Craig Kelly (Hughes, Liberal Party) Share this | Hansard source

I'm pleased to follow the member for Whitlam, channelling Bernie Sanders and Jeremy Corbyn at the dispatch box, ranting on about all those good, hard socialist policies. However, the one thing we see time and time again from Labor spokesmen on the economy and why they always get it wrong is: they think the size of the economy, the size of the economic pie, is fixed. They don't understand that the size of our economic pie, the total wealth created in the economy, can grow and shrink. The problem is, which they don't understand, every time that you step in and try and redistribute the wealth, you destroy the very incentives to create that wealth in the first place. This is why we see policy after policy from the Labor side fail.

The member for Whitlam talks about wage increases from tax cuts. I think the member for Whitlam should actually go and read a few things about what's happening in the USA, because they have reduced their corporate rate of tax. What's happened? Millions upon millions of workers in the USA are receiving pay increases. Many of them are receiving $1,000 cash bonuses from their employees. That is what is happening. That is the evidence of what is happening when you reduce the corporate rate of tax.

If we go back in our nation's history and we look at every single time we have reduced the percentage rate of corporate tax, do you know what's happened? Without fail, we have ended up with not only more tax revenue but more corporate tax as a percentage of GDP at a lower rate of tax. So we've not only grown the pie; we've ended up with a bigger slice of that bigger pie in taxation revenue.

No-one knows and no-one can guarantee that that will be exactly what happens in the future, but we have seen it every time in our nation. We saw it recently in New Zealand, where their conservative government lowered the rate of corporate tax. What happened in New Zealand? Wages rose, revenue rose and the government ended up with more revenue, not less. Everything tells us that the same will happen here in Australia.

We've also heard the member for Whitlam rant on about electricity prices. It's so timely that the member for Port Adelaide is in the chamber at this time. You learn as a young child that if you put your hand in the fire you get burnt and then you don't put your hand in the fire again. The way we progress—whether it's in business, as a society or even as a species—is by a series of small-scale experiments where we try something a little bit different. If it fails, we stop immediately and go down another track. If it works, we duplicate it and we roll it out. There has been a thought that a 50 per cent Renewable Energy Target—or should I correctly say a 50 per cent compulsory, forced government mandate for generation of intermittent and unreliable energy—would actually lower the price of electricity. That's what many theorists thought, and that's fair enough. If you're thinking about a new idea, it's good that people put their different views and opinions forward.

We've had this experiment of a 50 per cent Renewable Energy Target conducted before our very eyes in South Australia. It has ended in tears. It is probably one of the greatest policy failures in our nation's history at any level. It has delivered that state the most unreliable energy, forcing them to spend half a billion dollars in a state of 1.7 million people in a desperate attempt to keep the lights on by bringing in emergency diesel generators to have on stand-by. Not only that, on top of that it has delivered that state the highest electricity prices anywhere in the world.

Common sense would tell you that if you've tried that experiment and it has been an unmitigated disaster, you'd say, 'Yes, we failed,' you'd pull back and you'd go down another track. That's how we progress. As I said, if you put your hand in the fire and you get burnt, you learn as a young child that you don't do it. Yet we have seen the Labor Party look at South Australia and say, 'Let's copy the 50 per cent Renewable Energy Target and take it nationwide.' This is insane. This is completely nuts. And yet this is the Labor Party's policy on energy—to copy an unmitigated disaster, a failed experiment. It will see pensioners in this nation being unable to heat their homes in winter, it will turn air-conditioning into a luxury good; and businesses will be no longer viable so will be forced to move offshore because of the high cost of energy in this nation. That is what the Labor Party wants to copy.

I call on good members of the Labor Party to speak up in your party room—put aside trying to attract a handful of Greens inner-city votes. Think of the pensioners, the workers and the coalminers that the Labor Party used to stand up for. Ben Chifley would be rolling in his grave if he saw the plans of what they did—a Labor policy that pushed electricity prices up—and how they were selling out the pensioners and workers of this country just to attract a few inner-city Greens votes.

In the time left on this appropriation bill, I'd quickly like to raise the issue of electric cars. There's been quite a bit of debate about this recently in the media. In fact, even the Chief Scientist has chipped into the debate. He's taken the role of chief subsidy seeker in an article he wrote for the Sydney Morning Herald the other week. The Chief Scientist gets it wrong in many respects. The first place he gets it wrong is that the debate is not for or against electric cars. We're not arguing against electric cars. The debate is: should electric cars be subsidised in Australia? That's what the debate is about. Let's take a simple proposition. If electric cars are so great—and they certainly are; they have many wonderful benefits, and I'm the first to acknowledge that—why do they need a subsidy? Why do they need to be subsidised if they are so great?

Our job in government should be to level the playing field between technologies, to let them compete against each other as vigorously as they possibly can, to let them put the best offer they can to the consumer and to let the consumer decide. We shouldn't suppose that we know better down here in Canberra what car the consumer should buy. We should just level the playing field and let the consumer decide. But we already have a substantial range of subsidies for electric cars in this country. We have subsidised finance. We have the fact that electric cars make no contribution to the fuel excise. We have a luxury car tax break. We have subsidised registrations and stamp duty. There's subsidised charging, and we have a tax office ruling that allows very generous deductions.

The argument that's put forward for these subsidies and for more subsidies the electric car industry is asking for is that electric cars will lower emissions—that it's good for the environment. To take the words of the Chief Scientist, we should test this hypothesis with the evidence. And we can look at the evidence, because we can use the science and the maths to make a calculation of the grams of carbon dioxide emitted per kilometre travelled. That is something we can do. In fact, we do that with the Green Vehicle Guide that the government puts out. It is very handy; it does a good job. But it does, unfortunately, leave out a few things. I doesn't make any allowance for the losses for the transmission and distribution of electricity. That should add an extra 10 per cent onto the CO2 emissions of electric cars. It also makes no allowance for the fact that there are substantially higher manufacturing emissions for electric cars. And that's not just my supposition. That's from a study titled 'Comparative environmental life cycle assessment of conventional and electric vehicles' published in the Journal of Industrial Ecology, where the authors estimate that emissions from electric vehicles produce between 87 and 95 grams of CO2 per kilometre, compared with 44 grams of CO2 associated with a standard petrol or diesel car engine.

The other thing it fails to look at is that when you charge your car from the grid you'll mostly charge it at night, and the carbon intensity of our grids, especially in Victoria, New South Wales and Queensland, is substantially higher at night. For example, over the last few nights in New South Wales 99 per cent of the electricity came from coal. We know that our hydro plants and our gas plants in New South Wales are used as peaking plants. And, of course, we have no solar at night. Also, it makes no allowance for the fact that when you turn the heater on in an electric car you use substantially more energy than you do in a petrol car. That is because in a petrol car the heat from your heater comes from the passenger engine, and in an electric car it is an almost purely electric heater. When you factor all those things in, there is simply no case for subsidies for electric cars in this nation.

The CO2 emissions, almost on a like-for-like basis, are higher in almost every circumstance. Even the good old Toyota Corolla, our most popular selling car, has lower emissions than a Tesla. I know the Chief Scientist says in his article, 'Oh, yes, but there's the Renault Zoe, which only emits 121 grams per kilometre.' But what he doesn't say is that Renault has another vehicle called the Megane, which is a petrol/diesel car that has lower CO2 emissions at 115 grams of CO2 per kilometre driven. We're often told that the future will be all electric. Earlier this week, we had the publication of the Annual Energy Outlook for 2018 from the US Energy Information Administration. It makes projections out to 2050, the middle of this century. They predict that plug-in electric vehicles in the US, by 2050, will only make up 14 per cent of the US passenger car fleet. Over 80 per cent of the vehicles—

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