MEL: The PM joins us in the studio, good morning.
PM: Good to be here. Good to be back.
MEL: You've got public servants who are paid to advise you. And you're kind of concerned, albeit, they're saying that it won't work, that we'll be paying more. Why are you going against their advice?
PM: Well, there is an organisation called the ACCC which is Australia's competition watchdog. It's also there, paid for by the Government, to provide advice. It's the only Government agency which has done the economic modelling on that. And, they gave us a 300 page report with econometric modelling in it, which said that in Perth, after a seven year examination, it lead to an up to two cent a litre reduction.
And secondly, what the econometric modelling concluded through the advice also given to us by the head of the ACCC is that this arrangement applied nationally will not produce any upward pressure on fuel prices.
There are a whole lot of other factors out there affecting the global fuel price - we know about those. But, your question is, what advice do we take? We took the advice of the competition watchdog, a report commissioned by Peter Costello back in the middle of 2007. He said at the time that it was the most responsible agency to advise on price questions. They are the only ones who did the econometric modelling. They came out with a conclusion. And frankly, what would happen in this debate today if all that evidence then went out into the public domain, we'd be attacked for not proceeding with FuelWatch.
So, that's why we did it. But, in Government, obviously, different departments have different views. But this is the only one that actually did the hard number crunching on it.
KOCHIE: A lot of the independents are saying, ‘hey, if we've got to signal our price the day before, it takes away a lot of the flexibility for us to whip in a price drop during the day, we're sort of locked in for that 24 hours'?
PM: Yeah, but we take the side of consumers. If you're a consumer and you're looking for the best price possible, what they say to us in Perth is, what they want to be able to do, is go to the FuelWatch website, find out from FuelWatch, often through free publicity in the newspapers, where the best prices are that day and know that it's going to be that way that day. So that you have the information and on a given day, you know that right across the metro area there can be up to a 15 or 20 cent variation per litre at different petrol stations.
Now, if you're a consumer, my question is this: why shouldn't the consumers of Australia have access to that information, know that it's going to be that way for the 24 hours ahead? Because at present, all that information is only had by the major oil companies. So, in this debate, and this has been my challenge to Dr Nelson all week, either you side with consumer power and the choice of motorists, and this will always only help at the margins, it's only a few cents a litre we're talking about, or you take the side of the big oil companies. And I say this, why is it that all the big oil companies, virtually, are lining up in opposition to our proposal? I mean, I think that says something of itself.
MEL: With the flexibility, and obviously that's what you want, you want to have prices locked in from breakfast till dinner sort of thing, the 24 hour period, Mark in Victoria has got an idea. ‘What about, an easy solution, allowing the states to actually reduce prices at any time, not increase them?' So, they'll lock it in, but if they want to make it cheaper during the day they can actually drop it, but they can't increase it?
PM: The problem with that is what they call, ‘gaming the system'. That is, on the day before you could say that you're going to have a price much higher than you would otherwise be the case, this is if you're a retailer. And then, game it, by bringing it down the next day so that you actually artificially pump the price up through that arrangement. All the experts in WA, and the ACCC people, have actually gone through all these arguments. Because these are the questions that we put in our Cabinet discussion on this.
So, look, this is not a simple solution, and it's not a single solution, because, as you know, Kochie, the price of petrol is a problem right across the world. The global oil price is up 400 per cent since the Iraq War. Every Government leader I have spoken to in the last several weeks says, ‘what's happening with your petrol price debate in Australia' because it is going off all around the world.
KOCHIE: Do you think you've been a bit conned to actually put all your eggs in this one in this one basket, rather than through a whole series of measures? Like, the price of diesel is way above what it is in the rest of the world. Now, that's more efficient than unleaded petrol. Things like dropping charges on hybrid cars, for example. Or, increasing the rebate on converting your LPG to gas in cars. You know, should that be part of the mix as well? Have you concentrated too much on one thing?
PM: Well, this is the point. Not only is the problem of petrol a global problem, every Government is going through it, but you also need what I'd describe as an integrated long term solution, which is what you're talking about. And the sound and lights show which was parliament yesterday, and the last several days, which has been a free and fierce debate, as it should be - what I've said repeatedly is, ‘let's look at all this'. Supply side factors around the world, what can you do on that front in terms of additional prospectively in certain countries around the world, including our own, offshore. Demand side factors - efficiency. Because, there is no real attempt at systematic efficiency in those huge countries pushing up the global price.
But, you talk about fuel efficient cars, that's why we have a half billion dollar fund to make sure that we can try and get the car industry here to build an Australian hybrid. And then, alternative fuel strategies. And, why not use the huge funds we've got from the resources boom to invest in major public transport projects like - cities like Sydney where we are today, or in Melbourne - why is it in the 21st century we don't have an urban-metro system? Why is it? Big cities around the world do. People are in their cars, burning fuel, costing their Budgets a lot money -
KOCHIE: So you'll look at diesel, gas conversation, all that sort of stuff?
PM: ... So what the Government is doing internally, is a long term plan to address each of these points. This is just one small part of the overall debate -
MEL: Diesel in particular, we get a lot of questions about -
PM: You're right on that. And that's why, for example, the petrol price commissioner now has, and this is a small measure as well, but informal price monitoring powers under our arrangements through the ACCC. So, we're aware of all these, working out way through.
MEL: Quick question on the leaks and all the information that has been coming out. You said you're pretty confident it wasn't a Cabinet colleague. Have you gone around and asked each of the Ministers? And if you find out who it was, whether it's come from the public service or elsewhere, what will you do?
PM: Look the process you go through here is that I'm absolutely confident of how the team works. I mean, I know them all, we've debated this matter and overall, cost of living pressures and how to deal with petrol, intensively as a Cabinet. And you know the folk that you're working with. And you know how you got to a particular decision. And in doing that, there's always disagreements internally. But that's normal. That's how the board of Channel Seven would work, I'd imagine. And that's just normal.
KOCH: And marriages!
PM: Speak for yourself. I just do what I'm told. But, what I've done, is the Secretary of the Prime Minister and Cabinet Department, he's simply responsible for the overall integrity of the Cabinet document process. And so what he's doing is conducting his own normal investigation according to the normal processes that are in the public service.
KOCHIE: Alright. Speaking of marriages, a lot of newspaper editorials are saying that the honeymoon is over, the training wheels are off. The Financial Review says you've had six months in power, so the time for excuses is finished. Dennis Shanahan, in The Australian, reckons you're losing your first blush. It's very romantic. Is the honeymoon over?
PM: Oh, look, people will make their judgments about us over time. I mean, I've been leader of the Labor Party now since the end of 2006. And, look, the business of being a national political leader is there are some weeks that go well, there are some that go badly. People make a judgment about you over time.
One of the criticisms we've got is that, which I find remarkable, is that we're working too hard. This is the debate within the public service. You know, if you're elected to form a Government, and you've got a big program of change, trying to make a difference on the big things like urban transport long term, big things like how do you fix the school system, the university system. Big things like health and hospitals. Well, frankly, I do believe in burning the midnight oil. And, we'll continue to do that. Make no apology for it. But how we are treated by the public and the media, look, that's just a judgment for others to make. I've just got to get on and do a good job which I've been elected to do.
KOCHIE: Yep. Okay.
MEL: Busy weekend?
PM: I wish I knew what I was doing. I'm here in Sydney, it's Friday. I'm heading to Brisbane from here. And, in fact, we've got some good things to do in Brisbane later today, at the Mater Hospital.
KOCHIE: Because you still get out on the street, don't you? In your local electorate. You take your, sort of, card table out onto the sidewalk and just chat with people?
PM: Well, in my electorate now, I've been the member now for nine going on ten years. So, I counted it up, I've done 206 mobile offices. But, since I've become Prime Minister, I think I've done two or three. And let me tell you, the queue is now longer. We've now got to solve world peace, we've now got to solve -
KOCHIE: The whole lot.
PM: Yeah, the whole lot.
KOCHIE: Thanks for joining us. Good to see you.
PM: Thanks for having us on the program.