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 Government's failure to adequately explain its carbon tax.

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

The government is spending $25 million of taxpayers' money on advertising its carbon tax, but it is not giving the facts, the details and the impacts and it is not telling the truth about what will happen to Australians, Australian businesses and the Australian economy under this carbon tax, nor is it telling the truth about the alternatives. Let me begin where the Prime Minister left off just a few moments ago. The member for Aston asked about the impact of the carbon tax on Mystique printing. Mystique printing is a carbon neutral business but it will still have electricity bills to pay. Mystique printing is not going to be magically exempt from electricity bills. Mystique printing, like hairdressers, pizza shops, small manufacturing shops around the country and firms of any shape, sort, type or nature that consume electricity or gas, will have higher bills to pay. The Prime Minister would not stand before this House, in the same way that her advertising campaign will not disclose the full facts and the truth to the people of Australia, and give the simple plain truth that Mystique printing will have higher electricity bills—on the government's estimate, 10 per cent alone in the first year. And that is simply on their electricity bills. It is nine per cent alone in the first year on their gas bills and, most significantly, as the New South Wales Treasury modelling has shown, a 15 per cent increase in electricity, debunking the figures provided by the government. That is in the first year, because each year and every year thereafter the cost for firms such as Mystique printing will increase. Each year and every year thereafter the costs for Australian families will increase, but the full scope, scale and nature of the impacts of this tax have not been released, have not been disclosed and have not been given to the Australian people by the government.

Let us start with something very simple. This is the government's modelling. At the top of page 18 of the government's summary modelling document, there is a simple proposition. It says:

Macroeconomic modelling with an initial domestic carbon price of $20 in 2012-13.

Five and a half weeks after the carbon tax was released, this government has yet to release modelling which reflects even the correct carbon price. When your modelling cannot reflect the correct carbon price of $23, which is 15 per cent higher, 5½ weeks after it has been released then you know that something is not right with the government of the day. This government has directly, deliberately and consistently failed to disclose the full detail, the full impact on Australian houses and Australian homes of their system and it has been utterly untruthful in analysing the alternative model available to the Australian people and utterly untruthful in presenting the world as it is today.

So let me begin, when we look at the government's failure to adequately explain its carbon tax, with the cost to families. Nowhere have I seen in any of the numerous television advertisements at taxpayers' expense, in any of the numerous mainstream newspaper advertisements at taxpayers' expense, in any of the local newspaper advertisements at taxpayers' expense or in any of the internet advertisements at taxpayers' expense the simple fact that the average Australian household will pay $515 per year more for their cost of living as a consequence of the carbon tax. There is no recognition that the New South Wales Treasury says it will have a 15 per cent impact on their electricity prices for households—for mums, for dads, for pensioners, for seniors—in the first year of the carbon tax, before increasing each year every year thereafter.

That is the nature and purpose and intent of this tax: to drive down demand by driving up the cost of living in the hope that a sufficiently punitive price will cause people to shiver through winter and swelter through summer. That is the nature and goal of this particular mechanism. That is what it is designed to do. It is designed to hurt those who are least able to afford it so that they will consume less electricity. That is the structure and the intent.

On numerous occasions the Prime Minister has talked about people consuming the lower cost product. Unfortunately the lower cost, lower carbon product does not exist. The lower the carbon, the higher the cost. What we see is this government intentionally driving up electricity prices. The fundamental problem with what this government is doing is that electricity is an essential service and if you drive up electricity you drive down the quality of life for Australian families.

But you do not drive down the consumption significantly because people substitute not out of electricity consumption but out of the ordinary day-to-day things. Electricity goes up but consumption barely changes. On every analysis it is a largely inelastic good and so, in real human terms, families suffer. As we see in New South Wales, Queensland, Victoria, South Australia, Western Australia and Tasmania, higher electricity prices have not made a material difference to electricity consumption but they have made a dramatic difference to the cost of living for ordinary Australian families.

It goes on from that, though. These things are not set out in the government's carbon tax advertising. The fact is that we are likely to see, as the member for Bennelong has found, that in the city of Ryde $1.8 million of electricity bills for lighting will go up immediately by $270,000, according to the New South Wales Treasury. That $270,000 will either come off services to local ratepayers in the city of Ryde or it will go onto the cost of council rates. There is nothing about that in the government's carbon tax advertising.

Nor is the fact that there will be over $100 million of additional landfill costs to be passed through council rates as a consequence of this tax. There are better ways of doing this that do not involve a massive increase, a $27 billion tax over three years, a $36 billion tax over four years. That is the size and scope and scale of this carbon tax and these are the figures that are missing from the government's carbon tax advertising.

Nor is there reference to the fact that for dairy farmers, on some estimates provided by the industry, the average cost will be $7,000 per year more. Some of that will be passed through to consumers, but in many cases where the vast bulk of production is sent to export markets it is the dairy farmer that will face those costs. The dairy farmer on a struggling farm will meet that cost himself or herself, with the cost going straight back to the family budget and the impact on their viability.

Nor do we see the extraordinary fact that this carbon tax produces approximately 25 per cent of all of the savings that the government claims will be made in terms of emissions. This is the great lie at the heart of the policy and the advertising. Approximately 100 million tonnes—according to the summary indicators document, 101 million tonnes—will be sourced from overseas. According to the deeper modelling document, 94 million tonnes will be sourced from overseas. Let's call it a rounded figure of 100 million tonnes that will be sourced from overseas and that is using abatement purchasing. That is using the very model which this government has attacked, derided, denounced and ridiculed. At the end of the day they have been forced into an abatement purchasing model.

The second thing, though, is that 20 million of their 160 million tonnes comes from an incentive scheme to clean up the power stations. The difference is that we would clean them up and they would close them down. This is the heart of direct action which they have ridiculed, mocked, derided and yet adopted when it comes to the moment. That leaves the carbon tax itself being responsible for about 40 million tonnes of emissions reduction versus business as usual by 2020. What does that mean? It means that the effective cost of carbon for domestic abatement using their tax is well over $160 per tonne. It means that their system, which relies on driving up the price of electricity, is fundamentally economically unsound because it has relied upon either driving down demand by driving up price—but the history of Australian economics in the last 30 years, as Colin Barnett says, is that electricity is an essential service—or changing supply by forcing the closure of coal fired power stations where, unfortunately, their own work shows that a dramatically higher price still would be needed. In other words, their system on their own analysis does not work. Seventy-five per cent of their reduction comes from some form of direct action and 25 per cent of their reduction actually comes from the carbon tax. The carbon tax is entirely superfluous to reducing emissions.

These figures are not included in any of the advertising, which is why it is so execrable. More significantly, when you look at the modelling you see that the $20 per tonne carbon price 5½ weeks later still has not been updated. How can it be, Minister Combet, that you have the wrong carbon price in your modelling? How can it be that the government of Australia has the wrong carbon price in its modelling? It is unacceptable, indefensible and incompetent. Nor has the modelling been reflected to update the fact that its assumption of 100 per cent purchase from overseas sources has been overturned by a political decision to leave it at 50 per cent purchasing from overseas sources. Nor does the modelling indicate the fact that the brown coal buyout is entirely unfunded. They already have a $4.3 billion black hole but, other than some vague reference to the contingency reserves beyond the forward estimates, there is no provisioning for the $2 billion plus that is likely to be the cost of the brown coal buyout. While we have a $10 billion program where we are completely upfront, they have a program which over nine years is likely to be well over $80 billion. What we see is a $4.3 billion black hole to start, another $2 billion that is missing and none of these figures are set out in the carbon tax advertising.

Then this brings me to the extraordinary element which the Leader of the Opposition made reference to today, $3½ billion each year every year from 2020 onwards—it will start at a lower figure before then but it will climb—will be spent on purchasing foreign carbon credits from foreign carbon traders. That is Australian money going straight offshore each year with a huge impact on our national viability. According to page 72 of the government's own modelling, that figure by 2050 will be 434 million tonnes of certificates at a price in 2010 dollars of $131 at a total cost to the economy of $57 billion or approaching 1½ per cent of GDP, and that is on purchasing foreign carbon credits from foreign carbon traders.

The Australian Crime Commission has found that there has been widespread fraud in Europe in relation to these credits. This is not in relation to some emerging economy. In Europe there has been massive fraud using this approach and that is what this government is proposing—1½ per cent of GDP on foreign carbon credits alone, $3½ billion by 2020 on foreign carbon credits from foreign carbon traders alone. We set out in our policy on day one—which the minister has failed to acknowledge, but I see on page 14 of the direct action policy in big blue headlines the words, 'Direct Action in Australia, not Overseas'—that every dollar of our policy would be spent in Australia.

Obviously, the minister made a false statement to parliament yesterday. He would not defend himself today. We set up from day one that every dollar would be spent in Australia. If the minister is unable to read the document, there it is in big blue letters, 'Direct Action in Australia, not Overseas', every dollar to be spent in Australia. The minister might do the honourable thing and apologise to the House for his express, clear and absolute misstatement yesterday because there is no defending that. He knows it, we know it, the Australian press gallery know it and the Australian people will increasingly know that we have seen deception on a grand scale. But at the bottom line at the end of the day what this government has done is that it has systemically misled the Australian people about the costs to households of the carbon tax, the costs to businesses such as Mystique printing, and the cost to the economy of $3½ billion a year straight to foreign carbon traders. (Time expired)

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

I appreciate the opportunity to explain the government's policy, but at the outset can I completely repudiate the assertion that was just made by the shadow minister that I had made a false statement to the House. That is completely incorrect and I repudiate it entirely. It was completely unsubstantiated.

On 10 July the government announced a Clean Energy Future package. What we announced was accompanied by a very detailed set of materials outlining a host of the policy issues in detail including Treasury modelling and a number of other materials. At its core were a number of elements. One of them was a carbon pricing mechanism. The carbon price mechanism is an emissions trading scheme that commences with a three-year fixed price period, commencing from 1 July 2012, and from 1 July 2015 it is an internationally linked, fully flexible, emissions trading scheme—that is, it links with international carbon markets. I will return to that issue in time to address some of the comments made by the shadow minister.

There were other important elements of the announcement by the government on 10 July. Within that announcement was very strong support for renewable energy and a number of measures to improve energy efficiency in households and in businesses. A very significant element of the package relates to the land sector, carbon farming and the storage of carbon in the landscape. It is a very comprehensive policy package and I do not think anyone could seriously assert that a considerable amount of detail was not provided to the community. I make that point to repudiate the general statement that the shadow minister was endeavouring to make. The policy material is principally contained in the document Securing a clean energy future. Behind it sits a very comprehensive and credible set of Treasury modelling based upon the scenarios that would appropriately underpin a major policy initiative of this nature, representing, as it does, significant economic and environmental reform. All of that material is available to the community and has been published.

It is worth recalling for the moment that this is an emissions trading scheme and it has some features in common with the policy that Labor endeavoured to prosecute in the previous term of parliament. That previous proposal was at one point in time the subject of agreement with the coalition. It included important features such as the international linking of the emissions trading scheme with the international carbon markets. It is embarrassing, in fact, to hear the shadow minister repudiate so much that he stood for in the past from a policy standpoint, having completed a thesis on market mechanisms, including, I think, a set of policy propositions that he has completely walked away from. It is a pretty pathetic thing to see.

The entire policy position that the government announced is underpinned by the climate science. Of course, this is another matter of contention across both sides of politics. The shadow minister professes to accept and respect the climate science, but his party is led by someone who has had 100 different positions on the science and who sends the signal to those in the community who do not respect the science that he is with them. It is the same way that he walks both sides of the street on many different issues. In a formal forum he will say he accepts and respects the science, but when it is appropriate—particularly when he is on radio in Sydney with Alan Jones, his close colleague—he will send a very clear signal that he has no respect for the science, no respect for scientists and indeed no respect for economists, who support dealing with carbon pollution by a market mechanism.

It is always important to come back to the foundation of the science because the opposition has no credible policy to address what scientists are telling us. We always have to bear in mind that the empirical evidence is clear. Last year, 2010, was the warmest year on record, equal with some others. It was the 34th consecutive year with temperatures higher than the 20th century average. The warmest decade on record was 2001 to 2010, and each decade since the 1940s has been warmer than the last. This country, and many others, has a lot to lose from climate change and the warming that we are experiencing. The science is telling us that carbon pollution is contributing to the change that we are experiencing.

It is an international problem. The atmosphere is global; it is not confined to any national boundaries. Australia needs to participate in discussions with other countries about how we will address this problem, because, in particular, Australia is one of the top 20 polluters internationally and the highest polluter per person of all of the developed economies. No responsible government receiving this scientific advice and recognising these statistics has any alternative but to address this issue, in partnership with the international community, by reducing its levels of carbon pollution and driving investment in clean energy sources in its own economy in order to play a responsible part internationally in dealing with this issue.

It is incumbent on any government receiving this advice to act upon it. The government must take these steps to cut pollution, to contribute to international efforts to address climate change and to drive change in our own economy, but to do so at least cost to our economy, at least cost to businesses and at least cost to households. This is precisely what has driven the development of the policy that the government announced on 10 July. A carbon price mechanism, in partnership with the other elements that I described earlier, will drive cuts in pollution in our economy at least cost to the economy, to businesses and to households.

It is a simple proposition, to provide the incentive to cut pollution to the largest emitters of pollution in our economy. Those polluters can reduce their liability under the carbon price mechanism by reducing their pollution. They can do so in particular by improving energy efficiency and investing in lower emissions technologies. It will be particularly important in the years to come to improve the performance of our electricity generating sector with respect to the pollution that is attendant upon electricity generation. The advantage of a cap-and-trade emissions trading scheme is that the government can set emissions reduction targets. In fact, there is supposed to be bipartisan support for a set of emissions reduction targets in this parliament, in this House. The unconditional bipartisan emissions reduction targets that both sides have indicated their acceptance of is a five per cent reduction in pollution by 2020 from year 2000 levels. The carbon pollution mechanism that the government announced on 10 July will deliver at least that outcome, and that represents a reduction by the year 2020 of 160 million tonnes of carbon pollution. That is a very important commitment.

The government has also indicated its intention to establish the Climate Change Authority. It will be chaired by former Reserve Bank Governor and Treasury secretary Mr Bernie Fraser. The Climate Change Authority will have the responsibility of providing advice and recommendations to government on the pollution caps that will operate under the emissions trading scheme so that from 2015, when we commence emissions trading with international linking, pollution caps will be set by regulation by government. The emissions trading scheme will achieve at least the 160 million tonnes of pollution reduction by 2020, but the Climate Change Authority may recommend further emissions reduction targets by that time. Government has the discretion, of course, to act on those recommendations.

The other thing that is important in the development of an approach to tackle climate change and is represented in the policy that the government has announced is, as I mentioned, that we address change within the electricity-generating sector. One of the elements of that that is contained in the policy is the commitment by the government to seek to negotiate the closure of up to 2,000 megawatts of high-emissions, older, pollution-generating capacity in our system. The shadow minister falsely indicates that there has been no provision made for that negotiation in the material that was released; in fact, there is provision. A contingency has been made in the contingency reserve in the budget for that negotiation for the closure of up to 2,000 megawatts of high-emissions capacity. I do not think any responsible government is about to indicate what that quantum that has been provisioned may be. There will be a negotiation should some participants in the energy market wish to discuss that issue with the government, but we are not about to indicate to those players what the government may have provisioned. However, a provision has been made.

A number of other important elements of the policy have also been included. The government has indicated a commitment to establish a clean energy finance corporation and make an equity investment of $10 billion. That corporation could provide loans, loan guarantees or make equity investments in an effort to assist participants in the private sector and bring some technologies to the market.

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

Not a front for your mates?

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

The member for Indi suggests it may have some inappropriate use. It will not. It will be a finance corporation with an independent board. It will have an investment mandate and it will be established in a manner that will ensure that it operates in an appropriate fashion to assist and commercialise low-emissions technologies and renewable technology—notwithstanding all the slur, slander and rubbish that comes from the other side.

Importantly, having established all of these mechanisms to cut pollution and drive investment in our economy, naturally the government has also placed a lot of attention on assistance to households and businesses, in particular to households to deal with any price consequences of the establishment of a carbon price in the economy. The Treasury modelling on this is clear. There is projected to be a 0.7 per cent increase in the CPI as a consequence of introducing the carbon price mechanism. The average potential price impact on households averaged across the economy is around $9.90 according to the Treasury modelling. The government, of course, will institute tax cuts, increases in the pension, increases in family tax benefits and a host of other Commonwealth payments to offset for many households that price impact, modest as it may be. In fact, the average level of assistance provided to households across the economy is $10.10.

The tax cuts will be delivered by a very important tax reform. The proposition contained in the policy material that the government will implement provides for an increase in the tax-free threshold from $6,000 to $18,200 from 1 July next year and, from 1 July 2015, an increase in the tax-free threshold to $19,400. This will mean that more than one million people will not have to submit an income tax return. It will deliver tax cuts to many households. Coupled with that, pensions and other Commonwealth payments will rise by 1.7 per cent, meaning that, contrary to the assertions falsely made by the shadow minister, nine out of 10 households will receive some assistance to meet the modest price impacts. Six million households will receive assistance to meet their expected average price impact. Four million households will receive assistance of 120 per cent of their expected price impact. Single pensioners will be better off. Coupled pensioners will be better off. Many others in that category of four million households will be better off.

On top of this, the government is providing significant assistance to industry to support jobs, in particular in relation to industries that are in the emissions-intensive trade-exposed part of the economy. There is also assistance for small business. There are other measures contained in the policy announcement that are very important that interested members of the community have access to.

Up against all of this is a farce of a policy from the coalition. It does not stack up. When the policy was first enunciated by the shadow minister in February 2010, it asserted that about 70 per cent of the emissions reductions it proposed could to achieve an emissions reduction target of a five per cent cut in year-2000 levels of emissions in our economy by 2020 could be achieved from soil carbons. The science is not there, and it does not comply with the international rules. It simply cannot work. (Time expired)

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

The minister, the member for Charlton, gave us one of his least convincing performances. He has this tactic: if you want to have everyone switch off, if the potato is too hot to handle, speak in the most boring monotone voice to bore people into submission. We have a government that is not and should not be surprised that they are not believed. It all goes back to an issue of trust. She stole an election result on the explicit promise, 'There will be no carbon tax under the government I lead', knowing full well that she did not intend to fulfil that promise. They go to an election campaign saying that they will not introduce a carbon tax. They belittle and ridicule the Leader of the Opposition—who said that there would be a carbon tax. Then they win government and give in to the Greens, not in order to save the planet but to save Ms Gillard's job. She is called the great negotiator. What a fool! She should have known there was no way in hell that the Greens would have supported the Liberals over the Labor Party. There was no way they were going to support Tony Abbott. She gave the Greens the carbon tax. She decided, using her great negotiating skills, that the Greens would run away to the Liberal Party. What a fool! What an idiot! What a liar, as she is called by so many people in the community.

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

Order! The member for Indi will resume her seat. I require the member for Indi to withdraw the term 'liar' and other derogatory terms referring to the Prime Minister, and while I am at it I would ask the member for Indi to refer to other members in accordance with standing order 64, not by their name. I call the honourable member for Indi.

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

I withdraw, Mr Deputy Speaker, and fully respect the standing orders that prevent me as a member in this House from repeating the comments made out there in the community from one end of the country to the other, particularly from many former Labor voters. But when a Prime Minister goes to an election making such an explicit comment, then reneges on it and decides to sell out to Bob Brown and decides to speak to Bob Brown before her own backbenchers, is it any surprise that people do not believe the scant explanation and promises given on the carbon tax and the so-called compensation package? People do not believe that the CPI will increase by only 0.7 per cent—and why should they? None of the government's budget estimates or mid-year updates have been accurate in any way whatsoever. Why would the situation change now?

We have seen costs go up and up and up. The carbon tax will go up but compensation will not go up. The minister talks about modest price increases, but people are already hurting. They know that they cannot trust the government's modelling; it has not been fully explained and there are many factors that have not been included. For example, where is the modelling to show the number of SMEs that will close? We know that the SME sector is very important in Australia. We know that it has the least capacity to absorb increased costs of production. We all know that, when small businesses close and larger businesses increase their market power, prices also go up. That has not been factored into the government's projections either.

The government says there will be all this compensation, but what is the reality? Everyone knows that a carbon tax is intended to hurt every time you use electricity and every time you use energy. Even on the government's own figures, even if we were trusting and naive enough to believe the figures that it has provided, we see that a couple earning $60,000 each with two children would be worse off. A couple earning $60,000 with no children would be worse off. A single person earning $60,000 would be worse off. This is intended to punish consumers because that is what the Greens want. The Greens want to punish consumers. They think we probably live too affluent a lifestyle, we use too much and we consume too much; so let us just punish people—punish people into submission! If you look at average wages in professions such as teachers, ambulance drivers, accountants, crane operators, manufacturers, park rangers and physiotherapists, all of these people will be worse off.

We hear about compensation to industry, but if you do not damage industry you do not need to pretend to compensate it. As Graham Kraehe from BlueScope said, any compensation would be like a bandaid over a bullet wound.

David Bradbury (Lindsay, Australian Labor Party, Parliamentary Secretary to the Treasurer) Share this | Link to this | Hansard source

When did he say that?

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

He said that at the National Press Club. You should have been there, my friend. You should go to your electorate of Lindsay and speak to those people who are saying to us: 'Our member is letting us down. Our member does not understand how hard we are doing it. Our member does not understand how difficult it is to make ends meet. And now, instead of listening to mainstream Australia and Lindsay, our member supports the Prime Minister in sucking up to Bob Brown so she can keep her job.' You are a disgrace and you should hang your head in shame.

When we look at the steel industry, a very important industry, and those important workers across the country, particularly in Port Kembla, we hear the government proudly say that it is providing additional assistance to the industry. It is supposed to be $300 million in assistance, but guess what? For our two main steel companies, BlueScope and OneSteel, the total value lost on the first day that the carbon tax was announced was almost the equivalent of the package. On the second day the value that these companies lost was over $100 million. So your so-called compensation is inadequate to even make up for the loss in corporate value of our two main steelmakers. So much for compensation!

This government is all about churn: punish people, bring in a program, tax it, borrow it, hand it around, move it around—a bit of trickery and a bit of deception. No wonder there is no trust in what is said. This government has not explained to the Australian people that Australian industry and Australian manufacturers are some of the most efficient in the world. Our steel producers are the most efficient in the world. They create fewer emissions and have a more efficient production process than exists in China. The government has not explained that to the Australian people. It has not said to the steelworkers: 'You do a great job. You are part of an efficient and effective industry.' 'No', it has said: 'You are big, bad polluters. You naughty people! You make steel—the steel we need for our cars, the steel we need for our houses—you big, bad, naughty people! We would prefer to make the steel you make more expensive, to drive manufacturing offshore to countries that will create more emissions to make the same things we used to make'. So we are closing down industry and closing down jobs to—guess what?—increase worldwide emissions because our manufacturing will go to places like China, where they create more emissions making the same stuff that we used to make.

You have not explained any of those facts, not to your constituents and not to the Australian people. You have not actually stood up and been proud of Australian manufacturing. In industries like cement, chemicals and plastics; in the steel industry, in the car industry and the car components industry; in food and grocery processing; and in aluminium and glass making, a carbon tax is going to punish these industries and give a leg-up to imports with which they compete.

So we will be sending our manufacturing offshore to increase emissions. Many Australian businesses already operate on wafer-thin margins. Does the government listen? No. When the Prime Minister was asked, 'What do you say to manufacturing?', she giggled, 'Ha, ha, ha. They will do what they've always done. They'll innovate; they'll get on with it'. Well, Prime Minister, manufacturing businesses are facing a pretty tough time and your carbon tax will send many of them to the wall and will send many of them offshore.

What will it do to households? It will hurt them even more because of the lie you spread during the last election and the lies you continue to spread now.

Mr Dreyfus interjecting—

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

Order! I ask the member for Indi to withdraw the word 'lie'.

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

Causing such great consternation to the member for Isaacs. The member for Isaacs should calm down. I know the manufacturers in his electorate are very upset—

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

Order! The member for Indi will remove herself from the chamber for one hour.

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

Good riddance!

Opposition members interjecting—

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

I may have called the Prime Minister a liar but he should withdraw that!

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

Order! The first thing I require is for the member for Indi to actually withdraw the term 'lie'.

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

I withdraw the term 'liar', and say to the Australian people that free speech still exists out there.

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

She will withdraw unconditionally.

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

I withdraw.

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

The member has referred to a comment allegedly made by the Parliamentary Secretary. I did not hear that. Would the Parliamentary Secretary assist the House by withdrawing?

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

I withdraw.

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

He has withdrawn.

Opposition members interjecting—

And the member for Indi has been asked to remove herself from the House for one hour.

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Innovation, Industry and Science) Share this | Link to this | Hansard source

You have saved me from a berating.

The member for Indi then left the chamber.

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

It is a pleasure to rise on this matter of public importance raised by the member for Flinders, because it is a significant achievement for the opposition. In introducing this matter they have had to use the words 'matter of public importance' in the context of the climate change debate.

After listening to months and months of the 'no, no, no, no' campaign waged by the opposition—which is all we have heard from the member for Flinders, all we have heard from the Leader of the Opposition and all we have heard from those opposite—I can tell members of the House that this grudging acceptance that this is a matter of public importance is about as close as we are going to get to recognition from the opposition of the importance of this environmental threat to Australia and the whole.

I am more than happy to talk about the government's climate change policy, about how we are getting on with the job of legislating a carbon price for Australia and how we are getting on with the job of legislating to tackle climate change by putting a price tag on every tonne of pollution that is produced by around 500 large polluters. That carbon price will commence on 1 July 2012. I am very pleased to talk to the House about how every member of the Labor caucus since we announced the scheme on 10 July has been out there discussing the carbon price package; out there discussing the clean energy future plan that we have for Australia with communities and with businesses around the country, and about our plans to continue that discussion with the Australian people as we move to deliver this major economic and environmental reform.

Of course, I will wait, because I do not think that we have yet had all of the speakers from the opposition. I must be patient; we have not heard from all of them. I will wait to hear the lament that they seem to share because they are concerned about the way that the carbon price plan for Australia has been explained by raising this matter; their lament at the impediments that have been put in the way of the government—by the opposition—in adequately explaining the carbon price.

I hope that we will hear from some members of the opposition who are yet to speak about some of the misinformation that has made its way into the public debate. I fear we are going to be disappointed, because we have seen two further examples this afternoon—in the speech by the member for Flinders and in the speech by the member for Indi—of the repetition of misinformation; further repetition of false claims about the effect of the carbon price on Australian manufacturing and about the effect of the carbon price on Australian industry.

What we should be hearing from those in the opposition, if they were genuinely concerned about properly debating this question with the Australian people, is a complaint about the way the Leader of the Opposition has engaged in a four- or five-month-long bricklaying, petrol-pumping, fish-slicing fear campaign that has done so much to crowd out genuine debate on this issue. They might pause to reflect on the full spectrum of the misinformation that the opposition has been spreading about the carbon price plan, which has now included singing and dancing in the Senate, Shakespearean recitals, made up figures, made up facts, the wall of Weet-Bix, denial of climate change—apparently followed by a reluctant acceptance of climate change—some cameos with Pauline Hanson and also, really, just an exploration of the red-cordial-induced limits of silliness. I know there are a few speakers from the opposition yet to speak. Perhaps we will hear from them and I must wait. In contrast to what can only be described as the completely unprincipled and disgraceful campaign from the Leader of the Opposition, assisted by the member for Indi in particular, where the opposition has sought to misrepresent the government's position across the country and instil in Australians fears about their job security and cost-of-living pressures that are completely unjustified, the government will continue to explain the carbon price package, the clean energy future plan, to the Australian people, and I am looking forward to continuing to do this in the months to come. In the past few weeks I have visited communities in Victoria, in Queensland, in the ACT and in New South Wales, and I have spoken to businesses, to community leaders, to people at retirement villages and to people at bowls clubs about how Australia is going to be implementing this carbon price and about the financial benefits to our country of implementing this carbon price. I have met with people in communities who want to know the details of the assistance that is going to be coming their way under the clean energy future plan, about the assistance that is going to go to nine out of 10 households, about the tax cuts that are going to go to everyone in this country who is earning under $80,000 a year and about the extra benefits that are going to be flowing to everyone in receipt of a pension or a government benefit.

This is in contrast to the kind of fantasy land inhabited by the member for Indi, who this afternoon was again repeating—but in a particularly egregious fashion—elements of the opposition's scare campaign about the steel industry. She made a remarkable misattribution of the time at which Graham Kraehe spoke; I have had it checked while I have been waiting to speak, and in fact he spoke on 22 March this year, so it was some months before the carbon price package was announced. Graham Kraehe is, of course, the chair of BlueScope. I think it is more important to look at what the two steel companies of our country, OneSteel and BlueScope, said about the carbon price plan after it was announced. We have Geoff Plummer, the managing director and CEO of OneSteel, saying in his release to the Australian Stock Exchange—a formal document—on 10 July 2011:

We believe that on balance, the sectoral approach announced today by the Prime Minister for the steel industry, including the introduction of the—

Steel Transformation Plan—

is both appropriate and sensible. We are pleased that the Government has responded by adopting this approach.

I then go to the BlueScope response, contrary to what was suggested by the member for Indi. This is Paul O'Malley, managing director and CEO of BlueScope Steel, speaking on 11 July 2011, the day after we released the clean energy future plan:

This is a pragmatic solution to a complex problem.

BlueScope said:

… the Government’s proposed new Steel Transformation Plan (STP) recognised the Company’s long-standing call for a sectoral approach to a carbon tax in Australia.

Mr O'Malley said:

The STP will provide funds to minimise the impact of the carbon tax on the Australian steel industry for the first four years … And it signals the Government’s intention to limit the potential pass-through of Scope 3 coal emissions costs onto steelmakers … In summary, the STP materially reduces the overall cost of the carbon tax on BlueScope. … The Government has listened to our arguments and our deep concerns about the carbon tax

In the STP it has produced a package—

and so on. Those, of course, are not the words that the member for Indi wants to hear, and that is why she did not quote from actual commentary made by Australia's two steel companies after the announcement of our clean energy future plan.

We have the situation that the opposition's scare campaign is falling apart day by day. As more and more Australians learn the details of the government's clean energy future plan, there will be less and less concern. Because there is less and less concern as Australians learn of the details of the assistance going to nine in 10 Australian households, we are seeing more and more shrillness and nonsense spoken by those opposite and more and more misleading statements—anything rather than actually quoting from what the steel companies are telling Australians, anything rather than actually quoting from our plan and anything rather than explaining to the Australian people that there is in fact assistance coming to nine in 10 households.

By the end of next year—I know that is a long time off for the short-term people on the benches opposite to even contemplate—a few months after the introduction of the carbon price on 1 July 2012, which I know is a long time for those opposite to think about, Australians are going to be saying: 'What on earth were the opposition banging on about? What on earth was the Leader of the Opposition banging on about? What on earth was the member for Indi banging on about as she went around Australia trying to drum up fear by spreading misinformation and misrepresenting the effect of the carbon price?' As for the inaction policy of the coalition, it is not capable of meeting the target which the Liberal Party claim to share. (Time expired)

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

I welcome the opportunity to speak on this matter of public importance, but before I go to the substance of my contribution I would just like to challenge a few words from the member for Isaacs. He commented on the fact that the Prime Minister said from on high: 'Go out and sell the carbon tax. Go out and make your voices heard. Go out and tell the Australian people why higher power prices are going to be so good for them.' And do you know what the response was, Mr Deputy Speaker? The response was silence, because I have to say I did not hear too many marginal seat members out there selling the benefits of higher electricity prices and job losses. I did not see too many marginal seat members saying too much at all about the carbon tax. In fact, they were running and hiding. I have to say that, if you wanted to see the definition of someone looking sick, it was a Labor marginal seat holder when the Prime Minister came to visit to sell the carbon tax, because it is a toxic tax that nobody wants and you are deluding yourselves to think any differently. This day, one day after the first anniversary of that notorious statement that there would be no carbon tax under a government she led, the Prime Minister needs to explain why she is so intent on doing so much damage to the Australian economy, on destroying jobs, on driving up the cost of living and on cruelling small business and large business. We have a situation where the world is facing very challenging and very uncertain times. Just yesterday the Treasurer said there had been:

… big swings in global share markets, a downgrade to the US government's triple-A rating … and a rapid rise in borrowing costs facing Spain and Italy.

He continued:

In uncertain times like these, it is more important than ever that we have a mature debate about our economy and where it is heading …

Yet at the same time his government is imposing a carbon tax which will increase the cost of doing business, that will cost jobs, that will slow growth and that will damage our economy. This is no time for this negligent Prime Minister to be introducing a carbon tax that is going to do so much damage to Australia.

Overnight, Germany announced that their GDP slowed to almost a standstill in the second quarter of 2011, increasing only 0.1 per cent, down from 1.2 per cent in the previous quarter. Markets took a dive again overnight over fears that France is struggling to deal with its debt crisis, which totals 85 per cent of French GDP, some €1.65 trillion. Countries like Greece and Spain are struggling with trillions of dollars of debt brought on by governments spending more than they can afford. There is a crisis of confidence in the world economy. The US government owes US$14.6 trillion. Australia must ensure that our economy remains as stable as possible and not do anything to threaten our growth.

Instead, what is this government doing? This government is intent on imposing a tax that is going to reduce our international competitiveness. This government is intent on imposing a tax that is going to make it harder for businesses to generate growth, generate jobs and continue to allow Australia to prosper. In the labour market, Qantas has announced 1,000 job losses—that is before a carbon tax is going to hit; OneSteel has announced 400 job losses; Channel 10 has announced 150 job losses; and Westpac has announced job losses. What is the government's policy response? You are going to impose another great big new tax. Is that good policy? You guys are dreaming if you think that is going to help our economy prosper. If you think that is going to aid this country to grow you are in dreamland. At a time of global uncertainty the government is reducing the ability of Australian businesses to compete, and there is no question that that is going to result in job losses.

Australia is dependent on exports to maintain our economic growth. The Treasurer said after the budget in May:

With the right policies and decisions, we can convert an unprecedented mining investment boom into an opportunity boom for more of our people.

The carbon tax is the wrong policy at the wrong time to capitalise on Australia's competitive advantages. We are dependent on China for much of our exports. In 2010, Australia's exports to China totalled $58 billion or around five per cent of our GDP. If demand in China for Australian resources were to collapse, it would greatly impact our economic growth. But our threats are not limited to a potential slowing of growth in China. Australia exports $18 billion to the European Union each year and a further $9 billion to the United States. Both the EU and the US are certainly encountering huge economic challenges, and this tax is not going to do anything to assist Australia in combating the potential impacts of those challenges.

The fallout from the problems overseas could have major impacts on our exports and major impacts on Australian companies. We already have this government planning to impose a mineral resource rent tax on our mining exports. This Prime Minister really does have to come into this House and explain why she is doing that. The Prime Minister promised she was going to wear out her shoe leather to tell the story, but I can report to this House that her shoes are in perfect condition. After only a week she gave up on the information campaign, she gave up on peddling the falsehoods, she gave up on trying to spin the lie that has been put about—

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

Order! The member for Cowper would be aware that that terminology is completely inappropriate and disorderly. I call on him to withdraw that statement unreservedly.

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

I withdraw, Mr Deputy Speaker. We saw the Prime Minister abandon her sell job. She abandoned the job of trying to convince the Australian people that this toxic tax was good for them. She abandoned any notion that that was going to be good for them. In fact, she has done everything she can to change the subject. We heard the Prime Minister talking about the VFT, the very worthwhile notion of the disability insurance scheme and hospital reform—anything but the toxic carbon tax. Anything that she could get in the news cycle apart from the carbon tax was mentioned by this Prime Minister.

The government talks about the fact that many of our industries will be protected by a range of subsidies. What international investor and what Australian investor would want to invest in an industry that will be dependent on government subsidy for the rest of its life? What a ridiculous situation to put our very fine industries in, a position where for the foreseeable future they are dependent on government largesse—largesse that can be taken away with the stroke of a pen. She would be making our very important industries dependent on government subsidies to survive. It is an absolutely ridiculous situation. It is an absolutely ridiculous policy. The Prime Minister also needs to explain the untruths that she is peddling about the rest of the world allegedly running lemming-like to throw themselves over a cliff, just like she is trying to do to the Australian economy. She is trying to claim that the US is making great strides in relation to an emissions trading scheme. The reality is that is false; that is untrue. We saw the 10 western American states abandon their plans for an ETS. We saw the eastern state of New Jersey withdraw from a carbon trading scheme. We saw the closure of the carbon exchange in Chicago.

I see the Labor members shaking their heads. Their constituents are shaking their heads that their local members would be imposing such a tax on them. We see the US retreating from a carbon regime. The New Jersey governor, Chris Christie, said that the scheme:

… does nothing more than tax electricity, tax our citizens and tax our businesses with no discernible or measurable impact upon our environment.

I think he has captured the situation in Australia perfectly.

We have a government that has attempted to mislead the Australian people. We have a Prime Minister who refuses to say why she is imposing this tax. We have a Prime Minister who promised to wear out her shoe leather, but she did nothing of the sort. After a few days out in the field she saw the response the Australian people were giving and she ran for cover—and she has got a lot more running to do before the next election.

Yvette D'Ath (Petrie, Australian Labor Party) Share this | Link to this | Hansard source

Where to start after listening to that! The member for Cowper talked about damage to the economy. I think that he should think long and hard about the way he is talking down the economy in this country, when it is the envy of the developed nations and the G20 countries. If you want to worry about business confidence, start looking at the comments being made by the Liberal Party and its leader.

But let us look at the MPI. That is what we are supposed to be responding to today. It talks about failure to adequately explain, but I think this is a bit of an embarrassment for the other side. They did not really want to word it in the way that they really meant it, so they are saying that we, the government, are not out there adequately explaining it; but it is the Liberal Party not understanding it. It is not a surprise that the Liberal Party does not understand the Labor Party's clean energy future plans, because they do not even know when they get up each day whether they are actually believing in climate change or not. It all depends on what Tony Abbott said on radio that morning.

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

Your constituents don't believe in you!

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

The member for Cowper has had his opportunity.

Yvette D'Ath (Petrie, Australian Labor Party) Share this | Link to this | Hansard source

I have to acknowledge a well-known and very talented actor, Noni Hazlehurst, who was recently on Q&A. She made the comment that she has worked with a lot of children and has dealt with the terrible twos, where two-year-olds just say, 'No, no, no' to everything. I think what has been proven today is that you do not have to be two years old to chuck a tantrum. The member for Indi was very good at chucking a tantrum today, so I think Noni's comment on Q&A the other week was certainly appropriate in relation to the way that the opposition is dealing with policy in this country; it is about opposing everything.

The reality for the Leader of the Opposition, if you want to talk about explanations, is that the people in my electorate are eager to learn more about the clean energy future plan, and we should not treat these people as fools. They do understand. When you go out, when you talk to them and when you provide them with information, they understand why it is important we act, why it is important that we put in place an interim fixed carbon price for three years and why it is important in 2015 that we move to a market based mechanism for a carbon price. They understand this. They understand also that that will come with some cost. They also understand that it is the federal Labor government that is stepping up and providing assistance to households and also supporting industry and jobs and investing in clean energy and renewables.

What the people in my electorate do not understand and are wanting an explanation for is where the opposition think they are going to get the money to support their climate change policy—for what it is worth—to meet what they claim are the same targets that have been set by this government. Today in question time the Prime Minister said that both parties are committed to the same targets. The Leader of the Opposition sat there and shook his head. He shook his head, saying, 'No, no, no; we haven't got the same targets.' So each day we do not know whether they are committed or not to dealing with climate change.

To give the Australian people some insight as to the opposition's commitment to dealing with climate change, we only need to go back to the recent comments by the shadow Treasurer when being interviewed on Lateline by Tony Jones. He was asked: 'You say that if you get into government you are going to scrap 12,000 Public Service jobs. Where would you cut these 12,000 Public Service jobs from?' What about the Department of Climate Change and Energy Efficiency? The shadow Treasurer said that he does not believe any of their modelling. When asked the question, 'Would you consider disbanding the Department of Climate Change and Energy Efficiency?' there were no ifs and no buts—the shadow Treasurer said yes.

It is not just all the jobs that would go—and they are worried about the economy and they are talking about actually taking away jobs—but it is the fact that they say they have a climate change policy at the same time as the shadow Treasurer is saying, 'Oh, if we get into government, there goes the whole department. We don't need a department to look into climate change, clean energy or renewables.'

These are the explanations that need to go out to the Australian people. This is what the Australian people want to hear. If the Leader of the Opposition is going to go out there and run a scare campaign—we heard it from the member for Indi today; we heard it from the member for Cowper—talking about closing industries, loss of jobs, cost-of-living increases and damage to the economy, where is their alternative policy? How is it being costed? Where are all these trees covering the size of Tasmania and Victoria combined going to be planted? We heard the Minister for Climate Change and Energy Efficiency talking about that in question time today.

The opposition talk about alleged increases in the cost of living. Modelling by Treasury has estimated a 0.7 per cent increase on the CPI for our country to take the historic step of addressing climate change and implementing a carbon price. What you do not hear from the other side when they criticise the modelling done by the same department and the same people who did the modelling for the GST is that when the GST was introduced it actually created an increase of more than three per cent on the CPI. But we do not hear them going out and telling everyone that. They would not want to go out and actually compare the Howard government's policies and actions to what this government has done since it came in during 2007, because if they did that they would be embarrassed and shown for what they are: a party that just believes in opposing for the sake of opposing and who want to engage in popular politics—and they do not care what that means. If it means saying one thing one day and something else the other, that is what they will do. The Prime Minister, the cabinet—every member of this government—has been out explaining to people across Australia what this clean energy future plan is all about.

The Leader of the Opposition has been trying to do that, going out talking about Labor's policy, talking about their policy a little bit. He is starting to have a bit of a problem there.

Mr Hartsuyker interjecting—

The Leader of the Opposition just hit a little bit of a snag, maybe, Member for Cowper! Just a little bit of a problem there—he couldn't get into a butcher's. He lined up all of the media to do another stunt. We have done the Weet-Bix and everything else. The Leader of the Opposition tried to set up his little media stunt with a local butcher, but it all came apart because the butcher didn't want a bar of it.

The reality is, despite all the huff and puff from those on the other side—a lot of allegations thrown around—there is very little statistics, very little fact. Why? Because they would rather go out into businesses and run scare campaigns. They would rather go out there, get attention and say that whole industries are going to shut and jobs are going to disappear. But in fact we know that that is not true. Members of the opposition again stood there today making all these allegations—talking about steel, talking about manufacturing, talking about mining but definitely not quoting anyone. Of course they would not want to quote David Cameron, the British Prime Minister, who on 31 July 2011 wrote to the Prime Minister of Australia saying:

I was delighted to hear of the ambitious package of climate change policy measures you announced on July 10 and wanted to congratulate you on taking this bold step.

You would not want to quote Cameron Clyne, the NAB CEO, saying:

“If you’re asking for an economic assessment of the two, the carbon price followed by an ETS is economically superior to the direct action policy,” he said.

“It will drive certainty, it will drive investment, so as a straight comparison between the two, that’s the choice.”

We had comments from the bank chief economist supporting that. We have OneSteel CEO saying:

We believe that on balance, the sectoral approach announced today by the Prime Minister for the steel industry, including the introduction of the STP is both appropriate and sensible. We are pleased that the Government has responded by adopting this approach.

BlueScope managing director and CEO on 10 July said:

This is a pragmatic solution to a complex problem.

None of those quotes were made today by the member for Indi, the member for Flinders or the member for Cowper when they stood here and claimed that jobs would be lost in steel manufacturing, that industries would close down, that there would be cost of living increases. These are all things that the opposition do not want to talk about. (Time expired)

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

Order! The discussion is now concluded.