Tony Abbott (Warringah, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

I welcome the opportunity to speak on this climate change legislation. Let us be absolutely blunt about the bills now before the parliament. This is a bad tax based on a lie and it should be rejected by this parliament. The Prime Minister said yesterday that the question for members of this parliament was: 'Are you or are you not on the right side of history?' Let me say that this is arrogant presumption by a Prime Minister who is on the wrong side of truth. That is the Prime Minister's problem: she is on the wrong side of truth when it comes to this issue.

Let us consider the record of this Prime Minister on this subject. This is a Prime Minister—and we know this happened because her predecessor has described this in public—who sabotaged her predecessor at least in part because of her predecessor's desire to bring in an emissions trading scheme. She brought down her predecessor on this issue, and I say to the Australian people: if Kevin Rudd could not trust this Prime Minister, why should the people of Australia trust her on this subject? Not only do we have a Prime Minister who brought down her predecessor in part on this subject, but we also have a Prime Minister who revealed her true position on this subject in a secret memo to the inner cabinet, where she said that direct action would in fact work, that it was capable of bringing our emissions down by five per cent and it was capable of doing that without a carbon price. That is the one spark of truth that we have seen from this Prime Minister on this topic. But having sabotaged her predecessor over an emissions trading scheme, having told the inner cabinet that direct action would work, she then said to the Australian people at the election campaign that what we really needed was a people's assembly to deal with this whole question of climate change.

This citizens' assembly was not going to meet, listen to a few experts and then quickly decide what the policy was; this citizens' assembly was going to sit, it was going to deliberate, it was going to keep deliberating and it would not come to a conclusion that would be acted upon by government until there was 'a deep and lasting consensus'. So far we have had three positions from the Prime Minister: first, sabotaging her predecessor over an emissions trading scheme; second, telling the inner cabinet that direct action would work; and, third, a citizens' assembly that would not conclude until 'a deep and lasting consensus' was achieved. Talk about a real Julia and a false Julia; the fact is that when it comes to this subject there seems to be no real Julia at all, because having had all of those different positions we come, finally, to her pre-election statement—I would say her fatal pre-election statement—that 'there would be no carbon tax under the government I lead'.

This is the statement that haunts this debate. This is the statement that haunts this government. This is the statement that makes the whole debate we are having fundamentally illegitimate, because this is the very tax that this parliament should not be considering. Let me say this, Mr Speaker: it is one thing to change your mind as circumstances change, it is an entirely different thing to pervert the democratic process of this country by saying one thing before election to win votes and to do the exact opposite after the election to hold onto your job. That is precisely what this Prime Minister has done. What she has not done is the decent, honest thing, which would have been to take a change of position, had that genuinely taken place, to the people at an election.

This is a Prime Minister who has from time to time compared this carbon tax to the great reforms of previous governments. She has even compared it to the great tax reform of the former government of the former Prime Minister Mr Howard. But the fundamental difference between the Prime Minister sitting opposite today and the Prime Minister who took the tax reform package through this parliament is that he took it to an election first. If the arguments for the carbon tax are as strong as this Prime Minister says they are, why hide from the people? Why not expose these arguments to the people? I say to this Prime Minister that if she really does want a deep and lasting consensus to be attained in this country, there is one way to do it, and only one way to do it: take it to the people and win an election on it. I say to this Prime Minister: there should be no new tax collection without an election. That is what this Prime Minister should do. If this Prime Minister trusts in the democratic process, if this Prime Minister trusts her own judgment, trusts her own argument, that is what she should be doing—she should be taking this to the people.

The whole point of this tax is to change the way every single Australian lives and works. That is another reason that this should be taken to the people. This is not just a minor bit of financial engineering. This is not just, if you believe the government, something to do with the revenue. This is a transformational change. This is something which is supposed to impact on our country not just today, not just next year, not just next decade, but forever. That is how important this is, if the government is to be believed, and this is why it should go to the people first.

This tax is all about making the essentials of modern life more expensive. Modern life is utterly inconceivable without fuel and power—without fuel to move us around the country; without power to make our homes, our businesses and our factories work. So, if this tax comes in, as the government wants it to do, we will not be able to turn on our air conditioner or our heater without being impacted by this tax. We will not be able to get on a bus or a train or, ultimately, drive our cars without being impacted by this tax. That is how important, how significant, this tax is. This explains the obvious impact that this tax will have on every single Australian's cost of living. This explains the obvious impact that this tax will have on every single Australian's job. And this explains why it is so necessary for this tax to go to the people before the parliament tries to deal with it. If this parliament is to have any democratic credibility on an issue like this, there must be an appeal to the people before a decision by the parliament.

The longer this debate lasts, the clearer it is that this tax is all economic pain for no environmental gain. On the government's own figures, under this tax there will be an immediate 10 per cent increase in electricity prices, a nine per cent increase in gas bills and a $4.3 billion hole in the budget. That nine per cent increase in gas prices and that 10 per cent increase in electricity prices is what we will get—well, we are not quite sure whether it is what we will get with a $23 a tonne carbon price or a $20 a tonne carbon price because they still have not given us the modelling on this. But once the price goes up to $29 a tonne—or to $131 a tonne, as it is forecast to do on the government's own figures—these prices for gas and electricity just go up and up and up. And that is the last thing that the people of Australia need, given that they have suffered from price rise after price rise in the 3½ years since this government came to office.

Let us look at what the Australian Bureau of Statistics tells us. Let us look at the story of price rises under this government. There has been a 51 per cent average increase in power prices. There has been a 30 per cent average increase in gas prices. There has been a 46 per cent average increase in water prices. There has been a 24 per cent average increase in education costs. And there has been a 20 per cent average increase in health costs. All of these prices are going to go up and up and up under a carbon tax.

As members opposite are only too well aware, since the carbon tax was first announced at the press conference in the prime ministerial courtyard, hijacked by Senator Bob Brown, and since carbon Sunday, I have been spending quite a bit of my time going around to the workplaces of Australia talking to the workers of this country—who, I regret to say, have increasingly been abandoned by members opposite. Just to give you a snapshot of some of the increases that will be faced by the employers of those workers that the Labor Party once represented: Austral Bricks—a $2 million a year additional cost; the Victorian hospital system—a $13½ million a year additional cost; Nolan's Transport in Gatton—a $300,000 a year additional cost. And it just goes on and on and on.

This is at a time when Australian business, particularly Australian manufacturing business, is under great pressure. This is at a time when the world financial situation is experiencing unprecedented fragility. And what does this government do? They do not think: 'Now is not the time to add to the burdens on business. Now is not the time to add to the burdens on families. Now is not the time to add to sovereign risk issues associated with Australia.' They do not think any of that. No, they think: 'What we need now is just another big new tax.' On top of the mining tax and all the other taxes that they want to put on us, they want a carbon tax as well. We heard from the Prime Minister yesterday that the carbon tax is somehow going to create jobs. This is a government which sometimes talks about economic credibility. Show me a credible economist, Prime Minister, who thinks that higher prices create more jobs. Show me a credible economist who thinks that higher taxes create jobs. This is not just nonsense; this is nonsense on stilts by a government which has no real understanding of the economy of the real world in which most of us live.

This government constantly tells us that the modelling shows most people will be better off. Well, there is modelling and there is modelling. This is a government which says that the modelling of the Commonwealth Treasury—and, as I said, it still has not given us the correct modelling—shows people would be better off. Well, that is not the only modelling. The Victorian government commissioned Deloitte Access Economics. Their modelling showed that there would be 23,000 fewer jobs across Victoria by 2015 as a result of the carbon tax—and members opposite should listen to this—with the Latrobe Valley, Geelong, Port Phillip, Monash, Boroondara and Whitehorse the worst hit areas. The Victorian government's modelling says that the Victorian economy will be $2.8 billion worse off in 2015 thanks to the government's carbon tax.

The New South Wales Treasury modelling—and this was modelling originally undertaken for the New South Wales Labor government when Michael Costa was the Treasurer of New South Wales—predicts that 31,000 jobs will be lost in New South Wales by 2030 as a result of the carbon tax, with 18,500 in the Hunter Valley alone. I say to members opposite representing Hunter Valley electorates: stand up for jobs in your area; stand up for the jobs of your constituents; stop making excuses for a floundering Prime Minister; and stop putting the political interests of this Prime Minister ahead of the economic interests of your constituents.

The New South Wales government predicts that state finances will be $1 billion worse off between now and 2014, with—listen to this, Mr Speaker—a reduction in gross state product of close to one per cent per year by 2020, and that electricity prices in New South Wales will rise by $498 next financial year as electricity generators pass on the cost of their carbon permits. The Western Australian Treasury modelling predicts that within three years Western Australian households will be paying more than $2,120 per year for power compared with $1,515 per year now.

Members opposite will say: 'They're just the coalition states. What can you expect from modelling commissioned by coalition governments?' Well, let us go to the Queensland modelling. The Bligh government commissioned a report from Deloitte Access Economics, and that modelled that Queensland's gross state product would be 2.76 per cent lower by 2020 and 4.11 per cent lower in 2050 with the carbon tax than it would be without one. That is a five per cent reduction in Queensland's gross state product under the carbon tax. Deloittes predicted a loss of 21,000 jobs in Queensland. And then there is the Queensland Treasury, which anticipates a net loss in the economic value of the state's generation companies of $640 million, all of which ultimately will be passed on to consumers.

Nearly all the claims that this Prime Minister is making for her carbon tax are wrong. It is a bad tax based on a lie, and the argument that she is marshalling for this tax is one lie after another. She talks about green jobs. A United Kingdom study released in March this year found that for every job created in the renewable energy sector 3.7 existing jobs were lost. A 2009 Spanish study found that for every green job created by subsidies and price supports for renewable power more than two jobs in other industries are lost. Her claims that no-one need worry about this tax because everyone is going to be compensated are wrong, even based on her own figures. Her own figures, in her own carbon Sunday documents, show that more than three million Australian households will be worse off.

These are not just rich people. A teacher married to a shop assistant: worse off under the government's package even by the government's own figures. A policeman married to a part-time nurse: worse off, under the government's own figures, thanks to the carbon tax. A single-income family with a child, on the government's own modelling, starts to be worse off from below average weekly earnings. That is what this government is doing to the struggling families, the forgotten families, of Australia.

The Prime Minister tells us that we have to introduce a carbon tax to keep up with policies in the rest of the world. Dead wrong. Since Copenhagen, if anything, the rest of the world has been moving against carbon taxes and emissions trading schemes, and in the period in which Australia intends to reduce its emissions by five per cent China is forecast to increase its emissions by 500 per cent and India its by 350 per cent.

Let me now come to the heart of my objections to this government's carbon tax proposal: it will not even reduce emissions. Every member of this parliament should go to page 18 of the government's 'carbon Sunday' document, Strong growth, low pollution: modelling a carbon price. I am looking at the government's own document. Our current emissions are 578 million tonnes. What we are supposed to be doing if we are to reduce our emissions by five per cent on 2000 figures is getting it down to 530 million tonnes. But the government's own figures do not say that we are reducing our emissions by five per cent; the government's own figures say that we are in fact increasing our own domestic emissions from 578 million tonnes to 621 million tonnes.

Ms Julie Bishop (Curtin, Liberal Party, Deputy Leader of the Opposition) Share this | Link to this | Hansard source

What's the point?

Tony Abbott (Warringah, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

What is the point? What is the point of all the pain of this carbon tax if our emissions are actually going to increase? But it just gets worse. At a $29-a-tonne carbon tax, our emissions go up from 578 million tonnes now to 621 million in 2020. It gets worse. At a $131-a-tonne carbon tax in 2050, we do not get an 80 per cent reduction in emissions; we actually get a six per cent reduction in emissions. Our emissions in 2050, on the government's own figures, will have gone from 578 million tonnes to 545 million tonnes. So all of those bold claims in the Prime Minister's speech yesterday—all of that big chest-thumping talk of a massive reduction in emissions as a result of this tax—are utterly wrong and disproven on the basis of the government's own documents. We are not reducing our emissions; we are just engaging in a massive transfer of wealth from this country to carbon traders overseas.

That is what is happening under this tax. It will be $3.5 billion in 2020 to purchase almost 100 million tonnes of carbon credits from abroad. It will be $57 billion—1½ per cent of gross domestic product—shovelled off abroad by 2050 to purchase some 400 million tonnes of carbon credits from abroad. The Prime Minister claims that we are all going to get richer and richer under this carbon tax. Again I say to members opposite: if you do not believe me, look at your own modelling document, which says that Australia's gross national income per person will be almost $5,000 less in 2050 with the carbon tax than would be the case without it.

So what is the point of this carbon tax? We know part of the point: to satisfy the Greens, without whom this Prime Minister would not be in the Lodge and would not have been able to cobble together a majority after the election. But that is not the only point. Deep in the DNA of every Labor member opposite, I regret to say, is an instinct for higher taxes and greater regulation. And isn't that just what we are getting under this carbon tax proposal—more taxes, more bureaucrats, more regulation, more burdens on the life of the Australian people and more economic pain for no environmental gain whatsoever?

As I have been saying right around the country ever since this was proposed, there is a much better way to reduce emissions, and the better way to reduce emissions is to work with the grain of the Australian people and to further encourage the intelligent, sensible things that Australians and Australian enterprises are doing now to reduce emissions. Australian farmers are planting more trees, and they are doing it now without a carbon tax, because they know it is good for our environment and for their agricultural productivity. Australian farmers right now are moving from chemical to organic fertilisers. They are reducing emissions, and they are doing it not because of a carbon tax but because it makes economic and environmental sense. Australian businesses are taking sensible measures to reduce their fuel bills and power bills. Linfox has better trained its drivers and, as a result, its total emissions have reduced by 35 per cent since 2007. Visy are moving from high-emitting power from the Latrobe Valley to power that they are producing by burning the garbage that cannot be recycled. This is not just zero-emissions energy; this is negative-emissions energy, because that garbage would otherwise be emitting not just carbon dioxide but also methane in landfills. They are doing all of this without a carbon tax, and none of this would be easier—in fact, all of it would be harder—with the carbon tax that this government is proposing.

Listening to the Prime Minister, you would think Australians have been complete environmental vandals until this government came along with its carbon tax. I can tell the Prime Minister that, because of the environmental decency and economic common sense of Australians and Australian businesses, our emissions intensity is 50 per cent down over the last decade and a half, and all of that happened without a carbon tax. All of that is going to be put at risk by the carbon tax which this Prime Minister now wants to put in place. True environmental progress will be harder with a carbon tax. True environmental progress will be encouraged and facilitated by the direct action policies of this coalition. Let me say that, when it comes to our direct action policies, they are costed, capped and fully funded from savings in the budget. This carbon tax proposal from the government would be disastrous for our democracy. How can Australians continue to trust our democracy when the biggest and most complex policy change in recent history is being rammed through this parliament by the most incompetent government in recent history? It is the biggest and most complex change sponsored by the least competent government in recent times. Not only does this government not have a mandate to do what it is proposing; it has a mandate not to do what it is proposing. That is why this package of bills is so disastrous for our democracy.

It is disastrous for our democracy, and it is disastrous for the trust that should exist between members of parliament and their electorates. Why are the members for Throsby and Cunningham sponsoring such damage to BlueScope and to the coalminers of the Illawarra? Why is the member for Hunter and the other Hunter Valley members of the government doing such damage to the heavy industries and to the coalmines of the Hunter? How can the Climate Change minister talk to his constituents with a straight face, given what he is doing to them? How can the member for Capricornia want to close down so many mines in her electorate? How can the members for Corio and Corangamite be doing this to the cement industry and to the aluminium industry and to the motor industry of Geelong? What we have from this government is politically, economically and environmentally disastrous. But it is more than that; it is going to turn out to be the longest political suicide note in Australian history.

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

It is with great pride that I rise today to speak on the government's Clean Energy Future plan. In my first speech to this House three years ago I spoke about my hopes for this country's future, and I spoke about my belief that we should live in this land in a way that will leave it improved on our passing and not depleted. I spoke about my belief that we have a duty to sustain our land for the sake of our children and our children's children.

After decades of parliamentary debate about climate change, we have before this House a plan that has majority support within this parliament, a plan that will cut carbon pollution and drive investment in clean energy technologies and infrastructure, like solar, gas and wind. It will help build the clean energy future that current and future generations deserve, and it will ensure Australia's continued prosperity while decoupling economic growth from emissions. Put simply, this plan will leave our country improved on our passing and will deliver a better environmental and economic future for our children's children.

Central to the government's plan is a carbon price. While climate change science tells us we need to act, economic understanding tells us the most cost-effective ways of doing so—two fields that those opposite appear to have an inability or an unwillingness to grasp. Putting a price on carbon is the most environmentally effective and cheapest way to cut pollution. This is a fact that is well recognised by economists from Australia and around the world and respected institutions such as the Organisation for Economic Cooperation and Development and Australia's Productivity Commission.

Releasing carbon pollution is currently free in Australia, despite the catastrophic threat carbon pollution poses to our environment. To tackle climate change, therefore, we need to correct what is routinely called the 'greatest market failure the world has ever seen'. The government's carbon price mechanism sends a powerful price signal to the market that the emission of harmful carbon dioxide into the atmosphere can no longer occur without consequences. It gives effect to Australia's international obligations under the Climate Change Convention and the Kyoto protocol and ensures that Australia is on track to meet its long-term target of reducing net greenhouse gas emissions to 80 per cent of 2000 levels by 2050. And, as we know from the experience of other nations and regions, a constraint on carbon pollution will drive innovation across the economy. It will provide the incentive to find new energy and carbon efficient ways of doing business to invest in new low-carbon products and processes, and it will stimulate the scientific and engineering research that complements our transition to a low-carbon future.

Starting at a fixed price in 2012-13 and then moving to an emissions trading scheme, the carbon price will generate incentives to reduce pollution and invest in clean energy, breaking the link between pollution and economic growth. This is what the eminent economist Sir Nicholas Stern calls the new industrial revolution. Under the mechanism, around 500 of the country's biggest polluters will be required to pay for each tonne of pollution they release into the atmosphere. This creates a powerful incentive for all businesses to cut their pollution by investing in clean technology or finding more efficient ways of operating.

A price on carbon will also create economic incentives to reduce pollution in the cheapest possible ways, rather than relying on more costly approaches such as government regulation and direct subsidies. These incentives will flow through the economy. A carbon price will make lower polluting technologies, especially clean energy technologies, more competitive and will boost investment in those technologies in this way. Introducing a price on carbon will trigger the transformation of the economy towards a clean energy future.

Carbon pricing and climate change policy have been widely debated in Australia for well over a decade, including through no less than 35 parliamentary committee inquiries. The first review of emissions trading by an Australian government was in 1999, some 12 years ago. There was extensive policy work undertaken by the former Howard government, most notably by Peter Shergold, which concluded that pricing carbon was the best approach. The member for Flinders should be ashamed of his current stance. He spoke in 2008—and I am pleased he is here to listen to what he then said about the Howard government's plans for a carbon price. He said:

Perhaps the most important domestic policy in recent years has been the decision by the Howard government that Australia will implement a national carbon trading scheme. The task group on emissions trading established by the previous government concluded that Australia should not wait until a genuinely global agreement had been negotiated. It concluded that there would be benefits which outweigh the costs of early adoption by Australia of an appropriate emissions regime. The task group was also firmly of the view that the most efficient and effective way to manage risk would be through market mechanisms. The announcement in September last year by the previous government of a new national clean energy target was another important step towards a comprehensive national emissions trading scheme. Importantly, the coalition pledged to establish a climate change fund to reinvest a substantial proportion of emissions trading revenues in clean energy technology and support for households most affected by the impact of a price on carbon—in particular, low-income families and pensioners.

He said, 'We hope that the new government will take up this proposal.' Of course, we have taken up those proposals. In addition, Professor Ross Garnaut has conducted two major reviews on Australia's best policy options for tackling climate change.

The government's Clean Energy Future package was developed through a parliamentary committee process, the Multi-Party Climate Change Committee, which met for nine months before completing its work in July this year. The federal coalition, the Greens party and the Independents were invited to participate in the Multi-Party Climate Change Committee. Only the coalition declined. Today, from the Leader of the Opposition, we have heard yet more of the misinformation, seemingly wilful ignorance and relentless negativity that, regrettably, we have come to expect from the opposition over the past several months.

Moving to a clean energy future will provide new economic opportunities for Australia and its businesses and workers. Opportunities will open up in existing businesses. Jobs will be created in clean industries such as renewable energy generation, carbon farming and sustainable design, to name just a few. The government recognises that it is now time to act, to harness these opportunities. We recognise that if Australia fails to enact this vital reform the costs of tackling climate change will only become greater in the years ahead. Undertaking this reform will ensure Australian businesses remain globally competitive in the decades ahead.

The Gillard government recognises that the transformation of the economy to a clean energy future presents opportunities for industry but also challenges. Dynamic and competitive industries are essential for Australia's economy and for jobs. We are a Labor government and our priority will always be jobs. That is why the Clean Energy Future plan includes measures to support industry and jobs. The Jobs and Competitiveness Program will support jobs in high-polluting industries that have competitors in countries where those industries are not yet subject to comparable carbon constraints.

Over the first three years of the carbon price the government will devote $9.2 billion of the carbon price revenue to assistance for affected jobs in these industries. This assistance will be in the form of free carbon permits and will shield those business activities from the impact of a carbon price while maintaining incentives to invest in clean technologies, which will underpin their competitiveness as the world moves to price carbon pollution.

The Jobs and Competitiveness Program is not the panacea for supporting manufacturing in Australia. Under a carbon price it is essential that the government assists manufacturing directly, in improving energy efficiency and supporting research and development in low-pollution technologies. The government is also helping households and businesses improve their energy efficiency. The government's Low Carbon Communities program will be expanded to provide funding to local councils and communities to improve energy efficiency in council and community-used buildings and to assist low-income households.

Turning to the land, the government has excluded the agricultural and land sectors from the carbon price but these sectors will still have opportunities to secure economic rewards under the Carbon Farming Initiative. The farming, forestry and land sectors have as important a role to play in reducing carbon pollution as governments, households and other industries. The Carbon Farming Initiative rewards farmers and landholders who take steps to reduce carbon pollution above what commonly occurs. It works by creating credits for each tonne of carbon pollution which is stored or reduced on the land.

The Carbon Farming Initiative legislation, passed in the parliament last month, will commence operation from December this year. It will create a new income stream for farmers and new jobs for rural and regional Australia and will provide strong incentives to identify and implement low-cost methods of pollution reduction. Credits generated under the Carbon Farming Initiative and recognised for Australia's international obligations under the Kyoto protocol on climate change will be able to be sold to companies with liabilities under the carbon pricing mechanism. This includes credits earned from activities such as reforestation, savannah fire management and reductions in pollution from livestock and fertiliser use. People on the land will have an opportunity to earn new streams of income and contribute to the national effort to tackle climate change. The government will initially be investing around $1 billion in land sector measures over the next four years to support the Carbon Farming Initiative to reduce emissions and to maximise the benefits of storing carbon in our landscape.

It is resoundingly clear that if we do not reduce carbon pollution the world risks catastrophic consequences from climate change. The consensus among the scientific community is that our climate is changing and that human activity is causing it. In Australia and other polluting nations we must take action to cut carbon pollution if we are to prevent dangerous climate change. We know that fair and effective global action to achieve ambitious emissions reductions is in Australia's national interest. We need to demonstrate that we are willing and able to do our part.

The Gillard government is committed to ambitious pollution reduction targets as our contribution to global action. The bills before this House will put in place policies capable of delivering these targets. There is an optimism about Australia's low-carbon future, and it is an optimism shared by many countries around the world, most notably the United Kingdom. That is why the Prime Minister of the United Kingdom, David Cameron, wrote to congratulate our government for its announcement of the Clean Energy Future plan. The United Kingdom government understands—regrettably, our political opponents here in Australia appear not to—that the future of the 21st century lies in a low carbon economy. Unfortunately, amidst the optimism about Australia's low-carbon future, there skulks the Liberal-National coalition, wedded to old, dirty and inefficient technology, who have perfected the art of obstructionism and the drumbeat of no, no, no. The opposition have spent the previous year in hysterics over the carbon price mechanism. They have attacked the scientists and they have attacked the economists who are urging us to act. They pander to climate change deniers with an extraordinary level of wilful ignorance.

As representatives of all Australians we will be judged by our actions. Climate change is a global problem; it is a generational problem. Our strength in the debate as it unfolds over the coming months—the strength of the Gillard government and those who stand with us—will ensure the future prosperity of Australia and ensure that Australia is able to take its place with the other countries in the world who are taking action on climate change. I would urge members of the opposition who believe in this cause, members of the opposition who have publicly supported policies to put a price tag on pollution, to be courageous. We know that almost half of those opposite us support pricing carbon, support an emissions trading scheme. That is the policy that their party took to the 2007 election. That is the policy that their party supported right up to the end of 2009. I say to all those opposite, including the member for Flinders, that now is the time to cross the floor and vote for the Gillard government's plan for a clean energy future. You will be remembered for your actions, as indeed Senators Boyce and Troth are remembered for their action in crossing the floor in the Senate in late—

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

Troeth.

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

Troeth, I am sorry.

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

You made a point about remembrance!

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

Yes. From 1 July 2012, Australia will have a carbon price. I call upon all those opposite who wish to see the action we need on climate change to support these bills, as a majority of the members of the House of Representatives and a majority in the Australian Senate will be doing. (Time expired)

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

Let me begin in Hastings, in my electorate of Flinders. Mick Carroll is the proprietor of Carroll's Injection Moulding. It is a firm which, when you include him and his wife, employs six people as of my last discussion with him. Carroll's Injection Moulding is a proud Australian firm—Mick and a number of members of the firm are part of the Mount Martha Fire Brigade—but it has to compete against international imports into Australia. What Mick has told me is a story that has been repeated around Australia. He said: 'I'm proud of the environmental savings we have made within our firms, but the increase in electricity and gas prices under the proposed carbon tax is likely to be the final straw and I will have to export much of my manufacturing offshore and some of these six workers will lose their jobs.' That is what Mick Carroll has said. That has been the story around Australia in so many places, from so many people, and what it means is that global emissions will not go down but that Australian jobs, investment in Australia and Australian emissions will be exported to China, India, Indonesia and other countries with different regimes. In many cases, the emissions for the projects in question will go up if they are occurring in a less developed environment.

So let us begin with the heart of the matter, and that is that this scheme at this time in this form will not reduce Australia's emissions and it will not reduce global emissions, but it will hurt real people with real jobs and it will hurt every Australian who has to pay electricity bills, gas bills and grocery bills. But there is a choice. There is fundamentally a better way than a massive tax on electricity, gas and groceries, and it is an exemplar of the two philosophies in contest in this chamber. One is a philosophy of tax and punishment. The other one is a philosophy of incentive, hope and optimism. That is what we bring to this chamber, that is what we bring to the Australian people—and, strangely enough, that is what the Prime Minister purported to bring to the last election when she ruled out a carbon tax.

In speaking on the Clean Energy Bill 2011 and related bills, I want to proceed in four clear themes: firstly, democratic respect; secondly, the truth about international action and where Australia fits in that; thirdly, the flaws in the tax itself and, in particular, the inelasticity on a relative basis of electricity, the impact on families, the impact on the economy and the true cost in economic terms of what is being proposed here; and, fourthly, the fact that there is an alternative, a better way, which is effective, costed, capped and fully funded from offset savings.

Let me turn first to the notion of democratic respect. The nature of democracy is that parties take to the people a platform on which they seek election. Their fundamental duty is to outline that platform, to seek a mandate and to implement that platform.

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

Rubbish.

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

There will be moments when it may have to change, but not the fundamental nature—

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

Rubbish.

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

I have had enough of you, mate. I have had enough of you, with your performance, coming into this chamber and lecturing people on democracy, when you did not seek information about the mining tax, you did not seek information about water trading, you turned a blind eye to your constituents. So no more cant or hypocrisy. Your electors will no doubt make their own judgment in due course.

The nature of democracy is this: we have a duty, we have a responsibility, we have a task, to set out what we seek, to ask for the people's mandate and to implement it. This Prime Minister, not just once or twice but on multiple occasions, made it clear, firstly, that there would be no carbon tax and, secondly, that there would be no pricing mechanism until there was 'a deep and lasting community consensus'. On the carbon tax, the Prime Minister said clearly and absolutely prior to the last election:

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

We all know about 16 August. We all know about 20 August, the day before the election, when the Prime Minister said:

I rule out a carbon tax.

That was the Prime Minister's final pledge and pitch to the Australian people to seek a mandate not to do precisely what she is doing today. I seek leave to table the Prime Minister's 13 statements during the course of the election campaign.

Leave not granted.

Leave is not granted to table the Prime Minister's 13 statements to the Australian people that she would not introduce any form of carbon pricing until there was a 'deep and lasting community consensus'. That was a statement of principle, that was a statement of belief and that was a statement of commitment. All of this was broken and none of it had to be. The reason it was broken was it was always intended to be broken. It was an act of deliberate deception from the outset.

On the night of the election, the incoming member for Melbourne told the Australian people that he would support the ALP. That was before any deal, before any agreement. Every member of this House knows that the Greens were going to support the ALP. That was set out in public on election night. So the Prime Minister's claim that circumstances changed is false. Circumstances did not change. She was always going to have the agreement of the Greens. With that we saw that the democratic respect owed to the Australian people was fractured. The Prime Minister should take this to an election to seek a mandate for a tax, which she ruled out repeatedly prior to the last election.

Let us turn to why it matters beyond sheer democratic principle, which itself should be enough to seek an election in order to enact these proposals if the Prime Minister has changed her mind. The international reality sets out the environment in which this policy will operate. It makes it all the more likely that this policy will fail. Let us look firstly at China. Contrary to what the Prime Minister would have us believe, China is going through the fastest growth in human emissions in history. We will see a 496 per cent increase in Chinese emissions between 1990 and 2020. We will see coal consumption grow from 1.4 billion tonnes to four billion tonnes between 2002 and 2015. We will see Chinese emissions grow from 5 billion tonnes to 12 billion tonnes, or seven billion tonnes of growth alone, which is approximately 100 times what this entire bill is seeking to achieve in reductions over the same period from 2005 to 2020 in Australia's net emissions. That is the reality and there will not be a carbon tax with an effective increase in electricity prices on a systemic basis across China. There is no chance of that. I believe all members of this House know that.

Secondly, in India, similarly, there will be no systemic carbon tax. We will see a 350 per cent increase in Indian emissions between 1990 and 2020. In the United States a cap-and-trade system, which is their equivalent of a carbon tax, is absolutely dead and buried. The modelling upon which the Prime Minister relies includes an assumption that the United States will have a system which will be a full part of an international trading system by 2016. That is a completely false and unsustainable assumption and no member of the government has been able to point to any evidence in the United States from a legislator, from a member of the cabinet or from White House officials which justifies that assumption. It is an utterly unsustainable assumption.

Europe does have an emissions trading scheme but it is a radically different system to what is proposed here. The European system, on a per capita basis, is just more than $1 per person per annum across the economy. The Australian system will be approximately $400 per person per annum. Just over $1 per person per annum in Europe and approximately $400 per person per annum in Australia is radically different. It is the difference between a bowling ball and a feather. All of that affects how this tax will operate in Australia. It means that we will simply be sending our emissions, our investment and our jobs offshore.

The flaws in the tax itself are these: firstly, it relies upon an assumption that somehow people will either change the demand for or supply of electricity. But electricity, on a demand basis, is inelastic—not absolutely but significantly. New South Wales IPART showed us a 50 per cent rise in the cost of electricity across multiple millions of people over five years—so a massive economic test case—saw a six per cent decrease in per capita consumption. We see it as an incredibly blunt and ineffective mechanism backed by economic history, backed by economic reality, backed by economic fact as found by New South Wales IPART under the previous Labor government in New South Wales.

Secondly, there will be no significant change in supply under this proposal, as the government has recognised, because the only way they will try to change supply is by turning to the coalition's approach of direct incentives on a competitive basis to clean up power stations, although they would go further and close them, which we reject. They will adopt the coalition's own mechanism because their approach of trying to tax them will not be effective, because the power stations simply push through the prices.

At the heart of their mechanism is an acknowledgement that neither supply nor demand will be changed, which is why they will have to go offshore to purchase their emissions. Their tax will see emissions in Australia increase by 43 million tonnes from 578 million tonnes to 621 million tonnes by 2020. How will they do this? They will go offshore to buy almost 100 million tonnes of credits from China, from India, from Indonesia at a cost of $3½ billion by 2020. That is money that will go straight from Australia to countries overseas. There has been some debate about whether this will come from taxpayers. Of course it will come from taxpayers in the form of higher electricity, gas and groceries. It will then go to companies that purchase from overseas. It will be Australian taxpayers who will bear the costs of these purchases of foreign carbon credits. The Australian Crime Commission found this year that there was a $5 billion fraud in Norway, a mature country, under the very type of system that this government is proposing and that was in a radically smaller market than the one it is proposing here. So if you think pink batts and green loans were bad, you ain't seen nothing yet.

That leads me to the true economic cost of what is proposed here. The true economic cost is very simple. The cost of domestic abatement under this system is more than $160 per tonne of abatement. How does that come about? It is because it is a $9 billion a year tax. We are reducing only 58 million tonnes in Australia—the rest comes from offshore. The effective cost of abatement in Australia is over $160 a tonne. If you take out the 20 million tonnes that they are proposing to save per year by cleaning up power stations using our direct action method of purchasing then you find that the actual cost per tonne of abatement from the tax alone in its economic form is more than $200 per tonne. That is why Nobel economic laureates from the last decade, such as Thomas Schelling, Vernon Smith and Finn Kydland, have declared that a carbon tax is the least effective way of reducing emissions on a cost-effective basis if you want to use an economic instrument.

That is the heart of the matter. That is why we have proposed direct action in the form of a market based reverse tender to buy emissions at the lowest cost wherever they can be found. That is within the Australian context. Every dollar will be spent in Australia. It is costed and it is capped; therefore, that is the amount we will spend—not a dollar more than we have budgeted. This is the difference ultimately between a mentality of tax and spend and a mentality of incentives and creation. That is what we stand for and that is who we are.

Andrew Leigh (Fraser, Australian Labor Party) Share this | Link to this | Hansard source

Over the past few decades, as we in this place have debated solutions to climate change, climate science has become increasingly unequivocal: the world is warming and human beings are causing that warming. This parliament sits in a city that shares a close connection to the natural environment. The bush capital is particularly vulnerable to climate change. Unchecked climate change over the next five decades could subject Canberra to more high and extreme fire danger days, more frequent droughts, more scorching hot days when elderly people and young kids cannot go outside, and less water in our dams. We cannot blame climate change for any single extreme event but we know that more of them will impose a greater cost to households. Canberra's devastating bushfires in 2003 delivered a damage bill of a third of a billion dollars to what was then just a $16 billion economy. If you increase the probability of extreme fire danger days then you increase the expected cost of bushfires.

One way of regarding climate change mitigation is as a form of insurance. I am not in the habit of regularly quoting Rupert Murdoch, but he says:

Climate change poses clear, catastrophic threats. We may not agree on the extent, but we certainly can't afford the risk of inaction.

If you accept that asbestos is very likely to cause malignant mesothelioma and that bad cholesterol is very likely to increase the risk of a heart attack then you should accept that our greenhouse gas emissions are very likely causing global warming.

The coalition like to flirt with climate change deniers. Their Western Australian branch recently called for a royal commission into climate change science. But in their official policy the coalition have recently accepted the science and agreed to an emissions reduction of five per cent on 2000 levels by 2020, so the question we in this chamber have to think about is: what is the best way of getting to that bipartisan target? The choice is clear: direct action or a market based approach.

The problem is that the coalition's policy is indirect and it will not take action in the most effective way. When you reject a market based mechanism and place your faith in command and control you lose a lot of flexibility. You can see this if you look, for example, at Australia's projections of renewable energy growth in the decade from 2000 till 2010. At the start of the decade experts projected that two-thirds of the renewables growth would come from bagasse and none from wind. By the end of the decade bagasse had contributed less than one-tenth of the renewables increase while wind had contributed nearly half.

When you reject the market based mechanism you do not tap the ingenuity of the market. You lock yourself into an inflexible system. We should never forget that a price on carbon pollution is not just a disincentive to polluters but also an incentive to investors and entrepreneurs looking to invest in renewables. Joshua Gans, one of Australia's brightest economists, said about the two contrasting policies:

The point is that this game could go on and on with very little impact and possibly negative impact on total emissions. And there is example after example of this. Think of the taxes required to employ all the inspectors and personnel to ensure that regulations are doing what you wanted without unintended consequences. Sure, it can be done but you will need a government that would make Lenin blush to make it happen.

Contrast that with a carbon price—by tax or trade. That requires none of this because it hits directly on the problem: emissions create external costs so we need everyone to build that cost into their decision-making. The problem is, as right-wing economist Frederick Hayek pointed out, that no-one has the information required to plan out what individuals might do themselves. By placing the decisions of environmental management in the hands of the people, you can let things work themselves out in a way the heavy-handed Government involvement cannot.

He went on to say:

I can’t parse the dual hypotheses that either the Coalition just deny economic evidence or that they actually want more emissions and handouts to business. Perhaps one of their number can enlighten us.

Professor Gans is not alone in favour of an approach which prices carbon and allows business to innovate in their solution. A poll of members of the Economics Society of Australia, released at the July Australian Conference of Economists, found that 79 per cent agreed with carbon pricing and only 12 per cent supported direct regulation. This is not some complicated economic theory. It is based on lessons from first-year economics. The best way of addressing a negative externality is to put a price on it. And it is not unproven theory either. In 1989 when US President George HW Bush proposed the use of a market based mechanism to deal with acid rain, the electricity generators warned that costs would skyrocket. Today, that market based emissions trading program is universally regarded as a success. It achieved its emissions targets at around one-third of the projected costs.

Why was it so successful? Researchers found that firms used a variety of approaches to reduce emissions. Some of them retrofitted emissions control equipment. A number switched to cleaner fuels. Others retired their dirtiest generators. Because each firm took the lowest cost approach to abatement, the social cost was minimised. Those opposite used to subscribe to such an approach. In 2007, their election manifesto said, 'A re-elected coalition government will establish the world's most comprehensive emissions trading scheme.'

Whenever I speak at schools and universities, I meet young Australians who are optimistic about a clean energy future and want us to get on with pricing carbon. They get the science and they want us to act. Young people can and do make a positive contribution on environmental debates. Indeed, in 1990, one young person argued that a 'pollution tax is both desirable, and, in some form, is inevitable'. That young person pointed out that the national interest must be favoured over sectional interests, saying 'even if some of the Liberals' constituents do respond negatively, a pollution tax does need to be introduced to properly serve the public interest'. Who was this young person? It was the member for Flinders, and his remarks were from his law honours thesis.

I cite his work not as some cheap political trick in this place but rather as demonstration that there are still some opposite who deep down know that the advice of experts and economists is right, that acting on climate change using the most efficient means possible is the right thing to do. As recently as 28 April 2008, the member for Flinders told a Sydney audience:

Perhaps the most important domestic policy was the decision of the Howard Government that Australia will implement a national carbon trading system.

But the reluctance of conservatives to listen to the best advice is not new. We know that Senator Minchin, political godfather for many of those opposite, did not accept the scientific evidence on the need to act on smoking or on climate change, which he believes to be some 'vast left-wing conspiracy to de-industrialise the world'.

Former Liberal Premier of New South Wales Nick Greiner lamented this approach, saying in 1990:

Regrettably, too many people on the conservative side of politics still view environmental consciousness as some sort of left-wing conspiracy Amongst both the Liberal and National Parties there is still a cringe when the environment is mentioned, a subconscious aversion that arises, I believe, from a misconception that there is some fundamental philosophical inconsistency between environmental consciousness and democratic capitalism.

Sadly, more than 20 years on, those remarks have never been more relevant.

Recent history, including the Liberal Party's leadership change in December 2009—which is a great example of the fact that tipping points really do matter on the issue of climate change—lays bare this reality. Pricing carbon is in the traditions of capitalism. Business recognises this and has been calling for certainty in this policy area. For example, the Energy Supply Association of Australia called for a well-designed emissions trading scheme back in February 2007. Nathan Fabian of the Investor Group on Climate Change has said:

Delaying the introduction of a carbon price is a false economy. We know we must achieve lower domestic emissions, send clear investment signals and support a stronger international agreement. It's time to get on with the job.

Like the Carbon Pollution Reduction Scheme, the Clean Energy Future plan that we are debating today has a fixed-price period which, yes, operates like a tax, followed by a floating-price emissions trading scheme.

For those who dislike fixed prices, also known as carbon taxes, I have good news for you. After 2015 there will be no carbon tax. Under a carbon price, our economy will continue to grow. More than 1.6 million jobs will be created, jobs in clean and renewable industries, jobs in industries that are yet to develop.

The revolution is already taking place. In my own electorate we have students in industries taking advantage of this. Earlier this year I was with the Minister for Resources and Energy—who I am pleased to see in the chamber today—at the Australian National University for a launch of a major project to increase the efficiency of photovoltaic solar cells. The project secured investment from Trina, a Chinese company that is a world leader in global energy.

Late last year, my friend Andrew Barr, a member of the ACT Legislative Assembly, and I opened the Sustainability Hub at the Canberra Institute of Technology. That facility allows Canberrans to get practical experience in the latest green building applications, materials and new products for residential and commercial sectors as well as in renewable technologies, like wind and solar. Canberra is already pioneering an electric car grid, with battery charge stations provided by Better Place—and I acknowledge the work my friends Evan Thornley and Macgregor Duncan do at that company.

The world is also harnessing these advantages and we cannot afford to be left behind. Reviews have been conducted for governments of both persuasions and they have been crystal clear on this fact. Those opposite often deride what is going on in China. China's wind energy industry is projected to top 150 gigawatts by 2020, and that is up from earlier projections of 30 gigawatts. China is introducing emissions trading schemes in some of its largest cities—including Beijing and Shanghai—and is reported to be planning a nationwide trading scheme to commence in 2015. That is right: a nominally communist economy is more committed to the market than the Liberal Party of Australia.

In Canada, four provinces—British Columbia, Manitoba, Ontario, and Quebec—are partners in the Western Climate initiative which aims to introduce emissions trading in phases. British Columbia's carbon price is already at $25. In the United States, a coalition of eastern states—with a combined population twice that of Australia's—participate in an emissions trading scheme covering the power sector. California will start a carbon trading scheme in 2012 and is working with the four Canadian provinces to progressively establish a regional trading market from 2012 onward. International linkage makes economic sense. Climate change is a global problem and we want to get the lowest cost abatement. Japan and South Korea are piloting voluntary emissions trading schemes. South Korea introduced economy-wide mandatory emissions trading legislation into its parliament in April 2011 to commence in 2015 and it is seeking to pass the legislation this year. All European countries and Australia's top six trading partners—China, Japan, the United States, Republic of Korea, the United Kingdom and India—have implemented or are piloting emissions trading schemes, carbon taxes or coal taxes at the national, state or city level. The fact is the world is acting and Australia has a role to play in that action.

In December 2009, Christina Ora, a young person from the Solomon Islands, stood up in front of the world and spoke these words:

I am 17 years old. For my entire life, countries have been negotiating a climate agreement. My future is in front of me. In the year that I was born, amid an atmosphere of hope, the world formed the United Nations Framework Convention on Climate Change to solve the climate crisis.

I am confident we can answer Ms Ora's challenge, that a global solution can be found, that collectively we can stabilise our emissions while allowing economies to grow and, importantly, allowing development that will see millions of people brought out of poverty.

The Australian government has been debating acting on carbon pollution since Graham Richardson brought a submission to Bob Hawke's cabinet in 1989 to reduce Australia's greenhouse gas emissions. We have had 35 parliamentary reviews into climate change. I am a proud supporter of this economic reform. This is economic reform that sets our nation up for the challenges of the future. It is the stuff of which Labor governments are made. Labor governments brought down the tariff walls in Australia, Labor governments floated the dollar, Labor governments put in place Medicare and Labor governments implemented universal superannuation. For each of these reforms it has taken a Labor government to harness the prosperity of the future. None of these reforms were uncontroversial at the time of their enactment but all of them have paid dividends and increased our nation's prosperity. I am confident this reform will stand the test of time and secure our clean energy future in the low-pollution world of tomorrow.

Ian Macfarlane (Groom, Liberal Party, Shadow Minister for Energy and Resources) Share this | Link to this | Hansard source

I rise today to speak on the Clean Energy Bill 2011 and related legislation, the Gillard government's latest euphemism for its economy-destroying carbon tax. There is no more significant an issue confronting this parliament at the moment, but not for the reasons the government attempts to fob off on an electorate that is increasingly incredulous that its government is going out of its way to put economic restraints and growth shackles in place that will cost Australians jobs.

This is a tax which will destroy Australia's competitive advantage. It will place layer upon layer of costs and red tape on some of our most important and productive industries, from those in the resources sector to those in the manufacturing sector, which are already doing it tough. This tax will drive up the cost of electricity to every home and business in Australia. Every home and business in Australia will pay more because of this tax. It is a tax that will create uncertainty for electricity generators because it will cause substantial devaluation of their assets. It is a tax based on a lie.

I listened carefully to the previous speaker as he waxed lyrical about what people want from a carbon tax. He just forgot to mention that this government did not have the guts to actually say to the electorate in the lead-up to the last election, 'Oh yes, by the way, we will introduce a carbon tax because that is what you want.' In fact, they went out of their way to deny that they would introduce a carbon tax. Particularly the Prime Minister and the Treasurer explicitly ruled out a carbon tax, to the point where the Prime Minister of Australia said, in her own words, 'There will be no carbon tax under the government I lead.' Fast forward to a year later and here we are debating the most job-destroying piece of legislation I have seen in my 13 years in politics and in probably my 56 years of life.

I have never seen a government so desperate to stay in power, so desperate to hang on to the blue carpet and the letter that they are prepared to destroy Australia just to sit on that side of the chamber because that is what the Greens in the other chamber tell them to do. This is a disgrace which every Australian will pay for in jobs, income and standard of living. Are we so blind in Australia that we cannot see that for everywhere else in the world being competitive, being able to export your goods at a competitive price and being able to maintain your standard of living are the key issues? Virtually every other nation in the world would love to be in Australia's position and this government is doing everything it can to put Australia in their position, to drag us backwards, to cost us jobs, to introduce a scheme that is going to have a devastating effect on Australia's future.

This policy has been built from the rubble of one of the most fundamental breaches of trust with the Australian people after the Prime Minister went back on her key words, 'There will be no carbon tax under the government I lead.' How can she stand at the dispatch box and say this is good for Australia? If she were so sure of that, why did she not have the guts to say it before the people voted so that people at least had a chance to give her their view?

Australians will pay with higher electricity bills because the Labor government either does not care about the living cost pressures or is in so deep with its Green alliance that it has no option but to ignore the cost of living pressures that this tax will put on Australians. I do not buy that each and every member on the other side of this House can rest easily with this approach. I know the Labor Party, I know how tribal they are, but most of all what I know about this government is that they are desperate to stay on that side of the House and not face the people. So I say there are members on that side who need to muster up their courage when this comes to a vote and vote as their constituents want them to vote—against this tax.

I know what my constituents want. I meet with my constituents regularly, in formal meetings or with a quick chat on the street when I am off to get a cup of coffee, and I read their hundreds, if not thousands, of emails. I cannot believe that those on the other side can so brazenly turn their backs on their constituents, without even the smallest of whimpers or a twinge of unease. I cannot accept that members from regional areas in the Labor Party in particular are prepared to sell out their constituents so greatly, when we all know that it is regional Australia that will bear the brunt of this tax.

Since the $23 a tonne carbon tax was announced and the details finally put on the table, after months of policy vacuum, there has been substantial debate about how the carbon tax will affect households and families. But an equally pressing issue is how it will impact on Australia's energy supply and energy security. The answer does not inspire any confidence at all. No matter what the Prime Minister or the Minister for Climate Change and Energy Efficiency say to coal companies, the objective of the Gillard government's carbon tax and carbon abatement policy is to reduce Australia's reliance on coal and cut jobs in Australia's coal industry.

This has implications in particular for Queensland workers and Queensland coal communities, which will suffer a significant downturn if the steaming coal industry is scaled back. Of course, that will have a knock-on effect to the cost and reliability of the electricity supply in Australia because, quite simply, electricity will become more expensive. The coalition believes there is a better way to reduce Australia's greenhouse gas emissions, without crippling Australia's economy, costing us jobs and lowering our standard of living. One of the key components of the Gillard government's carbon tax is the $5.5 billion compensation package for electricity generators. Yet nearly all that money will go to Victoria and South Australia, and the generators in New South Wales, Queensland and Western Australia will get no compensation at all.

The O'Farrell government in New South Wales have stated that the cost to that state alone will be in the vicinity of $5 billion, and the reality is that that loss in Queensland—although the Queensland Labor Premier, Anna Bligh, has not come out with a complete figure—would have to be close to that same figure, $5 billion. Even the figure she has given, $1.7 billion, is still a substantial amount of money. No matter how the Queensland government tries to downplay it, there is clear evidence from two reports released last month that Queensland will be hit hardest by this carbon tax.

It has been interesting to watch Premier Anna Bligh try to take two bob each way. She is a good enough politician to know what this is going to do to Queensland. She knows, as she travels around Queensland, what people are saying, but she is trying to support a Prime Minister who is in desperate trouble and desperately trying to appease her alliance partners, the Greens. Anna Bligh knows that in an economy so dependent on energy and resource industries, like Queensland, the Treasury modelling says that the state's gross product will be 3.5 per cent lower because of this tax by 2049-50. Another report, from Deloitte, shows that, based on a carbon tax of $33 a tonne, economic growth will fall by 4.11 per cent by 2050. That is the impact on the economic growth, but of course the central feature of the carbon tax is that it will increase cost of living pressures and the cost of operating expenses for homes and business by forcing up the price of energy used in those homes and businesses.

The chief objective of a carbon price is to make activities that generate a lot of greenhouse gas emissions more expensive. The theory is that that will encourage a switch to alternative activities that generate fewer greenhouse gas emissions. But that switch is already happening. Households and businesses in Australia are doing everything they can to lower their energy footprint. Also, this tax is not big enough to actually cause a change in fuel use by electricity generators. As the Minister for Resources and Energy, who is sitting opposite me, knows, the price is something like $60 a tonne. Is that really the agenda of this government—to get in a small tax and then treble it? We have much to worry about as we look at what is going to happen under this government's proposed tax.

The fact remains that, whatever happens, there is going to be a change in Australia's electricity base, and in Australia's coal fired electricity base the change will be the greatest. By the government's own modelling, by 2050 coal fired electricity will contribute just 10 per cent of Australia's energy mix—down from 80 per cent. We know what that means. We know it means less coal being mined and it means fewer jobs. But, most of all, it means higher cost electricity. This is all pain and no gain. When the Greens, the Labor Party's alliance partners, demonise large industry and call them 'big polluters', they are actually talking about industries that quite literally power our economy, put electricity in our homes and employ tens of thousands of people.

I hear those opposite wax lyrical about clean, green jobs. Well, show me where they are, prove to me the sustainability of those jobs, and show me an example of an economy that has done that. How about we look at Spain—four to six jobs lost for every green energy job created. Is that what this bill is going to do to us? Is that the damage this carbon tax is going to wreak on Australia? I think so. This mirage, this petticoat, of green jobs that they keep trying to the hide behind, is not real. The jobs of building solar panels and wind turbines are going to go to those countries already dominating in that field, and, as we all know, Australia is not one of them—in fact, China is. While I mention China, we need to be mindful, of course, that China's emissions are going to rise by 496 per cent on their 1990 levels by 2020. The world changed at Copenhagen. To use the words of the previous Prime Minister, there was a fork in the road. The rest of the world went the way of common sense, maintaining their economies, keeping the cost of living down and keeping their industries competitive and Australia has gone this way—and this way ends up in oblivion. That fork in the road is what changed my view on whether or not we should have a carbon trading scheme now. I certainly never supported a carbon tax, but if we want to look at where we are now and where we are heading, while the rest of the world fights to keep their economies afloat we are blindly sailing off to the left by ourselves. There is no-one else in sight—no other country with a carbon trading scheme anything like the magnitude of this, no other country putting at risk its industries, no other country inflicting costs on households. Here we are, led by the Gillard-Brown government, sailing into oblivion as Australian industry is destroyed by this tax.

The coalition does have an alternative. As well as that alternative, there are numerous ways—smart ways—by which we could lower emissions, if we were really serious about lowering emissions by 150 million tonnes a year. Just get out of the way of the LNG industry and do everything we can to promote it so that it lifts its exports to 60 million tonnes. The offset in coal being burnt in Japan, China and Korea would more than amount to a global saving of 150 million tonnes. Let's employ new technology like what I saw yesterday, where municipal waste is no longer dumped in landfill but used to generate electricity and thus save the emissions of methane gas.

This has long been a spend-and-tax government. This tax is going to add to the tax list that they have compiled but in the process, unfortunately, will destroy Australia's future.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

I note the previous speaker has had a road to Damascus conversion on this issue, because he previously was the chief negotiator for the member for Wentworth when he was the Leader of the Opposition. He said on Lateline on 30 April 2007, displaying his climate change scepticism:

… what I am sceptical about is some of the more exaggerated claims that are being made about the connection between CO2 emissions and climate change.

So he is another sceptic. He has gone from being a supporter of taking action on climate change under the opposition of the member for Wentworth to being someone who is an Abbott devotee and a paid-up member of those people who listen to the ravings of British hereditary peers who present the case that we are engaging in some sort of communist conspiracy. It is a nonsensical attitude that they are undertaking.

The absurd, misleading and deceptive aspects of the coalition's scaremongering on this issue are appalling. It is deceitful, unprincipled and reckless. Once again the Leader of the Opposition demonstrates he is unfit to lead this country, and we saw that on display again today. He was a senior minister, and so was the member for Groom, in the Howard government. They went to the election in 2007 advocating a carbon pollution reduction scheme. We saw, for example, that the Leader of the Opposition had position after position after position on this issue. He is a complete weathervane. He came in today and talked with such unctuous and righteous indignation about this when he supported this type of arrangement under John Howard when he was the Prime Minister and under Malcolm Turnbull when he was the Leader of the Opposition. He was on the public record on numerous occasions supporting an emissions trading scheme in this country. And now, today, having had this road to Damascus conversion himself, he tries to claim that he now never believed in this sort of thing. This is what the opposition are about: constantly campaigning on fear, never on the facts.

In relation to political issues, I did not principally come into politics to advance green issues. In my maiden speech nearly four years ago you will barely find a word in relation to climate change or environmental issues. I got into public life to advance the cause of the Labor Party and the labour movement by ending Work Choices and replacing it with a new, fair, simple and balanced industrial relation system; to build better schools and universities; to improve health and hospital systems in my area and my state; and to fix the Ipswich Motorway locally and create a more sustainable, job-friendly, healthy and environmentally-effective community in Ipswich, a fast-growing area in South-East Queensland. I did not stand for preselection to build some green utopian Jerusalem but to achieve practical and pragmatic outcomes to help families and individuals in Ipswich. My sympathies have always been with the jobs of law-abiding timber workers and their families rather than lawless people who chain themselves illegally to trees.

But my decision to support the Clean Energy Bill 2011 and its associated bills comes not from some green, pantheistic passion but from two sources: firstly, my faith; and, secondly, the facts. First, I believe we are placed by providence on this planet and have a responsibility to care for it. We are stewards or custodians of it. We need to give the planet the benefit of the doubt. Second, I prefer not to respond to the rantings and ravings of shock jocks. I accept the findings based on evidence of the CSIRO, the Bureau of Meteorology and the Academy of Science. I accept the recommendations of reports and reviews by Stern, the IPCC, Garnaut and the Productivity Commission. They tell us that climate change is real, that it is caused by greenhouse gas emissions, that human activity contributes to climate change and that, if we do not act, there are serious adverse environmental, economic and social consequences to our country and our communities. The most environmentally effective and economically efficient way to deal with dangerous climate change is by pricing carbon and by an emissions trading scheme, and that is what we are proposing to do today.

The clean energy legislation before us does indeed introduce a carbon pricing mechanism. It is a market based scheme we are going to. In the Labor Party we believe in the market and the national interest, and we believe in the market in the national interest on climate change. But take a look: we have 18 related bills, far more than just a carbon tax. The real issues we are debating are real action on climate change, protection of Australian jobs and assistance with cost of living. The clean energy legislation is part of one of the most significant reforms this country will ever face, and one of the biggest challenges we will ever face is climate change. I challenge those opposite to avoid the trap of mindless nay-saying. It is time to investigate this legislation, it is time to pass this legislation, it is time to act on climate change.

Since 1994 we have had 35 parliamentary inquiries, numerous reports and reviews into climate change. I charge that those opposite will not be distracted from the duty they have to act in the national interest. Before us is a raft of legislation designed to transform this nation's future into a sustainable one, to transform the way we live, to sustain the environment, jobs and households. The experts say that since the 1940s every decade has been warmer than the one before and that the 2000s were the warmest decade on record. Australia happens to be one of the world's largest emitters of carbon pollution per capita, equating to about 27 tonnes of carbon dioxide per person.

About 30 countries in Europe are already participating in an emissions trading scheme. Ten states in the United States already participate, with California joining next year. Even across the Tasman, New Zealand has an emissions trading scheme. We have heard businesses questioning these reforms locally. Three-quarters of New Zealand's businesses were sceptical, according to surveys in 2008, but three years later about two-thirds of them now support the scheme. And China is transitioning to emissions trading schemes in many provinces with hundreds of millions of inhabitants. China invests more in renewable energy than any other country and has some of the most ambitious emissions targets in the world.

This legislation of associated bills will deliver a reduction of 160 million tonnes of carbon pollution by 2020, the equivalent of taking 45 million cars off the road. But we are going to protect jobs, as we did during the global financial crisis, because that is in our DNA. Unlike what the member for Warringah, the Leader of the Opposition said in relation to this issue, we supported jobs during the global financial crisis and we are going to create jobs in the future. Treasury tells us there will be 1.6 million jobs by 2020 and 500,000 jobs by the middle of 2013. Those opposite tell us this legislation is bad for the economy, but I say it is time to act. It is not bad, it is important for the economy. They say it is not time to do this, but they have always said it is not time to do this because they are always nay-sayers. Whether it was universal superannuation, the pension or Medicare many years ago, they have fought reform tooth and nail. They always have, they have always been on the side of reaction. They are not liberals, they are reactionaries.

We have created under our watch 750,000 jobs since being elected in 2007. We are going to support jobs in high-polluting industries with competitors in countries where those industries do not yet have comparable carbon constraints. Over the next three years we will devote $9.2 billion of the carbon-pricing revenue to assist those industries and to help jobs in those industries most affected. This includes $300 million to help transform the steel industry, $1.2 billion to support the coal industry, $1.2 billion to clean energy technology and manufacturing. The jobs and competitive program we are undertaking will support activities in those areas that generate about 80 per cent of emissions in the manufacturing sector.

They say all politics is local, and I want to talk about one of the major employers in my area, JBS Australia. They are the largest meat-processing company in Australia. They will certainly be among the top 500 polluters, mainly because of the power they use. The largest meat-processing plant is in Dinmore, in my electorate of Blair. I can assure you that JBS Australia is already acting to reduce its impact on the environment. In Dinmore they have invested millions to develop ways to recycle water, to minimise waste and odours, to minimise the amount of power they use. The water they release back into the Bremer River is much cleaner than the water already in the river. The Dinmore plant is an example of best practice in meat processing in Australia, if not the world. This is a company that will take advantage of the food and foundries investment program, worth up to $150 million in the food processing industry. They will be able to apply for grants to support them and other businesses as they invest in research and development.

The carbon-pricing mechanism will not apply to 9,971 small businesses currently operating in Blair, in Ipswich and the Somerset region. These small businesses will not have to monitor carbon pollution or electricity use. They will not have to fill in one additional form as part of their reform package. This government recognises the contribution of small business, with over two million businesses employing about five million Australians. The government is legislating to make changes to benefit business with tax reforms designed to improve cash flow while allowing small businesses to depreciate assets more quickly, while reducing compliance costs, and by simplifying depreciation rules.

I ask again: when is a good time to introduce this legislation? When is a good time to act on climate change? It will cost us more if we do not act. I can assure you, Deputy Speaker, we have a responsibility to the Australian people to act, because a coalition government could not and would not act and procrastinated for 11½ years under John Howard. What we know is that the coalition continue to flip and flop on this issue, salivating slogans as the Leader of the Opposition goes around the country, whipping up fear, when in reality their plan would cost people in my electorate and across the rest of the country about $1,300 a year. That is right: families and communities would pay, not big polluters. The difference between us and them is that big companies—the big polluters—pay and the community is supported and assisted under our scheme. Under the coalition's scheme the community pays and the big polluters and their supporters get subsidies and assistance. It is once again a demonstration that the coalition is not on the side of the market or small business or families and individuals. They will not create jobs. Their plan will not work. As the member for Wentworth said: it is the plan you have when you do not want to have a plan. This accords with what they did in the last election and since then: their failure to respond to the Queensland floods and come up with the savings they needed, their failure in relation to their costings before the last election—the $11 billion black hole—and the $70 billion budget black hole that they have also talked about. The depth of the gap between their promises and Australia's fiscal reality—not to say action on climate change—is stark. The coalition would tax every man, woman and child in this country in relation to climate change. And they have not ruled out cuts to pensions and the cuts that we will make to taxes.

We will give assistance in my electorate. Of the 53,000 taxpayers in my electorate—taking in most of Ipswich and all of the Somerset region—about 47,000 taxpayers will receive a tax cut, and 40,000 of them will receive a tax cut of a least $300 a year. Those tax cuts, and the assistance we provide, will be permanent in the future. In my electorate 42,800 people will receive some form of household assistance through pensions and family assistance payments. About 14,100 of my local families will receive household assistance through family assistance. This assistance provided is greater than the anticipated cost increases caused by the Carbon Pollution Reduction Scheme and the carbon-pricing mechanism.

I have 23,000 pensioners in my electorate and I am pleased to say that every single pensioner will be $338 better off while couples will receive $510, and they will be better off. The pension increases will come in next year. They will be better off because we will put a buffer in to assist those on low incomes and fixed incomes. We are Labor, and we support those in need. We support them and we want to make sure that they are not left behind.

It took the Leader of the Opposition 25 full minutes in his speech to finally talk about the coalition's policy in relation to this. As the member for Wentworth has said, it is not possible to criticise the opposition's policy on climate change because one does not really exist. When it comes to climate change there is only one party that will act right now. Across the country, we need to take steps in relation to climate change. We are the party that will undertake this reform. We are the right people, on the right side of the Speaker's chair, to take action. It is the right package at the right time. It is a bold step. It is acting in the national interest. Other countries—South Korea, China and the USA—are acting as well. This legislation is important for the future of this country and it is in the national interest. (Time expired)

Ms Julie Bishop (Curtin, Liberal Party, Deputy Leader of the Opposition) Share this | Link to this | Hansard source

The opposition will be opposing the Clean Energy Bill 2011 and associated bills. We oppose a carbon tax. We do so not simply because it represents one of the most breathtaking cases of monumental deceit in modern Australian political history. Australians well remember that the Prime Minister promised during the last election campaign:

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

We do not simply oppose it because the Prime Minister has trashed her solemn promise to the Australian people. It is not just because the Prime Minister has broken faith with the public. We oppose this carbon tax because it is bad policy.

The government's carbon tax is more about socialism than environmentalism. It is actually a massive redistribution of wealth, motivated by the need to raise revenue rather than to reduce emissions. Indeed, the tax itself will not even reduce Australian emissions. The extent to which that may occur at some point in the future would be due to other action taken, not because of the imposition of a tax.

We also oppose this policy because now is one of the worst times to introduce such a damaging economic instrument. This is not economic reform, as the government maintains; this is economic vandalism. Has the government even bothered to scan the world economic environment before proceeding with this reckless scheme? Has the government honestly and objectively assessed the Australian economic environment before proceeding?

Since 2008, Treasurer Wayne Swan has brought down successive budget deficits so large that he has been too embarrassed on occasions to publicly acknowledge them. Over his four budgets, the cumulative deficits total $150 billion. The government has borrowed to fund the deficits, and net government debt is now around $120 billion. Our debt ceiling has been lifted by this government from $75 billion to $250 billion. The current budget deficit is $49 billion, yet the Treasurer continues with the pretence of announcing a 'return to surplus' several years in advance.

This lack of fiscal discipline has made Australia more vulnerable to the impact of a second potential world downturn, and no longer as well prepared to resist external shocks as we were in 2007 and 2008. Australia should be wary of relying heavily on other nations to provide protection from global economic events without first ensuring that our own house is in order. This means cutting wasteful spending and reducing expenditure rather than embarking upon tax grabs from productive sectors of the economy.

The threatened increase in the cost of living from a carbon tax is sapping business and consumer confidence. The combined threat of the carbon tax and mining tax is raising serious concerns internationally about Australia as an investment destination. With an uncertain global economic environment likely to remain for some time, the government should abandon its carbon tax and do everything in its power to build greater confidence among consumers and businesses within Australia and those looking to invest here.

Let me turn to some other aspects of the government's carbon tax policy. A key element of the policy is designed to ensure that Australia reaches the target of a five per cent reduction in greenhouse gas emissions by 2020, not by cutting that volume in emissions from Australia but by purchasing carbon credit offsets from other countries. When asked about the purchase of offshore permits the Prime Minister said:

Yes, this is going to be an internationally linked scheme and so it should be.

It is alarming that the Prime Minister has given no indication that she is even aware, or has any understanding, of the recent history of the operations of international carbon credit markets. The World Bank reported recently that the international market in carbon credits has suffered a debilitating collapse, and expressed doubt about the ongoing viability of global markets. According to the World Bank, trading in credits commenced after the Kyoto protocol was adopted in 2005 and about $25 billion was generated over the years to 2009. However, that market collapsed to $1.5 billion last year due to ongoing concerns about the commitment of nations after the expiry of the Kyoto protocol in 2012. The United States withdrew from the Kyoto protocol in March 2001 and has indicated it will not commit to any replacement treaty. Russia, Japan and Canada have all stated recently that they will not continue with the protocol after it expires.

Last December the European law enforcement agency, Europol, issued a statement about extensive defrauding of the European Union emissions trading system. Europol reported that it had raided several hundred offices throughout Europe and had arrested more than 100 people. In one operation in Italy, the police conducted raids on 150 companies in eight regions as part of an investigation into huge volumes of suspected fraudulent transactions on the Italian Power Exchange. Europol reported that raids also occurred in Norway, Switzerland, Belgium, the Czech Republic, Denmark, Latvia, the Netherlands, the Slovak Republic and Portugal. After all these actions, trading volumes in Europe dropped by 90 per cent. It has also been reported that 90 per cent of trades in the European Union emissions trading system were fraudulent, resulting in a loss to European taxpayers of more than $6.6 billion. The Wall Street Journal concluded that the European Union emissions trading system was not actually a functional scheme at all but was a 'political smokescreen' to enable European politicians to claim green credentials while avoiding difficult decisions on reducing emissions.

A former correspondent for the Australian Associated Press based in Port Moresby wrote recently of the 'cowboys' who flocked to PNG in pursuit of carbon credit riches. He detailed the first arrival in 2009 of 'carbon cowboys' offering villagers 'sky money' for the right to use their land in international carbon trading schemes. This led to alleged corruption of local officials who also stood to gain from these get-rich-quick schemes.

The Prime Minister of Australia is proposing in her carbon tax policy that an estimated $57 billion of Australian taxpayer funds will be sent offshore to buy carbon offsets to enable Australia to reach Labor's new target of an 80 per cent reduction in emissions by 2050. The logic of her proposal is that Australians should pay people overseas tens of billions of dollars for the right to burn our own coal so as to meet her commitment that the coal industry has a 'bright future'. This is apparently to be achieved through a nonexistent international trading system. It is naive at best for the Prime Minister to assume that such a scheme will emerge given the clear signals internationally that major emitting nations are moving away from trading in carbon credits, and the minister in the House at the table knows this.

Of more concern is that the Prime Minister appears blithely or wilfully unconcerned about the fraud and criminal activity that has beset trading in carbon credits in developed countries of the European Union, let alone what is taking place in developing countries. Deloitte Australia has warned that carbon credit fraud is 'the white-collar crime of the future'. The Prime Minister must explain clearly, before there is a vote on this legislation, why it is that her carbon tax on what she terms 'the big polluters in Australia' will not meet the emissions reduction target by 2020 and why billions of dollars in taxpayer funds need to be sent offshore in order to do so. How on earth can this Prime Minister ensure that the tens of billions of Australian taxpayer dollars committed to purchasing international carbon credits will not end up in the clutches of carbon cowboys? So we oppose this bad policy because it is full of flaws. We also oppose it because it will cripple the mining sector, which contributes so much to Australia's prosperity.

The government accuses the opposition of a scare campaign, but it is the government's shameless scare campaign that should be condemned. The Prime Minister has spent months attacking the 1,000 big polluters—or is it 500 big polluters? Then it was 400 big polluters, and yesterday it was back to 500 big polluters. Tomorrow it could be 1,000 big polluters. She has demonised these Australian companies by claiming that they are causing 'more bushfires and drought', 'agricultural land in the Murray-Darling Basin no longer being able to be used for agriculture' and 'icons like the Great Barrier Reef being threatened'. These examples of her scare campaign run into reams of paper.

But the reality is that the government's policies will massively damage the coal sector. In order to meet Labor's latest target of 80 per cent reductions in emissions by 2050, the coal industry cannot continue to operate in this country. Yet the Prime Minister seeks to con coal workers into believing the government wants to support the coal industry's 'bright future'. Given that the vast bulk of our electricity is generated by coal-fired power stations and that coal is by far the largest contributor to Australia's greenhouse gas emissions, the Prime Minister is either unaware of the contradiction in her two positions or being deliberately dishonest. The Prime Minister cannot have it both ways. Either coalmining has a future in this country under her Clean Energy Future or it does not. Her power-sharing partners in government, the Greens, have no such difficulty. Greens leader Senator Bob Brown was asked during an interview on 26 June this year whether the carbon tax will close down mines overnight, and Senator Brown, the co-prime minister of this country, said:

But that has to be the outcome. You know the coal industry has to be replaced by renewables.

Further, the Prime Minister conveniently ignores the fact that the challenge of reducing emissions is a global problem. The atmosphere does not differentiate between emissions released in Australia and those in other parts of the world. Australia is responsible for just over one per cent of global greenhouse gas emissions, and as a developed country we should play a responsible role in the global context. However, Australia could reduce emissions to zero yet produce no discernible environmental gain if the major emitters such as China and India continue to increase emissions. Adopting the Prime Minister's flawed logic, companies mining coal which is burned to produce electricity in Australia are big polluters here and must be punished to prevent damage to the environment, yet simultaneously companies mining coal to be burned in power stations overseas and for steel production overseas have a bright future in this country. What the Prime Minister is deliberately trying to conceal from the Australian people is that her carbon tax is designed to make electricity generated from coal increasingly expensive to the point where it virtually guarantees the shutting down of the coal-fired electricity sector in this country. There can be no other way to meet the target of an 80 per cent emissions reduction by 2050.

According to the Productivity Commission, Australia is the only country on earth seeking to introduce an economy-wide carbon tax or emissions trading scheme. Despite the glowing references to the European scheme by government ministers, it should be noted that European steel companies recently wrote to the European parliament warning of the competitive disadvantage that would come from unilateral action on carbon pricing and that it could 'increase global emissions as market share is off-shored to non-EU countries with inferior emissions standards'. If other nations such as China, India and, indeed, the United States do not impose an economy-wide carbon tax, Australia is handing manufacturers offshore an enormous competitive advantage over Australian manufacturers.

The Prime Minister is wishing and hoping that her leadership will encourage other nations to follow suit. The arrogance behind this policy on a wing and a prayer ignores the lessons that should have been learnt from the Copenhagen climate change conference. Most countries in the world are focused on their own economic development and improving the standard of living for their citizens. Australia's so-called leadership seems hell-bent on destroying the standard of living our country enjoys. The government has been unable to implement the simplest of concepts—pink batts in people's houses, building school halls—without disastrous consequences.

We have no faith that this government can competently implement good policy. Imagine what it will do with bad policy and with legislation that runs to 2,065 pages. History will judge this Prime Minister and, even if it is only a footnote rather than a chapter in Australia's political history, it will begin with her broken promise to the Australian people that there would be no carbon tax under a government that she led.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

I rise to voice my strong support for the Clean Energy Bill 2011 and 18 related bills before the House. It is an honour to do so with you in the chair, Deputy Speaker Livermore, because I know you feel passionately about this as well. I note that this is the third time I have risen in the House to speak in support of a system that will set Australia on a course to a clean energy future.

Mr Randall interjecting—

The opposition have wrecked our previous two attempts to put a price on carbon emissions, although I should commend the member for Wentworth, the Hon. Malcolm Turnbull, for his courage to cross the floor on those occasions and also the two very brave Liberal senators, Sue Boyce and Judith Troeth, who had the courage to also cross the floor in the Senate. I saw them do so on the day that the Greens voted with the National Party against that legislation. Who knows what would have happened if a few more people had had the courage to support the CPRS then, but that is history. We cannot change our yesterdays, but we can influence our tomorrows.

Mr Randall interjecting—

Tanya Plibersek (Sydney, Australian Labor Party, Minister for Human Services) Share this | Link to this | Hansard source

I rise on a point of order, Madam Deputy Speaker. If the shadow parliamentary secretary for roads and transport is going to continue to interject, you might wish to ask him to listen in silence.

Don Randall (Canning, Liberal Party, Shadow Parliamentary Secretary for Local Government) Share this | Link to this | Hansard source

Is that a point of order?

Tanya Plibersek (Sydney, Australian Labor Party, Minister for Human Services) Share this | Link to this | Hansard source

Yes, it is a point of order.

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

I take the Minister for Human Services' point. I ask everyone in the chamber to listen to the member for Moreton in silence.

Mr Randall interjecting—

The member for Canning will not start up again. Listen in silence please.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

It is very easy for me to ignore him, but I know it is harder for others. The member for Warringah has won some positive headlines lately as a result of his opportunism and opposition, but this debate is not about the polls or tomorrow's headlines; it is about our future. One hundred years from now our descendants will face the consequences of our decisions in this place. I hope they can be proud that as a parliament we put egos, political divisions and ambitions aside to come together as one on this issue of climate change.

As the largest polluter per person in the world and the 16th overall, Australia must not shirk from our international responsibility to reduce our emissions. We cannot continue to ignore the science that tells us that excess carbon pollution is causing the climate to change in dramatic and previously unseen ways. Extreme weather events, higher temperatures and deaths associated with those, more droughts and rising sea levels are just some of the things that are happening. In Australia, the driest continent, our environment and climate are particularly vulnerable to climate change.

While so much of the political debate focuses on our differences, we should also acknowledge what the major political parties have in common. We have much in common. Both major parties agree that climate change is real and that human activity through carbon emissions is contributing to it. Former Prime Minister Howard took this notion to the ballot box in 2007, and so did I. The Hon. Tony Abbott took this to the ballot box in 2010, and so did I. The major parties agree that now is the time for Australia to act, and the major parties agree that with sluggish global action we need to start with a modest reduction target of five per cent. That is what the major parties agree on.

I note that in his speech the Leader of the Opposition was trashing his own five per cent target and in the same breath misleading us about China's growth. The 500 per cent figure for the projected growth in China that Mr Abbott used is completely misleading. The 500 per cent growth figure is for the years 1990 to 2020. Now, I have not been to China for a while, but a little bit has happened in China since 1990. There has been quite a lot of development since 1990, so we are actually talking about the next eight years. It is quite misleading for Mr Abbott to suggest that there will be a 500 per cent increase—totally misleading.

Bob Baldwin (Paterson, Liberal Party, Shadow Minister for Tourism) Share this | Link to this | Hansard source

Madam Deputy Speaker, on a point of order: I would ask you to remind the member that he is to address members by their correct titles.

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

Thank you. The member for Moreton will address ministers by their correct titles.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

The member for Warringah. Of course, where we differ is on the best way to achieve this target. It is ironic that the once great defender of the free market, the Liberal Party, is advocating a centralist state solution through its direction action plan—although, to be honest, I have not heard the Leader of the Opposition or anyone opposite talk about this plan much lately. There is actually a deafening silence on either side of that shrill 'No!' In his 30-minute speech on these bills, the opposition leader devoted just 15 seconds to his direct action alternative—and I notice the member for Groom, who followed, was actually a little bit duplicitous there as well. The member for Groom said that this mirage of green jobs is not real, but his own direct action policy document says:

The Coalition recognises the potential for clean energy to underpin future employment growth in key regional areas.

The member for Groom, based in Toowoomba, needs to read his own document.

The Labor government is introducing a market based carbon pricing mechanism. Hearing the Deputy Leader of the Opposition, I was surprised to hear that the member for Curtin no longer supports a price on carbon. Just a few years ago, the member for Curtin said:

The Liberal Party has a policy of both protecting the planet and protecting Australia. We support, in principle, an Emissions Trading Scheme (ETS) as part of a three pillar approach to climate change which also includes clean energy and ongoing international pressure for reduced world emissions.

The opposition also claim that the government does not have a mandate to introduce this legislation. That is complete rubbish. They need to go back to the maths books and work out what a majority is. As far as I can work it out, a majority is 50 per cent plus one. They can either rewrite the laws of mathematics or rewrite the Constitution, but to suggest that we do not have a mandate is completely erroneous and specious. They seem to think that just because the Leader of the Opposition could not cajole or bully the Independents or sell anything to them to entice them into supporting him that somehow that is a reason that we do not have a mandate. This is the Leader of the Opposition who was elected, I recall, by one vote: 42 to 41. That was in a ballot where there was spoiled ballot paper—and how you can spoil a ballot paper when there are only three people in it I do not know—and a sick MP who did not turn up for the vote. But the Leader of the Opposition says, 'Oh, no, no.' I would not for one minute suggest that he does not have the right to be the Leader of the Opposition. My understanding of mathematics is very simple: if you get the majority, you have the support of those behind you, even the 41 who did not vote for you.

The Leader of the Opposition wants to bully this parliament into rejecting this bill and waiving our responsibility to secure Australia's clean energy future. As the government, we were elected to govern in the best interests of the Australian people— for today and for our future; for our children and our grandchildren— and that is exactly what we are doing. My electorate knows where I stand on action on climate change and they always have. At the 2007 and 2010 elections, I was upfront with my electorate that a Labor government would price carbon pollution—and I am more than happy to show my election materials to anyone who doubts this. The Gillard Labor government made a clear election commitment to put a price on carbon, and that is exactly what we are delivering. I know full well that my community will hold me accountable to deliver on that commitment. Wherever I go in my electorate—at street stalls, at schools, at aged-care homes, at shopping centres and at other places of business—there is strong support for action on climate change. At a community cabinet in my electorate earlier this month speakers on the floor expressed strong support for a carbon tax.

The Clean Energy Bill introduces a mechanism to price carbon and to set Australia on a course of global leadership in our response to climate change. From 1 July 2012, 500 of the biggest polluters—those that emit more than 25,000 tonnes of CO2, will pay a charge for each tonne of carbon pollution they emit. For the first three years, the charge for each tonne of pollution will be fixed and will start at $23 per tonne. Then, from 1 July 2015, the mechanism will shift to a cap-and-trade emissions trading scheme. Under this system, the market will set the price. I am sure the Liberal Party remembers what a market is. The fixed price in the initial stages will provide stability and certainty for business and enable a smooth transition to our new low carbon economy. Smart businesses will then be able to focus on reducing their greenhouse gas emissions and thus reduce the costs of production. Those businesses that innovate and reduce their emissions will be the ones ahead of the game, both domestically and globally, and the ones able to pass on the savings to their customers. That is how a market works.

Once the market shifts to the flexible price, the government will set a carbon emissions cap to ensure Australia meets its pollution targets. As I said, they are targets that are the same as those set by those opposite. A price ceiling of $20 per tonne higher than the expected international carbon price and a price floor of $15 a tonne will be set in 2015 to ensure that there is no risk to long-term investment in clean technologies. The carbon price will apply to stationary energy, non-legacy waste, industrial processes and fugitive emissions. The price will encourage pollution reductions across all sectors of the economy. It will provide the motivation that industry needs to invest in renewable energies like solar, wind, geothermal and wave and build the momentum needed to get new technologies like clean coal out of the science laboratory and into the real practical solutions to climate change. In turn, these alternative energy industries will be a source of thousands of new low carbon, green jobs.

The bills before the House represent a major reform and a massive shift in the Australian economy; we acknowledge that. But they also include appropriate measures to assist households, to protect Australian jobs, to shield trade-exposed industries and to support innovation. Nine in 10 households will receive assistance through some combination of tax cuts and payment increases. On average, the carbon price will cost households $9.90 per week but, to compensate, they will get about $10.10 in assistance. Government payments, such as family payments, pensions and allowances, will increase by 1.7 per cent, well above the average price impact. Obviously, if you just went out yesterday and bought five new air conditioners, you will be disappointed, but if you are energy frugal, you will actually do very well out of this. Of course, government assistance will increase as necessary in the future.

The Gillard Labor government will devote $9.2 billion of the carbon price revenue to assist high-polluting, trade-exposed industries. These companies will receive free carbon permits to shield their businesses from the impact of a carbon price while maintaining incentives to invest in cleaner technologies. As the world follows Australia's lead—and that is what will happen as per the commitment at Copenhagen; I know it was not humanity's finest hour, but there were some positive things that came out of it—in moving to a clean energy economy, Australian industries will have an advantage on their international competitors. And we do need that advantage because, in terms of competition and productivity combined with our high wages, we need some advantages. It will be good to see Australian green steel being sent around the world. The Gillard government will invest $800 million in a clean technology program to help manufacturers invest in low-pollution technologies and processes. That is a logical investment, rather than just the Work Choices, low-cost-labour target of those opposite. We will also deliver an additional $200 million over five years to support research and development.

This government was elected to act in the national interest. We cannot turn our backs on the science. I am not a scientist, but I must believe the CSIRO. So, when the CSIRO, the Bureau of Meteorology and the Australian Academy of Science stand in agreement with other scientists around the world, we must respond; it would be stupid not to. Now is the time for Australia to act to move to a clean energy future before the task becomes more costly and more difficult. I commend the bills to the House.

Philip Ruddock (Berowra, Liberal Party) Share this | Link to this | Hansard source

In a debate of this type, it is very interesting to focus on the comments of the member who spoke before you because they sometimes bring the issues into clarity. What interested me was the member for Moreton's statement that the world was about to follow our lead. This is about Australia leading the world—that is the comment that was made—and it is, I think, the major difference between the government and the opposition in relation to a price on carbon. I would be encouraged if I believed the world was about to follow our lead, but I see little evidence of that.

I am strongly of the view that Australia should play its part in concert with the rest of the world, but there is no evidence, following the Copenhagen conference, that even the enthusiasm that was evident at Kyoto will continue. There is another conference planned, in Durban, and there is no evidence yet that suggests that the major emitters of the world are going to respond positively, with new initiatives, then. It is important to understand, whether or not you accept the science, that Australia produces a little over one per cent of the world's emissions. Our acting alone, our 'leading the world', will not make one iota of difference to climate change, if the evidence is as the member for Moreton suggests.

The reason I wanted to speak in this debate was to spell out my own views. I am not a climate change sceptic. I am one who is strongly of the view that, if the evidence is that clear and unambiguous, the world would want to respond and in that context Australia should play its part. I am not of the view that Australia should be trying to set some example which it hopes, after disadvantaging itself in world trade terms, others will want to pick up. It is very interesting to look at the way in which this issue is progressing. Even the participants in the global carbon market have told the World Bank that they are pessimistic about the likelihood of any new, globally legally binding treaty being reached on climate change in the near future. I think that really is the test that we have to look at in relation to these matters as we debate this Clean Energy Bill 2011 and the related bills today.

There are commitments that have been made by the opposition, to the Australian people, as to how we can deal with these issues in a modest way, directly, out of the budget, with budget savings, without the imposition of new costs on Australian businesses and industries and without destroying our international competitiveness. This is not a question of Australia being left behind. This is a question of whether we ought to tie one hand behind our back and leave ourselves exposed internationally to the loss of markets for the sorts of products that we are able to produce and allow others to produce goods and services and put them on the Australian market in circumstances where Australian industry cannot compete. So, for me, the major issue with this new tax is that it is the worst possible time for Australia to be destroying its international competitiveness.

Let us look at what is happening around the world right at this time. In the United States, there is the possibility of a second or double-dip recession. They are looking at unemployment rates in excess of nine per cent and growing. They are grappling with in the order of 27 per cent of their population living in poverty. This is a situation in which the United States is unlikely to be able to lead Australia out of the very difficult environment in which the world is operating. In Europe—and it is in the United States and Europe that people are expecting serious activity in terms of limiting potential climate change—what are they worrying about at the moment? They are worrying about whether the banks in places like Portugal, Spain, Italy and Greece are likely to survive and whether the governments of those countries are likely to be able to keep them within the European Union.

This is a diabolical time for Australia to be tying one hand behind its back in terms of its international competitiveness and to believe that we are able to lead the rest of the world. The fact is that under this legislation Australia's manufacturing industry, which is already under pressure, will face a carbon tax which will increase costs and which our overseas competitors will not have to pay. Jobs in Australia will be going offshore as a result. If other countries were imposing similar taxes or implementing an emissions trading scheme which imposed additional costs, it might not be as difficult or as diabolical for us. But the fact of the matter is, and it has been acknowledged, that in the United States all efforts towards a national cap-and-trade scheme have been abandoned. There are suggestions that in one or two states there may be some initiatives.

Europe has an ETS, but it does not cover the whole economy. It provides industries with free emissions permits. I saw reports from Emma Alberici on the ABC about the way in which people are avoiding their obligations under the ETS in Europe. It raises only about $500 million whereas Labor's carbon tax will raise over $9 billion a year from Australians. The government claims that China is acting to reduce its carbon emissions, but we all know that emissions in China are forecast to rise by 500 per cent by the year 2020.

We are pursuing an initiative which will have no appreciable impact upon climate. The CO2 emissions for Australia will continue to increase, according to the government's own statements, from 578 million tonnes to 621 million tonnes between 2012 and 2020. Even Professor Flannery, one of those people whose comments they adopt, observed:

If we cut emissions today, global temperatures are not likely to drop for about a thousand years.

When you are dealing with observations of that sort it is very important to understand that, in the climate in which we are disadvantaging ourselves, we are not going to appreciably change anything when others have not essentially come on board.

The other matter I want to deal with is Labor's claims about the nature of this package. This package will clearly disadvantage Australian industries. It will lead to people losing jobs. Labor claims that families will be compensated for the price impact of the carbon tax. I do not know why you impose a tax if you are going to compensate people for it. There seems to be a little disconnect there. We now know that the compensation will be only 50 per cent of the carbon tax revenue going to families as compensation for the direct cost of living hikes. We know that pensioners, self-funded retirees, small businesses and people who struggle to be able to make ends meet will be facing very significant increases in their costs. This $9 billion carbon tax will see, for instance, electricity prices go up considerably. In Sydney, where I live, we have faced significant hikes already under the former state Labor government. We will see as a result of this measure a 10 per cent increase in electricity bills alone in the first year and a nine per cent increase in gas bills for the same year.

Mr Perrett interjecting—

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

Order! I beg your pardon, I was reminding the member for Moreton that he should be listening in silence.

Philip Ruddock (Berowra, Liberal Party) Share this | Link to this | Hansard source

Was he being rude? Thank you, Madam Deputy Speaker. Higher marginal tax rates for lower and middle income earners will be a consequence as well. In addition, its proposals will have an impact on the budget. These are very significant issues for the Australian community. As I said in my initial remarks, I am not a climate sceptic. I am prepared to see Australia play its part, but I do not believe Australia ought to be leading the rest of the world, as the member for Moreton suggested.

What I want to do today is to put in context some of the comments that the government members have been making about former Prime Minister Howard and the commitments made by the former Howard government. It is important to understand that the Howard government was quite prepared to be part of a world solution, but John Howard in his own comments since Copenhagen has made clear his disappointment that the rest of the world was not ready to come on board at that time. That had an impact on his view as to the way in which the commitments that were made by his government ought to be seen.

I say to honourable members opposite that if they want to know the way in which substantial tax reform ought to be implemented in this country they should follow the lead of John Howard. John Howard was a Prime Minister who was able to put in place very clear and significant tax reform. Its impact on the Australian economy has been commented on favourably. The Howard government went to the Australian people seeking a mandate for the direct tax change—that is, the GST—that it intended to implement. Members opposite have been prepared to say that Howard at an earlier point in time said 'there would be no GST under a government I lead'. He conscientiously went to the Australian people at another election after he made that commitment. I remember well fighting the election campaign on that issue. That is quite opposite to the way in which this government is endeavouring to implement this change—I will not call it a reform.

This change is clearly a change that the Prime Minister said before the last election should not be anticipated. But, even worse than that, the government are trying to force this issue through the parliament without adequate scrutiny. I encourage them to look back and even to reconsider the approach they are taking and use the approach the Howard government agreed on in the consideration of the GST. The Howard government and the coalition agreed to four separate parliamentary committees to inquire into the GST. They had four months in which to report. No debate on the measure occurred in the parliament after the introduction of the measure. All the committees had non-government majorities and were overwhelmingly chaired by Labor. The coalition submitted itself and its policies to total public scrutiny, and there is the difference.

We are debating this measure today that was introduced into the parliament only on Tuesday, yesterday. We are debating it knowing that there is to be one committee that will scrutinise it, with very little time to be able to thoroughly address those issues, and knowing that the matter is being considered under a guillotine. This is not the way in which substantial economic reform in this nation, if it is claimed to be that, should be achieved. The Howard model was far better, more appropriate and far more honourable because John Howard sought to make changes after he had the endorsement of the Australian people at an election. These proposals have never been endorsed by the Australian people at an election.

Simon Crean (Hotham, Australian Labor Party, Minister for Regional Australia, Regional Development and Local Government) Share this | Link to this | Hansard source

The Australian economy is in transition. We are confronted by many challenges, not just climate change. Our high dollar is impacting not just on our manufacturing base but on other big export earners, such as education services and tourism. Natural disasters have also played their part in reducing our capacity and competing for resources. There is also the uncertainty in the global economy. Against all of those challenges and uncertainties Australia is better placed than any other developed economy to absorb those challenges. We are the only developed economy in the world to have avoided the last recession. We have posted incredible job growth—750,000 jobs since we came to office four years ago—growth that recovered quickly from the downturn and from the disasters. We have room in monetary policy. We have a huge pool of domestic savings in this economy that will be set to grow further, courtesy of a compulsory superannuation scheme that was introduced by Labor and that will be continued and expanded under a Labor government.

Those successes that I talk about all came from our preparedness as a nation to confront the challenges we faced in the 1980s and 1990s—the need to open our economy, to seek new markets, to become competitive and productive and to diversify our economic base. It was a Labor government again that led those reforms. The floating of the dollar, the cutting of tariffs, the controlling of inflation and the implementation of national superannuation and Medicare were all bold reforms. Some of them were unpopular at the time and some of them were contested, but all of them were necessary because they laid the foundation for our prosperity and are the reason why today we are the envy of the rest of the developed world. It is against that context that the Clean Energy Bill 2011 and related bills become so important. Climate change is just another challenge. If we handle it properly and boldly we can be set up for even greater sustainability, both environmentally and economically, looking forward.

Our planet is warming. Human behaviour is a significant factor. Climate scientists around the world are telling us that carbon pollution is causing climate change. Ninety-seven per cent of climate scientists, those who specialise in studying our atmosphere, agree that climate change is caused by humanity. We have compelling advice and on that evidence we have to take steps to change human behaviour in a lasting way to lower the carbon footprint and to cut pollution. We also need to do that in a clever way that rewards good behaviour. We owe it to our future generations, but the current generation can benefit as well because a carbon market that rewards good behaviour is a market that will reward creativity and innovation. It will play to our strengths and create new job opportunities.

Treasury has estimated 1.6 million jobs will be created by 2020 under the proposals that we are putting forward. As the Minister for Regional Australia, Regional Development and Local Government the challenge is: what slice of that job growth action can the regions secure? It is a challenge they are rising to. There are new manufacturing jobs, new service jobs and green jobs from green energy solutions. I have spoken much about the patchwork economy and I have visited many of those patches, our regions.

I have held 16 carbon forums around the country in the last two months. Those forums were organised by regional development bodies and were attended by community leaders and stakeholders. All of those forums and all of the RDAs have two common themes built around seizing the opportunity, firstly, to diversify the economic base and, secondly, to embrace a cleaner energy future. Both themes embrace not only economic opportunity and jobs but also liveability—a cleaner, healthy environment for them and their children.

Communities, local government and businesses set their own targets to reduce emissions well before our package was announced. They had determined what needed to be done. They were looking for how they could be helped to achieve their agenda. This package of bills supports that agenda in so many ways. These bills ensure that nine out of 10 households are compensated. The price effect of the carbon price is low. It is less than 1c in the dollar. Remember that the GST added 10c to every dollar spent. This opposition has the gall to complain about the cost impact of these proposals. Compensation will be made through increased pensions, direct payments and tax cuts. The assistance is permanent and it will increase, and, if people change their behaviour, those payments will make them better off because they are compensated as if they do not change their behaviour. But under our Low Carbon Communities fund we will help low-income households make the efficiency improvements.

Industry too will benefit. There is a significant package of grants and access to loans through the Energy Finance Corporation available to industry to assist them make the transition to cleaner energy options. We do not expect them to do it on their own.

Likewise, in the skills and jobs space there is significant assistance. It is going to be very important to develop the skills to strengthen our capability to get the competitive advantage that will be sought not just here but around the world, and there is a $9.2 billion Jobs and Skills package to develop green job skills to build our capability to develop better our competitiveness, a competitiveness that a carbon market will value and will reward.

Also, in terms of the farm sector there is a $1.7 billion package for carbon farming and biodiversity. Farmers do not pay the tax but under these initiatives they can be big winners. They can be winners through the Biodiversity Fund which enables them to access grants to improve soil and vegetation quality thereby lifting productivity. That is going to be of advantage because it will improve their farm outputs. But it is also a valuable service export to a world that increasingly is being challenged by the food security issue. There is also the additional opportunity under the Measures for Carbon Farming, where in the development of the capture of carbon, the measurement of it and the storage of it, they can trade the credits.

As for local government—because I have the responsibility for local government—here too there are significant opportunities in terms of landfill. We know that landfill generates methane. We are looking to encourage more innovative solutions for local government to reduce landfill waste and emissions, initiatives that involve recycling.

The Lismore City Council is a great case in point in recycling all of its organic waste. There is the capturing of methane gas for electricity, which is happening in the Shoal Bay waste disposal site in Darwin City. There is the flaring of gas, which is happening in the Moreton Bay Regional Council. And there is the diverting of compostable household waste away from landfills, and that is happening in the Hobart City Council organic waste measures. These are opportunities that we want to continue to encourage—to have the councils see the opportunities that are there in the challenge that we must embrace.

So this is a package of measures available to assist in making the transition, a package designed to reduce carbon emissions by five per cent by 2020. Interestingly, that is an objective shared by both sides of this parliament because it also happens to be the coalition policy, although you would not believe it when you listen to them. Both Labor and the coalition therefore agree on what needs to be done. The question is: how do we achieve it? This package of measures is our 'how'. The coalition package of measures, Direct Action—and I do not hear them talk about that much these days—has been ridiculed by all objective analysts. It gives no assistance to small business and it will make households pay an extra $1,300 per year. Yet they cry crocodile tears in arguing that ours is going to price people out of existence.

The Leader of the Opposition has become the Dr No of Australian politics. It is not surprising when you think of his background, because his background is around boxing and debating. He became the opposition leader and he is always looking for an opponent to knock down, and he always seeks the no case when it comes to a debate. His inflexible opposition to the measures in these bills—and they can complain all they like about the lack of time to debate this—means that we know what the end result will be under his leadership. It will be to say no. He will listen to no reason because he is hell-bent on opposing everything that is put forward. But in the opposition blindly following him down this path, they will be denying households their tax cuts and pensioners their pension increases, and imposing under his proposals another $1,300 on top for all households. They will be denying industry access to the land grants and they will be denying farmers the carbon farming initiatives.

I have had the opportunity over the last couple of months to visit many regions that are looking at innovative solutions. I have been to Geraldton and the midwest Gascoyne region of WA. They see themselves as the second Pilbara, but they have committed themselves as a town and a region to become carbon neutral. They are looking to renewable energy sources to power the huge growth that is going to happen. They have got private investment interested in coming there and they see this package as underpinning that commitment.

I have also been to Whyalla in South Australia where the Leader of the Opposition, Dr No, went and said that they would be wiped off the face of the earth when this package came in. I went to sites that were looking to increase job opportunities, sites involved in rare earth extraction. Because China has closed their exports of rare earths, there is the opportunity to extract and process rare earths. Why are rare earths important? Because they underpin green technology. They underpin smart solutions in terms of lighter ceramics and the sorts of technology, manufacture and fabrication that we are going to need for the challenges that are ahead.

Australia is the best placed of any country in the world in terms of its resources, its innovation and its capability. What we want is a market that recognises and values those things and that is why this package, the suite of measures that we are introducing, is designed to create that market to advantage and secure Australia's future going forward. We do not expect people to do it on their own and we have a series of transition measures that we are talking about. I have seen local government, I have seen businesses, I have seen regions rise to the challenge. They know what needs to be done. This side of the House also knows what needs to be done. We have taken the hard decisions. This is the same reform that we were prepared to embrace in the eighties and nineties to set the country up and that is why these bills need to be supported today. (Time expired)

Christopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | Link to this | Hansard source

I am pleased to rise to speak on the Clean Energy Bill 2011 and related bills or the carbon tax package of legislation. I begin by saying that in 2007 and 2008 I was a supporter of an emissions trading scheme. The Howard government proposed a policy in favour of an emissions trading scheme based on the Shergold report. Throughout 2008 and then into 2009, when the debate occurred over the Carbon Pollution Reduction Scheme, while the opposition at the time had serious concerns about the CPRS and attempted to make it better and assist the government to introduce an emissions trading scheme that was not able to be done for a number of reasons. Many of those reasons were because, in the negotiations that the opposition had at the time, the government, instead of accepting the good faith of the opposition and working with the opposition in order to bring about an emissions trading scheme, turned it into a political issue and used it to bludgeon the opposition on a daily basis.

We have seen already the precedent that this government establishes when it wants opposition support. It does not come to the opposition and say, 'Can we work together?' Even when the opposition offers to get the government out of a bind of their own making what we do not see is the government attempting to work with the opposition. What we instead see is the government abusing, hectoring and bludgeoning the opposition as though that will achieve the outcome that it is seeking. And so we saw that with the Carbon Pollution Reduction Scheme. When the member for Wentworth was Leader of the Opposition and did attempt to bring about an outcome that would see an emissions trading scheme he essentially had sand kicked in his face by the then Prime Minister, the now foreign minister, and the attempt to work together with the government was stymied by them in not negotiating in good faith.

Then of course the world changed at Copenhagen at the end of 2009 when all the goodwill that countries like Australia had invested in the Copenhagen process of bringing about a world response to climate change faltered on the rocks of the Copenhagen conference. China was one of the leading nations at the Copenhagen conference to ensure that there was not a world agreement to move forward and try to bring about action on climate change.

I support action on climate change. I believe that climate change is occurring and I believe that it is a mixture of natural impacts that occur whatever human beings do and of human beings playing a part in bringing about some change to the climate. I do believe that we should act on climate change and I did support an attempt to do that between 2007 and 2009. But the Copenhagen conference dramatically changed the world outlook on action on climate change.

The government responded in two ways. Firstly, they pretended that the Copenhagen conference had been a tremendous success and that they were going to plough on with their Carbon Pollution Reduction Scheme. Secondly, the then Deputy Prime Minister and Minister for Education convinced Kevin Rudd, the then Prime Minister, to abandon the CPRS. They did that for base political reasons because they believed that they were losing politically on the issue. Having done that the government dumped the then Prime Minister, the member for Griffith, and during the election campaign the Prime Minister deceived the Australian people in a bald-faced way by telling them that she would never countenance a carbon tax in any government she led. After the election the Prime Minister ditched that promise to the Australian people and that is the hole in the heart of this Prime Minister's stewardship of this government. That is one of the reasons that the Australian people have utterly lost faith in this government and in the authority of the Prime Minister.

Now we see the government trying to introduce a carbon tax which will do tremendous damage to the Australian economy. It will obviously export our emissions to overseas countries. It will export jobs to those same countries. It will not produce any environmental benefits. In fact, emissions will increase. It is a great big new tax built on a deceit during the election campaign which will push up the cost of living of every Australian whether they are a family or an individual and, of course, it will push up the prices for every business. I support the direct action plan of the coalition to address climate change. It is a 'no regrets' policy. What that means is that, even if you do not believe that climate change is happening, even if you do not believe the government should take action on climate change, because it is a hologram, these are still good policies and good changes that will benefit the environment and ensure that the Australian government is playing its part in ensuring that we have a better environment in the future and better environmental practices.

The direct action plan of the coalition achieves exactly the same target as the government's plan: a five per cent reduction in emissions by 2020. It does it without any cost to families, it does it without any new taxes and it does it without raising electricity prices—which of course the government will raise through its carbon tax. I can make that claim because every one of the $3.2 billion that has been allocated over the next four years for the coalition's direct action plan is funded out of savings which we announced at the last federal election.

There are no new taxes to pay for this policy, no new increases in prices, no imposts on business, no exporting of jobs and no exporting of emissions. And it is a 'no regrets' policy, which means that it is a good policy in spite of any views about climate change. There are no new taxes, yet the government keep making the claim that we will add an impost to Australian households. That is a complete fabrication from a desperate government prepared to say and do anything to try and convince the Australian people that they are not one of the most incompetent and inept governments in Australian history—'Please don't vote us out, because the opposition is worse.' The government are now at the point where they are trying to argue that, even though they admit they have made many mistakes and cost the Australian people many hard-earned dollars through wasted taxes—

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Sturt has been given a great deal of latitude on these bills, but we are actually dealing with the clean energy bills and I would bring him back to the bills before us.

Christopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | Link to this | Hansard source

I am talking about the carbon tax and the fact that the government are so desperate to try and hang on to power that they are prepared to pretend that figures that they have pulled out of the air actually reflect fact. But I hear your admonition, Madam Deputy Speaker, and because of my longstanding respect for you—

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

You are too kind, Member for Sturt!

Christopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | Link to this | Hansard source

I will move on to the direct action plan of the coalition. The direct action plan of the coalition has a number of elements. It establishes an emissions reduction fund. The funds that we have allocated to addressing climate change will be placed in that emissions reduction fund, and there will be a proper process by which the best ideas, the best projects and programs from around Australia, will vie for the funds out of the emissions reduction fund—ideas like capturing carbon in soil, planting trees on non-prime agricultural land, cleaning up waste coalmine gas, cleaning up landfill gas, promoting energy efficiency and converting some of the older, dirtier, coal fired power stations to gas. This would achieve exactly the same reduction in emissions, of five per cent, that the government claims it will do through its own policy.

One of my most serious objections to the government's carbon tax legislation is that it will very seriously impact on Australian households, individuals and families at a time when they can least afford it. Households are struggling with the rising cost of living, and yet the government's response to the rising cost of living is to slap a new tax, the carbon tax, on the Australian people through this legislation, which will push up cost-of-living pressures even more.

The South Australian Council of Social Service's annual Cost of Living survey shows that since 2001 food prices have gone up 13.2 per cent, utilities have risen 33.4 per cent, health costs have gone up 22.8 per cent and rental costs have gone up 8.4 per cent above inflation. In Adelaide, utility prices have skyrocketed, with a 37 per cent increase in electricity in August this year, a 14 per cent rise in gas prices and a 30 per cent increase in water prices.

One of the roles of any government is to do no harm to the Australian people. Yet this carbon tax does direct harm to the Australian people through increasing prices at a time when they can least afford it. Now is the time for the government to be reducing pressure on households, families and individuals across Australia. Now is the time for the government to find measures that reduce the footprint of government in the Australian society, reduce regulation and reduce red tape, not create new programs which require more bureaucrats, more regulation, more red tape and more spending.

Ms Plibersek interjecting—

We know that the member opposite, the member for Sydney, has been in favour of every spending proposal that has ever come across her desk as a minister or as a member. As a leading member of the Left, she has never even thought of any possibility of saving taxpayers' money because, as far as she is concerned, it is her money. The member for Sydney regards the taxpayers' money as her money.

This carbon tax will also cost jobs. It will export jobs overseas. Every government in Australia along the eastern seaboard and Western Australia have done their own analysis of what the carbon tax means, and it is not good news for those people who need their jobs to be able to pay their mortgages or school fees, or just to pay their grocery bills.

The Deloitte Access Economics report that was commissioned by the Bligh government—which, last time I looked, was a Labor government—predicts that Queensland's gross state product would be 2.76 per cent lower by 2020 and 4.11 per cent lower by 2050 than it would be without a carbon price. It predicts the loss of 21,000 Queensland jobs and a net loss in the economic value of the state's generation companies of $640 million, meaning higher electricity prices. The Victorian government commissioned an analysis, which found that 23,000 jobs that would have been created will not be created across Victoria by 2015 as a result of the carbon tax and that the Victorian economy would be $2.8 billion worse off in 2015 and $3 billion worse off in 2030. In New South Wales, analysis commissioned by the Labor government and released by the O'Farrell government found that 31,000 jobs will be lost in New South Wales by 2030 and 18½ thousand in the Hunter Valley alone. In Western Australia, the Western Australian Treasury has shown that over half of all Western Australia households will be worse off because of a carbon tax.

In the closing minute of my speech on the carbon tax legislation, I want to deal very briefly with the issue of the government hypocrisy in even being prepared to come into this House and introduce this legislation. I do not need to remind Australian people of the Prime Minister's promise:

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

They certainly have that indelibly printed on their minds. Then there was the Treasurer's promise:

We have made our position very clear. We have ruled it out.

But someone obviously did not tell the Minister for Finance and Deregulation that they were going to go ahead with a carbon tax, because during 2009 and 2010 she said things like, 'A carbon tax does not guarantee emissions reductions,' and, 'A carbon tax is not the silver bullet some people might think.' We know that she cannot have any environmental certainty with a carbon tax when she says:

I have been very upfront about why I think a carbon tax isn't the most sensible thing for Australia.

I could not agree with her more. (Time expired)

Deborah O'Neill (Robertson, Australian Labor Party) Share this | Link to this | Hansard source

I heard the intense argument coming from the shadow minister for education, apprenticeships and training regarding this package of clean energy legislation, but the reality is that he is on the record with a few interesting comments of his own. On 27 July 2009, he made these comments on Sunday Agenda:

Let's not forget it was the Opposition that first proposed an emissions trading scheme when we were in government. The idea that … the Liberal Party is opposed to an emissions trading scheme is quite frankly ludicrous.

We are on our way towards that goal and I think there is too much protesting by far going on on the other side for no reason other than simply to obstruct the progress of this nation. Again, in December 2009, he said:

… we took an emissions trading scheme to the last election. We believe in climate change action.

Judging by today's speech, you could have fooled me that he really believes that. Mr Pyne said on that day:

I believe passionately in climate change action.

Today he is passionately telling us that there is nothing wrong and we should advance no cause. Somewhere in the middle perhaps lies the truth, although I would not be absolutely confident of that in this context.

I welcome this day. I am very proud to stand here as a Labor member to add my voice to those of the Prime Minister, the Minister for Climate Change and Energy Efficiency, my colleagues and fellow travellers in this place to support this historic legislation. Today, after years, decades even, of public debate on climate change, it is our Labor government, through these landmark clean energy reforms, that is setting our country on course for a secure, sustainable, clean energy future. Let no-one be tricked by those who seek to diminish and dismiss the importance of this challenge. For years, governments all over the world have wrestled with the reality of climate change. And no government has taken as measured, as methodical or as inclusive an approach to this issue as the Gillard Labor government.

There was exhaustive debate in the last parliament about an emissions trading scheme, two major reviews by Professor Ross Garnaut and no fewer than 35 parliamentary inquiries. No one issue has had so much parliamentary scrutiny. The public scrutiny has been even longer and just as intense. There were the policies for action on climate change that Labor took to successive elections, through to the government's formulation of our Clean Energy Future package at a macro level. At a micro level, the Clean Energy Future materials all householders received over the last month have ensured that, despite those who would spread fear and alarm, the detail and reality of our careful and household centred package of support is now available to all. We have spread the message and the facts—the real information—far and wide. At Kariong, in my own electorate, the Minister for Regional Australia, Regional Development and Local Government provided a carbon pricing forum just last week. We have been comprehensive and inclusive in our approach—because that is the Labor way.

Now it comes to us in this House to act. I strongly believe that our role as members in this place is to make the difficult decisions, not for the short term or for narrow political interest but for the long term and the national interest of our constituents. I am so proud to have as my leader here in this place a strong woman, our Prime Minister, who is committed to leading our nation, taking determined action for the long-term national interest. I have absolute confidence in her.

The future of my children, my nieces and nephews, my former students and their own children—all these young people—matters to me. I care deeply for their future and I know that I am absolutely in unison with the thousands of Central Coast residents who are dedicated to building a great future for our kids. I will leave no stone unturned in doing everything I can to make sure that there are jobs and opportunities for our young people where we live. This is the Labor way—rising to the tough challenges and faithful to those ordinary Australians who live alongside us as equals, not beneath us or subordinate to us. It is the opportunities and jobs for the future of the Central Coast that I am most excited about when I look at the package we are debating today.

As the minister for regional Australia explained last week at Kariong, a clean energy future will allow regions like the Central Coast to diversify their economies in a way that was formerly unimaginable, by encouraging the uptake of new skills and by the development of smarter, clean energy economies. A price on carbon will provide an incentive to cut our carbon footprint, create sustainable environmental jobs and drive different renewable energy options.

I know that the people on the Central Coast are avid early adopters of the massive uptake of various solar energy initiatives we have seen across the coast at federal and state levels. As a region we want our fair share of the projected $100 billion that will go into renewables by 2050. And we on the Central Coast want our fair share of the 1.6 million new jobs that Treasury modelling is projecting by 2020. We want a future for our children that embraces a sustainable region not only in terms of the environment but also in terms of the work and opportunities that our growing community needs. The people on the Central Coast love where we live. We are committed to making sure that, for our time of custodianship of this land, we act in a way that allows our children and their children's children and further generations after that to enjoy our place. That is why Labor is determined to undertake this major structural economic reform in a way that not only meets the environmental challenge but also ensures that we make sure our people, ordinary working Australians, do not bear the burden of this major structural economic reform.

That is why nine out of 10 households will receive assistance through some combination of tax cuts and payment increases. Two in three households will get tax cuts or increased payments that cover their expected average price impacts, and over four million Australian households will get assistance that is in fact 20 per cent more than their expected average price impact. And, yes, this assistance to households will be permanent, ongoing and indexed to the CPI.

On the same day that the Minister for Regional Australia, Regional Development and Local Government was holding a forum in my electorate, the Leader of the Opposition was also on the Central Coast, deliberately spreading his poisonous misinformation about this assistance. To the Leader of the Opposition I say this: this government is about caring for older Australians. All you are about—and all you revealed on your visit to the coast—is a capacity to scare older Australians. So I repeat: the Gillard government's household assistance under this legislation will be permanent, ongoing and indexed to the CPI. That will include very many households on the New South Wales Central Coast.

In addition to this, one million Australians will no longer need to lodge a tax return. That is going to be a very welcome piece of news to very many Australians, and particularly to those people who are going to be earning up to about $20,000 now without having to engage with the taxation system. I have spoken to many people on the Central Coast, particularly mothers and grandmothers, who will now consider taking up part-time or casual work because we are tripling the tax-free threshold through this legislation.

Some of those opposite acknowledge that there is a problem with carbon pollution spewing into our atmosphere. That is why their policy goal for 2020 is exactly the same as the Labor goal: a five per cent reduction in emissions by 2020. But their solution is to pay big polluters to pollute and punish ordinary working Australians. That is the difference between us and them. We in the Labor Party have in our DNA a deep commitment to the ordinary householders and workers who carry this nation each and every day. The Leader of the Opposition's plan is to take $1,300 from ordinary households—from people like those I represent in Umina, Kincumber and Woy Woy—and use their hard-earned money. These constituents on the Central Coast in the seat of Robertson can ill afford the irresponsible $1,300 bill that the Leader of the Opposition would give them. That is right: those opposite would take from the little guys and give to the big guys; they would subsidise polluters and rip off regular families in areas such as mine.

This is the bottom line. It is the dark underbelly that is the reality of the modern Liberal Party, because the buck never stops with them. If those opposite were true conservatives, they would respect the institution of the CSIRO—an institution that a conservative prime minister established. Instead, those opposite have trashed and ridiculed the sensible, mainstream science of that treasured institution. In my role as a member of the Australian parliament, I respect mainstream science and I certainly respect the CSIRO. I respect the intellect and integrity that informs that institution, and I acknowledge the great guidance that the CSIRO and other such learned institutes have provided the Australian public over many, many generations. It is well known that if global emissions continue to increase at the present rates then we face the certainty of dangerous climate change. These are the conclusions of sensible, mainstream scientists—scientists that the Leader of the Opposition continues to call 'crap'.

I support the clean energy bills because they will provide the incentive mechanisms needed to drive private investment in clean energy. As one of the biggest per capita polluters in the world, Australia cannot claim that as a nation we do not have the ability to reduce our national emissions. Furthermore, I do not believe that those opposite can deny that it is in the nation's interest to provide an incentive to invest in clean energy. Indeed, if they were true to their party's policies they would be supporting sensible, practical measures designed to reduce our emissions by five per cent over year 2000 levels. If those opposite were true to their principles they would support a market based mechanism. They would support that to enable the private sector to invest in a clean energy future.

I support the government's market-based solution because it is right, because it makes the big polluters pay for polluting and because it provides a powerful and correct incentive for the industry to invest in a clean energy future. The details of the government's clean energy plan have been debated at length both inside and outside this parliament. It is important to understand that the fixed price of carbon is only a temporary measure and that it will only operate for a short period of time until an emissions trading scheme is implemented in 2015. The charge of $23 per tonne will rise in accordance with inflation over the next three years. According to the fixed-price mechanism, businesses covered by the legislation will be charged $23 for every tonne of carbon pollution they put into the atmosphere.

Finally, I want to bring in a faith perspective to this debate in the House today. I want to put on the record in the chamber the response of Christians who take seriously the words of the Holy Bible, in particular Genesis chapter 1, verses 28 and 29, and Genesis chapter 2, verse 15. They are the elements of the Bible that we often hear about, on the intimate relationship with the earth on which we walk. The intimacy of humankind's relationship with the earth is embedded in these famous pieces of text. The custodianship of the earth and the incredible responsibility that that confers on each of us is to keep the earth and to replenish the earth, and that is not lost on Christians whose faith provides the moral compass of our lives.

The understanding of the importance of the response to the challenge of climate change is well articulated in the Australian space by the Micah Challenge group, who are so active in our communities and determined to ensure that Christians are taking up our share of the burden in achieving the Millennium Development Goals. I know that many of those opposite support the Micah Challenge. I know that they worship in communities that support the Micah challenge. They need to heed the very clear advice that impels us as Christians to act to price carbon and to undertake the change to a clean energy economy. It is time for leadership and responsible action, particularly by those who express a Christian faith and have this discourse to inform their conscience and their political action in this place.

This is no time for carping negativity, for selfishness or for cheap political stunts. The future we create for our children and their children and the future we offer all who share this planet with us depends on our capacity to get out of our own way, to abandon selfishness and to act for others. In the long term, millions of others will receive the benefits of this honest and responsible enactment into law of wise custodianship of our earth, our sea and our sky. In the true Labor way, we have ensured that ordinary Australians, for whom we are the voice in this place, will be assisted financially through this major economic reform which will set us on a path to a clean energy environment and 1.6 million clean energy jobs—and all of that by 2020.

I close by encouraging all people of Christian faith and all members of this House to consider the clear advice that impels us to act in the interests of our country and the future of our planet. I commend these bills to the House.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

I rise to speak on the Clean Energy Bill 2011. In the absence of a global emissions trading scheme, imposing a carbon tax in Australia is an act of economic self harm and totally futile from an environmental perspective. I think that both sides of the House share the view that we should protect our land and our country, but this bad policy does nothing. There is no obligation to support bad and futile policy in the pursuit of supposedly protecting our land.

To better understand why going it alone on a carbon tax will harm the Australian economy, think for a second about the question solely in an Australian context. What would happen if a great big new tax on carbon was levelled at businesses only in my home state of Victoria and in no other state? In no time at all, in order to remain competitive, Victorian businesses and jobs would start to relocate—to the great detriment of the Victorian economy—to New South Wales, to Queensland and to other states where no tax was applied, and the emissions that relocating businesses generated would go with them. If you go back and think about the proposed carbon tax, you will realise that the same thing will happen, except that in this case it will happen on a global basis, because our businesses, becoming increasingly uncompetitive, will simply relocate to other parts of the world, and the emissions created by those businesses will go with them. Australian businesses, jobs and emissions will relocate where no tax applies.

Key Republican congressman on climate change Jim Sensenbrenner, who led the US congressional delegation to Kyoto, described what the Gillard government is doing as 'unilateral economic disarmament'. We know that the prospects of either a cap-and-trade system or a carbon tax are dead in the US. We know from key Democrats that President Obama will not be campaigning on either in the lead-up to next year's election. After the failure of the Copenhagen conference, the world is further away from a global agreement than it has ever been. The government lectured us for three years about the importance of a global scheme in the lead-up to the last election, but now we are being lectured about the importance of bringing in a scheme unilaterally. The world is further away from a global arrangement than ever before, yet there is urgency here, in the face of very difficult economic circumstances for many sectors of manufacturing, to bring in a great big new tax. It makes no sense unless you look at the politics behind the introduction of this bill.

While the Gillard government likes to highlight the European emissions trading scheme as a reason that we need to undermine our great strengths, even in Europe there is a high degree of pessimism about the prospect of a global scheme. In fact, the UK parliament's Energy and Climate Change Committee recently launched a new inquiry into the EU emissions trading system. The committee said that, in the absence of binding emissions reduction commitments under the UN reduction framework, the scheme 'is looking increasingly isolated'. It went on to say:

The lack of an international framework for emissions reductions and carbon trading poses some serious difficulties for the future viability of the EU ETS …

Regardless, though you would not know it from the rhetoric, the European scheme—which has been the subject of huge rorts—is really nothing more than a pilot scheme, is a mere pilot compared to the carbon tax proposed here. The European scheme does not apply at all, in many cases, to electricity generators, much less many other trade exposed industries. The Gillard-Brown scheme will raise more in revenue in its first four months than the European trading system has raised in total over the last five years.

If you were to put a price on carbon, this scheme would be just about the most inefficient and most complex way you could go about it. It is the most bureaucratic, the most interventionist and the most socialistic scheme that you could contrive. There are many other schemes that you could use if you were to put a price on carbon. There are even cap-and-trade schemes which you could design to put a price on carbon and which would give you exactly the same price but not strip the balance sheets of companies, which is what will happen with this government scheme—they will tax every tonne of CO2, and the cost of abatement is only one-sixth of the total tax take. This is a scheme designed to maximise the tax return—as we are seeing in Ireland, where they have just doubled the price of carbon because they have a fiscal problem. The same thing will happen in Australia, and it will not be one scheme but 500 schemes.

The so-called '500 big polluters' that Labor has raged about for 12 months no longer matter, but we still do not even know which companies will be taxed. When we do, however, there will be bureaucrats crawling all over them. Under the government's scheme, different activity definitions apply, different levels of assistance apply and the enormous tax churn not only underscores the scheme's inefficiency but also suggests that, first and foremost, the scheme is a vehicle for wealth redistribution. Herein lies the fundamental difference between the carbon tax and the coalition's far more efficient direct action policy. The carbon tax approach requires many tens of billions of dollars in compensation because of the huge increases in electricity prices, and the direct action approach requires no compensation because it does not drive up electricity costs. Frontier Economics exposed this fact with an analysis it did based on Treasury's 2008 modelling of a carbon price. Looking at electricity generators alone, it found that the cost of technology to reduce CO2 emissions from 2012 to 2020 was $6.6 billion—that is, the cost of abatement for electricity generators over the next eight years would be $6.6 billion. During that period the government would reap not $6.6 billion but $37.5 billion in tax from the generators, and consumers would pay an additional $45 billion for electricity—the price would be passed on to electricity consumers. This shows that those who are creating the CO2—the so-called 'big polluters', the derogatory term used by this government—are not paying. It will be consumers who pay, and everyone knows this. The government is doing itself a great disservice by trying to imply that the tax falls on the so-called 'big polluters' and not on individual Australians and small business.

This shows, too, that the government's tax take is almost six times the actual abatement cost, and the increased cost of electricity is nearly eight times the actual abatement cost. As Frontier's Danny Price prophetically said earlier this year 'the excess tax will be churned via the political process which will bring its own distortions'. Bureaucrats will be making decisions about technology and innovation, not companies themselves. This town will be crawling with lobbyists seeking some investment crumbs from the government's table. It is a giant money-go-round, but the money will end up in the hands of politically well-chosen beneficiaries. Danny Price said that political control of so much tax revenue explains why the Greens have been such enthusiastic supporters of the carbon tax. He said, 'They will be in the box seat in deciding how these funds will be distributed,' and he was spot on.

These bills will provide for the creation of the $10 billion Clean Energy Finance Corporation—or the Bob Brown bank. The slush fund—

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

Order! The member knows he must refer to people by their appropriate titles.

Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Link to this | Hansard source

will be all borrowed money. It will be used to fund high-risk pet projects of the Greens and Labor, projects the private sector would not touch with a barge pole. The lessons of the failed Tricontinental bank, the failed State Bank of South Australia and WA Inc. are so easily forgotten. It is criminal; it is pure politics; it is not policy inspired. No less than Don Argus said he was bemused that such vast sums of money were being staked on risky and expensive renewable energy and not carbon capture and storage—it was explicitly excluded from those $10 billion funds. He said:

This example highlights just how politically expedient this government's tax reform agenda has been. … The government has rushed ahead with proposals that are … not in the best interests of our country—

despite the endless mantra about what is the in the interest of the country being pursued.

While Senator Brown rages against foreign ownership in mining, he remains silent about wind farms. About 30 per cent of Australian wind farms are foreign owned and their manufactures are all foreign owned. Doesn't he have a problem with this—their proliferation and the way they are shattering communities?

We know from the lessons learned in Europe that all the talk about green jobs, which will replace jobs in traditional industries, is pure nonsense. In fact, it is quite disingenuous the way in which this government comes into this House every day to talk about green jobs. The US study by Verso Economics recently found that for every green job created 3.7 jobs in other parts of the economy were destroyed. This supports similar findings from Spain, Germany and other parts of Europe. This is what we can expect in Australia in manufacturing, mining and resources. Thousands of jobs will be lost—and the cost of green jobs is extraordinarily high, compared with traditional jobs.

Look at the billions this government has wasted on green rip-offs: $2.4 billion on pink batts, $850 million on solar homes, $300 million on green loans and, despite the enormous tax take under this scheme, $9 billion a year that cannot even make the numbers add up. Incredibly, this scheme will cost the budget $4.3 billion over the forward estimates. That is a real black hole, yet, according to the Treasurer and the Minister for Finance and Deregulation, this adds up to broadly budget neutral—and they wonder why people are so sceptical about their management skills of this economy. No wonder they are a laughing stock. Senator Wong wants nothing to do with this carbon tax. Here is a snapshot of her past comments:

The carbon tax does not guarantee emissions reductions.

…   …   …

A carbon tax … is a recipe for abrupt and unpredictable changes.

She goes on to say that the introduction of a carbon price ahead of effective international action can lead to perverse incentives for such industries to relocate or source production offshore. That is the current finance minister, the former Minister for Climate Change and Energy Efficiency. These are all contradictory in terms of the carbon tax policy that has been laid down and which we are debating here today. I could not have said it better myself.

They are also creating six new bureaucracies to administer this dog's breakfast of a scheme. This will cost a staggering $382 million. I went to Tasmania recently, where they built a beautiful dam for $34 with hydro. It changed the economics of that small region. You could build 11 of those around the country for the cost of the carbon tax bureaucrats each year. By contrast, the coalition's direct action policy will cost $3.2 billion over four years and it will be transparently funded from savings within budget—and capped. Virtually all this money will be spent on purchasing least-cost abatement through competitive tender.

Competitive tendering is a market based system but one which does not come with tens of billions of dollars of new tax and tens of billions of dollars of higher electricity charges. Direct action is a no-regrets policy. If there is still no global agreement by 2020, Australia will have remained competitive while reducing emissions by five per cent, avoiding tens of billions of dollars of tax, yet still in a good position to assess the way forward from there. The direct incentives to invest in lower energy and emissions technology in our business sector, greater carbon levels in our soils and tree planting in appropriate areas will see major productivity gains regardless of action taken by the rest of the world.

On the other hand, going it alone with a carbon tax and then an emissions trading scheme is highly irresponsible. This politically inspired going-it-alone policy approach guarantees that Australia will be far worse off than if a global agreement applied. In fact, under a global scheme, closures of inefficient power generation and value-adding resource plants, such as zinc and aluminium smelters, would occur elsewhere in the world first. This carbon tax will deliver around 40 million tonnes, or just 25 per cent, of overall abatements. The world economy is facing the likelihood of a further major slump over the next 12 months, yet this government wants to introduce an economy-wide tax. I urge any government members opposite who want to do the right thing by our nation and our communities to reject these bills. (Time expired)

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

If I ask the member for Warringah or the member for the Cowper at the table whether they want to live under an emissions trading scheme, I suspect their answer would be no, yet the joke is that they already do. The New South Wales Greenhouse Gas Reduction Scheme was introduced on 1 January 2003. To quote from the website:

It is one of the first mandatory greenhouse gas emissions trading schemes in the world.

The new Liberal-National government in New South Wales maintains this scheme and it covers the seats of Warringah and Cowper. It is this same greenhouse gas abatement scheme that the member for Warringah himself openly says is the backbone of Liberal and National party policy on climate change nationally.

I have advocated for a price on carbon through emissions trading since my first speech in this chamber. At that time I said that I looked forward to working with members and ministers on both sides on water quality, catchment management, natural resources management and renewable energy issues throughout the Mid-North Coast. We as a region are really well geared to address these other local issues if we can get some offset returns through the emissions trading scheme. My view over the past three years has not changed; if anything, it has firmed. At the last two federal elections at which I stood, in 2008 and 2010, I was open and honest with my communities and said that, if elected, I would be working on pricing carbon via emissions trading. I have remained consistent and today have delivered on those election commitments. Unlike many others who chop and change or describe themselves as weathervanes on climate change, my word is my bond and I do what I can to uphold that bond.

So I stand up for the new economy of Australia, I stand up for jobs and I stand up for fewer taxes, and I do this by strongly supporting Australia moving to an emissions trading scheme in 2015. On behalf of the 90,000 residents of the Mid-North Coast, I personally chose to participate in the Multi-Party Climate Change Committee process—a unique cabinet process established to make sure that this time moral challenges will actually be delivered. My position on the Clean Energy Bill 2011 and associated bills is therefore well known to all. I will support these bills. I also expect the members for Melbourne, Denison and New England to support these bills and therefore expect these bills to pass.

After all the discussion and debate on this issue over many years, I hopefully have time to say three more things. First, I say why I support these bills. They are the same reasons I have stated every time this issue has come before the parliament and they are the same reasons I have stated in open letters and public forums throughout my electorate over many years. At elections in 2008 and 2010, I publicly and openly supported a price on pollution in emissions trading markets. Unlike almost every other Australian politician, my position has not changed. In my view, common sense tells me to seek and trust expert advice. If your child is sick, you go to the local doctor for trusted medical advice. If you are planning to retire, you seek trusted financial advice. The issue of climate change is no different. Even the most conservative Australian scientific advisers, including the CSIRO, who we have trusted for 70 years, tell us that climate change is a risk demanding a response. The most conservative Australian economic advisers insist that the lowest-cost response is to make the biggest emitting businesses reduce or pay for their emissions. I have chosen to respect and accept this expert advice on both the science and the economics. In my view, politicians who reject this advice ignore the scientific risks and accept higher long-term economic costs.

The features of this package before the House that improve on the old CPRS—that at one point, I remind everyone, 148 out of the 150 members of this parliament publicly supported—are many. Included in the improvements negotiated through the MPCCC is a better governance model with the independent Climate Change Authority. Members can check unsuccessful amendments last time around with the CPRS and will see my consistent position on this. It is important that this is now a governance feature piece. I am pleased this suggestion helped as a circuit-breaker in the trench warfare on emissions targets between the Labor Party and the Greens that had stalled this issue for too long. This is an important improvement that removes the toxic debate and focuses decisions on independent science and independent economic advice.

Secondly, we have increased benefits to protect pensioners, retirees and low- to middle-income earners from consumer price changes of less than one per cent. Thirdly, we took the opportunity for tax reform, turning Ross Garnaut's very good work into Ken Henry's very good tax reform work, and achieved substantial tax reform as part of the agreements reached. Fourthly, we worked to assist key industries and helped small business to adjust, including $150 million for adjustments in the important food processing sector and financial support for small business. Fifthly, we have allowed new resource and development funding that will allow us to keep pace with the world in both renewable energy and in carbon farming. Sixthly, we now have a $1.8 billion land sector package that does push back on behalf of marginal lands, pushes back on concerns of the international peak soils crisis globally and pushes back on behalf of the high loss of biodiversity in Australia's unique ecosystem. I thank those who took the time to participate in the land use forums that I hosted in the parliament earlier this year, at a critical time in the decision-making process around this. It did and does matter.

Finally, and I think importantly, we have negotiated Indigenous enterprise in land use and the targeted land sector provisions for Australia's original—and, in my view, best—land managers. I am pleased to hear that the two groups who are already hitting the phones to environmental planners on this topic are agriculture companies and individuals as well as Indigenous enterprises, both looking for ways to value-add to the 18 bills before the House today.

All of this is done with a firm eye on the macro-economy. I can confirm that undisputed, independent Treasury advice identifies our economy will continue to grow and our standard of living will continue to rise, even with a price on carbon. The Australian story for the next 50 years is a good story not a bad one. We really do live in the right place at the right time. Reform for the better suits these times. It is my firm view therefore that the bills before us are the best overall solution to the real climate risks facing Australians of the future and that our generation does owe it to future Australians to resolve this issue now. I acknowledge that many members of parliament and community members do not agree with this decision, but I am confident that at least they understand it and I am confident that consistency in thought is at least respected.

This brings me to my third and final point. In the politics of the debate in Australia, the one thing that has hampered constructive public debate on this topic is the lack of detail, clarity and consistency of the major parties. I include the Labor Party, the Liberal Party and the National Party in this criticism. They have collectively been consistent in their inconsistency on pricing carbon. Today we see the Liberal and National parties, in opposition, showing all care on pricing carbon and absolutely no responsibility. They say they care, but a responsible opposition would at the very least put an alternative policy to the legislature for debate. They have not. They have called for a plebiscite as a demonstration that they have private members' powers to contribute to the parliament, but they deny the Australian people to look at or see the details of this alternative policy.

What have they got to hide? This is not a choice in this House between an emissions trading scheme or nothing. It is a choice between an emissions trading scheme or what I consider a Liberal-National party grants tax that Australia is consistently being denied the details of. I was disappointed again today to see the member for Warringah once again dodge the opportunity to table their alternative for the House to consider. Consider this—and this is not politics at play—if parliament rejects the current 18 bills before the House, those of us like me who have consistently supported action on climate change must consider supporting the Liberal-National parties' alternative option. But what is the alternative?

If I asked the member for Wide Bay or the member for Warringah the following six questions, I am assuming at this stage the answers would be 'yes'. Firstly, do the Liberal-National parties support a five per cent reduction in carbon dioxide emissions by 2020 on 1990 levels? My understanding is: yes. Secondly, do the Liberal-National parties support the words spoken by the Leader of the Opposition in the launch of his policy in February 2010 that their policy is modelled on the New South Wales Labor government's GGAS, meaning a lot of emissions reduction at comparatively modest cost? My understanding is: yes. Thirdly, would the Liberals and Nationals establish an emissions reduction fund to invest an annual average of about $10.2 billion in direct CO2 emissions reduction activities by 2020, funded by tax revenue? My understanding is: yes. Fourthly, will the emissions reduction fund purchase 85 million tonnes per annum of CO2 abatement through soil carbon by 2020, regardless of whether soil carbon is in any relevant future international agreement—at an estimated cost of $8 to $10 per tonne—and is this the single biggest investment the emissions reduction fund will make? My understanding is: yes. Fifthly, will the emissions reduction fund be prevented from purchasing emissions reductions from overseas, even if those emissions reductions are verifiable and less expensive than those able to be purchased in Australia? My understanding is: yes. Sixthly, and finally, if a business that already reports under the Howard-Costello-Vaile-sponsored National Greenhouse and Energy Reporting Scheme undertakes an activity with an emissions level above its business-as-usual level, will that business incur a financial penalty? My understanding is: yes.

In other words, the Liberal Party and the National Party are pursuing the same reduction in emissions, relying heavily on just one technology, to be purchased at an assumed price by a government fund—with any trade in carbon emissions specifically prevented. Big emitters under this approach face the real possibility of financial penalties if they expand, with no opportunity to buy offsetting abatement from another source. This is a potential job killer and a potential economic growth killer.

With this in mind, there are two more questions I would like to ask and have answered, but the answers at this stage are critically unknown. Firstly, will the Liberal-National party members of this parliament match the $14.2 billion over four years in reduced income taxes, Indigenous employment, soil research, biodiversity funding and higher benefits provided for under the package currently in the 18 bills before the House and, if not, what exact level of reduced income taxes or higher benefits would the Liberal and National parties provide and how would these be funded? Secondly, if the Liberal-National party members of this parliament think they can buy abatement at $8 to $10 a tonne, how do they justify any argument that says the market price in an emissions trading scheme would not be the same?

Surely the price of a tonne of carbon is either $8 a tonne or $29 a tonne in 2015. Which one is true? Again, until this is answered, in my view they debate with false anger. At this stage, on this difference between $8 a tonne and $29 a tonne, someone's policy in this debate is a fraud. I am backing $29 a tonne in 2015 based on all sound economic advice, yet it is unknown how on earth based on this advice the coalition can then buy in at $8 a tonne. What product in history in any market economy can be bought at one-third of its price on an ongoing basis? Do we buy milk at 80c a tonne when it is $2? Do we buy bread for $1 when it is $3? How is this so? Please, member for Flinders, member for Warringah, member for Wide Bay, explain your policy.

I would be grateful if that is answered in this debate. Until then, I strongly support the 18 bills before the House. I strongly support pricing carbon. It is not a tax. We all know you cannot buy and sell a tax. This is a carbon permit trading scheme. It is the smartest, lowest cost, lowest risk solution to the very real science question before us. I strongly encourage this House to this time, importantly, in the national interest, back this package.

Warren Truss (Wide Bay, National Party, Leader of the Nationals) Share this | Link to this | Hansard source

The Constitution of Australia requires in section 52 that the parliament shall make laws for the 'good government of the Commonwealth'. This legislation is not good government, it is not good law and it is not good for the people of Australia. It is an incredible piece of national self-harm, a massive new tax that will add to the cost of all that we do, a new tax that will cost Australian jobs as industry relocates to other parts of the world that do not have a tax like this. It is a massive new tax that seeks to destroy our competitive advantage by artificially raising the price of electricity. It is bureaucratic, it is concocted, it is illogical, it is negative, it is dishonest, it is inconsistent and it is structurally unsound. It will do nothing for the environment in Australia, and indeed it will increase global emissions. With all the overblown rhetoric that we have heard about this scheme and about the legislation before the House, it cannot possibly achieve its objectives.

Is it any wonder that the public are bewildered? They see this as a gigantic scandal, a fraud being perpetrated on the Australian people. They are asking: 'How could our government do such a thing? How can a government that is interested in the welfare of the people do such a thing? Why do they want to hurt us so much? Why won't they listen when we cry out for sensible policies?' This is a monumental piece of government incompetence. It will be a $9 billion tax in the first year and collect well over $30 billion in the first three years, but it still leaves behind it a $4.7 billion black hole, and that is without the compensation that will have to be paid to close down coal fired power stations. This is simply illogical. US Congressman Jim Sensenbrenner put it correctly when he described what Australia was doing as 'unilateral economic disarmament'. It simply makes no sense.

It is a tax that is based on two broken promises by the Prime Minister. At her very first media conference after the coup that removed the member for Griffith, the member for Lalor said that she had convinced her predecessor to dump his carbon pollution reduction scheme because he did not have community consensus:

I came to that decision because I fundamentally believe that if you are going to restructure our economy so that we can deal with a carbon price and deal with all the transformations in our economy that requires, then you need community consensus to do so.

You must have community consensus. There clearly is no community consensus in favour of the carbon tax. There is very strong consensus in opposition to the carbon tax. The Prime Minister has broken her promise to develop community consensus before taking action to implement a carbon pollution reduction scheme or a carbon tax.

The second broken promise is even more profound, and it rings in the ears of every Australian every day when they are talking about this issue. Infamously, before the 2010 election, she said:

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

She later went on in a pathetic way to say she did not really mean to mislead. If she did not mean to mislead, why didn't she correct the statements that were in the media before the election instead of waiting until after the event, when she was trying to negotiate to get the keys to the Lodge, to walk away from that commitment? It was a fundamental breach of trust.

The chairman of the company produced a prospectus and asked the shareholders to invest in the company. The prospectus included a promise that there would be no carbon tax. As soon as the share offer was over, the prospectus was changed and revised. The prospectus was false. If our Prime Minister were a company director, she would be heading for a long term in jail. But she is the Prime Minister and she is not in jail; in fact, she is still in the Lodge. But she still fundamentally misled the shareholders of the company. I know some of the other company directors are now plotting to get themselves a new chairman, but it is not just the chairman who is to blame; it is the whole company. As I see members opposite standing in this House to defend this legislation—members who have refused to speak out in their own electorates even though they know this legislation is going to devastate local industry, who have already seen factories close with the threat of this legislation but refuse to speak out—they are just as culpable now as the chairman of their board. How could anyone believe any of them ever again?

They identified themselves with the promise; they have now identified themselves with the breaking of the promise. Is it any wonder that public respect is at an all-time low for this government and its Prime Minister?

My greatest concern, my deepest regret, is the damage that this is doing to our democracy as a whole. The public respect for our parliament is in decline. Lasting damage is being done to the profession of members of parliament. When members' word is not their bond, when they make promises to the people before the election and then walk away from them as though nothing had ever happened, is it any wonder that the public are upset and disgusted with the performance of this government?

We know why it has all happened. The Prime Minister was so keen to get the keys to the Lodge that she was prepared to make any compromise. She was prepared to cave in for the carbon-pricing ambitions of the Greens. The Independent members for Lyne and New England are just as culpable as the Greens in driving this extremist and pointless agenda. I recall the infamous press conference where the Greens and the Independents took over the Prime Minister's courtyard and grinned at the Australian public as they announced the ditching of Labor's no-carbon-tax promise and the harshest carbon tax anywhere in the world. The member for Lyne certainly wanted a new carbon tax, as he made it abundantly clear in his own recent remarks. He had said previously, 'Let the market rip, let the science fly.' He also made that clear when discussing the CPRS bills. He said the Prime Minister's plan did not go anywhere far enough. The member for New England rejected the CPRS bills because they did not go far enough. He said a five per cent reduction was nonsensical and he wanted an 80 per cent cut in emissions by 2050, but more of that shortly.

The reality is that the government ditched their promises and their commitments because they were so desperate they were prepared to trade off anything to get the keys to the Lodge. But then there was the so-called Multi-Party Climate Change Committee. It just had Greens, Labor members and Independents. You were not even allowed to be on the committee unless you were fundamentally committed to Labor's version of the carbon tax. You were not even allowed to participate in the process unless you were determined to deliver on exactly what the Greens and the Independents wanted. This tax is just like that committee—a camel—full of anomalies. Everybody got their little piece. There was no consultation with the community. There has been no attempt to address the issues. They were not listening when people raised genuine concerns, and so we end up with a scheme that lacks public support. In spite of what the member for Lyne just said, the public do not understand it. The government have not attempted to explain it to the Australian people. If any scientist or economist had different views to those associated with the gospel on climate change, they were simply excluded from the process, ridiculed and not treated with any respect.

The government spent taxpayers' money on television advertisements, and now on a 20-page booklet, about the carbon tax. There are actually only three pages out of that 20 that even talk about the carbon tax. The rest are about taxation changes, many of which are not relevant to the purpose of the carbon tax, which is supposed to be to reduce CO2emissions.

The starting price of $23 per tonne is precisely the level set down by the Greens in January 2010, 13 months before the so-called Multi-Party Climate Change Committee was even established. The concept of a built-in growth mechanism over the fixed period is precisely the mechanism put forward by the Greens in January 2010. The transition to a floating price and full emissions trading by 2015 is a mirror reflection of the transition process favoured by the Greens in January 2010. The quasi-independent body to advise the government on rolling caps for the trading era beginning in 2015 is precisely the format sought by the Greens and by the member for Lyne. The whole Multi-Party Climate Change Committee was also a facade. The agenda had already been laid down by the Greens, and the government was prepared to pay the ransom price just to get the keys to the Lodge.

This legislation is dishonest, counter-productive and deceitful. It will be a massive blow to the Australian economy, which this government has already brought to its knees with its mismanagement and its waste. It will make no difference whatsoever to the Australian climate. It will actually result in increased global emissions, as factories and industries leave Australia and go to countries where there are no rules like ours.

Prices will increase across the board. Treasury has estimated 10 per cent more for electricity and nine per cent more for gas. Car manufacturers estimate an increase of around $400 for the price of a new car—that is, of course, if we are left with a car industry in Australia at all, as manufacturers move to places where you can make your cars without paying this tax. Builders have told us to expect $6,000 more for the price of a new home. Groceries are estimated to go up between three and five per cent. Bus and train fares will rise. From 2014, all road transport costs will rise with the planned reduction in the fuel tax credit. Our export industries, including agriculture, will be hit with the extra cost burden that our competitors simply do not pay. Steelmakers are unable to compete and the government has included in this package of legislation compensation for the steel industry, even though they are saying that the recent closures have got nothing to do with the carbon tax. The reality is that decisions are already being made by Australian industry on the basis that this tax is ahead of them and gives them another good reason to relocate elsewhere. Coalmines with high levels of methane emissions will close. The cost of building roads will go up by an estimated five per cent, meaning that we will have less money available for the vital infrastructure we need across the country. Even taking a load of rubbish to the dump will cost more because the operators of the land fill will be responsible for methane emissions. It just goes on and on. All this is supposed to be something that Australia is going to do by itself to save the planet—to save the polar bear, the Great Barrier Reef and the Murray Darling Basin. Australia, accounting for 1.4 per cent of the total global emissions, is somehow or other going to change the climate of the world on our own. Even Professor Flannery says that is rubbish and that it will take a thousand years to make the slightest difference to our temperature, and no difference at all if, in fact, the rest of the world does not follow the nonsense in the direction that Australia is following.

We were told we had to do this so that we could catch up with the rest of the world, but in practice there is no other country that is proposing a tax of this nature. There is no carbon scheme anywhere in the world that comes close to what is happening here. The Americans are walking away from a cap-and-trade scheme and the Chicago Carbon Exchange has actually closed. They talk about reductions in China, but in the time that we will reduce our emissions—our very small emissions by global standards—by five per cent the biggest emitter in the world, China, is going to increase theirs by 496 per cent! What we are doing is complete nonsense.

Also in relation to what China is supposed to be doing—closing down coal-fired power stations—for every one gigawatt they close down they are opening up 10 gigawatts of new. We have to close 90 per cent of our power stations in Australia but we are going to double our coal exports so that other people will in fact use our coal to achieve the same objective. This is the biggest carbon tax in the world, and the government has no mandate to deliver it—no authority; they have lost their legitimacy. It will do nothing for the environment, and this legislation should be rejected. (Time expired)

Laura Smyth (La Trobe, Australian Labor Party) Share this | Link to this | Hansard source

It is always a privilege to be in this place and to stand here as a member of a Labor government, but never more so than on days like today when I know that my voice and my vote will make a very real difference in a significant national debate and a very real difference in relation to a global threat.

I knew on coming into this place that this government was not going to shy away from these sorts of big debates—debates that had been left aside by our predecessors. These are big debates that, then and now, they have neither the capacity nor the moral courage to address. We all recall that John Howard aspired to a relaxed and comfortable Australia, but in reality what he and his party aspired to then and now was stagnation—a kind of policy stupor that left to one side issues critical to our nation and to our globe. This included the increasingly urgent question of climate change.

When the Howard government finally began to see climate change as possibly an important issue it was in the way that a rabbit might see the headlights of an oncoming truck. But at least I can credit John Howard with recognising that it is a critical issue on which action is required. At least I credit him with respecting the science and some of the economics of the issue. These certainly are not attributes shared by his successors, and certainly not by those on the other side who have very recently contributed to this debate. I have to say that it will be to their great shame when our country inevitably reflects on this debate in the future.

Indeed, we have seen so many members of the former Howard government who originally said that they supported pricing carbon now change their minds to score cheap political points. For instance, one of the last speakers, the member for Goldstein, said on ABC on 27 July 2009:

We are very supportive of a price on carbon. We introduced the scheme to do that.

He went on to say:

… we are serious about good policy in this area. We are serious about a price of carbon.

What a difference a couple of years makes in this debate, so serious is he now about pricing carbon that he is in fact debating on the opposite side of it.

On so many issues Labor has shown that ours is the only party that has both a vision for the future of this country and the tenacity to manage the transition to make that vision a reality. To make ideals and vision a workable reality for all Australians requires that we work with people right across our community. On this issue that has meant dialogue and cooperation with expert scientists and economists, industry, community organisations, farmers and others to achieve a realistic nationwide change.

The bills before us today will make Labor's vision for a clean energy future a reality for every Australian and will contribute to the very real global action against climate change. On that note I might correct some of the views that were put by the most recent speakers from the opposition in this debate, who seem to have missed quite a few fairly significant international events around the issue of carbon pricing and climate change.

For instance, the member for Goldstein remarked that we were 'further away than ever from a new international agreement'. He might be advised that, in Cancun in December 2010, some 89 countries representing 80 per cent of global emissions pledged to take action on climate change. That is hardly evidence of a lack of action, as the opposition increasingly likes to claim. Scores of countries have already started the transformation to a low-pollution economy: 32 countries and a number of US states already have emissions trading schemes. Indeed, Australia's top five trading partners—China, Japan, the US, Korea and India amongst others—have implemented or are piloting emissions trading schemes, carbon taxes and coal taxes at a national, state or city level. We know that New Zealand introduced a trading scheme in 2008, initially covering only forestry, but which in 2010 was expanded significantly to cover the liquid fossil fuels, stationary energy and industrial processes.

We know that China has indicated that it will introduce emissions trading pilot schemes across a number of provinces, including the industrial centres of Beijing, Shanghai and Guangdong. The World Bank has recently indicated that these regional schemes may be expanded to a national scheme by 2015.

So far, from the remarks of the member for Goldstein, the leader of the Nationals and others on the opposition benches asserting that there is seemingly no international action on these matters, it seems that at least the top five of Australia's trading partners are taking meaningful action on climate change and the issue of carbon pollution. Indeed, some 89 countries around the world have pledged their commitment to take meaningful action on climate change.

If we are to meet a target of a five per cent reduction on year 2000 levels by 2020 and an 80 per cent reduction by 2050 we are not going to do it with a piecemeal approach. The problem that we face in climate change calls for concerted, nationwide action and a change in attitudes and behaviour, and these are the attitudes of whole industries, communities and regions. A price on carbon is the way to ensure that fundamental and permanent economic and behavioural changes are made. The coalition has put forward its so-called direct action plan, and we already know that it will rely on $1,300 from every household in every year in order to be implemented. We know that it is not intended to, and will not, change the actions of big polluters. We know that the coalition is not serious about the abatement mechanisms in their policy, because otherwise they would have supported the government's efforts to incentivise farmers and other landholders through the Carbon Farming Initiative to really put an emphasis on abatement mechanisms. When it came time to support real abatement activity, the opposition shirked that responsibility. So essentially we know that the direct action plan will be expensive, poorly targeted and amateurish.

But then there is the important question that has been raised even by members of the opposition themselves: the question about whether the direct action policy would ever be implemented at all or whether it might just be ditched. I believe I am speaking a little earlier in this debate than had been anticipated, because we have had a notable person remove himself from the debate today—namely, the member for Wentworth. I presume that he is revisiting his position in relation to the carbon price as we speak. We heard the member for Wentworth as recently as last year saying in very strong terms that direct action policies on climate change were a 'recipe for fiscal recklessness'. Specifically, he had this to say this year:

… a direct action policy where the Government—where industry was able to freely pollute, if you like, and the Government was just spending more and more taxpayers' money to offset it, that would become a very expensive charge on the budget …

The member for Wentworth is right: it would become a very expensive charge on the budget—an $11 billion charge on the budget, requiring hundreds of public servants to deal with the administration of the plan—and it is still not clear how it might have meaningful carbon abatement effects. So, despite the Leader of the Opposition regularly and loudly pretending that this plan will materialise out of thin air, it is in fact going to be a burden that every taxpayer would share as individuals.

We have also heard a few members of the coalition say that direct action policies are easy to stop if you do not believe in preventing climate change. Indeed, we have heard the member for Wentworth again on this issue, but we have also heard the member for Goldstein say to a forum in Sydney on 19 July this year that their direct action policy could 'be easily adapted'. When the coalition talk about their policies being 'flexible' and 'adaptable', what they mean is that they can be dumped or watered down so much that they will be next to useless.

The final point to make about the rather unfortunate direct action plan is about that little paragraph on page 14 of the document. It reads:

Businesses that undertake activity with an emissions level above their "business as usual" levels will incur a financial penalty. The value of penalties will be on a sliding scale at levels commensurate with the size of the business and the extent to which they exceed their "business as usual" levels.

That is an extraordinary 50 words to avoid using the one word 'tax'. Their own policy includes a tax. We heard the seemingly endless rhetoric of the Leader of the Opposition this morning about the terrible circumstances of legislation imposing taxes, and after all that, buried in the fine print of their very own policy, is a new tax.

Apart from the environmental case for taking economy-wide action on climate change, there is an extremely compelling economic case to make the transition to a clean energy future. A carbon price will generate structural change in our economy by giving industry a reason to adjust, to innovate and to develop low-emissions-intensity products and services. By doing so, it will allow us to break the nexus that currently exists between economic growth and growth in carbon pollution so that our continued prosperity does not rely on the degradation of our environment. Climate change presents consequences for all aspects of our nation's life, from infrastructure to planning to population health to industry to agriculture. For that reason it requires a policy response which generates long-term structural change while maintaining our nation's prosperity.

In fact, Treasury modelling projects real national income per person growing strongly under a carbon price. With a carbon price in place, Treasury estimates that real national income per person would be 16 per cent higher than current levels by 2020. As we have heard in this debate, it also estimates that national employment will increase by 1.6 million jobs by 2020 at the same time as growth in carbon pollution generated in Australia slows. By 2050, it is estimated that a further 4.4 million jobs will have been created—with a carbon price. The modelling goes on to predict a very significant increase in the demand for low-emission goods and production processes once a carbon price is implemented. So a carbon price will see stronger growth in industry sectors which produce those products. Critically, Treasury also estimates that by 2050 the renewable energy sector will be 18 times larger than it is today.

Indeed, local businesspeople in and around my electorate have talked to me about the opportunities that a carbon price presents in encouraging people to look at ways they can be more energy efficient. Phillip Revell runs his own small business, Clean Energy Solar. He has talked about the carbon price helping to 'aid the environment for the future generations, for my kids and my grandkids'. He considers that the Household Assistance Package provides families with the opportunity to make very different choices about the energy they use and the energy efficiency measures that are available to them. Rod Capuano of SolarMyHome, in my electorate, has expressed to me his disappointment that the debate around the carbon price has been so negative.

A carbon price with an emissions trading scheme to follow after three years will give business the certainty needed to invest in infrastructure and innovation. A short fixed-price period will give businesses the price certainty that they need and will provide them with time to adapt and prepare for the fully market based mechanism which will apply from July 2015. Of course, we have heard a number of prominent businesses and businesspeople say that a market mechanism will give investors that certainty: people like Paul Drum of CPA Australia; Gail Kelly of Westpac; David Atkin of Cbus; and Nathan Fabian of the Investor Group on Climate Change, which includes AMP, BT and Colonial and represents funds managers controlling more than half of the superannuation money invested in Australia.

We should not consider the task of making the transition to be something that is beyond us. Our economy is capable of this change. Our industries are capable of this change. We must also consider what a failure to take economy-wide action on carbon would mean for our international trade relationships. We know that global actions to mitigate the effects of climate change are already significant. Already, as I have said, 32 countries have carbon trading schemes. It is reasonable to expect that countries which do take action to curb their carbon emissions will regard high-emissions-generating countries as having an unfair advantage and will seek to impose penalties. Australia should not be exposed to that risk, particularly when we have available to us such a range of renewable energy sources and the capacity to innovate to reduce our emissions levels.

Countries such as China, Japan, the US, Korea and India are taking action. The US is committed to achieving its target to reduce emissions by 17 per cent by 2020 based on 2005 levels. The US EPA is regulating large stationary sources of carbon pollution to reduce emissions and incentivise the uptake of clean-energy technologies, and is increasing fuel-efficiency standards for cars and light trucks. President Obama has committed to establishing a clean-energy standards to double the share of clean energy in the electricity supply mix from 40 per cent to 80 per cent by 2035. I am sure that he can embellish on the actions being taken by his government and various states within the US when he visits here in November.

There is a range of state and regional trading schemes operating or under development including in California, the world's eighth largest economy. Meaningful international action is being taken and Australia certainly should not be left behind in circumstances where it is so capable of responding to the challenges of climate change by innovating and developing industries which are no longer so heavily reliant on highly-polluting technologies and services.

We have a small window of opportunity to act on a growing global risk. The longer we delay meaningful action, the more it will cost to remedy the effects of climate change environmentally and economically and the worse the impacts will be. Whatever others might like to believe, no amount of denial or rage or posturing is going to change that reality. Australia must put a price on carbon.

Peter Dutton (Dickson, Liberal Party, Shadow Minister for Health and Ageing) Share this | Link to this | Hansard source

In households and businesses across my electorate, people are unsettled for the first time in a generation. People are nervous about the direction of the country. Workers are seeing their mates laid off or their own hours of work cut back. Whilst their disposable income declines, their costs of living are rising rapidly. In suburbs like Eatons Hill, Cashmere, Kallangur, Everton Hills, Strathpine, Samford, Petrie and Albany Creek, families are seeing their home values depressed and their interest rates going up. Many families are falling behind in their repayments, and we are seeing an unprecedented number of forced home sales.

Retirees like those who go to the Strathpine Senior Citizens or who live at Inverpine or Farrington Grove, or the many travelling to faraway places with a caravan hitched to the back of their four-wheel-drive, are all finding it harder to make ends meet. Self-funded retirees or those on defined incomes, like many living at Aveo at Albany Creek, look at their electricity bills and grocery bills going up and up and up whilst watching their super balance or investment portfolio going down and down and down. Small businesses are the backbone of this country, and many through areas like Brendale, Arana Hills, Dakabin and all over Dickson are hurting to a point where they are just plain angry or at breaking point because they know that at the end of the day it is their homes on the line.

If this angst were isolated to one state or community across the country, that would be bad enough; but the story of the many people in Dickson is the story of many across the country, including in the great state of Western Australia, currently undergoing a mining boom. It is in this context that the government introduces this new tax. It is absolutely central to the coalition's decision to oppose the imposition of another tax with negligible environmental benefit. This is an emotive debate and most views are fiercely held, both in this place and in the Australian community. Like any debate, views have changed and matured as people have taken a greater interest and as new evidence has come to light. It is a debate which to date has contributed largely to the downfall of one Prime Minister and it threatens to destroy a second Prime Minister—and in many ways the debate has only just begun.

As first principle, I am opposed to the introduction of any new tax. Our job is to make life easier for Australians, not harder, and this tax makes life harder at a time when families and employers cannot afford it. It will have no impact on global emissions. My job as an elected representative is to be part of a government that grows jobs and rewards people for their hard work. My job is to provide support to those who because of illness cannot work. My job is to support those in retirement, those who have laboured for a lifetime of hard work and deserve a dignified and enjoyable stage of life. These are the reasons I am implacably opposed to this tax, a tax which is an attack on jobs, on reward for effort, on those who cannot work and on those who want to enjoy their lives after a lifetime of work.

Surely no Australian government willingly imposes harm on its people, but the motivation for this bad policy needs to be understood. The government want the public to believe that this is a tax about the environment. They want the public to believe that this is a reformist piece of economic advancement designed to set us up to be ahead of the rest of the world. Overblown rhetoric has been central to Labor's term in government—first Mr Rudd and now Ms Gillard promising historical reforms and landmark agreements, all of which have turned to dust. This debate is no different. Setting our industries up with an impost not imposed on international competitors and disadvantaging households through the imposition of a new tax is not about historical reform; it is about taking money from one group of Australians and transferring it to others. It is about setting up a government desperate for cash with new future revenue streams.

It is right that we protect our environment. No Australian would argue we should not take reasonable measures to protect our environment and, where we can, the environment elsewhere. Millions of Australians recycle each week and live sustainable lives. They contribute to the rehabilitation and the protection of our environment. As Minister for Workforce Participation in the Howard government, I visited countless Green Corps and Work for the Dole projects around the country and saw the great work undertaken by younger and older Australians alike to make our environment more sustainable. It was the Howard government that invested billions of dollars in environmental projects and helped to develop a generational shift in our approach to the environment. In suburbs like Mount Nebo, Whiteside, Dayboro, Ferny Hills, Laceys Creek and Mount Glorious—in fact, right across my electorate—residents are leading more sustainable lives. They are doing so without the imposition of a great big new tax. People who have spent their own money to install insulation or solar panels, switch to gas, purchase a diesel vehicle or grow their own produce will face this tax regardless. Companies big and small are actively reducing their emissions, and even in the government's own television advertisements businesses have spoken about their efforts to reduce emissions by 20 or 30 per cent without the impost of any tax. Why will these people and businesses be punished by this economy-wide tax?

This carbon tax is the only economy-wide tax in the world. Big emitting countries like the United States and China have a piecemeal approach. The important point here is there is no prospect of an economy-wide tax in India, the US, China or any other major emitter around the world. There is certainly no prospect of the impost of a tax of this nature being applied by governments of our major trading partners on their industries. We are a country of 22 million people and, despite all of our natural resources and the demand for them, we are not a superpower. We are a trade-exposed nation competing with the likes of Brazil and parts of Africa. We are a country whose economy is dependent on many of the resources in the ground. Where we once rode on the sheep's back, it is the miner who now feels the strain.

If we were to close down the coal industry, as demanded by Labor's coalition partners, the Greens, our economy would go into recession. We should adopt world's best practice in terms of extraction, and we do. Even if we were to close down the mining sector, no-one should be tricked into believing world production would fall away. Fast developing nations like China and India, the current customers for our resources who have the responsibility of lifting millions from poverty, will not drop their demand. They will just seek the product elsewhere. They will seek it in markets where extraction methods are not as environmentally responsible as they are in our own country. So our workers, our industry and our environment will be the losers out of this move.

This tax is not restricted to the mining industry. In the worst of all possible outcomes this tax will be applied, directly or indirectly, to every level of production and energy use in our economy. This is a cascading tax, and it will infiltrate in a way which will be difficult to quantify for the end user. It does not have the nature of a GST. That is part of the reason the Labor Party has not been able to bring the Australian people with them. Firstly, people accept that they are going to be harmed by this tax, and the government has offered compensation. Australians do not believe that the compensation offered up will be sufficient or long lasting. They know business will not absorb the impact of this tax because business cannot. Like any other input, it will be passed on to the end consumer.

Secondly, people do not understand, even if they are the strongest believers in climate change, why our country would move ahead of the rest of the world. This penny has dropped for millions of Australians, particularly when there is not a glimmer of hope for global consensus. People are asking: 'Why would our federal government disadvantage local small businesses like butchers, who are big users of electricity? Why would this Labor government make it more expensive to build a home in Australia where there is no environmental benefit? Why would the Labor government increase costs to local councils and see our rates increase when there is no environmental benefit? Why would the Labor government dramatically increase the running costs of Australia's public and private hospitals when there is no environmental benefit? Why would the Labor government dramatically increase the cost that it takes to operate a medical surgery or a pharmacy when there is no environmental benefit?'

I want to give one example of a small business in my own electorate that will see a direct impact. Sadly, the impact will be passed on to scores of families who live locally. I want to quote from an article in the Pine Rivers Press of 12 July 2011, which talks about a visit Joe Hockey and I made to a local business called Medical Design Innovations. It operates in Brendale and its managing director is Sergio Esteves. I will quote from the article:

The Federal Government's carbon tax announcement on the weekend has Brendale business owner Sergio Esteves fearing his company will have to move overseas.

Medical Design Innovations is the last medical equipment manufacturer based in Australia but Mr Esteves said with high increases in electricity and aluminium, he may have to join his competitors in China, leaving his 24 employees without a job. "In order to stay competitive, I have no option," Mr Esteves said. "We survived the global financial crisis but it put us right on the edge of the cliff.

"This extra little push from the Federal Government and I will be down and out."

The family-owned business has been operating in the local area since 1998 and has a strong environmental policy in place, using recycled cardboard boxes and recycling every piece of scrap metal, but Mr Esteves admitted those efforts would not be enough to save him from the Federal Government's carbon tax.

The article goes on to say:

Shadow Treasurer Joe Hockey, who visited the business alongside Federal Member for Dickson Peter Dutton on Monday, said small businesses like Mr Esteves's were the ones who were going to be affected by the tax.

"This carbon tax is going to hurt people, it is going to hurt small businesses and it is going to hurt the Australian economy," Mr Hockey said.

Strathpine-based Senator Mark Furner said the tax was aimed at high-polluting companies including "high-intensive trade sectors like aluminium."

"The Government made a commitment that small businesses would not pay a carbon price," he said.

Mr Esteves said about 80 per cent of raw material used by his company was aluminium.

So the problem for this small business and for scores of other small businesses across my electorate is that they cannot reconcile the two comments coming from government. The government says that there will be a tax imposed on the top 500 emitters and that that is where the tax will stop. But, of course, companies like this that have big inputs of energy-intensive production methods or raw materials like aluminium will face increased costs. So how can this company, which competes with companies in China and other parts of the world that do not have the impost of this new tax, play on a fair field? That is the problem that most people see in this tax as it is proposed by this Labor government. This is a complicated debate, but it must be distilled down to what is in the best interests of our country. The government have been unable to convince the Australian people that this tax is good for our country or that it will be effective in reducing global emissions. Perhaps central to the government's inability to convince the Australian public that they can get this tax right is their track record over the last four years.

Very briefly, I want to take the Australian public back over the last four years. This is a government whose programs, regardless of what program they have tried to roll out, have turned out to be a disaster. It did not just commence under this Prime Minister; it commenced, of course, under Prime Minister Rudd. There were promises about taking over hospitals if they were not fixed by mid-2009. There were promises about installing pink batts. There were promises about implementing school halls and giving money away. There were promises about Fuelwatch and GroceryWatch, and border protection. But this is a government that, regardless of whether its leader is Mr Rudd or Ms Gillard, has not been able to produce the sorts of outcomes that the Australian people expected at the 2007 or 2010 election. If the government is not hearing the message from the Australian public, it will be at its own peril.

Australians are lacking confidence, and it is not because the fundamentals of our economy are not strong and it is not because our people do not work hard or because we lack natural advantage in Australia. It is because they look to the leadership of this country and find it difficult to draw confidence from the daily disasters and poor policy processes that have dogged this administration since its election four years ago. People look at how hard they themselves work, at the taxes they pay, and how hard it is to make ends meet, and then they see yet another Labor government guilty of waste and mismanagement.

This tax should be voted down; and, if it is not voted down, we will seek a mandate from the Australian people at the upcoming federal election to make sure that, at the first available opportunity, we remove this impost from Australian families and businesses, who are struggling like they have not struggled in a generation. We will be a government that will restore confidence to families and businesses, and we will get this country back on track. (Time expired)

Mike Kelly (Eden-Monaro, Australian Labor Party, Parliamentary Secretary for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

What a tremendous privilege it is to be here today to speak on the clean energy legislation in this endgame—one last opportunity to reach out to the members opposite and ask them to participate in the greatest challenge this nation faces. How poignant and how true were the words of the Prime Minister when she said that this was where 'the judgment of history' will begin. The names will be recorded in this vote. The names will be recorded. At this time, I think of one great historical figure, a hero of mine, Franklin Delano Roosevelt, whose famous words have echoed down the generations:

… there is nothing to fear but fear itself …

Then I think of the Leader of the Opposition, whose line is 'fear everything' and 'I am fear itself', and I ask myself: who is it that will be remembered in history? Whose legacy will be appreciated by subsequent generations? I am so proud to stand with my brothers and sisters on this side of the chamber and I say: go tell the Spartans that there were 103 men and women on this side who stood shoulder to shoulder, with courage and commitment, in the face of political risk to deliver this legislation for the future of our country and our kids. But I believe that today the bell will start tolling not for us but for the Leader of the Opposition. Every day from now until the 2013 election, we will see the clock ticking on the final political demise of the Leader of the Opposition as he is exposed systematically as a fraud.

There are some things I have heard in the chamber today that need addressing, such as the comments by the member for Goldstein. Who could believe that he could stand there and say that this is a 'socialistic' measure as opposed to the coalition's 'inaction plan'! Their plan is a command economy approach, which is a back the winners, make the taxpayers pay approach—$1,300 added to the taxpayer's annual bill through their plan. There is the ludicrous tree-planting scheme: they would have to plant 28 million hectares of Australia to get to where they need to be—the 'tree in every lounge room' plan. How ludicrous an approach, when all those great socialist figures around the world, like Nicolas Sarkozy, Angela Merkel, David Cameron, Arnold Schwarzenegger and, of course, John Key have all said, 'No, let's go with a market based approach'! Well, where are our free marketeers? Where are you at this time to stand up for the strengths of a market approach that everybody says is the most efficient, productive way to tackle this challenge? The OECD, the Productivity Commission, Shergold, Garnaut—all of them are lining up to say, 'This is the way to do it.' I know that at least half of the members over that side would give their eyeteeth to line up behind this legislation. I know that the member for Wentworth is out there chewing over this right now, chewing over his conscience—a man who has stood his ground previously, a man who is concerned about his legacy now and knows what the risks are.

When I travel around my electorate—and I have done eight forums on this issue now—we do not talk about the debate on climate science. We talk about why this legislation is a good reform measure from the point of view of dealing with the cost-of-living challenges for our low- and middle-income earners, dealing with tax reform and, yes, dealing with creating the new economy that this country needs to meet its energy generation challenges and also to take advantage of the opportunities of the new economy. During the dark Howard years, when this country slipped backwards in this space, we saw a shameful brain drain, with the people who developed expertise in this area disappearing to the United States and China. Now, with these measures, we have the wherewithal—through the Clean Energy Finance Corporation with its $10 billion, the clean energy technology aspect of the scheme with its $1.2 billion—to generate innovation and get behind the research, development and exploitation that have so often been missing in creating a more diverse economy than we have at this point.

We talk about the exposure of this economy to the two-speed or patchwork problems of the mining boom. Well, this is one of the ways that we can get around that problem, because these are the technologies, this is the innovation, that the world is hungry for. Why would we deny our young people the career opportunities here in Australia? Why would we not exploit that hunger for the benefit of the planet?

We know that there has been a lot of distortion of the facts and figures here, but the modelling has demonstrated that there will be 1.6 million new jobs. In my own region, in Eden-Monaro, we know there will be 2,300 new jobs. The Frontier Economics survey that the New South Wales government distorted proves that south-east New South Wales is going to be in the top four areas of this country to benefit from this scheme. We know that the regional and rural areas of this country will be the ones to benefit. That is why it is so shameful to see the Leader of the Nationals stand up here and argue against this, as he argued against the Carbon Farming Initiative, an initiative supported by the National Farmers Federation that the farmers in my electorate are reaching out for. When Ross Garnaut came to Cooma the other day, 300 farmers turned out. My Monaro Farming Systems people and my Bega Cheese farmers are all hungry to take advantage of this scheme, which will allow them to diversify their income and achieve productivity benefits. They were already going down the road of some of these sequestration and other techniques and now they will be able to make an income out of that as well. But, no, the Leader of the Nationals would deny them that opportunity. Where is his concern for rural and regional Australia when we know that groups like the Investor Group on Climate Change Australia/New Zealand have $600 billion worth of investment dollars waiting to be unleashed? Most of that money is going to land in rural and regional Australia. But, no, the Leader of the Nationals would deny us that opportunity.

The most shameful aspect of this is the deception, the distortion and the denial that we have seen demonstrated by the coalition. You do not have to take my word for it because there are a good serious journalists out there who are recording this and zeroing in on the Leader of the Opposition. For example, Ross Gittins, in the Sydney Morning Herald, back in May, wrote:

I don't like using the L-word, but Tony Abbott is setting new lows in the lightness with which he plays with the truth. He blatantly works both sides of the street, nodding happily in the company of climate-change deniers, but in more intellectually respectable company professing belief in human-caused global warming, his commitment to reducing carbon emissions by 5 per cent by 2020 and the efficacy of his no-offence policies to achieve it.

He grossly exaggerates the costs involved in a carbon tax, telling business audiences they will have to pay the lot and be destroyed by it, while telling the punters business will pass all the costs on to them. He forgets to mention that most of the proceeds from the tax will be returned as compensation.

He repeats the half-truth that nothing we could do by ourselves would reduce global emissions, while failing to correct the punters' ignorant belief that Australia is the only country contemplating action.

We have had many members in this chamber point out what action is going on around the world at the moment—in China, in Korea, in Japan, in California. We have had Linda Adams from California here this week, the eighth largest economy in the world. They will link their scheme to Europe. New Zealand will link with us and to a scheme in Asia which we can link to Europe and eventually to China, who will introduce a scheme by 2015 along with us.

We have also seen some more reporting recently. A headline in the Sydney Morning Herald on 13 September read 'Coalition distorts facts in campaign on pollution charge'. Their materials that have been released, their lines in fighting this, contain so many distortions and lies that it is hard to count them up. One in particular that has been exposed is the claim that $3.5 billion a year in taxpayers' dollars will go to overseas trading systems. That Labor proposes to allow polluting businesses to buy permits overseas is true, but of course that will be at the expense of those who purchase those permits and not taxpayers. So, once again, the coalition are exposed as frauds in that claim.

Today the Australian Financial Review reports 'Abbott's three degrees of dumbness'. It talks about his mistake in dealing with this debate yesterday—the new lows to which he is taking not only this country but this chamber in this debate and the decorum he shows in this chamber when it deals with serious issues. He was exposed not only as a fraud but also as someone who demeans this institution. Geoff Kitney said:

Yesterday he overstepped. The empty benches looked like a prank than a protest, a piece of childishness which sent the wrong signal about the coalition's attitude to the Parliament and the climate change issue.

But, unfortunately, he is not alone in his deceptions. He has been joined in his crusade against action on climate change by the Premier of New South Wales, Mr Barry O'Farrell, who blatantly went out there and distorted the Frontier Economics study the New South Wales government produced. He was called on it by Professor John Quiggin, who this year won the Distinguished Fellow Award from the Economic Society of Australia at the University of Queensland. He said:

The New South Wales government has cherry-picked all the scariest possible numbers in a way that is totally misleading and absolutely dishonest.

That is the way Mr O'Farrell is approaching it. Professor Quiggin also had an article in the Sydney Morning Herald where he went on to elaborate on that, saying:

… Frontier Economics, who say they used the same model as the Commonwealth, with almost identical inputs. As a result Frontier concludes, "At an aggregate level, the modelling results in this report are broadly consistent with the Commonwealth Treasury modelling."

How can this be? The answer is that the NSW government engaged in an exercise in misleading advertising that would make even the most shonky of infomercial vendors blush.

…      …   …

The most common dishonest use is to report only the bad news about industries that will grow more slowly, and ignore the good news … As the Herald's Matt Wade reported on Saturday, the Frontier modelling exercise forecast benefits for industries including financial services and communications in which Sydney is particularly strong …

The reality is that the carbon price is a modest reform, about one quarter the size of the GST. Except for directly affected sectors such as electricity generation, the impact will be undetectable against a background of substantial volatility around a long-run growth trend. This was forcefully illustrated by the news that Bluescope Steel is to shed … jobs, casualties of the high Australian dollar.

Now with our industry assistance package there, they of course welcome our measures. That is John Quiggin.

Today I noticed under the story above where it talks about the 'Liberals shy off costing pledge', which was another shameful exercise in obfuscation in this chamber, an article by Michaela Whitbourn titled 'How to cook up a carbon tax story', again referring to the distortions by Premier O'Farrell. He was shopping around. His bureaucrats were looking to line up behind Tony Abbott, cherry-pick figures where they could, distort or attempt to manipulate information. The Department of Transport, unfortunately though, had already come to a conclusion which completely contradicted his own. The transport department said that the government carbon tax would have 'no measurable effect' on transport choices and would increase prices by less than one per cent. But, in the face of that advice and in distortion of the true situation of that advice he received, he stated that the tax would 'increase passenger fares by up to 3.6 per cent'—a blatant misrepresentation and total dishonesty on the part of the Premier of New South Wales. So we have a clear trend here and a clear record of the coalition and their state allies lining up to try to deceive the people of this country. That decision will be revealed—

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

Order! It being 1.45 pm, the debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour and the honourable member will have an opportunity to continue his contribution.