John Cobb (Calare, National Party, Shadow Minister for Agriculture and Food Security) Share this | Hansard source

I rise to speak on the Carbon Credits (Carbon Farming Initiative) Bill 2011 and related bills. I have to say at the outset that just because it has the words 'carbon farming' in the title it does not necessarily mean that farmers will be able to gain any traction out of it. The legislation is incomplete, misleading and certainly open to distortion by the carbon tax and an emissions trading scheme. I have to say that we thoroughly support direct action and we thoroughly support carbon farming and the opportunities that it can give agriculture, but this bill is mutton dressed up as lamb. For those who are unacquainted with the phrase or are vegetarians, that really means a 50-year-old trying to dress up like a 20-year-old. The term sounds good and you would imagine the legislation is but, as the shadow minister said, there are no ground rules within this legislation. There are no fences. We do not know what we are dealing with apart from the fact that it is a carbon farming initiative bill.

The Labor government want parliament to vote on a carbon farming scheme despite there being no detail and, while the coalition most definitely supports carbon farming and direct action, there are serious flaws. For example, the bill is reliant on regulations which are yet to be presented and will be done at Labor's and the Greens' pleasure. We will not support legislation that does not provide adequate detail or that leads to perverse outcomes for farmers unless, perhaps later in the Senate, the government can come up with amendments which deal with all these issues—and there are a lot of them. How are they going to do that when we do not know what the situation is regarding a carbon tax or an ETS in the future?

Under the direct action plan, the coalition will reduce CO2 emissions through biosequestration in general and, in particular, the replenishment of our soil carbons. Under our plan, farmers will be entitled to tender for additions in soil carbon. Significantly improving soil carbons also helps soil quality, farm productivity and water efficiency and should be a national goal, regardless of the CO2 abatement benefits. However, under the government's approach, the carbon farming offsets bill will be completely skewed by the legislation that may follow. It will undoubtedly lead to the wholesale conversion of prime farming land from agriculture to trees. We do not know the details of the tax or the ETS, so how can we assess this bill on whether it can be modified to account for the impact of it?

The offset bill allows for the creation of Kyoto and non-Kyoto credits. As only Kyoto credits will be recognised—in other words, eligible—for trade in an ETS, the voluntary market for non-Kyoto credits, the most attractive to farmers and the ones supported by the coalition's direct action plan, will be worthless and will collapse. Voluntary offsets are currently at about 15c per tonne on the Chicago exchange. Under an ETS with a fixed carbon price the CPI, like managed investment schemes, will skew the market in favour of trees which will be shut up and can never be harvested.

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