance of gas or coal in the system. And frankly, you've got to have those supplies. You've got to have more supply. It's a very simple way to bring down prices. We did it and we saw increases in gas prices back in 2017. We put the ADGSM in place, a mechanism to ensure that there was enough supply going into the system and we saw downward pressure on prices. We worked closely with the gas companies and we worked closely to get more supply coming into the system. That's what you have to do and indeed we saw exactly that in the lead up to the election where the Australian gas price was sitting at about a quarter of the international price. Since the election, of course, we've seen things go the other way and Labor needs to sit down and get more supply into the system. It's very simple.

PETA CREDLIN: 
You left a framework in place why aren’t they using it? 

ANGUS TAYLOR:
Well, you know, Chris Bowen has never been able to endorse the role of gas. He thought our gas policies which focused on getting more pipelines, more transparency and more supply, were and I’ll quote, “B.S.” and “a fraud.” He just doesn’t like the gas industry. It's as simple as that. Now, if you want to get more gas out of the gas industry, you've got to work with the gas industry, and Chris Bowen has never been able to bring himself to do that.

PETA CREDLIN:
Yeah but if you want more power in Australia, right now, you've got to have gas, you've got to have gas as a firming technology. You've also got to have coal and this is where the left hand of the Labor Party isn’t talking to the right hand of the Labor Party because their new Resources Minister Madeleine King, she was out there today, really spruiking coal hard, says I desperately need it and I can't have enough coal, have a listen. 

MADELEINE KING: 
Everything's on the table, because it is a process so there's no time for the … it's not a time for the government to rule anything in or out. I think we need to make sure the tools that are available to government right now are made use of.

PETA CREDLIN:
So do they hate coal? Do they like coal? Do they hate gas? Do they like gas? I can't get a clean line from them.

ANGUS TAYLOR:
Well, you know, it's one thing in Western Australia with Madeleine King is from. It's a completely different thing in Sydney where Chris Bowen is and this is the point about the Labor Party. They'll never be able to agree on this. They don't know if they're Arthur or Martha on these issues. And we've seen this time and time and time again. And the only people who suffer in the end are Australian consumers and Australian manufacturing. And of course that's the real threat here in the very short term is loss of Australian manufacturing.

PETA CREDLIN:
David Littleproud, the new National Party Leader, he's written to the government today saying we've got to have a national conversation about nuclear energy but the Treasurer, he was at the Sky News Business Forum today, he completely rejected it. Have a listen.

JIM CHALMERS:
The reason that I'm not keen on nuclear energy for Australia is because the economics don't stack up. I don't think that they have actually ever stacked up in Australia but particularly the case as some of these cleaner and cheaper opportunities have the economics that it becomes so compelling.

PETA CREDLIN:
What do you think of that?

ANGUS TAYLOR:
Well, Peta, you know, Jim Chalmers has never had a job outside of politics. He wouldn't understand economics if he fell over it. He did a … He did a PhD thesis, which he claims to be on economics and it's a tribute to Paul Keating. So he doesn’t understand any of this, and sadly Australians will suffer because of this. The truth is, we need to have a discussion about nuclear. I put nuclear as an option on the table when I was Minister in the Technology Investment Roadmap. We’ve got Ted O'Brien who is now in the Shadow Ministry in this area to lead a Parliamentary Inquiry in this area. It needs to be part of the conversation. There is no doubt about that. The technology is changing. The costs are coming down. We're looking forward to seeing some of these small modular reactors as they're known, being built around the world in the coming years and we've got to be watching very closely because this has great potential to really move the dial and for Labor to rule it out in such a way is again, just typical of Labor's ideological view about what fuels are okay, and what fuels aren’t. 

PETA CREDLIN:
Alright. You're not an academic in a Treasury portfolio, you're one of the few in the Parliament that's actually had substantial business experience. We've got a lot of headwinds. I don't think you can divorce energy from the broader economy at the moment. I mean, it’s driving a lot of the inflation pressures. And we saw that rate rise yesterday. We're told these rate rises are going to be just a pattern of behavior for the next couple of years. People already feel like they're up to here, with their mortgages adding cost of living. Where is this all headed, Angus because these are challenging times aren’t they?

ANGUS TAYLOR:
They sure are. Look, three and a half million Australians yesterday learned that they were going to be paying a whole lot more per month for their mortgages, and that's on top of what's expected to come or what's expected to come is on top of that, so to give you an example a $750,000 mortgage you're paying $200 a month more now and that will go up as the RBA continues to hike rates. Now if you want to contain inflation, and you want to contain interest rates, you have to contain government spending. And there's an option straight away for the Labor Party to take the $45 billion of off-budget spending it committed at the election, they know that it's the wrong time to do this, including a hell of a lot of money spent on those transmission lines that Chris Bowen is so obsessed with. $20 billion on the $45 billion on that, so getting rid of that unnecessary spending is the key, Peta and this is a fight we're prepared to have. You know, if the government wants to spend more money in these places, people with mortgages will pay for it. There was a very strong signal sent by the Reserve Bank yesterday to the Labor Government which is that these hikes are going to be bigger than was expected. This was absolutely at the top end of the market’s expectations, which we saw yesterday and so containing fiscal policy and containing government spending is going to be absolutely crucial.

PETA CREDLIN 
You and I both having been around government that, that is absolutely correct. That, that nexus point you talked about there from government spending allied with where rates will go but I guess the prosecution of that will be your big job for the next few months as we get into the period, in October, we're told that Chalmers is going to have an update to the budget so more strength to your army Angus Taylor, thank you for joining us.