Jon Sullivan (Longman, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Families, Housing, Community Services and Indigenous Affairs. How will the government support pensioners and low-income families as we move towards a low-carbon future? What challenges are there to this support?

Jenny Macklin (Jagajaga, Australian Labor Party, Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

I thank the member for Longman for his question. He knows, like everyone on this side of the House, that the government’s Carbon Pollution Reduction Scheme will help create a low-pollution future for Australia. It is certainly the case that Australians want action on climate change. Yes, it is the case that action on climate change will mean that things will have to change. Treasury modelling released earlier this year, and available on the Department of Climate Change website, recognises that the price of pollution will add around 1.2 per cent to the consumer price index over two years. Of this, household food prices could contribute around 0.1 per cent. The government has always been very upfront about this. We have made it very clear, including in legislation that has gone through the House of Representatives, that we will provide low- and middle-income households with compensation. Reports in today’s Australian newspaper suggesting that there is no compensation for households are wrong. Through a package of cash assistance, tax offsets and other measures the government will help these households maintain their standard of living while moving to a low-pollution future.

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

Mr Tuckey interjecting

Jenny Macklin (Jagajaga, Australian Labor Party, Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

I want to say, so at least one person up the back knows what this compensation is going to be made up of, that the government will increase pensions and other income support payments by 2.8 per cent over two years, including upfront indexation, to fully meet the expected overall increase in the cost of living flowing from the Carbon Pollution Reduction Scheme. A single pensioner will receive compensation of up to $504 over two years. A pensioner couple combined will receive $760 over two years.

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

Wow, that will go a long way!

Jenny Macklin (Jagajaga, Australian Labor Party, Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

I hear the member for Mackellar commenting, but she can wait until I get to what the opposition’s views are. Low-income families will also receive compensation to fully meet the expected overall cost-of-living increase. Family tax benefits will be increased, generally by 2.8 per cent over two years, an increase of up to $175 a child on the maximum rate. The low-income tax offset will increase by $430 over two years. So, in specific terms, a single-income family, on average wages—around $60,000 a year—with two children under 12, will receive $861 over two years in extra assistance.

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

Wow!

Jenny Macklin (Jagajaga, Australian Labor Party, Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

There is a lot of wowing going on from the member for Mackellar. You might wonder how much wowing went on in the Liberal Party party room when they came up with that report last week. If you have a look at the report they put out last week you will see that low- and middle-income households would be worse off because there would not be any compensation. Whether it is their policy or not of course we do not know—

Craig Emerson (Rankin, Australian Labor Party, Minister Assisting the Finance Minister on Deregulation) Share this | Link to this | Hansard source

Even they don’t know!

Jenny Macklin (Jagajaga, Australian Labor Party, Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

Thank you. They certainly don’t know. But the report makes it clear in black and white—tell it to the wow factor over there—that household compensation would be removed. That is what is in there. Do we hear any wowing?

Government Members:

Government members interjecting—No!

Jenny Macklin (Jagajaga, Australian Labor Party, Minister for Families, Housing, Community Services and Indigenous Affairs) Share this | Link to this | Hansard source

Under the Liberals—if it is their policy, which of course we do not know—families under the report that was released last week would be hit with higher costs but with no compensation. So maybe that is where this story has come from. The Liberal Party policy is to deliver no compensation to low- and middle-income households; by contrast the government will make sure that they are protected.

Luke Hartsuyker (Cowper, National Party, Deputy Manager of Opposition Business in the House) Share this | Link to this | Hansard source

My question is to the Prime Minister. I refer the Prime Minister to reports that the government’s flawed emissions trading scheme will result in an increase of up to seven per cent in grocery prices. Does the government expect consumers to pay more, farmers to receive less, or Australian food to be substituted with imports? Which is it, Prime Minister?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the honourable member for his question. The honourable gentleman may be referring to a report in today’s Australian newspaper, which I understand is in part—it may not be—derivative from an earlier submission from Woolworths, as I understand it, to the government’s public inquiry on the future of the Carbon Pollution Reduction Scheme. I would also draw the House’s attention to a statement which was put out by Woolworths this morning which says:

Modelling undertaken last year on the previously proposed scheme did show that food, like all goods, would incur a slight price rise. This price impact would be higher if agriculture was included but agriculture is omitted under the current plan. Woolworths submitted this information to the government in 2008 in order to assist with the compensation planning for lower income households.

Woolworths goes on to say:

Woolworth believes that the CPRS is necessary to effectively address climate change. Woolworth has already invested millions of dollars in sustainability initiatives that will reduce our energy costs and mitigate the impact of any scheme.

I would draw that statement to the honourable member’s attention. I would also draw to his attention the fact that the Carbon Pollution Reduction Scheme white paper was upfront about the projected impacts in terms of household costs. You cannot inject a new cost for carbon and pretend that it will not flow through to the general economy. It will. The key question is: how do you then compensate households in their dealing with that? That is why the government, through its regime, has proposed a way in which it compensates low-income earners, how it compensates middle-income earners and how it also assists motorists on the way through. That is a responsible course of action.

A responsible course of action is also to clearly outline what your industry assistance packages are in terms of how you seek to transition businesses, particularly emissions-intensive trade-exposed sectors of the economy, the coal sector and other critical sectors of the economy, from a higher carbon environment to a lower carbon environment. That is a responsible, balanced systematic approach to how you bring about this sort of fundamental policy change.

Can I suggest to the honourable member, as he represents the National Party, who are in fact the ultimate denizens of climate change denial in this place, together with certain well-known members of the Liberal Party who probably should be in the National Party when it comes to climate change, that what the nation requires of us is to put aside our partisan differences on this and begin to work together on climate change for the future, climate change on a Carbon Pollution Reduction Scheme. I note for those opposite that, in the debate which unfolded last week, after they released the Frontier Economics report, which they then disowned, they did not advance a single amendment. I think the Leader of the Opposition asked last week, ‘Why is the government not negotiating with us on the CPRS?’ I say to those opposite: how is it possible to negotiate if not a single amendment is advanced in the Senate? Not a single amendment. I could say to those opposite that the nation’s interests, economic and environmental, require a different posture on the part of those opposite both for this the renewable energy target and for the Carbon Pollution Reduction Scheme, because business needs certainty and we need to do our bit to bring down greenhouse gas emissions for the future.