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August 14, 2020

TOM CONNELL: Joining me live is Brendan O’Connor, Shadow Employment and Industry Minister. Thanks very much for your time. Look, the numbers are bleak. An additional half a million people out of work since the beginning of COVID-19. But, I mean, this is a once in a century pandemic. It was always going to be pretty bad the figure. How do you assess this one?

BRENDAN O'CONNOR, SHADOW MINISTER FOR EMPLOYMENT, & INDUSTRY, SMALL BUSINESS, & SCIENCE: Well, I guess it is a bad figure, as you say Tom. It is difficult times for everybody. The best thing we can do as a nation is put in place support for businesses and for workers and for our economy generally. I think while the government's got some things right federally, they haven’t really attended to some other matters. I noticed today the Business Council of Australia coming out asking for the government to provide industry support. That’s not been forthcoming. And we’ve got 2.5 million Australians underutilised in the labour market with more to come. Remember these figures are based around the time when Victoria was not in complete lockdown. So look, there’s still 400,000 jobs forecast to go so it’s very difficult.

CONNELL: There’s a pretty bleak warning from the Treasury head. Now this is, you’d assume, an apolitical warning - it’s one based on modelling without talking about good or bad policies - that we will have higher unemployment for 4 to 5 years that it will not come down below six per cent in that time. So what is a pass mark for the government at the next election?

O'CONNOR: Well, I think whilst they were belated supporters of wage subsidies, they did the right thing in putting in JobKeeper, it is too narrow and it was a bit slow. I think though JobKeeper alone is not going to ensure that our economy recovers sufficiently and therefore it’s not surprising that the business community and others and eminent economists have really said the government needs to be looking at other options.

It’s not enough just to rely upon a descending level of support in the form of a wage subsidy until March and then we’re off a cliff. So I guess everyone is expecting the government to outline a jobs plan in October. I would prefer that they brought that forward and started to instill confidence in businesses and the community generally that they have a plan beyond just wage subsidies for a limited number of sectors of our economy and I think they can do that.

I think that you can learn the lessons of the past. You should be looking overseas as well. They should be working with - I think there’s great opportunities in some sectors of our economy to grow those sectors because we know some sectors will be contracting whatever we do with respect to this pandemic.

CONNELL: Which leads us to what the Business Council of Australia is today saying to the government or urging the government, pick winners don’t sit on the fence. Do you agree? And how do you pick winners?

O'CONNOR: I think Jennifer Westacott was saying we need to engage with industry. I think the problem at the moment is there’s a sense in the business community that beyond sort of the macro response by the government there’s very little engagement in sectors of our economy. We don’t see the deployment of regional policy, where you’d be looking at how to help local economies. You don’t see, for example, a proper package for tourism. You don’t see significant packages in manufacturing. In fact they are cutting, according to the legislation being proposed, they’re looking to cut $2 billion out of research and development this financial year, which will hurt manufacturing. So despite their rhetoric in support of manufacturing their actual support is not present.

So I think it’s fair to say that there is no easy way to go about this but you start by engaging with sectors of the economy, the ones that you can see a more likely to grow post pandemic. There are some of course that are not going to return to the size they were for many, many years, which is tragic, but that is the truth of it.

CONNELL: One of the winners been picked to help out a lot of sectors by the government is the gas industry, for gas to play a greater part in our energy use in Australia through infrastructure underwriting and subsidies. Is this something Labor is on board with?

O'CONNOR: Well Labor believes that we should be using a broad range of energy sources to help our economy and that includes gas, it includes supporting obviously increased support for renewables. That’s what the evidence shows, we need to increase the use of renewable energy over the longer term. So it is a mix of energy sources and I’m certainly one who supports gas as being used for example to help manufacturing.

As for whether Labor is on board with the plans that have come out of that working group well quite frankly that's a leaked report. We would like to see what the government's formal response is to that and we would like to examine that. But obviously I don’t think you should be going in just subsidising one sector over the other. You should be looking at the evidence and having a mix of energy sources.

Australia is very well placed Tom, as you know, because we have such great potential in renewables and we have of course traditional sources of energy as well-

CONNELL: Just to jump in, you’d be concerned if they were plucking out gas infrastructure for subsidies above for example helping out renewables? I mean you can argue there are renewable projects including Snowy 2.0. But that's your wariness about this, whether it elevates gas too much?

O'CONNOR: I think we shouldn’t be so interventionist as to sideline what are potentially more reliable over the longer term forms of energy that will be both reliable and cheaper. You have to be very mindful of the fact. Now I’m of the view that you need to use a mix of energy. That’s the view of the Labor leader. And of course we can see that there is a growing likelihood that we will rely upon renewables over the years ahead. But the idea that you abandon other energy sources is is wrong, just as it’s wrong to subsidise one industry over another.

CONNELL: There’s seemingly no real chance of international borders being open any time soon. How important is it for our internal borders to be opened up where sensible to help economic growth and jobs as well?

O'CONNOR: Well, I think there’s a really tough tension. You start with dealing with the health challenge. Obviously we need to work out more effective ways, logistical ways of getting freight and getting the ability to move our goods across borders first. If there are any obstacles to that we need to remove those obstacles where we can in a safe way. Quite frankly I think those states doing well are very happy that they had not had their borders opened. I know that the Prime Minister was hoping to see the borders opened quickly. I think in hindsight that was wrong and I think the Premiers generally made the right decision to keep locked down the people movement between states. I’m a Victorian, I want to see Victoria recover, but I do fully understand why you couldn’t have Victorians travelling the country.

CONNELL: Of course, that’s the easy case at the moment. I don’t think anyone’s disagrees with that. But let’s take WA, shut to South Australia, to the Northern Territory, to Tasmania, to the ACT. WA has one case most of these jurisdictions have either zero or one or two. Is the outlook right now - let’s forget about the push before from from the Prime Minister - do they really need to start thinking about very soon opening up the borders to those states? You could do it in a controlled manner through air, for example. Get things going again.

O'CONNOR: Of course you want to see that happen. I think New Zealand is a sort of cautionary tale about thinking that you can actually manage to eliminate this particular pernicious pandemic and it’s much harder than I think people fully understand. So I understand the caution. I think what we should be doing though is wherever we can at least open up the arrangements so that business can flourish, then we should be doing that. I think just the idea that we would be opening up the borders just for people movement even between WA and South Australia unless it is necessary is not something that I imagine that they would want to do quickly. And also, for example, the Queensland Premier was attacked mercilessly, you know this Tom, attacked - including there was some criticism by the Prime Minister of the Queensland Premier for not opening up the border between New South Wales and Queensland. Well she made the right decision there in hindsight.

CONNELL: I understand those elements of it. I understand that and fair enough you’ve made that point, but in the present when we are looking at the approach from WA to South Australia, so few cases in both states. Surely we’re getting to the point where, I'm talking about business as well, Brendan O'Connor, but it’s families not being able to see each other as well. How much longer can they keep the hard borders up with almost no COVID-19? Because if they keep them up now we’re not talking about suppression it’s eradication, which supposedly is not the National Cabinet approach.

O'CONNOR: I think each jurisdiction has had some - I mean obviously the federal government has chosen to almost outsource the quarantining and other arrangements including borders. I think that even the Prime Minister conceded that whilst there was a general approach each jurisdiction may decide to do some variation on that general approach. I think, look, I’m sure the Premiers would be examining the arrangements on a day-to-day basis and they are rather nervous. As you see, for example, in Tasmania there were no cases for 120 days and then of course we saw a couple of cases.

I think that in the end you are going to err on the side of caution when it comes to this pandemic. It is remarkably contagious and for that reason they have to be mindful of that. But obviously we’d all like to see Australia being able to be free of this pandemic and us to have our lives back, but that’s going to take some time, Tom, as you know. I’m at the moment I’m self isolating at a house, never mind a border, I can’t go outside.

CONNELL: I understand that.

O'CONNOR: So that’s just a good reminder that you don’t want to go down that track if you can avoid it.

CONNELL: I understand it’s a balancing act. As I said perhaps some more pressure on some of those effectively Covid free states in the future. We might talk about that again in a few weeks. Brendan O’Connor, thanks for your time today.

O'CONNOR: Thanks Tom.