RICHARD KING, HOST: Somebody would be very happy about Newcastle producing steel beams for the museum is our Industry Minister, Tim Ayres, who joins me in the studio. Thanks for coming in, Tim.

SENATOR TIM AYRES, MINISTER FOR INDUSTRY AND INNOVATION AND MINISTER FOR SCIENCE: G', day, Richard. It's always good to be on the show and great to be in the studio.

HOST: Look, you're addressing Hunter Business Group this morning, I believe. 

AYRES: Yeah. I'm looking forward to an early breakfast with Hunter business community. It's a really important opportunity to talk with them again about the Future Made in Australia agenda and our work to reindustrialise our outer suburbs and our big industrial regions. And there's nowhere more important than the Hunter Valley on those questions. We have enormous opportunity here, enormous industrial capability. We make things here in the Hunter Valley that make Australia stronger and contribute to our economy and our productivity. It's a proud legacy and I'm determined to keep putting the shoulder behind the wheel to keep building that.

HOST: And we produce aluminium here, at the Tomago Aluminium smelter. And of course, the cost of energy for them once their current contract expires is a very hot topic. I've spoken to you about this before and a number of other MPs. Where's it at, at the moment, Tim?

AYRES: Well, just maybe two answers if I can, Richard. The first is in Australia we have an end-to-end aluminium supply chain, from bauxite, alumina, to aluminium metal to aluminium products. It is aluminium from Tomago that goes to Capral Aluminium that's used to build Australian naval assets, for example, that are crucial for our national defence. It's aluminium from here and from the Boyne smelter that goes into food packaging, to building products, to all sorts of things that are vital the Australian economy and for our export partners around the world. It's an important national asset. 

We are working through, as you indicated and as the Prime Minister and I indicated late last year when we went to Tomago to talk to workers and the management about this question. We've identified the way forward and that is to go to the heart of the competitive challenge for Tomago Aluminium. This is not an inefficient facility. This is Australia's youngest and largest aluminium facility. What it requires, of course, like all aluminium plants require, is low-cost electricity. That's what we achieved in Queensland with the Boyne smelter, the Albanese Government and the Crisafulli Government working together. A $1 billion contribution from the Albanese Government, a $1 billion contribution from the Crisafulli Government and $7.5 billion from Rio Tinto investing in new electricity generation in Queensland. That's a slam dunk economic outcome for Queensland. It means downward pressure on electricity costs, not just for Rio Tinto but also for every business and household in Queensland because we're building more electricity generation in long-term Power Purchasing Agreements that back that facility. 

HOST: Well, I get emails and calls from people saying, look, Rio Tinto, you know, it's a very successful company. Most of the profits disappear overseas. They're making a fortune. How come we're bailing out a very successful, very profitable company?

AYRES: Well, with respect to those contributions, I understand why some people feel that way, but I just challenge that kind of thinking. This is not a bailout. This is securing a modern electricity system that provides competitive electricity prices for Tomago Aluminium, for the Boyne smelter, for future industrial electrification efforts. This is Australia's competitive advantage for the future – additional generation, a modern electricity system that means that we're turning Australian ore and raw products into metals and advanced manufacturing products for the world. This is Australia's future competitive advantage. And the scale of the Tomago effort, it's around 12% of NSW electricity.

HOST: I think it's the biggest single user in Australia, isn't it?

AYRES: Yeah, it's – we shouldn't see that as a deficit narrative. That is a huge opportunity for additional electricity into the system. The owners of Tomago have made it very clear that they want to see investment in a Power Purchasing Agreement that is in wind and solar and storage because that is the lowest cost electricity for them. It's not an ideological choice for them. It's a straight-out commercial decision that, in order to secure low cost electricity, that's the direction they need to go in. And that's an opportunity for us all to work together to – 

HOST: Well, you talk about working together and you said you've successfully achieved that in Queensland with the Crisafulli Government, but it would appear you're having trouble coming to a compromise with Chris Minns and the NSW Government, Tim.

AYRES: Well, there's weeks and months of effort to go here. If it was easy, it would have been done 12 months ago. This is hard work. At the moment, the Commonwealth Government's working with the facility and with the electricity sector to make sure that we've got the most effective Power Purchasing Agreement possible. And we'll keep working with the NSW Government as we go, approaching this in a really programmatic way. As I say, if it was easy, it would have been done. This is hard work because it's important work. It matters for thousands of jobs here in the Hunter Valley, but it also has significance for the state economy and for Australia's economic resilience. This is all about making sure that we've got the industry capability that we need for the future to make Australia stronger and to deliver good jobs. 

HOST: My guest, Tim Ayres, is NSW Senator, Minister for Industry and Innovation and Minister for Science. He’s here to address a Business Hunter breakfast this morning. Look, it's not under your remit, but I mentioned earlier that veterans’ leaders have accused the Albanese Government of compromising Australia's national security by selling off, well, the spiritual home, Victoria Barracks, but many other defence sites around the country. A lot of people highly critical of that, but the argument being these are not being used at the moment, we need land, etc. Your response to that?

AYRES: Well, of course, it’s ANZAC Day tomorrow. And veteran leaders and veterans’ organisation leaders are absolutely entitled to be part of a public discussion about these, about these national assets. And I have to say today, my focus is, of course, on the importance of tomorrow's commemoration of Anzac Day and to encourage everybody to be part of your local Anzac Day events. It's important for veterans, it's important for the country, but I think it's really important for all of us to be part of it, actually. It's an important opportunity for a few hours of quiet reflection on what it is that makes Australia great, what makes Australia a place that reflects on its military heritage in that way and commemorate the awfulness, really, of military conflict and war and celebrate those people who have done that on behalf of the country. 

We are, with focus and purpose, investing in additional military capability for Australia because we live in a more uncertain world. The Deputy Prime Minister and Defence Minister was out there last week, committing an additional $53 billion of Commonwealth expenditure in new military capability to make Australia stronger, to improve our deterrence capability. And, of course, we're bringing that same focus to all of those defence assets around the country, making sure that all of them are working towards delivering additional defence capability. And we've done it in a very public way. No lack of transparency here. And we'll engage with the veteran community and more broadly in a respectful and careful way, because these are important issues for the country. 

HOST: Hear, hear. I'll let you go now and enjoy that early breakfast but thank you very much for popping in this morning. I was going to get into you about – I’m a boomer and I was reading an article this morning that it's not a good time to be a boomer. I know Mark Butler is talking about, and I believe the Treasurer as well, is intergenerational equity. And I know over 65s have lost that rebate now for private health insurance.

AYRES: Well, you're not much older than me, Richard.

HOST: You’re coming after us, Tim!

AYRES: I wanted to talk about the fact I can see that Ron from Shortland, the Secret Sound winner, won $3,175 in the Secret Sound. Like, that is a blast from the past – 

HOST: If you stick around for another hour, you might win $750.

AYRES: Well, if it’s Tim from Sydney, you’ll know who it is.

HOST: Good to see you, have a happy and a very safe Anzac Day Long weekend, Tim.

AYRES: Thanks, Richard. Appreciate it.

HOST: Tim Ayres is NSW Senator. He is also the wearer of many hats now, Minister for Industry and Innovation and the Minister for Science, on 2 HD.