Australian news and politics live: PM slammed over ‘shambolic’ China response, Qatar-Virgin deal greenlit

Foreign Minister Penny Wong has had another go at the Coalition in Senate estimates, this time over its record in handling ties with Pacific Island partners.

She’s accused the Opposition of “vacating the space”, aid cuts and “frankly disrespectful language,” that is still being raised during her trips to the Pacific.

“The Coalition having lectured the Pacific, mocked their priorities and joked about the threat of climate change,” Senator Wong says, adding it led to trust in Australia hitting an “all time low.”

“Australia lost the opportunity through those years to be the only partner of choice and Australian security continues to pay the price of the coalition’s neglect and that vacuum.”

Peter Dutton says Anthony Albanese must explain why his version of the Chinese live fire incident differs from the chief of the Defence Force.

Mr Dutton said the PM was “either making up” his version of events, or “shooting from the hip, or completely out of his depth, or maybe all three”

“Is he misleading, or is he mixed up?”

Mr Albanese on Friday said that a Chinese naval task group gave “notice” of the live fire drill. And, on Wednesday suggested a warning from a New Zealand ship was received at the same time as one from a Virign Australia pilot - but it was actually an hour later.

ADF boss David Johnston had a different story yesterday, though, confirming that the Virgin pilot had alerted Air Services Australia at 9.58am last Friday after they picked up a radio broadcast from the Chinese naval task group of their plans to conduct a live firing exercise between 9.30am and 3pm.

The agency alerted Defence’s Joint Operations Command around 10 minutes later, about 10.10am.

“I’ve never seen a prime minister floundering like this...on the issue of national security, the first charge of the Prime Minister is to keep our country safe and to make sure that we have in place the settings which protect us against any acts of aggression,” Mr Dutton said on 2GB.

“What we do know is that he is at odds with the chief of the Defence Force, and he needs to explain why, on such a totemic issue, he either wasn’t briefed, that he’s made up the facts, that he’s got it wrong.”

Back to the economic estimates and the RBA’s grilling.

Katina Curtis reports questioning of RBA deputy governor Andrew Hauser has now turned to last week’s decision to cut interest rates.

He says that compared with other similar countries, Australia “is a clear outlier in a positive way” by having maintained such strong employment numbers while inflation came down from its heights.

“That strategy of protecting employment gains while bringing inflation down in a measured way, central banks never declare mission accomplished, but so far appears on track,” he said.

He said that keeping inflation sustainably within the target 2-3 per cent band remained the bank’s test for confidence about moving rates.

“That doesn’t necessarily mean that inflation on an underlying basis needs to be in the band, it simply needs to be expected to come into the band sustainably to be around the midpoint over the forecast horizon,” he said.

“We were not confident that that was necessarily the case throughout last year. But when we met in February, reviewing the data – the significant fall in inflation and, in fact, the faster-than-expected fall in inflation, the fall in wage growth, and we were very conscious of the persistent subdued pace of activity growth – that we had developed somewhat more confidence that inflation would sustainably be back to target.”

The timeline of when Defence and the Government was alerted to the Chinese navy’s live firing exercises was well canvased in Defence estimates yesterday.

But the Coalition isn’t done - Senator Paterson is pressing Senator Wong this morning.

The Foreign Minister was fast asleep in South Africa when her office was first alerted to the incident last Friday, about 11.50am AEDT.

That’s 30 minutes after Transport Minister Catherine King was made aware.

But Senator Paterson has queried whether it’s a “problem that domestic non-security ministers are finding out about serious security incidents in the region before senior national security ministers?”

Senator Wong says she briefed when she woke up, spoke to Prime Minsiter Anthony Albanese and agreed to raise the issue directly with Chinese Foreign Minister Wang Yi later that day.

Shadow home affairs minister James Paterson is the first to ask questions of Senator Wong, opening his bloc by asking why she felt the need to make such a partisan statement.

“I don’t recall an opening statement as partisan as that one, nor do I recall any of your predecessors in this forum making such a partisan opening statement. Is there a reason why you felt the need to make such a strong statement this morning?” he asked.

Senator Wong rejected the premise of his question.

After a bit of back and forth about whether Senator Paterson’s line of questioning to defence officials yesterday was a political stunt, Senator Wong took aim at the Coalition for their partisan approach to China.

Foreign Minister Penny Wong is accusing the Coalition of “trying to turn China into an election issue” and “beating the drums of war” ahead of the election.

The Coalition has stepped up pressure on Labor to take a more hardline response to Chinese live-fire drills near the southern coast of Australia last week.

The “same people who left a massive vacuum in the Pacific, the same people who had no regard for the consequences for Australian exporters or for Chinese Australian communities are at it again, trying to turn China into an election issue,” Senator Wong shot back during senate estimates on Thursday.

“We have been very clear that China is going to keep being China, just as Mr Dutton is going to isn’t going to stop being Mr Dutton, the man who once said it was inconceivable we wouldn’t go to war, is going to keep beating the drums of war,” she said.

Senator Wong said the Government would deal with China in “mature and responsible way.”

She reiterated that she had made clear to the Chinese Foreign Minister that the PLA Navy’s lack of notice about its live fire drills “did not meet our expectations and was of deep concern.”

Just in from Katina Curtis:

Canberra Economics estimates has opened for day two, with officials from the Reserve Bank at the table – but not Michele Bullock, who may well be sighing with relief after last week’s intense scrutiny.

She’s in South Africa for the G20 gathering of treasurers and central bankers from the world’s top economies.

Instead, deputy governor Andrew Hauser is in the windowless room in Canberra being grilled by senators about how and when the RBA board comes to its decisions in the newish two-day meeting format.

Top brass from the Reserve Bank of Australia will have a chance to provide their views on an uptick in underlying inflation when they face Senate questioning.

The RBA’s preferred inflation gauge - the trimmed mean - rose 0.1 percentage points to 2.8 per cent for January, while the more volatile headline consumer price index held steady at 2.5 per cent.

While the monthly figure released on Wednesday is prone to bounce around more and plays a lesser role in the central bank board’s decision-making, a continued slowdown in housing costs augurs well for March quarter data, available on April 30.

RBA governor Michele Bullock has said the board was cautious about the prospects of further monetary easing following its first 25 rate cut in more than four years earlier in February.

​Read the full story here.​

China has agreed to consider concerns that its military did not give enough notice before staging live-fire exercises in the waters between New Zealand and Australia last week, the foreign minister of New Zealand says.

The drills prompted passenger flights between the two countries to divert in midflight after Chinese naval vessels warned pilots they were flying above a live-fire exercise.

“I think it would be true to say that he took our concerns on board,” Foreign Minister Winston Peters said after meeting and having dinner with his Chinese counterpart Wang Yi in the Chinese capital.

Peters said he put the issue in the context of the close ties that the two countries have developed since 2008.

China is the biggest export destination for New Zealand and Australia.

“We’re in the second decade of this arrangement, and this is a failure in it at this time, and we’d like to have it corrected in the future,” he said.

He added, “That is something which we believe is under consideration”.