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

I move:

That the Senate condemns the Labor Government for imposing the world's biggest carbon tax on the Australian economy at the worst possible time, when the Prime Minister (Ms Gillard) promised before the 2010 election that there would be no carbon tax under a government she leads and when it will:

  (a)   push up the cost of living;

  (b)   push up the cost of doing business;

  (c)   make Australia less competitive internationally;

  (d)   cost jobs;

  (e)   result in lower real wages and cause a cumulative reduction in Australia's gross domestic product in the order of $1 trillion between now and 2050, according to the Government's own Treasury modelling; and

  (f)   shift economic activity and emissions overseas, therefore doing nothing to help reduce global emissions.

In about 10 days from now, the people of Australia will be hit with the world's biggest carbon tax. It is a carbon tax that, before the last election, our Prime Minister, Ms Gillard, promised the people of Australia in the most emphatic way they would not get. No Australian should forget that time when the Prime Minister looked down the barrel of a camera and said, 'There will be no carbon tax under the government I lead.' We need to remember that the Prime Minister made that most emphatic pre-election commitment, in the shadow of an election that was going to be difficult for her to win, because she knew that unless she provided that absolute, emphatic guarantee the chances were that she would lose the support of the Australian people and be unable to form a government.

We have to remind ourselves that Kevin Rudd went to the 2007 election promising that he would sign Kyoto and that he would introduce an emissions trading scheme. Over a three-year period we had a pretty intense and robust debate about whether or not imposing a carbon pollution reduction scheme—imposing a price on carbon—would be an effective way of helping to reduce global greenhouse gas emissions. The conclusion at the end of that robust debate, the conclusion after a number of parliamentary inquiries, including some very good inquiries conducted by the Senate, was that, no, putting a price on carbon when our trade competitors were not likely to go down the same path, now or in the foreseeable future, would not be a sensible way for Australia to go. It is not only people on this side of the chamber who came to that conclusion. Ms Gillard and Mr Swan, our current Prime Minister and Treasurer, walked up to then Prime Minister Rudd, to the great disappointment of Senator Wong, who is in the chamber, and said to him, 'Don't go ahead with this. It is not a good idea for you to press ahead with this carbon pollution reduction scheme when there are significant economic clouds on the global horizon. This is the worst time to introduce this sort of scheme. Don't do it; scrap the thing.' Of course, Mr Rudd had been on Q&A, telling all the world about the engagement that he had with his then Deputy Prime Minister and the Treasurer. People across Australia as they went to the ballot box at the last election knew that Ms Gillard had said to Mr Rudd: 'Don't proceed with this carbon pollution reduction scheme; scrap this price on carbon.' They knew that Ms Gillard had given a most emphatic pre-election commitment that there would be no carbon tax under the government she led, only to find after the election that they were going to have a carbon tax from 1 July 2012. The people of Australia are entitled to feel absolutely deceived and lied to by this government. They are entitled to punish this bad government at the next election because of that deception.

The Prime Minister's promise that there would be no carbon tax is not the only lie at the centre of this tax. The Prime Minister wants the Australian people to believe that, somehow, a carbon tax will help to reduce global greenhouse gas emissions. Imposing this tax will push up the cost of electricity, the cost of gas, the cost of living and the cost of doing business in Australia. It will make us less competitive internationally and will shift economic activity and jobs overseas into countries where, for the same amount of economic output, emissions will be higher than if that economic activity had occurred in Australia. The people of Australia know that this tax will impose economic sacrifices in Australia and be bad for household budgets and the federal budget but will not actually do anything to help global greenhouse gas emissions, because it is a tax that will take emissions from Australia and shift them to other parts of the world where those emissions will be higher arguably than if that economic activity had happened in Australia.

The verdict was in pretty well immediately. The Australian people were quite insightful post the announcement of a carbon tax by Prime Minister Gillard with the then de facto Deputy Prime Minister, former Senator Bob Brown, who got himself out of this chamber just in time, before the carbon tax hits the Australian people on 1 July 2012. The verdict from the Australian people was as emphatic as the Prime Minister's pre-election promise that there would be no carbon tax. The public verdict was that Australians do not want this tax. Overwhelmingly, people across Australia sent a very strong message to the Prime Minister that they do not want this carbon tax that will push up the cost of living and the cost of doing business, make us less competitive internationally, cost jobs, lead to lower real wages, according to the Treasury's own modelling, and take about $1 trillion in cumulative economic growth out of the economy between now and 2050. We do not want it, particularly because it will not do anything for the environment.

Faced with an overwhelming backlash against this fundamental breach of faith, what did the Prime Minister say?

The Prime Minister said to her backbench and to the Australian people: 'Don't you worry—as soon as we have explained the compensation, as soon as we have explained the transitional detail, people will like this tax. People will understand it's not that bad. People will understand that this is actually a good thing. Even though I promised people before the election that there would be no carbon tax under the government I lead, people will see the light and they will say a carbon tax was what they always wanted. People will come back in their droves and support the Labor Party that has been complicit in this fundamental breach of faith with the Australian people.' When that did not happen, the Prime Minister said: 'Don't you worry. What I'll do after the parliament rises in July 2011 is I will wear out my shoe leather. I will go up and down every single main street. I will go up and down every single shopping centre. I will explain to the Australian people what a wonderful tax this carbon tax is.'

Guess what? People still did not like it. In fact, the more they heard about it the less they liked it. Now the Prime Minister is telling us: 'You know what? On 1 July 2012, when the Australian people realise the sky has not fallen in, people will love the carbon tax.' All of the people on the Labor side have now put their hope into the idea that people across Australia will pass judgment on the success or failure of the carbon tax on 1 July 2012 and forget from 2 July 2012 onwards that this is a tax which will continue to push up the cost of living, which will continue to push up the cost of doing business in Australia, which will continue to make us less competitive internationally as it imposes a cost on business in Australia that is not faced by most of our competitors in other parts of the world. They just hope that, from 2 July 2012 onwards, people will forget all about it because on 1 July 2012 the sky did not fall in.

Of course the sky is not going to fall in on 1 July 2012. This is just political trickery by the Labor Party. They are trying to lower expectations such that as long as we are still alive, as long as the sky does not fall in on 1 July 2012, the carbon tax is a great success. 'It's a fantastic success! Isn't it great? The sky has not fallen in.' This is what you call expectations management, I guess, in politics. It is about setting the bar very low. We on this side of the parliament have higher aspirations for Australia and for our economy than to create a situation where at least the sky has not fallen in. We have higher aspirations on this side of the parliament.

When I say that people on the Labor side are pinning their hopes that this time around the Prime Minister will actually be right when she has been wrong before, that this time around people across Australia will flock back to the Labor Party because they will see what they did not see before, that this carbon tax is the best thing since sliced bread, that is not entirely true. Increasingly, people in the Labor Party are telling us on and off the record that they think the carbon tax should be watered down, that it should be scrapped, that it should be moved into a floating price more quickly. We have had a plethora of different positions out there from the Labor Party. Kristina Keneally says that it should be scrapped altogether. People who are briefing out of cabinet say that if Mr Rudd came back as Prime Minister they would water it down, they would reduce the price or they would make it a floating price. I assume, Mr Acting Deputy President Cameron, given that you were part of the Rudd team back in February and March 2012, that you are in the school that wants to water the carbon tax down and move it into a floating price more quickly. But you might be able to—