Matt Thistlethwaite (NSW, Australian Labor Party) Share this | Hansard source

Thank you, Madam Temporary Chairman. We can go back to the Stern review, which was the pacesetter, really, in terms of international studies and the economics associated with pricing carbon and the costs associated with delaying. That was six years ago, and we are still debating this issue here in the parliament. The Australian public is still waiting for action. Australian businesses are still waiting for action to ensure that there is certainty. Senator Cormann has questioned the minister in respect of costs associated with delay. This is an issue that Senator Cormann should be well versed in. It is an issue that has been canvassed and discussed in detail in the Senate Select Committee on the Scrutiny of New Taxes inquiry into the carbon pricing legislation, which he chaired. I think there were four occasions on which Treasury officials appeared before that committee and they underwent quite rigorous and detailed questioning from all sides, particularly on questions associated with the modelling.

I draw Senator Cormann's attention to the final report of the Scrutiny of New Taxes committee into a carbon pricing mechanism and, in particular, to the government senators' dissenting report where the issue of delay and the costs associated with that is highlighted. I also draw Senator Cormann's attention to the questioning that was undertaken during that process when Ms Quinn and other Treasury officials appeared before the committee and the issue associated with delay was put to Ms Quinn. The question was: 'Had Treasury done any analysis of the costs associated with delaying the introduction of a carbon scheme in the Australian economy?' Ms Quinn's quite detailed response illuminated the fact that there were costs for the Australian community and economy—households and businesses—associated with delaying the introduction of a carbon pricing mechanism in our economy. She said:

The analysis that we did suggests that a delay in global action by three years adds around 20 per cent to the first year of global mitigation costs and delaying entry by a further three years adds a further 30 per cent to the first year of mitigation costs. This suggests that, as you delay, the costs only get greater through time ...

This is the evidence that Treasury officials gave to Senator Cormann's committee, to the Senate, associated with the issue of delaying entry of a carbon pricing mechanism. It accords with all of the studies that have been done by economists. It accords with all of the scientific evidence. It accords with the view, I might add, that previously existed in the Liberal Party under the leadership of John Howard, the Shergold report and other inquiries—

Senator Ian Macdonald interjecting—

The TEMPORARY CHAIRMAN: Senator Thistlethwaite, I am going stop you again. Senator Macdonald, you do not have the call unless you are standing.

Senator Ian Macdonald interjecting—

The TEMPORARY CHAIRMAN: You know that is not right. Senator Thistlethwaite, try again.

Thank you, Madam Temporary Chair. It accords with all of the credible economic studies, the credible modelling—

Senator Ian Macdonald interjecting—

The TEMPORARY CHAIRMAN: Senator Macdonald, you know that you cannot interject like that across the chamber.

It accords with all of the studies that have been undertaken both internationally and domestically. It accords with the modelling that has been conducted by a number of credible modelling agencies. It accords with the government's overall view of the reasons behind this policy. It accords with the Treasury's analysis of why an emissions trading scheme and a market based mechanism is the most efficient means of reducing emissions for the least cost in our economy. Of course, it accords with that typical traditional Liberal Party philosophy that markets work efficiently, which has not been adopted by those opposite under the leadership of the Leader of the Opposition, Tony Abbott.

In all respects, Senator Cormann is aware of what the modelling shows on this issue. He is aware of the international studies which suggest that delaying the scheme increases the cost. He is aware of the fact that, if we are going to be serious about introducing a scheme that will provide incentives across the economy, we need a market based mechanism. That is borne out in the evidence of Ms Quinn to the inquiry chaired by Senator Cormann. So I find it quite amazing that we have had eight hours of debate on this issue in the committee of the whole and we are still tossing around the platitudes and the rhetoric associated with this issue. It is about time that we got onto debating the actual amendments.