National Interest

You'd expect any premier who is forced to plead for people to switch off their heating in the midst of a man-made gas crisis to be heading for electoral oblivion. But Alan Carpenter is Western Australia's teflon premier and his management style during the crisis has just added to his community cred. It's an amazing political story because nothing seems to stick: not the Brian Burke scandals, not the ministerial sackings, not the factional biffo within the Labor Party. With an election expected by early next year and a state opposition in disarray, 'Carps' could well be on a winning streak. We take the Premier through WA's political landscape and ask him for the secret to his Midas touch.

Transcript

This transcript was typed from a recording of the program. The ABC cannot guarantee its complete accuracy because of the possibility of mishearing and occasional difficulty in identifying speakers.

Peter Mares: You'd expect that a premier who is forced to plead for people to switch off their heating in the midst of a man-made energy crisis might be in a bit of trouble - especially with an election around the corner.

But Alan Carpenter's management of the W.A. gas crisis seems only to have improved his public standing.

It's a remarkable political story because nothing seems to stick; not the Brian Burke scandals, not the ministerial sackings, not the factional biffo within Labor Party ranks. And with the State opposition in disarray, it seems the Premier is on a winning streak.

As part of our ongoing series of interviews with premiers and chief ministers around the nation, Alan Carpenter joins me in The National Interest. Premier, welcome to the program.

Alan Carpenter: Thank you very much Peter for a very flattering intro.

Peter Mares: Well, how serious is the gas crisis now?

Alan Carpenter: Well, it's a serious situation for Western Australia, there's no doubt about it. It happened in early June. We lost about 30 per cent of the gas that comes down the pipeline from the north-west for our domestic consumption and we've had to adjust. We still haven't got that gas back on in supply yet and there's been issues for customers, gas users, especially in the medium- to small-businesses who rely on gas, and we've had to manage. But look, the fact of the matter is that Western Australia has come together very well here and everybody, I think, recognises this was an issue for the whole State, and there's been a great co-operation, great co-operative spirit from the government and business and ordinary householders.

Peter Mares: The media suggested that people didn't take you very seriously when you asked them to turn down their heating.

Alan Carpenter: Well, they did. And the figures show that. Just to let your listeners know, what I did was to get a two-minute spot on all the television network news [services] in the first week of the gas situation and explain what had happened - how long it might be before we got into total production and the impact. And [I] asked ordinary householders and business to - as best they could - reduce their gas consumption and other electricity consumption because much of the electricity on the south-west network is gas-fired. And we got a very good response.

Peter Mares: There's something fundamentally wrong, though, isn't there?, when a resource-rich State like Western Australia loses its gas supply...

Alan Carpenter: Well, yes. It depends how sophisticated an analysis you want to go into. We are very resource-rich and a great part of that rich bounty is our gas, much of which - not all of which, but most of which, the bulk of which - is off the north-west coast and north coast of our State. To transport that gas, that which is not being sent overseas in LNG shipments, to transport that domestic gas down a pipeline is a very long way. And one of the domestic gas production units on Veranus Island, which is off the north-west coast, blew up, and we lost the gas from that production unit - over 300 terajoules. It was about 30 per cent, as I said, of the total production. Now, there's only so much you can do when you've lost 30 per cent of your gas production to ameliorate the impact - no matter what wishful thinking there might be about miraculously finding other sources of energy.

Peter Mares: Critics point out that you were energy minister before you were premier, so you oversaw the situation in which this event could happen, that there was a lack of, I suppose, fallback options if something like this occurred.

Alan Carpenter: Yes, well, put it this way: in other jurisdictions around the world, where you've had similar incidents or catastrophes, ordinary citizens have been plunged into blackout. And that didn't happen [in Western Australia]. And your introduction basically said that Western Australians recognised that it's been managed fairly well. It's not perfect, but it's been fairly well, and the reason we've been able to do that is because we have a multiple of energy sources and when we lost our gas-fired capacity we were able to switch - to some extent, not totally, but to some extent - to diesel-fired capacity. The problem being, of course, that we were also going through a period where world record prices for oil and diesel fuels were being reached every day. So, switching from what was fairly cheap gas production for some people to very expensive diesel-fired was an economic decision that some of them shied away from. But if you lose that much of your energy capacity, there's no easy fix to it and most of the suggestions that were put forward were fantasyland stuff.

Peter Mares: You have suggested, though, that in the future W.A. needs to secure supply through diversity. What do you mean by that?

Alan Carpenter: Well, a couple of things have happened. When I was the energy minister, I was also the state development minister and I insisted on behalf of the government, and I did when I became the Premier, I insisted on behalf of the government that 15 per cent of the gas reserves off the coast be set aside or reserved for domestic consumption, domestic production, rather than every molecule of it being allowed to be shipped overseas in export for LNG.

Peter Mares: Something which didn't please the big energy companies one bit...

Alan Carpenter: No. But ordinary people, I think, saw the wisdom of it and I don't think anybody, given what's happened just now, anybody would now be arguing that it wasn't the right thing to do. Obviously...

Peter Mares: Well, some people argue that by setting constraints like that you'll actually create disincentives to investment; that big companies won't invest because they don't want to be subject to those sort of restraints and therefore you'll actually damage the industry.

Alan Carpenter: But Peter, honestly, nobody sensibly argues that. The fact is, if you have a look at the oil and gas industry around the world, nearly every other place, nearly every other jurisdiction requires a lot more of the contribution to the domestic economy from projects, proponents and producers than what we are doing. If we had simply allowed every molecule of gas from our gasfields to be shipped into LNG, they would have been...

Peter Mares: Because the prices are higher...

Alan Carpenter: ... the prices are higher, and you would have been confronted with a situation analogous to the Saudi Arabian government telling the citizens there was no petrol because it had all been shipped outside of Saudi Arabia. It's ridiculous, a ridiculous suggestion, and I used to get it from people like Ian Macfarlane when he was the federal resources minister, who simply had no idea of the structure of the Western Australian economy. The people who ran that sort of argument were either 1) completely ignorant or 2) they were simply following the wishes or representing the wishes of the big producers.

Peter Mares: I seem to recall some of them were chief executives from large producers, so are they completely ignorant of their industry?

Alan Carpenter: And I respect that point of view from them because they have to represent the interests of their shareholders. And if they can maximise their profits by sending all the gas in LNG form to overseas markets, well, of course that's what they want to do. But in the meantime, anyway, the strength of the West Australian economy and the growth in demand for energy has seen that the price for domestic gas reached almost what is called LNG net-backed prices, so there's not that much differential anyway. So, it's become much more attractive commercially for people to start exploring or developing domestic gas production. But look, I made a decision on behalf of the government that Western Australia would require plenty of gas to fire our economy in the future and I was determined to secure that... And I've done that. Can I just say that the other issue about multiplicity of sources... We also have coal; a lot of people probably in other parts of Australia don't understand that Western Australia's economy used to be actually coal-fired: we have a coal industry in the south-west of the state; now we have gas and we also obviously have diesel and they're building renewable energy stock so that we have as many varieties, as many forms of energy from as many supply points as we possibly can. And that's the only way, really, I think to insulate yourself against the sort of occurrence that we are experiencing at the moment.

Peter Mares: Mr Carpenter, given that your two-minute spots urging people to conserve energy went down so well, and you're up in the polls and the opposition is in somewhat disarray, when can we expect the early election?

Alan Carpenter: Well you know, you'll know at the time. But can I just make some points about this? Look, first of all there are some issues that we are still addressing here in Western Australia, and the gas issue is one of them. We anticipate we will get at least two-thirds of that lost supply back in production within the next few weeks and I want to make sure that that is going to happen. We have got issues about the sentencing regimes in our judicial system over here which need some adjustment and we need to get a clear position on that at least, even if we haven't legislated to fix it. There are still challenges there for the government and I'm not too fussed - and you might find this hard to believe - but I'm not too fussed about what's going on among my opponents in the Liberal Party... That's really for them, that's a matter for them to sort out. I want the public to look at me and the government I lead and make judgments on our performance, not judgments on the performance of our opponents, if you see what I mean. I want to give people reasons to feel confident in voting for us and myself in government, confident that we've got the leadership and the vision and that we are placing the State for long-term economic success. And the opposition... They can take care of themselves.

Peter Mares: Well, maybe you could call the early election for AFL Grand Final weekend, since there won't be any W.A. teams in the competition...

Alan Carpenter: Well, thanks very much for reminding me.

Peter Mares: Look, at a federal level there's been a lot of discussion about the role of factions in the ALP and the suggestion has been that Prime Minister Kevin Rudd has been granted a kind of moral authority to impose his will on the factions because of his election victory and so on. You're actually in a very similar position in W.A., aren't you?, and you're doing similar things: you're over-riding the factions in preselections and so on.

Alan Carpenter: To some extent... Although it would be dishonest of me to say I didn't get co-operation from most of the big factions. Look, what's happened here in Western Australia... When I became Premier it soon became apparent that I had some very deep, in fact enormous problems on my hands with the influence of people like Brian Burke, Julian Grill and others, Kevin Reynolds (through the CFMEU), in the Labor Party. Now, I mean I have absolutely nothing against those people personally - in fact, I've always had a good relationship with Kevin Reynolds. And there are other people, very significant factional players in Western Australian politics and some of their activities made their way on to the national political canvas to our detriment here in Western Australia, I believe. I had to deal with these people, I had to deal with them and I had to make sure that I was ruthless in trying to eliminate the negative impact that they were having on the Labor Party in Western Australia and on government. And there are a string of other people whose names would not be so familiar to a national audience in the same category.

Peter Mares: But you're dealing with this by getting mates of Alan Carpenter into preselection... I mean, former Channel 7 journalist Reece Whitby, I think probably one of the most well-known journalists in W.A., for example...

Alan Carpenter: Yes. But Reece isn't what you'd call a mate of mine. I mean, he was contemporary in journalism - I don't think I ever worked in the same place as Reece. But I just want to take this...

Peter Mares: Your former Chief of Staff though, she's another...

Alan Carpenter: Rita Saffioti. But look, I'll get to this point here. So what I had to do was marginalise, I can't eliminate those characters I talked about before, their influence, but I've pushed it right back. And then I had to make sure that in the next government, if we were to get into government, I had a raft of new people, a team of new people, who could come in and make a good contribution to public life in this State. The other fact that bore down on this course of action was that people like myself and some of the most senior ministers in the current government are not going to be around forever and I had to think of who's going to take the party forward and who's going to take government and public life, if you like, forward in Western Australia. And I had to go out and find some people and approach them and ask them if they'd be prepared to come into the party and the parliament if we could get them elected. That's exactly what the Labor Party did to me when I was a journalist working in Perth. I wasn't a member of the Labor Party: I was approached by the then state secretary, Mark Nolan, on behalf of the then leader, Jim McGinty, because they were looking for new talent.

Peter Mares: So, this suggests that the Labor Party can't produce recruits internally: the factional system is so bad, the internal workings of the party are so bad with branch stacking and so on, that Labor can't produce recruits from within its own ranks...

Alan Carpenter: No. I'm not suggesting that at all. In fact, what we've got here in the situation we're now in Western Australia, I think is a very good mix of some extremely talented people who've come through what we'd call the normal party system supported in many cases - but not always - by factional base, people like, there's a woman called Janine Freeman who is from the Miscellaneous Workers Union supported by the left faction, she will be absolutely outstanding if we can get her into the parliament. There's a man called Roger Cook, similarly talented; Anne Wood, a young lawyer; Chris Tallentire, who was in the Conservation Council over here; Bill Johnson, the current state secretary is a candidate; Andrew Waddell... I supported all of them. In fact, I spoke to some of them probably simultaneously to the factions and also recruited people like you've mentioned, Reece Whitby, Rita Saffioti, who was my chief of staff, former Treasury economist - a brilliant young woman. Karen Brown, another former journalist, another extremely talented young woman and so on. Because I wanted to get talented, young people and I wanted to augment the effort that the factions were putting in themselves. And I think we've got at least a dozen, probably, or more, very talented candidates and potential members of parliament, who one day - and it may not be too far away - will be able, when required, to step up to the plate and become ministers, and senior ministers, and do the job well. Now, I thought that was part of my responsibility as a leader and I had to undertake that responsibility and I did it.

Peter Mares: Alan Carpenter, thanks for your time, and we look to hearing the announcement of an election in due course.

Alan Carpenter: I'll let you know, Peter. Thank you, and I appreciate the time.

Peter Mares: Alan Carpenter is the Premier of Western Australia and he was speaking to me from Perth.

Guests

Alan Carpenter
Premier of Western Australia

Further Information

WA Department of Premier and Cabinet

Presenter

Peter Mares

Producer

James Panichi

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