Ed Husic (Chifley, Australian Labor Party) Share this | Hansard source

Thanks to the member for Bradfield for this resolution—I agree. Australians deserve a gas market that's predictable, reliable, affordable and transparent, not a radical proposition. Right now, our gas system defies even the gravity of basic economic logic. The consequences of this are felt in households, factories and businesses across the country. We face a projected seasonal gas shortfall by 2028, not because we don't have enough gas but because the gas that comes from beneath Australian soil is prioritised for customers offshore rather than customers onshore. Pre-pandemic gas prices sat at around $3 or $4 per gigajoule; today they're at around $10.30.

When I said that our gas prices defy the gravity of conventional economics, I meant this: domestic gas demand has actually fallen. Supply has sustained but been shunted off overseas. That's why falling demand hasn't been reflected in prices. The market is fundamentally distorted. Over decades, governments have entrenched this, largely by inaction, hoping the problem would go away. I'm proud though to say that, in the last term, this government was the first to have the guts to tackle this, even with the active resistance of the coalition. In late 2022, the government capped prices at $12 per gigajoule despite warnings from exporters and foreign buyers, who predicted the worst. Those predictions soured. We stepped in at a moment of crisis, and we were right to do so. Access to stable, affordable gas is not an industrial preference; it's a sovereign capability necessity. It'll be essential to the transition to net zero.

Predictable voices will tell you, 'All we need is more supply.' That's misleading. We need supply at the right prices, and we need contracts that are fair. Manufacturers often tell me they're unable to get contracts longer than 12 months because of the profiteering obsession of gas companies holding out to ramp up prices beyond the contract period. This is intolerable. Tinkering at the edges is not enough to fix this. The ACCC has doubted that past interventions aren't having a perceivable effect. We need strong action—a complete rethink of the terms on which Australian resources serve the Australian national interest.

In this country, it's almost like we're embarrassed about possessing so many resources and are so timid we feel we just have to cop what overseas companies and buyers tell us—what rot. Or we are spooked by this argument: if we demand too much these companies won't invest in new fields—lame. Former WA premier Alan Carpenter stared down that threat and established a west coast reservation system. Our generation trades on the courage of past generations without displaying the spine to do the same today. This timidity has allowed a structural flaw to fester, with domestic prices influenced by export prices and Australian users competing with Tokyo, Seoul and Singapore for Australian gas. We beg for the scraps—forced to cop globally indexed pricing that has absolutely no relationship with the cost of production. Our gas, our prices—that should be the bedrock, the cornerstone, of our thinking. The cost of doing business in this country, for multinational gas firms, is that they must provide a gas price in line with historic pre-pandemic levels. This should apply to any new field that's open, too. We absolutely need to establish a gas reservation policy to meet our local needs in this decade, not in the next.

We must stand firm on another issue. We cannot tolerate being lectured to by overseas buyers telling us what we can do with our gas when they on-sell the gas they get from us to make a massive profit. Last year, Japan resold a third of the LNG it had purchased from Australia, making over $1 billion in profit and in quantities large enough to supply our domestic industry for a year. We should reshape the Australian Domestic Gas Security Mechanism to allow the government to intervene, adjusting future supply based on past resold volumes. This nation should not be reduced to pauper status. We should be an energy superpower, and that should translate to economic strength. That's the ambition we should have no hesitation in pursuing. We may also need to prevent the sale of uncontracted gas offshore and ensure companies don't sidestep this by ramping up sales of uncontracted gas to drain what's available for locals.

We cannot wait for a better deal for this country. We should have the ambition to pursue better for this nation, and we should reject the naysaying and the fearmongering by those who want to tell us that we should cop something that we all in this place know we should not.

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