UHLMANN: Julia Gillard, welcome to 7.30.
PM: Thank you very much Chris.
UHLMANN: When you met with President Obama did you press him on when the US will put a price on carbon?
PM: We did talk about climate change, obviously I am committed to pricing carbon in Australia, it's the right thing to do for our economy to make sure we have a clean energy economy for the future.
President Obama is taking a different course here in the United States, that's a recognition of the political circumstances he finds himself in with the Congress and so he too is looking for a clean energy future, but will pursue it differently because he couldn't secure a price on carbon through the Congress.
UHLMANN: But if the United States doesn't put a price on carbon why should Australia?
PM: Well we have to look after our own national interest and our own national circumstances. The reality is we are bigger emitters of carbon pollution per head of population than the United States of America. That means the transformation we need in our economy is more, the most efficient way of driving that transformation is by pricing carbon.
UHLMANN: But to speak of one economist of our own and Ross Garnaut said in his first report that ultimately global mitigation will only be successful if countries can trade in emissions permits and if the United States never gets there that will never happen, will it?
PM: I think you are making some assumptions about the future of the world and other countries in our world which aren't warranted. Already 32 countries have emissions trading schemes, 10 American states do as well, they haven't waited for action at the national level, they are acting themselves and when we talk about American states we can be talking about very sizable economies.
UHLMANN: But Prime Minister, those states you're talking about, in fact there's a retreat by states in the United States, states like New Hampshire and New Mexico are pulling out of those systems that you're talking about, so in fact rather than there being an advance in the United States, there is a retreat in the United States and John Boehnor who you met today, the head of the Republicans in the US House of Representatives, he actually wants to cut the budget of the EPA by $3 billion so it can't regulate carbon prices.
So I ask again, without the United States being in on this, why should Australia put a price on carbon?
PM: Well Chris, what I would say to you is Australia and America are great mates, but we're not the same country. The US will make its decisions here and they'll make their decisions through their political system.
It's well known of course that President Obama wanted a cap and trade emissions trading scheme, a scheme like the one that I am saying we need in Australia, but he faced political circumstances in the Congress after the mid-term elections that made that impossible. Well, that is the democratic decision making -
UHLMANN: That because it's impossible they've agreed it will never happen and that means that your carbon price will remain a carbon tax forever, won't it? Without an international agreement there won't be an international market, which means the carbon price that you impose will remain a carbon tax?
PM: Can I just finish what I was saying? America, its own country, its own democratic institutions, and they are the political circumstances in America now. What should we do? We should make a decision in our own national interest and I've made it. I am saying to the Australian people, when you look at the world, countries are moving for change. We've got a big journey of transformation, we need to start on that journey now, we cannot afford to wake up down the track with a high carbon pollution economy when the rest of the world has moved and then try in some huge rush to transform our economy with all of the high prices and disruption that that would imply.
UHLMANN: Is it true that there will be no solution to climate change without international action and that means that we need an international market?
PM: What that means is nations around the world will move to address climate change. They will move to clean energy economies; we need to move to a clean energy economy. What should we do? We should select the most efficient way of doing that transformation - and that's pricing carbon.
And what are the alternatives to this? Well Tony Abbott has written for one of today's newspapers that there's no way of fixing carbon pollution without significant price increases or significantly changing people's lives. What he's admitted today is his direct action plan is a con, it's a con job. It's not going to do anything. It's just a piece of political theatre; he's actually admitted that in today's newspapers effectively.
UHLMANN: Prime Minister when you began this debate -
PM: Compared with that I'm telling people like it is, and like it is is we have a carbon pollution intense economy, we need to transform it and the most efficient way of doing that is pricing carbon.
UHLMANN: Alright Prime Minister, when you began this debate four years ago you had public sentiment behind you, how is it that a Newspoll today has you at 30 percent, that's the lowest primary vote in that poll's history. How is it that you lost that community sentiment somewhere along the way?
PM: Well I'm not going to comment on polls, they'll go up, they'll go down, but what I would say is this: I've always expected that the debate about putting a price on carbon would be a hard debate, this is a major economic reform and economic reform is tough. When we made the big reforms of the past, like reducing tariffs, that wasn't popular, but it was the right thing to do. Putting a price on carbon is the right thing to do, it's in our nation's interest and I understand Tony Abbott is the master of scare campaigns and he'll say anything and he'll do anything to frighten people and wreck things. If that's the political debate we're going to have, well that's the political debate I am determined to win, to price carbon in the interests of our nation.
UHLMANN: One more quick point on this, will you run a government funded advertising campaign to try and turn community sentiment around?
PM: Look, on government advertising, from time to time we advertise to get necessary information to people, so I'm not going to rule in or rule out government advertising in the future.
UHLMANN: But it's possible?
PM: But I will be there saying to the Australian community, as I am saying to you now Chris, this is what we need to do for the future of our economy. We're a confident, creative people. We've engaged in tough economic reforms in the past, even when they weren't popular and we've had a prosperous country as a result. We're up to this as a people, we'll get it done.
UHLMANN: Prime Minister, thank you.
PM: Thank you.