Radio Interview, ABC Melbourne

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The Hon Richard Marles MP

Deputy Prime Minister

Minister for Defence

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02 6277 7800

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15 May 2024

SUBJECTS: Federal Budget, Hamas-Israel Conflict.

HOST, ALI MOORE: The government is out selling the Treasurer's handiwork today. Richard Marles is the Deputy Prime Minister and the Minister for Defence. Richard Marles, welcome to Drive.

DEPUTY PRIME MINISTER, RICHARD MARLES: Good afternoon, Ali. How are you?

MOORE: I'm good. Can I ask you- sort of a little bit off topic, but strange question in a way- but I'm really curious, how much of what is in the Budget, do you know, word-by-word, before Jim Chalmers gets up and speaks?

MARLES: Well, firstly, the Budget, if we're talking about the whole Budget, it runs to thousands of pages, and so I wouldn't claim to have committed all that to heart. I sit on the Expenditure Review Committee, so I've been more involved in the framing of the Budget than most- and that is an exhaustive process which really kind of finished about a week and a half ago. You know, I've had the benefit of seeing the sorts of things that Jim was planning to say last night, which really, I mean, his speech last night seeks to pick the eyes out of the Budget in terms of the decisions that we've made, but also provide a narrative, tell the story of what the Budget's about. So, I mean, Jim is very collaborative in the way in which he goes about his business. So, I did have an opportunity to see how his speech was going to look. So, in the broader sense, you know, I've been in a position where I have been able to see the Budget take shape, really, over the- where are we now, May- probably the last, last four or five months. I mean, it's a considerable process to get to this point.

MOORE: And I mean, of, I suppose, what was said last night, the big headline for many people is the $300 energy subsidy. Why wasn't it means tested?

MARLES: Well, I mean, there are some things where you walk down a targeted path and others where you don't, and these are matters of judgement, but it is about having a balance between the two. And so we, for example, have increased rent assistance, which applies to a significant number of Australians, but a minority. And indeed, this Budget has an increase in rent assistance, as the last one did- and that's the first time we've seen back-to-back increases in rent assistance in more than 30 years- and that's a very targeted proposition for our most vulnerable. But on the other hand, cost of living pressures are being felt across the community and so it's valid to then have some other measures which are there for everyone and it's a matter of getting the balance right. And the judgement we made in relation to the energy rebate is that this was something that should apply across the board. Its not- not everything in government is means tested. I mean, people are talking about those who are very wealthy have access to this, but those who are very wealthy have access to Medicare, they have access to public schools. I mean, there are a range of things that are provided by government in our community which are universal in that. So, it's not a radical proposition.

MOORE: Sure, I take that point, but this is obviously an exceptional thing because it's a cost of living measure that's been put in a Budget and it's only a temporary measure, it only goes for the year. And doesn't it open you to the criticism that it is really all about getting the measure of inflation down? That basket of things that goes into measuring CPI, energy prices are one of it. So, if everyone's bills got $300 knocked off it that does mean that inflation will be manufactured. Inflation will be a bit lower. It doesn't change underlying inflation inflation, but it does mean that inflation might look a bit better.

MARLES: I don't accept that. I mean, I accept part of it in the sense that we make no apology for the fact that we are seeking to fight inflation and what's within our power in terms of the way in which the Budget is framed- and that's a significant part of it- is something that we are going to use in every way we can to try and put downward pressure on inflation and this is part of that. And it impacts underlying inflation as well. The inflation is what is at the heart of the cost of living pressures that people face. And so, ultimately prudent economic management is what we need to be engaged in and we have been engaged in that. The fact that we've produced two surplus Budgets in two years says something about the way in which we've gone about our business in terms of economic management. But to the extent that we have done spending, that spending in turn has been focused on easing the pressures on cost of living, because that is clearly the issue which is out there. And yeah, we need to be focused on our most vulnerable and we are in a lot of ways, but it's appropriate to have measures which apply to across the board as well.

MOORE: But you've heard from ACOSS, you've heard that. And I got a whole lot of text along the lines of, well, I don't need it, so why didn't you put more? You might have been able to bump up allowances for other people if you hadn't made this subsidy across the board.

MARLES: Well, and again, how you- there are practical ways in which you frame these things. So, in an administrative sense, means testing comes with a cost. So, you look at ways in which you can most practically put in place measures of this kind. Now, you know, ultimately, what we were doing here was not driven by the administrative issues, but they are part of it. What we were doing here was driven by the fact that we wanted to have an across the board measure, because everyone across the board is being impacted by cost of living pressures. But it doesn't mean that that represents the entire philosophy of the Budget. As I say, there's a whole lot of other measures within the Budget which are targeted. And it is about getting a balance. Some things should be targeted to our most vulnerable. We're a Labor government, so unsurprisingly, that is a considerable focus of the Budget. But people across the board deserve assistance as well, and that's what we're doing with this measure.

MOORE: You're listening to the Deputy Prime Minister and the Minister for Defence, Richard Marles, talking about the Budget that was delivered last night. Richard Marles, another big part of the Budget, obviously, is a future made in Australia policy; $23 billion over ten years, and a lot of focus on green hydrogen. How do you know as a government that you're placing the right bets?

MARLES: Well, I mean firstly, we are looking at- I mean, what we are seeking to do is increase expenditure or increase investment, I should say, in renewable technology. So, across the board we are trying to look at ways in which we can encourage that. There are areas where we have national strength; critical minerals, for example is an area where we have national strength- we have national strength because those minerals exist within our country. And so putting in place the critical minerals production tax incentive over the next few years is a measure which we see as playing to our national strength. And the same goes in respect of the hydrogen production tax incentive. I mean, the opportunities for hydrogen production in this country, are among the very best in the world, in the sense that our renewable resource lends itself to the production of hydrogen-

MOORE: Sure. But I guess my question is, green hydrogen is not at scale the success that it would need to be. You're making a bet on it. I mean, you're punting on it. That's where you're putting a lot of the focus. How do you know it's the right one?

MARLES: Well, it's not- again, I don't accept that language. It's not like we're walking down to Sportsbet. I mean, a whole lot of research is done here on where our national strengths lie, and our national strengths lie in relation to renewables. I mean, the most consistent wind source on the planet are the Roaring Forties. Australia has the longest adjacent coastline to the Roaring Forties of any country in the world. It means that the wind resource in Australia is better than any country in the world. In terms of solar, the quality of the solar radiation, meaning the ability to convert that to electricity, is only surpassed in the Sahara- and we are much better placed to be able to exploit solar energy in this country than the countries surrounding the Sahara desert. Now, you take those two facts and there's no punt in that, that's what science tells us. That's where you understand the renewable resource that exists in this country and the opportunity that comes from it. And converting renewable energy into hydrogen through the electrolysis of water is the opportunity which exists here. And it's one of the huge opportunities going forward in terms of producing a renewable energy future. Critical minerals, you know again, we're not betting on that, critical minerals exist in Australia- we know that. And so what we're doing here in both of these measures is in understanding what our resources are. We are playing to our strengths. And that’s what underpins these policies.

MOORE: And playing to strengths, but the money really doesn't start to flow until 2027, particularly given what's happening in the US and the EU, in terms of subsidies that are being provided for these sorts of projects, and the fear that so much money is going to be sucked in the direction of the US and the EU. Is time not of the essence in this country?

MARLES: Yes, it is of the essence. But this is happening within the timeframe that will enable us to do this. So, yeah, look, in the grand scheme of things, we need to get on with this. But doing this in 2027 meets that timeframe, is what I'm trying to describe. And so we see that there is the opportunity, and again, this is the advice about how long it would take to develop these industries. And when you get a production tax credit flowing, that that is a timeframe which allows those industries to be developed and those industries operating, or rather, I should say, that incentive operating through the back end of the 2020s, through the 2030s is what we need to have in place in order to really develop those industries at scale in Australia, which is a huge opportunity for our country.

MOORE: Richard Marles, just a completely different topic, but I'm sure that you're aware that this afternoon in Canberra, the Labor Senator Fatima Payman, has broken ranks with your party, with Labor. They've accused Israel of committing genocide against Palestinians in Gaza. They've questioned how many deaths will be enough for Anthony Albanese to declare enough. What's your response to what a Senator from your party has said?

MARLES: Look, what we are seeing play out in the Middle East is an absolute tragedy. I think that's one point on which everyone can agree. I think we can all agree as well that every life matters the same. The deaths that we saw on October 7 were an outrage, but the thousands of innocent Palestinians that we've seen losing their lives is also an absolute tragedy. And that's why we have focused all our international advocacy towards calling for a humanitarian ceasefire. I think the whole world wants to see this tragedy brought to an end. And in bringing it to an end, we understand that lasting peace in the Middle East lies in a two state solution, which has been the bipartisan position of governments in this country over the course of decades now-

MOORE: But is it appropriate for a member of your government, for a Labor Senator, to use the word genocide?

MARLES: Well, it's not the word I would use. And what we are focused on is using our advocacy towards bringing this tragedy to an end and seeing that a lasting peace is achieved. And that that lasting peace is achieved on the basis of a credible pathway towards the establishment of two states. And that means a Palestinian state. But let's be clear in terms of that; that can't happen while there are hostages still being held. That can't happen with Hamas as a part of that government. And nor can it happen without Israel being provided security behind its borders. I mean, the whole world wants to see a lasting peace in the Middle East. That's how we are using our advocacy. But I also finally make a point in relation to this; I think we've seen demonstrations of Melbourne unit as well- It's really important that as people use their voice and they should legitimately use their voice, of course, in a free society, but that we do in a way which has an eye to social cohesion in this country. Part of why people are in Australia is because of the incredible country that we are and the bond that we share as Australians. And we really do need to have that front and centre when we are engaging in the advocacy which people will legitimately do about their views in respect to the Middle East.

MOORE: Richard Marles, thank you very much for joining ABC Radio, Melbourne Drive.

MARLES: Thanks, Ali.


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