It's being said that PG threatened to quit if forced out of cabinet. The PM's office strongly denies this, but has expanded cabinet to 22 Ministers. Apparently playing to punters in pubs for 25 years and being cheered by 70,000 people at the MCG doesn't show an ability to connect with ordinary people and sell government policy, whereas the ability to do tricks with knives shows you're up for it ...
Australian Broadcasting Corporation
Reporter: Heather Ewart
Prime Minister Julia Gillard has announced a Cabinet reshuffle that sees the demotion of Senator Kim Carr from the front bench.
CHRIS UHLMANN, PRESENTER: The Prime Minister says today Cabinet reshuffle focuses on her priorities for next year: jobs, the economy and sharing the benefits of growth. It also has a few other benefits. It injects some talented new blood, dumps some ministers seen as a supporter of her rival and consolidates Julia Gillard's power base. The big winner is Bill Shorten, who takes up the job of Workplace Relations, and we'll be hearing from him shortly. But as political editor Heather Ewart reports, the Prime Minister has expanded her cabinet because at least one minister simply refused to go.
HEATHER EWART, REPORTER: No, the political year is not over yet. Just as the nation thought it might be getting a bit of a break from its politicians, they were back in Canberra in full force today, the place abuzz with talk of a ministerial reshuffle.
JOURNALIST: Is the need for a reshuffle an admission of failure by the Government?
BILL SHORTEN, INCOMING EMPLOYMENT AND WORKPLACE RELATIONS MINISTER: You could probably ask the questions about reshuffle 10 different ways. My answer's still gonna be it's a matter for the Prime Minister.
JOURNALIST II: You looking forward to the reshuffle?
MARK BUTLER, INCOMING MENTAL HEALTH AND AGED CARE MINISTER: Just about to talk to my wife.
HEATHER EWART: By early this afternoon, the news out of their promotions to Cabinet, they'd found their voices for the media.
BILL SHORTEN: I am absolutely stoked that our Prime Minister has given me this privilege. I completely and utterly support our Prime Minister.
MARK BUTLER: I'm delighted have to be appointed to the Prime Minister's Cabinet, particularly to focus on the theme of fairness.
JOURNALIST III: What did the PM say to you?
TANYA PLIBERSEK, INCOMING HEALTH MINISTER: Um, she offered me the Health portfolio and I said, "Yes, please. Thankyou very much."
HEATHER EWART: They were three of the big winners from Julia Gillard's lunchtime announcement, but there were more in a shake-up bigger than expected.
JULIA GILLARD, PRIME MINISTER: I believe that with this new cabinet in place we will see an important mix of new energy and talent, as well as wise heads and experienced heads in Cabinet. We will see this new mixture which will give us the focus and the fire-power we need in 2012 to pursue the Government's priorities.
HEATHER EWART: Apparently so much so that Julia Gillard has had to expand the Cabinet by two to 22. But there may be more to it than that. Government ministers are saying privately that at least one of their team, the Minister for School Education and Early Childhood, Peter Garrett, threatened to quit if he was forced out of Cabinet. The Prime Minister's office strongly denies this.
JULIA GILLARD: The size of the Cabinet has been increased because of the breadth of the Government's reform priorities. What has driven me as I've shaped this reshuffle - and it is my decision as leader, obviously, who serves in which portfolio and who serves in Cabinet. What has driven me in this reshuffle is making sure that the Government's big reform priorities for 2012 are represented around the Cabinet table.
HEATHER EWART: Whatever the case, Peter Garrett stays, and so does former Attorney-General Rob McClelland, but with the new title of the Minister for Emergency Management and Housing. The big loser is former Minister for Innovation and Industry Kim Carr, a Victorian left-wing heavyweight. He's been dumped from the Cabinet and now has the manufacturing portfolio.
JULIA GILLARD: I have asked Kim Carr to continue to serve in areas for which he has a life-time passion and has done some tremendously good work.
HEATHER EWART: Is it a good move for her to demote Kim Carr, a well-known Victorian left winger?
NICK ECONOMOU, POLITICS, MONASH UNI: Well, I don't think it is because I think that Senator Carr is potentially a very serious adversary. Not the sort of person I would like to have as an enemy. But I think that Senator Carr, who's a former factional convenor, one of those famous factional faceless men, if you will, could easily return to his former skills and that could cause some trouble for Gillard further down the track.
HEATHER EWART: What Julia Gillard has done is elevated those she hopes will prove to be better salesmen for the Government. For example, Bill Shorten takes over the Workplace Relations portfolio after what was considered to be a lacklustre performance by his predecessor, Chris Evans. It's an issue that Labor plans to highlight in the next election campaign.
BILL SHORTEN: Let me be clear: there is a very stark contrast between the Government's approach to workplace relations and that of the Opposition. The Government believes very strongly, not only in creating jobs but making sure that the jobs that are created are good quality jobs where people get a fair go all round at work.
JULIA GILLARD: And I've asked Bill not only to focus on our Fair Work agenda, as important as that agenda is, but to also broaden our description and thinking about workplace relations so that it deepens our national understanding of how workplaces are changing.
TONY ABBOTT, OPPOSITION LEADER: Basically the Prime Minister is trying to buy the loyalty of the faceless men. These are the people who put her in there a year or so back. They're obviously thinking of shifting to Mr Rudd. Well, she's trying to buy some insurance with this reshuffle.
JULIA GILLARD: Tony Abbott's negative about everything, so, you know, of course he's negative about the reshuffle; what else would you expect?
HEATHER EWART: The Prime Minister and her new ministerial team are all about looking united and positive today, despite those ever-present mutterings about Kevin Rudd who'll now have to sit across from one of Julia Gillard's chief supporters, Bill Shorten, in the Cabinet room.
NICK ECONOMOU: He's a man on the move; we all know that. And so we watch him with great interest. A potential Labor leader. Potential prime minister - who knows? He's also pretty effective in the policy debate.
HEATHER EWART: To try to put her reshuffle in the very best light, Julia Gillard today emphasised her promotion of women. Nicola Roxon becomes Australia's first female Attorney-General and Tanya Plibersek goes into Health and the Cabinet room. The Prime Minister regards both as strong media performers and efficient operators.
JULIA GILLARD: I am determined, being the first woman to serve in this position as the nation's prime minister to see women take their full and equal place in our nation's decision-making. I'm very pleased, as a result of this set of changes, the nation will see its first-ever female Attorney-General and we will add another woman to our cabinet and another woman to our ministry.
NICOLA ROXON, INCOMING ATTORNEY-GENERAL: I look forward to the time my daughter, who's six, will live in a country where there won't be many things that'll be the first that a woman will be. There'll have been many female prime ministers, there'll have been female ministers in all sorts of areas.
HEATHER EWART: But will any of this matter to voters, especially at a time of year when they're more preoccupied with Christmas parties and summer holidays? The Prime Minister has sought to stamp her authority on this reshuffle, but in the long run, will it do anything to shift those troublesome opinion polls?
NICK ECONOMOU: Well, the Prime Minister needs to do something because the opinion polls are this side of disastrous for her at the moment. Two opinion polls have come out showed Labor would be lucky to amass enough Lower House MPs to form a parliamentary cricket team, so they're in real trouble. And this was supposed to be after two or three weeks of - that were good for the Government.
HEATHER EWART: Labor does have two years to try to turn things around. It can only hope that today's reshuffle might help.
CHRIS UHLMANN: Heather Ewart with that report.