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How $50 cigarettes burned a giant hole in the budget · The Front

• 0:03
  Speaker 1: From the Australian. Here's what's on the front. I'm Kristin amiot.
• 0:06
  Speaker 1: It's Thursday, March twenty seven, twenty twenty five. Peter Dutton
• 0:13
  Speaker 1: says he'll do better than Labour's promised two percent tax
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  Speaker 1: cuts if the Opposition gets up at the federal election.
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  Speaker 1: In his budget reply speech happening on Thursday night, the
• 0:22
  Speaker 1: opposition leader will pledge cost of living support, cheaper bills
• 0:26
  Speaker 1: and more funding for defense. Brisbane's new stadium will likely
• 0:33
  Speaker 1: cost more than five billion dollars and it's threatening to
• 0:36
  Speaker 1: blow Queensland's already ballooning Olympics budget. Premier David Chrisifooley says
• 0:41
  Speaker 1: he's confident organizers will keep spending in check. Those exclusive
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  Speaker 1: stories alive right now at the Australian dot com dot au.
• 0:52
  Speaker 1: Labour will pump more than one hundred and fifty million
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  Speaker 1: dollars into the Australian Federal Police Force in a bid
• 0:58
  Speaker 1: to crack down on the Lisit tobacco trade. The measure,
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  Speaker 1: announced in Tuesday night's federal budget follows years of tobacco
• 1:06
  Speaker 1: tax hikes that have driven smoking underground. That's today's episode,
• 1:16
  Speaker 1: but everybody else's tobacco's toasted. No, everybody else's tobacco is poisonous.
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  Speaker 2: Look you straight, it's toasted.
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  Speaker 1: For generations, it was a symbol of coolness. There's no
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  Speaker 1: smoking in this building, miss Tremel.
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  Speaker 3: What are you going to do?
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  Speaker 1: Charge me with smoking and rebelliousness and generally smoke just
• 1:38
  Speaker 1: after a Why don't you come back in about ten minutes?
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  Speaker 4: Ten minutes, you'll be smoking in.
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  Speaker 1: Hell and even sophistication, Sady, tell me about it. In Australia,
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  Speaker 1: smoking was a big part of the culture. In this
• 1:53
  Speaker 1: TV ad for Peter Jackson thirties, smiling men and women
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  Speaker 1: ride horses across red dirt and splash about in crystal
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  Speaker 1: clear water before presumably lighting up what was being touted
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  Speaker 1: as Australia's best value cigarette by month. The tide began
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  Speaker 1: to turn in the late nineteen seventies, when the Whitlam
• 2:27
  Speaker 1: government phased out tobacco advertising and smokers wised up to
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  Speaker 1: the health risks associated with cigarettes. By the mid two thousands,
• 2:37
  Speaker 1: indoor smoking was banned in most Australian states and territories,
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  Speaker 1: and less than a decade later this happened.
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  Speaker 3: Australia has scored a world first, following the approval last
• 2:48
  Speaker 3: night of new laws to introduce plane packaging for cigarettes.
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  Speaker 1: But since federation, Australian governments have taken a slice of
• 2:56
  Speaker 1: revenue from tobacco sales. It's been a good little for
• 3:00
  Speaker 1: the federal budget and an effective way to discourage people
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  Speaker 1: from smoking by making siggi's increasingly more expensive. The problem
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  Speaker 1: is it's worked a little too well.
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  Speaker 5: It's so expensive it's gone to about fifty bucks to
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  Speaker 5: buy a pack of cigarettes, and the thing is thirty
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  Speaker 5: dollars of that goes right to the government in excise.
• 3:23
  Speaker 1: Sarah Eison is a political reporter with The Australian. She
• 3:26
  Speaker 1: spoke with editorial director and the regular host of The Front,
• 3:29
  Speaker 1: Claire Harvey, on Budget Night in Canberra.
• 3:33
  Speaker 5: And so it's made it incredibly expensive to smoke. I
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  Speaker 5: have relatives in Switzerland. Smoking is still pretty normal in
• 3:39
  Speaker 5: Europe and they are never not horrifically surprised at the
• 3:45
  Speaker 5: cost of our cigarettes in Australia.
• 3:47
  Speaker 4: Yeah. So, which means if you want to smoke and
• 3:49
  Speaker 4: you don't want to pay fifty bucks a pack it
• 3:51
  Speaker 4: you need to go and buy some cigarettes under the
• 3:53
  Speaker 4: counter from an illegal retailer and that's created another problem,
• 3:58
  Speaker 4: Hasn't it huge?
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  Speaker 5: Really huge problem. I think it's really come to the
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  Speaker 5: fore in this budget this week more than any time
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  Speaker 5: I'd ever seen since reporting in the press gallery on
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  Speaker 5: health issues and otherwise, and it's shown that like seventeen
• 4:12
  Speaker 5: billion dollars has been lost or there's a seventeen billion
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  Speaker 5: dollar black hole. I'd describe it as in the tax
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  Speaker 5: space when it comes to what that'd expect in that excise.
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  Speaker 5: And it's different now because people are increasingly going to
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  Speaker 5: that black market, so it's at its lowest level the
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  Speaker 5: tax take from the cigarettes in fourteen to fifteen years.
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  Speaker 4: This is a trajectory that labor governments chose to get
• 4:39
  Speaker 4: themselves onto. Nicola Roxon, as Health Minister in the rud
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  Speaker 4: Gillard government, introduced plane packaging, the world's first plane packaging laws,
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  Speaker 4: which the tobacco industry fought very hard.
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  Speaker 3: This is the first, very courageous step that our parliament
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  Speaker 3: has taken to introduce plane packaging. We're going to be
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  Speaker 3: the first country around the world to introduce it and
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  Speaker 3: the first of January is the start date.
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  Speaker 4: The whole point of those was to make cigarettes less appealing,
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  Speaker 4: particularly to children. Then they've just gradually ramped up the tax,
• 5:10
  Speaker 4: haven't they.
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  Speaker 5: Totally Yeah, it definitely is something that the price just
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  Speaker 5: gets to a point where it's huge disincentive on top
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  Speaker 5: of the plane packaging. Now it's those pretty gory images
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  Speaker 5: that you see. All of that has just continued this
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  Speaker 5: push against buying legal ciggies over the counter.
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  Speaker 4: One of the reasons to do that was not only
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  Speaker 4: it's good for Australians not to die of lung cancer,
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  Speaker 4: but also lung cancer created an enormous burden on the
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  Speaker 4: health system and so did diabetes in all the other
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  Speaker 4: conditions associated with smoking, like heart disease. So in fixing
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  Speaker 4: this one problem, though the government's now created, as you said,
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  Speaker 4: a fiscal hole for itself, how does it.
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  Speaker 5: Patch that it tries to address the problem, and the
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  Speaker 5: problem at the moment is the black market. The government
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  Speaker 5: in this budget, while also announcing really that black hole
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  Speaker 5: and showing us what that looked like, also revealed one
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  Speaker 5: hundred and fifty million dollars in a crackdown on a
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  Speaker 5: llegal tobacco. So that includes fifty million dollars just for
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  Speaker 5: the Australian Federal Police to investigate to prosecute along with
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  Speaker 5: a range of other measures speak out. This budget builds
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  Speaker 5: on the progress that we have made together. So it
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  Speaker 5: figures if it takes out the black market and people
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  Speaker 5: still really want to smoke, then maybe some of that
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  Speaker 5: black hole will be patched again.
• 6:33
  Speaker 1: Coming up, more from Claire Harvey's chat with political reporter
• 6:37
  Speaker 1: Sarah Eisen.
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  Speaker 4: Sarah went for a walk downstairs earlier and I was
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  Speaker 4: stunned to find a whole bunch of people smoking in
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  Speaker 4: the Parliamentary courtyard. Is there something about the stress of
• 7:02
  Speaker 4: this building that drives people to the facts?
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  Speaker 5: I think though, so the stress of the building and
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  Speaker 5: something of wanting to keep an old part of the
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  Speaker 5: press gallery alive. It is a novelty for me though,
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  Speaker 5: for sure, to see that as well.
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  Speaker 4: This is something that once upon a time you could
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  Speaker 4: have thought would be framed as an ideological divide between
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  Speaker 4: say Labor and the Coalition. That the Coalition might argue, well,
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  Speaker 4: it's individual responsibility. People can choose to smoke if they
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  Speaker 4: want to. Labor is taking quite an unashamedly nanny's state
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  Speaker 4: approach to it around parliament though, Sarah, talking to politicians,
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  Speaker 4: do you detect that divide or do you think that's
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  Speaker 4: something that they're glad is diminishing.
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  Speaker 5: Oh look, it's moved on a bit. I find I'm
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  Speaker 5: not having the discussion about analogue as you'd say cigarettes,
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  Speaker 5: but more so E cigarettes or vapes. And that's particularly
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  Speaker 5: because not only is it an individual decision, but the
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  Speaker 5: e cigarettes has this divide over whether you see it
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  Speaker 5: as just a gateway to smoking or whether you see
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  Speaker 5: it as a cessation tool. And there's such a huge
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  Speaker 5: difference in the school of thought over vapes in particular,
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  Speaker 5: and that's where I've found the greatest difference in debate
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  Speaker 5: has been over the last few years in Parliament, both
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  Speaker 5: when the Coalition was in power and Greg Hunt was
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  Speaker 5: Health Minister. He tried to do a few things around
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  Speaker 5: vapes but had an enormous pushback from liberal colleagues, and
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  Speaker 5: now into labor being in government and those same concerns
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  Speaker 5: coming forward regarding vapes, and then of course we get
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  Speaker 5: into the entire discussion of who's still taking funding and
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  Speaker 5: donations from the tobacco company's cough wink wink, the nationals.
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  Speaker 5: So it's still something that is discussed a lot, but
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  Speaker 5: I think it's a lot bigger than just who's smoking
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  Speaker 5: an analogue drry. It's very complicated, the black market debate,
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  Speaker 5: the cessation debate, the individual responsibility debate. It's not just
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  Speaker 5: pro or Colm for the analog cigarette.
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  Speaker 4: The big tobacco manufacturer is like Philip Morris and British
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  Speaker 4: American tobacco have pivoted two vapes. This is what they
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  Speaker 4: now make. And that's a pretty smart business move, you
• 9:02
  Speaker 4: would think. And that's why the federal government introduced legislation
• 9:07
  Speaker 4: requiring vapes to require a prescription.
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  Speaker 2: A federal government will introduce tough new vaping legislation today.
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  Speaker 2: The new laws would see pharmacies become the sole trader
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  Speaker 2: of products in a bid to tackle the rapid rise
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  Speaker 2: in vaping among young people.
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  Speaker 4: What are you hearing about the levels of compliance with that?
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  Speaker 5: Pretty low? Pretty low. And it's interesting because the argument
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  Speaker 5: that this extra regulation is going to create a black
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  Speaker 5: market is an easy one to be deployed by tobacco companies.
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  Speaker 5: It's an easy one to be deployed by any lobby
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  Speaker 5: or opposition group. And the tobacco lobby's argument is that
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  Speaker 5: any form of regulation, any rules around them, it's going
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  Speaker 5: to create a huge, completely uncontrollable black market. At the
• 9:53
  Speaker 5: same time it has merit. It is actually something that's happening,
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  Speaker 5: and that is something that particularly in what we were
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  Speaker 5: discussing before when it came to the one hundred and
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  Speaker 5: fifty million dollars in the budget measures also went to
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  Speaker 5: e cigarettes because the fact is it's also not working.
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  Speaker 5: It is creating a black market. So sure it is
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  Speaker 5: the main argument used against any regulation. Is it completely
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  Speaker 5: fancy form faults? No, it is an issue, so that's
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  Speaker 5: something the government has to face as well.
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  Speaker 4: Is there any incentive for politicians to not take donations
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  Speaker 4: from tobacco companies? We saw with the election of a
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  Speaker 4: record number of crossbenches the Teals at the last election,
• 10:32
  Speaker 4: an increased focus on probity and integrity in politics. Is
• 10:36
  Speaker 4: anyone talking about banning donations from tobacco producers.
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  Speaker 5: No, but I think it's always the reputational thing, right,
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  Speaker 5: It's who's listening when people kick up a fuss. So
• 10:45
  Speaker 5: that's on things like gambling. Labours obviously had a huge
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  Speaker 5: issue on its hands when it comes to banning gambling
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  Speaker 5: ads online or whatever, same as the Nationals and others
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  Speaker 5: will when it comes to tobacco election to election, term
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  Speaker 5: to term. It might EBB and Flo how much this
• 11:01
  Speaker 5: cuts through. But the danger is when you really don't
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  Speaker 5: want it to, or when you're really writing a thin
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  Speaker 5: line on a certain seat, it cuts through and people
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  Speaker 5: think it's dodgy. So I do think that's as always
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  Speaker 5: the greatest incentive right votes.
• 11:23
  Speaker 1: Sarah Eisen is a political reporter with The Australian and
• 11:26
  Speaker 1: Claire Harvey is the editorial director and the regular host
• 11:29
  Speaker 1: of the Front. You can read all the latest about
• 11:32
  Speaker 1: this week's federal budget at the Australian dot com dot
• 11:34
  Speaker 1: au