Peter Dutton’s budget-in-reply ticks many boxes, nuclear energy a tough sell

Peter Dutton and the Opposition want a network of small modular reactors in Australia. Picture: NCA NewsWire / Martin Ollman

A lot of budget coverage follows the ‘Yeah, mate but what’s in it for me?’ approach. The electoral response is really months away. Jim Chalmers’ budget sits on top of a number of assumptions which may or may not come to pass.

The most obvious of these is that inflation will fall magically back into the Reserve Bank’s optimal band of between 2 and 3 per cent next year.

Wages growth at 4 per cent is another hit and hope exercise. Wages are growing but not at the rate required at the moment.

As Tom Dusevic has written, Chalmers’ budget barely acknowledges let alone addresses structural burgeoning deficits of the future associated with cost blowouts in the NDIS, aged care and pension payments to retirees.

Simon Birmingham talked of cash grabs.

Sussan Ley spoke of a forgotten middle Australia.

After Chalmers’ handed down his budget, the Opposition’s responses were a mishmash of confusing metaphors. Seriously guys, can you start the day with a quick huddle so you’re singing from the same song sheet?

Sussan Ley spoke of a forgotten middle Australia (where is that – somewhere south of Alice Springs?), Simon Birmingham talked of cash grabs and Opposition treasury spokesman Angus Taylor went for the dreary canine cliche of drover’s dogs barking up a surplus.

While a lot of his colleagues are low wattage, Dutton has shown himself up for the fight. He is a formidable opponent and Albanese and Labor should not fall for the conventional political wisdom that Dutton is unelectable in southern states.

If Chalmers’ ragbag of economic assumptions goes south, then the pressure falls on Labor at the ballot box.

Joe Hockey’s first budget in 2014 was a time bomb. Picture: Getty Images

Analysed to the bicuspids at the time, budgets have a habit of blowing up on governments a few years down the track. Joe Hockey’s first in 2014 was a time bomb that ultimately detonated all over the Liberal Party last year with sporadic explosions that saw Tony Abbott and Malcolm Turnbull lose their Lodge privileges. Yet, when you go back and read the reviews of the $80 billion in cuts to health and education, you’d think Hockey had delivered the Gettysburg Address.

Dutton’s budget-in-reply contained a few messages that will keep the government on its toes. Immigration loomed large. Dutton explained he was pro-immigration, but it was the lack of a plan to take in the population of Adelaide (this phrase was used ad nauseam throughout the day) over the next five years that was the problem and where was the planning to absorb this new population of Adelaide amid a rental and housing crisis in Australia?

Frankly, it sounded particularly ominous for the people of Adelaide.

But it was good, solid politics from Dutton. Forget the xenophobic stuff. Housing has become the biggest issue in the country. There’s affordable housing, homelessness, public housing, the rental crisis, the haves and have-nots and the very notion that fixing demand in housing necessarily drops the value of assets either owned or under mortgage for a great chunk of the country.

Housing is an issue that will determine the outcome of elections for years to come. Chalmers offered nothing but a few bob in assistance to renters leaving Dutton to depict urban Australia as a burgeoning hellscape devoid of affordable housing.

But it was the nod to the Nats on nuclear which I found most intriguing. I really don’t understand this fixation, other than it’s a gimmick to promote no action on climate change.

The Coalition appears hellbent on pursuing nuclear energy in Australia. It’s going to be a tough sell. But all low carbon emitting technologies should be considered in the mix according to three criteria: low carbon emissions, cheap and reliable sources of electricity.

The Coalition is pushing for the advent of small modular reactors (SMRs) in Australia, a technology that exists mainly in CGI or Lego form.

The proponents of electricity generation by nuclear fission ignore two of the three major reasons for any form of electricity generation. Low emissions ticks one box. The other two, broadly speaking are, is it cheap and is it reliable?

The first large-scale nuclear reactor for electricity generation built in the US for more than 30 years is soon to come online in eastern Georgia. Fuel rods were delivered to the Vogtle 3 plant late last year under the watchful eye of the US Nuclear Regulatory Commission. The first sod was turned on Vogtle 3 in 2009. It should have been online six years ago and cost overruns at more than $45 billion will now be met by consumers.

Construction work at the Hinkley Point C Nuclear Power Station construction site. Picture: Getty Images

In Somerset England, Hinkley Point Nuclear Power Station was approved in 2008. Construction began that year, but it is yet to be completed at a cost thus far and counting of $60 billion. It is anticipated it will come online in 2028.

70 per cent of all electricity generation in France comes from nuclear power, all large-scale reactors. It’s one reason the French have a relatively low inflation rate compared to the UK. Food prices may have soared, but energy prices rose by just 3 per cent in France in 2022. But then the Brits have Brexit.

The heatwave in Europe last year saw nine of the 56 operable nuclear reactors in France closed or output severely restricted by regulators because the water temperature in French rivers were too warm for effective cooling.

Given this, large-scale nuclear reactors have no place in Australia. It might be wise if the Opposition acknowledged that. At the current rate of construction, any large-scale reactor would be 20 years away, costing billions with its location requiring vast amounts of water for cooling either on the Eastern seaboard or from our often drought-ravaged river systems.

Dutton and the Opposition want a network of SMRs in Australia. The trouble is, there are only two SMRs in existence anywhere around the world. The first sits on a ship in the Arctic Circle port of Pevek in Russia’s Far East. The other is in China. If there are any bad reviews, it’s fair to say we probably won’t hear them.

There are others coming. There’s an SMR under construction in Wyoming which will be built by Bill Gates. Not personally. I doubt Bill would be much good with some muck and a trowel, but he is funding it off the back of his Microsoft riches. There is another SMR under construction in Chile and another in China.

Most proposed SMRs are in the conceptual design stage. Cost benefit analysis, anyone? Anyone? Hello?

SMRs shouldn’t be ignored in the rush to provide energy security to homes and businesses in Australia. But setting one up in a nation that has little or no history in nuclear fission means importing everything and paying a large albeit indefinable amount of money to a shortlist of countries most of whom are not on our Christmas card list.