TOM CONNELL: Well, joining me now is David Littleproud, Minister for Agriculture and Emergency Management. He's been soaking up Beef Week over the past week. I'll just start with this one, Minister. I'm always intrigued at these sorts of things. You know, we talk about balanced diet. Is there much salad floating around at Beef Week?
DAVID LITTLEPROUD: No, there's not. I had lunch and dinner and had three main courses of beef through those two sittings. It's all beef and a lot of great beef. And you did butcher the name - it is Yuleba, just east of Roma. They are great constituents of mine and we produce the best beef in Maranoa, and glad to see we're taking home the prizes. But this is, this is just a great showcase of beef and- but also agriculture. The optimism here is fantastic. The prices are huge because we've had rain.
TOM CONNELL: So there you go. Yuleba. I just sensed as soon as I began that I was making an error. I think the Minister is just struggling. Do you still have me, Minister?
DAVID LITTLEPROUD: You there? I have, yeah. I've got Matt Canavan's ear pieces and they're made for his big ears and not mine.
TOM CONNELL: Alright. Well, we'll hope it works and try to persevere. I wanted to get you on and talk about this major announcement this week. It's called a $10 billion reinsurance pool for northern Queenslanders. So can you tell us, what's the average policy, you know, a normal sort of household is paying in some of these areas? And how much will they pay once the reinsurance pool is in place?
DAVID LITTLEPROUD: Yeah. Look, currently they're paying nearly double what we pay in south east Queensland or in capital cities around the country. It's, on average, around I think around $6500, $6600 a year. And obviously down the average in most places is around three odd thousand dollars. So, this is about trying to give confidence to bring competition into the insurance market, to bring insurers back in. We understand that there is greater threat and risk to insurers up in the northern parts of the country because of cyclones and weathers, and this is about making sure that we can reduce those premiums.
Now, I don't have the actual detail in terms of the final reduction and that's being worked through with the insurance industry as we speak. But it's also being complemented with $600 million worth of mitigation works - $200 million of that will go to households for them to do renovations to their properties from around $5000, up to $30,000, so it'll make them fit for purpose for cyclones and for floodings. And we've also put out there $400 million for mitigation works right across the country, but particularly for northern Australia. That'll build community infrastructure that'll reduce the risk and mitigate much of flooding and other disasters.
TOM CONNELL: You mentioned getting competition into the market. This has been analysed a lot, including by the ACCC, and it said there's no gouging. A lot of insurance companies actually lose money up in the North. It's the cost of the disasters. So, getting more competition in the market won't actually change anything, according to the ACCC.
DAVID LITTLEPROUD: No, and that's why we're complementing it with mitigation works - community mitigation works as well as household. And in fact, the Australian and Queensland Governments have already started that around household programs that we've run out in northern Queensland. But this is now giving that some real grunt from the Commonwealth, and we're asking the states to come with us. Because if we're able to lift the standard of those housing up in north Queensland, as well as give insurers some commercial support in terms of a guarantee rather than direct cash, then that starts to get other insurers interested in northern Australia again.
TOM CONNELL: Right. But then you just ended by saying it gets other insurers interested again. The ACCC said a lot of insurance companies that are up there are losing money, and certainly it's the least profitable market. So, the competition's not the problem there, is it? It's just the natural disasters that occur.
DAVID LITTLEPROUD: And that's why we're doing mitigation works, Tom, to build houses better, to a better standard that will withstand a cyclone so they don't get the damage. That's how insurance companies work. They work on assessment of the risk. So if we've done mitigation works, not just to the household but also the community, so that we make sure that there's community infrastructure that keeps the entire town safe, then that reduces the risk. And that's what…
TOM CONNELL: So wouldn't- yeah, wouldn't it be better to…
DAVID LITTLEPROUD: … insurance companies work on, they assess the risk. So we're reducing the risk by putting in commercial…
TOM CONNELL: Wouldn't it be better to tip all the money into that? I mean, I remember being in Cardwell and Tully after Cyclone Yasi. It was like seeing a deck of cards that had been flattened. And if you looked at that, you didn't think, well, maybe if their insurance premiums were a bit cheaper, it'll be fine. You thought, you just can't build those types of properties up there.
DAVID LITTLEPROUD: Well, it's two fold Tom, and I think there's still- we live in a very advanced society and I think we can live in those places. So I don't think we should dehabitate Northern Australia in any way, shape or form. We're a smart nation. We can back ourselves with new technology that will be able to make sure our housing's stronger. In fact, one of the major insurers in Queensland is in fact, doing that. At JCU in Townsville has built a house to be able to work or research to understand what standards will withstand cyclones and floods and bushfires. So we're investing in the smarts, not just retreating just because we think it's too hard. That's lazy. Australians are better than that. And that's what we're saying, is we've got to invest in making sure we give them the opportunity to do that…
TOM CONNELL: Yeah, and I'm not questioning investment. But it's a zero sum game. So the $10 billion pool to reinsure, how much will that be drawn down on each year? How much will the taxpayer effectively be subsidising each year in this scheme?
DAVID LITTLEPROUD: Well, look, I think the Assistant Treasurer and the Prime Minister are pretty clear on that. It obviously depends on what happens with respect to natural disasters. And not- one year is always different to the next. And so obviously, that's why that's been worked through with the Insurance Council now to make sure that they have comfort and understanding of how this will work. But we're also giving them that comfort, because you only have to go to the media to understand and hear the statements of the insurers saying they want to see public mitigation works and household mitigation works done, which is what will drive down prices. So I respect the ACCC, but when we have insurance companies telling us this is what will drive prices down for people in Northern Australia, I tend to think they're the ones that are going to send the bill, so I'm going to listen to them.
TOM CONNELL: I wanted to ask you finally about China, you know, the background there. And you're talking about good prices, and that always relies on multiple buyers. Suspending economic ties with Australia; is this bad news for farmers?
DAVID LITTLEPROUD: It's disappointing, but Australia's been consistent from the start is that we will continue to have our hand out for dialogue. It takes two to have dialogue and the best way to resolve any differences is through dialogue. So our position hasn't changed, obviously we're deeply disappointed by it. But the world moves on. And what we've been able to do in Australian agriculture is diversify our economic base, our markets. And we've said- we've seen that already with barley. We were hit with barley, we sent our first boatload of barley to Mexico for their beer and we found a new market for 750,000 tonnes in Saudi Arabia. They've also given us extended shelf life in Saudi Arabia and the Indians have given us a better, better market access for barley as well. So we've been able to send boats left and right, but we want to continue to have that dialogue. When they're ready, we'll be there, but we will not compromise on our values or principles or our sovereignty.
TOM CONNELL: Minister, is China a bully?
DAVID LITTLEPROUD: No, I don't think calling countries, sovereign nations names is going to advance the cause and enrich dialogue. We will- we are prepared to have that dialogue with Chinese officials but they need to understand the values and principles of our nation and the sovereignty of our nation, that as a government, as a sovereign government, we will protect. There's been over 100,000 Australians who've lost their lives protecting that. And our legacy, as the custodians into the future, is to make sure we never relent on anyone trying to ask us to do things that is against that. And that's what this government won't do. And once they're prepared to understand that, then we're ready to have enriched dialogue with them.
TOM CONNELL: Okay. Minister, we'll let you go, perhaps fit in one more steak sandwich and they might add some lettuce to it for you.
DAVID LITTLEPROUD: Just for a bit of garnish, mate.
TOM CONNELL: David Littleproud, live there from Beef Week. Thank you for your time.