KIERAN GILBERT: Welcome back to the program. The Industry Minister Ed Husic has said that manufacturers are getting a raw deal from gas producers. He joins me live now from Sydney. Ed Husic, thanks for your time. Before we get to the energy question, I want to ask you about this other announcement you made today then we’ll move on to that if we can. This Google initiative on micro credentialing – what’s that all about? Can you give our viewers a sense of that? 

ED HUSIC, MINISTER FOR INDUSTRY AND SCIENCE: G’day, Kieran. Well, as people would know, technology’s a big part of literally all businesses in the country. You need to be able to have people that can manage technology to ensure that your business can keep the doors open and can grow. We know that a lot of businesses had to get up to speed real quick with technology. As someone once described it during the pandemic, you had businesses go from being the Flintstones to the Jetsons in a few short months because they had to learn how to deal with technology. But having the skills and talent there, is really important. 

So, what Google has announced today is that they're partnering up with another major online training provider and they’ll provide scholarships to people, particularly from underrepresented people in the tech sector to train them up – young people, people thinking of a career change – to get them those skills that are in really high demand and to put them to work quickly. 

We’ve got a big target in this country. We want to get 1.2 million Australians in tech-related jobs by 2030, and this initiative by Google is a great step in making sure that they’ve got that training in place for Australians for the jobs, the skills that that are needed by Australian business. 

KIERAN GILBERT: A big thing from Labor in the election campaign was about manufacturing. Central to that is affordable energy, isn’t it? And you in the last few days have said that gas producers basically have a choice: they can be part of Team Australia, or they can be part of Team Greed. Has the Heads of Agreement announced by the Government let the gas producers off the hook? 

ED HUSIC: The important thing about the Heads of Agreement is that that it filled the need for more supply, which was critical. Prices will go crazy if we don’t get that supply, and the concern from the ACCC is that we’d be facing a massive shortfall, and the Heads of Agreement brought in 157 petajoules of additional supply, so that’s important and also a commitment to set up that bar, that cap, that ensures that we will not pay more than export prices. 

But, really, that is an upper level protection. The main aim in – or the main aim of the game right now is to drive prices down. 

We were elected on a platform to revitalise manufacturing. There’s an imperative for us to deal with supply chain shortages, to learn the lessons of the pandemic and to not be dependent on just a couple of countries for a lot of our inputs. We can do this here. We can meet our needs. 

We can create jobs, but lower input costs are crucial, and the gas companies are being told this regularly by myself and others and they don’t seem to have picked up the lesson. They’re not learning. They’re not listening and they’re not delivering. 

KIERAN GILBERT: So, they’re not listening. How can you force them to charge Australians less for an Australian resource? 

ED HUSIC: Well, the biggest thing that the gas companies can do right now is recognise that their business model would make a locust swarm proud. 

Now, at the moment, all they’re doing is sucking up an Australian resource and selling it at phenomenal prices overseas and doing so in such a way that is putting pressure on manufacturers and households in this country. 

That cannot continue. 

Most Australians would agree that access to an Australian resource, [at a] fair price - really important. And so from our point of view, there are a number of areas where we’re looking at potential reforms; for instance, the Code of Conduct that governs the way in which supply contracts get bargained and it is going to be important that we look at price and that we look at it in a way that we understand that the gas companies have to cover the cost of production, make a reasonable rate of return. 

But I have to say, if you asked them at the moment what a reasonable rate of return is, what they’re expecting as a reasonable rate of return versus what we’re copping as gas prices are two different things. And that’s why I said: they need to understand. 

We’re committed to revitalising manufacturing, lowering gas prices - they can either do the right thing by the country or they can continue to be greedy. It’s Team Australia or Team greed. The choice is up to the gas companies, and I know what choice they should be making. 

KIERAN GILBERT: The Australian Workers Union national secretary, Daniel Walton, has a similar message to you, but says that the Heads of Agreement is a dud deal for manufacturers; it does nothing to drive down prices. What’s your message to him and others concerned by manufacturing? 

ED HUSIC: The Heads of Agreement, what it did, was ensure that the supply was there so the prices didn’t get worse. But we’ve still got a lot to go, and we recognise that we do need to make those reforms to ensure that we see the lower prices. The way that the price trigger was shaped by the Coalition Government, that is just not proving useful at all and we will need to make changes to deliver better prices. So I can understand why Dan Walton on behalf of his members and I can certainly appreciate why manufacturers expect more and we do need to deliver and the gas companies need to hear that message too. 

KIERAN GILBERT: Well, the Government – and I started with this in the introduction – but really the Government’s manufacturing agenda, not just your agenda but the future of that sector, is it too much to say it’s at stake in these discussions? 

ED HUSIC: I look at it as lead in our saddle bags. These high prices in terms of these impacts on manufacturers is real lead in the saddle bags if we don’t get the skills piece fixed - and we’ve started work on that in terms of what you saw with the Jobs and Skills Summit and some of the announcements coming out of that – and supply chains and addressing some of that, and that’s slowly repairing. 

But the big thing is to ensure that those input costs get lowered so that we can revitalise manufacturing. 

You’ve seen the benefit of that in the United States, for example, where they’ve been able to onshore manufacturing for the first time in decades as energy prices came down. 

And it’s not because we don’t have supply. I mean, just so I can emphasise this point. 

If you look at the gas that’s required as part of energy generation, it’s a shade under 400 petajoules. If you look at what’s required by manufacturers, it’s a shade over 400 petajoules, and what’s needed for households is 166 petajoules. 

Do you know how much we export out of this country – 4,300 petajoules. We have the supply. We need to make sure that the uncontracted amounts flow through at a fair price [to the domestic market]. 

KIERAN GILBERT: Yep. And so, just on the mechanics of this. It’s all pretty technical. We had the Heads of Agreement. There is a Code of Conduct. Can you have this demand included within the Code of Conduct to ensure that the gas companies step up? 

ED HUSIC: We’ll be examining what we can do to ensure that price is factored in, that there is a mechanism there. We want the gas producers and the consumers, in this case, manufacturers, who make up half of the demand of the domestic gas market, major users, we want to be able to see that they can negotiate better contract rates longer term, to ensure, too, that our contracts, that the price for gas in contracts long term is not higher than what our competitors are getting, which is happening right now. 

We need to see that addressed. So, having the producers and the buyers be able to negotiate a good outcome - really important; but if that breaks down, we need to see what mechanisms can be put in place to deliver a better outcome. 

KIERAN GILBERT: And, so, with your message, it’s a pretty clear message, that if they’re putting a swarm of locusts to shame, they’ve got to lift their game. 

ED HUSIC: Yeah. 

KIERAN GILBERT: And I guess this was made even more pertinent and urgent off the back of the warnings from Alinta Energy that we could be copping 35 per cent increases in our power bills next year? 

ED HUSIC: We need to drive prices down, and the gas producers need to recognise that what they’re doing at the moment, this absolutely rabid pursuit of profit above all else and the pressure that it’s putting on industry, that this is a serious threat, that the Government takes this seriously, and that we will look at all options before us to be able to sidestep that threat and not have that pressure on business and households. 

We cannot be more clear: if these gas companies think that this is the end of the story and the heads of agreement is all done and dusted, they’ve got another thing coming, I can tell you that. 

KIERAN GILBERT: Well, you couldn’t have been more frank, and if they don’t listen now, they probably never will. Ed Husic, Industry Minister, thanks for your time. Talk to you soon. 

ED HUSIC: Good on you.

ENDS