Jenny McAllister (NSW, Australian Labor Party, Assistant Minister for Climate Change and Energy) Share this | Hansard source

I was speaking about the commitments made by your government, Mr Hunt, at the National Press Club, and it is immediately relevant because the mechanism before us has very similar objectives and uses the same mechanism as was proposed by the government. The original rules in 2015 set up a framework for all new entrants from 2020 to be given best-practice baselines. Again, it's quite similar to what's before us now. The explanatory statement for that rule promised to make the first tranche of best-practice benchmarks by 31 December 2016. Unfortunately, as was so frequently the case with the previous government—there were a lot of promises—that promise, the promise to make the first tranche of best-practice benchmarks by 31 December 2016, was not met when they left office last May, in 2022.

So, the suggestion that your government never intended the safeguard mechanism to reduce emissions is false, or at least doesn't reflect what the ministers responsible for the legislation promised. It might be the view more broadly of those on your side of the chamber, and I think that was one of the challenges for the last government, wasn't it—that you weren't able to obtain agreement amongst yourselves about what to do, let alone bring a coherent policy to industry or the parliament. It brings us back to that question of engagement and consultation, because this government does want to work with stakeholders and with the parliament to establish policies that give businesses the certainty they require.

Senator Duniam, over the course of the debate you've made a series of assertions about cost, and I've indicated to you the processes the government went through to develop this mechanism in a way that minimised cost impacts and gave businesses maximum flexibility to mitigate any impacts of the mechanism. I make the point again that the mechanism we propose backs in businesses' existing commitments. Most are already planning for or pricing in the transition to net zero—already doing it. So, your assertion about additional costs doesn't reflect the fact that these businesses were already engaged in a process. Around 170 facilities, or 80 per cent of safeguard facilities, are covered by corporate net zero commitments and, given that they have made those commitments, we can anticipate that responsible businesses have been working towards them. It was 86 per cent of scheme emissions.

I can point you to some of the public research. The Grattan Institute indicated that direct impacts on household electricity, gas and petrol prices are likely to be negligible. And I point you, again, to your repeated assertion that you're interested in technology, not taxes. Well, we are interested in using the mechanism you established for the purposes you said it was established for.

The proposed reforms are carefully designed to moderate and mitigate cost impacts. The hybrid approach to setting baselines moderates initial scheme impacts while encouraging production to occur where it's lease emissions-intensive, lowering the overall economy-wide cost. The flexible compliance options, which I've spoken about previously, including borrowing, multiyear monitoring and the use of domestic offsets, helps safeguard facilities to meet their obligations at a lower cost. As we discussed last night, assistance will be available to ensure that businesses are not competitively disadvantaged, including the Powering the Regions Fund, which will assist businesses by supporting decarbonisation activities. There is also tailored assistance for emissions-intensive trade exposed facilities.

Senator, we are at a point in the debate where senators are asking questions that have previously been asked and answered. There is a motion before the chair, and obviously at any time the Senate is free to deal with it.