Doorstop - Adelaide

E&OE TRANSCRIPT

Doorstop - Adelaide
19 February 2016

SUBJECTS: Australian Government inquiry into Asian dumped steel; Australian shipbuilding projects; the federal election.

Christopher Pyne: Well thank you for coming along today. I thought it would be useful to talk a bit more about what the Federal Government is trying to do about the steel industry in Whyalla, and obviously in Port Kembla. Yesterday we announced an inquiry into Asian steel and its potential for being dumped in Australia. I can report that Arrium and BlueScope and OneSteel and other aluminium producers immediately contacted either the ADC or my office to put in put into that inquiry, and there will be, in the course of the next two or three weeks, some decisions being made by the Anti-Dumping Commission, which will then come to me around duties on allegedly dumped Chinese steel. So we are making progress.

I note that the Leader of the Opposition has made some comments today about using Australian steel. Unfortunately Bill Shorten yet again hasn’t done his homework. His own Government, when he was in power, introduced rules around the use of Australian standard steel on Federal Government projects; any project over $20 million was required to allow Australian business to have the same access as any other business. He introduced that when Julia Gillard was the Prime Minister, well he was part of that Government, and we haven’t changed those rules. Those rules remain in place.

Of course, the facts are that the Commonwealth Government doesn’t do a lot of construction. Construction, road building, new buildings, things like the Adelaide Oval for example, are done by the state and territory governments; they have the equipment that makes those things happen. So really, their policies are the ones that matter. So I am pleased that the State Government in South Australia has changed their approach so that not only do they have to allow Australian businesses to compete, but if they use steel it has to be of Australian standard. Now, they of course are the national rules now. The difference is that what they announced yesterday, and I support Tom Koutsantonis in what he’s announced, is that they’ll have to prove that it’s Australian steel. What currently happens is, sure everyone says it’s Australian standard steel, but it’s not necessarily tested; there’s no certification.

What South Australia has said is that they will require a certification that the steel being used is Australian standard steel. If every state and territory government made that same announcement I think that would be a very positive message to send to Arrium and to BlueScope and to other makers of steel, aluminium products, et cetera. So I would call on the states and territories to follow South Australia’s lead in requiring not just Australian standard steel, but certified as being Australian standard steel, and that’ll make a great difference.

Question: Couldn’t you require the states – if the Commonwealth is going to give them funding for infrastructure, couldn’t you then compel them to adhere to that consumer policy?

Christopher Pyne: Well I’m a federalist, and I don’t believe the states should be infantilised in how they make their own decisions. I would hope that because it’s clear that they can make a difference to the Australian steel industry that they would follow South Australia’s lead on this issue, and the Commonwealth has done its bit. We have, with the powers that I have available to me, given the ADC – the Australian Dumping Commission – instructions around an inquiry into potentially Asian dumped steel, and I will be looking at the duties, if they’ve proposed duties, as they come up over the next few weeks. I believe the states and territories will want to do the right thing, and I’m glad that South Australia has put it on the agenda.

Question: Would the Federal Government consider giving Arrium a financial lifeline?

Christopher Pyne: Look, I think we’re a long way from resolving that particular issue. I notice the South Australian Government – Tom Koutsantonis said yesterday that they have surplus budgets into the years ahead and that they are prepared to support Arrium. There’s a number of ways of doing that, and I think I can say without talking too much out of school that the Federal Government and the State Government are talking about that. I certainly will use the powers that I have at my disposal now, but if there is to be any kind of financial support for Arrium it will take some time to discuss that with the South Australian Government and with Arrium, obviously, and any kind of support like that would need to be a long-term structural reform. We’re not in the business of giving taxpayers money to businesses that are struggling, obviously we didn’t do that with other businesses in Australia, so we would need to be pretty convinced that that was a good idea.

Question: If Whyalla Steelworks doesn’t survive, and if future naval vessels, whether they be offshore patrol vessels or submarines or frigates or whatever, but if they are using this so-called inferior Asian steel, do you see that as a problem for the fleet and security?

Christopher Pyne: No, because not all steel from overseas is inferior. Certainly there is inferior product on the market, but no one assumes that every bit of steel coming in from Taiwan, or South Korea, or China, or France, or America for that matter, or South America is inferior.

Question: So why do we have to protect our own industry if we’re getting so much cheaper but good quality product coming in?

Christopher Pyne: Well I … if the Future Frigates project, which has been promised to South Australia, and the offshore patrol vessels, which will be decided where that will be built in the coming months, and the submarines, which will also be decided in the coming months, it’s very likely that they would use Australian steel as they have before for shipbuilding in Australia. That would be a good thing, but that will not solve the problems in Whyalla right now because the Future Frigates is several years away, the submarines are even further away, the air warfare destroyers are being done now at Osborne, which is a good thing …

Question: And they’ve used all the steel they need from Whyalla.

Christopher Pyne: And they’re using all the steel that they need. So that’s not going to solve our immediate problems. It is an interesting debating point, and my view is that yes, we should be using Australian steel for all of shipbuilding in Australia, and I am very hopeful that that will continue to be the case at Whyalla and at Port Kembla. Because Mark when you look at what Arrium has said, they haven’t said that they will finish steelmaking at Whyalla, they’ve said that they might mothball the plant there for the years ahead, potentially while China works out the glut of steel that they have produced. So it’s a quite nuanced situation that we face, and it’s a serious one. But if China works out its steel glut, as one would hope it will do over the next few years, and I think they will try and do that, when the Future Frigates begin, and then the submarines et cetera, you would think by that stage we would have well and truly reopened the Whyalla steel works. But the trick is, and what we’re trying here in South Australia, to do is make sure that doesn’t happen at all, but I think it’s not the immediate solution to the problems at Whyalla. I mean obviously the iron ore price is the immediate problem, there’s not much we can do about that, whether it’s iron ore, nickel, or other mining- other commodities that we produce.

Question: In terms of securing then future of Arrium – sorry – in terms of securing the future of Arrium, do you see the situation as being completely different to that of Holden when the Federal Government was considering further support?

Christopher Pyne: Well it’s completely different, because General Motors in Detroit said they didn’t want to keep Holden open. General Motors said that it wouldn’t have mattered how much money they were offered by the Commonwealth Government, or any government for that matter, they were leaving anyway. Arrium doesn’t want to close the steel works at Whyalla; they want them to be profitable, I think they’re even happy for them to break even over the next few years. So it’s a completely different situation.

Question: Would you consider investing in the port at Whyalla, the Federal Government, will it consider that?

Christopher Pyne: Well there are a number of matters being discussed between the State Government and the Commonwealth Government. There are a number of priorities for South Australia that I’ve been working on as the Industry Minister and as the Member for Sturt for some time. In terms of the priorities of those, it is obviously part of- in the mix of things that we need to discuss with the State Government, and Jay Weatherill and Malcolm Turnbull are talking about these very issues. Obviously I’m talking to Jay Weatherill and Tom Koutsantonis about them as well, as I have been with [indistinct] for the last six months since I was the Industry Minister, and I’d have to say that the South Australia and Commonwealth Governments are working very well together, because we obviously want to deliver jobs and growth to South Australia and to Australia.

Question: What do you make of Jay Weatherill’s tram plan? I don’t know if you’re aware of it but he’s spending $4 million on looking at a study into where trams should go, perhaps one straight past your office here.

Christopher Pyne: Well I’m a tram enthusiast, I wouldn’t say I was in the league of Tim Fischer in terms of rail. And there’s been talk of course of putting trams up The Parade for a long time, and it’s a very expensive exercise of course.

Question: But he wants your help, he wants Commonwealth money.

Christopher Pyne: Yeah, well I think there will be announcements around rail. I mean, one of the things about Malcolm Turnbull being Prime Minister is that we’re no longer saying that Commonwealth Government money will only be spent on roads. We’ve said that good projects that are rail projects will be considered.

Question: So this could be?

Christopher Pyne: And we’ve announced a rail project on the Gold Coast for example.

Question: That doesn’t worry us. Could the tram …

Christopher Pyne: [Talks over] No it doesn’t worry you, it’s good news for the Gold Coast.

Question: Yeah, good luck to them, but are you saying there is a glimmer of hope that Jay Weatherill’s tram plan might get the Commonwealth money it needs?

Christopher Pyne: Well we haven’t had an approach from Jay about his tram plan. I’m a great tram person, I like catching the tram down to Glenelg with a child for example.

Question: So that’s almost a done deal it seems.

Christopher Pyne: [Laughs] No there are … there are very good projects being talked about right now, including rail projects between the Commonwealth and the state. The tram plan has not been one of them. If it becomes on of them we’ll talk to them about it. But I would caution people about quick fixes to South Australia’s economic difficulties. I won’t criticise the State Government because we’re all trying to work together at the moment, but I think the tram plan is a lot further off than some of the other projects that we can do for our state.

Question: What about the [indistinct] electrification?

Christopher Pyne: Well, you know, rather than sort of going through each project and giving it a tick or a cross, I think what I have said in general probably stands.

Question: Does the Federal Government risk putting the public offside if the election does happen in early July?

Christopher Pyne: Well the election is due in about August or September. So, if there was an election in July I don’t think the public would regard it as an early election. I think that’s a common sense kind of approach. We’re a long way from having an election in July by the way. I mean we want the Senate to pass the Government’s legislation. And if the Senate passes the Australian Building and Construction Commission Bill, and the Registered Organisations Commission, and stops blocking savings in the Senate that they won’t pass, then obviously the motivation for a double dissolution disappears. We’re working closely with parties like Family First and the Greens, they are being very – I wouldn’t say they’re being very cooperative, Family First is cooperative, the Greens are being open to discussing things with us, Labor is just playing politics. It’s that old politics that we see from Bill Shorten today where he says that, you know, we can solve every problem apparently but the Australian Government insists on Australian steel being used in every project. He just leaves out the fact it’s the states and territories that build things and make things, it’s us that gives them the money for it. So I don’t want to play politics with jobs and growth, and I don’t want to play politics with election timing. But obviously if the Senate continues to be obstructing the Government’s agenda, then we could potentially have a double dissolution election, that’s just a fact.