Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Defence Personnel, Materiel and Science and Minister Assisting the Minister for Climate Change. Why is a responsible economic approach important in addressing climate change?

Greg Combet (Charlton, Australian Labor Party, Minister Assisting the Minister for Climate Change) Share this | Link to this | Hansard source

I thank the member for Makin for his question. The responsible economic approach to reducing carbon pollution is to use the most efficient and cost-effective abatement method and certainly not the costly, pick winners approach that the Leader of the Opposition has enunciated. There is no doubt that an emissions trading scheme represents the most economically responsible approach. It has been supported by all eminent economists.

Emissions trading and the market mechanism that it involves ensure that the cheapest methods to reduce carbon pollution will be the first to be applied. Many Liberals, including of course John Howard, the former Prime Minister, and the member for Wentworth, the former Leader of the Opposition, agree with this proposition. Indeed, so too on the record does the shadow minister, the member for Flinders, who has very cogently argued this position on previous occasions. As the Prime Minister adverted to in a previous question time, I think, in a 1990 university paper—it may have been his thesis, in fact—which was titled, interestingly, A tax to make the polluter pay, the member for Flinders had this to say:

… the market is the preferable regime as it better ensures that the polluter bears full responsibility for the cost of his or her conduct.

Good advice for the new Leader of the Opposition. In more recent times, the member for Flinders has gone further on the issue of emissions trading. Indeed, in a September 2008 address to none other than the New Zealand National Party, and also on subsequent occasions, the member for Flinders had this to say:

As the Coalition has long argued, Australia must introduce an emissions trading scheme.

That is the shadow minister’s position. He is also on the record as respecting the climate science and the need for emissions trading as I have adverted to. It is almost enough to make one feel a bit for him. He is now surrounded by climate change sceptics, he is taking economic instructions from Senator Joyce and he is putting his name to an economically irresponsible and environmentally unworkable coalition policy. He is putting a brave face on it, as he did at the National Press Club today, but I tell you what—it is compromising him deeply.

The coalition policy will not work. We already know that emissions will rise by up to 13 per cent over year 2000 levels under their plan. Their policy relies on costly subsidies for favoured projects. Yesterday I pointed to the analysis by Bloomberg that the abatement cost will be in the order of $64 per tonne. The Department of Climate Change analysis also suggests the carbon abatement cost per tonne will be in excess of $50. The Leader of the Opposition claimed it would be $15, I think, when launching the policy. It is completely uncosted and irresponsible economically, with a large burden on the economy. There is no obligation on large emitters of carbon pollution to reduce their emissions. Their proposal is going to put up prices. There is no compensation for pensioners and households. It is a totally economically and environmentally irresponsible position to adopt and it is already creating uncertainty for investment in the energy market because everyone knows a carbon price is coming and that it must be fixed by a market efficient method.

The truth is that many on the other side still agree with the government’s position. It is to be remembered that only 10 weeks ago a majority of the coalition party room supported emissions trading and supported the Carbon Pollution Reduction Scheme. The fact of the matter is that they remain deeply divided over this issue. I noticed in parliament the other day, when the member for Wentworth was giving his address on the Carbon Pollution Reduction Scheme legislation, the member for North Sydney came in to offer support. You should have offered your support when it really counted, when the national interest was at stake, and not been seduced by the media and by the urgers in your own party to be the third man and come last in the race. The important thing is to support economically responsible policy, but all of you, if you oppose the CPRS when it goes to the vote tomorrow, will fail that test.

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

Mr Speaker, I ask that further questions be placed on the Notice Paper.