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

Today we mark the anniversary of the Prime Minister's carbon tax lie. Today we mark the anniversary of the Prime Minister's broken promise, which she solemnly and emphatically made on 16 August 2010 in the shadow of a difficult election that was just five days away and that she knew she was at serious risk of losing. Five days before the last election, when the Prime Minister knew she was in trouble, the hollow men in her office and the spin doctors at Sussex Street in Sydney and around Australia were telling her, 'Unless you make an emphatic promise that there will be no carbon tax under a government you lead, chances are that our government will be history and you will no longer be Prime Minister come 22 August.' The only reason the Prime Minister looked down the barrel of that camera and talked directly to the Australian people, five days before the last election, is that she knew that she had to rule out a carbon tax otherwise she was not going to be Prime Minister for more than another five days.

The carbon tax is a bad tax based on a lie. It is a broken promise and it is a policy we oppose, firstly because it is a broken promise, but also because it is bad policy for Australia. The carbon tax is bad for household budgets, it is bad for the economy and it is no good for the environment either. The lie continues, because the Prime Minister tells us that the whole point of the carbon tax is to reduce global greenhouse gas emissions. She tells us that somehow this carbon tax package will help Australia make a contribution to reducing global greenhouse gas emissions. But, of course, it will not do anything of the sort. The lie continues to this day.

The carbon tax will push up the cost of everything, it will make Australia less competitive internationally, it will cost jobs and it will hurt small business, and all of that without doing anything to help reduce global greenhouse gas emissions. It will make overseas emitters more competitive than even the most environmentally efficient equivalent businesses in Australia. Helping overseas emitters to take market share away from businesses in Australia is not effective action on climate change; it is a reckless and irresponsible act of economic self-harm.

I note that we have a senator from Tasmania in the chamber with us. I have travelled around Australia over the past five or six weeks, including to an aluminium smelter in Bell Bay, in the seat of Bass. I am sure that Senator Polley well knows which company I am talking about. It is a company that over the past 20 years has done much to reduce global greenhouse gas emissions. It has done much to reduce its energy intensity. It has done much to reduce the emissions it produces. In fact, as Senator Polley would know, as a manufacturing business in the great state of Tasmania it draws most of its energy from hydro. I see Senator Polley is nodding, so she agrees with me.

But, do you know what will happen with this carbon tax? Aluminium smelters in China will become more competitive than the aluminium smelter in Bell Bay, near Launceston. Aluminium smelters in China will take market share from the aluminium smelter in Tasmania. That is what they have told us. I see that Senator Polley is now shaking her head, so she no longer agrees. But I know for a fact that the Assistant Treasurer, Bill Shorten, was there meeting with the good people at the aluminium smelter on the same day I was there. We were both told that in this current economic environment, where they are right on the edge in terms of international com­petitiveness—given the strength of the Australian dollar and given the state of the economy internationally, generally—that this carbon tax will seriously undermine and put further pressure on their international competitiveness position. They told that to representatives from the government as well as representatives from the Liberal-National party. They have said that this carbon tax will help businesses in China, who would be more polluting, to take market share from that particular business in Tasmania. That is not effective action on climate change. As a US congressman observed, this is more akin to an act of unilateral economic dis­armament.

I will go through some of the lies that are still being perpetrated now. I just talked about emitters in China. Manufacturing businesses in China cannot wait for this carbon tax to come into place. They know this will help them take market share from Australian manufacturing businesses. The Prime Minister, the Minister for Climate Change and Energy Efficiency, the Treasurer and others keep talking about how we are somehow going to reduce emissions by sending business overseas. But reducing emissions in Australia in a way that increases them by more in other parts of the world does not do anything for the environment; it actually leaves the world worse off environ­mentally. People here in Australia have been asked to make a sacrifice. Their jobs have been put at risk. They have been asked to pay more for their electricity, they have been asked to pay more for their gas and they have been asked to pay more for their household goods, and what for? Only to shift emissions to other parts of the world.

Let us just have a look at the impact that this carbon tax will have on emissions. Emissions in Australia are going to continue to go up. At present, according to the information that was released as part of the package, we put out levels of about 578 million tonnes of CO2 emissions in Australia in 2009-10. Under the core policy scenario, by 2020 our domestic emissions will be 621 million tonnes. Now emissions are continuing to go up. So the government says: 'Don't worry about that. They'll be lower than they otherwise would be. The reason we can say emissions are going down is that without a carbon tax they would go up by more. They're not going to go up by quite as much.'

Let us look at that argument. We turn around and say, 'What is going to be the impact on jobs?' We are told that jobs will continue to grow. The economy is going to continue to grow. But hang on: economic growth is going to be lower. There are going to be fewer jobs, and the government is saying that there is not going to be an impact of the carbon tax. When it comes to jobs, when it comes to the economy, you have to compare things with current levels. Compared with current levels, supposedly jobs are still going to go up, even though they are going to be lower than they otherwise would be. When it comes to emissions you cannot compare with current levels; you have to compare with what the situation would have been. You have to decide. If you say that emissions are going down just because they are going to be lower than they otherwise would have been, then you have to admit that jobs are going to go down as well—and of course the Treasury modelling assumes that real wages are going to go down.

Let us look at the impact on emissions globally. Only three years ago Treasury did what they said was the most comprehensive modelling ever done on anything to do with carbon pollution and so on. They assumed then that China, in 2020, would put out 16.1 billion tonnes of emissions. Three years later, they have revised their modelling. Now they think China will put out 17.9 billion tonnes of emissions by 2020. So just by having revised their expectations, they now think that Chinese emissions are going to be 1.8 billion tonnes higher in 2020 than what they thought three years ago. That is more than three times—