Member for Isaacs

Sky News The Nation 13 October 2011

13 October 2011

Subject: Refugee policy and carbon pricing

Cabinet Secretary
Parliamentary Secretary for Climate Change and Energy Efficiency

13 October 2011

Subject: Refugee policy and carbon pricing

David Speers: Welcome to the program. It’s been a rollcoaster ride for the Gillard Government this week,
from the highs of passing the carbon tax, to the lows of conceding defeat on asylum seekers. Both issues
Julia Gillard vowed to fix when she took over as Prime Minister. Joining us this week the Parliamentary
Secretary for Climate Change, Mark Dreyfus, Sky News contributor and host of Saturday Agenda, Chris
Kenny. Former NSW Labor Minister and the author of the Fog on the Hill, Frank Sartor and also the
Shadow Health Minister, Peter Dutton, welcome to you all.

I want to start with what has been a developing story and that is the mess that we have been left with on
asylum seekers, after neither of your parties was able to reach agreement on how to proceed with off‐
shore processing.

The Government wants Malaysia, the Opposition wants Nauru, why can’t you come to some form of
accommodation, Mark Dreyfus?

Mark Dreyfus: We don’t just want Malaysia, we want to restore the Migration Act to the position it was
understood to be before the recent High Court decision. As the Prime Minister said in her press conference
this evening, we want to pursue that Malaysia agreement and we will continue with that. We are hoping
eventually Tony Abbott comes to his senses and begins to act in the national interest, because we think it
is in the national interest to pursue that arrangement with Malaysia.

It offers, really, a first step in building a regional architecture, building arrangements with what you could
call transit countries trying to get regional burden sharing, if you like. We are being prevented from proceeding with that at the moment because the amendments are not able to go through the House of

David Speers: Peter Dutton what’s your view on the same question?

Peter Dutton: Well David I think there is a complete lack of leadership and I think there has been a lack of
leadership on this issue since Kevin Rudd was Prime Minister. The Government had in place a formula
which worked, it stopped the boats. We didn’t have the rioting going on in detention centres. We didn’t
have the uncertainty, we didn’t have the green light for people smugglers to continue to push people onto
these boats and the Government dismantled what was a good system.

Kevin Rudd did it and Julia Gillard has only compounded now into what is a national joke and as I
understand it, and as you say, it is a developing story, but I believe the Prime Minister was rolled in caucus
this afternoon on this very issue and I think that is a major development. I guess that story will develop
tonight and over the weekend.

David Speers: What’s your understanding of...

Peter Dutton: Well my understanding is that the Prime Minister went in there with a discussion about
Malaysia being on the offer for caucus and they went to this ridiculous arrangement of allowing bridging
visas and basically just raising a white flag and saying to people smugglers “come on down!”
David Speers: But she remains very much in favour of proceeding with the Malaysia agreement. She is
saying that it is up to Tony Abbott, it is up to the Opposition now to come on board.
Peter Dutton: But this is developing into a national joke. I mean does this Government have a list of policy
options and feel compelled each and every occasion to choose the worst possible option? I mean is
anybody seriously suggesting that Tony Abbott is the cause for the Labor debacle, in terms of their policy
on Malaysia and you know, weakening our border protection? I mean this is really, I think a serious joke
and a lack of national leadership. She is completely undermining the office of the Prime Minister at the
moment. And I think Julia Gillard’s position has become more tenuous.

David Speers: Okay, in fact we did hear the Opposition calling for her to resign...

Peter Dutton: Well if Chris Bowen doesn’t feel the need to resign now, I am not sure when he would.

David Speers: Alright, Chris Kenny, do you think there should be some sort middle ground between the
two parties on this?

Chris Kenny: Well I think there is middle ground being put up. The Opposition has put up this amendment
to the Government’s amendment, which would allow off‐shore processing in countries that are signatories
to the UN Convention on refugees.

David Speers: But how is that middle ground? Because it knocks out Malaysia and it wasn’t the
Opposition’s policy under John Howard.

Chris Kenny: Sure, there is a bit of political opportunism in here as well. But Julia Gillard has said
previously that she wanted to deal with countries that are signatories the UN Convention. Well here’s an
option to do that. We have seen Nauru and Manus Island work in the past, we can try them again and Julia
Gillard has been too stubborn to adopt this position.

So what’s she has done now is after years and years of saying that off‐shore processing was wrong and
that on‐shore processing would not be an incentive for people smuggling. She is now saying that on‐shore
processing will attract more boats, it is an incentive and what she needs to fix the problem is off‐shore
processing. It is a complete turnaround.

David Speers: Frank Sartor, there have been twists and turns in Labor’s position on asylum seekers over
the years from completely opposed to off‐shore processing to saying there is no such thing as pull factors,
to then embracing off‐shore processing. Trying to get East Timor, trying to get Malaysia, now back to on‐
shore processing under some duress, it has been a circuitous route.

Frank Sartor: I think it is fair to say that they had some false starts and that has done them some political
damage, but if we go to where we are now, the reality is that what was bluff, the Howard bluff, which
worked well for a couple of years, may not work again. So what you actually want in immigration policy
and thankfully I am not in the Federal Parliament to deal with this, but you do actually need policy
flexibility. You absolutely have to have it because there is some significant doubt.
Whether the public servants are right or not is another matter. But there is doubt that Nauru will work. I
think you actually do need policy flexibility and I think the Opposition, with the greatest respect, are being
very opportunistic about this. The other thing that is also obviously very important is to engage the transit
countries more. I would like to see and I know they are doing a lot and I would like to see a lot more work
on actually “on the ground work” and stopping people smugglers on the ground in Indonesia, in Malaysia
or wherever.

David Speers: A lot of that requires cooperation from Indonesia.

Frank Sartor: But we have done it with terrorism and we have done with a lot of other things. I think we
did a lot more of that as well.

Chris Kenny: It’s not there problem though Frank this is the issue. You know, Indonesia, Malaysia, we do all
we can to involve them in the issue because of course they are transit countries. But they know, as we
know, that the objective is to get to Australia. The asylum seekers are not trying to get into Indonesia or
Malaysia to stay there. They are going there en route to Australia.
No you should try and work with them, but in the end they know it is Australia’s problem.

David Speers: Successive governments have done this. The Howard Government, the Labor Government.
Mark Dreyfus, what’s so bad about Nauru? Why won’t Nauru work?

Mark Dreyfus: Well just to pick up Chris’ point, it’s not a transit country. It doesn’t offer any prospect of
resettlement. It was a barbarous solution as implemented by the Howard Government.

David Speers: And Malaysia’s not?

Mark Dreyfus: And to pick up the point that Frank made, it was a bluff. A lot of what the Howard
Government did was a bluff and the advice that we are getting from the Department, in the clearest
possible terms...

Chris Kenny: Was it too tough or a bluff?

Mark Dreyfus: Is that Nauru will not produce anything like the effect that is desired, which is to disrupt the
people smuggling business.

David Speers: But just explain to me how it is barbarous?

Mark Dreyfus: Well it was barbarous to keep people there, years after they had been classified as
refugees, which occurred in a number of cases...

David Speers: But you have got people who are kept for years on Christmas Island.

Mark Dreyfus: Not for the same time that people were on Nauru, causing lasting psychiatric harm to a
number of people. Many of them now living in Australia as citizens and that’s something we have got to
avoid. We want to have humane treatment of people seeking asylum and humane treatment of people
who are refugees.

David Speers: But if we are so barbarous surely it would therefore be a deterrent to have that on the table
as a threat to send people there?

Mark Dreyfus: The deterrent was said to be that you did not get to end up in Australia and that has now
been made absolutely clear it was not the case that you did end up in Australia or New Zealand...

David Speers: But is that the point Peter Dutton, it worked once, but now the people know that if you go
to Nauru that you will end up in Australia?
Peter Dutton: No because we don’t talk about Nauru in isolation, it was a policy, which was one element,
one plank if you like. We insisted on temporary protection visas as well so that people knew that there was
essentially no prospect of settlement. That they could go back to their own country.

Mark Dreyfus: And that didn’t prove to be the case either.

Frank Sartor: Didn’t 90% of those become citizens?

Peter Dutton: Well let’s look at the facts Frank. I mean the fact is, when Mr Rudd changed this policy the
boats started to come. Now part of the reason why you’re not striking any luck in Indonesia at the
moment is because you completely trashed the relationship with the Indonesian Government.

Mark Dreyfus: Well I don’t accept that for a moment. We have got very, very good work going on now
with Indonesia and you should not be speaking in this way.

Peter Dutton: I think it is quite regrettable that you have Mark, but the live cattle export...

Mark Dreyfus: You need to be very cautious here, just as your colleagues need to cautious about the way
they speak about Malaysia and Chris will back me up on this. He has been to Malaysia recently. There is a
need for care in the way we speak about our regional neighbours. I can tell you, and David has adverted to
this, that we are working very closely with Indonesia on a whole range of counter‐terrorism measures and
we are working closely with Indonesia in relation to people smuggling.

I cannot say more than that and you would understand why. But to suggest that we have trashed the
relationship is a nonsense.

Peter Dutton: Well look Mark, you can throw all the red herrings in you like. The fact is, the way in which
we conduct relations with Indonesia is absolutely vital to our countries.

David Speers: Are you giving some sort of assurance that under the Coalition that you would be able to
strike a deal with Indonesia to send boats back?

Peter Dutton: No I am just saying that when we were in Government...

David Speers: But that’s the point though. You can’t give that guarantee.

Peter Dutton: No David, but if talk to people like Phillip Ruddock... Well hang on, just let me finish the
sentence... they were able to have quiet behind the scenes discussions with the Indonesians and they
were able to do that because the Indonesians were not scornful about domestic policy approach.

David Speers: So you reckon you will be able to do that again?

Peter Dutton: Well I think the Indonesians look at this current Government, they don’t know which
direction they are headed in. The Live Cattle export was damaging to our relationship, there is no question
about that.

David Speers: But are you saying that you would be able to do a better job of striking some deal with
Indonesia to send boats back?

Peter Dutton: Well I think we would be able to talk to the Indonesians about their own factors within their
domestic situation, the way in which their law enforcement agencies conduct their business, in terms of
the people smugglers in Indonesia. I think they’re the sort of private discussions that governments can
have if there is a mutual respect between the governments and I think at the moment that mutual respect,
certainly from Indonesia’s perspective, is not there.

David Speers: Let me ask you the flip side of the question I was asking Mark Dreyfus. What’s so wrong with
Malaysia? Why don’t you think that’s a good idea?

Peter Dutton: Well David I am pretty conservative, on the right politician if you like, and Mark is on the left
and I respect that. But I can tell you that Malaysia even offends me because I think of the options and I
look at Malaysia and I see the prospect of, you know, teenage boys and girls going to Malaysia. I think
there are real risks integrating those people into the Malaysian society. I think there are real people
smuggling and sex trade issues that operate across Asia, but I think it is an issue across Malaysia as well.

David Speers: So you are worried that asylum seekers, unaccompanied minors that we send there, could
end up being trafficked?

Peter Dutton: Well I just don’t know and that worries me and I am offended by it...

David Speers: What assurances can you give Mark Dreyfus?

Mark Dreyfus: Well if I can answer David’s question...

David Speers: Just on this point, what assurances can you give?

Mark Dreyfus: We are prepared to accept the assurances that we have received from the Government of
Malaysia because as our regional neighbour, we need to have, and you I think accept this, very sound
relations with Malaysia, just as we do with Singapore, with East Timor, with Indonesia, with our closest

We want to work with them. I find it odd that you suggest that somehow magically a Liberal Government,
were there to be one, could enter into side deals or backroom deals with Indonesia and that’s all right. But
to suggest that we cannot openly enter into an agreement as the Government of Australia with the
Government of Malaysia I just think is wrong. We accept the assurances that we are given, government to
government, by the Government of Malaysia and I think that is an appropriate way to proceed.

David Speers: Chris is that good enough? That we accept Malaysia’s word that these people will be okay?

Chris Kenny: Well I wouldn’t malign the Malaysian Government’s word but I think there are a couple of
problems with this and that is Malaysia is a country that doesn’t have a perfect human rights record, it is
not a signatory to the UN Convention. I think in the Nauru solution, what most people understand or I
hope they understand is that the Australian Government had responsibility for those people. They were on
Nauru but they were under the care and guidance, for health and education, processing of the Australian
Government. They didn’t just fob them off to another country, be it Nauru or Malaysia or any other
country. So I think that is part of the issue is that Australia needs to take responsibility for people that
come into its care.

David Speers: Frank Sartor, the situation now is that Julia Gillard is going to be trying to blame Tony
Abbott for every boat that arrives and Tony Abbott is going to be trying to blame Julia Gillard for every
boat that arrives. Who is going to win that political contest?

Frank Sartor: Well I think it is rather sad because I actually think immigration ought to actually be
bipartisan. It really ought to be bipartisan.

David Speers: It is never going to be is it?

Frank Sartor: Well it was for a long time till I think it was about, I think 2001, when they tried to make it a
political issue...

David Speers: It is now an issue with so much politics...

Mark Dreyfus: We had a period of bipartisanship at the time of the ending of the Vietnam War. Tens of
thousands of Vietnamese, many of whom have made a wonderful contribution to our country, came...

David Speers: Sure but in the last decade...

Mark Dreyfus: When the Fraser Government was in power, with the agreement of the Labor Party and
then when in Government, 1983 onwards, the Hawke Government assisted with a massive amount of
family reunion. And I didn’t take that...

Peter Dutton: And what was Paul Keating’s approach after that in terms of detention?

Mark Dreyfus: Well we can get to periods of...

David Speers: Let’s get to what’s happening now. I want to look...

Mark Dreyfus: Don’t assume that it is impossible, picking up Frank’s point, to reach bipartisanship...

David Speers: Well I think a lot has changed in the last 10 years...

Frank Sartor: Can I say that, I am an ordinary citizen now, thank god, I am no longer elevated like you guys.
Look, we just want this matter resolved. I think Abbott has to be very careful. He has been very sort of
ruthless and he has scored a lot of points, but I think he has really got to be very careful here. We want,
the citizens of this country, want this matter resolved in a reasonable way and the fact is we have got to
engage Malaysia, we have got to engage Indonesia, we have got to try and prevent people dying at sea. So
I think it is important to try...

David Speers: And some off‐shore processing... but do people blame the Government for not being able to
do that?

Frank Sartor: Well I actually think that it has moved on and it does need some flexibility Chris, I don’t think
anyone of these solutions is going to solve the whole problem. And when it comes to kids, that was
mentioned earlier, my understanding was that the Minister said that they would be dealt with individually
on their merits, in terms of his responsibility to children...

Mark Dreyfus: And very clearly, no blanket rules.

Frank Sartor: No blanket rules. So they will actually be dealt with. The thing is you can’t say, no Minister
can go out and say, well we will do something different with kids. You have got to be very careful in your
language, but the simple fact is that I think those issues would be addressed.

Chris Kenny: There is a complex range of measures, as Peter mentioned, there is temporary protection
visas, off‐shore processing, there is ways you deal with countries in the region. Especially Indonesia, the
cooperation you have. The issue here is, and I think the Australian public are on to this, the voters are on
to this, this is the point, is that up until three years ago this was fixed.
Tough measures that some people thought were too tough. Mark has just referred to them as barbaric,
barbarous, but they were tough measures and they worked and they stopped people taking dangerous
journeys and when the Labor Party took government, there were only six people in left in detention. We
now have 6,000 people in detention, more boats ready to come because all of this was unpicked.

Frank Sartor: My point is that it wouldn’t work today though. Well all the advice that bureaucratics have
been giving us and the fact that a lot of people who went to Nauru were able to come here.

Chris Kenny: They only know that because Julia Gillard and Chris Bowen have been out there pumping out
misinformation about 40% of those...

Frank Sartor: Well is it true or untrue?

Chris Kenny: Well the numbers... they have been saying that 90% of the people there came to Australia.

Frank Sartor: My understanding is...

Chris Kenny: 40% came to Australia.

Frank Sartor: My understanding is that close to half came to Australia, but a lot of those were resettled as
refugees. So it was successful for them. They got to be resettled as refugees.

Chris Kenny: But some were repatriated at the time and some went to other countries. So it worked as a

Frank Sartor: But at the time they weren’t signatories to the UN Convention were they?

Chris Kenny: Sure, but isn’t that a good thing if they still came to Australia and a deterrent as well?

Frank Sartor: But the Coalition has completely shifted ground. At the time they were happy to send them
to a country that was not a signatory, but now you have got to be a country that has to be a signatory. I
mean you guys are running the risk that sooner or later you will fall over the hill on this issue. You have
been doing well because the Labor Party did have a few misstarts during the election and so on this issue,
but I think it is reaching a point now where there is going to be a stark, there is going to be a much clearer
picture out there.

David Speers: Just to get back to the situation we are in now, Mark Dreyfus, what’s so wrong? If the
Government is so worried about the dangers, the risks people are taking, getting on these boats. There is
no doubt there is a big risk.

Mark Dreyfus: There certainly is.

David Speers: What’s wrong with trying Nauru and Manus Island again?

Mark Dreyfus: Because Nauru is a very, very expensive option. It is a small rock of an island, and I mean
small I have actually been there, right in the middle of the Pacific. It doesn’t have any refugees there, it
doesn’t have any asylum seekers...

David Speers: But it is very expensive to...

Mark Dreyfus: As Chris has, correctly, pointed out, it is effectively the notion of doing something on Nauru
as practiced by the Howard Government, that appears to be being suggested again. That Australia will
build a detention facility on Nauru. So it is not really anything to do with Nauru. By contrast, we are
wanting to engage with countries in the region, that is the point.

David Speers: By with Nauru, if it is an Australia run centre, you don’t have those concerns about what
happens to the kids, what happens with caning.

Mark Dreyfus: What is the point of sending anyone to an Australian run centre total is just the same as a

David Speers: Because is a rock in the middle of the ocean...

Mark Dreyfus: Well to torture people? To cause harm? To send someone for five years with an uncertain
future to a rock in the middle of the Pacific I say, at a humanitarian level, something amounting to torture
and I don’t think that Australia...

David Speers: Mark Dreyfus you are a lawyer, a QC, are you accusing the Howard Government of torturing
these people?

Mark Dreyfus: In certain circumstances, when someone has been given refugee status and is still
continued in detention, as occurred in a number of cases on Nauru, then I say that is not a humane way to
behave and could amount in effect to torturing someone because they have been given status as a refugee
and are still being detained.

David Speers: The Howard Government tortured these people?

Mark Dreyfus: I am not going to inflame it, if you want that inflamed. I am not going to say that...

Chris Kenny: This is just the ridiculous level of debate. On one level you are saying Nauru is bad because it
amounted to torture of people.

Mark Dreyfus: It could.

Chris Kenny: On the other hand you are saying that Nauru won’t work because it is too soft, they all know
they are going to get in.

Mark Dreyfus: No, it is about end outcomes. That is the advice we have had from the Department is that
the reason why it might have been that detaining people for a lengthy period was seen to be a deterrent
to people getting on leaky wooden boats in Indonesia. It is because there was some doubt whether they
would end up in Australia.

David Speers: A final question...

Mark Dreyfus: With Malaysia it is a start of the potential to enter arrangements with countries in the
region, to build on the Bali framework. And we need to have Tony Abbott starting to take the national
interest into account, instead of just the rank politics that he is practicing.

David Speers: A final question on this issue Peter Dutton. The Prime Minister’s argument is this legislative
change is about giving governments now, and in the future, the ability to choose what they do. So this
Government wants Malaysia, you may want Nauru in the future. You don’t have to back Malaysia to
simply give the Government of the day the power to decide what to do.

Peter Dutton: No, but as the point was made before David, I mean the halfway point really is to say, well,
yes we both agree with off‐shore processing, but only to those countries that are signatories to the

David Speers: But you didn’t used to say that though.

Peter Dutton: No but that is the reasonable...

Mark Dreyfus: Up until the 21st of June this year you weren’t saying it.

Peter Dutton: But that’s the reasonable middle ground. If you are asking for middle ground, yes we have
moved. But to you know, a more, I think, acceptable approach than the Labor Party...

Frank Sartor: A crafty approach.

Peter Dutton: But no, I think it is a sensible approach Frank. I mean the other problem of course that we
haven’t spoken about is that Malaysia is one part of today’s discussion, but the bridging visa is the other
part, which is the same two people who come on boats, now they will processed on‐shore, which is
another green light for people smugglers. And secondly, the people on bridging visas will be accessing
social security, they will be accessing employment, they will be accessing hospital services. Now if you
want to see a flood of people coming then you couldn’t have ticked anymore boxes.

David Speers: Well here are the other option is to have overcrowded detention centres.

Mark Dreyfus: And I have to just point out, that Peter’s described the situation that all of the people that
arrive by air and claim asylum. Who in almost all cases have come on some kind of visa but then have
converted to a bridging visa and are in the community.

David Speers: Let me see if I can finish on this issue on a point of agreement. No one seems to think that
on‐shore processing if a good thing? Is going to work? Is going to be effective?

Chris Kenny: I think the only thing we will all agree on is that what you want to do is stop people taking
these perilous journeys and prevent so many people from being stuck in detention.

David Speers: We will take a break and then move on to another area where I am sure there is going to be
so much agreement, the carbon tax. Stay with us.

David Speers: Welcome back. We’re joined this week by the Parliamentary Secretary for Climate Change,

Mark Dreyfus, Sky News contributor Chris Kenny, former NSW Labor Minister Frank Sartor, and the
Shadow Health Minister Peter Dutton. I want to move onto the carbon tax. The Government did have a
significant victory in the Parliament at least this week in passing the carbon tax bills through the lower
house. It’s a policy that still remains deeply unpopular in the community, but getting it through the
Parliament – Chris Kenny, first to you, was something that a lot of people would have doubted could ever

Chris Kenny: I thought it was always going to get through the lower house, and I think what’s a bit amusing
about this is that we’ve been here three times before, I think, where an ETS at least or a carbon price has
been through the lower house. What Julia Gillard really needs to do to claim her place in history is to get it
through the Senate and get it implemented and there are a few weeks yet before it gets through the

David Speers: Are you saying that there’s some doubt that it will go through the Senate?

Chris Kenny: Unlike Paul Howse, I wouldn’t bet my house on it.

David Speers: Well of course you were there amongst it last time around working with Malcolm Turnbull...

Chris Kenny: Indeed, indeed, I saw how close it could get then, and I think that we’re looking at a
leadership change in the Labor Party, and I think the most likely new...

David Speers: In the next few weeks?

Chris Kenny: In the next while. The timing is hard to pick and that’s the point I want to go to, if you were

Kevin Rudd, what’s the best thing to do? To have the carbon tax implemented and out of the way when
you take over, when you reclaim the Prime Ministership, or is the best thing to come in and scrap it and
say, “sorry, this is something we have completely messed up, the people have never really had a proper
say on this, I’ll take it to another election.”

David Speers: Frank Sartor, would you be advising Kevin Rudd to do any such bold move?

Sartor: Well, I think Kevin Rudd will be Minister for Foreign Affairs for a good while yet, so I don’t think
that we need to have the conversation. But I’m not so sure that there’ll be a leadership change, I’m not in
the federal caucus but I think after our experience in New South Wales and so on I think the federal
colleagues would be very aware.

David Speers: We might actually talk about the issue of the leadership later on.

Frank Sartor: We actually had a carbon trading scheme in New South Wales called the GGAS Scheme, and
the price peaked at one point at about $40 a tonne, no‐one even felt it. My son is in Paris, he’s about to do
a PhD. He’s an expert on carbon trading. In my phone, which I was forced to turn off, I’ve got all the stats,
what the carbon taxes are in Europe at the moment. Now,

David Speers: It’s currently running at about the equivalent of $14.

Frank Sartor: Yes, that’s the ETS for the EU, but Sweden is well over $100. Norway is partly part of the ETS
and partly some other streams are about $50 Australian per tonne. The UK is part of the ETS but it’s
putting a floor on its carbon price which is going to escalate way above Australia’s. I am told the ETS will
probably, depending on economic conditions, between $14 ‐ $15 and $40...

David Speers: the point is that we’re not acting alone here, and you’re...

Frank Sartor: We’re not. California is about to do something, New Zealand’s done something, while there’s
was very cautious and slow, other countries are doing different things. The simple fact is that I was in the
oil industry in the 1970s. I saw the first oil shock where oil prices went up by about a factor of ten and the
second oil shock where they doubled. The second oil shock the economies absorbed reasonably well
around the world. This impact on the Australian economy is miniscule compared to some of those other
impacts on economies like the second oil shock, forget the first one because that was massive, or for
example the GST. I actually think it’s an overblown issue, and pricing carbon is important if you want to go
to the “why we should and why we shouldn’t be sceptics” that’s a separate argument, but if you assume
that we need to do something, then I think we need to do it.

David Speers: Is it going to be, Peter Dutton, a miniscule impact? The Coalition’s been arguing the sky’s
going to fall in.

Peter Dutton: Well I don’t think that the Coalition’s been arguing that the sky’s going to fall in, but I think
there are some incredible economists out there and I think that there are, you know, millions of
Australians who all agree that this is going to have a big impact on their lives. I mean, the Prime Minister
talks about the 500 top emitters, but the fact is it’s going to have a cascade effect onto small businesses,
it’s not going to be like a GST where it can be a line item on an invoice, it’s going to penetrate every input
in a small business and those costs are going to be passed on.

David Speers: And then people will get compensated.

Peter Dutton: Well some people will get compensated, and in the end, after all of that big money wash,
we’re not going to have any environmental outcome, and we’re going to have the biggest system and the
biggest carbon tax in the world. And my favourite moment of this week in Parliament was the great kiss,
of course, of congratulations from Kevin Rudd onto the cheek of an awkward Prime Minister.

David Speers: We could see you guys enjoying it. Mark Dreyfus, you are the Parliamentary Secretary for

Mark Dreyfus: I am.

David Speers: So presumably you know more about this than the rest of us. But at $23 a tonne, it’s an
economy‐wide scheme, notwithstanding the sort of figures that Frank Sartor’s mentioned there, aren’t we
the only country that’s going to have an economy‐wide carbon price at $23 a tonne?

Mark Dreyfus: No, there are many countries that have got economy‐wide...

Peter Dutton: Economy‐wide, what are they, what are they?

Mark Dreyfus: I don’t accept that we are economy‐wide, but Frank is going to have a go at this too. We
have exempted agriculture for example. What is missing from the Liberal lines, which Peter has very
faithfully and loyally repeated here, is, as you pointed out, is most households getting assistance. It is
actually nine in 10 Australian households getting assistance. And everybody on the pension, everybody on
a Government benefit is going to get some assistance. There are nearly 30,000 people in Peter’s electorate
who are going to receive assistance.

That is benefit recipients and pensioners, and everybody under $80,000 a year income is going to receive a
tax cut. We have got a million Australians who will not be paying tax at all, and will not be filing a tax
return when the carbon price comes in because of the rise in the threshold. The Liberals always leave that

Peter Dutton: I’m keen to hear about these countries where there’s an economy‐wide carbon tax.

Frank Sartor: I’ll explain that.

Peter Dutton: Well I’m asking Mark. He says that there’s a number.

Mark Dreyfus: I’ll have a go first. All countries have got different settings, just as we’ve determined that
there shouldn’t be a carbon price on fuel, there shouldn’t be a carbon price on fuel for light commercial
vehicles and there shouldn’t be a carbon price on agricultural activities. So too every other country, New
Zealand being among them, they’ve got variations on where they put the settings because everyone’s
economy is a little bit different and in order to get emissions down you should concentrate. I’d say the
European schemes are also economy‐wide, even though they’ve got exemptions for various parts of their
economy for various industries.

David Speers: The European price though, which is most often compared to, the price is at the moment
only $14.

Mark Dreyfus: But if you had asked that two or three months ago, it was up a lot higher, and we have got
a temporary downturn in economic conditions in Europe, I think we are all too well aware of that...

David Speers: We hope it’s temporary, we don’t know.

Mark Dreyfus: Okay a present downturn, nothing’s forever!

Peter Dutton: You’d be following the European template for economic management at the moment,
wouldn’t you?

David Speers: The difference is we’re fixing ours for a few years at least.

Mark Dreyfus: For three years.

David Speers: $23 going up by 5% a year for those first three years. So for three years, Australian industry
could well be paying a lot more than its competitors.

Mark Dreyfus: Well it could be, but we think that the European price is going to return because this is
something that...

David Speers: Because the economic science is so strong, or?

Mark Dreyfus: There are a declining number of permits so the trajectory for the price and what this is all
about is predictability of price. The trajectory, the predicted trajectory, what everyone is working on in
Europe, is that the price is going to return to higher levels.
Frank Sartor: The EU scheme covers 50% of emissions in the EU. The Australian scheme is going to cover
about 60%. The Swedish scheme, I understand, covers closer to 70 or 80%. So in terms of the coverage of
emissions in the economy, the Australian scheme is quite comparable to the other schemes.

Peter Dutton: The coverage of emissions is a different definition from the coverage of the economy,
though, Frank. That’s quite cute but that’s quite deceptive at the same time.

Frank Sartor: Well when you look at the actual sectors they’re similar except the intensity of our emissions
is greater. We’re the highest emitting country per capita, second only to Luxembourg which is not a
comparable country. That’s why we need to be in a position to be doing something about it. Now you can
argue about the merits but I mean, look, whether it’s the carbon trading scheme or an interim carbon tax,
the fact is it’s about pricing carbon. And that’s always been the issue.

David Speers: Barring any extraordinary political developments this will go through the Senate next month
and then come into force mid‐next year. It raises the question how can you guys really get rid of it, and
particularly the compensation that Mark Dreyfus talks about, the tax cuts, the pension rising, are you really
going to unwind all that?

Peter Dutton: Well absolutely. And you referred to some of Chris Kenny’s mental scarring from a couple of
years ago when we lived through the first years of opposition, and look, whether it’s a level of pragmatism
that strikes or just a realisation that you’re at odds with the Australian people as we were at that time off
the back of Work Choices in the 2007 election, we took a decision to step back and walk away from that

David Speers: You’re investing a lot of faith in Labor suddenly changing their entire position.

Peter Dutton: Well if Labor went to an election today, I think that they would lose scores of seats.

Frank Sartor: That’s not rocket science.

David Speers: Few would doubt that.

Peter Dutton: I don’t want to be presumptuous but well...

Mark Dreyfus: That is why we get these desperate calls for an election all the time from Tony Abbott.

David Speers: Labor’s made it pretty clear, correct me if I’m wrong, Labor is going to stand by the carbon
tax, that’s the point Wayne Swan made this week, and even if you’re in Opposition you’re not going to

Mark Dreyfus: We have just legislated something that is an incredibly significant achievement for

David Speers: It’s been very politically painful; you’re not about to...

Mark Dreyfus: It certainly has been politically painful. It is something that is going to be of lasting value to
our children, our children’s children. It is going to put Australia on the trajectory that other countries are
already on of declining emissions. Australia is going to do its fair share.

David Speers: If you’re thumped at an election and you’re decimated, you get a new leader, are you going
to change and say...

Mark Dreyfus: I would go back a step and say I do not believe that Tony Abbott, even if he is still leader
and I think he needs to be watching his back because at least half of his party, seriously, support an emissions trading scheme and we know this. If Tony Abbott were to win an election in two years’ time, I do
not think he will carry out this supposed blood oath, he likes to use this sort of colourful language, to
repeal the carbon price that we have put in place. Because it will be already in. People around Australia
will have seen the minimal effect, it is about a 0.7 per cent rise in the CPI, will understand that all of this
scare campaign, the misinformation that the Liberals have been putting out was basically nothing. And
they will say what on earth were you banging on about? There will not be the kind of Liberal‐induced
hysteria that is the current climate and I think that very much in two years’ time, after the carbon price has
come in, we will have a very different political system.

David Speers: So back to this of how you get rid of it. If Labor is going to stick to their guns on the carbon
price, even in Opposition that means a double dissolution is required. That would take a lot of time,
probably 2015 before you can do that.

Peter Dutton: Well if it needs a double dissolution then that’s what we’ll do. And I think presumably we’d
have the numbers in the lower house in that scenario of course, and I think if people are serious in their
belief and I think that will continue in the public’s mind, to honour our word which we absolutely will, then
that means a double dissolution election. If the Labor party in the Senate decide that they hold their
ground and effectively cause a double dissolution election. If that’s the ground that they want to fight...

Frank Sartor: Peter, what if it’s working well, what if the tax is in, it’s working well and the industries are

Chris Kenny: What, the planet’s cooling down?

Frank Sartor: No, no, not the planet, that’s completely misleading and you know better.

Chris Kenny: How silly of me to suggest that the carbon tax might be about cooling the planet. This is all

Frank Sartor: You want to debate the science of it, I’m happy to do that. But that’s a misleading statement.
No‐one’s claiming that the carbon tax is going to cool the planet. It’s about slowing down the growth and
influencing the world to do its bit as well.

Chris Kenny: How will we know it’s working then?

Frank Sartor: I’m talking about it working in terms of the economy absorbing it without significant

Chris Kenny: By working you mean not wrecking the joint.

Frank Sartor: Not wrecking the joint, in other words is it operating smoothly, new industries are
happening, it’s reducing... we’re reducing emissions, industry is starting to substitute, you know there are,
for example, solar panels that soon might reach grid parity and this will help give...

David Speers: And the polls aren’t as diabolical as they are right now.

Frank Sartor: All I’m saying is that if the system is working in terms of the mechanics in the Australian
economy shifting industry and those sorts of issues, then why on earth would you want to wreck that
certainty for purely ideological reasons.

David Speers: Chris Kenny you must acknowledge that trying to get rid of this thing is going to be messy,
messy, messy.

Chris Kenny: It could be messy. On that scenario you outlined it could be messy, but I don’t expect we’re
going to see that scenario. With due respect to Mark I don’t think the Government’s going to go full term. I
don’t think you’re going to be waiting around for another two years and then beyond that. It may have to
go to a double dissolution, but look I think the importance for now... this Government will be defeated
quite soundly sometime in the next two years and if they are it’s going to be largely on the carbon tax, it’ll
be like a referendum on the carbon tax.

This issue has dominated politics now for five years, as if Australia’s actions on climate change are going to
save the planet. Strangely enough we seem to be tying ourselves in knots over it. The point is if Labor loses
soundly on the carbon tax issue, it will be largely because they broke an election promise this time round
on the carbon tax. They’re hardly going to sit there in Opposition and block Tony Abbott’s mandate in the
Senate. They’re just not going to do that again. Now of course they’re going to say now that they will but
they won’t do it. It will be like Kim Beazley and the GST, they’ll just forget about it.

David Speers: Or the Liberal party and Work Choices.

Chris Kenny: Exactly, Liberal party and Work Choices. When you’ve been hammered as a political party for
your handling of an issue, you’re not going to sit up there in Opposition and asked to be hammered again.
Peter Dutton: It’s pretty sobering, David, I can tell you. Through bitter experience of having sat through a
shadow Cabinet since 2007, there is a level of pragmatism that strikes and believe me, if you’ve been
thrashed in an election, the last thing in Opposition you want to do is line up for another second thrashing
at the next election. I think we were right in doing that off ’07 in relation to Work Choices and these guys
would be absolute fools to block it in the Senate after the upcoming election.

Frank Sartor: It depends on the politics of the issue at the time and that could change dramatically.

David Speers: I’m keen on the issue you raised about how do we know whether it’s worked and at what
point we know it’s worked. Mark Dreyfus, is that going to be the test? How will we know...
Mark Dreyfus: That is why part of this package, and it is in the legislation that just passed through the
Parliament, is a Climate Change Authority, modelled on the British Climate Change Committee which
makes public recommendations to the Government on whether or not the scheme needs to be altered in
any way. It reports on reducing emissions. In our case it will be reporting on bringing down the present
rising trajectory of Australia’s emissions.

David Speers: So that will be the test, whether emissions are coming down?

Mark Dreyfus: Of course! Not whether they are in some kind of absolute terms lower next year, but
whether we are beginning, because that is what it is about...

David Speers: Lower than what they otherwise would have been...

Mark Dreyfus: Lower than business as usual.

Peter Dutton: You mean our domestic emissions?

Mark Dreyfus: That is why some countries actually measure their targets not in terms of a base year but as
against business as usual, and that is the objective. The moment we have got Australian emissions rising,
and we want to bring down those emissions, and eventually get to a position where we have got overall
declining emissions, which will not happen for some years yet.

David Speers: The point that Dutton’s about to make, I’m sure, is that it doesn’t mean that Australia’s
domestic emissions are necessarily lowering.

Mark Dreyfus: Well that is why you have international trading so that companies which bear the liability
for the carbon price have got the opportunity to seek the lowest cost.

Chris Kenny: So we’re buying Bulgarian carbon permits.

Mark Dreyfus: No, not “we”, the companies that have the liability. This is a fudge that the Liberals like to
engage in, pretending it is taxpayers’ money. It is not “we”...

Chris Kenny: Not “we”, but Australia buys some Bulgarian carbon credit, you’re confident about the checks
and balances in the system, no rorts...

Mark Dreyfus: That is why a great deal of work that has happened in the United Nations Framework
Convention on Climate Change is about measurement and reporting...

Peter Dutton: Is one of the tests that our domestic consumption drops off? Does there have to be an
abatement of...

Mark Dreyfus: It is Australia’s contribution to reducing emissions because the planet, and I would have
thought you would understand this by now, the planet is not making a distinction between the source of
emissions. It’s a global problem.

Peter Dutton: I understand that but we’re not responsible for emissions in Bulgaria or the United States or
India or China. We are responsible for our emissions here, and so I’m asking you is one of the tests as to
whether or not this has been a success, a drop‐off in our emissions in Australia?

Frank Sartor: No, it is a...

Mark Dreyfus: No, it is global emissions that we are concerned with. Australia, and this has been often
pointed out, is responsible for around 1.5% of global emissions and we need to make a start on our own
domestic emissions and we need to contribute in whatever way we can to a reduction in world emissions.
Other ways we are doing so is helping the Indonesians, for example, in reducing their rate of
deforestation. That is a great contribution.

David Speers: Let me ask you just a final question on this issue, what will be your test, Mr Peter Dutton,
whether the carbon tax, emissions trading scheme, has worked, or is there no chance that you will ever
contemplate giving the Government that sort of tick?

Peter Dutton: We have given the Australian public an absolute guarantee that we will abolish this
legislation. That is what we’ll do.

Frank Sartor: Even if it’s working.

Peter Dutton: It has no prospect of working because as Mark, in a convoluted way, explained that, in quite
a demeaning fashion, this is a debacle. It’s a debacle of a scheme, our competitors don’t have it, it’s the
only system in the world where it operates on an economy‐wide basis. There’s no prospect of it
succeeding. So I think we’re on pretty safe ground.

Mark Dreyfus: I am looking forward to seeing Peter Dutton explaining to the 12,000 pensioners in his
electorate that that the $510 that is coming to pensioner couples, and the $338 that is coming to single
pensioners, is being taken away from them.

Peter Dutton: All I’m saying is we’re not going to harm the pensioners therefore and we’re not going to
compensate them..

David Speers: We’re going to have to take a quick break, we’ll be back.

David Speers: Welcome back, we’re joined this week by Mark Dreyfus the Parliamentary Secretary for
Climate Change, Chris Kenny, Sky News contributor and the host of Saturday Agenda, Frank Sartor is a
former New South Wales Labor Minister and author of The Fog on the Hill, and Peter Dutton, is the
Shadow Health Minister.

Now, I guess it’s been raised a couple of times over the last hour but the leadership issue on the Labor
side. Frank Sartor, you write in your book about the chopping and changing of leadership at the New South
Wales level. What is the experience there, what has Labor learnt from that or what should it learn from

Frank Sartor: I think that the fundamental issue for governments is to focus on the principle of good
government, which is chapter two in my book. But really it’s about focussing on policies and consistency
and winning back and being authentic. And I think the people of Australia desperately want authenticity at
the moment because there’s a lot of uncertainty around in all sorts of areas. So I think the critical issue for
the federal government is to pursue consistent and solid policies and get them resolved.

David Speers: And are we seeing that?

Frank Sartor: Well I think we are starting to certainly see an improvement in that area. I think some of the
missteps before the election did them a lot of harm. I think you’ve got to be really careful. I don’t think, I
think they should drop this ‘announcables’ nonsense and think things through before they are announced.
And I think certainly in the last six months I’ve seen a lot less rash, in fact I probably haven’t seen any rash

David Speers: And what about the leadership? The change...

Frank Sartor: Well look, I am too removed to be able to make serious comment on that although
commentators know less about it than I do will makes lots of comments about it.
But firstly let me say, the personal attacks on Gillard are appalling. And even the other day, the sort of
language is just appalling. Whether you agree with her or whether you don’t, I just think it’s disgraceful.
And if they made those attacks on Howard they shouldn’t either. The simple fact is that we should be a
civilised democratic country I wonder whether the leadership change is the big issue that people think it
will be. I think we need to win back more credibility, authenticity and engage with the community. And I’ve
got a lot of other observations about the party and how it should reform itself. But to me, solidness, being a frame of reference for the community and providing them with hope is a lot more important, probably,
than changing the leader.

David Speers: Mark Dreyfus, how safe is Julia Gillard?

Mark Dreyfus: Very safe. I say that with absolute confidence and I agree with Frank. There has been far
too much concentration on this leadership story. Journalists love to write it. We saw it for years with
Howard and Costello. We saw it right through the first bit of opposition where there was constant
speculation about when Malcolm, your boss, was going to make his run then whether there was going to
be a run made against him.

Chris Kenny: Journalists just make this stuff up...

Mark Dreyfus: No I do not mean to say that, I am just saying...

David Speers: In defence of the media you’ve given a bit of fuel to the fire by changing leaders, how many
times in New South Wales?

Frank Sartor: Well we learnt from the Liberal Party, they had eight leaders while Level Neville was leader
of the Labor Party the Liberal Party had eight leaders, we learnt it from them. But unfortunately we did it
when we were in government, they only changed a couple when they were in government.

David Speers: And so did these guys.

Mark Dreyfus: I think you would have to accept it is an easy story to write, and I am confident...
David Speers: The problem is, we have MPs, such as yourself, saying this and then five minutes later Kevin
Rudd gets knocked off by Julia Gillard. And every one points to the media and says, why didn’t you see that

Mark Dreyfus: Well, I see that other people are out there, fuelling this imagined fire and I can only tell you
what it feels like to me, as Cabinet Secretary in the Gillard Government, that Julia Gillard is doing a fine job
as Prime Minister. She is providing orderly and good government, and I think it is about good government,
and we are going to go on governing and building on the achievements of the term that we have had so

David Speers: While ever your primary vote is in the twenties, you must acknowledge that some of your
colleagues, perhaps not you but some of your colleagues, are going to scratch their heads and at least
wonder whether a change in leadership might save their own skin.

Mark Dreyfus: Well, government is not one long opinion poll as some people seem to think. It is about,
and I am very much agreeing with Frank, it is about solid good government. And for us it is about building
on achievements like there being 750,000 jobs that have been created since Labor has been in
government. There are 140, 000 people more in work than there were twelve months ago. That our
national debt levels are a fraction of the debt levels we have been reading about in Europe. All of those
things are the things that matter to me. They are the important things. And it is about looking at the solid
achievements of increased pension rises of in fact getting this carbon price in place those are the things
that are going to matter in the long term.

David Speers: Peter Dutton, you guys had a hell of a ride on the leadership front in the last term you
through from John Howard, to Brendan Nelson, to Malcolm Turnbull to Tony Abbott eventually, given that
experience, do you really think it would be a smart move for Labor to change again?

Peter Dutton: Well I think it’s a big difference being in opposition and changing leaders than to depose a
sitting Prime Minister. I think that’s what really annoyed the Australian public, they were sick of Kevin
Rudd and the move against him wasn’t because the people were happy with him the public had, you
know, lost confidence in him and so they dumped him in government and I think there’s a big difference
between changing leaders in opposition and in government.

Now Mark’s read from the Government script which is fair enough you’d expect him to do that, and he’ll
back his leader which is fine but as he’s doing that his colleagues in caucus are texting and phoning
journalists saying, you know, it’s game on or Rudd’s out there doing photo opportunities on Julia Gillard’s
birthday to try and infect the story and the programs on the news that night. He’s giving the kiss of death
to Julia at the end of the carbon tax debate which completely overshadows what the Prime Minister saw
as a crowning moment so he’s playing games so it is game on. She’s been a terrible disappointment, as
Frank says the Prime Minister should be treated with the utmost respect but I do think the office, I do
think the office has been demeaned I do think this has been a bad government and I think the Australian
public believes the same.

David Speers: Chris Kenny, what do you see happening here?

Chris Kenny: Well, I just think that Julia Gillard is finished. You know, it’s sad for those who expected
greater things from her, Australia’s first female Prime Minister, and all of that. But I do agree with Mark
and Frank in that the problem isn’t just leadership, the problem for the Labor party of course is substance
and authenticity. But the trouble is that that hasn’t been delivered by Julia Gillard. The public don’t know
what she stands for in the key policy areas, she’s flip flopped on the carbon tax and climate change, she’s
identified border protection as one of the three key policy areas she had to fix up, and it’s now an absolute
shambles with she’s basically today just declared open borders we’re back to on shore processing.

David Speers: Isn’t this the problem that any change isn’t going to fix those problems.

Chris Kenny: No I wasn’t... I was being a bit flippant about the carbon tax, but not entirely, and a Kevin
Rudd return. And that is right, it’s not going to be good enough just to change leaders like the New South
Wales Labor Party...

Frank Sartor: That didn’t work for us.

Chris Kenny: And that’s why Kevin Rudd is actually an alternative for the Labor party because it’s a
plausible story to tell voters that is, we’re sorry we knifed the Prime Minister you elected. We shouldn’t
have been so presumptuous we... he has learnt from his time on the sin bin of Foreign Affairs. He’s coming
back and we are going to reconnect with voters around our core values. And one of the keys he could do if
he comes back in time is say, saying to voters that he’ll give them a chance to actually cast a vote on the
carbon tax, ETS whatever we want to call it.

David Speers: Frank Sartor, you’ve seen this whole leadership, and Mark’s absolutely right, the stories that
are constantly written, the speculation does them no good at all. You’ve seen this happen at the state
level, is there anything that can be done by the Party, by the two players here, Julia Gillard and Kevin Rudd
to put this to bed. I mean, they’ve kissed and hugged this week and still the front pages scream leadership

Frank Sartor: I think it’s the sort of thing you’ve just got to see through. You’ve just got to hold the line and
see it through and over time it’ll disappear. Because you guys were bitten because you didn’t see it coming
last time and you’ll speculate every day of the week that there’s going to be a leadership change just in
case one happens. I think they’ve just go to keep their cool and see it through, focus, get some wins on the
board some of the issues that Tony Abbott has exaggerated in terms of problems will disappear. So you
need some clear air and see how it goes. I mean the prospects are still very difficult for the Labor Party at
the next Federal election because the brand nationally at the moment we’re just going through one of
those cycles and it’s very difficult and if they can keep Mark Arbib in his cupboard and focus on good policy
they’ll recover to some extent.

Chris Kenny: Do you really see them staying with Julia Gillard though with a primary vote below 30% I
mean it’s been there for months now.

Frank Sartor: The problem is Chris that in New South Wales they dumped Iemma when he hit 33% and we
dropped to 29, 26%, and Richo used slightly different stats here but I don’t think he’s right really and I
disagree on that, and then he then climbed up to 31% and then we went to Keneally and she fell down to

Chris Kenny: She’s got some political tin here though, she had her win yesterday and has completely
obliterated that win yesterday by mishandling the politics of border protection.

David Speers: Well it has been a remarkable week but we are out of time for this week’s show. I’d like to
thank Mark Dreyfus, Chris Kenny, Frank Sartor and Peter Dutton. Good to have you all here this week.