Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Hansard source

For Australia to introduce a price on carbon, whether through a carbon tax or through an ETS, is bad public policy. That was the conclusion after three years of public policy debate over the past parliament. That was the conclusion that was reached indeed in the lead-up to the 2007 election by then Prime Minister John Howard, who has been quoted in vain by many contributors to debates today. I will quote what then Prime Minister John Howard said a couple of weeks before the 2007 election when the then Leader of the Opposition, Kevin Rudd, had to pull Peter Garrett into line about what was described in the Australian on 30 October 2007 as ‘Garrett’s Kyoto blunder’, ‘Reversal on targets after blunder’, ‘Rudd seeks climate control’ and so on. This is what John Howard said at the time:

We can’t have a situation where Australian industry is bound to take steps to curb greenhouse gas emissions, but competitive countries like China are not bound.

This is the crux of the debate. The emissions trading scheme debate, the debate about putting a price on carbon, changed at the time the talks in Copenhagen failed towards the end of December 2009. The Prime Minister, Julia Gillard, as then Prime Minister Kevin Rudd also realised, knew that that was the case. They knew it was no longer in the public interest for Australia to proceed with a carbon tax or an emissions trading scheme, which is why before the last election the Prime Minister made an absolute ironclad promise that there would be no carbon tax under the government she leads. And the day before the election she said, ‘I rule out a carbon tax.’ It could not be any more clear. Why did she say these things? Why did she rule out a carbon tax the day before the election? Because she knew that she had to say so in order to survive the next day at the election. She knew that the Australian people had come down on the side of coalition policy when it came to a proposal for a carbon tax or an emissions trading scheme, which is why the Prime Minister before the election promoted coalition policy on the carbon tax and emissions trading scheme, which is to be opposed to it, only to turn around after the election and adopt the policy of the Greens. I understand why Senator Farrell would leave the chamber now, because I am sure that he is embarrassed that his Prime Minister would be joining with the Greens on something like this.

But Prime Minister Gillard has got form on this. She is the Prime Minister who said back in May 2010: ‘If Stephen Spielberg rang me from Hollywood and asked me to star opposite Brad Pitt in a movie, would I do it? Well, I would be a little bit tempted but, you know what, I don’t reckon Stephen Spielberg is going to give me a call.’ That of course was her way of saying she was not going to challenge Kevin Rudd for the leadership. She said she would be more likely to go to Mars, she would be more likely to go around the world sailing solo a dozen times and she would be more likely to be the full-forward for the Bulldogs than she was to change the leadership of the Labor Party. History has shown that that was yet another occasion when this Prime Minister deceived the Australian people and of course deceived her predecessor.

Consider the sheer arrogance with which this government proceeded: on the day they passed the floods tax grab through the House of Representatives the Prime Minister went out with Senator Bob Brown of the Greens and various other people and announced the carbon tax. She must have been so excited at getting a tax through the House of Representatives that she decided this was the time to make an announcement about yet another tax, even though it was a complete breach of everything she promised to the Australian people before the election. She went off and gave the Australian people the two-finger salute.

Today we are getting sanctimonious lectures from the Labor Party on how important it is to whack yet another tax on people. We are getting lectures on how this is important economic reform. If it was such important economic reform, if it was such an important thing to do, why didn’t the Prime Minister tell the Australian people before the election that that is what she was going to do after the election? I ask this question to senators in the chamber: if this is such an important reform, if this is such an important thing to do, why did the Prime Minister not take this proposal to the cabinet and why did she not take the Labor Party caucus into her confidence and let them have their say about this important economic reform before announcing it with Greens leader Bob Brown last Thursday? Does the Prime Minister trust Greens leader Bob Brown more than she trusts her own cabinet or Labor Party caucus?

On past occasions we have heard Senator Cameron talk about there being ‘lobotomised zombies’ on this side of the parliament. This time we have not heard anything from Senator Cameron because he is quite happy that Prime Minister Gillard is cuddling up to Senator Brown. His side of the Labor Party are very comfortable with that. They want that shift to the extreme Left of Australian politics. They do not want the government to stay in the mainstream of public policy here in Australia. What has happened to the once-proud New South Wales right wing of the Labor Party? This Prime Minister has completely castrated what was once an effective political machine. This is a Prime Minister who has gone back to her socialist roots and who is now doing deals with the Greens leader before even talking to her own caucus colleagues about what everybody, from the Prime Minister down, now suggests is an important economic reform.

The reality is that this was all about political strategy not about good public policy. It was not about acting in the public interest; it was about a Prime Minister who was told—after fake Julia and real Julia—that we needed a Prime Minister who was seen to be standing for something. One of her spin doctors, maybe her new chief of staff, who recently came on board, said to her, ‘Prime Minister, your problem is that people don’t think you stand for anything, so you should pick a fight. If you pick a fight on an issue that is going to be controversial, people are going to think you actually stand for something.’ My message to the Prime Minister is that she picked the wrong fight, because what she is proposing is not in the national interest. The reason it is not in the national interest is that it is bad public policy. As I mentioned at the beginning of my speech, to put a price on carbon in Australia in the absence of an appropriately comprehensive global agreement is bad public policy. It will make our businesses less competitive than more polluting businesses overseas. It will put pressure on the price of everything—electricity, petrol, groceries—it will cost jobs and it will put pressure on the economy for no environmental benefit.

If we reduce emissions in Australia to the extent that emissions are increased in other parts of the world, we will not have achieved a thing; we will have forced people in Australia to make sacrifices for no benefit at all. I will mention two examples that are relevant to my home state of Western Australia. The emissions trading scheme, a carbon tax, will make it harder for us to maximise our opportunities through LNG production, because LNG production in Australia will result in increased emissions in Australia. Exporting LNG to China or Japan where it can displace coal is actually going to be in the world’s best interest. If we are truly focused on helping to reduce global greenhouse gas emissions then we should actually be prepared to increase emissions in Australia if that is what is required to reduce emissions in the world. There is example after example. Magnetite is a process whose whole life cycle is actually more environmentally efficient than traditional iron ore production and use. However, if you only look at the Australian process in isolation, the process at the start, and not at the whole-use cycle, including the component in China, then you will actually make it harder for a process that overall is more environmentally friendly to get off the ground. That is not in the world’s best environmental interest; but it is going to be the consequence of these sorts of decisions.

The Prime Minister made this announcement without having done any homework. She clearly was keen to have a political announcement to grab a headline and be seen to be picking a fight, but Treasury was not aware of it and was caught off guard. When we asked Treasury whether they done any new modelling since 2008, they said that no such modelling had been done. That was the modelling that assumed that the United States of America was going to have an emissions trading scheme by the end of 2010. Newsflash! The United States did not have an emissions trading scheme by the end of 2010; neither does China, which is supposed to have one by 2015; neither is India on track to have one and nor are many other countries.

This carbon tax is a blatant broken promise from an arrogant Prime Minister who is desperate to look like she stands for something. Nobody on the Labor side is standing up to this Prime Minister who is treating them with absolute contempt. You would have thought that proper due process on something as important as this involved cabinet, caucus and party room discussions. It never happened. (Time expired)