Where is Our Dam?

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The people of Central Queensland deserve clear answers, not continuous delays, when it comes to the Paradise Dam new wall project. The last public update on foundation geological mapping was in late 2024 and it’s time to find out what actual progress has been made.

Mr Darrough from the National Water Gridadmitted that the detailed business case was finalised in July 2025 and evaluated by Infrastructure Australia in September 2025. And here we are in 2026 and still a formal proposal for the revised dam wall hasn’t been submitted.

The estimated cost has skyrocketed to a staggering $4.4 billion because they realised the old wall couldn’t be reinstated, and they would have to build a new one downstream.

The federal government has committed $600 million (with $50 million already spent on early works), and the rest is just sitting in the budget.

The federal department is just sitting on its hands waiting on the Queensland state government to get its act together and put forward a formal funding proposal.

Meanwhile, Queenslanders wait for water security.

— February | Senate Estimates

Transcript

Senator ROBERTS: Thank you all for appearing again today. I have some brief questions about water infrastructure. I’m told this needs to be asked here. Is anyone familiar with Paradise Dam?

Senator Watt: Oh yes!

Senator ROBERTS: It’s about the new dam wall for Paradise Dam. The last update we can find on this project is the conduct of foundation geological mapping conducted by Sunwater in November 2024. Has anything progressed beyond that and, if so, what?

Senator Watt: While the officials are getting ready, I’ll say that this is a Queensland government project. There will be a limit to the role that this department has in that project, but obviously the officials can share whatever they have.

Mr Darrough: The detailed business case was finalised in July 2025 and is being considered by the Queensland government. The Queensland government hasn’t submitted a proposal for the new project with the revised dam wall arrangements. Infrastructure Australia published its evaluation of the detailed business case in September 2025.

Senator ROBERTS: Who’s funding the new dam wall and in what proportions?

Mr Darrough: The Australian government made a commitment of $600 million; $50 million of that is contracted with Queensland to deliver early enabling works and the detailed business case, and the balance of the funding remains available in the budget.

Senator ROBERTS: What do you expect the total cost to be? How much will the Queensland government pay?

Mr Darrough: I think it’s on the record that it’s an estimated $4.4 billion.

Senator ROBERTS: So the vast majority will come from the Queensland government?

Mr Darrough: The Queensland government hasn’t put forward a proposal to the Australian government for funding.

Senator Watt: In case you’re unaware, Senator, the commitment that our government made of $600 million was 50 per cent of the funding for—was it going to be a new dam originally?

Mr Darrough: It was originally to reinstate the old dam wall, but, when the early work was done on that, Sunwater realised that it couldn’t be restored and that they needed to do a new dam wall downstream, so the price has been revisited. That’s also some time ago, so the estimates have gone up through escalation factors in any case.

Senator ROBERTS: So you’re waiting on the Queensland government to get the total cost?

Mr Darrough: Yes.

Senator ROBERTS: Is there any formula for funding of that from federal compared to state?

Mr Darrough: No. The National Water Grid Infrastructure Investment Framework puts in place arrangements whereby states and territories can ask for up to 50 per cent of funding for capital and construction projects, but there is no formulaic base. The level of contribution that the Australian government would make is a matter that’s decided by the government, and it’s informed by the business case evaluation from Infrastructure Australia, the proposal from Queensland and advice from the department.

Senator ROBERTS: So, in summary, you’re waiting on the Queensland government.

Mr Darrough: Yes.

Senator ROBERTS: Let’s move on to Urannah Dam. It was cancelled by the Albanese Labor government in 2022, I understand. We have the preliminary business case, which was released. I don’t have the final business case and environmental impact study, which I’m assuming showed why the project was not feasible. Were these completed?

Mr Darrough: On Urannah Dam, the then Australian government committed $22.65 million to support the business case, environmental approvals and geotech. On 16 December 2022, the delivery agent, Bowen River Utilities, announced it had withdrawn the scheme from environmental assessment processes in Queensland.

Senator ROBERTS: Was any reason given?

Mr Darrough: I’d need to take that on notice. The funding that was actually in the budget for construction of Urannah Dam was within the infrastructure portfolio, not the water elements that transferred to DCCEEW.

Senator ROBERTS: In whose hands is the final business case?

Mr Darrough: I’ll need to take that on notice.

Senator ROBERTS: And also the environmental impact study?

Mr Darrough: Again, I’ll take that on notice. We encourage jurisdictions to publish business cases that the Australian government contributes to, but, ultimately, the Commonwealth-state relations and the funding arrangement that we have puts ownership of those documents in the hands of the jurisdiction. It’s ultimately a matter for them to decide whether or not they publish.

Senator ROBERTS: That’s the state?

Mr Darrough: Yes, but we encourage in all cases that it be published.

Senator ROBERTS: If you have access to it, may we have a copy, please?

Mr Darrough: I’ll need to take it on notice.

Senator ROBERTS: Yes, that’s fine. If the business case says there’s not enough use for the water, then are you aware that there’s a Project Iron Boomerang or, actually, Capricorn Steel, which is a large project—I won’t go into the details—that would involve putting a steel mill at Collinsville?

Mr Darrough: I can talk more broadly about the Burdekin Basin, of which the Urannah area is part. The Commonwealth is partnering with Queensland on the Burdekin Regional Water Assessment, and that process is under way, looking at a basin-wide assessment of demand and supply for water in the catchment.

Senator ROBERTS: I don’t expect you to know this, but I’ll ask it anyway. Are you aware of the potential for a steel mill at Collinsville and other steel mills in Central Queensland? Mr Darrough: Only from newspapers.

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Why QLD Projects Are Going Nowhere

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I wanted a clear update on major projects vital to Queenslanders. As usual, we are seeing a lot of bureaucratic foot-dragging.

First up, I called out the very slow pace on the M1. The Infrastructure Priority List shows we are still stuck at Stage 2 and 3 of the framework, waiting on the Queensland State Government to get its act together on a business case. While a tiny 10-kilometre section was upgraded, the M1 is 80 kilometres long. When I pushed for a timeline on the rest of the highway, the department couldn’t give me a straight answer on the spot and took it on notice.

It was a similar story with the Centenary Highway. Whilst the new bridge in western Brisbane is welcome, the highway is 42 kilometres long. I asked the exact same question: when will the rest of the widening actually happen? The department’s answer? We’re still in the “business case stage.”

We then discussed the Paradise Dam. We support rebuilding the dam wall, however the numbers must make sense. When I asked about the timeline and cooperation from the Crisafulli Government, the department shirked responsibility and passed the buck, claiming it falls under the Department of Climate Change (DCCEEW), not land transport.

The Queensland Inland Freight Route (Mungindi to Charters Towers) is a brilliant project that One Nation has been pushing for a long time. It links vital regional networks from Roma to Longreach and up to Townsville. I wanted to know why it has stalled and when the Minister will use some real leadership to get it moving. The department clarified it’s a road upgrade, not rail, and provided an update on early works, including pavement widening and bridge upgrades on the Carnarvon Highway and Gregory Developmental Road. It’s a massive multi-year project, and it needs to be finished.

Lastly, I wanted to know why the Port of Gladstone land and sea access upgrade has been stuck as an “identified problem” since 2015 with zero progress. I asked if they were considering the major I-PG Global container facility proposal, however the officials could not answer, instead directing me to Infrastructure Australia who handles those assessments.

— February | Senate Estimates

Transcript

CHAIR: Thank you, Senator Canavan. Senator Roberts.

Senator ROBERTS: I’d like an update on the infrastructure plan for the country. My first question is this. Referencing the infrastructure priority list dated 6 February 2026 on the Brisbane to Gold Coast highway it says the next step is: Proponent to develop potential investment options (Stage 2 of Infrastructure Australia’s Assessment Framework), and complete business case development (Stage 3 of the Framework). The proponent is the Queensland state government; is that correct?

Mr Bourne: Yes.

Ms Hall: If that’s what’s on the infrastructure priority list, yes, that would be correct.

Senator ROBERTS: I note that a 10-kilometre section of the highway was upgraded, yet the M1 is 80 kilometres long. When will we see progress on upgrading the rest of the M1?

Ms Hall: We can take you through what programs we have on the M1 currently, but any additional requests for funding would have to come from the Queensland government.

Mr Bourne: Would you like us to go through our projects along the M1?

Senator ROBERTS: Yes, please. Or could you put it on notice, maybe? I’ve got a few other questions. Are they all short answers?

Mr Bourne: There’s quite a bit to them. We can take that on notice if that’s how you’d prefer to do it.

Senator ROBERTS: Thank you. The centenary highway is the next project. The new bridge is welcome, so thank you for that. People in western Brisbane appreciate it. However, the centenary highway is 42 kilometres long, and, on the plans to widen the motorway, let’s talk about what to do next. It’s the same question. When will we see the rest of the widening occur on the centenary highway?

Mr Bourne: Currently, we have a project called the Centenary Motorway upgrade, and that is a business case that is currently underway. That will be subject to the outcomes of that business case.

Senator ROBERTS: So we’re at the business case stage?

Mr Bourne: Yes, if we’re referring to the Centenary Motorway upgrade.

Senator ROBERTS: The next one is Paradise Dam. We don’t disagree with the decision taken to rebuild the wall—let me make that clear. My question, though, is straightforward. Construction on the replacement dam wall was listed at a cost of $4.1 billion. However, the project is still awaiting a business case. What stage is this project at? When is construction likely to start? And what is the level of cooperation from the Crisafulli government to start the rebuild?

Mr Betts: That would be a matter for the Department of Climate Change, Energy, the Environment and Water.

Senator ROBERTS: The department of climate change?

Mr Betts: Yes, DCCEEW.

Senator ROBERTS: So it’s under their purview, not yours?

Mr Betts: Correct. We are responsible for land transport infrastructure.

Senator ROBERTS: We’re excited about this next one. The Queensland inland freight route capacity and safety proposal is to bring Inland Rail over the border at Mungindi and then take it due north to Charters Towers. This would link in with the Brisbane line and the Toowoomba airport from Roma, the existing line to Longreach, the Port of Gladstone with a small missing link across to the Gladstone heavy rail network and to Mount Isa and Townsville along the existing MITEZ route. This is the right alignment for Inland Rail. At last, we’re seeing progress. This proposal appears to have stalled, though, waiting on the Crisafulli government to do something. At what point, Minister, do you use your power to just get these brilliant infrastructure projects moving? We’re delighted to hear of these projects.

Senator Chisholm: Can the department provide any update on where that is at?

Mr Bourne: Senator, if you’re referring to the inland freight route upgrade—because I think you also mentioned the Inland Rail as well—

Senator ROBERTS: The inland freight route capacity and safety—going from Mungindi to Charters Towers.

Mr Bourne: Yes.

Senator ROBERTS: We love the idea! It’s something we’ve been pushing for a while.

Ms Hall: That’s a road upgrade, not a rail upgrade. We can take you through the inland freight route upgrade.

Senator ROBERTS: Yes, if you could, please.

Mr Brummitt: There’s an early works package that’s continuing at the Carnarvon Highway between Injune and Rolleston, the Dawson River Bridge and Gregory Developmental Road, and pavement strengthening and widening of various sections as well. Then, also on the Carnarvon Highway, the Baffle Creek bridge upgrade is proceeding, and the Gregory Developmental Road pavement strengthening and widening in a number of sections there is under construction, as well as a number of major culvert upgrades. The inland freight route is obviously a very large multi-year project.

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The Broken Promise of Inland Rail

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In this session with the Australian Rail Track Corporation (ARTC), I asked questions on the Border-to-Gowrie section of the Inland Rail, a project that continues to look like a horrendous waste of taxpayers’ money.

I asked how much hard-earned taxpayer money has been spent on this 217-kilometre stretch to date and what it will cost before construction even starts. This question was taken on notice. Estimates have been submitted to the federal government, yet the actual cost of building 37 bridges and 3,000 culverts remains up in the air.

We were originally promised a “port-to-port” network from Melbourne to Brisbane. Now, the ARTC admits the actual scope only goes from Beveridge to Kagaru. They’re admitting they cannot get double-stacked, 1.8-kilometre trains into the Brisbane port — and never will. Moving the intermodal terminal to Ebenezer is a flat-out confession of that failure.

They’re stubbornly sticking to a route that goes over a mountain and straight across the Condamine flood plain, which is an engineering nightmare that we’ve warned them about for years. They’re even talking about a “vast new rail tunnel” down the range before they’ve even sorted the basic costs or engineering reality.

I put it to them directly: every single cent being spent on this Queensland route is completely wasted. If you can’t get double-stacked freight to the port, the entire business case goes completely out the window.

While I know the ARTC is just “following orders,” I urge the government to stop throwing good money after bad.

Although they need to finish costing that range tunnel, they must immediately halt the rest and look at alternative routes, such as taking the alignment to the Port of Gladstone, which would actually deliver real logistical and economic benefits for the entire nation.

Once again – this was taken “on notice.”

— February | Senate Estimates

Transcript

CHAIR: Senator Roberts.

Senator ROBERTS: Thank you for appearing tonight, and have a good evening. My questions are on Inland Rail from the Queensland border to Gowrie specifically. This stage is at phase 4 approval. For 2026, ARTC anticipates increased activity, with teams conducting more site investigations, surveys and updates as they work towards securing final environmental approvals. How much money has been spent on the border-to-Gowrie section to date, and how much is expected to be spent before the first construction begins?

Mr Zambelli: I’d have to take that historical data on notice. At the moment we do have a design team engaged—that’s working on that border-to-Gowrie section to get the next refinement of the design—and we’re out there doing site investigations. I’d have to take on notice the total amount that we’ve spent over many years.

Senator ROBERTS: I can understand that—and also the cost of the design.

Mr Zambelli: Yes.

Senator ROBERTS: It appears you’re persevering with a route over a mountain and across the Condamine flood plain, which we’ve talked about many times, to get down to the Brisbane rail network, which will never be able to handle 1.8-kilometre trains or double-stacked trains—never. Why are you persevering with a route that will never get you to port, instead of taking the Inland Rail alignment to the port of Gladstone? There are many logistical benefits for the whole nation.

Mr Zambelli: The scope of Inland Rail is to go to Kagaru, not to Brisbane port, with double-stacked trains to Ebenezer and single-stacked trains to Kagaru. That is the scope. Inland Rail does not go to Brisbane port.

Senator ROBERTS: No, I understand that, but we were originally told it was port to port—Melbourne to Brisbane. That’s what we were originally told was the vision for Inland Rail. It’s not going to do it. It can go to the port of Gladstone.

Mr Zambelli: I’m just telling you the scope, Senator. Inland Rail is Beveridge to Kagaru.

Senator ROBERTS: Yes. You’ve got to follow orders. The border-to-Gowrie section is 217 kilometres of mostly new track, 37 bridges and 3,000 culverts. How much will this cost?

Mr Zambelli: The cost of that section is still being determined. We’ve provided some scope and design, schedule and cost estimates to the federal government, and that’s a matter for the federal government and their assurance verification specialist that’s working with them.

Senator ROBERTS: It’s horrendous. There’s Gowrie to Helidon, including a ‘vast new rail tunnel’—they’re Inland Rail’s words. Surely, taking Inland Rail to Toowoomba shouldn’t be considered until you sort the cost and engineering for taking it down the range. I put it to you that every cent you’re spending on the Queensland route is completely wasted. If you can’t get double-stacked freight to Brisbane, the whole business case is out the window, and your recent update about moving the intermodal from Kagaru to Ebenezer acknowledges you can’t get double-stacked trains to Brisbane itself, which you’ve admitted. Would you please continue work on costing the tunnel down the range but otherwise spend your time, Minister, revisiting alternative routes for Inland Rail? There are so many other fine options that will benefit the country.

Senator McCarthy: I’ll take your question on notice, Senator Roberts.

Senator ROBERTS: Thanks, Minister.

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Endless Studies, Zero Dams

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The Urannah Dam project was cancelled by the Albanese Labor government in 2022. I wanted to see the final business case and environmental impact study (EIS) to see what they’re hiding.

The Commonwealth threw $22.65 million into the business case and approvals, then Bowen River Utilities withdrew the scheme from Queensland’s environmental assessment processes in December 2022.

When I asked why it was withdrawn, where the final business case is, and where the EIS is, the department agreed to provide it on notice. They claimed that because of “Commonwealth-state relations,” the ownership of these taxpayer-funded documents rests with the state, though they “encourage” publication. I’ve requested copies if they have access to them.

I asked if the bureaucrats are looking at the bigger picture regarding future water demand in the Burdekin Basin.

There is massive potential in the Great Australian Infrastructure Project, which would see a major steel mill established at Collinsville, along with other mills in Central Queensland. These visionary projects will have a massive appetite for water.

The department representative admitted he only knows about these vital industrial opportunities from reading the newspapers. They did note they are partnering with Queensland on a broader “Burdekin Regional Water Assessment” to look at basin-wide supply and demand, however it’s clear they are disconnected from real-world economic development.

Whether it’s Paradise Dam or Urannah Dam, we are seeing the same pattern: endless assessments, massive cost escalations, secret reports and a total lack of urgency from state and federal governments to actually build the water infrastructure Australia.

Transcript

Senator ROBERTS: Thank you all for appearing again today. I have some brief questions about water infrastructure. I’m told this needs to be asked here. Is anyone familiar with Paradise Dam?  

Senator Watt: Oh yes!  

Senator ROBERTS: It’s about the new dam wall for Paradise Dam. The last update we can find on this project is the conduct of foundation geological mapping conducted by Sunwater in November 2024. Has anything progressed beyond that and, if so, what?  

Senator Watt: While the officials are getting ready, I’ll say that this is a Queensland government project. There will be a limit to the role that this department has in that project, but obviously the officials can share whatever they have.  

Mr Darrough: The detailed business case was finalised in July 2025 and is being considered by the Queensland government. The Queensland government hasn’t submitted a proposal for the new project with the revised dam wall arrangements. Infrastructure Australia published its evaluation of the detailed business case in September 2025.  

Senator ROBERTS: Who’s funding the new dam wall and in what proportions?  

Mr Darrough: The Australian government made a commitment of $600 million; $50 million of that is contracted with Queensland to deliver early enabling works and the detailed business case, and the balance of the funding remains available in the budget.  

Senator ROBERTS: What do you expect the total cost to be? How much will the Queensland government pay?  

Mr Darrough: I think it’s on the record that it’s an estimated $4.4 billion.  

Senator ROBERTS: So the vast majority will come from the Queensland government?  

Mr Darrough: The Queensland government hasn’t put forward a proposal to the Australian government for funding.  

Senator Watt: In case you’re unaware, Senator, the commitment that our government made of $600 million was 50 per cent of the funding for—was it going to be a new dam originally? 

Mr Darrough: It was originally to reinstate the old dam wall, but, when the early work was done on that, Sunwater realised that it couldn’t be restored and that they needed to do a new dam wall downstream, so the price has been revisited. That’s also some time ago, so the estimates have gone up through escalation factors in any case.  

Senator ROBERTS: So you’re waiting on the Queensland government to get the total cost?  

Mr Darrough: Yes.  

Senator ROBERTS: Is there any formula for funding of that from federal compared to state?  

Mr Darrough: No. The National Water Grid Infrastructure Investment Framework puts in place arrangements whereby states and territories can ask for up to 50 per cent of funding for capital and construction projects, but there is no formulaic base. The level of contribution that the Australian government would make is a matter that’s decided by the government, and it’s informed by the business case evaluation from Infrastructure Australia, the proposal from Queensland and advice from the department.  

Senator ROBERTS: So, in summary, you’re waiting on the Queensland government.  

Mr Darrough: Yes.  

Senator ROBERTS: Let’s move on to Urannah Dam. It was cancelled by the Albanese Labor government in 2022, I understand. We have the preliminary business case, which was released. I don’t have the final business case and environmental impact study, which I’m assuming showed why the project was not feasible. Were these completed?  

Mr Darrough: On Urannah Dam, the then Australian government committed $22.65 million to support the business case, environmental approvals and geotech. On 16 December 2022, the delivery agent, Bowen River Utilities, announced it had withdrawn the scheme from environmental assessment processes in Queensland.  

Senator ROBERTS: Was any reason given?  

Mr Darrough: I’d need to take that on notice. The funding that was actually in the budget for construction of Urannah Dam was within the infrastructure portfolio, not the water elements that transferred to DCCEEW.  

Senator ROBERTS: In whose hands is the final business case?  

Mr Darrough: I’ll need to take that on notice.  

Senator ROBERTS: And also the environmental impact study?  

Mr Darrough: Again, I’ll take that on notice. We encourage jurisdictions to publish business cases that the Australian government contributes to, but, ultimately, the Commonwealth-state relations and the funding arrangement that we have puts ownership of those documents in the hands of the jurisdiction. It’s ultimately a matter for them to decide whether or not they publish.  

Senator ROBERTS: That’s the state?  

Mr Darrough: Yes, but we encourage in all cases that it be published.  

Senator ROBERTS: If you have access to it, may we have a copy, please?  

Mr Darrough: I’ll need to take it on notice.  

Senator ROBERTS: Yes, that’s fine. If the business case says there’s not enough use for the water, then are you aware that there’s a Project Iron Boomerang or, actually, Capricorn Steel, which is a large project—I won’t go into the details—that would involve putting a steel mill at Collinsville?  

Mr Darrough: I can talk more broadly about the Burdekin Basin, of which the Urannah area is part. The Commonwealth is partnering with Queensland on the Burdekin Regional Water Assessment, and that process is under way, looking at a basin-wide assessment of demand and supply for water in the catchment.  

Senator ROBERTS: I don’t expect you to know this, but I’ll ask it anyway. Are you aware of the potential for a steel mill at Collinsville and other steel mills in Central Queensland?  

Mr Darrough: Only from newspapers.  

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Who’s Winning the Tobacco War?

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Black market tobacco and vaping in Australia is a real problem. I raised concerns that, while seizures have increased by 38%, there’s no clear data showing whether that’s actually making a dent in the total illicit market.

Even the department couldn’t tell me how much illegal tobacco is getting through compared to what’s being stopped. They admitted that assessment is still pending in a report from the Illicit Tobacco and E‑cigarette
Commissioner.

I asked for clarity on illegal vape consumption, noting that import figures alone don’t tell the story, especially when some products are being made domestically. Again, the answer was that they don’t know how many illegal vapes are actually being used across the country, only how many have been intercepted at the border.

I raised serious concerns about the criminal activity tied to this black market — violence, intimidation and organised crime. Yet no-one present could provide figures on how many violent incidents are linked to illegal tobacco and vaping. I was told that that information sits with law enforcement agencies, not the commissioner.

On the financial side, I asked how much revenue Australians are losing due to illegal tobacco. While officials highlighted that billions in evasion have been prevented through seizures, they still couldn’t provide a clear figure for total revenue lost. I pointed out that estimates suggest the cost could be as high as $8–9 billion annually, which underscores just how massive this black market has become.

What we’re dealing with here is a large, organised criminal enterprise, often driven from overseas, and that we need proper data on the size of the market and the broader social costs. Without that, we’re flying blind.

Finally, I asked Minister Watt directly on whether its excessively high tobacco taxes are driving ordinary Australians into the illegal market by making legal products unaffordable.

True to form, Minister Watt flatly rejected that connection, yet offered no evidence to support that position. I pointed out to him that this approach risks empowering organised crime while reducing government revenue, placing greater burdens on taxpayers.

Transcript

Senator ROBERTS: Mr Reynolds, a constituent says: ‘If the seizures have increased by 38 per cent, what has been the proportion of the total growth in the illicit tobacco market? Has it grown by more than 38 per cent? How do we know that?’ Compliments to you for the seizure, but how do we know if that has had a big impact?

Mr Reynolds: It’s a reasonable assessment that there has been an increase in the amount of illicit tobacco coming into the country. But I’m not in a position to tell you what the delta is. The amount that we get on the
border to the amount that is coming into the country is not a figure that I have for you.

Senator ROBERTS: You don’t have it?

Mr Reynolds: What I’d offer is this: the Illicit Tobacco and E-cigarette Commissioner is working through an assessment of what that delta is, and that will be provided in a report to the government.

Senator ROBERTS: Commissioner, when do we expect that report?

Ms Foster: The commissioner gave evidence earlier that she was just finalising the report at that moment.

Senator ROBERTS: So we should see that soon? Will that report contain an assessment or an estimate of the total illicit tobacco market size?

Ms Shuhyta: It will.

Senator ROBERTS: Thank you. That’s good. How many illegal vapes were consumed in Australia in the last 12 months? I say ‘consumed’ because I understand some are being made here. Importation figures are less relevant than they are for tobacco; is that correct?

Mr Reynolds: I can tell you we allowed 1.2 million legal vapes into Australia and we intercepted six million illegal vapes on the border coming into the country. But I’m not in a position to tell you how many illegal vapes were consumed in Australia during the financial year.

Senator ROBERTS: Thank you. How many acts of violence were committed in Australia that were directly related to illegal tobacco and vapes? I’m talking about murders, fire bombings, assaults and similar acts or threats of violence. We know from tobacconists that they’ve been threatened. Some have been shut down.

Mr Reynolds: I think that’s really a question for, potentially, the Australian Federal Police—or the Australian Criminal Intelligence Commission may have an answer to that question for you.

Senator ROBERTS: Is there someone from the AFP who could answer that—or perhaps the commissioner could.

Ms Foster: The AFP is appearing later this evening.

Senator ROBERTS: Thank you. Does the commissioner have any idea of that? You’re in charge of coordinating stopping this.

Ms Shuhyta: I don’t have the exact numbers in front of me, no.

Senator ROBERTS: Are you able to get them on notice?

Ms Shuhyta: I will do my best to work with law enforcement.

Ms Foster: I think the question is best directed to the law enforcement agencies rather than the ITEC commissioner. They will be here later.

Senator ROBERTS: Isn’t the ITEC commissioner overseeing and coordinating everything?

Ms Foster: She’s coordinating the response, but, where there is a specific function like law enforcement, those questions are best directed to the specific agency.

Senator ROBERTS: Commissioner, how much government revenue has illegal tobacco taken out of the budget?

Mr Reynolds: I don’t have that figure. That may be an inclusion in the ITEC commissioner’s report to the government. What I can tell you is that we have prevented $4.4 billion worth of evasion by intercepting 2.5
billion cigarettes and over 400 tonnes of loose tobacco on the border.

Senator ROBERTS: Thank you for that. Those figures and the number of cigarette sticks you’ve intercepted are pretty impressive, but my understanding is that the government has lost about $8 billion or $9 billion a year on excise due to illegal tobacco coming into the country. We need to understand the size of the overall market, because it’s huge. We also have to understand the costs of the crimes being committed. We’ve got criminal gangs working from overseas, as I’m sure you’re aware, who are taking over tobacco trade in this country.

Mr Reynolds: Indeed. The ITEC commissioner has already given evidence that that report will be provided to government; that’s yet to be forthcoming.

Senator ROBERTS: I must compliment you on your evidence; you’re very direct, which is good. Minister, do you consider the government’s very high tobacco duty is the reason otherwise law-abiding citizens are prepared to buy illegal tobacco for generally a third of the legal price?

Senator Watt: No.

Senator ROBERTS: Any reasons?

Senator Watt: There’s absolutely no evidence to suggest that argument.

Senator ROBERTS: You’re joking?

Senator Watt: No.

Senator ROBERTS: Minister, is this office designed to make it look like you’re doing something to solve a problem your greedy tax grab created—and your predecessor’s?

Senator Watt: No.

Senator ROBERTS: No data, just meetings—empowering organised crime, decreasing revenue that taxpayers have to make up, and you just say ‘no’.

Senator Watt: You asked me a question, and I said ‘no’.

Senator ROBERTS: I’m asking you: are you ignoring the data to just put in meetings, empowering organised crime and decreasing the revenue to the government?

Senator Watt: No.

Senator ROBERTS: Thank you very much.

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Government Gambles With Your Money

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I wanted to get some straight answers about the government’s 5% deposit scheme, because to me, it looks like risky lending at the taxpayers’ expense.

APRA have previously said that loans with a 95% value ratio are high-risk. I asked how they reconcile that with a government scheme that encourages this exact behaviour. They admitted that high-ratio lending is “more risky” and they are watching it closely.

I’m worried about what happens if property prices drop by 10 or 20%. If people fall into negative equity, the taxpayer is underwriting a huge chunk of those losses. APRA ducked out of giving a specific answer on the scheme itself, however insisted their “stress tests” for the overall banking system are even more severe than the scenarios raised.

I asked: was the Treasurer warned about the scheme’s risks? They told me they gave some advice to Treasury early on about mortgage insurers, but nothing specifically to the Treasurer. They will provide me with a copy of that advice on notice.

I questioned APRA as to whether this scheme follows their own sound risk management standards. They replied that they don’t “opine” on government policy, however confirmed that they’ll expect banks to hold the same amount of capital against these loans as any other high-risk product.

Finally, I asked if they would publish stress test results specifically for this 5% scheme. They stated that their stress tests are “much broader than any one government policy” and that they are “not aware of a stress test” planned for this specific scheme.

APRA knows these loans are risky and are tiptoeing around the topic.

Transcript

Senator ROBERTS: Thank you for being here. APRA has previously stated that loans with loan-to value ratios above 90 per cent ‘clearly expose an ADI to a higher risk of loss’ and that prudent loan-to-value ratio limits are essential for portfolio risk management. How does APRA reconcile those warnings with the government’s five per cent deposit scheme, which institutionalises 95 per cent loan-to-value ratio lending, backed by taxpayers?  

Mr Lonsdale: Well, it’s something that we’re watching very closely, Senator. I think the premises of your question is correct: high LVR lending, as a general statement, and high debt-to-income lending are at the more risky end. Because of that, we watch that type of lending very closely.  

Senator ROBERTS: Has APRA provided advice to government on the systemic risk and implications of guaranteeing high loan-to-value ratio loans under this scheme? If so, will you table that advice? 

Mr Lonsdale: As I mentioned to Senator Brag, we were asked for our advice on LMI providers for the early design of the scheme, which we provided to Treasury, not the Treasurer. But we’ve not provided any advice to the Treasurer on the systemic effects of the Home Guarantee Scheme as currently implemented.  

Senator ROBERTS: Could we get a copy of that advice that you gave to Treasury, on notice?  

Mr Lonsdale: I’m happy to take it on notice.  

Senator ROBERTS: Borrowers with 95 per cent loan-to-value ratio loans are more likely to fall into negative equity during downturns, and taxpayers are underwriting 15 per cent of these loans. Has APRA modelled fiscal exposure if property prices fall by, say, 10 to 20 per cent?  

Mr Lonsdale: We do very stringent stress tests on the banks and on the system that are more stringent than you just outlined there.  

Senator ROBERTS: So you’ve done what I’ve said?  

Mr Lonsdale: More stringent, I would say, and we publish those results. The outcome is that our banking system, particularly our major banks, are very resilient.  

Senator ROBERTS: Does APRA consider the scheme consistent with Prudential Standard APS 220 and APG 223, guidance of sound risk management?  

Mr Lonsdale: I don’t want to comment directly on the scheme, but what I can say is that that’s a very important standard that you mentioned, and we deal with the banks all the time to make sure that they are resilient and are adhering to our standards, of which that is one.  

Senator ROBERTS: Why can’t you discuss the scheme in relation to that?  

Mr Lonsdale: As I said to Senator Bragg, if we’re looking at the scheme, we want to have a look very closely at the empirics, the loans being used—  

Senator ROBERTS: Once you’ve got experience.  

Mr Lonsdale: After we’ve got experience. We like to base our conclusions on facts.  

Ms McCarthy Hockey: Government schemes at federal level and state level come and go from time to time. We see different structures of ways in which government make their decisions and put in place policies. At all points in time, it is for the bank to determine its risk appetite for the kind of lending that it would extend and then that it adequately capitalises that and puts liquidity against it. So, I think the really key point here is that we don’t opine on any regime put forward by a government. It is their prerogative. However, the banks are to uphold the lending standards and the risk management, and to capitalise it and put liquidity accordingly. What we then do is look at the macroprudential picture that we monitor—you can see us very regularly publishing our view of that— and take our macroprudential measures accordingly, which are within our gift to do. There are different roles that we play, but the key thing is that banks are managing that risk, we are managing the system risk, and governments will make their decisions as they see fit.  

Senator ROBERTS: APRA’s guidance emphasises limiting large volumes of high-risk lending. Does APRA classify the government’s scheme as high-risk lending?  

Mr Lonsdale: Again, I don’t want to comment directly on the scheme, but I’ll make this general point: the higher the LVR, generally, the higher the risk involved, and the higher the probability of default. I think that is true. Because we’ve had a large number of questions on high-LVR lending, can I just make this point: it is part of our normal course that we would seek reporting from the banks on high-LVR lending; because it is high-risk lending, we do that. The other thing that I think is a very important point is that when you look at the capital settings that we apply, the vast bulk of lending that is happening in the country—but also that we’d expect under this scheme—is done by the major banks, the lion’s share. The capital that we are requiring to be held is agnostic to the Home Guarantee Scheme. So, regardless of that guarantee, we are requiring the same amount of capital to be held. 

Senator ROBERTS: So that means that APRA will apply the same supervisory expectations to banks originating these loans as it does to other high loan-to-value ratio products? 

Mr Lonsdale: Yes, we will. 

CHAIR: How are you going, Senator Roberts? 

Senator ROBERTS: Almost. Will APRA commit to publishing stress test results for the five per cent deposit scheme under scenarios of price declines and unemployment shocks? 

Mr Lonsdale: The stress tests that we do are much broader than any one government policy, and we do publish those. I’m not aware of a stress test that we will be doing on the particular scheme. 

Senator ROBERTS: Thank you for your succinct answers. Thanks, Chair. 

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Government Spending is Fuelling the Fire

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There is a massive disconnect between the RBA’s projections and the reality facing Australian families.

Reckless government spending is fuelling inflation, and everyday people are paying the price.

In this session with the RBA in December, I questioned Governor Bullock on her claim that inflation expectations are ‘anchored’ at 2.5%. With CPI at the time sitting at 3.8% (now 4.2%), that ‘anchor’ looks like it’s dragging. I asked her who has lost credibility here — the RBA or the government?

There’s a real risk of cutting rates too early because of political influence and outside pressure. While Ms. Bullock insists the Board isn’t being swayed by politics, I’m still sceptical about what really happens behind the scenes.

One of the biggest risks I raised was the threat of a federal credit rating downgrade. If the government can’t show budget discipline and we lose our AAA rating, bank borrowing costs will shoot up.

And if that happens, mortgage rates will go up, even if the RBA doesn’t touch the cash rate and that’s a rate hike due to government incompetence.

Finally, we touched on the data. I pointed out how absurd it is that the ABS classifies someone as ’employed’ if they work just one hour a week.

While the Governor appears to trust the official statistics, these numbers are masking the true level of underemployment. There are far more Australians struggling to find work than the headline figures suggest.

Transcript

Senator ROBERTS: I’m concerned about government spending, but I’ll ask a few questions before getting on to that directly. In October, you said to me that ‘all the evidence we have is that inflationary expectations have remained reasonably anchored at around 2.5 per cent’. I know you went to this with Senator Hume’s question, and you continued that’s ‘what has made it possible, I think, to bring inflation back down toward the target range so that we’re now under three per cent and heading towards 2.5 per cent and to maintain a relatively healthy labour market’. You couldn’t achieve that without anchored inflation expectations. With the Consumer Price Index headline rate now at 3.8 per cent in the year to October and the trimmed mean up 3.3 per cent, it certainly doesn’t appear that we’re heading to 2.5 per cent anymore. Do you still have no evidence that inflation expectations are above 2.5 per cent?  

Ms Bullock: What we’ve observed is what we usually observe, that the very short-term inflation expectations rise, but at the moment we’re still seeing that the longer term inflation expectations are remaining reasonably anchored. But you raise a very relevant point. It’s a risk and it’s something the board is very focused on. 

Senator ROBERTS: What does it say about the credibility of the Reserve Bank or, more likely, the credibility of government in terms of government spending if inflation rears its head again?  

Ms Bullock: I think credibility is demonstrated by where inflation expectations are. Inflation expectations in the long term remain anchored, which I think says a lot about the credibility of the central bank.  

Senator ROBERTS: In 2026, are more families going to be pushed to the brink and paying more on their mortgages because you cut interest rates too early while this government attempted to jawbone and pressure you into doing it?  

Ms Bullock: We’ve never been under any political pressure. The board has done what the board has thought was the right thing to do. We thought we were moderately restrictive. We made a conscious decision not to go up as high as some other countries. Our projections still see inflation coming back down, but obviously we’re alert to the possibility that there might be inflation pressures building, and the board will respond accordingly.  

Senator ROBERTS: Do you expect under current government strategies and policies to be having to deal with the government again on this?  

Ms Bullock: We take what the government is doing as a given, and that is in our forecasts. 

Senator ROBERTS: I refer to federal budget discipline, to the credit rating and mortgage rates. The banks are implicitly guaranteed by the government’s AAA credit rating, which allows them to borrow cheaply. If the federal government were to suffer a significant credit rating downgrade below its AAA, could that imply higher borrowing costs on the banks and a wider spread between the going mortgage rate and the Reserve Bank cash rate? In other words, could interest rates charged by the banks rise?  

Ms Bullock: The Australian banks aren’t only underpinned by the government, they’re underpinned by the fact that they are very strong, unquestionably strong according to the language. They have strong capital, strong buffers, low arrears rates. They’re rated well because they are very strong financial institutions.  

Senator ROBERTS: I appreciate your clear answers. Nonetheless, if the federal government doesn’t get its spending under control and is given a lower credit rating, what people pay on a mortgage could actually go up without the Reserve Bank raising rates; is that right?  

Ms Bullock: It could possibly tighten financial conditions. Those are the sorts of things that the Monetary Policy Board would take into account in setting the cash rate. Financial conditions can vary for similar cash rates. The cash rate at a particular level now isn’t necessarily the same tightness in financial conditions as the same cash rate in the past. We have to take into account financial conditions.  

Senator ROBERTS: Just a quick question to tidy up my understanding of where you get your figures. The RBA, as I understand it, does a lot of listening right through the community. That’s correct, isn’t it?  

Ms Bullock: We have a very extensive liaison program, yes.  

Senator ROBERTS: What are the sources of your inflation rate and the unemployment rate? Is it many factors—ABS, for example? Whom else would be involved?  

Ms Bullock: The inflation rate is the CPI published by the Australian Bureau of Statistics. The unemployment rate is the same.  

Senator ROBERTS: The unemployment rate is just over 4.4 per cent. How many people does that translate into being unemployed right now in Australia?  

Ms Bullock: I’d have to get back to you on that in terms of the actual numbers.  

Senator ROBERTS: It’s just a straight calculation, right, arithmetic?  

Ms Bullock: It depends on the labour force and who’s in the market. I don’t know what the number is. I’ll have to come back to you.  

Senator ROBERTS: That varies month to month of course. My concern is that the actual number unemployed may be far greater than what is indicated by the unemployment rate. As I understand it, the definition—and I’m looking for guidance here—is that anyone who’s employed or works paid work for one hour or more in a week is counted as employed?  

Ms Bullock: Correct.  

Senator ROBERTS: Is there any consideration of underemployment in your deliberations?  

Ms Bullock: Yes, we consider underemployment. That’s a rate that we calculate. Basically, that captures people who are employed but would like more hours.  

Senator ROBERTS: What is your level of confidence in the accuracy of the unemployment rate and the underemployment rate?  

Ms Bullock: We’re pretty confident that the ABS does a very good job of calculating these numbers.  

Senator ROBERTS: Is one hour per week employed really employed?  

Ms Bullock: That’s the definition, but there are others. As I said earlier, for what it measures, we’re confident they measure it well. But that’s why we take into account a lot of different indicators, including things like vacancies, job ads and how many people actually have a job but would like more hours. These are all things that we consider as well.  

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Undercutting Aussie Farmers for US Beef

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I asked the department about its decision to allow US beef imports and why so much of the process is hidden behind redactions.

From what I understand, in 2017, the department reviewed biosecurity risks for cattle continuously resident in the applicant country since birth. Then, in 2019, it approved imports of cattle born, raised, and slaughtered in the US. however in 2020, the US asked for something new: permission to export cattle that had been imported from other countries into the US. To justify this, the department commissioned two addendums to the original review.

One addendum was released publicly. The other? Completely hidden.

I asked for its title and a copy. The department refused, saying that I’d have to pursue review options on the FOI. What are they hiding?

Here’s the bigger issue: Australia is extremely efficient at producing beef. The only way US beef becomes cheap enough to compete here is if they import cheaper cattle from countries like Mexico, slaughter them in the US, and then export the meat to Australia. If we only allowed beef born, raised, and slaughtered in the US, they couldn’t compete. Now, by allowing Mexican cattle through the back door, we risk undercutting Australian farmers.

The department insists price isn’t part of their biosecurity assessment and that they only look at disease risk. Yet that’s exactly the problem. We’re ignoring the commercial reality that this opens the door to cheaper imports while relying on foreign assurances for safety.

Strong biosecurity is important, however Australians deserve transparency — not redacted documents and blind trust in foreign systems.

Transcript

ACTING CHAIR: Senator ROBERTS.  

Senator ROBERTS: Thank you for being here again. First of all, I’d like to discuss the decision to allow US beef imports. I’m going to go to freedom of information LEX 34322 for some of this information, which you charged me $600 for and heavily redacted. Thanks for that! I’ll go through my understanding. Pull me up if there needs to be a correction, please. The work the department did in their 2017 review strictly assessed risks from cattle continuously resident in the applicant country since birth. Then a 2019 assessment following on from that review approved the export to Australia of cattle that had been born, raised and slaughtered in the United States. Then, in 2020, the US asked for cattle imported from other countries into the US to be allowed to be imported to Australia via the US. The department then commissioned two addendums to the review. Is that correct?  

Dr Smith: From what I could hear, that sounded correct.  

Senator ROBERTS: Okay. So we have a 2017 review, a 2019 approval for US born cattle, then a 2020 request to allow cattle not born in the US and some additional addendums made to the 2017 review to justify that request. Correct?  

Dr Smith: Yes, the original 2017 review was for a number of applicant countries, not just for the US, but that was specifically born, raised and slaughtered in the US. The addendum was to allow for cattle born and raised in Canada and cattle born and raised in Mexico imported into the US, slaughtered and then brought to Australia.  

Senator ROBERTS: So you made two addendums to the 2017 review. One was called Final report: risk of lumpy skin disease via fresh bovine skeletal muscle meat from applicant countries, but you redacted the name of the second addendum. Why are you hiding it, and what was the second addendum titled?  

Dr Smith: I understand ..that was part of an FOI process and that the decision-maker has recently provided that decision and the reasons for doing so, which you’ve received. I think you’ve also been provided your options for a review, and, if any of those need to be taken further, then you have those avenues to do so.  

Senator ROBERTS: You’re saying not only that I can’t get the list of the second addendum but that I can’t get the whole addendum from you?  

Dr Smith: I wasn’t the decision-maker on that FOI. I can say that there was an addendum which I referred to in relation to the expanded access. We did do some additional work around the safety of LSD, lumpy skin disease, in skeletal muscle as a separate process. That was also released publicly and deemed that LSD can be safely managed in skeletal muscle imports. 

 Senator ROBERTS: What I’m asking for is a copy of the second addendum.  

Dr Smith: As I mentioned before, I wasn’t the decision-maker in that process. If there is a question around what was provided back to you from the decision-maker, who was an officer in the department, then you have the right to review that decision.  

Senator ROBERTS: I have the right as a senator to get a document that I request in Senate estimates.  

Ms Saunders: We’ll take that on notice. We don’t have the documents available at this point in time. We’ll have to consider whether we would seek public interest immunity in relation to those documents.  

Senator ROBERTS: I was going to mention that. If you disagree, you’ll have to seek PII.  

Ms Saunders: Indeed.  

Senator ROBERTS: I’m just wondering what you’re keeping from the Senate. The core change, as far as I can see, is that Mexico have said they will certify that Mexican cattle were born and raised in Mexico. That’s to stop, apparently, the risk of cattle being brought up from Central American or South American countries, where lumpy skin or mad cow disease is present, into Mexico and then into the United States and exported to Australia. Mexico is considered some to be a narco-terrorist state. Even if you disagree with that assessment, they clearly have a higher risk of corruption and a financial incentive to lie about these certificates. Why are we changing our entire biosecurity tolerances because of assurances Mexico has given not even to us but to another country? They’ve given those assurances to the United States not to us.  

Dr Smith: There were a couple of processes of assessment. FSANZ, the Food Safety Australia New Zealand, did their own independent assessment of Mexico as a country. They also assessed US as a country and Canada as a country. They assessed that their systems, their controls, the ways they managed the BSE risk, which is the mad cow risk, was at the lowest category—category 1—noting that Mexico’s never had a reported case of BSE and that the last case of FMD in Mexico was in 1952.  

Senator ROBERTS: Who did that assessment of the risk with Mexican imports?  

Dr Smith: That assessment that I referred to was FSANZ, the statutory authority under the department of health. That’s publicly available.  

Senator ROBERTS: We’ve reviewed Mexican beef. What about Central American or South American beef?  

Dr Smith: We reviewed the importation of eligible cattle from Mexican supply chains, subject to the protocols that we strengthened with the USDA, to ensure that those cattle—live cattle, not beef—that were brought into the US supply chain could be traced back to their property of origin and that they were sourced from TB-free and other disease-free herds. They’ve tested as such, noting that, as I said in evidence earlier, 1.2 million cattle legally come into the US, and have done for decades, and then they become integrated as part of the herd. We’ve not seen any outbreaks of disease or issues in human health or, particularly, beef exports from the US that have resulted in disease.  

Senator ROBERTS: So you’re telling me that you have got assurance that cattle from Mexico going to the United States meet your standards. What about cattle that go from South America or Central America into Mexico and then to the United States?  

Dr Smith: We’re not assessing beyond Mexico; we’re only assessing those that have been brought into the US from Mexico. But the FSANZ assessment did look at Mexico as a country in and of itself, and they believed that they had the adequate controls to manage, in this case, the BSE risk. We’ve also done a lot of work with the USDA as well to make sure that they have confidence in the system because they need to protect their domestic herd, which is incredibly important for their own domestic consumption. Noting, too, that we import a lot of genetic material from the US, which relies on the same traceability of straws of semen and embryos into Australia—which we’ve been doing for decades—and we’ve never had any cases of diseases as a result.  

Senator ROBERTS: So you’re relying on the United States to protect itself from South American and Central American beef?  

Dr Smith: We’re relying on the fact that we did a systems audit of the US system, which we’ve relied upon for many years for importation of a number of commodities into Australia, that it has been done safely.  

Senator ROBERTS: We’re very efficient with our beef production in Australia. The only way importing US beef gets cheap enough for them to compete with our growers here, is if they’re allowed to import cheaper cattle from other countries, slaughter them in the United States and export them to Australia. It’s true, isn’t it, that if we only allowed beef born, raised and slaughtered in the US, they just wouldn’t be able to compete—yet now we’re allowing countries like Mexico through the back door to undercut Australian farmers. Is that correct? 

 Dr Smith: I wouldn’t characterise it as that. The cattle that they bring are specific for their needs. They are bringing them into the supply chain mostly as feeder cattle—so steers and spayed heifers—that then get brought into their feedlots. They are fattened up and, essentially, they are then treated as US cattle and they would enter our supply chain for market access to us, subject to the raft of conditions that we put in place. Senator ROBERTS: So you’re confident that Mexican cattle coming into the United States, slaughtered in the United States, is not a way for the Americans to undercut our prices in Australia?  

Dr Smith: Our biosecurity assessment doesn’t look at price or competitiveness per se. I note that the price of US beef is quite high at the moment, I’m aware of that, but that is not part of our considerations as part of a biosecurity assessment. We’re not able to look at price comparators or impacts on domestic industries as part of our SPS agreement under the WTO.  

Senator ROBERTS: I appreciate your direct answers. So we’re potentially exposed to cheaper Mexican cattle coming into the United States and undercutting us in Australia?  

Senator Chisholm: I don’t think that’s accurate.  

Senator ROBERTS: How do you know that’s not correct?  

Senator Chisholm: Because I don’t think you’ve been able to point to evidence that that’s the case.  

Senator ROBERTS: I’m asking if that is a possibility.  

Senator Chisholm: There is no evidence that—  

Senator ROBERTS: What we’re being told is that only the biosecurity risks are taken into consideration.  

Senator Chisholm: I understand that, but there is no evidence that what you’re suggesting is the case.  

Senator ROBERTS: I’m not saying that there is evidence. I want to know—  

Senator Chisholm: Then you shouldn’t put something like that.  

Senator ROBERTS: I’m asking the question if there is a way of doing that.  

Senator Chisholm: There is no evidence to support that.  

Senator ROBERTS: I’m not saying that. I have got the evidence. I’m asking if that’s a way—I have learnt that it is not a consideration; it’s just biosecurity. That is still an open-ended—  

Senator Chisholm: And I’m saying that there is no evidence to support that.  

Senator ROBERTS: We’re just going around the merry-go-round.  

Dr Smith: Senator, maybe I can help. Commercial matters, as far as what consumers will import, are a matter for commercial operators. If there is a viable commercial market that they can bring product in that meets our requirements under biosecurity, then they are able to do so.  

Senator ROBERTS: And if there’s a problem with it, if it’s undercutting Australian beef, then it’s up to our beef growers to draw that to whose attention?  

Dr Smith: Yes; but I think it’s unlikely that that’s going to be the case. 

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Foxes Guarding the Henhouse

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During this Estimates session with the Clean Energy Regulator (CER), I questioned them on the government’s setup with the Clean Energy Council (CEC). The CEC is a private lobby group, yet they appear to act as the “gatekeeper” as to which solar panels can be sold under the renewable energy schemes.

WHY has a private industry group, which exists to advocate for its members’ commercial interests, been given the power to decide which products qualify for government incentives?

I was told the Clean Energy Council (CEC) was originally “named” in the legislation effectively as a co-regulator and have been “tested” against competitors. The Regulator admitted that they worked back-and-forth with the CEC to help their application meet the required standards.

I asked if this process was open and transparent to the public. Their response? Happy to take it on notice and of course, they used the “commercial-in-confidence” excuses.

When questioned on how they manage any bias, the Regulator pointed to “regular cadences of meetings” and “reporting.” To me, this sounds like a “soft” approach to overseeing a group that serves its own members.

The Regulator claims they now have “greater control” and that the CEC is merely a “service provider,” however the reality is that a private lobby group still appears to hold a lot of sway. They are monitoring themselves through an action plan and reporting back to the government.

I am deeply concerned about the conflict of interest here. How can a lobbying body be impartial?

Australian taxpayers should not be sold out by a system where the foxes are guarding the henhouse.

Transcript

Senator ROBERTS: Thank you for appearing again. Why did the Clean Energy Regulator appoint the Clean Energy Council, a private industry lobby group, as the product listing body for solar panels and inverters under the Small-scale Renewable Energy Scheme? 

Mr Parker: Thank you, Senator. I well understand the question. I will flip the question to Mr Williamson in a minute, lest he not get asked a question today, which would be unfortunate in his final appearance! The appointment of the CEC was done through a process under the law which involved a competitive bidding arrangement, and CEC won that process. 

Senator ROBERTS: Were government ministers involved at the time? 

Mr Parker: Ministers set the legal framework. I don’t think it was actually a decision from [inaudible]. We’ll give it to Mark. 

Mr Williamson: Senator, to help you with the context, originally in the legislation, the Clean Energy Council had been nominated as the body both to accredit installers and also to list approved components. In the original regulations, they were named, and they were effectively a co-regulator. Minister Taylor, a number of years ago, asked us to do a review with the department of the integrity of the Small-scale Renewable Energy Scheme. Out of that review, there was a recommendation that it be competitively tested, as Mr Parker says, for both the accrediting of installers and the listing of components. We went through a process of going to the market. The Clean Energy Council did not put in an application to continue being the accreditation body, and a new accreditation body was nominated out of that process. As Mr Parker says, for the listing of components, there were a small number of applications, and the Clean Energy Council was determined to be the best of those. The new system, though, is—we have greater control of both the accreditation body and the listing process. They were a co-regulator in the past. Now they are providing a service that we’ve nominated them to do. 

Senator ROBERTS: They provide a service to you? 

Mr Williamson: Yes. We’re the regulator now. We’re the single regulator, so that co-regulatory model that existed before went with that process. Solar Accreditation Australia, SAA, is the accreditation body, and that has nothing to do with the Clean Energy Council. The CEC is, in fact, still the listing body, but they’re doing that for us, as is SAA for the accreditation of installers. 

Senator ROBERTS: What probity checks were undertaken before granting this role to an organisation that actively advocates for its members’ commercial interest? 

Mr Williamson: There was an extensive process, and I can pass to Mr Binning, who was involved in that.  There was a very lengthy process where a lot of questions were asked of the small number of bodies that applied. Mr Binning was actually the decision-maker, and he did not make that decision until we had done a range of checks of the applications and asked a lot of questions and made a lot of requests for further information. I might throw to you, Carl, to add anything else to that. 

Senator ROBERTS: Before you elaborate, what was your role at the time? Who was your employer? 

Mr Binning: The Clean Energy Regulator. I was the delegate for the final decision. As I recall, it was a very thorough process run through our procurement. There was probity advice along the way. A preliminary decision was made. Under the act, we were required to publish that decision. A range of submissions were made in relation to the proposed decision. Those comments were than taken into account, and a final decision was made against the criteria that were established for the process. 

Senator ROBERTS: That’s fairly loose, but it was a long time ago. How does the Clean Energy Regulator manage the inherent conflict of interest in allowing an industry lobby group to control product eligibility for government incentives? 

Mr Binning: We do that through the ongoing governance of our arrangements. We have a regular cadence of meetings and reporting to us. In that reporting, what we’ve really sought to do over the last 18 months—there are two issues that really run intention through that product-listing process, if you like. On the one hand, we are looking for those assessments to of course be comprehensive and rigorous, and that requires that new products, as they come into the country, are compliant with the standards that have been established for those products, whether it is solar panels, inverters, batteries, solar water heaters et cetera. Most of the feedback we got from industry was associated with long wait times for the processing of applications. We’ve had less concerns, relatively speaking, with the rigour of the process and greater concerns with ensuring that the assessments are processed in a prompt and efficient manner. We’ve been working quite closely with the CEC to ensure that there is no compromising of the integrity of the process but that their ability to process applications has been improved. 

Senator ROBERTS: Is the process open to inspection from the public? 

Mr Binning: I’d have to take the detail of that on notice. I wouldn’t say there’s anything that overtly precludes that, but there would be the usual commercial in confidence and those sorts of arrangements. I’m happy to take it on notice and provide advice. 

Senator ROBERTS: I’d appreciate that, and if you could provide the specifics around that on notice. Has the Clean Energy Regulator assessed whether this arrangement complies with Commonwealth probity standards for regulatory functions? I assume there are some. 

Mr Binning: As I said, we have a procurement team at the Clean Energy Regulator. They closely observe the process, and the decisions were made consistent with the requirements that are set out in the act. If my recollection is correct—and I think it is—this process is largely governed by the requirements that are set out in the regulations and in the act. Mr Williamson can probably add to this. 

Mr Williamson: The government and the minister at the time wanted to work within amendments within regulations. 

Senator ROBERTS: That was Mr Taylor. 

Mr Williamson: Correct. To work within the regulations and amend the regulations to give effect—and not to have to go back and amend the act—limited the way in which this could be set up. It wasn’t set up strictly as a procurement but rather as a nomination that required us to go through a set of statutory steps to go out to the market on a number of occasions. Then, as Mr Binning said, with decisions both on the product listing and the accreditation of installers, we had to say that this was our proposed decision and invite further comments. It was a statutory nomination process, but we did actually follow Commonwealth procurement and probity arrangements. 

While it wasn’t strictly a procurement, we did follow such arrangements in arriving at the decision on the nomination process. It took a very long time. The reason it took a long time was to make sure that the applicants were bringing their applications up to a standard where we could make a decision and get a body for each process over the line. It wasn’t fast because those initial applications weren’t adequate to make a nomination. There was a very iterative process with those who applied to make sure that, ultimately, they had put in a satisfactory bid where Mr Binning could make a decision and say, ‘That passes muster.’ 

Senator ROBERTS: What governance framework exists to ensure that decisions made by the Clean Energy Council in its regulatory capacity are impartial and not influenced by its lobbying activities? 

Mr Binning: As I indicated, after awarding the role to the Clean Energy Council, an action plan around the service that they are providing has been established. There is a regular reporting arrangement which ensures, as I said, that they’re meeting the various performance targets that have been established. 

Senator ROBERTS: Does the Clean Energy Regulator audit or review the CEC’s product listing decisions? If so, how frequently and what were the findings? Or do you just have meetings? 

Mr Binning: I would say that we certainly closely scrutinise their performance under the requirements of the agreement that we have in place with them. In addition, we closely observe, monitor and interact with the Clean Energy Council around issues that arise or any industry intelligence that we receive. We will regularly be in contact with the CEC team to check and verify the processes that they are undertaking. 

Mr Williamson: I can add to that. We have also taken samples ourselves. Through separate arrangements with others, we’ve arranged to actually grab samples of products that have been listed and get them tested ourselves. That was both pre and post the nomination of the Clean Energy Council. 

Senator ROBERTS: That still happens. 

Mr Williamson: I believe that happens in batches every now and again. There are limits to the funds we have for this, but we have sampled it because some have claimed that companies may have had a golden sample taken and production runs may subsequently be of a lower quality. We have done that, and, as part of the listing process, the CEC also does more real world sampling. 

Senator ROBERTS: Thank you. 

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Tracking Vaccine Dollars

,

In this session with the Department of Health, I inquired about the total cost of our childhood vaccination program. While I didn’t receive an immediate response, the question was taken on notice.

The TGA also offered to provide a cost-benefit analysis of these vaccines. Frankly, I’m not expecting an honest reply. I will wait and see.

If they fail to deliver, I’ll pursue it at the next estimates. 

— Senate Estimates | February 2026

Transcript

Senator ROBERTS: How much do these vaccines cost the taxpayers every year: rotavirus, hep B and meningococcal ACWY?  

Dr Peatt: I don’t have the individual breakdowns of those vaccines, but I can tell you that, in 2024-25, the National Immunisation Program, which includes a raft of supporting activities that—  

Senator ROBERTS: Is that childhood vaccines?  

Dr Peatt: No, this is the full complement of National Immunisation Program vaccines and also other activities like communications and data collection, for example. We spent $762.8 million.  

Senator ROBERTS: Is there any chance of getting a breakout for the children’s vaccines?  

Dr Peatt: It’ll be dependent on whether that information is commercial-in-confidence, but I’ll take that on notice and get back to you.  

Prof. Lawler: I’ve mentioned previously that the regulator is involved in balancing the risk and benefit. I would highlight that it would be difficult to talk to the cost of vaccines unless we also recognise that these vaccine-preventable diseases cause an incredible burden of mortality, morbidity and cost. In fact, in the US, RSV is the leading infectious cause of paediatric hospitalisation. So the risk benefit is as important as the cost.  

Senator ROBERTS: That’s a good point, Professor Lawler—perhaps if you could include in that the benefits.  

Dr Peatt: Certainly.  

Senator ROBERTS: Denmark, Sweden, Norway, France and the Netherlands do not recommend rotavirus vaccines except for high-risk cases. The varicella vaccine in Denmark, Sweden, Norway, Finland, France and Portugal is not recommended except for high-risk cases, and hepatitis B vaccine is not recommended for routine use in Denmark, Norway, Finland, UK—Britain—France, Germany or the Netherlands. Surely the default is don’t vaccinate unless the need has been established. Can you show me any of these countries where the absence of the vaccination has led to a higher incidence of child harm—not infection but harm—than vaccinated countries?  

Dr Peatt: As my colleague Professor Lawler has outlined, it’s very difficult to compare different countries. That’s really because there are different disease impacts in each different country, which can be related to the public health measures that are in place and also the different diseases that are circulating. We also have different funding mechanisms. In Australia, we’re very fortunate to be in a country that has a program that provides vaccines for free that are recommended by our advisers. We are very fortunate in that sense. So I’d say that it’s very difficult to compare one country to another in terms of how they fund or recommend their vaccines. But I will throw to Associate Professor Katherine Gibney, who may be able to give you an idea about some of the assessment and information that they take into account when they recommend vaccines in the Australian context.  

Prof. Gibney: Certainly, ATAGI takes the epidemiology and burden of disease of each of these vaccine-preventable diseases into account as we consider who to recommend the vaccines for. Establishing a clinical need isn’t just about infection—in fact, counting numbers of infections is not particularly interesting. It’s hospitalisations, severe disease and death that we’re particularly interested in or long-term consequences that could be prevented through vaccination. So that’s really what we look at. The first question is: is there a need for a vaccine? Then we look at the vaccine. Considering that TGA has already assessed the effectiveness and the safety, we further review that in the context of the clinical need. Further to that, when we provide advice to PBAC, they look not only at the clinical effectiveness and need but also at the cost-effectiveness. So ATAGI don’t assess that, but that is assessed for every vaccine before a recommendation is made that it be added to the NIP.  

Senator ROBERTS: Well, could you show me anywhere where the absence of the vaccination has led to more hospitalisations and more deaths?  

Prof. Gibney: Certainly we can take that on notice and provide that.  

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