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

My question is to the Minister representing the Minister for Climate Change and Energy Efficiency, Senator Wong. Could the minister explain why the government has exempted petrol but not electricity from its carbon tax even though electricity is a critically important service for families and businesses and is responsible for significant cost-of-living pressures?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

I am sure the senator would be aware that I have said previously in this place that the details of the package will be announced on Sunday.

Honourable Senators:

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Senator Wong, ignore the interjections; they are disorderly.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

I am interested that Senator Cormann has asked me about taxing petrol, because I was surprised to find his comments in the chamber, in September 2007, where he said of Mr Howard's emissions trading scheme: 'This will be the most comprehensive ETS, in the world, broader in coverage than any scheme currently operating anywhere; a world-leading scheme to cover 70 to 75 per cent of total emissions. By including large emitters alone, the scheme would cover 55 per cent of total emissions; however'—and this is the best bit, Mr President—'by including transport and other fuels the coverage of the scheme is significantly increased.' So Senator Cormann used to back an ETS which covered petrol.

What happened? Senator Cormann used to come into this chamber and say, 'Yes, we are going to have a great scheme.' and: 'We would have had a great scheme under Mr Howard. We would have had a scheme that covered 70 to 75 per cent of total emissions, including transport and other fuels.' So when Senator Cormann stands up in here and tries to play a bit of politics with the carbon price, one might recall that in this chamber he previously supported an emissions trading scheme with wide coverage, including transport and other fuels. People can judge the legitimacy of his question knowing that background.

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Just wait a minute, Senator Cormann. You are entitled to be heard in silence.

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

Mr President, I ask a supplementary question. Clearly, unlike former Prime Minister Kevin Rudd, the minister did not understand that Copenhagen was one big failure. Can the minister explain why the government considers that carbon emissions from coal are more harmful than carbon emissions from petrol?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

The government has made very clear its view about the importance of pricing pollution, and the reason we want to price pollution is so we start reducing it, because—and this is pretty intuitive—as long as something is free, it will keep occurring. And as long as polluting is free, businesses—

Opposition Senators:

Opposition senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Senator Wong, resume your seat. Senator Wong, continue.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

The reason we want to price pollution is that, unless we put a price on it, we will keep polluting. The whole point of pricing pollution is to give an incentive to pollute less, to invest in clean energy and to tackle climate change. It is true that we have to work through how you transition a very highly carbon-intensive economy like Australia to a low-polluting economy. As we have taken this policy forward, the Australian people will have seen that we have been very focused on how we do this efficiently, effectively and at lowest cost.

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

Mr President, I ask a further supplementary question. The Prime Minister said that there will be no carbon tax on petrol under the government she leads, because people in outer suburban areas have no choice other than to use petrol. Given evidence that, irrespective of a carbon tax, the main electricity generator in Western Australia, Verve Energy, will not have any choice but to use more coal to generate all the necessary electricity to ensure Western Australia's energy security, can the minister explain why the government would impose a carbon tax on electricity generation when all it does is push up the cost of electricity without doing anything to reduce global emissions?

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

Just like Colin Barnett!

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Minister Wong, when we have silence on both sides.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

As Senator Cormann is so keen to quote things that were said in the past, he might like to recall this statement:

The government's recent announcement of a national emissions trading scheme, including offsets for trade exposed industries, is a positive and sensible approach ...

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

Mr President, on a point of order: as flattered as I am that the minister is reading my first speech in this parliament—

Government senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Order! Senator Cormann is entitled to be heard in silence.

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

My point of order is in relation to the requirement for the minister to be directly relevant to the question. There was a very specific question: why would the government impose a carbon tax on electricity generators like Verve Energy in Western Australia when it will do nothing to reduce global greenhouse gas emissions because Verve will continue to use coal in order to ensure energy security in WA? The minister can quote my speeches from four years ago—and I am flattered that she reads them—but it is not directly relevant to the question.

John Hogg (President) Share this | Link to this | Hansard source

Senator Cormann, you are now debating the issue. Senator Evans.

Chris Evans (WA, Australian Labor Party, Leader of the Government in the Senate) Share this | Link to this | Hansard source

Mr President, I would just make the point that having a glass jaw does not mean there is a point of order.

John Hogg (President) Share this | Link to this | Hansard source

The minister has 41 seconds remaining in which to answer the question. Minister Wong.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

As I was saying, Senator Cormann has previously described an emissions trading scheme as 'a positive and sensible approach to addressing global warming'. I assume the reason he supported it at the time was that, as we know, putting a price on pollution is the most economically efficient way to ensure we reduce our pollution and shift to a lower carbon economy.

Honourable senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Senator Wong, resume your seat. It is very hard to hear the answer because of the interjections from both sides. It is not much use asking for me to listen to the answer when you continue to interject. Minister, you have 16 seconds remaining to answer the question.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

Thank you, Mr President. The point I was seeking to make is that I suspect the reasons why Senator Cormann used to support putting a price on carbon are the same reasons why this government and this Prime Minister want to put a price on carbon and put a price on pollution and why we believe it is in the national interest. (Time expired)