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

My question is to the Prime Minister. I remind the Prime Minister of an Energy Users Association report out today showing that Australian electricity prices are 70 per cent higher than in the United States and 130 per cent higher than in Canada. Why is the government adding the world's biggest carbon tax to the world's highest electricity prices?

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I thank the Leader of the Opposition for his question. I am aware of the report, and of course I am aware that many Australian families struggle to make ends meet and certainly feel the pressure when the electricity bill comes in. It is important that Australian families be clear about the causes of rising electricity prices. The truth is that we have seen over decades and decades underinvestment in the capital necessary for our electricity systems, and that means that we are now seeing catch-up investment with all of the costs that come with that catch-up investment. The fact that this exists as a pressure on electricity prices has been acknowledged by all sides of politics. I do note, for example, that the member for Groom acknowledged this when he said that power prices were set to double over the next five to seven years, irrespective of who was in government—lack of planning had led to an investment drought. He also said:

Australians in all states are feeling the impacts of rising power prices, in large part due to the neglect and mismanagement of State Governments.

I know on all sides of politics there has been an acknowledgement of power rises and that, for example, the Premier of Western Australia, Colin Barnett, apologised to the people of Western Australia for increasing electricity charges by as much as 50 per cent. He said:

That was a difficult decision. I knew it was the right decision … I apologise for it for the hurt. But we had to do it.

That was an acknowledgement of the pressures that exist as a result of underinvestment in electricity generation and electricity supply due to, I would say, some severe neglect by state governments.

In respect of carbon pricing, which comes into effect on 1 July, of course Australians around the nation will see assistance for an average family of more than $500 a year. There will be tax cuts, increases in family payments and increases in pensions. There will be that money on hand to assist people and, as we know in this parliament, the threat to Australians having and retaining that money is the Leader of the Opposition.

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

Mr Speaker, I ask a supplementary question. Does the Prime Minister accept the Energy Users Association view that the carbon tax will make a bad situation worse by adding 20 per cent to what are already the world's highest electricity prices?

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

Of course what I accept is the analysis of Treasury about the impacts for households, and as a result of that analysis we are providing the money I have just spoken about in the form of tax cuts and pension increases and family payment increases. But the Leader of the Opposition is obviously very interested in the words of the Energy Supply Association of Australia. What they have said is that uncertainty over carbon pricing—that is, the reckless scare campaign of the Leader of the Opposition and his very futile promises to remove carbon pricing; something he will in fact never do—is having an impact on electricity. The Energy Supply Association have said:

We're concerned that if there is any uncertainty around a future price of carbon it will affect the ability for electricity generators to invest. And that it will also impact on their ability to offer—

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

Mr Speaker, I rise on a point of order which goes to direct relevance. I asked about the Energy Users Association, not the Energy Supply Association. This is about the people who use power, the Australian public, who are being—

Peter Slipper (Speaker) Share this | Link to this | Hansard source

The Prime Minister has the call to answer the supplementary question.

Julia Gillard (Lalor, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I am addressing issues about electricity pricing. The Leader of the Opposition professes concern but does not want to deal with the facts out of the Treasury modelling. He professes concern but he wants to rip assistance out of the hands of working Australians. He professes concern but he does not acknowledge that the uncertainty that he is creating is also bad for electricity supply, bad for pricing and bad for Australian families. The Leader of the Opposition ought to acknowledge that.