Interview with Laura Jayes, Sky News AM Agenda

Laura Jayes
National Reconstruction Fund; Quantum technology; Interest rate rises

LAURA JAYES: Let's go live now to the Industry Minister, Ed Husic, with your right of reply from Matt Canavan there. Ed, what do you have to say? A white elephant?

ED HUSIC, MINISTER FOR INDUSTRY AND SCIENCE: Well, I mean, it doesn't surprise me that another Coalition person hasn't followed the detail. We announced within our National Reconstruction Fund during the campaign last year, a $1 billion sub-fund on critical technologies. I launched it in Sydney alongside a quantum technology firm, Q-CTRL, that is being recognised for its work. And I said, this is stuff that's really important to us longer term. There are people in the Coalition that get the value of investing in Quantum, not just from an economic security perspective, but they used to talk about this from a national security perspective, so why am I surprised Senator Canavan has no clue what he's talking about? And he hasn't followed the detail there, like their Shadow Industry Minister. So, I don't expect much out of them, but I do expect them to be responsible when it comes to investing in these technologies, that our strategic partners, particularly within the quad, within AUKUS, think that we need to bring those skills to the table and they will be vital longer term in terms of what we're doing.

LAURA JAYES: Do you really believe that national security is at risk if the coalition doesn't support this fund? Because it will pass Parliament anyway, won't it?

ED HUSIC: We think that there well, I mean, these votes are always a choice. It's a choice by the Coalition to back one of the biggest investments in manufacturing capabilities in living memory through the NRF, to back blue-collar jobs, to back regional manufacturing and to back critical technology development. And they're making a choice. They have said point blank they won't support that because they won't support the NRF. And in terms of what we're doing with critical technologies, Laura, we want to make sure that we avoid what Australians get really irritated about, which is hearing stories of Australian firms leaving Australian shores because they couldn't find the capital support to help them grow right here in this country. And we do. We have now recognised for the size of our population, the research that we're doing in quantum, the people that we've got, the firms that we've got, we've recognised, we're being recognised globally as having an edge. We are developing a national quantum strategy to help maintain that edge. But plans are one thing. Having that platform of capital support delivered by the National Reconstruction Fund, that is critical as well.

LAURA JAYES: Okay, and are you saying without bipartisanship that capital is at risk long term, and this is a long-term strategy? It has to be.

ED HUSIC: Well, it absolutely has to be a long-term strategy and you need to contrast Labor's behaviour in opposition to the Coalition's behaviour in opposition? When the Coalition announced support for manufacturing, we backed it in. We think manufacturing matters to this country. The Coalition in opposition when they have a massive chance to back in one of the biggest investments in manufacturing played politics, said no. And this goes and speaks volumes that the Liberals and the Nationals would work with the Greens to undermine support in manufacturing. This is effectively what they are doing and blue-collar workers in Liberal and National Party seats should be asking themselves are the Coalition just mucking around when it comes to manufacturing.

LAURA JAYES: Quantum physics, it's a hard one to explain, maybe they don't understand it. Can you explain quantum physics? 

ED HUSIC: No, I won’t do that here. We won't do it on this programme but there are some firms like Silicon Quantum Computing that are potentially manufacturing at the quantum subatomic scale. I mean, these are some of the Australian smarts and know-how right under our nose. We don't really celebrate enough because tall poppy, we don't want to get full of ourselves. But we've got some really clever Australians that are doing some world leading research, and this is expensive work. And from time to time, they need that patient capital to help them grow. We can be world leaders. We have ambition for the nation, and we want to see it fulfilled through the National Reconstruction Fund.

LAURA JAYES: Okay, let's talk about more, perhaps more immediate problems and this is the state of our economy at the moment we've seen another interest rate rise we've seen the RBA now warn that inflation is nowhere near under control and that there could be three more interest rate rises. Is that the right course of action?

ED HUSIC: Well, we've been put on this inflation trajectory by the Coalition effectively not dealing with supply chain issues we know that those supply side shocks are the biggest driver of inflation growth and therefore triggering the interest rate response. The Coalition were terrible on this, they didn't repair those supply chain issues – 

LAURA JAYES: Little thing called a pandemic though; do you give them a little out there?

ED HUSIC: Okay, well let's take that point on board. I think that's a fair point to make right, but I mean the Coalition didn't order enough vaccines, they didn't have order enough RAT tests and they sent people off that were performing work during the pandemic told them go overseas. We had these huge labour issues where businesses couldn't get people to do the work as the economy started to repair. So, skill shortages, supply chain problems and rising energy costs, which they refused to deal with, these have all contributed, Laura, to some of those supply side shocks that are driving inflation.

LAURA JAYES: Is that why the RBA is now saying the government needs to do more to bring down inflation?

ED HUSIC: Well, there are a number of things. Let me come to that point, but just if I may quickly say, this is in part why we're standing up the National Reconstruction Fund to deal with some of these supply chain issues and reduce our dependency on just a couple of countries for the products we need, is the first thing. And on the stuff that you're talking about, we certainly recognise the impact of cost of living pressures. We do want to provide that cost of living relief, which is why you're seeing cheaper medicines, cheaper childcare and the flag support for energy costs. We do want to repair broken supply chains and we also want to show spending restraint. We're returning nearly 100% of the revenue uplift that we're expecting back to the budget of savings, compared to 40% with the Coalition. So we're trying to do all the right things, the patient work to rein in inflation, bring down interest rates, strengthen the economy, resisted along the way by the Coalition.

LAURA JAYES: Is Stephen Jones right on the money here, or do you think he's being too strong?

ED HUSIC: Right on the money in which regard?

LAURA JAYES: In terms of his criticism of the RBA?

ED HUSIC: Well, I think, look, we've got people that are expressing their concerns about the way in which decisions are made and Stephen – 

LAURA JAYES: I know, I know but he's the Assistant Treasurer and his words probably have a little bit more weight than others. Is he bang on? Are you all behind him on this or do you think he should be quiet?

ED HUSIC: Well, I think Stephen is reflecting the views of a lot of people about trying to get some of these settings calibrated and that we want to make sure that in responding to inflation that we don't crunch the economy. That's the big thing. And it's important to send that signal. We're doing a lot of work as a government; we want to be able to have other things joined up. And I think Steve's reflecting concerns that exist about trying to rein some of the – or just to make sure that we're calibrating action that will ensure that the economy can keep growing, that we can protect jobs and that we do the right thing by inflation and interest rates longer term.

LAURA JAYES: So, three more interest rate rises. I mean, he's concerned about that, that it will smash people that are already smashed, don't have that disposable income anyway and could send the country into recession. My words not his. Is that a concern?

ED HUSIC: I think we are trying to do everything that we can to keep the economy growing, to respond to the inflation challenge, to avoid the need for interest rate increases. The trajectory was set under the Coalition, remember that. And we are trying to make sure that we do all those things and provide that economic stability. 


ED HUSIC: And you are seeing through a lot of what we are doing, Laura, that you can see in terms of the plan, what I've just outlined on those three key areas cost living, relief, supply chains and spending restraint. They form that foundation for all that work.

LAURA JAYES: Sorry to make you late for caucus, I got to let you go. Did you enjoy the Rihanna show yesterday by the way? Some football game?

ED HUSIC: Look, just between us, I don't think anyone else will hear this, I didn't actually see it, I didn't see Rih Rih, so I'm really sorry about that though.

LAURA JAYES: You should catch up with it. Thanks Ed. Get to caucus first though. Thank you.