MICHAEL BRISSENDEN: The Leader of the Opposition in the Senate and Senator from South Australia, Penny Wong, joins me now. Penny Wong, good morning. Why is it that both your government and this government have been looking at this now for more than six years? You had an opportunity to wrap it up, you didnt do it.
SENATOR PENNY WONG, LEADER OF THE OPPOSITION IN THE SENATE: We did a lot of work in, for example, selecting the combat system and putting money into the submarines project. But can I just say lets get beyond the blame game. I know thats where the Government wants to be. We want to get on with building the submarines and we want to get on with building them here. So what Bill Shorten will lay out today is a bipartisan way forward. A two-stage process which has at its core three key principles: that the subs are built, maintained and sustained in Australia; that we get the intellectual property; and of course a guarantee of submarine performance. This is a good process and a good approach. We want the submarines built here because it is good for our strategic capability and it is also good for our advanced manufacturing capability.
BRISSENDEN: Ill come to the economics of that in a minute. But first the Government says it will know by the end of the year what its plans are for subs. If there is an election next year and you win, will you honour those contracts or any contracts that they sign.
WONG: Well what we want is the Government to pick up what we are putting on the table today. I mean the Governments process is a retrofit process, lets be clear. It is an open secret amongst defence circles that the Prime Minister wants the submarines to go to Japan. Because of the furore and because of his leadership ballot he has now had to go through this fuzzy process, a competitive evaluation process which the Defence Minister could not even explain when he was asked about it. What we are saying is go out to market, get all of the people, all of the entities who could potentially build submarines here, dont exclude certain groups because you want to privilege one player over another. Do a proper process with the agreed parameter that it must be built and maintained in Australia. Thats the way you get value for money.
BRISSENDEN: Once these contracts are signed though, this is a very big project as you know, its something that surely any future government will have to honour.
WONG: What we would say to the Government is Bill Shorten today is laying out a bipartisan way forward. Lets stop the blame game, lets stop trading off, as the Prime Minister has, as Tony Abbott has, our largest defence procurement ever for votes in a leadership ballot. Lets do this the right way
BRISSENDEN: I think everybody is talking about votes in this. Votes in South Australia, isnt that essentially what it is about?
WONG: The only vote that counted for Tony Abbott was the votes of the South Australian Liberals in the leadership ballot. And the only job he cared about when he put submarines on the table and that was his own.
BRISSENDEN: You say it is a solution that will produce the best submarines at the best price. But we know dont we that building the subs here would be more expensive? There are some estimates from last year for instance that put the Japanese sub at about $25 billion as opposed to building it and maintaining it here at anywhere between $50 and $80 billion.
WONG: And I could point you to a lot of evidence from experienced submariners and people involved in this who would say what you have just said to me is wrong.
BRISSENDEN: So you think we could do it for the same price?
WONG: I think we do have the capability to build here but more importantly what I am saying is our process will ensure we get the best value for money. Weve got a political decision at the moment that the Prime Minister has made where he says we want to go to Japan.
BRISSENDEN: Well to be fair they havent actually said that yet.
WONG: You might be the only person in Canberra who actually believes that Michael if you put that to me, but fair enough. What I would say to you is the process we are putting out, we are proposing and putting on the table, will ensure the best value for money. And I would refer you also to the evidence from Rear Admiral Briggs and others who said that the current Japanese submarine does not have the capability in its current form to do what Australia needs. So even the current submarine that Japan is proposing would obviously have to be altered quite considerably to meet Australian standards, to meet our capability requirements.
BRISSENDEN: Is it just about value for money because its not really is it. Its about, as many point out, maintaining capability here in Australia. So would a Labor Government be prepared to pay more to keep that capability in Australia?
WONG: We are saying you should put out with an agreed parameter for this process, this request for tender, that the submarines be built, maintained and sustained in Australia. So we get the best price including that parameter. And there are very good reasons for that. There are capability reasons, strategic reasons and there are also financial reasons. Remember the largest cost associated with the submarine capability isnt the acquisition, its the sustainment. We learnt that through the Collins Class. And what we do know is the more you are integrated into the build, the better you will maintain and sustain.
BRISSENDEN: Okay moving on to broader Budget issues. We are in the Budget season of course. What sort of Budget do you think the country needs at the moment, a dull one or an ambitious one?
WONG: Well the Treasurer who says this is going to be a dull Budget, trying to convince everybody he has changed, is the Treasurer who is maintaining a cut to pensions, is the Treasurer who is maintaining a cut to family benefits, is the Treasurer who is maintaining a cut to your schools, your childrens schools, and to your local hospitals. So let everyone understand what a dull Budget means when Joe Hockey says it. He is saying that because they have got themselves into all sorts of political trouble.
BRISSENDEN: Because they cant get their budget measures through the Senate partly because of your intransigence.
WONG: We have passed some $20 billion worth of budget measures and the Government might want to point the finger but I think Australians probably think it is the right thing for Labor and others in the Senate to stand up against broken promises which hurt Australians. But this government cannot, when it comes to this Budget, get its narrative right. Remember the Prime Minister before the last election told you and every other Australian we were facing a Budget emergency. We had net debt at 13% of GDP. He now comes out and says last week, a few days ago, 50 or 60% of GDP, well that is pretty good really. What are Australians supposed to believe? There was a Budget emergency but now they realise that they have actually done the wrong thing and they have got into political trouble, there is no longer a Budget emergency and net debt will increase? Its ridiculous.
BRISSENDEN: You say you have passed $20 billion worth of measures. Why wont you at least pass the $5 billion in savings that you proposed before the last election?
WONG: There are a number of those savings which we earmarked for important things like the Gonski reforms, that is investment in Australian schools to ensure all Australian children have the opportunity to be the best that they can be.
BRISSENDEN: So it is out of spite because the Government has thrown those policies out?
WONG: No it is not. It is saying if you want to pass savings measures which were earmarked for a specific purpose, well maybe you should hold to the election promise you made. Christopher Pyne told Australians there was a unity ticket when it came to the Gonski reforms of Australias schools. That was clearly untrue.
BRISSENDEN: A couple of other quick questions on issues of the moment. Should Australia be part of the China bank, the Asian Infrastructure Investment Bank?
WONG: I believe so and Labor has been saying for some time that we should engage with this. There are really two reasons. Greater investment in infrastructure in our region, particularly, and in developing countries is a good thing for those nations, a good thing for the world. And second it is in Australias interests for China to be deeply engaged in multilateral institutions and deeply engaged with the world. They have expressed an interest in doing that through this institution, I think we should be a part of it.
BRISSENDEN: Just quickly on yesterdays Newspoll. Despite the Governments problems, the two-party preferred basis is back to 51-49. That does suggest as the government says, isnt it that people are having a look at Bill Shorten and he is coming up short?
WONG: My view about polls is first they move around and second people spend a lot of time looking at them. I dont need a poll to tell me what Australians think of Tony Abbott. I just have to talk to voters in my home state. And I dont need a poll to know what people think of this governments series of broken promises which hurts the most vulnerable in Australia.
BRISSENDEN: Penny Wong thanks very much for joining us.
WONG: Good to be with you.