27
Jan
2019

Morrison Falls Short of Coherent Leadership; Victorian Coalition Likewise.

Morrison’s Behaviour Raises Questions About His Leadership

My previous Commentary have argued that, as a Coalition leader facing an election, Scott Morrison needs to get cracking on enunciating policies asap in the New Year. But although active since early January, he seems to have focussed on matters which are mostly “organisational” and would have limited appeal to the electorate in general. Indeed, his poor handling of some of these matters might even have attracted negative comment or a sort of “well what was that all about”.

Now we have a situation in which three of his ministers have said they will not stand again but, in what seems bad strategy for the Coalition, will remain as ministers right up to the election and yet whatever they pronounce will have no application as future policy in itself. Morrison’s response is that such “refreshing” is normal but it gives the appearance of rats leaving a sinking ship (see Morrison Loses Three Ministers). Moreover, while the “pick” by Morrison of former President of the Labor party, Warren Mundine, for the seat of Gilmore should help retain that closely fought seat, Morrison seems to have mishandled the arrangements for the de-selection of a popular local candidate and he felt forced to publicly attack that candidate. This has apparently upset not only the candidate but other local Liberal members, some of whom resigned. It will not have helped the next Newspoll by the Coalition.

Today’s article in the Herald Sun by Peta Credlin points out that, while Mundine “delivered a devasting indictment of the party that had been his DNA for decades”, the “immediate attention of the media focussed on the cack-handed way the former Liberal candidate was replaced and the unhappiness of local branch members. Instead of Mundine’s move signifying just how much the coming election matters, its been treated as further evidence of Liberal chaos” (see Re: Credlin on Mundine Highlighting Added). With what is almost despair Credlin adds “As you know, I’ve been a critic of the current government for not being sufficiently different from Labor, whether that’s been rolling PMs or pandering to the green lobby by destroying Australia’s energy advantage. But for all the government’s mistakes, Mundine’s move highlights the gulf that still remains between the two big parties. Labor’s instinct is always for more spending, more regulating and more taxing, especially on anyone who works hard to get ahead”.

Importantly, neither Morrison nor his Energy Minister (Taylor) seem to have been able to indicate why they have not made any substantive change in energy policy and/or how they are going to effect the promised reduction in electricity prices. Alinta, one of the our large retailers, has indicated that no reductions are likely in the next 18 months. If correct that would follow the about doubling of wholesale prices in Victoria over the last six years  (which covered the closing of Haxelwood) and similar increases in other states.

Note that Alinta  was bought by a Chinese group in 2017 “from private equity for $4bn as part of a wave of foreign investments targeting growth opportunities in Australia’s power and utility sectors following a jump in gas and electricity prices over the past few years” ie it would seem that the Chinese saw that the increased prices offered high returns and no effective action was subsequently taken by the ACCC to try to ensure competition, rather the so-called regulatory solution. (see Power Prices To Rise further). The implication is that Atlinta feels that any policy changes by either the Victorian or Federal governments will be accompanied by price increases.

Indications remain (but without detail) that, to ensure (sic) reliability and to control prices, the Morrison government will likely announce a highly regulated energy policy, possibly in the budget.  Such a de facto nationalisation would naturally suit Labor, which has been attributing part of current problems to privatisations undertaken by former Premier Jeff Kennett. But instead of pointing out the gross inefficiency of the SECV when he came to office, the latter’s main contribution to existing political difficulties facing the Coalition seems to be to push some of the oldies in the Liberal Party to resign, including existing “conservatives” such as Kevin Anderson and Tony Abbott.  Yet Morrison shows no sign of even bringing them back as ministers, even though that should at least improve the image from the existing left of centre!

The concern which the extreme left feels about a return of Abbott to the Coalition ministry is indicated by the front page article published by today’s Age. It is headed   “An Olympian’s Task: to kick out Abbott” and written by two journos, Peter FitzSimons & Bevan Shields, whose writings would raise a question about The Age’s claim of being “always independent”.  According to these two, “World champion athlete-turned-barrister Zali Steggall has called time on Tony Abbott’s “destructive and divisive” 25-year career in federal politics, launching a major bid to seize the former prime minister’s blue-ribbon Sydney seat of Warringah…  the four-time Winter Olympian said Mr Abbott was an “aggressive” national figure who had lost touch with the affluent electorate and deserved to be thrown out of Parliament for his role in the demise of Malcolm Turnbull, and views on the environment… Tony Abbott, who has been a handbrake on Australian progress on many fronts but particularly effective action on climate change”. (Note that my first message conveying this article was rejected because “the content was rejected due to suspected spam”. When I sent the same message again the suspected spam had disappeared!).

The Coalition’s (Federal & Victorian) failure to enunciate a coherent energy policy was important in the abysmal handling of the policy during the heat wave and may well constitute another challenge or two in the period ahead if (as is forecast) further high temperatures occur. In considering the various policy “explanations” it is pertinent to assess what the main policy makers said that during the heat wave yesterday (see The Incredible Story of Vic Energy Policy under “Extreme” Eventsextracted from reports/comments in yesterday’s Australian):

  • Federal energy minister Angus Taylor said the government was closely monitoring the energy situation in Victoria and thanks AEMO for the job it has done managing a difficult situation in collaboration with the wider energy industry. “The conditions experienced over the last two weeks across the national electricity market reinforce the need for investment in reliable 24/7 generation and the retailer reliability obligation.“That is why the government is backing in new reliable generation investment through its Underwriting New Generation Investments program which has had strong responses to its registration of interest process that closed on 23 January.“The government will carefully consider all proposals and will have more to say once we have considered all the submissions and feedback received during this process.”
  •  Labor leader Bill Shorten said he was very concerned about the load shedding, suggesting the Morrison government was partly to blame.“Ever since the federal government said they could lower power prices and took responsibility for the power debate, it’s now partly on the federal government’s head this challenge of blackouts,” Mr Shorten said.“They’re the ones who said that renewables were a waste of time – well they’ve been in charge now for the best part of six years.
    “I do expect the federal government, having said they could lower prices, to do more for the reliability of the system rather than just blame the states but it is most serious and let’s just keep our fingers crossed.” Mr Shorten said the last six years of energy policy had been a disgrace.“While this government has been debating the scientists and the community about renewable energy there has been a virtual freeze on investment in power generation and now sadly when we need our power the chickens have come home to roost,” he said.  “While you have a government that can’t deliver a coherent national power policy, there will not be investment in new generation and where you don’t have investment in new generation, sooner or later the old generation will fall over and then we face these sorts of crises.“To me it highlights everything that’s wrong with the LNP and the Liberal government in Canberra in 2019 – they spend so much time arguing about the politics, and now we’ve wasted 2000 days and we’re no better off, indeed we’re worse off, than we were six years ago.”
  • Victorian Energy Minister, Ms D’Ambrosio said voters had spoken loudly and clearly on the Coalition’s credibility on energy policy at the November election.“They had no energy policy. The only energy policy they took to the last state election was to build a new coal-fired power station which – even if you started building it today – would take eight years to come”.  “No-one is prepared to finance it, and we can see that the problems we’ve got now is that we’ve got a 20th Century system for a 21st Century climate, and the fact is our thermal generators are ageing, they are becoming less and less reliable.“That has been palpably evident in the last couple days.” “More energy supply is available to us in Victoria this summer than it was this time last year. That’s because of our strong emphasis on renewable energy: the quickest form of energy to be built, the cheapest and, of course, if we have a look at today, the most reliable.“Wind power came through today. Wind power produced sufficient power generation – as was anticipated.“Our batteries – our large batteries – were available last night when we needed them the most.”  AEMO data showed the batteries generating just 25 megawatts of a Victorian total of 8,622 megawatts at 7pm last night.
    Wind is currently generating 8.1 per cent of Victoria’s energy.
  • Victorian opposition leader Michael O’Brien said the load shedding today in Victoria has shown the failure of the Andrews government’s energy policies.“Something is seriously wrong when the power goes out in Victoria because we don’t have enough supply,” the Liberal leader said.“On a day of extreme temperatures, there are serious health and safety concerns with deliberately cutting off supply.“When Labor policy led to the closure of Hazelwood Power Station, the Liberals and Nationals warned that Victoria was left exposed.“We are not a Third World country. We deserve a safe and reliable power grid.
    “Daniel Andrews loves to boast he’s good at ‘getting things done’. Keeping the power on would be a good start.”
  • Victorian opposition acting energy spokesman David Southwick said it defied belief that in a first-world country like Australia, Victoria has a state government that can’t guarantee enough electricity for people to go about their daily lives.“Melbourne is currently hosting thousands of international tourists for the Australian Open who must be wondering why the state government is asking its citizens to refrain from using common household appliances to prevent large scale blackouts,” Mr Southwick said. “Most Victorians agree that renewable energy is the future but we need to make it a sensible transition that doesn’t threaten power supplies and cost Victorians a fortune.“Daniel Andrews owes all Victorians an explanation as to why he can’t keep the lights on.”

Conclusions

Readers of this Commentary will recognise the ineptness of these statements of policy makers, both Liberal and Labor. Of course, Australia can increase the usage of renewable but the limited wind yesterday showed that they produced only 8 per cent of power in Victoria. This low contribution occurs quite frequently (similar low contributions occur in other states). If the reliance on renewable is increased so too will there be a need for considerable additional investments in back-up power sources, such as gas and diesel. This futher addition to the cost of producing power requires either additional subsidies by taxpayers (already large) or further increases in prices (already doubled in the last six years). A reduction in the unnecessary government restrictions on investment in gas would also help as it has enormously in the US.

The cost of producing more power, and reducing electricity prices, would also be reduced if the existing policy of reducing emissions from coal usage was either dropped or substantially reduced and the non-binding agreement in Paris was dropped or reduced.

A belated Happy Australia day

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