Simon Birmingham (SA, Liberal Party, Shadow Parliamentary Secretary for the Murray Darling Basin) Share this | Hansard source

by leave—I move:

That the Senate take note of the statement.

I rise to speak once more, as many have in this House, on the Home Insulation Program—the topic of the ministerial statement given yesterday by the Minister Assisting the Minister for Climate Change, Mr Combet. It was given almost at the same time as the Minister for Climate Change, Energy Efficiency and Water, Senator Wong, herself was making a ministerial statement in this place in relation to the green loans saga. As I said yesterday when taking note of that ministerial statement, it was transparently the government’s ‘air the dirty laundry’ afternoon. With all of the other things happening in Canberra yesterday, with the visit of the Indonesian President and otherwise, the government decided it was a good time to get all the dirt out—to wheel it out. So we had the spectacle of Senator Wong and Minister Combet both on their feet in both chambers at the same time making full confessionals, as it were, on behalf of the government about the manifest failures in the programs that Peter Garrett, then the Minister for the Environment, Heritage and the Arts, was responsible for administering on behalf of the government.

These two programs—the Home Insulation Program and the Green Loans Program—together are worth billions of taxpayer dollars, together involve hundreds of thousands of Australians and together are a failure and a disaster on every score that anybody could consider. They are a failure and a disaster not least of all because in both instances there were warning signs for the government that it failed to heed and failed to act upon in relation to these programs. Had it heeded, had it acted upon, those warning signs, it could have averted the disasters that have occurred in both of these programs.

Specifically, the Home Insulation Program is truly a human tragedy, an economic tragedy and an environmental tragedy. Peter Garrett has truly overseen a tragedy on all three fronts in this area. The human toll has been well discussed in this place, the other place and through the media—the tragic loss of life of four young installers, house fires in at least 93 Australian homes, the potential risk to thousands more Australian homes fitted with either foil insulation or other insulation products, that homes may be at risk of electrification or indeed, following on from that, potentially at risk of fire. There are real risks, real tolls and real human tragedy in this.

We have seen, from the government’s need to bring an early halt to this program, further human tragedy which is related to economic tragedy, and that is the loss of jobs and the loss of businesses. There have been serious problems affecting real people throughout Australia—thousands of ordinary Australians. Senator Colbeck cited today some examples from Tasmania. We could all cite examples from each of our home states of people who have been put out of work as a result of the mismanagement of this program, people who are losing businesses, in many cases business that were operating long, long before the government brought about and supercharged this program with its stimulus spending last year. It is a seriously grave toll on the human front and the economic front from that loss of jobs and that loss of businesses.

But let us not forget the use of taxpayers’ money here. Around 1.1 million installations of insulation have occurred under this program at a subsidy of between $1,200 or, for most of the life of the program, $1,600. We are looking at well in excess of $1 billion that has already been spent by the government on insulation under this program. Some of it, of course, has been worth while. Some of it will be of benefit to those lucky homeowners who have had the right product installed correctly. But all too much of it either has been installed incorrectly or has been the wrong product. Indeed, in too many instances, we see that the financial mechanisms put in place to ensure that this program did not attract fraudsters were inadequate. We see homes that have been insulated do not really exist.

The government has failed to manage every aspect of this program. On the budgetary front, there is not only the wasted money that has gone before but also now the cost of the clean-up—the fix-up—and how much that is going to be. We see no evidence from the government as to what that will be. There is no idea from the government as to what the cost of that clean-up is. In his ministerial statement, Minister Combet talks about the clean-up and talks about getting it done, but there is no cost estimate. When asked in this chamber today, Minister Wong could not give any indication of a budgetary allocation towards the cost of this clean-up. All we know is that industry estimates vary. The cost of removing the foil insulation or installing electrical safety switches could be between $50 million and $150 million with industry estimates of the overall cost of the inspections and the work required to fix up this mess ranging up to $450 million—a bill that the Australian taxpayer is going to have to bear; a cost because of the mismanagement of this program and a cost that comes on top of the $1 billion-plus spent on this program to start with. This is massive waste of taxpayers’ money and, indeed, is a massive budgetary and economic tragedy.

Lastly, it is an environmental tragedy because of the loss of confidence that has occurred from the damage to reputable businesses that were doing the right thing in trying to install product that had an environmental benefit. There is the loss of confidence that has occurred among investors who might have thought about going into this industry and providing environmental benefits. There is the loss of confidence that has occurred from homeowners in terms of getting insulation into their homes. It is a massive loss of confidence across the board in pursuing the type of environmental outcomes that the government said this program was about when it started.

Today, we learn that there could be further environmental negatives flowing from the clean-up of this program. The government, in saying that it is going to take foil insulation out of potentially 50,300 homes, has no idea of what it will do with that foil insulation. It has no idea whether it will end up in landfill or where it will go. I do not know how much energy goes into manufacturing foil insulation, but I imagine that it is not insubstantial. I imagine that a reasonable amount of energy goes into manufacturing foil insulation. I imagine that it comes with a reasonable carbon footprint when installed, with the aim, of course, that it then repays that and more over its life. If it is ripped out within months of being installed and put into landfill, that is energy and economic, financial and environmental resources wasted by this government. It is a waste of resources for the economy. It is also a waste of human and environmental capital.

The government says that it stands by the ministerial statements it made yesterday in regard to the clean-up for this program and the fix-up for the Green Loans Program. Those ministerial statements are fine. They are welcome. The government needs to act with urgency in cleaning up this mess. Today we heard Minister Arbib urging this side of the chamber to make sure that we support a new program on home insulation. They challenged us to support a new program on home insulation. I challenge the government to make sure they get a new program on home insulation right, that they get the terms of it correct, that they make sure all of the safety standards are up to scratch and that they make sure that the new program restores, as I said before, the confidence of businesses, installers and, most importantly, homeowners that they should be investing in home insulation and pursuing the environmental benefits that that offers.

There is a big task for this government. These ministerial statements make a start in laying out some of the government’s commitments, but they do not give any level of detail. The opposition will be holding the government to account for that detail. We do want to know exactly when the fix-up will start, exactly when it will be finished and exactly how much it is going to cost. We expect answers to these things over the coming weeks and, most of all, we expect the government to deliver for the Australian people by cleaning up the mess of its own making.