John Madigan (Victoria, Democratic Labor Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Climate Change and Energy Efficiency, Senator Wong. Minister, in light of Professor Ross Garnaut's statement that the Latrobe Valley was likely to be the hardest hit area in the country, can the government explain why the Australian people should believe Treasury figures used to form its carbon tax policy when vitally important socioeconomic impact studies, such as the one the government should be commissioning for the Latrobe Valley after consistent local community protests, have been ignored and the detrimental impacts on industry and the communities have not been considered in its modelling?

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

I thank the senator for his question. I am asked about—

Honourable Senators:

Honourable senators interjecting—

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

Wait a minute, Senator Wong. Senator Madigan is entitled to hear the answer.

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

I thank Senator Madigan for his question. I am asked about, essentially, why people should believe the Treasury modelling. The government absolutely stands by the Treasury modelling. These are the finest modellers in the country. Despite the denigration that has occurred of Treasury by those opposite and in the other place—which I have to say was a new low in the debate in the other place earlier this week—these are the people who advised Prime Minister Howard, these are the people who advised Treasurer Costello and these are the people whose advice was taken by former Prime Minister Howard when he put in place a policy to impose a price on carbon.

The modelling that was originally done in 2008 was updated by the Treasury. It was one of if not the most extensive, robust and thorough exercises in economic modelling ever performed in Australia. It has stood up to scrutiny from various sources and remains one of the most well-documented, transparent and credible modelling exercises undertaken, which puts it, if I may say, in stark contrast with the Victorian state modelling which was previously released and misconstrued by the state Treasurer and the Premier, who formerly supported a price on carbon. In terms of jobs, I would remind—

Honourable senators interjecting—

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

Senator Wong, resume your set. There is only 14 minutes left before you need to descend into debate, so if you can hold off that long—

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

Ascend.

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

I said descend into debate. This is not uplifting at all during question time. The minister is entitled to be heard in silence and Senator Madigan is entitled to hear the answer.

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

The Commonwealth Treasury modelling demonstrates that we can continue to grow our economy, we can continue to grow jobs, including in Victoria, with some additional 400,000 jobs in Victoria as part of the 1.6 million to be created by 2020. (Time expired)

John Madigan (Victoria, Democratic Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. With recent media reports on the likely closure of Hazelwood power station, TRUenergy Yallourn and Energy Brix Morwell, at a loss of possibly 1,000-plus jobs, and the long-held basis that each power industry job has a multiplying effect of at least 2.6 other regional jobs, how does the government justify implementing a tax that could lead to the loss of over 4,000 jobs in the Latrobe Valley alone, when necessary socio-impact studies have yet to be considered?

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

It is true that reducing emissions by 2020 will require transformation of the energy sector. What I would say to the senator is that both parties acknowledge that. In fact, Mr Hunt, for those opposite, after the last election, pointed out that, were they in government, they would be negotiating the conversion of both Hazelwood and Yallourn from brown coal to gas. That would have an impact on electricity prices and that would have an impact as well, obviously, on the nature of those plants. Both parties are committed to reducing emissions. In response to your question, we would justify implementing the reduction in emissions through a price on carbon for a very simple reason: it will cost Australians less. It will cost taxpayers less, it will cost Australian families less and it will cost Australian business less.

John Madigan (Victoria, Democratic Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. If the impact studies in the Latrobe Valley and other areas confirm a greater effect on these communities and industry than those assumed by Treasury in its modelling, will the government commit to reducing its figure of $23 a tonne to reverse the devastation caused to Australian manufacturing communities such as the Latrobe Valley?

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

Unsurprisingly, I do not accept the senator's proposition about devastation. I would point to the evidence which shows we can continue to grow the economy as well as grow jobs whilst putting a price on carbon. I would also point the senator to the very significant set of assistance that the government is providing through various parts of the clean energy package, which are about supporting jobs and communities. They include the Energy Security Fund, the regional structural adjustment assistance package and a range of other measures, including in the $9-plus billion Jobs and Competitiveness package.

The government is very conscious of the importance of supporting industries and communities through the transition, but I again say that the coalition also wishes to reduce emissions by the same amount as the government; the difference is their policy will cost Australian families more. It will cost families more, it will cost taxpayers more and it will cost Australian business more, and that is what the Australian Treasury has said. (Time expired)

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Climate Change and Energy Efficiency, Senator Wong. I refer the minister to the fact that this morning $21 billion has been wiped off the Australian Stock Exchange as concerns grow over the handling of the sovereign debt crisis in Europe and the United States. I also refer to the warnings made by the chief economist at the International Monetary Fund yesterday that the global economy has entered a dangerous new phase. Given that the overseas economic environment is fragile and could worsen further, are there any circumstances under which the government would reconsider its commitment to introduce a carbon tax on 1 July next year?

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

I am acutely aware of the risks, particularly in the global economy, and I spoke about some of those yesterday. If the senator with an interest in this matter has taken the time to read the various IMF documents which have come out in the last couple of days, he would see that one of the things that is spoken of consistently by the IMF is the importance of a sound and transparent fiscal strategy. I would have hoped that the senator who was once in this portfolio in the opposition would care about the fact that his colleagues have no fiscal strategy, have a $70 billion black hole, went to the last election refusing to disclose to the Australian people what their policies cost—

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

Nonsense! Repeating falsehoods doesn't make them true.

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

I will take that interjection.

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

Senator Wong, ignore interjections; they are disorderly.

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

I am accused of saying things which are untrue. Interestingly, Treasury and Finance found an $11 billion black hole in your election policy costings. That is not Senator Wong saying this; that is the institutions of the Treasury and the department of finance.

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Mr President—

Honourable senators interjecting—

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

Senator Joyce, as is the practice, I will give you the call when there is silence.

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Mr President, a point of order on relevance: the question was whether there are any economic circumstances under which the government would reconsider its commitment to introduce a carbon tax. I do know whether she is about to say yes or no, or what she is actually saying.

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

There is no point of order. Senator Wong, you have 51 seconds remaining to answer the question.

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

I am making the point: if the senator cares so much about the fragility of the global economy, and how we ensure we respond to it, he would actually care about whether or not those opposite could cost their policies, because so far under this economic team the opposition have not once been able to cost their policies. They have not yet once got their numbers right—and numbers that matter. What they have is a $70 billion black hole.

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Mr President, on a point of order which once more is on relevance: are we to take it that her discussions on the coalition's position mean that she would consider her commitment to introduce a carbon tax by 1 July next year or that she would not consider the introduction of a carbon tax? Which one is it to be?

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

There is no point of order. The minister has 13 seconds remaining.

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

I am simply pointing out the hypocrisy of putting to the government that we should worry about the global economy when one is part of an opposition that has a $70 billion black hole at a time when we need certainty around fiscal policy—a $70 billion black hole. (Time expired)

Senator Sherry interjecting—

Senator Cormann interjecting—

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

To those two senators who seem very anxious to debate the issue: there is five minutes to go and then you can debate it.

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I refer the minister to a media release she released as Minister for Climate Change and Water on 4 May 2009 in which she said:

We have listened to calls from the business community for a later , more gradual start to the Carbon Pollution Reduction Scheme and additional assistance to help manage the impacts of the global recession.

If the Rudd government felt it necessary to calibrate its climate change settings to global economic circumstances, why won't the Gillard government do the same or are we just waiting for the Rudd government to come back later in the week?

Honourable Senators:

Honourable senators interjecting—

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

When there is silence on both sides we will proceed.

Honourable senators interjecting—

Senator Cormann! Order! Senators on both sides! Order!

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

I am asked about additional assistance. That additional assistance to which I referred at that time is included in the clean energy package. I am asked about delay. We are beyond the date that the Carbon Pollution Reduction Scheme would have started, and that is a matter of record. In relation to the IMF, I make this point for the edification of Senator Joyce: The IMF have said:

We support the proposed introduction of a carbon price as part of a transition to a permits trading system to mitigate greenhouse gas emissions.

This appears in Australia 2011 Article IV Consultation Concluding Statement, 1 August 2011.

Earlier this year the IMF also said:

Broad based taxes on greenhouse gas emissions are the most natural policy instrument as they exploit all possible behavioural responses for reducing emissions throughout the economy.

If the senator cares about the cost to the Australian economy of pricing carbon, he should care doubly about the cost of his policy, which would double the cost for Australian businesses. (Time expired)

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. At the time the Rudd government version 1 delayed the CPRS, the Leader of the Greens, Senator Brown, said that the decision could hardly be more disappointing. Isn't the government's refusal—both version 1 and version 2—to consider the delay more to do with their reliance on the Greens to stay in power than their ever-shifting belief in a carbon tax and their ever-shifting belief in who their leader should be?

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

I do not think that is a serious question. It really is not a serious question. I am happy in this place to answer questions of policy. That is a piece of political diatribe. There is nothing further.

George Brandis (Queensland, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

Mr President, on a point of order: if the minister wants to take a point of order she is at liberty to do so. She has not done so. It is no answer to a question for the minister, in a condescending way, to say, 'That is not a serious question.' The questioner is entitled to an answer, and if she wants to challenge it there is a way to do so.

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

There is no point of order. Minister, have you anything further to answer?

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

A little irony to be accused of being condescending by Senator Brandis. He is good at that.

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

QC.

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

I am sorry, Senator Brandis QC, aka Lord Brandis. I have outlined the reasons for the government's intent to price carbon, I have explained the reasons for it and I have nothing further to add to my previous answer.