Television Interview, NewsDay News24

SUBJECTS: Australia-US relationship; Middle East conflict; Defence spending; US force posture; data centres in Australia; Property Market

HOST, KIERAN GILBERT: Deputy Prime Minister Richard Marles joining us from Washington. Given the intensity of the pressure that Secretary Hegseth is under over many things, Iran particularly, was he happy to see a friendly face? 

DEPUTY PRIME MINISTER, RICHARD MARLES: Well, look, we had a really good meeting and the truth is that I've only ever had good meetings with Secretary Hegseth but we were meeting on what is a really important occasion because this is the 75th anniversary of the ANZUS treaty, our formal alliance with the United States and it really was a moment to reflect about how significantly we've worked together over that entire period of time and in fact prior to that.  The work that we are doing today, the way in which our two defence forces are so closely embedded and integrated with each other and the programs and challenges and progress that we're making in terms of what we have ahead and AUKUS is a good example of that and it's going well.  We're meeting the time lines that we have in respect of that.  This was my, well it's actually my first visit to the US this year, but it was an opportunity and having announced the National Defence Strategy in April of this year to talk through with Secretary Hegseth what we're doing, what we're doing with our increasing in defence spending, what we are doing in terms of our forced posture. 

So we had a really good meeting and we also -

GILBERT: I do want to - I want to explore that with you - 

MARLES: Doing AUSMIN in a couple of months’ time. 

GILBERT: AUSMIN before the end of the year absolutely so, but I want to drill in to that in terms of the spend in a second, but just on Iran, did he give you a sense of their mood, optimism, lack of, when it comes to Iran that - any sign that it's going to finish or end any time soon? 

MARLES: Well, look, we obviously spoke about the Middle East as we spoke about the strategic landscape through the Indo-Pacific and around the world as you would expect and I'm not about to go into the detail of what we spoke about in relation to that. You know, I think from our point of view obviously we've articulated consistently we want to see a de-escalation in the conflict in the Middle East, but also what's really important is that we see the Strait of Hormuz be opened and that Iran is seeking to limit shipping through the Strait of Hormuz is a breach of the UN convention on the Law of the Sea, on freedom of navigation and it's fundamentally unacceptable, and - 

GILBERT: Will it be over any time soon? 

MARLES: That we do see global fuel supply chains return to normal. Well, I mean it's - I'm not in a position to answer that - but what I can do is state where Australia is at and we want to see a de-escalation, we want to see the Strait of Hormuz open. 

GILBERT: Okay. Is Secretary Hegseth still not convinced that Australia is spending enough on its own defence? 

MARLES: Well, I think we've got a good story to tell and we tell it, and I think it's understood here. I mean, we've increased defence spending in 2023 - 

GILBERT: He’s still not convinced though? 

MARLES: ‘24 and ‘25 in four successive years. I think people understand that the very significant steps we've taken in increasing our defence spending. I mean, this is the biggest piece time increase in defence spending in our nation's history and at 2.8 per cent of GDP, you know, we are ahead of Britain, France, Germany, Italy, Spain. We're ahead of almost every country in the Indo-Pacific. So if you look at America and its allies around the world actually, you know, we're in a leading position in terms of what we're spending on defence right now and what we're doing and in terms of the quality of that spend, and increasing our defence capability. And all of that is really well understood here. 

GILBERT: But still in the read out the Pentagon put out they say they want more? 

MARLES: Well, I mean, the American position is understood but it's still very much understood with the steps that we've taken and what we're doing. And I think that is something that is appreciated and when you look at where we're at relative to other American allies and partners around the world the fact of the matter is we're leading the way. 

GILBERT: Did you explain the Henderson Shipyard, that build is part of your explanation of the - what we're doing, because obviously that's a huge investment but important to the US in terms of that the rotational force west, the submarine force that will be going through. I know in terms of the statement as well we spoke about accelerating force posture, that's central to that isn't it? 

MARLES: Yeah. So I mean in respect of Henderson we did speak about that, and as we spoke about the Submarine Rotation Force-West which will be established HMAS Stirling south of Perth at the end of next year and in fact we've got American personnel who are at Stirling right now in preparation for the commencement of SRF-West next year, but we also spoke about the Henderson Defence Precinct, the significant funding that we've put aside for that but also the decisions that we've announced in the last couple of weeks around the specific citing of the Henderson Defence Precinct and how important that will be, how important actually both Stirling and Henderson will be to enabling greater maintenance. Because what it does is enable greater maintenance of Virginia class submarines in the US Navy, and that provides for more sea days for the US Navy, and that's actually what ultimately creates the space for America to provide Australia's Virginia class submarines in the early 2030s.  In terms of force posture more generally, we did talk about expanding the breadth and the complexity of what we're already doing in relation to force posture. We will have more to say about that at AUSMIN in a couple of months, but again when you look at the successive AUSMIN meetings that we've had over the last four or five years, I mean what you've seen is a real deepening of the force posture of America and Australia. 

GILBERT: So will there be more numbers? 

MARLES: - two defence forces. 

GILBERT: When you talk about deepening and expanding it - 

MARLES: It's not really about numbers - 

GILBERT: Will there be more numbers, marines, submariners?

MARLES: Well, the significant numbers that exist right now are in both of what you just said actually, the marines and submariners and a lot of that has already been announced, so none of that changes. And that's where the, you know, you see the significant numbers of personnel. What we're really talking about here is deepening the complexity, increasing the breadth of what we're already doing across the various domains, land, sea, air, but also cyber and space. So that what American force posture in Australia represents is a much more broad and complex engagement across our defence forces in terms of the activity that we are doing.

GILBERT: You met with your counterpart, your Deputy PM, Vice President Vance, you met at the White House.  Did you raise with him Australia's concerns about the recent hike in tariffs up to 12 and a half per cent? 

MARLES: Yes, I did and in that I very much echoed what the Prime Minister raised in his meeting or his phone call I should saw with President Trump and the readout of that meeting between the President and the Prime Minister was the President would take in what consideration what we've said and in my meeting with Vice President Vance today there was a similar response. But it is important that we are making this case, obviously we would prefer that there are no tariffs at all but we are concerned about the increase that has occurred and I made that very clear. 

GILBERT: Any prospect they might reduce? Or remove? Or is that dreaming? 

MARLES: Well, all I can really reflect is that what you saw coming out of the call between the Prime Minister and the President is very consistent with what the Vice President said to me today and as our Prime Minister has said, President Trump undertook to have a look at this. 

GILBERT: You've met both Vance and Hegseth over the last day. They're both being talked about as potential presidential candidates. Who would be better for Australia; who would be on team Australia out of those two? 

MARLES: Well, look, the last thing I'm about to do is weigh in to who should be the next American president; that's obviously a matter for the American people. 

GILBERT: Why not? 

MARLES: What I would say is that both people are great friends of Australia. Well, because it is a matter for the American people who they choose as their next President and the last thing I'm going to do is comment on that, but I mean in both the Vice President and Secretary Hegseth they are two people who really value the relationship with Australia and one of the opportunities of being here on the 75th anniversary of our formal alliance with the United States is being able to reflect upon what that alliance has meant to both countries over that period of time, what it means to us going forward and there's a deep understanding and a real affection and friendship that is held by both Secretary Hegseth and Vice President Vance, but actually everyone that you meet in Washington, the standing of Australia in this town and in this country is very good and it befits a relationship which is as solid as it's ever been. 

GILBERT: What about the standing in the other side of the country in California?  I know you were in San Francisco meeting with Anthropic, OpenAI, all the big tech. Any of those big ones, AI frontier companies going to set up in Australia as their second home? 

MARLES: Well there's an enormous opportunity here for the country in Australia being a place of investment by the frontier companies, by American tech and it's a huge economic opportunity but actually it's a really important national security sovereignty opportunity. It is an opportunity for us to be able to collaborate in respect of artificial intelligence and how it operates within our society but how it operates in respect of our national security and so that was certainly part of the case that I was making. Now in saying all of that, it's really critical that there is the appropriate social licence for this both in terms of how data centres operate, where they're located, making sure that there are proper planning decisions there, making sure that power comes with them and actually I think there is the opportunity- 

GILBERT: Could we see one of them set up here- 

MARLES: -to help contribute to the power grid. 

GILBERT:  -as a second home? 

MARLES: Well I think it's possible and we certainly see this as a huge opportunity for the country but again it's important that we get this right and the other issue here is in respect of copyright, making sure that we are protecting rights holders, that's journalists, news organisations but also creatives and so all of those were points that we made, but having said that, you know what we offer is a stable country, a Five Eyes country, with unique geography, with great infrastructure and with predictable laws, where if we get the social licence right those companies [inaudible] 

GILBERT: If Queensland and the Northern Territory, they want to get AI investment in and they can use gas to speed that investment up, the government surely won't block that investment if it can be done speedily on the basis simply that they have to use renewables? 

MARLES: Well, I mean the Prime Minister has spoken about this. I think and he's made that position of the government clear. I think I'd make a couple of observations: one is that when you're talking to the American tech companies they really are seeing this over a long period of time and their head is in the renewable space. So I think that's the way the tech companies themselves are approaching it. What matters is that we get the power equation right. Like, it matters that they are contributing power to the grid to meet their power needs and of course their water needs which ultimately I think becomes a function of power and what there is if they do that - 

GILBERT: Block it if the opportunity- the Top End could get in investment using gas, I mean you're not going to block that happening surely if it's just using one energy source. We need this investment don't we? 

MARLES: Well investment is definitely really important and the Prime Minister has addressed the very question that you're asking. I think the point about this in terms of making sure that we get the power equation right is that this has the opportunity to harden our network around Australia and that will I think be a really big opportunity for the country. We need to get the social licence right here. It is about those data centres and how they're established. It is about issues such as copyright but if we can get that done this is an incredible economic opportunity but it's so important for our country's national security and for our sovereignty. 

GILBERT: Finally, just one back home but it's a big one, the cooling property market. If the government decides the tax changes adversely affected the property market in a few years from now, are you open to possibly revoking them, changing them like Paul Keating did back in the 80s? 

MARLES: Well I mean, firstly we've made the decisions we've made and we are moving forward on that basis. Now, beyond that I'm not about to go into what is happening at home. I'll leave that to those who are in Australia right now to comment on that and I know the Treasurer has spoken about this so I'll leave the further commentary to him, but we've made the decisions that we've made in the budget, we're obviously engaging in consultation in respect of some of the other aspects of our tax changes but we've made - 

GILBERT: You're not inclined to revoke them? Okay.

MARLES: The call we've made in terms of- well what it's about is getting the next generation into the housing market so that the owning of an Australian home is not just the dream of someone of my age but it's the dream of our kids as well. 

GILBERT: Richard Marles, I appreciate you making the time from Washington. It's been a big day for you. We'll talk to you soon. 

MARLES: Thanks Kieran. 

ENDS