Arthur Sinodinos (NSW, Liberal Party, Assistant Treasurer) Share this | Hansard source

I thank Senator Milne for her contribution. Her contribution indicates why the government agreeing to this particular set of proposals is no free lunch for the government. As Senator Milne has demonstrated, there remain significant differences between the government and the Greens on the approaches to climate change policy, but what we do agree on is having the transparency and the debate about what the measures mean and their implications for climate change emission reduction.

The point I would make about what is happening in the United States is that going down the route of regulatory change is the very same reason why Australia is going down the route of direct action, and it is not the coalition's fault. Over time you can track this in things like the Lowy Institute Poll, with which I was associated for a number of years. What we have found is that while people remained concerned about climate change—even though that concern did reduce over time as the global financial crisis and other matters came to the fore—their willingness to put their hand in their pocket directly to pay for mitigation policies was very limited. This was the dilemma, particularly in a context where electricity prices had risen very strongly as a result of network investment, which was done with the approval of state regulatory authorities. That was the political context, for the benefit of those listening in the gallery.

So the United States has gone down the route of regulatory change and Australia is going down the route of direct action in order to try and meet the twin aspirations of the public, which are to do something about climate change while not requiring people to put their hand further in their pocket. That is the truth of the situation, that is the dilemma with which the coalition had to wrestle and that is the dilemma with which the Obama administration has had to wrestle. The greater transparency that we will have over paying for climate change will inform that debate over climate change going forward, and we are prepared to live with the consequences of that. That is why, as I said before, there is no free lunch for the government in agreeing to these particular measures.

Can I go back to a point that Senator Wong made about Peter Costello, when he talked about the debt limit being a discipline that could be used to persuade his colleagues not to increase spending beyond a certain point. Of course, he is right—you can use a limit to do that, but under Labor that limit was not used as a discipline to stop debt going up. All that happened is that people would come back to this parliament from the other side to request an increase to the limit. Every time we got close to spending the credit card limit they came back for more, rather than using it in the way that Peter Costello suggested.