Harry Jenkins (Speaker) Share this | Link to this | Hansard source

I have received a letter from the honourable member for Flinders proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The imminent risk to Australia of the government's decision to delegate the carbon tax to an unelected committee.

I call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the standing orders having risen in their places—

Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Action, Environment and Heritage) Share this | Link to this | Hansard source

It has come to this: on a day when the Prime Minister proudly tells the Herald Sun that her contribution to helping the planet is to run the pool pump at the Lodge at least one hour less per day, she refuses to rule out a petrol tax on the Australian people. It has come to this: on a day when the Prime Minister also tells the Herald Sun that her contribution to protecting the planet is to buy local fresh and in-season fruit and vegetables when in residence at the Lodge—and you can just imagine her down at Coles Manuka pushing a trolley in the tracksuit pants before going back to what the Minister for Foreign Affairs politely calls 'Boganville'–the Prime Minister of Australia is announced to be contemplating an unelected citizens assembly of one, with maybe a few friends, to determine Australia's taxation policy and the tax rates on petrol, electricity, gas, groceries, automobiles and housing.

On this day, when the Prime Minister is happy to talk about running the pool pump at the Lodge for one hour less, when she is happy to talk about an occasional trip to Coles Manuka to pick up a few fresh fruit and vegetable items, she is contemplating an unelected citizens assembly of one, with maybe a few friends, to determine the tax rates for electricity, petrol, gas, groceries, automobiles, housing and the cost of farming and food production in this country. That is what we are seeing in terms of the democratic deficit in this country on this day in this place. That is why this matter of public importance is important, because it is about the imminent threat to Australia in both our economic health and our democratic health.

There are two great democratic threats in the way in which the government is approaching this carbon tax. The first is about participation. What we have is a principle, which the government will not renounce, of allowing unelected officials to set tax rates on the most basic, essential items for this country. Call me nostalgic, but I seem to remember that the Boston Tea Party focused on the issue of taxation without representation. That small principle of taxation without representation has a reasonable heritage in Western parliaments around the world. It was rejected 240-odd years ago and it has been rejected ever since. This government is unable to make a decision and form an agreement with its alliance partners and puppet-masters, the Greens. It cannot make a decision, so it seeks to refer responsibility for a most basic decision on taxation to an unelected committee, effectively a citizens assembly of one or two or three, that can determine the tax rates that Australian families will pay for electricity, petrol, gas, groceries, houses and automobiles, amongst many other items. This is an abrogation of responsibility. The nature of governance, the purpose of a prime ministerial role, the task of a parliamentarian, is to allow the people of Australia to have a voice and have a role in and a responsibility for determining the rates of taxation of this nation and their impact on households so they can determine, through their representatives, the effective prices that they will pay for goods and services and the effective rates they will pay through taxation.

We are at a critical and extraordinary moment in Australian political history, where an unelected body has been proposed and a prime minister is refusing to rule out the creation of an unelected body with effective control over the taxation rates of essential services. As I say, for over 240 years the Western world has been somewhat suspicious of taxation without representation. What we are seeing now is a policy where the government is refusing to rule out accepting, acknowledging and endorsing a committee which would effectively take power away from this parliament and disenfranchise the people of Australia over a fundamental decision. I repeat: the reason is that the government has no authority. It is a government which is fundamentally lacking in authority, lacking in legitimacy and lacking in the capacity to implement its own decisions. It is not in control of its own destiny; it is certainly not in control of the country. In order to resolve an internal alliance matter with the Greens, the ALP—the government of Australia, the Prime Minister of Australia—are contemplating ceding sovereignty over taxes to an unelected body. That is what it has come to in this parliament on this day.

We make it clear that this is an imminent threat to Australia. I make the point that the democratic deficit operates firstly in terms of participation and secondly in terms of truth. In terms of participation, the most fundamental right that an Australian citizen has is to make or break governments on the basis of the policies they take to an election. All members of this House will remember that the government of today, led by the Prime Minister of today, went to the election with the Prime Minister stating on the Monday prior to the election:

There will be no carbon tax under the government I lead.

That statement could not have been more categorical, and it was made in the context of an opposition campaign to say that there would be a carbon tax. It was not a casual statement; it was not a chance statement. This was the primary issue of the day because we foresaw that, whatever happened in the House of Representatives, a deal would have to be done in the Senate which would bring on a carbon tax as a consequence of the government's relationship with the Greens. This was foreseen, the government was forewarned, but it was denied by the Prime Minister and by candidates seeking a mandate from the people of Australia to carry out policies. This happened not just once. On the day before the election, the Prime Minister said on the front page of the Australian:

I rule out a carbon tax.

The question has to be, why did she say that? What was there to lead her to object so much to the term 'carbon tax'? The Prime Minister said that because she knew that the Australian public would not endorse her, would not endorse her government and would not allow her to form government if she advocated a carbon tax, because it conveyed to the Australian people, in the words that the emissions trading scheme did not, that the people would pay in terms of higher prices for electricity, petrol, gas, groceries—all the essentials of life. It was an act of fundamental dishonesty on a critical issue at a critical juncture. It was an act of betrayal of the Australian people because it was fundamentally dishonest, and every member of the government today knows that.

The reason the Prime Minister said 'I rule out a carbon tax' is that she knew that, if she did not, she would have lost the election. So she went to the election on a grand deception—a deception of the Australian people which goes right to the heart of legitimacy. And lest it be said 'we always intended a carbon price', the government's policy in the weeks leading up to the election was, firstly, no carbon tax and, secondly, a citizens assembly to produce—I remember the words clearly—a deep and lasting consensus. I suspect there has not been a deep and lasting consensus in favour of the carbon tax at this stage. Thirdly, and this is my favourite of all the policies, there was cash for clunkers. Cash for clunkers had a half-life of about three hours, before everybody realised it would produce emission savings at about $400 per tonne. They were the official election policies.

The democratic deficit is real, and there should be a chance for the Australian public to genuinely vote on who determines the taxes Australians face, who determines the circumstances under which they pay those taxes and who determines what those taxes will be. This government went to the election denying that there would be a carbon tax and it should now take the proposal for a tax to an election. Anything less than that will be a travesty of the democratic process, a betrayal of the Westminster system, and will be a simple insult to the ordinary working families of the Australia, who deserve to have the trust placed in them to make their own decisions about their own future.

The second great democratic issue at stake in this debate right now, when it is proposed that unelected officials be given the chance to levy taxation on Australian families, on Australian pensioners, on Australia farmers and on Australian small businesses, is the issue of truth. The government has told us that families will be no worse off. The government has told us that it is all some mythical 1,000 companies. But let me quote from the Garnaut report today:

Australian households will ultimately bear the full cost of a carbon price.

Elsewhere in the report there are words to the effect that in the long run households will pay almost the entire carbon price as business passes on the costs. Those statements are both true. This system is designed to increase the cost of electricity; it is intended to increase the cost of electricity; its sole purpose is to increase the cost of electricity. And it will do it. It will do it over and above any other effects, and we do not walk away from that. But it will increase the cost of electricity.

Lest it be said that we are quoting our own material, Treasury's modelling has talked about an $863 increase in the cost of living for families under a $30-per-tonne carbon tax. No matter where it starts, no matter what games they play in the first year, the impact will be a rise every year. The Garnaut report today confirms that there is an escalator that will continue for many years.

Petrol will go up by 6.5 cents a litre. And if they play an offset game in the first year, what the Garnaut report also confirms, and the Prime Minister would not deny today, petrol indexation is effectively back. Every year after year one petrol will go up, and they cannot deny that. They must rule out increasing the cost of petrol.

Gas will go up by 10 per cent. Groceries will go up by 5 per cent, according to the Australian Food and Grocery Council. Then there are the impacts on business, which are very simple. Let me give you an example that I think sums it all up. The cost of an Australian made car, according to PricewaterhouseCoopers, will increase by up to $412 per vehicle. The cost of a foreign vehicle from China, Japan or Korea will not change at all. How can it be that an Australian made vehicle will increase by $412? There are members from South Australia in this chamber and I ask them: do you think it is acceptable that an Australian made vehicle goes up by $412 while a foreign vehicle does not increase in price by one dollar? That goes to the heart of the flaws in this model and this approach. What they are saying is that we will increase the price of Australian made goods while imported goods are not penalised. Again, lest it be said that this was our work, this is the work of PricewaterhouseCoopers, and they have built on the findings of the National Farmers' Federation, which only yesterday said that there would be a $36,000 increase on a Western Australian wheat farmer at a carbon price of $36-per-tonne. The cost of food will go up and the profitability of farming will go down but the cost of imports does not change. That is the critical element that this government will not acknowledge.

On the same day, the government has withheld the Productivity Commission report into the impacts and approaches to dealing with carbon pricing in other countries. The reason is that they are ashamed of it, and they want to release it out of the parliamentary session. So, they are willing to leak the fact, as they did overnight, that they are happy to have a new citizens' assembly of one or two or three to determine the taxation rates, but they are not willing to release the work of the Productivity Commission in this parliamentary session so that we can talk about the real action occurring around the world, whether it is in China, the United States, Japan or Canada. That is the democratic deficit that is occurring.

Also, let me make it absolutely clear that the cost of a house, according to the Housing Industry Association, will go up by $6,000. Against all of that background—electricity, petrol, gas, groceries up $863 a year, Australian made cars going up by $412 whilst foreign cars from North Asia do not increase by a dollar at all—what we see here is a plan for an advertising campaign, with no plan to protect the Australian economy, and a plan for unelected officials to determine the taxation rates in Australia. It is time for the Australian government to stand up for Australia and reject this tax and adopt a better way that will not drive up the cost of living for Australian families. (Time expired)

Mark Dreyfus (Isaacs, Australian Labor Party, Cabinet Secretary) Share this | Link to this | Hansard source

The member for Flinders has raised this matter today because what he fears most in this current debate is any independent voice on what the science of climate change means for Australia's efforts to reduce its own pollution. What we have heard today is a ringing independent voice, that of Professor Ross Garnaut. Professor Garnaut is, I repeat, an independent voice, and that is what the opposition cannot stand about the report that he released today. I add my thanks to those the Prime Minister expressed earlier today in question time to Professor Garnaut for the continuing excellent service he has rendered to our nation over the course of his working life.

This debate today is not, as the topic chosen for it by the member for Flinders might suggest, about the role of government. It is not about the role of parliament, which will continue to be the body that has responsibility and accountability for the legislation that it makes. It is grossly misleading for the member for Flinders to come into this House and make any suggestions about what the government is proposing to do in relation to the carbon price scheme that we will be announcing in the middle of the year and introducing legislation for later in the year. It is grossly misleading for him to have made the suggestions that he has made about what the government is proposing.

The fact of the matter is that the opposition is fundamentally opposed to any climate change policy that achieves the long-term reductions in pollution that we need to make. As outlined in his recent interview on the 7.30 Report, the member for Flinders has admitted that his polluter subsidy policy is only a temporary solution that has nothing to offer Australians for the long-term adjustment that Australia needs to make. The coalition's policy will not make a dent in Australia's emissions and fundamentally ignores the economic transformation that our nation needs to make. Far from being a long-term vision, which is what one might expect from a mainstream political party, the coalition's policy is a fig leaf to convince the sceptics who sit opposite and make up a large proportion of the coalition parties that, in proceeding with the direct action policy, they have committed only to a pot of money that can be quickly reallocated and abandoned once they gain power. As outlined by Professor Garnaut today, direct action is immensely more expensive than a price on carbon. To make it clear what our policy is, the carbon price that we aim to introduce in this country is a price on pollution, which will make dirty energy more expensive and clean energy like solar, gas and wind cheaper. The carbon price will apply only to the biggest polluters in our economy—fewer than 1,000—and they will be required to pay for every tonne of carbon pollution that they emit. It is the most effective and the cheapest way for us to build a clean energy economy and every single reputable economist has said that, in comparison to the fig leaf of a direct action policy that the coalition has put forward, it is absolutely clear that putting a price on carbon, a market mechanism, is to be preferred.

I do need to make clear what the governance arrangements for the carbon price might be—first, by making clear that those governance arrangements are still under consideration by the Multi-Party Climate Change Committee. No decisions have been taken on aspects of governance, which are those that have been raised in this matter of public importance by the member for Flinders today. All details will be announced once the deliberations of the Multi-Party Climate Change Committee have been finalised, but it is apparent that it is necessary to correct a complete misconception that has been advanced today by the member for Flinders not about the government's proposal, not about what has been decided in the Multi-Party Climate Change Committee but about Professor Garnaut's proposal for an independent committee.

Sussan Ley (Farrer, Liberal Party, Shadow Minister for Childcare and Early Childhood Learning) Share this | Link to this | Hansard source

Three committees.

Mark Dreyfus (Isaacs, Australian Labor Party, Cabinet Secretary) Share this | Link to this | Hansard source

I am corrected by the member for Farrer, who says that Professor Garnaut in his report recommended as part of his proposed governance structure for the carbon price scheme some three independent bodies. But the particular independent committee that the member for Flinders has directed his attention to is one which, in his imagination, was going to set the price. I need to make clear—and I invite the member for Flinders to actually read Professor Garnaut's report before he next raises this, and perhaps other members opposite could read Professor Garnaut's report before they raise these sorts of allegations—that the independent committee as proposed by Professor Garnaut would not set the price. It is proposed that it would make recommendations on emissions reduction targets and that those emissions reduction targets would remain the prerogative of the government. The independent committee would not be setting the carbon price, because under the emissions trading scheme which we will be moving to after the fixed price period is completed it would become a market price.

Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Action, Environment and Heritage) Share this | Link to this | Hansard source

The target sets the price under the ETS.

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

The honourable member has had his opportunity. I counsel him to remain silent.

Mark Dreyfus (Isaacs, Australian Labor Party, Cabinet Secretary) Share this | Link to this | Hansard source

Thank you, Mr Deputy Speaker. The independent committee would make recommendations to government and parliament concerning the implementation of targets under emissions trading. It would be up to the government and the parliament to respond to these recommendations.

Despite Professor Garnaut making this crystal clear in black and white in his report, the coalition has wilfully misrepresented what he has proposed. We have heard it again just now from the member for Flinders. The member for Flinders seems to be suggesting that the entire carbon tax, including the carbon price, and carbon pollution reduction targets would be outsourced to unelected officials—indeed, he has just used that phrase, referring to unelected officials setting tax rates. That is a wilful misreading of this parliament and it is not what Professor Garnaut said today in his speech, it is not what he said in his report and it is not what he said in the summary of his report. I read to the House what Professor Garnaut says:

… some of the governance functions related to the scheme, are by their nature, the prerogative of Government. These include decisions about establishing the scheme, setting the medium and long-term emissions reduction targets, deciding which sectors should be covered by the scheme; the broad principles for providing transitional assistance to emissions intensive, trade exposed industries, and the principles governing the point at which the scheme should switch from a fixed to a floating price.

It is very clear, Professor Garnaut goes on to say, that the ultimate decision on recommendations put forward by the independent committee that he is proposing lies with the parliament. That is what he says:

Should the Government wish to take an approach that differs from the Independent Committee's recommendations, it would be required by legislation to present to Parliament the reasons for its alternative decision.

This approach is similar to the arrangements for setting carbon budgets or national emissions reduction targets in the United Kingdom. That is right: this is the approach that is followed by the Conservative led government in the United Kingdom, and that is why those opposite are so keen to misrepresent the proposal from Professor Garnaut. By the way, this is the same United Kingdom government, now led by the Conservative Party, which is continuing with the emissions trading scheme that has been established in the United Kingdom since 2002. It is the same Conservative led government which just two weeks ago adopted the most ambitious emissions reduction targets of any developed country. To make it clear what those are, it is a pledge, under the annual carbon budget adopted by the United Kingdom government, to cut emissions from 1990 levels by 50 per cent by 2027. It ought to be an embarrassment to those opposite that a Conservative led United Kingdom government, in a bipartisan fashion, has simply continued with the emissions reduction policies of the former Labour government. It has continued with the scheme. It has indeed adopted more ambitious targets. The suggestion which was made to us yesterday in this House that the United Kingdom government has said that there is going to be a review in 2014 is simply appropriate, cautious government. It is the appropriate, cautious government that would be brought by our government to bear on any emissions trading arrangements that we introduce, because the national interest must come first. That is why we are introducing an emissions trading scheme after a fixed price period, that is why we are moving to a carbon price, because it is in the national interest that we do so. The review update from Professor Garnaut could not have been clearer. This is the report that Professor Garnaut released today. Making it clear, he said that climate change is real, it is caused by human activity and it poses a serious risk to the prosperity and quality of life for all Australians. He said:

Since 2008, advances in climate change science have … broadly confirmed that the earth is warming, that human activity is the cause of it and that the changes in the physical world are likely, if anything, to be more harmful than the earlier science had suggested.

It is a view that is based on the advice of expert climate scientists. It is consistent with the advice that the government has received from sources like the CSIRO, the Bureau of Meteorology, the Climate Commission and the Australian Academy of Science. Of course, just last week the Climate Commission released its report, entitled the The critical decade. Any serious government—indeed any serious political party—has a clear responsibility to act in the national interest and, consequently, cannot ignore advice of that kind. Only an opposition which is more concerned with its own political self-interest than the national interest would choose to ignore such advice.

I will say again, as was said several times in answers in question time, that Professor Garnaut could not have made it clearer that the appropriate response to the challenge of climate change is a market based mechanism. It is the introduction of a carbon price and it is not the so-called direct action policy that those opposite seem to favour. This is what Professor Garnaut said in his speech today about direct action: 'Direct action, or reducing carbon emissions, is likely to be immensely more expensive than a market approach.' That is consistent with the views of all mainstream economists.

Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Action, Environment and Heritage) Share this | Link to this | Hansard source

That's not true. There are three Nobel laureates who disagree.

Mark Dreyfus (Isaacs, Australian Labor Party, Cabinet Secretary) Share this | Link to this | Hansard source

It is consistent with the views of former Liberal leaders. As has been accurately said, the only living leader of the Liberal Party, past or present, who does not support a price on carbon—

Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Action, Environment and Heritage) Share this | Link to this | Hansard source

That's not true either—Downer.

Mark Dreyfus (Isaacs, Australian Labor Party, Cabinet Secretary) Share this | Link to this | Hansard source

Oh yes, Mr Downer, apparently. I have not heard from him.

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

Order! The honourable member for Flinders will restrain himself.

Mark Dreyfus (Isaacs, Australian Labor Party, Cabinet Secretary) Share this | Link to this | Hansard source

But what has been made clear is that John Hewson favours a price on carbon. Malcolm Fraser favours a price on carbon. Malcolm Turnbull, the member for Wentworth, favours a price on carbon and the former Prime Minister John Howard favours a price on carbon. That ought to give a pretty clear message, one would think, to those opposite that they are definitely proceeding on the wrong track with their direct action policy.

I want to again commend Professor Garnaut for the great service that he has done to Australia with the update of his 2008 report. In the report that he released today he made very clear points, one of them being that in mainstream science the expectations of what will happen if we 'let emissions rip', to use Professor Garnaut's phrase, have become a bit more grim. A second point, and it is a somewhat optimistic point that Professor Garnaut made today, was that technology is advancing faster than expected. He gave us the example of the take-up rate for electric cars. The third important point that Professor Garnaut made today was that the case for action is stronger than it was a few years ago. We should have acted much earlier than we have. With every year that passes the cost of taking action will grow, and that is why it is important that we proceed now with as much speed as possible to introduce a carbon price in Australia, starting on 1 July next year with a fixed price.

This is a reform which is in the national interest. It is a reform which will see Australia doing our fair share. It is a reform in which we will be able to show the rest of the world how to reduce emissions and, by doing so, urge the rest of the world—because we need the rest of the world to act—to reduce their emissions. It is a reform which will let us move our economy towards the low-carbon economy of the future, towards the clean energy of the future. We will withstand pressures from sectional interests because it is in the national interest that we continue to do so. (Time expired)

Sussan Ley (Farrer, Liberal Party, Shadow Minister for Childcare and Early Childhood Learning) Share this | Link to this | Hansard source

I am delighted to speak on today's matter of public importance, the imminent risk of the government's decision to delegate the carbon tax to an unelected committee. Since the government is determined to quote Professor Garnaut, we should put one of Professor Garnaut's quotes front and centre in this debate—that is, that 'Australian households will ultimately bear the full cost of a carbon price.' We already know that a carbon tax will attack the living standards of forgotten Australian families and households.

I received a letter this week from a young mum in Kalgoorlie, Western Australia, where the Treasurer believes our two-speed economy is going at full throttle. This is a young mum who wants to get back into the workforce, but is worried about the skyrocketing cost of child care and about being able to give her family all that she hopes and dreams of. So what is the Prime Minister's response? She is going to hit her with even higher costs of living. For starters, a $20 to $30 per tonne carbon tax will raise power bills by 25 per cent. It will add 6½c to the cost of a litre of petrol. Up go grocery prices by five per cent—and that is all just for starters because Labor's shaky, flaky single-issue partners in government, the Greens, say the tax must be $40 a tonne to drive change from coal to gas. Then it would have to go to $100 to drive the change from fossil fuels to renewables. We know that that is exactly what the Greens want to do. I am at a loss as to how I should respond to Tanya from Kalgoorlie, but I might also add that she wrote at the end of her email: 'I would have written this letter to the appropriate minister from the ALP, but it has become very clear that the Labor Party is not listening to middle-income Australia.'

Labor set the tone for the debate on unelected committees in the last parliament, when they kicked off with the 2020 Summit. Having sneaked into government with 97 per cent of the former government's agenda, they had to bring a summit to Canberra to tell them what they had to do. 'We're not sure of our agenda. We've sneaked into power. What should we do?' The citizens assembly is another example of this. It popped up during the last election campaign. It was to consist of 150 members from across Australia, one from each electorate, and we pointed out to the Prime Minister then that we already have such an elected assembly in parliament. But again it was an initiative designed to tell the government what to do and what to think. Wind the clock forward to the Murray-Darling Basin debacle. The government flicked the development of a basin plan to the Murray-Darling Basin Authority, absolving itself of responsibility for the outcome, and kept referring to the Murray-Darling Basin Authority as the independent authority. What a mess! Members of this parliament, in a committee chaired by the member for New England, have had to travel around the basin, picking up the pieces and cleaning up the mess because, again, we saw the decision making of this parliament hived off to an independent committee. We had to bring the decisions back into the parliament where they belong.

We now have a proposed independent committee to set Australia's emissions reduction level, to break the deadlock between the Labor Party and the Greens, and to resolve the hissy fits of the Prime Minister and Senator Bob Brown. Professor Garnaut's final carbon price report is quite prescriptive. There is $11.5 billion—55 per cent of which goes to households and 35 per cent to businesses. It will be budget neutral. There will be tax cuts and a tax-free threshold. Pensions might be indexed. Petrol taxes are in the mix. Transitional assistance will be provided and so on. No fewer than three independent bodies will be set up to implement it—one to tell us what our future targets and scheme caps should be, another to tell us what assistance should be provided to trade exposed industries and a third is the carbon bank to administer the final emissions trading scheme. But if the government disagrees with recommendations then it has to come back to parliament and so on. The problem here is not the existence of sound, independent organisations to manage whatever disastrous policy emerges from this mess. The problem is the referral, handballing and dumping of the decision making that belongs in this parliament to outside bodies.

Like many, I watched the Garnaut National Press Club address today and paid particular attention to the questions. During the questions, Professor Garnaut was asked: 'What target would the independent committee set? Would it be more than five per cent?' His answer was: 'Well, the independent committee would look at this in more detail. It would have the resources on the job to do it properly. It would have a whole seven months to do it.' So one can only conclude that the independent committee might well set a target of greater than five per cent. The point of this is not so much the five per cent target but the clear impression that the responsibility for the setting of the target does not lie within this parliament but lies with one of these three independent committees. Do people really think that if the committee that determines a target of more than five per cent does not have its advice taken by the parliament that all of the other work that is being done by independent committees outside this place would stand up? It would not. To me, that is a strong indication that this government is devolving responsibility to a body that is not elected. Every other piece of advice or decision hangs off that target. The Prime Minister needs to 'fess up here. She has no idea what to do with this train coming down the track.

I represent a rural electorate, like many members in this place. I refer now to the Australian Farm Institute report which says that the impact of a carbon price on Australian farm businesses—the case I am going to use is grain production—is going to be quite devastating. The proposed carbon price mechanism will increase the price of energy and hence the cost of farm inputs that involve the use of energy in their production or delivery. It does not matter how many tax offsets or structural adjustments you put in. It does not matter whether agriculture sector emissions are in or out. The on-farm costs will rise and, for my own electorate, disturbingly so. The report notes the impact of a carbon tax will be relatively greater for the smaller New South Wales farmer, with the lower productivity of a modest sized grain farm hit harder by the rise in costs. This simple report comes up with the figures the government apparently needs a full-blown committee to consider. Even at a modest carbon price scenario of $20 a tonne, this would add $15,000 to the bottom line of this farm business. Farmers have enough to cope with—droughts, floods, locusts, mice and the scourge of other things that they face—without adding the carbon tax.

As I said, the Prime Minister has no idea of what to do with the carbon tax problem. But what the coalition says to this government is that, no matter how many independent committees, expanded government bureaucracies, experts or actors you wheel out to ram your message down the throats of the Australian people, nothing is going to substitute for your government's shocking leadership, the incompetent way that you have managed this debate, your muddle and your confusion. The simple truth is that the government's carbon tax will impose excessive deadweight costs on the Australian economy. A carbon tax will increase the cost of living. It is, most disturbingly, a tax which is actually designed to go up as soon as it commences. It will transform into an emissions trading scheme down the track. It will start as a carbon tax at some level yet to be set—the mystery will be revealed by the multi-party committee—but as soon as it is legislated it is designed to go up. Compare that with the GST where checks and balances and legislation were put in place and agreements were made to make sure that that did not happen. This is a tax that by its very design will go up the minute it hits the pockets of everyday Australians.

The government is not brave enough to put its stamp on this tax. It is not brave enough to bring the decision making that it should be doing across the parliament inside the parliament. Instead, it is hiving it off to a committee of unelected people that will have, as the member for Flinders pointed out, extraordinary power. The wide-ranging discussion we heard at the Press Club indicates that Professor Garnaut's committees will have their fingerprints all over all sorts of aspects of government policy, particularly tax, pensions, FBT and fuel prices. How could they possibly get it right? How could they possibly make it budget neutral in the end? I do worry, as I said, about those deadweight transaction costs with money moving around the economy. Who knows where it will end up?

If the Prime Minister wanted an actor to help get the message across, she would have been better off choosing Chopper Read than Cate Blanchett because Chopper Read was quoted in the press on the same day as Ms Blanchett and Michael Caton saying, 'Look, I just make it up as I go along.' It appears that the Prime Minister and this government are also making it up on this topic as they go along.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

At the outset, I agree with the member for Flinders in one aspect of his contribution to the House today—that is, we are at a critical point. We are pressed to do something of paramount generational importance, and that is to tackle the influence of climate change—an issue that on their side they grappled with for years. They ignored public pressure to deal with what the public wanted to see: support for Kyoto, support in tackling climate change and some sort of action taken for the sake of future generations. They comprehensively failed to do anything until the last moment when their former leader, John Howard, agreed that they would need to do something and support an emissions trading system. He was ultimately required to face the grinding weight of facts and the compelling case to act. Again, it is worth noting that 2010 was one of the warmest years on record. The previous decade was one of the warmest. The graphs recording movement in temperature might bounce up and down but the trend line is undeniably moving upwards. The turning point for us—

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

It is getting warm in here.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

Is it warm in here? Well, from the hot air that comes from the other side it does not surprise me that you would feel that way. The turning point was the election of the Leader of the Opposition whose strident opposition has caused splintering, forcing people to argue against the very things they strongly believe in. In particular, the member for Flinders, whose own academic work declared support for a pollution tax, is now forced to advocate for a pollution subsidy. One of the good things to come out of the 1990s was the work of the member for Flinders in which he advocated some sort of pricing mechanism, through a pollution tax, that he now argues against in this House. We have two of the more moderate and reasonable people from their side advocating immoderate and unreasonable positions through the course of this debate, knowing full well in their heart of hearts that they cannot ignore the fact that we are required and almost compelled to do something.

You have to be astounded by the gall of the opposition who come here as the defenders of democracy, who come here as the advocates for mandates, who wring their hands on the issue of cost of living, and yet where was all this when they up-ended the lives of workers and brought in Work Choices. They never went to an election advocating or indicating in any way, shape or form that they would be rampantly introducing individual contracts, stripping away penalty rates, squeezing overtime and putting pressure on working families. They never came in here and said, 'This is what they were going to put forward at the next election.' Now they come here as if they have discovered the virtue of mandate, that they have discovered in some way, shape or form the importance of a democracy and of being upfront and transparent. Yet, they seek to demonstrate this line here today.

We asked them, given that this matter of public importance is talking about the way we intend to approach this whole issue of dealing with climate change, to be involved in the Multi-Party Climate Change Committee. They had a chance to be involved and they refused. Why? Because they wanted to be able to sit on the sidelines and do whatever they could to support the position of Leader of the Opposition to not undertake any sort of comprehensive action on climate change. What they wanted to do was to sit outside the process, and yet when invited to have an input and to put forward the issues that they now claim they are most concerned about, they did not do it. We now have an opposition that are effectively cast in the scientific Dark Ages. While the frontbench makes lukewarm support for the science, you have some incredible comments being made by people in a position of responsibility who should know better. They say, for example, that they do not know whether carbon dioxide is quite the environmental villain that some people make it out to be—and that comes from the Leader of the Opposition. While the member for Flinders and the member for Wentworth will, with their hands on hearts, say that they do accept the science, their own leader is unable to comprehensively say that he accepts that the earth is getting warmer and that something needs to be done about it.

At the back we have people like the member for Tangney, Senator Minchin, Senator Joyce and Senator Boswell—this column of sceptics—and the Leader of the Opposition is unable to articulate or form any sort of comprehensive policy on this because they are out there white-anting the coalition in coming forward with some sort of meaningful, durable way of dealing with this issue of climate change. They remain on the outer because they have put themselves there in an effort to wreck any chance of being able to form the type of community consensus that is required on this pressing issue. Amazingly, stunningly, as part of this scare campaign, they are out their misleading the public as to what the impact would be and they doing so in quite an economically illiterate campaign.

They have been picked up on this. Lenore Taylor of the Sydney Morning Herald dissected this quite neatly after the Leader of the Opposition visited a butcher store in Coffs Harbour as part of the annual charity bike ride that he did down the eastern seaboard. He stopped into a butcher's shop and he said that the carbon tax would contribute $4,000 to the energy bill of that butcher. The journalist then went back into the butcher's shop and asked if this was the case. They said, yes. Then they were asked what impact this would have on their turnover and their prices. The butcher said the impact would be, for example, that for a kilo of T-bone that costs currently $22, the price would move, stunningly, up to $22.04. On a kilo of mince it would move from $11 to $11.02. This scare campaign is unable to deliver the facts. We had previously demonstrated under other potential options that grocery prices, on average, might move from 80c to $1.30 a week. They are going out there doing all sorts of scare campaigns, almost encouraging people to horde Weet-Bix under their bed because the carbon tax would have a 0.0006 per cent impact on Weet-Bix. I know that they are prone to their three-word slogans, so now it is 'Bix Under Beds' for the opposition because they want to beat the price rise caused by the carbon tax.

Look at what we have done. We have worked on the science. We have provided comprehensively through the Climate Commission the report that was tabled last week, The critical decade, to be able to detail in clear, factual terms what is going on. I am astounded that the response to try to undermine this work by notable scientists has been, 'They have been paid by the government.' This is the sum total of the response by the coalition. Yet if people put their hands in their own pockets on this issue critical to Australian public life and they fund a campaign to demonstrate their commitment to seeing climate change tackled, the opposition then undermines their efforts, as we have seen on the weekend with someone who has made their fortune from the ground up: Cate Blanchett, and some of the others. The opposition has sought to undermine their commitment to the cause. We have had consultations with business, NGOs and the farm sector looking at the household impacts.

What we have on the other side of the House are the sultans of subsidy—those people who would be willing to hand over at the outset $10 billion in subsidies to businesses who pollute and would do this in a way that would be ineffective in discouraging climate change, as evidenced by the Grattan Institute, which said that this type of work does nothing and will, in fact, by 2050, lead to an $8 billion per year extra cost to the budget. The other side do not have the will, the willingness or the ability to cooperate, as we have provided them the opportunity to do so through the Multi-Party Climate Change Committee. They stand as vandals on this issue, as opposed to what we are trying to achieve for generations to come. (Time expired)

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

The very thought of a carbon tax has made big business shudder and small business, the engine room of our economy, very surely catch pneumonia. The carbon tax did not get much of a run in the recent federal budget, but there was funding for a $13.7 million advertising campaign to sell this unwanted and unnecessary tax which will have such a negative impact on the lives of everyday Australians. The ad blitz started on Sunday. There was Michael Caton of The Castle fame spruiking the merits of a carbon tax. Someone, anyone, 'Tell him he's dreaming.' Cate Blanchett, wonderful actress, was also there on the small screen talking up the initiative. If Labor thinks it can sneak in this toxic tax via celebrity endorsement then it is wrong—plain wrong, morally wrong. Ms Blanchett would know that human and industrial activity has ensured CO2 levels are different than those in the Elizabethan era. It will not be any golden age if Labor, being dictated to by the unrepresentative Greens, forces a carbon tax on hardworking, long-suffering Australians. Our modern-day Maid Marian, Cate Blanchett, also ought to realise that a carbon tax will take hard-earned money from the pockets of the poor and will not decrease sea levels or lower the global temperature one iota—not one millimetre, not one degree. Robin Hood would not be proud. Perhaps our Treasurer is invoking the ideas of old King John from medieval times, who imposed harsh taxes on the working class.

This morning I received an email from an age pensioner in my electorate, who wrote:

When I listen to debates about a carbon tax, apart from it placating the Greens, I wonder if Labor's real intention is to have a new source of income in order to achieve their promised surplus?

The sender, Peter Piltz, is a fairly typical sort of person—a father, a grandfather, a former small business man, someone who knows a con when he sees it. He is like a whole host of other fairly typical sorts of people—regional Australians and city dwellers too—who can see straight through Labor's deception, spin and the fact that it has caved in to the Green pressure to keep a tenuous hold of its minority government.

Just before the 21 August election, the Prime Minister, who has shown she will say anything, do anything and be anything just to stay in The Lodge, declared: 'There will be no carbon tax under a government I lead.' She is right about that. Greens Senator Bob Brown is running this sorry show. The Prime Minister has no mandate to introduce a carbon tax and inflict financial pain on the Australian people. She should do the decent thing, the honourable thing, the democratic thing and call an election. Now.

There is an imminent risk to Australia of the government's decision to delegate the carbon tax to an unelected committee—a huge risk that we as a nation ought not be taking. What sort of committee makes such critical decisions affecting the nation without the Prime Minister and without the Deputy Prime Minister? The member for Lyne, who I might add represents an electorate which gave just 13 per cent of primary preferences to Labor—the party he took 17 days and then 17 minutes to give power to after the hung election result—has talked about imposing a carbon price sufficient to 'let the market rip' and 'let the science fly'. Carbon tax is Labor's big lie—another of its broken promises. As we have heard from the member for Farrer this afternoon, we have had the 2020 Summit, the citizens' assembly, the independent Murray-Darling Basin Authority, which made such a mess of water, and now the unelected carbon pricing committee all telling this government—which has no idea how to do anything—how to do its job. Labor will relish the opportunity to impose high-reduction emissions in line with its minimum 40 per cent cut by 2020 via a suitably stacked member for Lyne, Ross Garnaut style independent authority led by, say, Tim Flannery, Garnaut himself or carbon queen Cate Blanchett.

In the Garnaut review it is stated that Australian households will ultimately bear the burden of the full cost of a carbon tax—householders, not big polluters. A $26 a tonne carbon price would push up electricity prices by an extra $300 a year per household in just the first year. Prices would continue to soar every year thereafter. Petrol would rise by 6.5c per litre. Gas would rise by up to 10 per cent in the first year. Grocery prices would increase. The price of Australian made cars will increase by $412. Manufactured goods would rise. It will push up farming costs, as the member for Farrer indicated, particularly in the Riverina, an area I represent. Compensation will be temporary. Compensation will not change people's carbon-producing habits to stop what the Deputy Prime Minister ridiculously and hysterically calls 'dangerous climate change'. The introduction of a carbon tax will hurt Australian manufacturing, and dependent industries and communities, for no environmental gain.

United States President Barack Obama abandoned his planned emissions trading scheme, further proving that this Labor government is now completely isolated from its major trading partners. How many jobs are we going to lose overseas, and what damage will be done to our economy before the US, Japan and China get on board, if ever? Labor's carbon tax will send manufacturing overseas to countries which use more emissions to make the same things which are currently being made here. Businesses will be forced to cut jobs to be able to afford the carbon tax.

Labor claims that 29 out of 38 countries with Kyoto obligations already have an ETS. Those 29 countries all operate under the European Union ETS—27 EU countries and Norway and Switzerland. The EU ETS is not comparable to Labor's carbon tax and certainly is no justification for proceeding with it. Eighty per cent of EU trade occurs amongst EU countries; therefore less than 20 per cent of its trade will be exported outside the EU to countries where the producers do not face ETS costs.

Common sense has given way, yet again, under Labor to economic recklessness. Australians are going to be burdened by significant extra costs, for no environmental benefit; our economy has been distorted by the misallocation and redistribution of resources for no reason; and our exporters are going to be placed at a disadvantage in the international market.

The Labor government have set a target for reducing emissions without having any clue about the effects it will have on the country—

Mr Champion interjecting—

The member for Wakefield can interject all he likes, but he knows what I am saying is correct—or at least they will not reveal to the public what effects it will have.

Australia contributes 1.4 per cent of world energy CO2 emissions, according to 2002 figures. For the purpose of comparison, the USA contributes 23.5 per cent of global emissions; China, 14.6 per cent; the EU, 11.6 per cent. Why is this Labor government pushing for us to be world leaders with a carbon tax? Is it because Labor may be the government but the Greens have the power? Internationally renowned and respected environmentalist Bjorn Lomborg says there is no hurry; carbon taxes will only force us to spend all our money rolling out patently inefficient current technology when smaller investment in research would give much more innovative and much better and cheaper solutions in a few years.

Using agriculturally rich soil for forestry instead of for growing Australia's food supply will significantly impact on the produce that is supplied to cities and regional Australia. It might be fine for city slickers to support a carbon tax, but they will be the first to complain when they can no longer access fresh Australian produce. It is produce, not forests, which will feed our nation. We need to remember who puts food on our plates and supports the economy of this country. Crippling the agricultural industry will have major economic and social ramifications in regional Australia.

Just this afternoon Oxfam, in a media release entitled 'Broken food system could see millions go hungry', indicated that Oxfam's new Growing a better future report explains the world's broken food system, showing how rising food prices and increasing scarcity of arable land and water—rapid changes—will undermine access to food across the world. The media release reads:

Oxfam Australia Executive Director Andrew Hewett said: "Although the world produces enough food for everyone, the broken food system means one in seven people are still going hungry.

"Oxfam was created in response to the food crisis caused by the Second World War in 1942, but this is a new food crisis that threatens us all.

…   …   …

… the Australian aid program reflects the global trend over recent decades of declining investment in the food and agricultural sectors of developing countries. We must address this and prioritise support for small-scale primary producers who make up more than 80 per cent of the world’s hungry people."

The media release goes on:

The Growing a better future report reveals that:

And it certainly will not keep pace with a carbon tax. As a nation, Australia is best placed to grow the food to feed ourselves and the world. A carbon tax and an unelected committee determining it will do nothing to help the world food shortage.

Coming from a government which claims to be for regional Australia, this carbon tax drives a stake deep into the heart of regional Australia. The unelected committee deciding the carbon tax does not stand for what Australians need, does not represent the views of ordinary, everyday families and is just being led by the nose by Labor, which is being led by the nose by the Greens, who are very on the nose. (Time expired)

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

This has to be the strangest matter of public importance ever brought before this House. It is a very strange issue to debate, this issue of an unelected committee. I was really quite perplexed about what the debate might be about. But I have listened carefully. I listened in particular to the member for Flinders talking about the Boston Tea Party and other things. I cannot really understand it. This parliament is elected. The government is elected. Any committee report comes to us. The committee recommends things to us. It is subordinate to this parliament, to the democratic process, to the national interest, in the same way that every other institution set up by this parliament is—in the same way that the Reserve Bank, the Murray-Darling Basin Authority and other bodies and authorities set up under Australian law are always subordinate to this parliament.

I could not work out what we would be debating for such a length of time, but I now realise it is the Boston Tea Party; it is this attempt to conjure up a dark Orwellian fantasy in which we are ruled not by the parliament, not by democracy, but by some unelected body tucked away somewhere. This is the Liberal Party's new politics. It is an attempt to undermine this parliament's legitimacy, it is an attempt to undermine the policy intent of the government and it is an attempt to appeal to the extremists and fruitcakes who now populate the activist base of the coalition.

The first signs of this appeared in February of last year, when Tony Abbott, just two days after launching his climate change policy, met with Lord Monckton, a British lord. He met with him in secret. The member for Warringah refused to let us know what it was all about, but Lord Monckton told us what it was all about. He said that the proponents of climate change wanted to establish a world government that would shut down democracy worldwide. We can see that there are elements of that view in the MPI today. What else did Lord Monckton say after that meeting? Lord Monckton added:

… that Mr Abbott's policies to encourage tree planting and to help industry save energy would help address ''genuine'' environmental problems.

''It is indeed better to have a policy which nods to the issue of climate change for those who still believe, and there are some diehards who still believe, that fixes some of the genuine environment issues that are a lot cheaper than the enormous amounts—

of money—

diverted to this ridiculous climate thing,'' Lord Monckton said.

He said that it could be turned off if necessary. That is one of the things Lord Monckton said.

Alan Tudge (Aston, Liberal Party) Share this | Link to this | Hansard source

You're struggling. You're looking for your notes. You can't find them!

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

No, I was just looking for what Mr Turnbull later said. That was what Lord Monckton said. He said that this is a great policy. It gives a nod to climate change and, if necessary, can be easily turned off.

Fast-forward a year and the member for Wentworth goes on Lateline and says:

… I think there are two virtues of that from the point of view of Mr Abbott and Mr Hunt.

One is that it can be easily terminated. If in fact climate change is proved to be not real, which some people obviously believe—I don't. If you believe climate change is going to be proved to be unreal, then a scheme like that can be brought to an end.

So we can see here, from Lord Monckton to Malcolm Turnbull's quotes, that the opposition basically have a policy which is all about chicanery. It is all about conspiracy theories. It is all about designing a policy that will get them through the next election and provide them with a fig leaf for their resistance to the idea that the science is right. We heard it in the member for Riverina's defence of this MPI topic. He clearly does not believe that climate change is a problem. The references in this MPI to an 'unelected committee' are really targeted, as I said before, at those extremists who now make up the coalition's activist base.

We then heard their attacks on good Australians. We heard their attacks on Cate Blanchett. We heard their attacks on Michael Caton. These are people who are part of our cultural life, who have worked hard and who are our exports to the world. We heard Senator Barnaby Joyce out there attacking Cate, saying she was hurting people, and we heard the Leader of the Opposition in this parliament yesterday abusing her for having an 'ecomansion'. This deliberate bullying and abuse of Australian actors, this revolting political abuse that we just heard from the member for Riverina, is an attempt to paint good Australians as elitists. That is what it is an attempt to do. It is all part of this Boston Tea Party Republican revolt against the elite—Sarah Palin. That is the political appeal. That is the strategy behind it. It is anti-elitist. It is pitchfork-wielding conspiracy theorist. We saw them out the front of this parliament at their carbon tax rally, and right behind the Leader of the Opposition's head was a sign saying, 'Say no to carbon tax 4 UN/IMF global governance = agenda 21 genocide.' Those are the sorts of people who are supporting the opposition.

Poor Cate Blanchett. She must have thought that she was back in the Lord of the Rings, surrounded by hobgoblins, surrounded by orcs—these horrible denizens of the political world, horrible denizens of the conservative world, attacking her, having a go at her. The member for Warringah here, the Gollum of Australian politics, clutching his precious ring of negativity, his precious ring of opposition, desperately attempting to extract the last morsels of political gain out of his opposition to sensible Australians, verballing Dr Garnaut—this is the opposition's political strategy. It has nothing to do with good policy in this country. It is all about pandering to foreign extremists like Lord Monckton, meeting with him in private—'Solved! Lord Monckton, your views are so good!'—and then talking about unelected committees. Well, at least they are committees of Australians. At least they are not foreign lords. At least we are not appealing to this weird collection of international conspiracy theorists.

All I can say is: if that is really the opposition's strategy, it is not going to work. It is simply a strategy that is designed to cover up their massive divisions, and their divisions are big. On one hand there are the believers in climate change—there are many in the opposition, and they are horrified at the position the party is taking—and then there are those like the member for Riverina who are quite happy to deny climate change, who are quite happy to do anything, who are quite happy to quote environmentalists who put it all on black, who put it all on some technology turning up in the future. If we have a problem, well, we will just learn to adapt as the planet burns and the next generation of Australians and citizens around the world have to deal with an increasingly warmer planet and all the consequences that go with that. They have a strategy that is basically to get through the next election with this policy of direct subsidy, which will cost the nation $30 billion to top-end polluters. If there are no changes in that, by 2050 it might cost the future government $18 billion a year. That will be the 'small investment' the coalition makes—this weird sort of pork-barrelling exercise for the big end of town.

This is what the Liberal Party has now degenerated to. Fraser, Hewson and others are walking away from the Liberal Party because this once great bastion of moderation in Australian politics, has become a sort of home for foreign extremists, for bizarre ideologies of world government, and it rejects the influence of sensible, decent, hardworking Australians, like Cate Blanchett. We hear the abuse in the parliament of a great Australian actress and of a great Australian actor like Michael Caton—this abuse of good Australians.

Why do they have this political strategy? It is to deny the undeniable. We know that a little while ago the member for Flinders said in his honours thesis:

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

We know that the shadow Treasurer, the member for North Sydney, said last year:

… inevitably we'll have a price on carbon … we'll have to.

So the member for North Sydney knows that one day we will price carbon and the member for Flinders knows that we will price carbon. The only people who will not admit it are people like the member for Riverina, and basically they want to engage in appealing to conspiracy theories, listening to foreign extremists, abusing good Australians, purging all reason and good policy from their party and, finally, ignoring the national interest and the moral obligation we have to future generations.

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

It appears that the discussion has concluded.