FRAN KELLY, PRESENTER: Chris Bowen is the Shadow Treasurer. Chris Bowen, welcome back to breakfast.

CHRIS BOWEN, SHADOW TREASURER: Well more to the point Fran, welcome back to you. Good that youre back with us on the air.

KELLY: Thanks very much. So Bill Shorten, calling on Malcolm Turnbull to work with Labor to bring in a Clean Energy Target. Is that a solid promise of bipartisan support if Malcolm Turnbull took a Clean Energy Target to the Parliament?

BOWEN: Fran, weve made it crystal clear. Bill Shorten, Mark Butler, myself, on multiple occasions that Australia faces a window of opportunity here to finally put the energy and climate wars behind us, to get sensible policy and to get policy certainty through bipartisanship. Now that means, people sitting down in good faith and giving up previously held positions to get the policy certainty we so desperately need so the investment can flow into clean energy.

Now the Governments own report by the Chief Scientist said that the Clean Energy Target wasnt the best policy outcome, but it was the one which had the best chance of bipartisanship and policy certainty. We agree. So weve said, in an act of, frankly, leadership, that we would step away from the things weve said before, sit down with the Government, and finally get this out of the political realm of constant battles about policy and give the sector the certainty it needs. That is a very, very genuine attempt by Bill Shorten and Labor to sit down and get policy certainty and an adult approach to climate change and energy policy finally. So thats a very, very genuine offer on our behalf.

KELLY: The Energy Minister, Josh Frydenberg, agreed with you yesterday. He said policy certainty is what the industry wants. Its not necessarily looking for a hand out, and he makes the point that the cost of renewables as it continues to fall, might be negating the case for targets.

BOWEN: Thats an excuse for a catastrophic policy failure on his watch, and on Malcolm Turnbulls watch. Now as the Chief Scientist was making clear as late as yesterday, a CET, Clean Energy Target, is about delivering that policy certainty that accounts for our carbon pollution, and aligns our international commitments that have been signed up to by the Turnbull Government on climate change, Fran, with our energy policy. Now that is what we so desperately need. And that policy puts downward pressure on prices. It actually reduces power prices, and also cuts pollution. Its not just about the cost of renewables falling, but its about providing that framework policy which we so desperately need as a nation, which are up for Fran. We are completely up for. This has been going on for far too long.

Now what it represents Fran, is a catastrophic failure by Malcolm Turnbull to stand up to the climate change deniers in his party, and his inability to stop the likes of Tony Abbott and Craig Kelly calling the shots - which has been made spectacularly clear overnight in London simply dont accept the climate science, think we can put our heads in the sand and pretend that its not happening. Running a continual campaign of sophistry, claiming that taking any action on climate change puts up power prices, which is just a lie. Now we will call it out and its time for Malcolm Turnbull to actually show some leadership the man who used to believe in something and call it out as well.

KELLY: Lets just bring listeners into the loop because we havent actually heard Tony Abbott deliver that speech in London overnight, but he will say, this is according to The Australian newspaper, beware the pronouncement that the science is settled on climate change and he goes on to suggest in the speech that global warming was probably doing good; or at least, more good than harm.

BOWEN: [Sighs]

KELLY: Whats your reaction to those comments?

BOWEN: Its 2017, Fran, and weve got a former Prime Minister, overseas denying the science of climate change. And more importantly that that he can say what he likes hes calling the shots on the policy of Australia. Tony Abbott is an effective handbrake on the current Prime Minister, stopping any sensible policy progress, when it comes to climate change and energy. Now here we have a rare window of opportunity; political systems decide what to contest, we say lets not contest the fact that climate change is real and caused by manmade activity, lets not contest we need energy policy to deal with it. Lets sit down so the investors, companies and boards, so regardless of who wins the next election, you will be able to invest with certainty. Were up for that, Malcolm Turnbull is not because he is too weak. Now Fran

KELLY: If Malcolm Turnbull doesnt implement a Clean Energy Target, is Labor preparing to fight a federal election on energy policy?

BOWEN: If we have to Fran, yes, if we have to. But what we would rather do is go to the next election providing the stability of a framework so that investors know regardless of who wins, they know the rules. It appears were not going to be able to do that. It appears that that window of opportunity, set up by the Governments own report, will be lost. We didnt commission the Chief Scientist, we didnt ask him to do this work, Malcolm Turnbull did. Alan Finkel has delivered a very good report which says heres a way forward.

We say we don't think it's perfect, it's not everything we would like but hey it's the best chance going, let's sit down and finally let's be adults; Labor and Liberal working together.

We've got this remarkable circumstance where the Opposition of the day is willing to be bipartisan but the Government can't reach an internal partisan position, we can't negotiate with a puff of smoke. We need the Government to have a position so that we can reach that policy certainty. We don't have that because frankly Malcolm Turnbull is just not up to it Fran.

KELLY: It's seventeen minutes to eight, our guest is Shadow Treasurer Chris Bowen. On another issue Chris Bowen the draft Productivity Commission report on the GST distribution found that the current formula for carving up the GST needs updating to deal with "extreme circumstances". The states are pushing back but do you see merit in an overhaul? The need for an overhaul?

BOWEN: Well Fran I think the best way forward is the one that Bill Shorten and I announced in Perth a month or so ago which is to recognise the legitimate concerns of Western Australia but not to disadvantage other states. It's very clear from the feedback from other states over the last 24 hours; this is going nowhere. We do not believe other states should be disadvantaged, they are relying on this money for their budgetary strategies. States like Tasmania and jurisdictions like the Northern Territory have significant challenges, not to mention South Australia. They should not be disadvantaged but we do recognise that Western Australia has a legitimate point of view hence weve said we would deal with it through the top up of Western Australian funding. We can do that because of the decisions we have made on Budget repair elsewhere, that is the sensible way forward, it is the only concrete solution on the table.

KELLY: But in a sense isn't that a stop gap or a band-aid measure? I mean the Treasurer Scott Morrison says the current system is holding the economy back because of the dramatic distortions in revenue for some states caused by commodity prices.

BOWEN: Fran, he yesterday couldn't even bring himself to admit that it would mean other states would lose. He was asked three times on television doesn't this mean that some states will lose grants. He couldn't even bring yourself to admit that. He selectively leaked the report to one newspaper. That is not the way that you progress sensible reform in this country. What's very clear here is that the Government has been in office now for four years, weve just seen Malcolm Turnbull go to Perth and promise a floor which hasn't happened. Now we've got a draft report of a Productivity Commission inquiry which is just yet another review the states have already rejected.

The only concrete solution on the table is the one that Bill Shorten and I announced in Perth last month which would deal with Western Australia's concerns and not disadvantage other states and territories. It's the way forward.

KELLY: Chris Bowen, thank you very much for joining us

BOWEN: Nice talking to you Fran.