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

Before concluding the contribution I began earlier today in this debate on the Clean Energy Future package of bills, can I say that some of the submissions we heard from what I would call the 'flat earth society' in the matter of public importance debate put me in mind of the old Army expression 'Lead, follow or get out of the way.' What we know is that during those 12 Howard years when the chance was there for leadership nothing was done in this space. In fact, shamefully, our renewable energy capacity in this country went backwards during those 12 years, from 10 per cent to nine per cent. So that 12 years of opportunity was lost, no ratification of Kyoto, complete abrogation of responsibility.

Then this government came into power in 2007 and the very first act that Kevin Rudd did as Prime Minister was to ratify Kyoto. Before the rest of us had even been sworn into our portfolios that ink was drying. It was a fantastic step forward. So the opportunity was there then for the opposition to follow and, I must give them credit, there was a time when they did. There was a time when Malcolm Turnbull and Ian Macfarlane lined up and engaged constructively with the government to move this ball forward. Then, of course, came the coup, a coup driven by the desire of the Leader of the Opposition based purely on politics and his ambitions to become Prime Minister, so that opportunity to follow was lost.

Now here we are in this parliament where there is an opportunity for this opposition to just get out of the way. Effectively they have made themselves irrelevant in this debate. They have absconded from the field when we had an opportunity to engage through the Multi-Party Climate Change Committee and they did not engage. I ask for the opposition to just get out of the way now that they have made themselves irrelevant. Go home over this weekend, have a look at your children and your grandchildren and think about their future and think about how you want to be remembered. What will be your legacy and where will your name be in relation to this vote when this debate is done? (Time expired)

Scott Morrison (Cook, Liberal Party, Shadow Minister for Immigration and Citizenship) Share this | Link to this | Hansard source

I rise to speak today in defence of Australian jobs, Australian families and Australian small businesses—especially those jobs, families and businesses in the Sutherland shire of my electorate of Cook. The Leader of the Opposition astutely concluded his remarks today by describing these clean energy bills as one of the longest political suicide notes by a government in our history. There is a reason for his observation. The government have spoken about the judgment of history. That judgment will not be kind to this government. But what they do not want to do is enable these bills to be judged by the Australian people, and they have sought to thwart and deny that judgment at every opportunity.

The Prime Minister and this government misled the Australian people before the last election. The Prime Minister declared there would be no carbon tax under the government she leads. Having broken this pledge, forming her government on her deceit, she has compounded the insult by vilifying those who now seek to hold her to account. That is not just those in the opposition; it is the millions of Australians across the country she and her colleagues have demonised as an ignorant mob. Her ministers have arrogantly claimed in this place that those who sought to oppose this government were of no consequence.

This government will ultimately have to keep a date with the Australian people when they will be judged for their deceit, their incompetence, their arrogance and their hypocrisy. For most Australians, that day cannot come soon enough. The solution most Australians want, whether it is on the carbon tax, illegal boat arrivals, reckless spending or Labor's simple inability to get anything right, is an election solution.

The impact of this carbon tax will be far reaching. It will tax everything that moves and breathes. However, if they believe these measures will cool the globe—while mortgaging Australia's future in the process—they are simply dreaming. As Senator Joyce has remarked:

… if taxes cooled the planet, the place would already be an icebox.

Lincoln said:

No man is good enough to govern another man without that other's consent.

His singular reference to gender was not intended to exclude our Prime Minister from this wisdom. This tax is more than a broken promise. It is another fundamental betrayal of trust by a government that simply cannot be trusted.

The majority of shire families will be worse off under Labor's carbon tax. On the government's own figures, those who will be greatest hit in the shire will be Labor's forgotten families, especially those where one parent stays at home to care for their children. They are the biggest losers under this government's bad tax. The government's own figures show that single-income families earning $65,000 or more, with one child, will be worse off. For single-income families with two children, the pain begins at $80,000. For two-income families, the pain begins at $105,000 per household. The average income of a person in such a family is less than the average annual national earnings for a person—less than $10,000 than those same average earnings annually for a person in New South Wales, let alone Sydney, where the cost of living is one of the highest in the world today. These impacts will be felt more severely in Sydney than anywhere else because of our already high costs of living.

Neither the Prime Minister, the Treasurer, the Minister for Finance and Deregulation, the Assistant Treasurer nor even the minister at the table, the Minister for Climate Change and Energy Efficiency, understand the daily life and costs of living that Sydneysiders must already bear. We are struggling with rising rents, rising electricity prices and increased costs of living across the board. This is a government that is completely oblivious to the challenges faced by Sydneysiders on a daily basis, and this tax is a prime example of the way that this government simply does not get it in terms of what is happening in Sydney—whether it is in the plains of Western Sydney, the Blue Mountains or the Sutherland shire in my own electorate of Cook. In the shire, the 2006 census revealed that the median household income for families with children was between $104,000 and $130,000 a year. Five years on, average weekly earnings have leapt by 20 per cent. This means the majority of shire families will be beyond the reach of Labor's compensation package.

But it is not only families who stand to be hurt by this tax. A constituent recently, last month, wrote to me and stated:

Single people get absolutely no tax breaks or benefits. Yet our incomes are chipped away through ordinary tax increases, carbon taxes, flood and Medicare levies and insurance premium increases. I feel that single people are being discriminated against in all of these government decisions.

The carbon tax comes on top of yet another broken Labor promise—their budget assault on more than 100,000 Cook residents covered by private health insurance, with Labor's plan to cut access to the private health insurance rebate. The flood tax, costing around $250, kicked in this financial year. From 1 July, residents of New South Wales are already facing an average 17 per cent leap in the price of power before this government introduces its carbon tax. This tax will increase also electricity prices by a further 10 per cent in the first year under the carbon tax, which will also see gas prices go up by nine per cent, on their own figures. This toxic tax will also cost local businesses and threaten jobs.

In my electorate there are around 400 manufacturing businesses that employ one or more people. One of those businesses is shire engineering and tool-making business C A Rich Patternmakers and Toolmakers in Taren Point, run by Stephen Rich. Stephen's father, Charles, started this business in the 1950s with his wife, Gwendolin, who did the books for many years as well as raising their family. They are like so many other entrepreneurial small business people who set up businesses in the shire at that time. These businesses have driven generations of prosperity and opportunity for themselves, their employees and our shire. Their business is more than just a job; it is their passion, their obsession and their legacy. This carbon tax will put at risk generations of hard work by these families to create a viable business and generate local employment. These family businesses have already had to weather the tough financial climate and fight increasing competition from overseas. The last thing they need in the shire and elsewhere in this country is a carbon tax to add to the pressures they face.

Like so many engineering and light manufacturing businesses, C A Rich are carbon rich in their production. This carbon tax will hit almost everything that moves on their factory floor, whether it is the electricity they need to keep the machines running, the heavy steel, aluminium or other metal material inputs they work with or the transport costs of shifting this around to and from their suppliers and to their clients. They will be hit from every single angle imaginable.

In additional to manufacturing, the carbon tax will also strike our local transport, freight, maritime logistics, aviation, utilities and construction sector. In my electorate, there are around 11½ thousand of these businesses. Manufacturing, transportation, construction and utilities account for more than one-third of the jobs of Cook residents. Thousands of shire residents are employed in these sectors, especially in and around the airport.

I particularly make the point that Caltex, Qantas and Virgin will feature in Labor's list of dangerous big polluters who they say will and should be taxed. The global aviation industry is incredibly competitive and it is not a level playing field. Any impost at all within the group structure of these airlines impedes the ability of these businesses to profit and, as a result, employ—especially locally here in Australia. Qantas estimates the carbon tax will cost it approximately $100 million to $115 million in 2012-13 and Virgin has put the cost to its operations at $45 million—and there is no compensation. Caltex directly employs 500 people at its operation in Kurnell and a further 500 contractors, though contractor numbers can increase significantly during major maintenance programs that occur at the plant. There is no doubt these bills will not assist the ongoing viability of Caltex's operations at Kurnell, which are already vulnerable.

When interviewed on Lateline Business recently, Caltex CEO and MD Julian Segal noted Caltex had already initiated a review of the ongoing role of their refineries, including their operations at Kurnell and, more specifically, the two catalytic crackers. Energy analyst Mark Samter said in the same report that Caltex refineries may now be converted to import terminals. At a time when such marginal decisions are in play, the blindside hit of the carbon tax can only make operations more marginal and potentially tip the balance against local jobs.

But it is not just local families, residents and businesses in the shire who will be hit. I recently attended Civic Disability Services, who for more than 50 years have provided care and a sense of purpose for those with disabilities in the shire. They do a fantastic job and have managed to do it on commercial terms, despite the pressures of an increasingly tough economic climate. Civic Disability Services employ more than 100 people, the vast majority of those with disabilities, doing meaningful work so they can better support themselves. But here is the issue: after paying to employ people with disabilities, their second biggest cost, they told me, is their power bill. The Gillard government's carbon tax means a 10 per cent hike in those bills in the first year alone, and after that the prices will only go up. Civic Disability Services are able to provide meaningful employment and purpose to the lives of people with disabilities in the shire because they can provide a commercial and competitive service to real commercial clients, who expect high standards at an affordable cost. Every time Civic flicks the switch and turns on the lights, let alone powers up a machine on the factory floor, Labor's carbon tax will make the services they provide to their customers, including international contracts, less competitive. Yet Labor is offering no compensation for not-for-profit organisations like Civic for the cost impacts of the carbon tax. There are many other not-for-profit organisations like Civic in the shire, and they will all feel the pinch. Many will be forced to pass the carbon tax costs on to the very people they serve through increased fees, reduced services or simply walking away. These businesses should be encouraged and rewarded for the continued standard of care and commitment to their community, not taxed mindlessly.

Finally, there is the issue of simply how you could trust the Labor government, the most incompetent we have seen, to implement such a massive change—a $9 billion new tax. The government have not been able to deliver any major program without excessive waste, bungling or catastrophe, be it the roof batts, the NBN, the BER or, particularly, my own portfolio area, border protection, where costs have blown out from less than $100 million a year to more than $1 billion a year.

This carbon tax is also an egregious intrusion of big government into our economy and our society. Australians are not whingers, but there comes a point when businesses, families and single people within our community are pushed beyond their limit. There will be repercussions for a government without a mandate trying to ram through this legislation, and it will be fatal for them.

These measures are all pain and no environmental gain. Under this package, our domestic carbon emissions in 2020 will actually be higher than they are now. Two-thirds of the abatement will have to be bought offshore from foreign carbon traders at a cost of $3.5 billion, rising to $57 billion in 2050, or 1½ per cent of GDP—a scheme which the Australian Crime Commission has highlighted will involve $5 billion in fraud.

And we will be out there on our own. The Productivity Commission found that there was no other country seeking to impose an economy wide carbon price. The government seems to have developed complete amnesia about the collapse of the carbon price agenda at Copenhagen. The European ETS raises only about $500 million a year, or $1 per person. Labor's carbon tax in this country will raise $9 billion, or around $400 for every Australian. In the United States, where I visited earlier this year, it was very clear based on my own inquiries with congressional members from both sides of the aisle that a cap-and-trade system is not on the agenda anytime soon, and certainly not before 2020. At least the United States have worked out that a carbon tax or even an ETS in the current economic climate is economic lunacy. In Canada, they have equally made the sensible decision, not just in economic policy but in a democratic sense as well, where the government has listened to the Canadian people and walked away from these policies. While the Labor government cites China as emissions reductions leader, the truth is that its emissions will increase by 500 per cent by 2020.

The coalition have fiercely opposed this tax from day one and we will continue to fight this tax, here and everywhere we can, for Australian jobs, small businesses and families, and particularly my own community and the shire. I particularly want to commend the Leader of the Opposition for being the people's champion on this issue, ably supported by the member for Flinders and my many other colleagues, including the member for Indi, who is at table with me today. The coalition is the only force standing in the way of this toxic tax. We are energised by the support of the Australian people in this endeavour and we will not let them down. If the Prime Minister in her arrogance persists in ignoring the voice of Australians and imposes this odious tax, then let it be on her head. History will indeed judge her and it will not be kind. When the time comes for the Australian people to have the opportunity to act on this issue, an opportunity that this Prime Minister and this government have denied them time and again, their judgment will be absolutely resounding.

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

Modern Australia was built on the efforts on men and women who were willing to make an investment in the future of this great country, men and women who had a vision beyond the present and men and women who thought about the future of this country and what it might look like for their children and beyond. They were led by governments who in the main believed in building a country which was the envy of the world and a place to build our hopes and dreams. The question for this generation of leaders, the people who occupy this place, is whether we have the right to claim the title of heirs to this legacy, whether we have the courage to build and to introduce policies which are in the future national interest and look beyond short-term political opportunism, because this generation does indeed have a challenge.

We know that greenhouse gases are one-third higher than before the Industrial Revolution. We know that global temperatures have risen by 0.7 degrees Celsius over the past century. We know that unabated they will continue to rise. We know that the last decade was the world's hottest on record and we know that globally 2010 was the equal warmest year on record. We know 2010 was the 34th consecutive year with global temperatures above the 20th century average and we know that climate change and global warming are real. We know the consequences are real and we know that we have to change the way that we do things in Australia and around the world if we are to avoid catastrophic changes. We know that if we do not act our children will pay the price.

This government has a realistic plan on how it will respond to this generational challenge. We have a target, which is shared by those on the other side of the chamber, though they sometimes deny that climate change is real. Nonetheless, we have a target which is shared by all in this place of reducing our carbon emissions by five per cent over 2020 levels. On this side of the House, we have a plan to tackle this in the most efficient and effective way. Our plan will put a price on carbon, because we believe this is the most effective way to ensure that we change gradually and do not need to put in place dramatic efforts to reduce our carbon emissions if we leave the situation to continue unabated. We will do this in a way that brings households along with us and looks after those who are in need of assistance. Under our plan nine out of 10 households will receive assistance through either tax cuts or payment increases. Almost six million households will get tax cuts or increases in payments that cover the entire average price of the introduction of carbon pricing. Over four million Australian households will get an additional buffer with the assistance that covers 120 per cent of the average price impact of the carbon price. The net effect of this is that they will have the capacity to adjust the way that they live and the way they use energy and, if they do, they will be able to pocket the difference. If they are unable to make these changes, then they will be no worse off.

This presents us with an enormous opportunity to put in place some significant tax reform. As a result of our increase in the tax threshold, shifting the tax threshold from $6,000 to $18,000, over one million Australians will no longer need to lodge a tax return. On average our package will cost households around $9.90 a week, but they will get $10.10 assistance in return. This assistance will be permanent, and the government will review the adequacy of assistance each year and increase it further as necessary.

It is no secret in this place and elsewhere that I have had a lot to say about the manufacturing industry and in particular the steel industry, as it is so important to my electorate of Throsby, which takes in Port Kembla and the BlueScope steelworks and many other manufacturing businesses. I am very pleased to see that, as a result of advocacy of many members on this side of the House, including me and my colleague from the Illawarra, the member for Cunningham, Sharon Bird, we have been able to see some significant assistance for manufacturing and the steel industry make the necessary transitions. I point to the Jobs and Competiveness program, which is an important part of this package of legislation. It will provide assistance to emissions-intensive and trade-exposed industries with the aim of supporting jobs and businesses make the transition. The way this assistance is provided maintains the incentive for companies to reduce their carbon pollution partly because they will compete with each other and other companies to look for cost-cutting ways to ensure that they do not lose a market edge. The initial rate of assistance will be 94.5 per cent for the most emissions-intensive and trade-exposed industries and 66 per cent for moderate emissions-intensive industries. This will provide significant shielding for many, many industries in my electorate of Throsby.

In addition to providing the free permits and the free assistance for those emissions-intensive industries, two separate funds have been set up to assist businesses in the manufacturing of food and foundries and related industries to make the necessary adjustments to transform their businesses and to implement energy-saving and energy-efficiency measures, technologies and processes. I point to the $200 million Food and Foundries Investment Program, which will provide grants for manufacturers in the food-processing and metal-forging and foundry sectors to invest in energy-efficiency projects and low-emission technologies, processes and products. In addition, an $800 million clean technology investment program will provide grants for those manufacturers in a sector not eligible for other forms of assistance to invest in energy-efficiency projects and low-emissions technologies, processes and products.

Separate from the CEF package of bills, but being debated at the same time, is the Steel Transformation Bill 2011. The steel industry is facing considerable pressure in Australia and right around the world at the moment. Many say it has not yet recovered from the global financial crisis. In Australia we are facing additional pressures due to the high Australian dollar and the high input costs of iron ore and coal. The Steel Transformation Bill provides the legislative framework for the establishment of a steel transformation plan, which provides a $300 million special appropriation to assist the two main steel producers, BlueScope and OneSteel, to introduce mechanisms, innovations and investments to ensure that they reduce their carbon intensity and assist them make the structural transformation necessary to ensure that they still have a viable future in this country. Indeed, the bringing forward of $100 million in this special appropriation was instrumental in assisting BlueScope, which has recently announced a significant restructuring of its operations—including those in Port Kembla in my electorate. This will have a significant impact on the local economy, and I fear that without the bringing forward of that $100 million in assistance the future for BlueScope in Port Kembla would have been very dire indeed—much worse, in fact, than the current situation.

The plan for the fund contains two elements. The first will provide for a competitiveness assistance advance payment, which I have just referred to, to the value of $164 million in 2011-12. The second element will be the balance, which will be made up to $300 million over five years from 2012-13. The net effect of the free permits provided under the Jobs and Competitiveness Program and the additional $300 million in assistance under the Steel Transformation Plan mean that, effectively, the steel industry is completely shielded from the impact of the carbon price and is provided with the necessary assistance to enable it to try to restructure itself and trade its way out of a very difficult global and domestic environment for steel. This government is committed to ensuring that there is a bright future for steel in the Illawarra and throughout the country. As a local member, I will be working with other members representing manufacturing electorates to make sure that our government does everything within its power to assist steel manufacturing through this difficult environment.

The countries of the world are changing. They are, in effect, in a race to transform their economies. We are not the only country which is acting to transform itself to make sure that we have the capacity to reduce our carbon emissions and to transform our industries and to ensure that, as they grow, they do so in a way which is environmentally sustainable and preserves the planet for the future of our children. If we know that we are in a race to transform our economy, it beggars belief that in this country we would want to implement policies which would hamstring our country in the race—that we would say that we know that the world is in a global race to transform itself but that we should have a handicap and not start making the transformation as soon as possible.

I am pleased to say that this package of legislation has the balance right. It has the balance right between providing assistance to households and ensuring that, on the one hand, our emissions-intensive trade-exposed industries have the right degree of shielding to be able to trade and be competitive in a difficult environment and that, on the other hand, they have the incentives to reduce their carbon emissions. It has the balance right in that it will provide significant funds to assist manufacturing, food and foundry industries to transform themselves with assistance from government through co-investment schemes. It has the balance right by ensuring that households and businesses are assisted through the process of transformation. We are doing the right thing by putting a price on carbon and, instead of having a centralised, government-controlled mechanism where government makes the decisions and attempts to pick winners, we will enable individual businesses and individual households to make the millions of decisions on an hourly and daily basis that are necessary for them to be able to transform their work and consumption practices and their household arrangements and so reduce their energy use and carbon emissions.

In this debate there has been some criticism of our intention to ensure that, as we move to an emissions trading scheme, we will enable ourselves to integrate with other economies around the world which also have emissions trading schemes in place. In fact, the attacks I have just heard from those opposite include an attack on the international trade and emissions permits. This attack falls awkwardly from the mouths of those who deny the fact that there is international action on climate change. On the one hand, they argue that we are so far out in front that we are acting in a way that is completely incompatible with every other economy in the world; on the other hand, they criticise us for attempting to put in place a mechanism which will enable our emissions trading scheme to be integrated with similar emissions trading schemes in Europe and other places around the world. However, what lies at the heart of these criticisms is not a serious policy confrontation but an attempt to whip up the fear that there is some conspiracy behind these arrangements. These criticisms have very little policy credibility.

I commend the package of legislation to the House. This is without doubt a difficult debate, but I return to the theme that I started with: the prosperity that we now enjoy in this great country of ours was the result of the efforts of men and women who were willing to put aside their immediate interests and invest in the future. They had the courage to put the national interest and the future interests of this country ahead of immediate short-term political opportunism, and I encourage all men and women in this place who are of good will to act in that tradition, which is in the best traditions of this country and this parliament, by voting in favour of these bills.

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

I do not think we need to dig too hard to find why that address by the member for Throsby could possibly go down as the most passionless, unconvincing address in this parliament, certainly in the almost 10 years that I have been here. As a member representing a manufacturing electorate he knows, in his heart of hearts—as do all the other members on the other side, including the member for Corangamite, and as do the senators who represent Victoria and New South Wales—that manufacturing regions are suffering. I am sure those members do their job and speak to those who run large manufacturing businesses and small manufacturing businesses and speak to the union members who work in manufacturing enterprises, so they know what everyone else in this country knows: a carbon tax is going to have a negative impact on our manufacturing sector. Why? Because it will make the cost of making things in Australia more expensive and, effectively, it will give a leg-up to imports that compete with our manufactured goods.

That is one aspect of why the member for Throsby would be so downcast and passionless while perhaps doing his duty by his party. Perhaps it is time for him and others on the government benches to think about their duty to Australia and what they could do in the national interest. The Prime Minister has talked much about the national interest in the last few days. Perhaps some on the other side could think about the national interest in deliberating on how they will vote on these bills.

In trying to encapsulate what is fundamentally wrong with the government's approach I was given some great insights and guidance by some of the comments that Morris Iemma, former Labor premier of New South Wales, has said. I will indulge myself and the House by reading some of his comments because I think they are very illuminating. He said:

One thing is sure—it won't change the world, but it could change the government.

We embraced economic growth, and the benefits of economic growth, in the Hawke-Keating era, but we're fighting this battle on the Greens' turf, not our turf. Bob Brown wants to replace the Labor Party as a major party.

He went on:

Yes, we should take action, but we should not get so far out in front that we injure ourselves.

He said:

Every day there are reports of growth and development in China, its growth in emissions will far outstrip our total emissions.

And:

We've adopted a policy which is part of the Greens' agenda.

And the Greens' agenda is anti-growth and anti-investment. Lower growth and lower investment lead to lower incomes and fewer jobs.

We should always be standing shoulder to shoulder with steelworkers and miners and factory workers before we stand shoulder to shoulder with the likes of Bob Brown and Christine Milne.

I do not think it could have been said in clearer words. Those are the sorts of words one would have expected a solid Labor citizen of bygone eras to have come out with but today we hear nothing of those words from current representatives in this House.

Don Argus has also made some interesting points. Sometimes the obvious points are not repeated often enough. Don Argus has said that change is not reform. That is obviously true. When governments find themselves in trouble and they want to appear as if they are acting in the national interest they rush to change something. Irrespective of whether it is good or bad they will label it as 'reform' rather than 'change' because the word 'reform' has innate positive qualities.

Let us ask ourselves why this government is pursuing this change. If you believe them, and it was to save the planet—to reduce worldwide emissions—then we would have heard the Prime Minister say, before polling day: 'We need to do our bit to save the planet. That is why I promise you that the government I lead will introduce a carbon tax.' But she did not. The only reason we are having a debate on these bills is that that is the price that was extracted by the Greens to support the Prime Minister in keeping her job after the election.

I am very disappointed with that because the Prime Minister is touted as a great negotiator. If, in fact, the Prime Minister was a great negotiator she should have worked out that there is no way that the Greens would ever have supported the coalition. She did not have to sell the Labor Party's soul and give them this job-destroying, economy-destroying carbon tax. We are here because the Labor Party panicked and decided to give in to the Greens' demands. So when we hear those sanctimonious words—that this is all about the environment; this is all about saving the planet—we know that they are not true.

What we may find is that we may end up with an increase in worldwide emissions because when we export our manufacturing to countries that are not as efficient as us they will make the same things we make but create more emissions in doing so. We have seen in Europe that they have effectively exported some of their manufacturing. They still have a demand for goods that produce emissions but those emissions are produced in other countries. That carbon leakage will certainly occur in this nation as well.

There has been a bit of misinformation. The government are trying—they still are—to convince us that we cannot be behind the rest of the world and that we have to stay in step with what the rest of the world are doing. But who are we staying in step with? Absolutely no-one. The only steps we are following are the ones carved out by the Greens in this parliament, and they are hardly the voice of mainstream Australia.

We have seen disingenuous comparisons made with China. And we have seen the climate change minister embarrassed because he referred to a report that said that China had a higher effective carbon price than we did. That was found not to be correct and he embarrassingly tried to distance himself from the report. When we look at China's official policy we find that the policy is actually to reduce emissions intensity. If you look at the projected growth you find that if China reduces its emissions intensity by 17 per cent by 2015 it will work out to be an increase in total CO2 of 17 per cent on 2011 figures in absolute terms. When we look at the rest of the world, we see that no-one has introduced the sort of carbon tax the Prime Minister is proposing. That is not because no-one smarter in the world has come up with this; it is because everyone else in the world is more concerned and focused on what they can do to assist their economies and industries to survive the current difficult economic times that they face. When we look at what Europe has done we see that 95 per cent of carbon permits in the first few years of its scheme were given out for free. We found that the scheme in Europe had effectively little impact in reducing emissions. A Euro poll found that there was about $5 billion worth of fraud in the purchase of overseas permits in just under two years. This government, on its own figures, says, 'By 2020 we will reduce emissions by 160 million tonnes.' Guess what? One hundred million of those tonnes will be through the purchase of permits from overseas. The European Union Emissions Trading Scheme raises about $500 million a year, and that is how much this government's carbon tax will raise in three months. The impact of the carbon tax in this country will be something unprecedented in the rest of the world.

India, which accounts for five per cent of total global emissions, and rising, has no plans for an ETS. Canada has no plans for an ETS. The US has effectively abandoned all talk of an emissions trading scheme. So the time has come to really assess what the government are trying to do and for members on the other side to look in their heart of hearts and, for just once in the term of this government, put the national interest ahead of their party's interest, because the impact on the Australian economy and the cost of living will leave its mark. It will take years of suffering and years of restructuring our economy, and it will see efficient businesses go offshore.

Households are already suffering with the increase in the cost of living. We have seen the cost of housing increase, yet a carbon tax will increase the cost of a new home by $5,000. It will add $36 a month to the average mortgage of just over $340,000. The Food and Grocery Council said that the annual increase in grocery bills will be $120. Australian cars will be $400 more expensive than imported cars because of the carbon tax. Agriculture will have increased costs through the increase in the cost of fuel, fertiliser and electricity. There is even the local supermarket. I take the example of a supermarket in Wangaratta. The local IGA calculated the increase in their electricity costs. They said to me, 'Our competitive advantage is that we are 1c cheaper than the major supermarket, so we can't put up our prices. So we've already told our staff that, in order to pay for the increase in the electricity bill, we will have to reduce staff numbers.' These are real businesses out there trying to make a living and trying to employ people in their local communities.

Many industries have commented on some of the government's figures. A very important part of our manufacturing base is the food and grocery sector. In fact, it is the largest manufacturing sector. Kate Carnell, the Chief Executive of the Australian Food and Grocery Council, said:

For Julia Gillard to say that food companies who aren’t in the top 1000 emitters won’t be affected by carbon tax is simply wrong.

Manufacturers will be impacted right across the supply chain from higher costs in transport, power, refrigeration and food and grocery manufacturing.

We have seen comments right across the heavy manufacturing sector as well. Interestingly, we have not heard too much from someone who should be representing manufacturing workers. In April, Paul Howes, the National Secretary of the AWU, said:

Carbon pricing could be the straw that breaks the camel's back as far as some of these industries are concerned.

If one job is gone, our support is gone.

I do not think I would rely too much on those words because jobs are going now in preparation for a carbon tax.

The government has spoken much about compensation, but Graham Kraehe from BlueScope Steel says that compensation under this scheme would be like putting 'a bandaid on a bullet wound'. Industry compensation is supposed to last for four years. What happens after the four years when the price of electricity keeps going up and up? Does anyone honestly believe that industry planning for capital investment in five years time, after the compensation runs out, will not be starting to run down their operations now for the time when there will not be compensation? What about hospitals, nursing homes and schools, where the Victorian government has shown that electricity prices will increase by $120,000 a year? Community organisations will face increased costs. None of these have really been factored into the government's thinking on the impact this will have on local communities. This says nothing of the fact that most average Australians will be worse off under a carbon tax. The government should have a serious rethink and take this issue back to the people, because it lied about introducing a carbon tax and people should have a say. (Time expired)

Gai Brodtmann (Canberra, Australian Labor Party) Share this | Link to this | Hansard source

It is with the greatest pleasure that I rise tonight to speak on Clean Energy Bill 2011 and associated bills and the need to take strong, positive and effective action to tackle climate change and drive a clean energy future—a future the next generation of Australians deserve. I have been waiting for three years for this opportunity and I am delighted that I am able to stand in this House today and add my support and the support of the many Canberrans who have phoned me, emailed me, written to me and spoken to me personally, calling for strong leadership and strong action on this issue. The science is in. It is clear. It is beyond reasonable doubt. The world is warming, the oceans are becoming more acidic and the biodiversity of our planet is at risk. This is the clear message of the research. I believe what the scientists say. I believe the Australian Academy of Science when it says that there has been widespread melting of glaciers and icecaps, when it says that the Greenland icesheet is losing more than it gains through snowfall and when it says that the Arctic sea ice has decreased significantly. I believe the scientists when they say that the average surface temperature in Australia has increased by about 0.7 degrees since 1960. This warming has caused an Australia-wide average increase in the frequency of extremely hot days and a decrease in the frequency of cold days.

It is also clear that the leading cause of this rapid degradation of our climate and the broader environment is the emission of carbon dioxide into the atmosphere as a result of human activity. I say this because I have read the science and I have spoken to the scientists. The ice-core samples I saw during a visit to the University of Tasmania, with the Joint Standing Committee on the National Capital and External Territories, clearly showed that the amount of carbon in the atmosphere has increased since the rise of the Industrial Revolution and the increase in the burning of fossil fuels that started at that time.

To support this, I offer again the words of the Australian Academy of Science, which says quite clearly, 'Human activities are increasing greenhouse gas levels in the atmosphere.' Anyone who has worked with a scientist or an academic will know that such clear, unambiguous declarations are rare from people who are very considered in their statements. The academy also says, 'It is very likely that most of the recent, observed global warming is caused by increasing greenhouse gas levels.' These statements—and statements by others—have convinced me completely that we must act to address the emissions of carbon.

I agree that there are a number of ways we can do this and I agree that there is no one-size-fits-all approach. But the experts are clear and consistent in their agreement on the best way to reduce carbon emissions. The experts agree that the most efficient and effective way is to place a price on carbon and to move towards a carbon trading mechanism. Once again, I do not make this statement unsupported or uninformed. I am informed and swayed by the people who know best: the experts in their areas. According to Macquarie Bank Chief Economist Richard Gibbs, consumers need a price on carbon to shift economic behaviour towards lower carbon and more energy-efficient options. These experts, both the scientists and the economists, have convinced the esteemed magazine the Economist. Once again, the government has listened to the experts and has acted on their advice.

The package of legislation introduced yesterday will do precisely what the economists, academics, climate scientists and even the Australian have been urging us to do for years. Our package will put a price on carbon. It will reduce carbon pollution and it will drive investment in a new cleaner economy. Our package will grab the opportunities of a clean energy future. Our package will create new jobs and ensure that Australia remains the envy of the world for decades to come. Our package will transform and modernise the Australian economy, at the same time supporting the people Labor has always supported: workers, pensioners and low- and middle-income Australians.

Our package will see Australia's annual emissions reduce by at least 160 million tonnes by 2020, which will be the equivalent of taking around 45 million cars off the road. Our package will drive investment in cleaner industries through the $10 billion Clean Energy Finance Corporation and the $1.2 billion Clean Technology Program, a program that will improve energy efficiency in manufacturing industries and support research and development in low-pollution technologies. Our package will ensure builders, tradies, engineers and apprentices get the specialised green skills that will be increasingly in demand in Australia through the $32 million Clean Energy Skills program. (Quorum formed)

Our package will support small business and action at the local government and community level. Our package will encourage farmers to explore carbon credit options. Our package is good for every Australian, every arm of the Australian economy and the economy as a whole. The modelling done by Treasury—and I know those opposite do not like the opinions of experts who disagree with them, but nonetheless they are indeed the experts—shows that this package will see 1.6 million new jobs by 2020 and gross national income per person increasing from today's levels, which are around $56,000, by around $9,000 per person to 2019-20. By 2050, the increase is expected to be more than $30,000 per person in today's dollars.

This package will also support Australians as we transition to this new cleaner economy, though CPI is only expected to rise by 0.7 per cent—less than the impact of the GST—and the assistance to the average Australian household will outweigh the costs. Nine in 10 households will receive a combination of tax cuts and increased payments to help them with the cost of living. Almost six million households will be assisted through tax cuts or increased payments to cover the average expected price impact. Over four million households will get assistance that is at least 20 per cent more than the average expected price impact. Over one million Australians will no longer need to lodge a tax return.

This is a comprehensive package that is supported by evidence and experts and has been extensively modelled. Contrary to what some in this place may be saying both here and in their communities, it is a package that has been in the public domain for discussion and comment for several months now. It is also a package that has received strong support from my electorate. I quote now from some of those supporters. Tara from Isabella Plains emailed me to say:

I am writing as a constituent and a strong supporter of action on climate change. The scare campaign has confused people, but I wanted you to know that I want a price on pollution and I'm talking to others in your electorate about it.

I urge you to vote in support of the price on pollution and the Clean Energy Future legislation and speak out in support of taking action on climate change.

Jeanette from Conder said:

I would like to support the government's initiative on the carbon tax, in strong opposition to the campaign being waged against it.

I do not want to see my grandchildren's future held hostage by ignorance.

Gerard from Gowrie said to me:

I want you to know that, as a member of your constituency, I say yes to a price on carbon pollution, and Yes to new money for clean energy.

Please support this important step forward for Australia – by voting Yes.

Rona from Yarralumla wrote:

I believe history will applaud you, and that those who come after us will feel respect and gratitude for your stand.

I believe the majority of Canberrans want this package, particularly the women—the grandmothers, the mothers, the sisters, the daughters. I was deeply moved by the audience in the public gallery yesterday who had come to witness the historic introduction of this package by the Prime Minister. What moved me most was the number of women who had taken the time out of their busy lives to be part of that significant moment—women young and old, women with toddlers and babies in slings. In fact, I understand one woman travelled from Adelaide to be part of history.

Most of the people in Canberra want this package and want it for their children's future. Now is the time for leadership. Now is the time for considered action to protect our future prosperity. Now is the time to put aside the gross partisan politics that has gripped this current parliament and to act in the national interest. Now is the time to think big and long term; to be bold and innovative; to walk in the footsteps of Labor legends like Bob Hawke, Paul Keating, John Button, Peter Cook and John Dawkins; and to transform and modernise this economy so we can flourish in the future.

As with the transformation and modernisation of the Australian economy in the eighties, we know reform is tough. But reform is part of the Labor DNA, and we know that this reform is right for this country today and tomorrow. Imagine what Australia would look like today if we had not undergone the reforms of the eighties. We would probably still have four banks and we would probably still be paying a premium for money if we could get it. We would still have protected industries clinging to the past with outmoded and inefficient work practices. We would probably just be entering the open and liberalised world now, as we see with some other countries throughout the world, having wasted decades of opportunities, decades of prosperity, decades of a possible future—the future that we have today.

A failure to act—a failure to put in place the best policy for the future—risks not only environmental catastrophe but economic ruin, as Australia will find itself unprepared to compete in the industries and the world of the future. This country has always been a leader in adapting to changing times. We have always been able to absorb the changes to the economy, and we are more prosperous as a result. Now is not the time to allow our economy to atrophy.

I would like to remind those opposite that now is not the time to look backwards. Now is not the time to say no. Now is not the time for the leader, rather than being a Leader of the Opposition, to be more the leader for opposition. Now is the time to look forward and plan to ensure our future prosperity. At the moment, what we have opposite is an opposition that has a 'plan'. I use the word lightly because it will cost Australia and Australians an extraordinary amount of money—some $1,300 per person—to pay polluters so they can kindly agree to stop polluting.

In closing, I would like to say that I commend the government for introducing this bill. I intend to be able to look my nieces and nephews in the eye in 20 years time and say I showed leadership today. I intend to look them in the eye and say I was bold and innovative and wanted great leadership—that I did it for their future, their children's future and Australia's future. (Time expired)

John Cobb (Calare, National Party, Shadow Minister for Agriculture and Food Security) Share this | Link to this | Hansard source

I rise to speak on what is in effect a carbon tax. Let me start by giving you an overview of my electorate. The Calare electorate is the powerhouse of New South Wales: it is built on mining, energy production, agriculture, forestry and transport—industries which will be absolutely hammered under the Gillard government carbon tax. It is also a regional electorate, and it is no secret that the regional areas of Australia are set to be the hardest hit under a Gillard government carbon tax. Recently released New South Wales Treasury figures underline that. One thousand jobs will be lost in my part of the world alone. The carbon tax is bad news for regional Australia and it is most definitely bad news for the electorate of Calare.

Last month a community forum on the carbon tax was held in Bathurst. I was invited to speak along with three industry representatives of the three big industries that Calare relies on: mining, agriculture and small business. The aim of the forum was to give the public a chance to listen to industry leaders and gain a better insight as to how the carbon tax would affect our region's industries. The overwhelming response was that the carbon tax was certainly not welcome in Calare. There was no doubt that the forum was anti carbon tax, yet the question was asked, 'Why hold a one sided forum?' The taxpayers had $21 million of their money spent on advertising one side of this debate—the rubbish side—so I do not think there is too much harm. I think they have the right to have the facts and the actual cost to them as people and as businesses put to them free of having to listen to the rubbish the Prime Minister and her people have been speaking for some months.

Over the past months I have been visiting businesses and residents in Calare regarding this tax. The people of Calare are not stupid. They know that reshuffling money—and that is what this is, largely, taking from someone and giving to someone else—and compensating families as Labor proposes will not in any way change people's habits. This is one of the huge hypocrisies: 'We are going to tax you to make you change what you do, but at the same time we want to give you money back so it will not hurt you.' So why the hell would you change?

That is why the coalition supports a direct action plan, because we believe in practical action and common sense rather than making people do what they do not want to do and what they do not have to do at this time. New South Wales Treasury figures released last month confirm that regional Australia will be hardest hit. A total of 31,000 jobs are predicted to be lost in our state, with 1,000 of these in the central west. It is the third hardest hit area for job losses after the Hunter Valley—the member for Hunter's part of the world, and you would think he would know better—and the Illawarra. These figures alone are damning enough. A carbon tax will cost local jobs, particularly at a time when our region is still recovering from a decade of drought. It is the last thing we need. Central and western New South Wales need a carbon tax about as much as they need a hole in the head.

We know that this tax will also significantly increase the cost of living for families. Figures are predicting electricity bills in New South Wales will rise by nearly $500 next financial year. It is interesting that the Prime Minister talks about a 10 per cent rise in electricity costs while the New South Wales government said, 'That is wholesale; it is 15 per cent at a retail level.' Electricity producers passing on the costs of their carbon permits is only for starters. For families that are already struggling with the cost of living this tax is the last thing they need. Families need this tax like they need a hole in the head.

Mr Deputy Speaker, let me give you an overview of the business from across Calare that will suffer under this Gillard government's carbon tax. In Blayney, one of the progressive parts of my electorate, Blayney Wholesale Foods is probably one of the best examples of how severely this carbon tax will impact upon a local business. Over the past five or six years this local business has become a new, modern business. There is no way this business can have more efficient use of electricity than it currently has. This is a cutting-edge cooling and freezing and packing business. It operates two large freezer warehouses in Blayney and employs over 100 people. The company stores and packages frozen food for a number of national companies and provides food services throughout the Blue Mountains, the central west, across Australia and to exporters. Almost all foodstuff spends time in cold storage, if not in frozen storage. Cold storage businesses specialise in providing services in temperature controlled storage.

George Tanos, the managing director of Blayney food products, has done the figures for his business and estimates the carbon tax will see a 20 per cent rise—not 10, not 15 but a 20 per cent rise—in electricity costs, and this is on top of what he has seen in the last five or six years, which is a 100 per cent increase in his power costs. The carbon tax is essentially a tax on electricity, and cold storage facilities such as this will have the company's ability to operate slashed. We are talking about a modern, innovative business which has already implemented every efficiency possible to keep usage of power down, yet with a carbon tax the cost must be added to food prices that are already soaring due to a tax which is also pushing up the cost of producing, transporting and processing that food. What is more, this tax will make Australian produce less competitive on the international market when it comes to trade. It really is a catch-22. It must be something to be proud of. I cannot believe that this government has worked out how to knock over Australian industry quite so efficiently. At the end of the day Calare's families will have to pay, whether they produce or whether they work for those who do. Should this tax become a reality, what benefits are there for this business? It can do nothing to avoid it. It cannot get more efficient. What is in it for this business, and what is in it for the people who are going to have to pay the extra costs that business has to absorb?

Another example in my part of the world is a regional New South Wales grain processor. He buys about $50 million worth of local product and his annual power and gas bill will go up by one-quarter of a million dollars in the first 12 months. I am not talking about BHP here; I am talking about a family company that will cop another quarter of a million dollars in tax in the very first 12 months of this idiocy. And then on top of that you have Delta Electricity. Do you think they are happy? They are one of Calare's biggest energy producers and a very big employer in the eastern side of my electorate. We have Simplot Australia, a refrigeration, cold food, packaging, distribution and pet food company. Do you think they are happy? They are going to cop it too. The numerous truck owner-drivers through the transport industry will not be hit by this for a couple of years but, my heavens, they probably are the wildest of all those who have to face this tax.

There would be over 10,000—something like 10½ thousand—small businesses in my part of the world in the Calare electorate. I do not know how one of them will get any off load for what it is going to cost them. Not one! A small coffee shop is going to wear about $1,500 worth of power costs in the first year. How offensive can you get? But Julia Gillard and her government want to give them hell, and they will.

Power bills will continue to rise and businesses will be forced to pass costs on to the consumer because for most businesses there will be no forms of compensation—certainly not for small business. Businesses are already doing it tough, and as a carbon tax becomes a reality Australian businesses will be at a major disadvantage. And we are only talking domestically at the moment; this is before we get to the exporters. No other country in the world is going to go with anything like this. Under the current economic circumstances, why would you do this to your own people?

Currently this government claims that agriculture—and this is wonderful—is excluded from the carbon tax. I have been a farmer my whole life and I can tell you that we are not excluded from this tax. Very few industries will be as belted by it as we will. Every farmer knows it.

The agricultural industry alone will be one of the hardest hit. Fuel might be excluded for a couple of years but, heavens above, we are going to be belted after that. The government has ignored the major impact on the processing industries which take control of everything when it leaves the farm. We have to buy superphosphate, we have to buy diesel, we have to transport it and we have to grow it. Then the people who we sell to or work through have to process it and some of the processors for agriculture will be the biggest hit by the carbon tax—more than almost anybody—let alone the costs of processing.

There are examples of that. The Murray Goulburn Co-operative will incur carbon costs of over $5,000 per farmer, and guess who will pay for that? The farmer. And that is without the fact that an average dairy—not a large one—will probably spend another 3½ thousand dollars on extra electricity prices. Then there is the fertiliser, then there is the gas, and a lot of them also have cold storage.

The big meat processors are in a similar position, whether they are the beef or sheep abattoirs. The sheep blokes are going to cop an increase in costs of about 30 cents per sheep and about two or three dollars for cattle. We are talking enormous money here on industries which only survive on narrow margins through large inputs.

Rice farmers are particularly unhappy and yet they are not supposed to be copping a carbon tax. Let me tell you that about $10,000 per farm is what it will cost them in on-farm costs. That is what Sunrice will have to pay as a major emitter and there is only one processor and dealer in rice in Australia.

As I said, New South Wales grain processors are going to cop it. And who do you think they get their grain from? Farmers. And given that a lot of this processed grain has to be exported, do you think they are going to be able to say to their trading partner overseas: 'Look, sorry, we are going to have to put the price up. Gillard and her government have decided we have to pay more.' Likely? Not very likely.

Nobody is going to be belted harder than anybody who works the land, whether it is direct or indirect. I cannot believe that any government would decide that they have to do this to their own. Whether it is small business, someone who works for them or a farmer—whoever it is—why would you want to take a set on your own people? Why would you not listen to two-thirds of the population telling you to knack off and not to do it?

This is very much about politics, about pleasing the Greens and about the Prime Minister remaining the Prime Minister—not for very long. There are people in this House who represent electorates and who have the power but whose electorates not only do not want this but cannot believe that their representatives created the government that they have.

There are people in this House who, if they listened to their electorates, could stop this. They could most certainly stop this happening. We are a democratic nation, and there are a couple of people who came to this House, created a government and said, 'We are doing that because we believe this will be the most democratic and open form of government if we create the Gillard government,' and yet those same people have combined with that government to guillotine the length of this debate, allowing for people to speak on average for less than one minute on each section of this bill.

Sharon Bird (Cunningham, Australian Labor Party) Share this | Link to this | Hansard source

You've had more than one minute!

John Cobb (Calare, National Party, Shadow Minister for Agriculture and Food Security) Share this | Link to this | Hansard source

There are 19 sections to it. I cannot believe that these people would even want to go home, because let me tell those who could stop this, whose electorates are begging them to stop this idiocy: if I were you I would not go home, I would go to hell.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

I will be going home this weekend, very proud that I have spoken on the Clean Energy Bill 2011 and related bills. I believe that we all come to this place—all of us, on all sides of politics, from whichever political party—to make our electorates a better place. I heard the previous member speak about his agricultural area. I truly believe that he does care about his electorate and about agriculture in this country. But, if we truly look at this issue, we would be saying to those farmers and to those people the member for Calare was speaking about on this particular issue of our climate changing drastically over the next few years, and the next generation, that it will mean there will be no agriculture—absolutely zilch—if we do not do something about it. I think that, as members of this place who have been elected by our constituencies to be here, all of us want to ensure that when we leave this place we have done something for the betterment of the future generations of Australia. If we do not pass this bill, it would be remiss of us to think that we are doing our jobs. Our job is about the present but also about ensuring a better place for future generations, whether it be our children, our grandchildren or our great-grandchildren. That is why I will be very proud to go back to my electorate this week.

It gives me great satisfaction to speak on these bills and to support them. They go towards correcting in Australia what is arguably the greatest market failure of all time: the historic ability of people to pollute our atmosphere with greenhouse gases without limitation, and that is what we have—without fee or fine, with complete impunity, to the detriment of us all and, even more importantly, to the detriment of future generations of Australians. The consequences of this market failure, as we are increasingly seeing, are promising to be dire. (Quorum formed)As I said, the market failures we are increasingly seeing are promising dire consequences for our world—our coastlines, our rainfall patterns, our ability to feed ourselves, and the composition and dynamics of our world. This market failure has to be corrected.

The volume of hot air emitted by politicians, commentators and the like on this issue over time is itself a potential health hazard, I am sure. The number of ridiculous statements, contradictory statements and misrepresentations that we are hearing is enough to make many members of the public turn off from this debate and this issue. But the reality of our situation, our recent history and what is happening around the world needs clarity of perception and lucidity in thought. We need to recognise our reality and act appropriately based on the best available advice, as each of us strives to do in our own private lives.

Here are a few quick facts. Yes, the world is moving on this issue. This includes, of course, not just the UK, Europe, Canada, South Africa, South Korea and very large blocks within the United States; it includes China, and no amount of camouflage from those opposite can conceal this fact. China is moving to introduce a carbon trading scheme in its three industrial powerhouses of Beijing, Shanghai and Guangdong, from where it will be rolled out across the country, and this is a reality; this is happening. So we are not leading the world on this issue, as opponents claim—as if that would be a bad thing anyway. We are seriously at risk of being left behind, to our own detriment.

The assertion by the coalition that Australia is so insignificant a nation and a people that what we do does not matter is highly flawed and more than a tad insulting. Australia is one of the 21 highest-polluting nations in the world. We also emit more per head of population than any other country; we are the highest polluters in the world per capita. Also, we are one of 14 nations that emit similar volumes of carbon pollution: we are one of the 14 countries that each emit between one and two per cent of global emissions, which add up to 20 per cent of the world's emissions. So if we expect South Korea, France, the UK, Italy, Spain, South Africa, Canada and others to act—which they are doing—then how on earth can we argue that we do not need to? If countries the size of Australia were to sit back and do nothing, the global effort would be most seriously compromised and simply would not work. So we need to be smart in doing what is in the world's best interests, which is also in our own interests. With our climate, it is even more in our interests than for most. As I have said, more and more countries are pricing carbon emissions and moving to price carbon. The suggestion that it will destroy or even damage our economy is absolute rubbish. What will destroy our economy is if we do nothing. Apart from our trading partners pursuing similar policies, our trade-exposed industries will be generously protected from adverse consequences. They are facing challenges to their profitability that are much greater than this. There is more risk in the price of the Australian dollar, for example, than anything in this collection of bills.

We have heard that people will be worse off as a result of the carbon price flowing on to consumers who will receive most of the revenue raised by the carbon price's compensation. That is the scare tactic being used by those on the other side. We have also heard the other side say that people will receive too much compensation. Nine in 10 households will receive compensation. The cost will be on average $9.90 per week, 50c or less per $100 of groceries, 70c per $100 of outlay overall. Compensation will on average be $10.10 per week more than the cost passed on to the average consumer. If that represents overpayment to pensioners, as we have heard from those opposite, then I am happy for the pensioners in my area to receive that payments and be better off under this policy. If people argue against these bills for fear of pensioners getting too much money, I will argue in their favour, as will all of us on this side. I do not object to that at all.

Consumers, the public, have nothing to fear from this policy. Compared to the rising cost of our health system, for example, which has threatened to overwhelm our states' budgets and compared to the future costs of Medicare, aged care and other public services systems, this is not an especially large amount of money. We need to keep it in proportion. As I said, $9.90 per week for which compensation will be $10.10 on average.

There has been an increase in the recognition of our need to address, individually and collectively, the issue of pollution. Support for this policy has been widespread amongst political parties as it has been amongst the public. This is evident in our recent history. Our previous conservative government grappled with the issue and ended up signing the Kyoto protocol. They did not ratify it, but they signed it and by signing it they adopted the policy of acting on greenhouse gases. Ultimately they supported the policy of a cap-and-trade emissions trading scheme which is what we have in the bills before us.

Labor came to power in 2007 promising action on climate change. Soon we were developing our cap-and-trade emissions trading scheme. This ETS, named the Carbon Pollution Reduction Scheme, was supported by all of us on this side. Evidently it was also supported by the Australian public through most of the last parliamentary term. After being blocked by the oppositionist Greens, Liberals and Nationals in the Senate on three occasions, the CPRS was withdrawn. But its future as Labor policy, the future reintroduction of an emissions trading scheme, has never been in doubt and was never in doubt. When former Prime Minister Rudd announced that Labor recognised the Senate was hopelessly divided on the issue such that the bills would not pass in the foreseeable future, he said that the scheme would be delayed; in his words he would 'extend the implementation date', clearly not Labor's choice, but due to a hostile Senate.

Labor has been the party of consistency on the issue of climate change. We have been the party of consistency on our need to deal with it meaningfully and our support for a cap-and-trade emissions trading scheme as the way to do it. This has been constant throughout Labor's two terms in office, from 2007 when Labor first formed government to now. There has been absolute consistency that we need a cap-and-trade ETS and that we will introduce a cap-and-trade ETS. Everyone has known this since at least early 2010. It has been a matter of when not if. It has been as clear as crystal. This has been the government's position and the position of all of us on this side of the House. Back in 2009, a number of constituents argued in support of the opinion expressed by a few high-ranking US officials who advocated for a flat-rate carbon tax instead of a cap-and-trade emissions trading scheme. Conservatives who do not want Labor in power argued for a flat-rate carbon tax principally because Labor opposed one.

A carbon tax does not limit the volume of pollution. It has no cap on pollution. A cap-and-trade scheme does and a cap-and-trade scheme cap can be lowered over time to decrease emissions. This is a pretty fundamental and glaring difference between the two approaches. They could not be more dissimilar. We need Labor's plan, a scheme which caps emissions by use of a finite number of pollution permits which are decreased over time, to lower the cap on pollution and decrease the volume of pollution.

The public's view of anthropogenic climate change has been with the government. Over the period 2006 to 2009, Morgan polled public support for action on global warming at around 60 to 70 per cent consistently and, in 2009, recognition of human contribution to global warming at 83 per cent. In 2009, a Nielsen poll showed 65 per cent support specifically for the CPRS. The 2011 Lowy Institute poll showed 81 per cent of the Australian public supported action on climate change: 40 per cent supported action at low cost and a further 41 per cent supported action even if it was at high cost. That is 81 per cent support for action.

We all know the overwhelming economic advice that a cap-and-trade emissions trading scheme is the most low-cost, meaningful action that a government can take. There is 81 per cent support for the government's strategy. People may cite other numbers derived in response to other questions and other perceptions of consequence, but the fact remains that the Australian public has and continues to recognise that human induced climate change is an issue and we need to deal with it. The Australian public has supported this action. (Time expired)

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

It is an honour to stand before the parliament tonight and follow through on what I promised my electorate I would do. That was along with 148—maybe 147, if you want to argue the point—other members in this House, who all went to the last election promising that there would not be a carbon tax. I am happy to stand here tonight and honour my undertaking. I wish those opposite would do the same. In fact, my electorate and electorates right around Australia wish Labor members would actually do what they promised. They still have ringing in their ears the deceitful words of a Prime Minister who got elected by stooging the Australian public by promising, 'There will not a carbon tax under the government I lead'.

The Prime Minister has rightly been attacked for making such a blatant and calculated statement so late in the election campaign and clearly motivated by the hesitation of many thousands of Australian voters who believed in their hearts that you could not quite take the Prime Minister at her word. After the backflip involving the abandonment of Kevin Rudd's climate tax arrangement and Carbon Pollution Reduction Scheme, people were not convinced—and we on this side of the House understood. That is why there were repeated challenges to the Gillard government, its ministers and the Prime Minister to be frank and straight with the Australian public about their intentions concerning a carbon tax.

The Leader of the Opposition, I think at least a dozen times, highlighted what we understood was the secret agenda of the Labor Party and of Prime Minister Gillard and her ministers. That was to sneak in, slip-slide into office, hope that no-one really challenged them on their intentions with the carbon tax and go and do it anyway in the spirit of what Peter Garrett once outlined before the 2007 election—just get in, do what you need to do and then do whatever you feel like afterwards. That was the concern the Australian public had. So, staring down the barrel of a camera, just as I am doing now, the Prime Minister sought to reassure Australian voters that there would be no carbon tax under a government she would lead.

That was designed to remove the hesitation that so many Australian voters had about what Labor was really planning, and because of that I am certain that numbers of voters in many electorates across Australia thought: 'Well, okay; that's as black-and-white as it gets. If that's what the Prime Minister of Australia, albeit one that has only just arrived, is going to say, staring down the lens of a camera, maybe we could take her at her word.' That proved not to be the case. So a government was formed, a Prime Minister was re-elected by one of the most calculated deceptions, which exercised a great democratic deficit—

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

Order! The honourable member for Dunkley well knows that it is outside the standing orders—in particular standing order 90—for him to accuse the Prime Minister of a calculated deception. I require him to withdraw.

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

I thought 'lie' was the word, but I am not using that and I will withdraw if that language is too strong.

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

It refers to imputations or improper motives. Have you withdrawn?

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Link to this | Hansard source

Yes, I have, and you are right, Mr Deputy Speaker; I was accusing the Prime Minister of improper motive. That was exactly my point, so if that offends the standing orders I do apologise, because that was precisely what I was doing.

What happened after that reassurance? People voted, believing the Prime Minister. So a government was formed, and I must say that in this House of Representatives there are a number of Labor members who, on the basis of that reassurance, which has been proven not to be reliable, now sit in this place. There are elected Labor members here under false pretences, and the Australian public has not forgiven the Gillard government, the Prime Minister herself or, I would say, a number of the Labor members who went out to their electorates promising there would be no carbon tax under a government that the Prime Minister would lead.

So I am here tonight speaking in support of the exact undertakings I gave my electorate prior to the election and during the campaign and I just wish the Labor members would do the same. What has happened with one of the most extraordinary, not even subtle, about-faces for political self-interest that I can remember is that it has really rattled and unsettled the Australian community, and it has really caused an enormous chill to run through the Australian small business community. This manoeuvring by the Gillard Labor government has been very poor in its creation, and I have touched on what I think was an extraordinary democratic deficit in the way in which it has been brought about. It is now being perpetrated with a conscious and intentional disregard of the impact of these actions on a very important part of the Australian community—that is, the small business community.

Despite all of the carve outs and compensation arrangements that are touched upon and are a part of this bundle of bills that are before the House, the small business community has been completely ignored. More than two million small businesses and family enterprises will all face increased costs with no direct support, having been ignored by the Gillard Labor government. It is as clear as night following day and certain as to what the impact of this will be that the Gillard government is not on the side of small business, because if it were it would have factored small business's circumstances into its approach. Instead, despite a chorus of concern from the small business community about the added cost to its energy requirements and all of the inputs that will build and compound at every step and every stage of the production and supply service chain, no compensation in any direct sense has been provided to guard against the risk to jobs and small business viability that this carbon tax creates.

People in my electorate, as they are right across Australia, are wondering why the government is prepared to risk their jobs just to try to secure their own—why the Prime Minister is trying to secure her position by risking the jobs of many hardworking Australians and the viability of small businesses and the livelihoods of people operating and managing them. This dismissive attitude reared its head just recently, quite remarkably, in the Hon. Greg Combet's speech to the Press Club. He sought to argue that there were a number of myths surrounding the debate about the carbon tax, and he chose particularly to say—and I think quite recklessly in the way he described it—that it was a myth that small businesses are in some kind of jeopardy from the carbon tax. He went on to describe how he thought that the cost impact on them would be modest, which I found quite a remarkable statement to make given that, while the government has done modelling on households solely for the purpose of assisting Labor MPs to sell this Labor policy in their electorates, no effort has been made to model the impact of a carbon tax on different sectors of the economy and particularly on small businesses and family enterprises. But despite that lack of any evidence, Minister Combet still sought to say to anybody who had done that work and arrived at conclusions that were unhelpful for the government that they were wrong and he was right. In fact, he went and distorted some of the material that had been provided to him by COSBOA, the Council of Small Business Organisations of Australia, who actually had been begging the minister to do some analysis on the impact of the carbon tax and provided some basic figures against which it hoped the government would do the work that it should have done long ago.

Instead of using that material as an input to enable the government to get off its backside and actually do the work that it should have done a long time ago, Minister Combet waved that input data around as if it were the conclusion of some analysis and then said, 'Look, the impact was so minuscule, what are you worrying about?' But as if to be as insulting as he possibly could be, he went on to say:

But the fundamental point is that the cost is modest—

he is talking about the carbon tax, despite having no evidence to back that up—

and that it can be passed on to customers as small businesses are typically not trade exposed.

I found that a very fascinating statement. He is saying that it can be passed on to customers. These are very price-sensitive customers already groaning under increasing cost-of-living pressures that have been overseen by this government, but somehow those customers will be ready to soak up even more cost increases. But then he went on to make some of the most extraordinary statements I have ever heard. He said:

A drycleaner is not competing against drycleaners in China.

And:

Drivers cannot get their cars serviced in India.

What remarkable statements when, at the same time he is making those points, elsewhere in the same speech and in this place, and anywhere else where a Labor minister can get anywhere near a microphone, they talk about the power of the price signal in their carbon tax to reduce demand. The very purpose of a carbon tax is to put financial harm and hardship in the way of people hoping that they will consume less of what it is that the carbon tax will be applied to.

He then basically says, 'Well, if you're in the dry-cleaning business, don't worry about it. Dry-cleaning won't be competing against drycleaners in China.' But the price signal will make sure that people think twice about taking their clothing or their household items to a drycleaner, because of the cost. Why? Because that is the design of the scheme. It is a price signal designed to reduce demand. Reduced demand means less work, less turnover, less activity for that small business drycleaner, yet the government seems to be completely indifferent or oblivious to that fact. In making his argument he is basically saying: 'Well, when it suits the government, the price signal of the carbon tax just doesn't apply, it just doesn't matter. Unless you are trade exposed, it doesn't matter.' He said:

Drivers cannot get their cars serviced in India.

But go and talk to any car maintenance and repair operation in Australia and they will tell you people are not getting their cars serviced. They will tell you they are not getting them converted to LPG, because they are concerned about what might come next from this government, given that when they look to the nation's capital they cannot see an adult in charge! They know that their turnover is dipping, their costs are going up, their commitments in rent and equipment continue, their inputs will be more expensive and their business viability is being placed at risk at a time of difficult economic circumstances—and yet you cannot get the government to give two hoots about those people.

That is why you look at the impact of what the government is doing. You look at survey after survey where you see this incompetent government is hollowing out confidence. It is hollowing out people's expectations of future prosperity, future growth potential. And does the government care? No, because they then say, 'But look at the macroeconomic figures: we're at trend growth now.' They are happy to say that we are the envy of the rest of the world—that is the language you keep hearing—because we have got an absolutely boisterous and prosperous mining sector. Apparently the joy there wipes out any concern that might happen anywhere else in the economy. That is the government's basic defence: we have mining, therefore it doesn't matter how the rest of the economy is functioning.

I will share with the government what is going on. In the retail area they are dealing with anxious consumers uncertain about what the government is on about and absolutely clear that the government is not confident about its own policies because it will not have them properly analysed. Consumers are saving money. In a country where Australian households ordinarily 'save', and I use that term in inverted commas, negative 0.5 per cent of their household income—that is, they extend their credit cards and their mortgages and their lines of finance to improve their standard of living—right now about $10.50 of every $100 a household earns is being saved. It is being saved because of the anxiety people have about this cost-of-living pressure that never seems to stop. The bills are getting bigger, the discretionary income is getting squeezed. They are cocooning against the impact of bad government policy, and we are debating a package of bills that could never be more totemic of a bad government policy.

This is not about whether you want to take action on climate change; that debate has been had. Both sides of the parliament, just as they agreed there would be no carbon tax after the last election, committed to a five per cent reduction in emissions by 2020. The government's plan hurts and harms everybody, every business, every activity and every point of expenditure. Everywhere where energy is consumed or embedded in anything you might do at any time of the day, for as long as you could possibly imagine, will cost more. The hope is that it will hurt so much you will change your ways. Regardless of your capacity to change, regardless of your capacity or opportunity to adapt or to reduce your emissions, you will cop it anyway.

The coalition's position is: why not work with those best placed to achieve abatements? Why not work with those able to reduce their emissions at least cost and provide some incentives for them to do so? So I say to this government: you stooged the electorate, but they are a wake-up to you guys. They know that you are not competent even at putting foil and fluff into the rooves of houses. How on earth can they have confidence in you implementing what your own side boasts will be a gargantuan change to the way we live and to our economy? And they think that you guys can get this right! I don't think so and many in the electorate don't. So I ask the government and the government members: why don't you do what you said you would do? Why don't you honour your promise to the Australian public? Why don't you make sure there is no carbon tax under the government the Prime Minister leads? (Time expired)

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

I am delighted to follow my colleague the shadow minister for small business who made such a strong and powerful contribution to this debate. It is disappointing that the Labor Party seems to have given up trying to defend its package of clean energy bills. Either the powers that be thought that their members were not up to the debate or they simply ran out of people who had something to say. But there is plenty to say about these bills. There is plenty to say about the carbon tax.

I almost felt sorry for the Prime Minister today. She is so dejected because she knows she is for the chop. But I thought, 'No, the pity that I have must be for the Australian people because they are the ones who are to be punished by this legislation.' And punishment is what those opposite are about. The whole concept of compensation is that first you injure somebody and then you compensate them. This government says on its modelling—its wonderful modelling, which has still not been released and not been properly done on the $23 a tonne it is going to impose—it is going to injure the average family $9.90 a week. That is the extent of the damage it says the average family will suffer. So it is going to compensate for that damage $10.10 a week. Anybody who thinks that Treasury can accurately model down to the last 20c truly believes there are fairies at the bottom of the garden. Every year Treasury gets it wrong with the budget. The figures are always wrong. Six months later we bring in supplementary estimates to correct the errors that were committed in the budget. To believe that Treasury could say, 'We are going to injure you $9.90 and compensate you $10.10,' and get that right, as I said, is to believe there are fairies at the bottom of the garden.

The injury that is going to be done to the country is because of the way in which Labor always goes about governing. When Paul Keating was defeated he left a debt behind of $96 billion. It took us 10 years to pay it off, but pay it off we did. We left the country in really good shape. We left a surplus of $20 billion. We had set up various trust funds. We had set up the Future Fund. Now I hear this government is even going to raid the Future Fund. Nothing is sacrosanct.

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

You know that's not true.

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

I know it is true. The fact of the matter is that it is in their DNA. It is usually tax and spend, but this time it is the other way round—it is spend and tax. We are now nearly $100 billion in debt again. That is net debt. It is getting close to $200 billion gross debt. When they took office the borrowing limit was $75 billion. It went up to $200 billion and it is headed for $250 billion. Instead of having a situation where we are in good shape to face what might be a second financial crisis in the world, the waste and pillage of that legacy that we left means they have left us vulnerable; hence, they want a new tax. But the problem is they cannot even get this one right.

They say they are actually planning to spend $4.3 billion more than they are going to raise by the tax over the forward estimates. They going to bring $2.9 billion of that forward into this current financial year. Where are they going to find the money? They are going to borrow it. They are borrowing $135 million a day. That is why they want a great big new tax on everything—and it is a great big new tax on everything. It is a cascading and compounding tax, which will get into the nook and cranny of every individual's life.

We remember with the GST when John Howard said there would never be a GST. He changed his mind. He took it to an election. He was elected and the GST replaced an abolished tax. The wholesale sales tax was abolished. The GST replaced that tax. The GST is a value added tax, which means that, although the tax is paid on every transaction between the origin of the good or service and its final consumption, it is refunded at every level so that only the final consumer actually pays the tax. But with this carbon tax, which is a tax on electricity, the tax will be paid at every transaction level and you will pay tax on the tax and a tax on the tax on the tax because it cascades and compounds so that the consumer pays a very high tax indeed.

The way it works is this: the cheapest form of electricity you can have in the world bar none comes from coal fired power stations. Ninety per cent of power on the eastern seaboard comes from coal fired power stations, 80 per cent across Australia. The government is going to put a punitive levy, tariff, burden—call it what you will—on the market price of coal. The price the market has set, which is cheaper than anything else, will have an artificial impost on it to make it more expensive so that other forms of energy source can compete. That is distorting the market, not having a market price. It then means that electricity costs rise.

Electricity touches everything we do, whether it is the clock ticking away leaving me a minute and a bit still to speak, whether it is the exit sign light over there, whether it is the trains that run, whether it is the sewerage system or whether it is our water system. Whatever it is, electricity drives it. That is the mark of a civilised society. This tax will be on everything that it does. Therefore the cost of food will rise because of the refrigeration costs and because of the costs of having trucks bring it. The Prime Minister has said there will be exemptions. There will not. Even the family car when you are filling up, which is supposed to not be affected, will be affected. What do they think keeps the lights on in the petrol station? How do you think you pump the fuel out of the tanks? Electricity. Everything will be touched and it impacts dramatically most on seniors. It does so because they are the people who are on fixed incomes. Debate interrupted.