Rob Mitchell (McEwen, Australian Labor Party) Share this | Hansard source

When we talk about the Safeguard Mechanism (Crediting) Amendment Bill 2022, we need to start with the first question. Why is it needed? Why do we need to have these bills? Because it's about our future and our kids' futures. It's about the No. 1 thing that we all should do as people in this place—to sit here and look at how we're going to make this nation better for the next generations.

We've gone through 10 years of climate wars that did not need to happen. They only happened because of the ideologues on the other side—not all of them, granted—that pushed against everything. We had the time when former prime minister Abbott claimed that there was a carbon tax, and we had every single one of those false statements put out about the words of then prime minister Gillard, even to the point where Peta Credlin admitted on TV that it was a lie. But they still keep holding to it. That's a real shame because, as I said, I know some of the people over there genuinely come to this place because they want to do better for our nation and our nation's future, and the most important thing we can do for our nation's future is to make sure that our kids and grandkids and the generations to come have an environment that's clean and safe and where we can actually have production of food and fibre and the things that we need to go forward.

I think it's fundamental that we should stand back and say, 'What are we doing now that is going to benefit our kids' futures?' because this goes to the crux of what this is all about. It's about doing things cleaner, greener and in such a way that we don't have as much impact on our environment. That's why we committed to reduce national emissions to 43 per cent below our 2005 levels by 2030 and to move to net zero emissions by 2050. This is about what's achievable and it's about what's realistic, but it's also about making us work to really have a deliberate and sustained effort to meet those targets, and every one of us has to play their part.

This is the way that we drive things forward. Let's move aside the absolutists who would have us do nothing at all or go all the way to where you can't actually do it. You've got to be practical. You've got to be sensible. One thing I agreed with the pessimistic member for Gippsland on was that we've got to bring people along. People need to be able to make change, see how it benefits them and see how it works. With every sector playing its part, we will be better off overall in terms of our environment and our kids' futures.

Our government's Powering Australia plan commits to build on the safeguard mechanism to reduce industrial sector emissions—something we know needs to be done. But it's about making sure that what we're doing is taking this country forward. For 10 years we've just wallowed in the pit of an inability to deliver positive steps for communities and for the nation as a whole. We want to take that technology, invest in what we can build and take that to the world. If we think back to the time of the former Howard government, PV cells were made and developed here—technology that goes around the world. But, because we had a government at that time that did not support the idea of renewable energy, that all went offshore. All that manufacturing, all those jobs, all that technology, went offshore, and we ended up buying it back. It's silly. We develop these things. We have the talent and the ability to do these things. But, unless we've got a government like our government that's actually on the side of people who develop technologies and who want to make a cleaner, greener environment, we're going to get nowhere. That's what we had for 10 years—constant fighting and bickering over what needs to be done.

Safeguard facilities are the country's largest emitters outside the electricity sector, contributing around 28 per cent of our total emissions. These reforms back in the climate commitments that companies have already made. These are steps that they're already taking. People are actually wanting do this. It's across industry wherever you go. People do want to have a better environment. They want to have a better future. By working with businesses and working with people, we can help meet our legislated national targets. The bill enables tradeable credits to be issued to facilities below their baselines. This provides an incentive for all covered facilities to reduce their emissions and access the lowest-cost abatement. We've had a broad coalition of business leaders and groups supporting the safeguard mechanism. This is because it will provide policy certainty for large industrial emitters.

What does the bill do? The safeguard mechanism will support and drive emission reductions from facilities covered by the safeguard mechanism. These reforms will help Australian businesses to remain competitive as the world decarbonises. We shouldn't be waiting. There is this theory on the other side: 'Let's not do anything. Let's just wait until others have done it. Then we'll start moving.' It's just wrong. You can't be international leaders if you're at the back of the pack. That's why we've got to be at the front of the pack. We've got to take the ability we've got through our science, through our manufacturing processes and through the skilled workforce that we have and will have for the future and utilise that best. Once we do that, the reforms will help Australian businesses to remain competitive and go forward as we continue through this 21st century.

The bill updates the objectives of the National Greenhouse and Energy Reporting Act 2007 to ensure net aggregate safeguard baselines decline—increasing industry and investor confidence to take action. That's the one thing that industry tells you—that over the past few years there's been nothing but instability in where we're going with our climate future, where we're going with pollution, because of all the chops and changes and the issues we've had during these climate wars.

This bill allows for the creation of a new unit type, a safeguard mechanism credit. The bill deals with matters like the issuance, transfer and ownership of the credits from facilities which beat their baselines. Credits will provide an incentive for all facilities to reduce their emissions if they have cost-effective opportunities—helping to deliver Australia's climate targets at the lowest cost. The bill also allows rules to be made about interactions between the safeguard mechanism and the Emissions Reduction Fund. This will support the integrity of both the safeguard mechanism and Australian carbon credit units. The detailed design of the safeguard mechanism, such as how baselines are set, will be in subordinate legislation referred to as the safeguard rules. The draft safeguard rules were released for consultation on 10 January this year.

The key reasons for these reforms are quite simple: we now have legislated emissions reduction targets, and the safeguard mechanism is a central policy to delivering our targets—announced in December 2021 as part of our Powering Australia plan and endorsed at the last election by the Australian people. This is the key: we took this to the election and we've received a mandate to do this, because the overwhelming majority of Australians want action on climate and they want action for our kids' future, whether it's through emissions reduction to remove the pollution from our air or whether it's about cleaning up waterways so that we've got cleaner water to run through our nation. That's why we've got to look even at things such as cleaning up the waterways so that our native fish can thrive. We need to do that through carp eradication programs, for example, as a way to do something positive to bring a better future for our kids.

These safeguard reforms are expected to save around 205 million tonnes of emissions in the period to 2030, which is the equivalent of taking some two-thirds of Australian cars off the road in the same period. Reforms to the safeguard mechanism have been consistently recommended and supported by businesses and business groups, including the BCA, AIG and ACCI. They're people that normally are probably not on our side of the fence; I guess that would be the thing we'd say. But they're businesses, and businesses know where the future's heading and why they need to be part of that. That's why they support these mechanisms: to be able to actually get a pathway forward and deliver better outcomes, something that we need to stop the climate wars that we've had for the last 10 years.

We know those opposite had grand plans for the safeguarding credit they announced back in May 2020 with their King review response in the May budget of 2020-21. In their crediting consultation paper in August that year and their long-term plan in October 2021, they put forward these reforms, which they never delivered and now oppose. I think that's been the key thing that we've learnt from this: we now have an opposition not only opposing the government's views but opposing their own views, a rather bizarre set of circumstances.

This is why we've got to bring these things forward and move this Safeguard Mechanism (Crediting) Amendment Bill through to get things done, because, after the decade of delay, denial and absolute dysfunction, all we have to hear is a half-baked scare campaign. We heard that through the previous speakers: 'I fear, I fear, I fear.' It is not about any positive plan or any way to actually address the issue that Australians want. It goes back to the standard 101 of the conservatives, and that's to run a fear and smear campaign, with no basis other than that they're planning to oppose everything.

When we look at what's happening, we see that 80 per cent of our facilities, representing 86 per cent of covered emissions, are already covered by the corporate net-zero commitments, because businesses know reducing emissions is essential to their long-term competitiveness in a global net-zero economy. We see that around the world with manufacturers who package stuff, send it overseas and then require the packaging to come back, to make sure that we re-use, recycle and cut our emissions globally.

When we're looking at around 215 large industrial facilities, accounting for around 28 per cent of Australia's emissions, the importance of this is to make sure there's integrity involved. We commissioned an independent review, the Chubb review, to ensure that carbon-crediting frameworks have integrity and maintain a strong and credible reputation. The expert panel concluded the arrangements are sound. The panel found there are appropriate checks and balances in the scheme, the methods and the projected level to protect the integrity of the scheme and the credits created underneath it. The panel made sensible recommendations to ensure the scheme aligns with modern expectations of best practice, including separating the functions of integrity assurance, regulation and administration; maximising the transparency of the scheme information; encouraging innovation in the method development and project implementation; and supporting greater participation, including by First Nations communities.

The government has agreed in principle to the 16 recommendations of the review and is working with its stakeholders on its implementation. We need to know that emissions from covered sectors are among the fastest-growing across the economy, and are projected to overtake emissions from the electricity sector if we don't take policy action. Reducing emissions from safeguard facilities is therefore a crucial part of meeting our climate goals and maintaining Australia's industry and competitiveness in a decarbonising global economy.

We released our proposed reforms on 10 January this year and imposed comparable requirements to the commitments and actions of other countries at sectoral and whole-of-economy levels. Our reforms would see Australia's largest industrial emitters take a proportionate contribution to meeting our target by reducing facility baselines by 4.9 per cent each year between 2024 and 2030. This means that, on average, safeguard facilities reduce their emissions to the same rate as the rest of Australia's economy in 2030.

The important message to start with and lead with is that this is a sensible approach. You can't take the absolutist views of the Greens, who want to do everything but can deliver nothing, or of the opposition, who, after 10 years of infighting and plans all over the place, left us in a worse position than what we started with. We need to continue on a sensible, safe and intelligent path to meet our emissions targets, but to do that with business and with communities. The only way we do this is by ending the scare campaigns, ending the internal fighting across the chamber and starting to focus on the nation, not ourselves.

I absolutely support this bill, and look forward to it having a speedy passage through this place.

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