“Keep Quiet”: Officials Told Not To Talk About Australia’s Fuel Supply

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Everyone's getting really excited about it, but the government's telling us not to worry. We've got the most fuel we've had for 15 years. Not quite the right answer. So there's a bit of a problem there. Yeah, we do have the most fuel stocks for 15 years, but is that enough to address our fuel resilience issues? And my view is no, it's not. All right, so there's a bit to get through. Let's start, first of all, with you. Take me back to, what was it, 2013, '14? Are you commissioned to do what? Yeah, so I left full-time service to the Air Force in 2008. I started doing work in think tanks, and in 2011, I did a study on defense logistics, and I then realized that when I was the deputy chief of the Air Force, I had no real understanding of logistics. It was incredibly embarrassing. So I started to dig into this and ended up coming across in RMA, and I did a very short review of what's our fuel supply like. And I was absolutely horrified at what I saw. That's started a series of reports sponsored by NRAM A. Then a group of about 14 organizations, we triggered a Senate inquiry in 2015, which came out and said, we've got a problem. Andrew Hastie came to me in 2017, because he read it, and then Hastie, let a joint standing committee in 2018, that said, we have to do a liquid fuel security review. 2019, a report was published, an interim one, that said, we've got a problem. 2020, the final report was classified, but thanks to Rex Patrick's FYI modes, we can actually see what's in it. And about that time, I was actually speaking with Angus Taylor. He used to ring me at home and yell at me, but we got on after a while. He has got a sense of humor. So we were talking about what needed to happen. So in that process, there was a slow awakening, but all the way through that, discussions I have with Jim Mullen, who goes back to Millage Day's with me, when we'd identified things like, there's no national security strategy, or we've got a problem here. A lot of politicians I've dealt with were being told, look, it's not an election issue, so I just don't raise it. But Jim Mullen, being Jim Mullen, said, no, I'm going to raise it. So we kept pressuring it. Angus Taylor putting place some measures, not enough, but he started stuff, which was good. Things like mandate stockholding. We didn't require any importers to hold any stock levels at all. It was just up to them. So Angus came up with that gaseous sponsorship to the refineries, offered it to four, but only two tickets. So I'll be running two refineries now. And he also put in place a program to start subsidising the building of stock. The current energy medicine has taken credit for that. But I interacted with Angus Taylor this morning. And no, it was him that started it. But there's a long way to go. It's not just about stocks. So take me back, John, to when you first started looking at this analysing it, you said that you were surprised, you were shocked. What was it about your early findings that you can reveal? Well, what happened is I started to dig into it and understand what the supply chain was. Because in defense, the logisticians are really effective and capable. And they don't want the pilots interfering with stuff. So we didn't dig into it. But when you start looking at the data of it, and then what it's connected to, I found a report from 2012 from my department agriculture. And what our food stocks were in the supermarkets, and you don't need to be a genius to work out, the whole country runs on diesel. If you don't have diesel, the trucks don't move. If you don't have trucks moving, you're going to run out of food stocks between seven and 10 days in the supermarkets if we don't panic. So I then started to look back the fuel. In 2012 or '13, we had 12 or 14 days of diesel in the country. And there was a case where down in Victoria, the Altona refinery, which no longer exists, went offline for maintenance. The Jolong refinery went down because the Victorian power supply, the electricity supply had a problem. Now, dumb old me, I thought, if you've got a refinery and you've got fuel, you generate your own electricity. No. So the refinery came down. So you say, 14 days of stocks. They ran out of diesel in Gipsland and in Western Victoria in two days. But if it was a farmer in Northern Victoria, he and the other farmers were driving in a new South Wales with trucks with those big plastic things in the back to get fuel for the crop. Where in a similar situation today, where there's a bunch of farmers can't get fuel stocks, even though there is actually no existing fuel supply problem in Australia. OK, so we need to dive into that. Because as we revealed yesterday, it seems to me that the full big foreign petroleum companies cartels, as we've been labelling them, hold an enormous amount of stock, but they're rationing it out at this point. So farmers are inundating with me messages from all around the country saying, mate, they're telling me there's no supply issue, but we can't get F in fuel, right? We can't get it. And it could be days, weeks. We don't even know. We're going to harvest. We're going to see if we're going to do all these things. I've just got to drive the tractor. Can't get it. So what possible reason would the petroleum companies be holding on to all that stock for? The petroleum companies, the wholesalers, are modifying it a bit for a very good reason. Let me just step way back from the figures and explain how the whole thing works as best as I can. So on the one side of it, you've got supply. Right across the world, we used to produce 40% of all our fuels and fuels and transport fuels back 20, 25 years ago. Now imagine that. We will. Now we produce less than 10%. So 90% of all our fuel is imported. Now, if someone goes a bit crazy and decides to go and attack another country, right where all the fuel oil comes from, then what happens? We're currently impacting it with 20% of the world's oil supply, 25% of gas supply. But it's not just that. Chemicals, fertilisers, our fertiliser prices went up by about 35% last week. So all these other things in chemicals and products and ammonia and chlorine, we're losing 20% of the world supply there. But that takes a fair while to flow through the system. It's like a tsunami. You can have one in back in India. It takes 14 hours to get to the other side of the sea. So that will take a while to flow through. Most of our refined fuel, about 75% of the total quality of what we have, comes from refineries. The biggest source is South Korea. They're in Singapore, Malaysia, India, Taiwan, China, Japan. They've got huge dependencies on that oil in the Middle East. But they've got stocks, stuff still flowing before Trump causes problem. So that will flow through the system. Then you'll start to see effects on the refined fuel supply. And that's when we'll start to notice real supply issues. But there's still 80% of the oil working. Hang on a second. I need to get my head around that. That's when we'll notice real issues. Yeah. So what does that look like? OK. So think about it. You could demand on one side. You've got-- sorry, supply on one side. And you've got a pipeline. That pipeline is a virtual one. It's how we process with frineries, how do we move fuel, how do we get it here. And not the other side, you've got demand. So when you see something on the supply side of people go, holy cow, I've got a problem, they rush out and start panic buying. Just like toilet rolls in the pandemic, we used to produce all their own toilet rolls. So they panic. And what they do is they drive up the demand end in some areas-- the figures I heard yesterday from the politicians were 130% and 140%. Now, that system from supply through the pipeline to here is designed to give us a certain level of flow for normal circumstances. The interaction from the Middle East hasn't hit our pipeline yet. That won't happen probably for another week or two. But what people have panicked? Now, when you panic and you increase your demand by 36%, the system's not designed to do that. So this is not a matter of the company saying we're going to withhold stuff from you. The system is starting to get over stress because of our own behavior. And when you've got some politicians like in South Australia, I was told, go out and start stocking fuel. They're making the problem worse. So in that sense, what the energy of medicine is saying is absolutely correct. However, is it not true that I know of distributors and suppliers who would readily go down to any of the depots and fuel up four tanks, there only been offered one. Yes. So explain that to me. So you all might have seen the shots of me a couple of years ago coming out of the water just magnificent manliness on a beach on the sunshine coast. It was just after Christmas day. I wasn't at my best. Since then, I have been on a health kick. And I had no energy. I wanted to change that. I go to the gym now regularly three or four times a week. So I started taking R5, which is designed specifically for people in their 40s and 50s. This staff has changed my life. You get 20% off by using. using the code callus go to revive5.com.au - Okay, so when this demand has gone way beyond normal levels, what it does, it sucks that pipeline drive. So if you keep saying to people yes, I'll keep giving you what if you're asking for, you're gonna suck the pipeline drive further and make it a lot worse. So actually those distributors are being responsible, but the effect is very uneven because here's the other thing. If you say you've got 25 days of diesel in country, it's not spread out everywhere. This is why in Victoria, when they said they had 14 days, they had a problem they ran out into. The other problem is our distribution system around the country is just say, okay for day to day stuff, but it's fragile. We can only move it by truck. We used to be able to move it by rail, but we can't do that anymore because there's no railing stock except from a very small part between Esperance and Calm Booli. The rest of us, rail system can't carry fuel. If you want to carry it by sea, well, we don't have any Australian flag ships that could move fuel or oil. So you've got a narrow distribution which gets thinner as you get out in the bush or the country or the agricultural areas. People have gone a bit crazy, ask for too much, so the company's going, hang on. If we keep doing this, we're gonna cause much more damage. So that's a responsible way, but if you're a farmer, you gotta go, hang on, what the hell's going on? I need the crop. Same problem they're gonna have with fertilizers shortly as well. So look, I appreciate what they're saying. In, you know, what the minister is saying is factually correct, don't panic by. But we've got a problem with our system. So if I can come back out and explain our system, so I've talked about supply and a pipeline and demand. If you suddenly ramp the demand up because you're panicking, you will damage that here's the next problem, the pipeline. Bring stuff to Australia. We don't have any flag ships. We've got no control over it. Yet the government at the moment is counting fuel stocks coming to us at sea in our economic zone as part of our stock hauling. The IEA doesn't let you do that. It's disingenuous. We've actually got 25 days of diesel according to the government figures in December. The minister talking about, well, Minon stock hauling 32 days and we've got more than that. Yeah, if you count the fuel is not here yet, that's not right. Secondly, 2012 we had seven refineries. So with refineries, you're not just importing refined fuel, you can take a lot more oil in and refine it. It's a bit more of a diverse sources. But we're down to refineries and the contracts to keep those allows to alive and run out in 2027. Hopefully the government's going to extend those. But two of our fineries, they're too small to compete economically with the Asian refineries, they're small. And the other slight problem is this. West Australia has the most oil resources in our country. On the north west shelf, they no longer have a refinery. It can't move it without foreign shipping. And that light-sweet crude can't be processed through our two remaining refineries. They're designed for a heavier crude. So we've got oil, but it's going offshore. So is it does not make sense? And this is a slight diversion, but does it not make sense for us to have our own? Yeah. And more of it? Yes. So because I mean, sometimes I get these thoughts and I don't know where they come from, but the ability for this country to be self-sustained and be able to withstand anything that's happening globally makes sense to me. It does. But when stuff we did with Jim Moll and about the National Security Strategy and the stuff we've done about this, what happens individual politicians are pretty good. But what Jim got told when he was trying to do some of these things when he was still alive, Morrison's office would say, "It's not an election issue. Stop talking about it." I've seen even energy ministers who try to get something done, but it's not a political priority, so there's no action taken. But anyway, this chain gets a little bit worse. We've got to build up the stock holding. We're down to two refineries. We can't refine some of the stuff we've actually got. And then the total logistics systems pretty thin. Now, when I've described those sort of areas across there, you think that somebody would do a risk assessment or risk and vulnerabilities about the total system I've just been talking about? Well, the last time we did one of those, Carl, was 2011. And liberal party, because I was a pain in the neck for them, promised to do one in 2015. And then they promised to do one in 2017. And then Andrew Hasties, you've got to do a fuel security review, hit them, but it didn't look at the total picture. But even beyond that, an energy security assessment should live within a national security strategy. Do you know when we last had one of those? 2011. The successive government, successive governments have dropped the ball. So, that's the politics of the ball. Yeah. So, what did you do? I wanted to sort of interrupt. I just wanted to-- let's finish off with the crisis right now. And because it's not finished, and that's my biggest concern. When we've got farmers, we've got these independent stations in country parts of Australia who aren't getting any fuel at the moment. We have hundreds of farmers, thousands of farmers sitting there watching their harvest. They want to see it. They want to do all sorts of things, and they can't do it. They're not getting fuel. And they don't know when they're going to get fuel. So, let's deal with that first. And what sort of prices they've gone from $1.60 to upwards near of $3 in the space of a week. What's it going to go to? Give me a picture of what the next couple of weeks are going to look like. People who have shortages that will vary across the country, the price will probably continue to rise. Even if Trump decides, no, I've won an extra-- it comes out of it. It will take quite a while for that demand, that supply flow to start working. If it stays in the waves going, then eventually that 20% shortfall will flow through the refineries and flow down to all the customers. So if that doesn't get resolved in the next few weeks, then we will face a case no matter what, that will have higher prices and about 15% or 20% less of total supply through that pipe. We're going to have to readjust. In these early stages-- What does that mean? Sorry, I need to ask you that what does readjust mean? Well, there's a bunch of stuff we can't do. They're going to have to start prioritizing. If we don't prioritize things like food production, logistics around the country, that's a real problem. So there are things we won't be able to do. Now, the case then is, well, the government has a thing called liquefuel emergency act. In 2019, they identified that that was not fit for purpose needed to be modified, reviewed, to allow the government to act fast enough in emergency to take control of things. So right now, what you see, the government hasn't declared an emergency or a shortage state. And the importers, the wholesalers, are doing some of the controls themselves. I'm sure with close consultation with the government, there were some changes done to the regulations underneath it. But from what we can determine, and the department's website said this in about 2023, the review of that got over taken by events was never fully completed. So there is still will be a fair bit of time if we win the government says I got a real problem when they institute rationing. Now, back in the 1970s, we had rationing. Odds and even number plates on cars. So right now, there's no alert status such. The thing is, the only thing it's going to make things move right now is pressure by media. And the general public to the government saying, look, you've got a real world problem right now. You need to work with the refiant, with the importers, and say, we will allow you to drop below the minimum stock level you're holding and apply that out in the areas where it's necessary. Because we're-- OK. That's what I'm working on. The thing is-- That's making sense to me. So how far away from the liquid fuel emergency act being triggered? Do you think we are practically? And would you enact it now? I'd be staying right now. There's all these uncertainties because basically, the US administration is unpredictable. And even if it comes down, we don't know. So I would be acting now. OK. We're going to take precautionary measures because we only have limited stocks. And we haven't thought about what else we have to do properly. And we haven't done the risk assessment. They, through a series of regulations that came in addition to minimum stock holdings, changed the way that government communicate. And there's a much faster interaction of communication through the committees. But everything I see says that basic act underneath it could take a while before the processes happen. The states are allowed to work out what they want to do. Everyone gets together. And then there's a government general proclamation to start rationing. The thing they found in 2019 and the Act was it would take anywhere between one and three weeks for that process to work. And you know, if you've only got just about three weeks of stocks, if it takes you three weeks to introduce rationing, you've got a problem. OK. So do you enact rationing now? They need to look at control and distribution measures. Now remember, 10% of our supply keeps going. It's Australian oil through Australian refineries. 80% of the world's oil is still flowing. So we're not going to get cut off. But we're starting to see the symptoms. So the first thing is you need to do some sort of measures to stop people panic buying. Because that's what's causing the problem. But not sure rationing does that. Now rationing would do. But the rationing could be this. Somebody turns into the garage with the 15 Jerry cans in the back. And as I've seen the photos on the roof, now you're not going to do it. And they can limit certain amount of-- you can't take more than-- it's like $5,000 or $100 with a few. So we need to have some measures to stop idiots doing what they're doing. It is a bit unfair. They're scared. They're panicking. On the farmer's case in these areas, there needs to be intervention so right. We are going to distribute to those areas that are currently being affected. The government, however, can only do that I understand at the moment. cooperatively with the various industries and with the state governments, but that needs to happen because we're seeing the symptoms. And simply standing up in Parliament like yesterday saying, "Well, there's no supply problem." And yet this is what people are doing. It requires more proactive. Whether or not they've got the legislative tools to be able to do it out fast, I'm not sure. So, I mean, it does irritate me as well when they get up there and they're almost, you know, virtue signalling people, but also, you know, blaming people for panicking. That's a communication thing as much as a practically logistical thing. And they've just got that wrong. People need to be explained. The people are smarter than what they think. And also they need to be respected in something so sensitive right now. And people are panicked. People need to get stuff delivered. They're going to get to work. And farmers, it's even more present. Here's what I haven't heard of politicians say. They're not getting cut off from fuel. That's 20% of the supply. The flow through effect that will take while it comes. 10% of our fuel won't get cut off because it's there. But also 80% of the world's supply is still running. So this is a little 20% problem here that cause cost problems and will give us some impact eventually. But this is nothing to run around. If we all keep behaving normally, as you would normally in your business, now where there has been an interruption, then government, industry and the states get together right. You can see a problem there. How do we ensure we release supply not to everybody, but to notice people are now suffering the problems, particularly farmers. But you would do that now. Yes. I wouldn't wait. We fail to prepare for these things. I mean, I've been carrying on about this 15, 16 years. What we do is we wait to react. Because when something goes wrong, everyone says we want to done now. But reaction to a crisis, like reacting to a bushfire, if you haven't prepared for things properly, you always take a higher level of risk. So rather than saying we've got it under control, tell people, look, this is 20% of the supply. The other 80 is going to keep running. And that's, you know, yes, there could be issues that we manage. But if you go out there and do this, you're going to hurt all your neighbours, you're going to hurt our industries. So don't do it. But you need to be proactive. If there's a problem, don't just say it's all right. There's no supply problem in parliament. You have a fight between the two parties for question time performance. What are you going to do about making sure that those folks who've been told they won't get fuel for three weeks? Now, that's not acceptable. Because the stocks are there is just how their manage is a problem. Really interesting points. So if you've got a farmer in Outback Queensland, a Julia Creek, someone who's, you know, doing the Bicheman roads for the government, and they need fuel now, how does that get sorted in the next couple of days rather than weeks? They've got the National Security Emergency Committees. They've got the processes and all these things are in place and they're working faster than they used to because of the regulation changes. So the mechanisms there, I'm just not sure that the act gives the government the legal authority to enforce things in a short time frame. That's my concern because they didn't follow through with the update to the act when they committed to do it in 2019. So there may be some legal restrictions of direction, but the leadership part is don't wait till you've got the authority. You need to step and say, how are we going to do this? Part of it may be if the companies are still under pressure to maintain minimum stock level, which is a legally mandated issue, you better give a relief on the requirement for this area or that area to manage it. Now this is not rocket science, girl. But to be honest with the population and just saying supply chains are okay, I don't think really registers with people rather than saying, look 80% of the stuff is still there and it will keep you flowing and it's not that 20% impact is not going to hit us for a while apart from price. That price is hit us straight away. So let's have a bit of thing. But right now 30% increase in fertilizers, if that middleist thing continues, then you're going to have fertilizers supply chain problems as well. That's coming through Morocco isn't and other parts of the Middle East, the fertilizers got to get through the streets of hallmuz and look, I don't know, I was looking at the streets of hallmuz this morning, some are saying that some ships are getting through but their minds everywhere, insurance companies aren't underwriting. So I don't know how that gets sorted quickly. Well, I've got a couple of million dollars worth of tanker. Are you really going to say, well, the US president said we'll cover the insurance? Yeah, right. Yeah. It's that's right. You're not going to go through and yeah, yes, we're blowing up all these mining should. Some of the mines you could put in the back of a big fishing boat and just took it out there and draped it because the channel is very narrow. It's about two miles wide. It's very narrow. So mining stuff, mining stuff is a very effective way of interrupting it. Well, I think we've got any mine clearance capabilities now. The Brits now don't have any mine cleaning capabilities and your reckon the US is going to send its Navy ships into a two mile wide straight. So you go through there within literally a couple of miles of Iran. They're really going to do it. So what happens then? I mean, we spoke to a farmer yesterday, Dan about this and he's wanting to get his hands on fertilizer. That's probably more of an issue for those who need that product, right? I think it's a cost issue on fertilizer right now. But again, that flow through that lack of supply will be a problem. But I mean, stuff gets really interesting beyond that. So refineries produce more than just fuel. There's condensate, there's chemical products, sulfur and sulfuric acid is really dependent on the Middle East because of the type of fuel they've got. Gases, chloroam production, industry depends on some of those things at the back end. Monew, urear and nitrogen. When you start thinking about shipping capability, you've got a bunch of ships tied up. As the costs of fuel and transport runs, all those costs of shipping go up as well. So you're not only just got the cost of fuel, you've got the cost of shipping that will go on top of everything because remember, we don't just import 9% of fuels, it's 90% of medicines. If you look at the sources of all our grain technology, 80% of all solar palm stuff is giant A's, all the other components. The mass of imports we're dependent because we did swallow the neoliberal religion just a wee bit much and we were about a just in time economy, not just in case. And we've got to rethink this. There's a balance. So what we've been arguing since pandemic, because we've been doing stuff on medicine supply chains before that is look, work out what are the things, smats already? What is it we need to have in this country across a range of areas that we need to have a percentage of control? It's not 100. But you want to downside more than 10% of the fuel supply and there's ways of doing that. So that's one part of it. The second part of it is there are certain things that are critical supply chains. So make sure that they're transparent and verified. In other words, they're reliable. The trust is supply chains. And this is why when I look at what's happening with defense and all that, so you're buying hundreds of billions of dollars worth of oil, because of the thing in China. Well if that's the case, why are we increasing our import fuel dependence on China? I think last year 25% of all I refined yet feel came from China. So if on the one hand we're going to spend a few hundred billion dollars and then we're going to ship stuff on ships that we have no control over. Largest merchant fleet in the world is Chinese. There's a bit of a disconnect here that if you're going to carry on over here about the being a threat to do all this stuff, well you better take a serious idea of what the impact is on supply chains. But no we don't. Because we're also what 30 or 40% dependent on China for our exports. So we're not facing reality. There is a solution. And that is what you do on the demand side, renewable fuels that are coming a whole bunch of other stuff. And yes, the government's putting this new low carbon liquid fuel stuff, but it's going to take over 10 years. So many stuff sooner. On the other side, how do you reduce demand? Well, there was fighting against emission standards which would have been a fuel efficiency for years by both parties. Now we've got a case. Electrification will be a significant part of trying to reduce the fuel dependency in the cities and in parts of the coastal regions where you might be able to electrify transport. You're not going to do that in the middle of the bush or for farms. So the mixture of electrification, looking at renewable fuels or biofuels to take the demand on the imported fuel down. So if you can up things build the supply, reduce usage rate, then we're doing bits of that. But we're not doing it as a whole system because our government doesn't work at systems. Every department looks after a different thing. Do you really reckon they coordinate? No. Well, and I'm not sure how we're going to reduce the reliance on diesel and ag sectors and mining sectors over the next little bit. Not a little bit impossible. Over a decade, if we're serious about it, you could produce renewable diesel because the price differential between renewable diesel is much less than the price differential between aviation fuel and sustainable aviation fuel. So it's feasible to do it, but you've got to have the government get beside it and not go well, we'll see what the industry does, which is what we've done for some of the renewable energies, other sectors. I spent the last three years working in the renewable offshore wind sector as a consultant. So we need to think very carefully, here's the next problem, if we're going to put all this electrification and transport, which is a good idea. And now we're going to work in AI. Now we're going to get all these AI data centers. The impact AI data centers have had on the US electricity system is huge. Do you reckon? What way? Why? It's going to be up 6% of their power supply, surely. So if you put a bunch of data centers in, you're going to put a huge load on the electricity network. Do you reckon we've got a really good design of a network over the next, say, 20 years that takes into account electrification of transport industry? And now AI data centers. Uh-uh. We don't. Wow. So there's pressure loads everywhere. It is. And again, when I give briefs, I tell people I'm going to depress you, but the end I'll tell you why I'm optimistic. And it's not just because of the drugs I want. So basically, number one, we don't need AI to tell us we've been strategically stupid. Number two, we've got enough smart people in this country to actually work at what to do and do it. Number three, we've got enough resources if we stop wasting money on $360 billion of subs that will never get delivered. The palms are never going to be able to design the one they're talking about. Their Navy is just about had it. Anyway, that's it. You know, don't waste money. The next point I say is we actually have a belief in this country, and I'm not being rude about individual politicians, that the political system is actually capable of looking at the issues, designing stuff and taking a long-term view. And it's not. Individual politicians are fine, but the two major parties have a short-term combative view. The ability of looking beyond the next election is fairly minimal. We might have had that with Hawke Keating and Howard, but that evaporated in the last 18 years. What I say to community groups, and I talked to a lot of industry groups, I'm talking to another one at Palm and House about two weeks, I say, look, you've got a series of problems yet. Look over the fence of that other industry group. They've got the same problems. Look, and another group that imagine if you teamed up and then you said to government, look, we understand you're only huge pressures, but this is not working. And you try to take shared responsibility for these issues that we think politicians can do. There are examples of where this works. I was in Finland last year and the year before, where you actually hear a discussion that community, industry and government have shared responsibility for their resilience. The political system is impossible of doing it. I mean, Jim Nolan got driven spare. I mean, here's a guy who understood the defences of major general. He was there as a senator. He has been driven spare because the party system crushes down that stuff because it's all about the next election. But if he's a professor and says, but this is not good enough, you know, so effectively, there were people in positions of government and power that were told to shut up. Yes. Up to the minister level. Why? Because the way the party machinery works. It's about the next election. So you've got all these, you know, political advisors and calculators working around a prime minister, Kim Morrison, as example, and it's about the next election. So imagine this, if you actually stood up and did a national risk assessment, one was started by Mike Pizzillo, but when you got fired for playing politics, it disappeared. We don't have a national risk assessment. But if you did one and he said, here's our risks, then it'd be pretty fair thing for the Australian public to go, what are you going to do about them? And you know what the answer is? We have no idea. So if you open the lid on the problems, then you've got to be prepared to be honest with people. And so listen, this is what we do know. This is what we don't know. We're going to do this and we're going to do that. I sent speech of the Singaporean prime minister at the start of the pandemic to Jim Moll and asked him to please pass it to Morrison's office so they could understand what leadership looked like. We've got that problem. But we've got resources, smart people. If we take shared responsibility, then together we can make our country more resilient. We've got to forget this idea that the USA is going to save us through answers and we don't have to worry about things. We have to face reality. We've off-short fuels. We've off-short medicines. Our hospital system is straining. Now, it's time to be honest with ourselves and have a little bit of sympathy for some politicians which is incredibly difficult. And so look, these poor bugs are trapped in a system. We collectively need to do that. Oh, you've lost me there, John. You've lost me. Right, I don't have no sympathy. And it's when they let people down, fail to explain. And what you're telling me now is that nearly 15 years ago you started on this journey and nothing has happened. It's got worse. We went from seven refineries down to two. We haven't done what we need to do in the period. I've had discussions with very senior people about the options, but they wouldn't do it. And the world's situation has got far more complicated. And we've had a pandemic and we haven't learned the lessons from that either in the health system or medicine supply chains. And the reason it also doesn't happen is this big pushback from the industry groups, the biggest adversary I had in all the things I did was you're straining in the Institute of Petroleum. Who said, "There's no problem the market can handle it yet." When we did the Senate inquiry, we were arguing for a national energy security assessment. The Australian Institute of Petroleum says it's not necessary, but if you do one, you can only use market scenarios. When they said that, I would all thank you, God. That became the central theme of what campaign in 2016, 2017 and '18. The Institute group says, and they're mostly foreign funded, we shouldn't be using our national securities scenarios to look at our energy security. We should only use market ones. And to me, anybody looks at that and goes, "You've got to be kidding me, but this is what these guys said." But how do they have the influence then money? You know, but come on, I mean national security is directly tied. No, no, no, no. The pressure, I remember going into a meeting with Chair by a minister, down one side of the table, we're all a few companies, down the other side table unions and the odd bonds like myself and the academics are at the end of the table and you could watch it. They'd all coordinated beforehand, they'd all pre-brief the minister, they had everything set up, the unions were doing there a bit and on the side and we were a strange odd bunch at the end who clearly wouldn't know what we were doing because we weren't in the industry. It's like that. John, Australia will be shocked by what you're saying, shocked. Well they need to be because, and again, I'm not blighted, there's some very good individual politicians and I've spent a lot of time behind the scenes with both parties. I've told them I don't support either of them, but systems broken. Look, federation structure aligns and I'm here to deal with. But you must be exasperated. Well, yeah, but I am, but the question of difference is this, I'm half my alpias from the military golf and play golf and talk about the old days. I'd actually like to try and make a difference and I'm fortunate. My wife keeps telling me, well we actually have made progress with you. You look at all the steps and the things, but from my background and my impatience, it is incredibly frustrating, but you don't give up because it's about the country. Yeah, the project we're studying now in our think town, we've done a lot of stuff on AI, the next project is Australia 2050. The people who graduated from high school last year, in 2050, they're going to be in the mid-40s. What's life like in them? I'll be dead by then. The boom is gone, but we've got to start talking about what is life like for last year's high school graduates in 2050 and do we want to do something about that? So that's our next win mill we're going to tilt it. I'll get you back to talk about that, but just on defence, national security. Just remind me how much we're spending on all this again. I've got the figures. I'm $60 billion. Billion, right? Okay. If we can't navigate with any degree of certainty, this fuel crisis. Okay. How on earth would we deal with a threat of greater magnitude? So now remember, when I was the deputy chief of the Air Force, I didn't get this. So what on about seismic cruel? So after I've done this study, I get together with senior defence people because I was still on the reserve until 2019 when I resigned out of frustration. And I said, this is a major problem. And I got told by very senior officers, "Oh, don't worry about it. We only need 3% of the country's supply and defence, so we'll get priority." So I went, "I try to calm down." Okay. You realise you can't operate your military bases without all the civilian infrastructure and support and the logistics to make things happen and all the civilians who work. Where are they going to get fuel from if you don't give a rat? So defence can and not have to go at the individual's here. It's just what the culture's like. You become very tunnel visioned. We're going to get priority. And the problem then is you don't understand the rest. I didn't either until I got out of the military and then did all this thing take stuff and started tilting at Wimbledon's. But that's the problem. And also defence has no understanding how business works. I've spent the last 15 years consulting on the business side of it. I'm involved in three startups and all these think tanks. And I realised that I learnt a lot in the military in a very narrow area. But the world vastly different. But there are things you could apply for military thinking into the area, which is preparedness. So our three, three pencil this. Shader Wednesday, be honest with our risk of vulnerabilities. Number two, you do nothing as an individual organisation. You have to team. And number three, once you understand your risk of vulnerabilities and you work out who you need to team with, then prepare and get ready to mobilise. We haven't even started at step one in this country. There is no coherent shared awareness or strategy. It's shocking to me. Well, the title of our report from all our resilience work, which is online as Australia, a complacent nation. Our reactions are too little, too late and too short-sighted. It's on the web. And if you want to get depressed about defence, Australia complacent nation, adrift in the South Pacific, I had to publish in America and France because at 8,000 words, it was too long for any professional magazine of Australia. And of course, if it's in the nearest paper, 800 words is the limit. But if you want to get depressed, just look that one up. It's on the web. It's number four on the Google search. And then I'll describe why have we gone so far off the rails in the last 18 years with defense and national security. It's a bit depressing. Well, we want to listen to it. I do want to get you back to talk about that because we don't have to wait for a defence magazine. We can do it on the Karl Steffanot Vickshaw. And this maybe not as cerebral. But it gets the point across, right? I think it's just the Australian public. This is really smart. And they're really hurting right now. And I've got to tell you this. I've got, I must have thousands of messages on our Instagram page from Farm is sending me messages. I don't know how to pay the bills. They don't know what the future holds. They've great fear is that, you know, fuel goes three dollars a liter over the next couple of weeks. That means any profit evaporates for them. So just to finish off on fuel for today and please don't, I'd love to talk to you again. What do we do in the next couple of weeks to make it easier to ease the burden? Number one, be honest with the public. Stop talking about 36 days. We don't have it. That's not in country. Number two, say, well, what are we going to do about this problem that is happening? Don't deny there's a problem. And then if the legislation doesn't allow that's where the politicians working at stake federal level and the distributors say, right, we've got a problem there. What do we need to do to fix that bit of problem? Do we need to give you a waiver on the stock holding that we currently mandate? Talk to them and work it out. But most importantly, don't treat the public like a bunch of idiots and say there's not a problem. Be honest with it and be honest about what we don't know because if you tell somebody, well, I don't know this, but I'm going to have a go at doing that. That's better than going, there's no problem. Don't worry about it. You're imagining this. And so this is very, very basic leadership. And that's something we sadly lack at the major parties. And I'm, you know, I'm sad about that in some ways, despite what I think about some of the individuals. Good to talk to you, John. I'll talk to you real soon. Appreciate it. You're welcome, Carl.