Penny Wong

by Simons, Margaret;

  On Tuesday 1 December, Tony Abbott won a leadership spill against Malcolm Turnbull by one vote. Overnight, the party’s policy on the ETS changed. The next day, Wednesday 2 December, the Coalition, the Greens and the independents combined to vote down the CPRS.

  This, as it turned out, was the key vote in which the Greens’ position might have made a difference. The government needed the independents and other crossbenchers as well as the Greens to pass legislation. In the earlier vote, the Greens’ opposition to the legislation had borne no consequence. Even if they had voted with the government, it wouldn’t have been enough. But this time it was known that some Liberal senators were considering crossing the floor to vote with Labor. The leader of the Greens’ negotiating team at the time, Christine Milne, recollects, ‘I didn’t know how it would turn out. I thought the legislation might pass.’

  As it turned out, two Liberal senators – Judith Troeth and Susan Boyce – did cross the floor. Had the Greens voted for the CPRS this time, the legislation would have passed.

  Ross Garnaut comments today that it is one thing for the Greens to exercise a protest vote when it has only symbolic value. This was the vote that mattered and, despite his criticisms of the CPRS, ‘it would have been better to have it than not’.

  If the Greens had voted with the government in 2009, Australia would have had the CPRS since 2011. Quite possibly, Kevin Rudd would have remained prime minister, at least until the end of his term, and therefore Labor probably would have won the 2010 election outright. When a change of government came, it would have been much harder for Abbott to unpick a scheme already settled in its operation. Today, we would probably still be arguing about whether the targets in the CPRS were too modest – but at least the mechanism for action on climate change would be in place. The Greens’ vote scuppered that.

  Milne, though, is today unrepentant. She says that even if she had known that Troeth and Boyce would cross the floor, it would not have changed the Greens’ position.

  With the legislation rejected a second time, Kevin Rudd had been handed the trigger for a double dissolution election. John Faulkner and others were strongly in favour of the calling of an election. The party war-gamed and prepared over summer. A study indicated that Labor would win – though perhaps not increase its majority. The figures also showed that public support for action on climate change was fast decreasing. The lengthy policy development process – with so many reports, papers and alterations, together with the continual attacks from the opposition and industry – had eroded support. The Labor national secretary, Karl Bitar, advised Rudd that if he was going to fight an election on the issue, it would need to be soon.20

  Penny Wong, consistent with her pledge not to reveal cabinet discussions, even when others have done so, will not say what her position was, but others say she pushed hard to go to an election.

  In the meantime, there was Copenhagen.

  Wong left for the fifteenth Conference of the Parties to the United Nations Framework Convention on Climate Change at Copenhagen days after the parliamentary vote. She was joined by Rudd on 15 December. The conference was held in what David Marr was later to describe as the ‘big bland Bella Centre’,21 eight kilometres from Copenhagen’s city centre, or, as Rudd put it, ‘the middle of nowhere’.22 It was freezing outside.

  Wong says she approached Copenhagen with some optimism. Her previous dealings with world leaders, including China’s, had left her ‘able to see what the contours of an agreement might be’ – but it was clear to her very shortly after she arrived that the Chinese were not going to play ball. China and India pushed back against the Western nations of the world and their pronouncements on what should be done about climate change. The world order was changing, and China was asserting its newly acquired status as a superpower. Copenhagen was one of the places where this battle for China to be taken seriously – as a rule-maker, not only a rule-taker – played out.

  By the time Kevin Rudd arrived, along with the other heads of government, the conference was deadlocked. The images beamed to the world were of chaos on the floor of the conference, with endless bickering and procedural motions. A team of developing nations had come together under China and India’s leadership to block agreement.

  Penny Wong and Kevin Rudd retreated with other national leaders to that windowless room. Away from the conference floor, and at the invitation of the Danish prime minister, they led a negotiating group of twenty-five countries from developed and developing nations, aiming to reach some resolution. As Rudd tells it, ‘To say the surroundings were unprepossessing would be an understatement. It was a celebration of Scandinavian minimalist design. That’s an elegant way of saying the room was small, airless and uncomfortable.’ He and Penny Wong were to be in the room for most of the next twenty-seven hours.23

  Painstakingly, they worked through a rough draft of an agreement, focusing on areas of disagreement – chiefly around reducing greenhouse gas emissions to the extent necessary to keep temperature rises below 2 degrees Celsius by the end of the century, and the size and timetable for a global fund to help developing nations adapt. Time was limited. So were political will and physical energy.

  On that first day they continued until 3.00 a.m., when Rudd went to snatch a few hours’ sleep. Penny Wong had no such luxury. She managed a little sleep on the air mattress in the corner, then took over from him and worked through the night until Rudd returned at 8.00 am, and they worked together until 1.00 the following morning. Obama joined them mid-morning the following day, rolled up his shirtsleeves and got to work. They kept trying to reach a point of compromise, strung between low-lying nations such as Bangladesh, which wanted the limit to be 1.5 degrees Celsius, and those like China and India, which baulked at 2 degrees. Rudd suggested the deliberately vague wording ‘below 2 degrees centigrade’, which left open the actual limit. The debate rolled on into that night. Eventually, they reached a ‘landing point’, in Rudd’s words – the first time in the process that both developed and developing countries agreed to cuts in greenhouse gas emissions.24

  Wong recalls Rudd as ‘wonderful … extraordinary, outstanding’ at this meeting – as was Obama. ‘When you’re involved in politics a lot, inspiration comes sporadically. But I think they both had moments in that horrible room that were really impressive.’

  Finally, at 1.00 am on the morning of the 19th, they had the text of what became known as the Copenhagen Accord. Wong and Rudd snatched an hour’s sleep, then faced the media, Wong swaying on her feet.

  But the chaos and the political positioning on the conference floor continued. The accord was not adopted as an officially approved resolution. It therefore had no legal status. Progress had been made in that windowless room, but so far as the world was concerned, Copenhagen had failed. In Australia, it lent credence to the view that the nation would be moving too far and too fast ahead of the rest of the world if the CPRS were passed.

  Kevin Rudd recalls that even before the conference was over he was taking calls from Karl Bitar and fellow New South Wales ‘machine man’ Mark Arbib. In ‘full panic mode’, Arbib demanded that Rudd use the failure of Copenhagen to drop the CPRS back home, ‘lest it kill us politically’. Rudd records, ‘I told him to calm down and fuck off.’25

  In hindsight, the Copenhagen Accord represented significant progress, even though it was not formally adopted. Its main tenets – the figure of 2 degrees; shared responsibility between both developing and developed countries; and an international system of measurement, reporting and verification – were the basis for the agreement reached at the Paris conference in 2015.

  Penny Wong and Kevin Rudd had pushed themselves to the limits of physical endurance. They had done everything possible. Back in Australia, they got little credit.

  Wong was interviewed just before she flew out of Copenhagen. She admitted she was disappointed, but added, ‘What we need is to keep pressing on. This has never been easy.’ Meanwhile, Tony Abbott was proclaiming that Copenhagen was a
‘dud’ and that the government should not bother reintroducing the ETS. Some in Labor, including Julia Gillard and Wayne Swan, were beginning to agree.26

  Wong remembers meeting Christine Milne at some stage during that frantic, sleep-deprived time in the Bella Centre. She says Milne was shocked to find that no agreement would be reached. Others remember Milne taking briefings from the bureaucrats with the Australian team, and her face collapsing in horror as she realised Copenhagen, far from being the game-changer she had expected, might well fall apart. She had thought the world would move, and that meant Australia would be forced to move too. She had expected Copenhagen to reveal that Labor’s CPRS was too modest, not bold enough to merit support. Wong says she told Milne, ‘This is hard, Christine. Big reform is hard.’ She spoke about how it entailed compromise. ‘I think she maybe realised that what I was saying was right, and maybe that caused a shift in attitude.’

  Milne says she doesn’t recall the conversation but Wong’s account accords with her state of mind at the time. Yet nothing, she insists, would have convinced her, then or now, that Labor’s CPRS scheme was worthy of support.

  *

  Common to all the accounts of the fate of the Rudd government – except his own – is the perception that the prime minister was in a bad way after Copenhagen. Some describe it as close to a breakdown. He had panic attacks at meetings, became unable to make decisions, and the business of government bogged down.27 Climate-change policy, in particular, drifted.

  The vital decision was whether to go to a double dissolution election.

  In their memoirs, both Gillard and Rudd describe – with different emphases – a key meeting in January 2010 on the verandah of Kirribilli House. Rudd writes that Gillard told him she could not support going to an election, and that they had to dump the CPRS package. This weighed heavily with him. Gillard says she advised this course of action because she considered him unfit for an election campaign, but did not tell him so. Paul Kelly, having interviewed them both, deems this ‘one of their decisive encounters – complex, psychological and prone to contested interpretations’. He concludes, ‘It is false to think Gillard vetoed an election, because there is no evidence Rudd wanted an early election.’28 In the end, in Penny Wong’s words, the decision not to go to a double dissolution was made ‘by not making a decision’.

  In Wong’s view, this was the second turning point, after the failure to make the Senate sit until the legislation was passed. Once it became clear that there would be no election, she felt adrift. ‘I’m not a bad politician, but I couldn’t figure out what the way forward was once we knew we weren’t going to a double dissolution.’

  But she says that in some ways Gillard may have been right. ‘I’m not sure Kevin was up for a campaign. And she’s the deputy leader of the party and she has a role, and that’s her call. That’s a hard call to make. I didn’t agree with that at the time. We should have gone to an election, and Kevin agrees with that now. But I don’t discount Julia’s view. Kevin was in a difficult place at the time. What is unknowable is whether he would have been in better shape if he felt he had the team around him and everyone saying, “We have to do this and we’re behind you.”’

  In February, Kevin Rudd was considering delaying the CPRS and asked Karl Bitar to brief him on how to manage the retreat. Bitar commissioned focus groups and reported back that it was important to manage the timing and justification or it would do great damage to Rudd’s standing.29 Wong knew nothing of this at the time, but John Olenich remembers that they were both aware that Gillard and others were mounting a campaign for the policy to be dropped. Wong remembers at some stage in this period Bitar distributing polling figures that showed the CPRS had become an electoral liability. She says she responded, ‘Has anyone polled how bad it would be if the prime minister stands for nothing?’

  Meanwhile, Wong flew to Hobart to talk to Christine Milne, who had spent the summer preparing a Greens negotiating position, based around the idea of a fixed carbon price for two years at $23 a tonne – effectively a carbon tax – which would then segue into an Emissions Trading Scheme in which industry would pay for carbon permits and carbon emissions would be capped.30 Milne says she got the idea of a fixed price as a starting point from Ross Garnaut. Milne recalls that she and Bob Brown were ‘shocked when [Wong] rejected the scheme outright, saying she would not even take it to the prime minister for discussion’. Milne now believes this was because Labor had already decided to abandon the scheme.31 Wong disagrees. On her account, the Greens’ position was not politically realistic. As for Milne’s account of their dealings, Wong says she doesn’t remember refusing to take the Greens’ position to Rudd, and doubts that she would have said this: ‘It’s not my style.’ Nevertheless, Milne has repeated this claim in a number of interviews, including for this book, in her memoir, and in interviews for Paddy Manning’s Inside the Greens.32

  Wong believes that in this period Rudd had not decided to abandon the CPRS, but was searching for a fix that did not exist. He called for more papers and more analysis. She wanted him to face up to the battle. His focus had turned to health and hospitals. He would not. Meanwhile, Gillard was ‘implacable’ in wanting the CPRS dropped. Wong remembers, ‘It was difficult between us … I’ve given a lot of thought to what I might have done differently through all this time, but by this stage, given that I didn’t have the backing of the deputy prime minister and the treasurer, it was pretty hard for me to hold the line. It was hard for Kevin for the same reasons.’

  The issue came to a head at a meeting of the so-called Gang of Four – the cabinet’s Strategic Priorities and Budget Committee – on 21 April. Gillard and Swan insisted that Rudd drop the CPRS in the context of finalising the federl budget. This was the moment when Rudd rang Wong in Honolulu, who gave him the advice that turned out to be ‘exactly right’ – that backing away from the CPRS would be disastrous for his personal standing. Nevertheless, he made what in his memoir he admits was one of the worst mistakes of his political career: he agreed to drop it from the budget. Labor would delay the scheme until the end of 2012, and then proceed only if there was international progress.

  Rudd claims that he would have reopened the discussion at the full meeting of cabinet the following week but that option was closed down by a leak. On 27 April, journalist Lenore Taylor broke the news that the CPRS had been dropped.33 Rudd blames Gillard for that leak, seeing it as designed to damage him.34 Gillard describes it as damaging but is silent on its source. Wong, meanwhile, says, ‘I still get stressed when I remember that day. Lenore had the whole box and dice. She knew the lot.’

  Like all good journalists, Taylor will not reveal her source, but she says today there was no single source for the leak. She heard a version of events and tried to check it out. Some whom she would have expected to know if a decision had been taken in fact knew nothing, making her think what she had heard must be wrong. It took her days to be confident enough of the story to publish.

  Kevin Rudd portrays the Lenore Taylor story as what locked in the decision to drop the CPRS. Penny Wong disagrees. ‘I think I knew I’d lost before it leaked. The leak was an awful political problem … it was a bad decision by the government that had been leaked in a way that maximised the damage. Once you have a shift like that and it leaks and it comes out without any explanation, it’s catastrophic.’

  The impact on Rudd’s popularity ratings was immediate. His moral authority never recovered.

  *

  The move on Kevin Rudd by Julia Gillard and her supporters in June 2010 blew up fast out of a groundswell of panic and personal animosity, fuelled by factional powerbrokers and made possible by Rudd’s reduced standing.35 Doing the numbers for Gillard were the powerbrokers of the Right, prominent among them Senator Don Farrell – one side of the Machine power-sharing deal in South Australia. It was a revolt fomented not chiefly in cabinet but in the caucus, with backbenchers nervous about their seats.

  Mark Butler, at this time a backbencher
and the parliamentary secretary for health, had heard the rumbles. The plotters were saying that Julia Gillard was more competent than Kevin Rudd, that the government was adrift and change was needed, that marginal seats would otherwise be at risk. Butler knew more about what was brewing than some cabinet ministers, who found out for the first time that the move was on when it broke on ABC News on the evening of 23 June.

  Meanwhile, Wong had been trying to show support for Rudd, even as she struggled to justify the decision, which she had so vehemently opposed, to drop the CPRS.36 As late as 19 June, quizzed by a journalist on whether there was a move against the prime minister, she denied it. She said the claim ‘couldn’t be further from the truth … we are absolutely focused and united behind Kevin.’37

  Wong says there were problems with Kevin Rudd’s prime ministership but they have been exaggerated by those who deposed him to justify their actions. ‘People make things “more binary” than they really were,’ she says. Rudd was doing too much. He had a tendency, when things became difficult, to become paralysed, or simply move on to the next issue rather than dealing with the difficulty. It was, she thinks, a symptom of being emotionally overwhelmed. ‘I learned from that. You can’t allow yourself to become paralysed when things become difficult … And all these brilliant people who were advising him: they might criticise him now, but at the time none of them came up with anything except telling him to retreat …What was their great strategy? Something which killed a prime minister and massively damaged the government.’