SUBJECTS: COST OF LIVING; SAFEGUARD MECHANISM.

PETER STEFANOVIC, HOST: Let's head back to Canberra now, back to one of our top stories, too, and that is Governor Lowe. He's already appeared once, senate estimates, he's back again on Friday. Joining us live now, the Environment and Water Minister Tanya Plibersek. Morning, Tanya, good to see you, by the way. So how did you think Governor Lowe explained himself yesterday?

TANYA PLIBERSEK, MINISTER FOR THE ENVIRONMENT AND WATER: I think Australians who are seeing their mortgage interest rates climb, whether it's their domestic ones or business loans, are really feeling the pinch. They're really doing it tough. There are obviously inflationary pressures on the Australian economy. Some of them are external, like the war in Ukraine and what it's doing to fuel prices. Some of them are internal, like the underinvestment we've had in skills in Australia under the previous government, causing all sorts of skills shortages in all sorts of sectors of the economy.

I understand that it's a difficult job that the Reserve Bank Governor has got, but at the end of the day, none of that matters for Australian families, because what they're facing is these pressures really pushing up the cost of living and as a government, that's what we've got to address. We've got to do that by responsible support where we can, like cheaper childcare, cheaper medicines, free TAFE, increases to wages. We've got to do it by addressing some of those supply chain issues, like making sure we've got the skilled workforce to run the economy in the way that we want to, and we're going to keep doing it. This is a complex set of issues we've inherited, but the Treasurer Jim Chalmers is doing a terrific job managing it.

STEFANOVIC: Well, on that. I mean, in a roundabout way, Philip Lowe is asking Jim Chalmers for help because there's only so much monetary policy can do, only so many levers that can be pulled. So, does the Treasurer and your government need to be careful with anything that might be inflationary in May? Whether that's energy rebates, whether that's any kind of cash handouts?

MINISTER PLIBERSEK: Yeah, and we were very careful in the October mini budget not to put additional inflationary pressures into that budget and of course, the Treasurer is bearing that in mind when it comes to the main budget as well. And that's why, for example, of the savings we made, they were very careful, and the revenue increases that we received, it's always welcome to get revenue increases. 99% of them went back to budget repair. I'm sure that if the other mob had been in government based on their previous record, that's not what would have happened. You would have seen money sprayed around at things that they considered popular.

STEFANOVIC: Okay, the Greens. They're threatening to derail the safeguard mechanism unless new coal and gas is nixed. So, what do you make of this ploy?

MINISTER PLIBERSEK: I think Greens voters, greens supporters in the community would be shocked to see the Greens walking over to sit next to Peter Dutton and Barnaby Joyce and vote against a safeguard mechanism. And it would take them right back to when the Greens voted with the Liberals to block the CPRS, the Carbon Pollution Reduction Scheme, out of the previous Labor Government. What we know is that the Greens and the Liberals voting together to block the CPRS meant more emissions for longer and I would be shocked if, at the end of the day, the Greens were prepared to do that again, to stop an emissions reduction plan from Labor that would be the equivalent of taking two-thirds of Australia's cars off the road by 2030. This is a substantial reduction in carbon pollution emissions. It might not be everything the Greens want, but the idea that they would vote against it and block action on climate change, I think, would appal their supporters.

STEFANOVIC: You knocked Clive Palmer on the head. Are you still committed to new coal and gas projects?

MINISTER PLIBERSEK: Well, I'll judge every project on its merits, but the fact that I have said no to the Central Queensland Coal Project because of its proximity to the Great Barrier Reef and the environmental risks that it posed shows that, of course, when we're making a decision on a case-by-case basis, I'm prepared to say no to projects that are environmentally damaging. And the difference between what I'm proposing which is we continue to take a case-by-case approach, and what the Greens want, is they just don't want any new development anywhere, anytime.

STEFANOVIC: So, you've shown that you're prepared to say no. Are you also prepared to say yes?

MINISTER PLIBERSEK: Yeah, of course. I've said that I will take a case-by-case approach. One of the things that we will be doing as the year progresses is rewriting our environmental laws and one of the changes, I'm proposing to make to those environmental laws is that large projects will have to disclose their carbon pollution. And I'd love it if the Greens were prepared to support those changes to the environmental laws when we make them because that will give them more transparency, more understanding. But we've got a mechanism for bringing down carbon pollution. It is ready for the Greens to vote for that now. And if they don't vote for this, the Safeguards Mechanism, all they will do is ensure that we have more emissions for longer. We don't need two mechanisms. We don't need environmental laws and the Safeguards Mechanism. We've got a mechanism; the Greens should get behind it and support it. That's how we get emissions down in this country.

STEFANOVIC: Tanya Plibersek, thanks for your time, as always. We'll chat to you soon.

MINISTER PLIBERSEK: Thank you.