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- [00:05]
A
Well, the government has finally announced its national fuel security plan to help us all cope with the worst global oil crisis the world has ever seen. After meeting with the heads of all states and territories in a special meeting of national cabinet, Prime Minister Anthony Albanese said the government was acting now to be over prepared for any further worsening of the crisis which has resulted from the war in the Middle east now in its fifth week and and showing no signs of stopping. I'm Samantha Salinger Morris and you're listening to the Morning edition from the Age and the Sydney Morning Herald. Today, federal political correspondent Natasia Chrysanthos on what relief Australians will be getting out of this plan and if the government's measures will boost inflation. Welcome Natasia, back to the podcast.
- [00:58]
B
Thanks for having me.
- [00:59]
A
So Tas, first off I've got to ask, do we have a fuel supply shortage problem?
- [01:04]
B
Well, if you're listening to the Albanese government today, the issue facing Australians is not a matter of fuel supply. The kind of biggest issue for Australians and this is being borne out in everyone's bank accounts is cost and is the price of fuel which is, you know, high. $2 plus for unleaded, over $3 for diesel now in many places. So what we saw today was Anthony Albanese come out of a national cabinet meeting with state and territory leaders which had kind of this been this much awaited. Well, much awaited I say, by who? People in this building? Yeah. Highly anticipated press conference. Not quite. But I think the narrative that's existed for the last kind of two weeks or so around the government has been, you know, when is it going to kind of take this united front in this Covid esque acknowledgement of crisis way to tell us what's going to happen next. And so I think we had the government do that today. But very insightfully its message like you say, was not about supply and it wasn't about getting Australians to do anything Covid esque like work from home or start carpooling. Its message was totally focused on cost of living relief.
- [02:23]
A
And so what are the big takeaways from this national Cabinet meeting held on Monday?
- [02:28]
B
So the big takeaways in terms of things that we will actually see happen will be an immediate cost of living relief piece from the government in the form of halving the fuel excise. So that's about 52 cents, that's going to come down by 26 cents a litre. So everyone should see that. 26 cents cut off every litre of fuel almost immediately. And the other thing they are doing, which has a Smaller but more direct impact is eliminating altogether their heavy vehicle road user charge for truck drivers basically. But that's expected to flow through to things like supermarket prices. And combined those two things will be in play until the end of June. So for the next three months, which is quite neatly until the next four financial year. And the cost to the budget will be about $2.55 billion in that period.
- [03:23]
A
We also heard the government announce that it will be backing the private sector to help guarantee that we're going to continue getting enough oil and petrol into Australia. Is that right?
- [03:33]
B
Yeah. So the government's big focus the last few weeks and in terms of its public messaging as well, has been on what it is doing to secure supply. And I think what one would kind of gather from its comments today, you know, particularly from Energy Minister Chris Bowen, is that the government does seem confident about continuing to secure supply. Again, a lot of talk over the last couple of weeks has been, you know, it wouldn't be till like April or particularly May when we actually saw an issue because the full effects of the war will have flown through by then. You know, it takes ship's time and all that. And so the kind of drop off a cliff of supply hasn't actually happened yet. And so there has been speculation that, you know, late April, May is when we'll actually see that take its full effect. But I think if you listen to the government today, they sound pretty confident that they will continue to shore up supply and you know, whether that's because they're just willing to pay what they need to what they need to and work with industry to get fuel flowing.
- [04:43]
A
Okay, but what did the government say about any plans to help us for the longer term? Whether it's just to help us, you know, with cost of living or to make sure that we have enough supply of oil and petrol? Because Prime Minister Anthony Albanese, he announced a four stage plan. He said we're currently in stage two. So did he flag any restrictions on petrol buying or any other restrictions that might come into place once we get to say April or May or the war lasts longer and you know, things sort of start getting tougher.
- [05:15]
B
So this national plan that came out today is a four stage plan. You know, stage one is called Plan and Prepare. Stage two is called Keeping Australia Moving. Stage three is called taking targeted Action. And stage four is protecting critical services for all Australians. There are only a few dot points in the kind of public version of this plan that we can see. But the where they've placed us right now is on this stage two, keeping Australia moving. When we get to stage three is when we have, you know, governments continuing to act to get supply in, but perhaps looking for people to take practical voluntary measures to reduce demand. And then stage four is where it looks like we get to kind of mandatory measures to reduce demand. And so the government was a bit wishy washy, I guess, on precisely what this would entail. We had the International energy agency about 10 days ago, now maybe come out with this list of advice for governments on ways that consumers can reduce demand or governments can make consumers reduce demand. And that was looking at things like work from home, carpooling, fuel rationing. And our government at that point kind of said thank you. That's, that's, you know, not mandatory advice and not an instruction. I suppose we could assume that when we do get to a level 3, 4 situation under this plan, that's where you see some of those measures come in voluntarily at first and perhaps in a mandatory fashion afterwards. But crucially, this plan and the Prime Minister day didn't spell out those measures. You know, he was asked about Easter long weekends which are coming up. People often travel here, kind of said, go about your business as normal. So there was nothing in today's message that suggested that people should change their behaviour when it comes to consuming fuel. Of course, that could be because fuel prices are setting a behavior signal anyway, right? Like when fuel is so expensive, you are more likely to turn to public transport, avoid long trips and so forth. And perhaps for the government that's enough. Also, I guess a key part of the government's message so far has been there. There is no problem with supply that would require people to change their habits. Actually, the biggest issue and why we're seeing shortages and whatnot has been because of panic buying and things like that. Which is why I think their message at large is focused on trying to keep kind of panic out of the conversation to deter that kind of behavior.
- [07:46]
A
And you're right, I think the, the message from the government was perhaps, you know, you said wishy washy. I definitely don't disagree. It was pretty soft. And we heard the Prime Minister asking people to, quote, do the right thing, unquote, and voluntarily, just not buy more than they need to not panic buy. Now, I'm not sure what kind of impact that will have on people, whether they will just kind of go, okay, I will panic buy. I secretly sort of think, you know, people might continue doing that. I don't know. But I guess when, when could there be fuel rationing was There any indication as to when there will be involuntary measures placed upon us to help with this crisis? Because of course none of us know when this is going to end. I mean, if anything it's, it's getting more inflamed in the Middle east. More countries are sort of becoming involved. It's, it's not settling down well again.
- [08:32]
B
And, and the government wasn't super specific about what these thresholds looked like. Like there wasn't a kind of quantifiable figure as to when we progress to level three and when we progress to level four. But in general it's when supply is disrupted and according to the government that has just not happened. So there will be a kind of activation of those future levels if and when there is a problem with supply. But as we were kind of talking about earlier, the government is kind of projecting this confidence that that's not going to happen.
- [09:12]
A
We'll be right back. Okay, so I guess was there any discussion about whether we could see any Covid style mandates to deal with the fuel crisis? Because we know that Liberal leader Angus Taylor, shortly before this conference he gave an interview and he said, you know, we oppose heavy handed mandates. We saw enough of that during COVID I don't want to go. So did the Prime Minister or anyone in his cabinet or otherwise address that at all?
- [09:40]
B
Well, I don't think the government wants to go back to it either. I don't think kind of mandated behaviours with penalties and so forth kind of conditions that people like living in. And I don't think it's where the government wants to be. And so I think it kind of goes back to what we were just saying where when we get to that level four kind of dire supply disruption situation. Yeah. Perhaps you'd see some kind of mandatory measure. But it very much is a final port of call according to this plan. Like we can see that the government wants to a just focus on people's kind of goodwill and being sensible at this point. If it needs to and it goes to level three, it will give directions but they will continue to be voluntary. And I guess it's only if things got really bad that we'd see a kind of COVID era enforcement regime as to some of these things.
- [10:27]
A
Right, okay. And what about any other sort of financial help that Australians have been given as a result of this national cabinet? Because we know that a couple of states are I believe offering free public transport to try to sort of alleviate that pressure, of course, on people buying petrol. So tell us what, what if anything, we saw in this space.
- [10:45]
B
Well, yeah, the two key things we saw were the fuel excise and the, the heavy vehicle charge. You have seen states like Victoria and Tasmania go and give, you know, relief when it comes to public transport. But that's something that states can kind of agree to do. And also, you know, the broader context for all of this, of course, is like inflation has been on the rise for the last little while. We've seen two interest rate rises from the Reserve bank trying to get people to tighten their wallets. These measures, be it kind of fuel excise reduction or free public transport, put more money in people's wallets. You've kind of got the Reserve bank and the government here working against each other. And I think there'll be economists today who are very concerned about what will happen now that, you know, an extra two and a half billion dollars could be released into the economy because of this fuel excise relief. And I think the RBA will then have to factor that in to its next decision. There's a chance that it then raises rights again to offset the benefit that people have gotten and it kind of prolongs this situation that we're finding ourselves in. And that's a difficult position for Treasurer Jim Chalmers as well.
- [11:59]
A
Well, I wanted to ask you whether some of our colleagues in Parliament House there, where you, where you're normally working, are pulling their hair out or sort of kind of freaking out about the public transport being free and also the having of the fuel excise. Because I know that our colleague, our esteemed economist, specialist colleague, Shane Wright just the other day wrote with regards to what might be announced at the National Cab, if there's a dumb idea, it's being embraced by people who should know better. So he might be pulling his hair out today. I don't know. I haven't seen him. Taz, are you seeing anyone pull their hair out?
- [12:31]
B
Oh, I, I, I'm seeing Shane. I'm seeing Shane's hair full fall to the floor in little pieces. Some of our regular readers will be familiar with Shane's work. You know, Shay is a very, a very balanced and experienced economics writer, but this has been one that he has very strong opinions on this week. And he is tapping away at a sequel to his drongo piece from last week as we speak on Monday afternoon. But his take was very much that, you know, this is unnecessary right now. He is tapping away at his sequel right now and that's because he shares those, those concerns of economists that both of these measures are a unnecessary because The Reserve bank is pumping up rates, it is trying to squeeze people to put a brake on inflation. And this is just kind of running counter to what the RBA was doing just a few weeks ago.
- [13:27]
A
Yeah, well I'm no economist but I definitely was swayed by Shane's previous column in which he said that in 2022 the Scott Morrison government have fuel excise for six months as it desperately tried to stay in power. And that single decision injected $5.5 billion into the pockets of consumers. It's no surprise that inflation accelerated through that period as this 5.5 billion sloshed around the economy. Now that's six months. Now at the moment the government has announced only a three month fuel excise having. So it's, it's, it's obviously a difference there but we know that the Prime Minister and the Government general was pressed on this at the presser where journalists were asking questions and our colleague at the Australian Financial Review, Phil Curry, he asked is there any offsets for the fuel excise? You know, is, do you have plans to pay for them somehow or we're just going to add that to the pile when it comes budget time. And the Treasurer, Jim Chalmers sort of batted that away and said well we've got a long way to go to finalise the budget. So do you think they're as worried as the rest of us or are they just not worried and we're just going to get kicked by inflation?
- [14:30]
B
I think Jim Chalmers should be very worried and I think he is, he is worried and he's been flagging for the last few weeks as well. You know, this is going to be a tough budget of hard decisions or tough decisions. People are ready for them. I think there's a lot riding on in terms of public expectation for the government to use its, you know, giant majority to take some kind of bold political move to address intergenerational inequality, for example. And I think Chalmers has flagged that that's also of interest to him. But now he's been handed this extra curveball and you know, this was also going to be a belt tightening budget. Well, it's just lost an extra $1.5 billion overnight in terms of fuel relief. So they will be really looking to find those savings elsewhere in the budget while, you know, delivering on these kind of more urgent cost of living concerns of people while at the same time any decisions the government makes will also, you know, be part of the picture that influences the RBA's decisions in terms of it continues to raise rates. So no wonder. Chalmers is saying that a lot of these decisions are coming down to the wire and still won't be finalised for several weeks. There'll be lots of tired treasury officials and bureaucrats around Canberra as we approach mid May. I'm shocked.
- [15:48]
A
Oh, I absolutely bet. Well, thanks, Tas, for your time.
- [15:52]
B
You're welcome. Thanks, Sam.
- [15:57]
A
And in other news today, Sydney scientists have said in a first of its kind paper that vaping probably causes lung and oral cancer. This contradicts the idea that vaping is a safer way to smoke and boosts the urgency of efforts to stop a new generation of young people becoming addicted to nicotine. And Parapanga police killer Desi Freeman was shot dead after seven months on the run. Police were tipped off that Freeman was hiding in a shipping container on a regional property. The search involved more than 450 officers and has been described as the largest tactical operation in Victorian policing history. For more coverage of this developing story, details on Freeman's final moments and the squalid Bush encampment where he died, Visit our websites theage.com au and smh.com au Today's episode was produced by Josh Towers. Our executive producer is Tammy Mills, and our podcasts are overseen by Lisa Muxworthy and Tom McKendrick. If you like our show, follow the Morning Edition and leave a review for us on Apple or Spotify. Thanks for listening.