Greg Combet (Charlton, Australian Labor Party, Minister for Climate Change and Energy Efficiency) Share this | Hansard source

I thank the member for Canberra for her question. In its latest economic survey of Australia, as has been reported today, the OECD had some very important things to say about climate change policy and how it should be applied within Australia. The OECD’s main message was that setting a carbon price sooner rather than later was the best option for cutting carbon pollution within our economy. The OECD went on to say that the investment uncertainty in the electricity sector in particular should be removed ‘by the adoption of market mechanisms to set a price on carbon, thereby reducing emissions in an effective way’.

The OECD, which is one of the premier international economic organisations, is clearly indicating what we already know—that is, that the best way of reducing carbon pollution and addressing the challenge of climate change is to set a carbon price via a market mechanism, and doing it sooner rather than later. The reality is that many countries around the world, including the United States and China, are already taking a comprehensive set of steps to reduce carbon pollution within their own economies and to tackle climate change. I am sure the House would be interested to learn that 85 countries that have committed themselves to the Copenhagen Accord, representing approximately 80 per cent of global emissions, have pledged targets and other actions to reduce pollution and to tackle climate change.

Also, and pursuant to the previous question to the Prime Minister, countries are doing this through a range of different measures. They may include carbon taxes, they may include emissions trading schemes, they are including renewable energy targets and they are including subsidies for low-emission technologies. Each one of these policy approaches puts an effective price on carbon, even if that carbon price is not as overtly stated as it is through some particular mechanisms.

With that in mind the government has asked the Productivity Commission to determine the carbon price that is already adopted or planned by a number of other nations with which we have important trading relationships, including the United Kingdom, the United States, Germany, New Zealand, China, India, Japan and South Korea. The purpose of the Productivity Commission’s study will be to identify the effective carbon price in those important economies with which we have substantial trading relationships. This is extremely important, not only to understand the action that is being taken by our trading partners but also to properly assess the competitive arguments relating to the establishment of a carbon price in our own economy. The Productivity Commission will be due to report with that study by May of next year. It is a piece of work that was commissioned at the initial suggestion of the member for New England, and I thank him for that contribution.

The Prime Minister mentioned a moment ago the progress of the government’s multiparty climate change committee. There have been very constructive discussions which stand in total contrast with the approach taken by the Leader of the Opposition and those behind him on the opposition benches; it is also a position totally in contrast with the advice of the OECD.

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