Christine Milne (Tasmania, Australian Greens) Share this | Hansard source

Before the dinner break I stood to address the Tax Laws Amendment (2008 Measures No. 1) Bill 2008 and the issue of what was schedule 3 and which will now be the subject of my new amendment for proposed schedule 7. If rural Australia was already worried about managed investment schemes then it should also be worried about this legislation, which is about managed investment schemes on steroids. That is the only way I can describe it.

Let me explain again why this is such a bad idea. It is supposedly to establish forests that will be of long-term use in absorbing excess carbon dioxide from the atmosphere. The Bills Digest says in its conclusions:

... the proposed deduction encourages the rapid establishment of these forests during the next few years.

That means the rapid establishment of plantations—yet more plantations on the backs of taxpayers and, in forgone revenue, they are going to cost $25.3 million in the forthcoming three years. This is the National Association of Forest Industries getting yet another major boost for plantation establishment around the country and starting up yet another whole raft of managed investment scheme types of companies, which will be out there getting 100 per cent tax-deductibility in the first year for establishing plantations.

As I said before, there is no requirement for these plantations to be biodiverse. There is no requirement for a hydrological study to look at the impact of these plantations on catchments, yet we already know that plantations are drying up catchments and destroying the water supplies of many towns around Australia. There is no requirement to look at the impact on existing land uses. As I mentioned earlier, the cane growers in Tully are a classic case. Well, on the north-west coast of Tasmania we are taking good food-growing land out of food production and putting it towards plantations, not because it is justified but so Collins Street investors can get up-front tax deductions to minimise their own incomes and maximise their own wealth, at the cost of food production and at the cost of local farmers.

Why is this the case? What is so horribly wrong with this? First of all, the federal government is meant to be taking a whole-of-government approach to climate change. This is a taxation measure which in theory ought to be assisting, not undermining, the effort on climate change. Why isn’t it? The reason is this. The IPCC report shows that, on all the science analysis, climate change is getting worse by the minute. We have not even until 2015 to significantly reduce our emissions. Bali’s starting negotiation point was 25 to 40 per cent reductions below 1990 levels by 2020. So the aim of the exercise should be to maximise the carbon store we have now got in the ground and keep it there and protect it, because we have huge volumes of carbon in our standing native forests, and in our savannahs and in our native vegetation around the country. If we subsidise the knocking down of those forests, we are putting into the atmosphere millions of tonnes of carbon dioxide. On the other side of the ledger, if we then give tax-deductibility for these schemes to plant plantations, it will take up to a hundred years, if those plantations survive, for us to be able to store as much carbon as can be stored in the forests that we are currently knocking down. And we do not have 80 to 100 years—we have only until 2015 at the maximum—to reduce these carbon dioxide emissions.

The problem with this whole legislation is it is based on Kyoto accounting. By that I mean that what we get credit for is afforestation and reforestation—that is, planting so-called forests, being plantations, on land that was cleared before 1990—but we do not get penalised for the emissions that we put into the atmosphere from the logging of forests. So all of those forests in Tasmania that are being logged, those dense old-growth forests, are regarded as being neutral for the purposes of Kyoto accounting, because, as long as the land use does not change and as long as you put in a plantation on private land or you regenerate on public land, it is regarded as neutral, because over hundreds of years it would be. But we are not doing this over hundreds of years. We do not have hundreds of years. So it is complete madness to give out taxpayers’ money to knock down carbon stores and put hundreds of millions of tonnes into the atmosphere and then give tax deductions to try to take a small fraction of those out of the atmosphere in the next 10 years. But that is what the government is doing.

What the minister has to explain here tonight is why the government is giving a tax deduction for planting plantations that are not biodiverse and are not required to be in the ground for any length of time and is providing subsidies to knock down carbon stores. If there were a whole-of-government approach the first thing you would do to reduce your emissions would be to protect your carbon stores by protecting your native vegetation. If you were going to go for establishing carbon sinks you would look at restoration forestry in areas that have been degraded and, again, look at building up mixed species. You would look at protecting more standing forest rather than displacing people off farms. Furthermore, this is yet another example of the destruction of the integrity—if there ever will be any in the end—of a supposed emissions-trading scheme. Instead of making the coal industry, in particular the coal-fired electricity generators, compete on an even playing field, you are giving them a tax deduction to go out and plant plantations in order to offset their emissions, rather than forcing them to reduce their emissions at the power station. There is no attempt by the government to do that by forcing them to implement the easiest energy efficiency opportunities which they are forced to identify but not forced to implement.

Today’s Greenhouse Gas Inventory clearly makes this point: transport emissions are going up, energy generation emissions are on the way up, fugitive emissions from coalmining are on the way up and coal accounts for 70 per cent of the increase in our emissions. And what is this bill doing? It is saying to rush out and plant out rural Australia with plantations to try to mop it all up, rather than saying: deal with the issue at the source. But, even more ridiculously, it is about subsidising more emissions into the atmosphere from logging than will be absorbed from these plantations for which you are driving the farmers of Australia off their land to actually establish.

I would like to know from the minister what the justification is for there being no time frame in this legislation requiring the length of time for these so-called forests to be in the ground. What is the justification for them not being mixed species—local native mixed species? What is the justification for no hydrological assessment and no assessment of the impacts on existing industries in that area—whether it is dairies, cane or whatever else? Rural Australia is already up in arms. And it is no use Senator Boswell rushing around Queensland saying, ‘Oh dear, the MISs have been terrible for cane,’ because he is about to vote for something that will be worse. It will make the situation far worse.

I am really appalled by the fact that, if the plantation that you plant burns down in a bushfire, not only do you not have to make good—you do not have to pay back the tax deduction you got for establishing it—but you get the rest of your tax deduction paid out, plus a bonus, plus your insurance money. So there are no worries! You can get a 100 per cent tax deduction up front or you can take it over 14 years, which is coincidentally the life of a plantation. And, if it burns down after eight years, you get the tax deduction paid out up to the eight years, plus a bonus, plus your insurance. This is yet another mechanism for investors to make money out of the government—and it will be $24.3 million out of the government—minimise their incomes, invest in reducing their own mortgages or whatever, drive farmers off the land and do nothing for climate change.

There will be a net loss of carbon, as there is right now, and the only reason forestry pretends there is not is that there is not yet full carbon accounting. Native forest logging is regarded as neutral and, until we get proper accounting, we will have this distorted, ridiculous pretence about the level of emissions coming out of the forest sector in Australia. I foreshadow that I have amendments which will require mixed species, which will require the trees to be in the ground a hundred years and which will require information on hydrological and other ecological impacts as well as impacts on surrounding land uses. As I said before, I would have been voting against this schedule but, in what can only be seen as a sleight of hand, the government switched the schedules. (Time expired)