Bridget McKenzie (Victoria, National Party) Share this | Link to this | Hansard source

I stand here today as a National representing regional Australia, accepting the science and accepting the process of scientific research and argument which has led to the competitive debate being seen right throughout our community over this issue. What I do not accept is this government's ineffective response to the issue of climate change. I do not accept that regional Australia has to bear the brunt of the impacts of this folly of a policy. I do not accept that this policy will see the temperature drop or climate change halt. I do not accept that this response will result in the behavioural change required to make a significant impact on the human production of carbon and I do not accept that unilateral action by a nation state the size of Australia is going to address the issue in any meaningful way.

While I do not agree with the government on many things, I do agree with this statement from their website on climate change action, 'Climate change is a global problem that requires a global solution.' The Prime Minister knew this when, as Deputy Prime Minister, she convinced the then Prime Minister, Mr Rudd, to drop the ETS. She knew this when she went to the election and told the Australian people there would be no carbon tax under any government that she led. But to hold her job as Prime Minister she needs the vote of the sole Greens member in the House of Representatives and the legislation before us is the price the ALP has had to pay to maintain the facade of power over this minority government. That is the only reason we are debating the Clean Energy Bill 2011 and related bills this week.

I believe that we should always be good stewards of our environment. As somebody who has studied science, I believe science should keep poking and prodding at the climate change question because the science is never settled. Those who say it is do not understand the nature of scientific investigation and the real Luddites in this debate are those who try to close down competing views and the opinions of others, including those who will suffer most under this new tax. They are the modern version of the flat earth society.

They are trying to brainwash us into the belief that the world is rushing to impose a Gillard type carbon tax on their national economies. Such people obviously do not follow world events very closely. The major economies, including the United States, are walking away from the Kyoto protocol and since the CHOGM conference we know that the government of Canada will not even contemplate imposing a carbon tax on its citizens. This is particularly interesting because Canada is our closest cousin in the Commonwealth in its history, cultural practices, major industries, economic growth and population. But the similarities stop on the question of dealing with climate change. At least Canadians got to have a vote on a carbon tax. That is the vote that was denied to the Australian people. There was only one successful candidate for the lower house at the last federal election that campaigned on a policy of introducing a carbon tax—that is, the Greens member for Melbourne, Adam Bandt. Only one member of Canada's lower house went to their election advocating a policy of carbon taxes and an emissions trading scheme. She is also a Green. Unlike in this aberration of a parliament, one Canadian Green does not get to impose their will on an entire nation.

As we look around at China and India, in fact the entire globe, Ms Gillard and the Greens have brought us to a very lonely place in the international response to climate change. As usual the devil is in the detail. The lack of consultation, the lack of detail given prior to the moving of the bills through the lower house, the secretive list of 500 top polluters and the failure to release the modelling with the appropriate assumptions outlined shows that the 17 bills rushed before us have been drafted in haste. The Joint Select Committee on Australia's Clean Energy Future, where the bills were referred to for scrutiny, was similarly rushed. As a result, I must confess that, while I am doing my best as a new senator to read the legislation before the Senate today—as you can see there are about two feet of it here on my desk along with associated explanatory material—I confess I have not been able to get through it all. I will do my best in the time allotted by the government for the scrutiny of this legislation. An indication of the haste with which this has been brought in is that we are shutting down appropriate scrutiny as of this morning. That is an indication of the contempt in which this government and, to be more correct, their coalition partners the Greens hold the Australian public and indeed this parliament in their rush to implement an economy-wide carbon tax for no effective reduction of emissions.

Whilst accepting that climate change and the impact of human carbon production has a role to play in the equation, I look forward to a positive and sustainable future where our environment flourishes alongside our economy and communities, something this badly designed tax will not achieve. Earlier this year, Chief Commissioner of the Climate Commission, Tim Flannery, said:

If the world as a whole cut all emissions tomorrow, the average temperature of the planet's not going to drop for several hundred years, perhaps over 1,000 years.

That is with the whole world cutting all emissions today, not a small nation state cutting five per cent of their emissions as of 2000 over six years. This would suggest that there will be a period of time in our future as a globe when we will have to manage the outcomes of climate change and adapt our behaviour accordingly, but I really want to focus on the length of time Mr Flannery suggested. Let us pause for a moment and consider the technological advances that human beings have made over the past thousand years. In 1011 we did not have cars. In 1011 we did not have the electricity that we are so keen to tax today. In 1011 we could not split the atom; in fact, we did not even know there was such a thing as an atom. In 1011 the earth was not only thought to be flat but we did not realise that we could sail a ship further from shore than the eye can see, let alone build a rocket, travel to the stars and walk on another planet. Imagine what will be possible in a thousand year's time in 3011. I have great confidence in our intelligence as a species despite this badly designed legislation before us today.

There are several reasons why I believe this response by the government is a negative response to address environmental concerns. These reasons range from its ineffectiveness in addressing the issue itself to the discriminatory manner of its application. As Senator Fifield said last night, my home state of Victoria will be heavily hit. Our major export off the port each day in Melbourne is dairy produce, which goes right around the world, and our state is powered by the 500 years of brown coal deposits in the Latrobe Valley, a region in Gippsland 45 kilometres down the road from where I live. Both industries are significant employers in our state's economy and both, whether intended or not, are targeted in this legislation. Government claims of support given to the agricultural industry under these bills, as the carbon tax will not apply to agriculture, give a false impression of the government having an understanding of regional Australia and its needs. The reality is that the insidious nature of this tax means that electricity, on-farm and transport costs will all rise, affecting productivity and job security and increasing cost-of-living pressures, particularly for those living and working in rural Victoria. I will mention a few of those today. The Goulburn Valley in central Victoria is home to significant horticultural production, and we had debate on the importation of New Zealand apples and the impact that would have on the Goulburn Valley only a couple of months ago. Along with horticultural production, the Goulburn Valley is home to the highly intensive food-processing industry, which uses a lot of electricity. Specifically, apple producers need to have regular baseload power to ensure all the apples and pears are cool-stored before transport and delivery to consumers.

The dairy industry in Australia is also electricity intensive and trade exposed. The imposition of this tax on that industry, which employs over 40,000 Australians and is the largest exporter off our docks in Melbourne every day, is significant. In Victoria, the dairy industry estimates that the average dairy farming family will be hit by an additional $5,000 to $7,000 per annum on their electricity costs. The imposition of this carbon tax will cripple the dairy industry through the whole production chain, from the cow on the farm through to the bottle of milk in the fridge. Consider the impact on dairy of China's announcement of its goal of increasing the level of protein consumption for each child from 56 grams per child per day to over 500 grams per child per day. This represents a ninefold increase in protein consumption for a very large number of children. There are only two ways to increase protein consumption: through red meat or dairy products. The Australian dairy industry is uniquely placed to capitalise on this growth of protein consumption in the Chinese economy, but the imposition of this carbon tax will place the industry at a severe competitive disadvantage.

The addition of a tax on transport in 2014 is, I believe, just a tax on our everyday way of life in regional Australia. It is how we get our produce out to the docks and into the markets. It is how we socialise and travel to our sporting events. It is nothing for families of young children to have to drive upwards of 100 clicks one way just to get to their under-13 football and netball matches. That is going to be taxed—so it is not just about our economy. The Australian Trucking Association says the sector and its customers are predominantly regional Australians, and it will take a hit of $510 million in the 2014-15 financial year alone. Regional Victorians and Australians spend more on energy and transport than those who live in capital cities, and while agriculture is out for now and transport, so vital to our way of life and crucial to the viability of our local industries, has a temporary reprieve, the increased on-costs are definitely an issue for those of us who live outside capital cities.

For regional Victoria specifically, the impact on jobs will likely be felt far and wide. In Shepparton, in the north-east of Victoria, the modelling suggests that there will be 320 fewer jobs in an area where food processors are already under pressure from international factors. In Mildura there will be 220 fewer jobs by 2020. If these tax bills pass this chamber, at least 24,000 fewer jobs will be created across Victoria than if the economy were not so constrained. Victoria's total output will be cut by $2.8 billion in 2015 alone, according to a report by Deloitte. On a microeconomic scale, this translates to 600 fewer jobs being created in regional communities like the Latrobe Valley—about which we have heard a lot over the last couple of days, thanks to Senator Madigan—and $70 million in output stripped from the local economy in 2015.

I make particular reference to an issue facing the power generators in the Latrobe Valley, and that is the lack of deferred settlement arrangements for permit purchases contained in the legislation here beside me. This is yet another reason that this is simply a badly designed tax, as it will have a wide-ranging impact on individual generators and the power sector as a whole. The Latrobe Valley is a regional community which already underwent restructure during the 1990s, and 20 per cent of the community is directly employed by the power generation business. Victoria does not have electricity generation sources to match the baseload supply that we get out of the Latrobe Valley, and it uses carbon intensive brown coal. The annual emissions of Loy Yang Power, just one of the generators in the valley, are approximately 19.5 million tonnes. Based on the $23 a tonne starting price, this will result in an additional $450 million in costs in the first year of the scheme. Under the previous CPRS, devised by the then Prime Minister, Kevin Rudd, generating companies had the sensible option of a deferred settlement facility which was available when permits were auctioned. Under the current regime, no such deferral option is available, and I encourage the government to consider it at the amendment stage. As such, it is effectively a matter of paying the money in advance for the power generators. We will eventually get the money back, but the working capital requirements power generators will have to cope with are significant.

In fact, the competitive advantage of the Latrobe Valley is in brown coal. Any rational government would invest heavily in research and development to find new, cleaner ways to use this coal, which will be key in assuring this region a positive future. This government had the chance to contribute to the development and diversification of the valley's economy through the Regional Development Australia Fund, but even though we knew this was all coming not one grant was forthcoming for the projects put forward to diversify the local economy in the Latrobe Valley.

Given the $100 million available for the forestry restructure, significant questions remain around the sufficiency of the $200 million available in regional structural adjustment assistance for those regions severely affected by the carbon tax. That $200 million is—wait for it—available for all regions across the nation over a seven-year period. I argue that the government has once again severely underestimated the economic and social impact of this legislation on regions like the Latrobe Valley, the Hunter, the Goulburn Valley, the dairy regions and so on. The $200 million in that package will be simply a tokenistic effort to stimulate local growth and diversify those economies. This government's lack of understanding of the impact of this tax on regional Australia is very much on display in how it has treated the Latrobe Valley.

Finally, this is a poor policy solution because it is not part of a global response. Australia has a proud history of going it alone and making it count—for instance, the unintended consequence of going it alone in 1902 on the suffrage of women was not the disruption of our economy, the disadvantaging of our trade or discrimination against the regions—yet in this vacuous response to dealing with climate change we will be hanging out on a limb, adding costs to the production of every good and service in Australia. And we will be alone. We will be on that path alone.

This will not change the climate. Our action here will not decrease the temperature if Canada, the US, Europe, India and China do not get on board in the same way, and given the current global economic outlook it is unlikely they will. One of the many fabrications peddled by Labor spokesmen and spokeswomen during the course of this debate is that many nations are moving to tax carbon and we are being responsible in keeping up with the worldwide trend. We have already heard what Canada thinks of carbon taxes, and I am sure that during the US presidential visit the media will ask President Obama what the United States is going to do about an effective response to climate change. I would put all the money in my back pocket on a bet that he will not be adopting legislation like this and restraining his economy, particularly at this time.

The Labor member for Bendigo, Mr Steve Gibbons, claimed in the local newspaper on 13 October, the day after the carbon tax package squeaked through the lower house, that Australia had become the 33rd country to put a price on carbon. Really! I look forward to the member for Bendigo, in his next missive to the Bendigo Advertiser, naming these 33 countries that have taxed carbon in the same way that the Gillard government wants to tax Australians—and I think some really great points were made this morning on the setting up of the market arrangements and our participation with these other '33 countries'. It will be fascinating to watch!

Yes, various countries have played around the edges, and others have made pledges, usually with an eye to a generous international aid package, but it is unlikely that they are going to sign up to a Labor-like carbon tax. Despite producing one-tenth of the EU's emissions, Australia faces a tax take 14 times larger than that of the EU. Australia's scheme will raise more tax in its first seven months than the EU emissions trading scheme generated in its first 6½ years.

But most telling is the fact that this legislation neglects to provide support for small business in transition arrangements. This is a significant oversight but certainly not surprising for this government. Everyone else gets a slice of the action. Householders are treated to a generous assistance package to mitigate the increased electricity costs brought on by the tax. One wonders what incentive there will be for householders to change their behaviour and reduce their reliance on dirty electricity if they are getting so much financial assistance. I am not confident that there will actually be a change in lifestyle.

Regional industry such as agriculture has been omitted, transport industry has three years grace and there are compensation packages for power generators, yet small business, the powerhouse of our economy, a significant source of employment within our regional areas, has no support and is once again bearing the increased costs of compliance. How typical that whilst Minister Sherry is announcing tax relief for small business with one hand, Combet is taxing them with the other.

The Australian Bureau of Statistics defines a small business as one that employs fewer than 20 people. Around 30 per cent of Australia's economic activity is generated by small businesses. In my home state, over 1.2 million people are employed in small business. This is an economy-wide tax, so unless you live in a teepee in Nimbin you will be subjected to it. There is no incentive, as I said earlier, for us to change our behaviour. In fact, as stated earlier, the modelling shows we will actually increase our emissions rather than reduce them.

For no environmental gain, because we are going it alone at a time when the countries of the world are focused on keeping their economies strong rather than slowing productivity—

Trish Crossin (NT, Australian Labor Party) Share this | Link to this | Hansard source

Senator McKenzie, your time has expired. I did not mean to cut you off mid-sentence, so my apologies.

David Fawcett (SA, Liberal Party) Share this | Link to this | Hansard source

I rise to address the Clean Energy Bill 2011 and related bills as a Liberal senator for South Australia, but also as somebody qualified in science from the University of New South Wales and someone who has spent the majority of his career working in a systems engineering environment evaluating risk and assessing complex systems. To do that work you need to understand the integrity of the processes and the data you are working with, and that is the approach I intend to take in looking at these bills and the carbon tax in particular.

There are two issues at stake with the bills before us: firstly, the carbon tax itself and whether the benefits it will bring to the environment outweigh the costs associated with it. To resolve that question, the second issue comes into play: how certain are we that the information we have been told thus far about the threat to the environment is true and accurate? How can we be certain that the threat will eventuate and, if it does, what are the consequences of the threat eventuating? Will this new tax provide an effective means to avoid or manage the threat or at least mitigate the consequences if it occurs? In the world of business and finance, questions like this are resolved in part by the process of due diligence, which is a form of constructive scepticism, not denial. It is a process to verify that all of the information you have been told thus far is true and accurate before you commit to a business transaction.

So how should we as legislators do due diligence on a change of this magnitude on our economy and our society? In a business transaction, teams dealing with marketing, forensic accounting and legal issues all have different roles to play. They communicate information relating to the same subject to different audiences, for different purposes and at different levels of detail. During due diligence, however, you would find very few successful venture capitalists who committed funds on the strength of an assessment of the facts by the vendor's marketing team alone. They would place far greater weight on their own forensic accountants and legal team. In the case of climate change, the truth-seeking role of forensic accountants is conducted by our scientists and we should give detailed consideration to what they are actually saying rather than just to the marketing team's executive summary. This is not to disrespect the marketing team. I recognise the genuine concern and passion of those on all sides of this debate who care about our nation and our world and who passionately advocate, people such as the Australian Youth Climate Coalition, who made time to meet with me in Adelaide. I am heartened when I see young people in particular prepared to look beyond themselves and to invest their time in causes for the common good.

But passion alone is not enough. As an experimental test pilot, I was not afraid to question a proposal no matter how passionately it was presented—in fact, generally I found the more passion, the more scrutiny was actually required. You have to critically ask: does the evidence or do the facts actually support what is put forward in the glossy brochure? Interestingly, most of the advocates that I have spoken to on this issue of climate change and the carbon tax have never actually read one of the IPCC reports—not even the synthesis report, let alone one of the underlying reports such as Physical Science Basis produced by Working Group 1. To come back to the business analogy, they have not done their own due diligence—they have not even read the business proposal, let alone the audited accounts—but appear to have made a decision based solely on the glossy marketing brochure. So can we trust that brochure? There has to be integrity in the process that has led to it. Certainly as a test pilot, before I would commit to flying a sortie, I would want to be assured of the integrity of design, of the disclosure information, of the data that actually determined the performance of the system under test or of the models that were used to predict that performance.

I have learned to place a great deal of trust in the engineers who support the design and the preparation for any test work and to work with them to understand the facts and uncertainties to evaluate the risk inherent in any activity. In the same vein, I applaud the dedication and integrity of the work of the vast majority of scientists in Australia and around the world who are contributing to the research and understanding of our world, our oceans, our land and our climate. They are not afraid to admit that they do not know everything and that we are always learning new and surprising things about our world and the way it adapts. Just last month ScienceDaily reported a new insight into global photosynthesis, the chemical process governing how ocean and land plants absorb and release carbon dioxide. What they have found is that the way that ocean and land plants absorb it actually occurs 25 per cent faster than previously thought. That fundamentally changes the assumptions that go into modelling about how our planetary systems respond to increased carbon dioxide. Do existing models take this into account? Obviously not, because this was only published last month.

People working at the coalface recognise that current models are far from perfect. In fact, even the co-chairs of IPCC working groups 1 and 2 last year proposed an expert meeting to develop better ways to refine and use the output from models. Drawing from their proposal, they state:

… not all of the new models will include interactive representations of biogeochemical cycles, chemistry, ice sheets, land use or interactive vegetation. This makes a simple model average increasingly difficult to defend and to interpret …

They go on to say that the new model should provide 'more robust and reliable projections of future climate, along with improved estimates of uncertainty'. What do they mean by uncertainty? A good example of an admission of the wide range of uncertainty that actually undermines the global climate models appears in Dr Tim Woollings' 2010 paper published by the Royal Society. He said

The spread between the projections of different models is particularly large over Europe, leading to a low signal-to-noise ratio. This is the first of two general reasons why European climate change must be considered especially uncertain. The other is the long list of physical processes which are very important for defining European climate in particular, but which are represented poorly in most, if not all, current climate models.

For those who like the thought of peer reviewed publications, remember that the Royal Society is a fellowship of the world's most eminent scientists and is the oldest scientific academy in continuous existence. It was established back in 1640. So how much uncertainty are we talking about? In 2009 Haerter published, in the journal of the American Geophysical Union, a paper dealing deal with aerosols, which are just one of these many inputs to global climate models. He said:

Due to these large parametric uncertainties, we apparently do not know the mean sulfate aerosol forcing component of Earth's top-of-the-atmosphere radiative budget to within anything better than ± 50%.

He went on to say:

In reality, therefore, we probably do not know the current atmosphere's aerosol radiative forcing to anything better than ± 100%, which does not engender confidence in our ability to simulate Earth's climate very far into the future with state-of-the-art climate models.

If I were to encounter error budgets of this magnitude in simulations for a prototype aircraft, I certainly would not be rushing to take it flying.

Models are not the only area of uncertainty. What should we do as legislators when the scientists do not agree? One good local example is the Great Barrier Reef. One school of thought has led to the common perception that emissions cause global warming, so raising temperature, which leads to coral bleaching and the reef dies. But experts in the field do not have a consensus on this. Professor Peter Ridd from James Cook University has recently highlighted, again, that as the sea warms coral in fact grows more vigorously. He is not alone in this. Back in 2004 the CSIRO detailed a report showing exactly the same thing, that rising sea temperatures in fact boost coral growth.

So if numbers of our eminent scientists are in fact willing to work with integrity and disclose the facts, the uncertainties and the gaps in our knowledge, why are we being presented with the story that the science is settled and the unscientific attitude of anyone who questions it makes them a 'denier'? Is it possibly because the heads of the marketing department know that if anyone felt compelled to do some due diligence they might expose flaws in the business case which would stop us buying into a costly venture such as this new tax and its associated impost on the Australian people and our economy? Surely not. According to the IPCC website, it is a scientific body and it 'embodies a unique opportunity to provide rigorous and balanced scientific information to decision makers'. They are sound ideals, but are they actually implemented and rigorously audited to check for a conflict of interest when appointments are made of people like editors and leaders who oversee the review process and the aggregation of data for consumption by the public and the policymakers? Would any scientist have such a conflict of interest? Recent media reports say that some do. One of the authors of the Berkeley Earth Surface Temperature—or BEST—study, which is billed as the ‘end of scepticism’ about climate change, actually threatened to quit after she said the project leader underplayed the fact there has been no global warming for the last 13 years. Professor Judith Curry was one of 10 experts attempting to compile definitive temperature data going back over 200 years. She claimed it had been tarnished by the project's director, who was overselling the results in favour of global warming. This director was Professor Richard Muller, who in a 2008 interview with Holly Richmond, who was with the green news organisation GRIST, was quite open about the fact that he did not mind people exaggerating if it furthered the cause. He said in respect of Al Gore:

If he reaches more people and convinces the world that global warming is real, even if he does it through exaggeration and distortion—which he does, but he's very effective at it—then let him fly any plane he wants.

Are there others like Professor Muller? Sadly, the answer is yes. They hold key positions in the IPCC. A recent publication on the IPCC written by a Canadian investigative journalist highlights the disturbing lack of governance within the organisation. This lack of integrity in the processing of that scientific information, some of which supports the case and some which does not, means we cannot trust the rolled-up summaries that we get. That expose goes on to look at a number of appointments of people who have been long-term activists in movements—some of them scientists, some of them not. One of the people recently appointed has been a long-term activist and director of the climate program for the World Resources Institute and the WWF's chief spokesperson on climate change, and has worked in the Climate Action Network but is not even a scientist. I am sure she has a very genuine interest, but her background is as a professional activist and her academic qualifications are a Bachelor of Arts from Indiana University in political science and Germanic studies—hardly one of the world's greatest scientific minds, yet the IPCC states that science is the basis of the information they have given to us as legislators.

Even a small amount of effort on due diligence shows that the process that leads to the glossy brochure, the rolled-up summaries that many people are making their decisions on, is not sound. Certainly recent events are showing that uncertainties exist. The climate change minister in 2009, Penny Wong, stated:

... this severe, extended drought is clearly linked with global warming.

Not only have we seen the floods, which history tells us are not uncommon for Australia, but the Climate Commission’s report tells us:

... it is difficult from observations alone to unequivocally identify anything that is distinctly unusual about the post-1950 pattern.

If the integrity of this process is suspect, what else lacks integrity? Certainly the politics—the reason for selling this product—lack integrity. Days prior to the last election, the Prime Minister announced to the Australian people that 'there will be no carbon tax under a government I lead'. For reasons of political expediency, she has been happy to allow that promise to become a lie in order to form a coalition with the Greens for the sole purpose of retaining power. The people of Australia should not forget that every member of the ALP who is now speaking in favour of this new tax also owns this lie.

There is also no integrity in the spin around the facts of global action—it is pure political sophistry. We are told that we will be left behind because China is taking action to close coal fired power stations. But there is no mention in these summaries, in this spin, of the new 500-megawatt plants coming online at a rate of at least one per week, according to a study conducted by the Massachusetts Institute of Technology. Even Australia's Ross Garnaut, in his third update paper, says that between 2005 and 2020 Chinese emissions will increase from approximately five billion tonnes of CO2 per annum to over 12 billion tonnes per annum. This growth of over seven billion tonnes a year compares with Australia's decline of approximately 70 million tonnes on 2005 levels by 2020. In short, our decrease in emissions is likely to be eclipsed by growth in one country alone that is 100 times or more greater than our cuts.

On balance, how do we evaluate the risk to our environment against the risk to our economy? Due diligence has shown us that neither the probability nor the consequence of the climate risk is certain. The scientists say so themselves. But what about the risk to our economy? Will the benefits eventuate? Much has been made of green jobs and the new economy, but despite Europe's extensive green jobs policies a surprisingly low number of jobs have been created—two-thirds came in the construction, fabrication and installation phase, one-quarter have been in administrative positions, marketing and project engineering, and just one out of 10 jobs has been created at the more permanent level of actual operation and maintenance of renewable sources of electricity. The study, done by the King Juan Carlos University in Spain, calculates that the programs creating those jobs also resulted in the destruction of nearly 110,500 jobs elsewhere in the economy—or 2.2 jobs destroyed for every one job created in the green economy.

What about business costs? In the real world, people doing due diligence on investments are now talking about sovereign risk in Australia. In the past Australia has been considered one of the safest places to invest. Nystar in Port Pirie has to make a decision in the next few years about a $400 million upgrade to their smelter—which provides employment for around 670 people—but they are now questioning whether they will go ahead with that upgrade. It is estimated this carbon tax will cost the company $10.2 million in the first year alone, and we are now seeing broad public discussion about whether this investment will go ahead and those jobs will continue into the future.

The defence industry in South Australia is part of our national defence capability. It is worth some $2 billion to the South Australian economy and generates many skills and jobs. Much has been made by this government of the need for the defence industry to be competitive in the global market if it is to remain sustainable. This carbon tax will reduce the competitiveness of our industry, which threatens its future viability and hence the employment of South Australians and, equally as importantly, elements of our national defence capability.

Will this tax be effective? At $23 per tonne, it falls well below Treasury forecasts of the level of value of carbon emissions that is going to drive behaviour towards renewables. Particularly when we go to an ETS, if it is then aligned with Europe, which has gone well below $23, it will be a lose-lose for the Australian people. The lower that value is, the less able the budget is to provide the supplements and support that have been so much vaunted by this government. If the ETS goes above the $23, people will lose out because those supports will not be there.

The Business Council of Australia says that, far from creating certainty, the tax is both ineffective and deeply uncertain. They agree with the scientists. The carbon tax is ineffective because it raises $105 billion of costs on Australian industry while simply sending investment, and therefore emissions, overseas. Even the Southern Cross Climate Coalition, a strong supporter of the carbon tax, has said that the carbon tax on its own will not be enough to cut emissions. So why impose the pain if even the most ardent supporters recognise that it will not achieve the desired outcome? This coalition also highlights that cost-of-living impacts for very low-income households will probably be higher than those modelled. In conclusion, the deliverables promised by the glossy brochure did not stack up so well in the business plan. In some cases they are not supported by the underlying facts, which shows that there is a flawed process and a lack of integrity. Having done my due diligence, I find that the scientists, as our forensic accountants, have done their job well. Some of the underlying data supports the business case, some does not, but in the summation and rolling up the executive summary through the IPCC, the process is compromised by the unchallenged appointment of long-term activists to key positions and the suppression of genuine debate. There is significant uncertainty surrounding the models used to forecast the level of threat and, indeed, the underlying assumptions are being challenged in current scientific research. The promised benefits and identified costs are not supported by more detailed analysis of the facts.

Why should we move jobs offshore to countries that will replace our manufacturing—and will do so with higher emissions—in response to a threat that still has significant uncertainty about both exposure and consequence? Why should we trust a government to fundamentally change our economy when they have lied just to retain power, have proven themselves unable to effectively implement even a simple policy such as home insulation without causing harm, and have allowed billions in waste in building school halls? South Australians—who are now seeing their jobs at risk because companies are hesitating to invest in Australia due to the sovereign risk represented by this government—should hold the Labor members for Adelaide, Hindmarsh, Kingston, Wakefield and Port Adelaide and every ALP senator to account at the next election for their part in the lie that there would be no carbon tax under a this government. As a legislator, I will not be committing our nation, our economy and our future to a flawed plan to address an uncertain threat.

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

Can I follow Senator McKenzie's lead by bringing into the chamber copies of the bills and say at the outset that today we have insult on top of insult. This government has gagged the gag on these 18 bills and that is an absolute shame, on top of the other shame that they have lied to the Australian public. The purpose of these so-called 'clean energy bills'—or should I say 'carbon dioxide tax bills'—is to impose a new tax. This is to raise revenue. It is as simple as that. If anyone thinks that this is going to affect the climate in any way, they are absolutely delusional. For the Prime Minister, these bills serve as yet another way of highlighting her incompetence not just as a leader but also the hopeless state of her government in its Green alliance. This is a government which could not deliver ceiling insulation without burning down homes. It is a government which could not deliver an education revolution without billions of dollars of waste. It is a government which has lost the confidence of the voting public. Now this government wants to impose a tax on every Australian to change their behaviour by punishing them for using power, for doing their jobs and for earning export dollars.

The science is not settled. The planet's climate has been changing since day one. Shame on those opposite, shame on the Greens and shame on the Australian Labor Party for having vilified ordinary Australians who dare to voice their views and, yes, their scepticism. Shame on the Prime Minister for the way she has described these ordinary Australians who just want to express their point of view.

I associate my comments with many of those made by my colleagues. Today I would like to use the opportunity to talk about the Illawarra. Whoever thought of imposing a tax on every Australian should visit the Illawarra. Ms Gillard has been visiting the Illawarra quite regularly, most recently on 18 October, her second visit in less than six weeks. Only days after celebrations in the other place, Ms Gillard came to the Illawarra, a productive region which houses industry and manufacturing, family businesses both large and small and centres of excellence in education. Already the Illawarra is straining under economic conditions and is now reeling from prospective job losses at BlueScope Steel. Ms Gillard thinks that rolling out the NBN in the Illawarra and the Illawarra Region Innovation and Investment Fund will make up for the pain of the carbon tax. She is fooling herself if she believes this. The biggest insult in all this is to the workers and the families of the Illawarra.

What is the feeling in the Illawarra about the carbon tax? If you look at the survey of local businesses you see that the Australian Labor Party received a thumping. In the state election in March the result was a resounding defeat of Labor and its carbon tax. Labour suffered swings of about 18 per cent across the Illawarra in the state election. If those opposite think that the carbon tax had nothing to do with this, they are absolutely totally delusional. The bad news for the Australian Labor Party continued in the local government elections at booth after booth, which I visited on the polling day. From down south at Shellharbour up to the northern suburbs of Wollongong the message was loud and clear: no carbon tax.

When Senator Joyce and I spoke in the mall in Wollongong, the message was loud and clear. There we had the usual union heavies dressed up as workers doing their best to heckle us and to be their usual abusive, thuggish selves but they did not take into account what the local research, through the economic reports of respected organisations like IRIS, was showing. The message that this research is showing loud and clear is: no carbon tax. Let us look at the research that was done on 300 local businesses in the Illawarra and their feelings about the carbon tax. The result was overwhelming: 68.9 per cent of businesses surveyed were against the carbon tax. That is, almost seven out of 10 businesses in the Illawarra do not support a carbon tax. Three months earlier, in June, 21 per cent of Illawarra businesses had supported the carbon tax, and that has now gone down to only 15.

When the Prime Minister visited the Illawarra on 18 October she said she was there for one reason: 'to keep faith with this region and its people'. She said:

As you undergo this process of change and transformation, you will not walk that road alone.

What a load of humbug. What a load of absolute and utter drivel from this woman. Ms Gillard, you lost faith with the people of the Illawarra, and indeed the people of Australia, the day that you lied to them and said that there would be no carbon tax under the government you would lead. So do not come to the Illawarra mealy-mouthed and tell the workers and families of the Illawarra just how sorry you feel. You have lost their faith. You lost it a long time ago. You lost it when you lied to them, so do not come along to the Illawarra and play this game: 'Yes, but now you'll have NBN jobs.' What a load of absolute codswallop. The Illawarra is absolutely buckling under—

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

Order! Senator Fierravanti-Wells, direct your comments to the chair rather than to an absent Prime Minister.

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

I apologise. The Illawarra is buckling under the redundancies at BlueScope Steel and the loss of work for contractors. But the Prime Minister believes that she can buy votes with a few announcements, the same way that she bought off Mr Paul Howes and the AWU with the Steel Transformation Plan. Remember that Mr Howes did not support the carbon tax until he received his $300 million. He then turned around and said, 'Yes, we will support the carbon tax.' He went down to the workers in the Illawarra and told them, 'You have to cop this.' But after the bollocking he got from the workers at the meetings it was very clear he had to change his tune. He ran off to the Prime Minister and told her, 'I have a problem,' and so all of a sudden $300 million arrived out of the woodwork—a very expensive path for Mr Howes, ultimately leading to parliament. Mr Howes is looking to his future parliamentary job, and this toxic tax is the price of minority government, the price for Labor to stay in power with their alliance partner, the social engineers—the Greens.

With its dependence on steelmaking and coalmining, the Illawarra will bear the brunt of the carbon tax like no other area in Australia. There are almost 40,000 mining and manufacturing jobs in the Illawarra and the south-eastern region of New South Wales, and 26,000 of those mining and manufacturing jobs are in Illawarra and Wollongong. It will be the people of the Illawarra and their children in the future who will lose out on jobs, because jobs will contract. There will be flow-on effects, but do you think that the member for Cunningham, Sharon Bird, or the member for Throsby, Mr Stephen Jones, are listening? Of course they are not listening. Mr Jones seems to run around the countryside and say, 'We've got a problem.' Well, we had a problem. We have had a problem for a long time, but did he and Ms Bird try to convince the Prime Minister not to pass this tax? No. They just sat there and copped it.

We are probably talking about 31,000 job losses across New South Wales, according to Frontier Economics, and 18,000 of those will be in the Hunter Valley. They estimate that there will be about 7,000 job losses in the Illawarra. The Australian coal industry is predicting job losses of almost 5,000, including 3,000 in New South Wales alone.

There were 226 parliamentarians elected at the 2010 election. Just 10 of those 226 parliamentarians were elected on a promise of a carbon tax, and that is a mere four per cent of parliamentarians. This Prime Minister was elected on a lie. Do we honestly believe that she would be in the Lodge today had she told the Australian public that she was going to introduce a carbon tax? The answer is no. But she knew that if she did not tell a lie she could not win the election, and that is precisely what she did. She promised no carbon tax.

I am patron senator for 10 seats in New South Wales and all of these members of the Gillard Labor-Greens alliance were elected on a lie. Robert McClelland in Barton was elected on a lie. Daryl Melham in Banks was elected on a lie. Greg Combet, the Minister for Climate Change and Energy Efficiency and member for Charlton, was elected on a lie. I have already mentioned Sharon Bird, the member for Cunningham, elected on a lie. Craig Thomson, the member for Dobell, was elected on a lie—amongst other things, but I will not go into that today. John Murphy, the member for Reid, was elected on a lie. Deb O'Neill, the member for Robertson, was elected on a lie. Stephen Jones I have mentioned. The member for Throsby was elected on a lie. Tony Burke, member for Watson, was elected on a lie. Laurie Ferguson, member for Werriwa, was elected on a lie. All of them were elected on a lie perpetrated by their leader. They are part of an illegitimate government. To win power and to cling to power they will say anything. It is the old Australian Labor Party trick—say anything. As Richo writes in his book, Whatever it Takes, the Australian Labor Party will lie. It will do whatever it takes not only to get into power but to stay in power.

Then there was Mr Swan in September last year dismissing the scare campaigns against the carbon tax. This was at the same time that research by the Australian Trade and Industry Alliance showed that almost a million Australian jobs will be under pressure as employers struggle with increased power costs and higher costs for raw materials and manufacturing components. This is because they will be competing against international suppliers who will not be paying a carbon tax. There was Mr Swan criticising scare campaigns. He only criticises them when it is not his own people doing them.

Let us look at Tanya Plibersek, the master of the no-carbon-tax scare campaign. The Central Coast Express Advocate published an article on 15 July quoting Ms Plibersek talking to seniors at the Peninsula Community Centre. She said:

We know the science tells us we need to act …

The science shows us that the Central Coast faces the highest risk of inundation from sea level rise in NSW.

The federal government is taking action to tackle this …

And she went on with the usual drivel that the governments come out with. She was out there scaring older Australians at an older persons' facility. She was scaring them.

Then there was Peter Garrett claiming on Lateline that sea levels would rise by six metres. Talk about a clumsy way of trying to scare people into thinking that a melting ice shelf in Antarctica would send us waves high over low-lying houses on the Australian coast. When he was confronted by this, Mr Garrett did nothing to refute it. If these are not scare campaigns, I am not sure what are.

For the people of the Central Coast, many of whom commute daily to Sydney, what a low act this was from Minister Plibersek when she turned up trying to scare our senior Australians and other people. They have been deceived by their local member, the member for Dobell, as I said, who has busily been doing all sorts of other things—disgraceful behaviour—and now is being investigated by the New South Wales and Victorian police. I have traversed some of his 'activities' in this chamber. The Royal Australian College of Physicians, who are hardly a radical protest group, recommended caution with a carbon tax because it could exacerbate health inequalities. Talk about scare campaigns!

But one of the peculiarities of all of this is that the tax will do absolutely nothing to reduce domestic emissions. It will be others who will reduce emissions. In 2020 $22.8 billion will be sent overseas to purchase carbon credits. In 2050 almost $57 billion will be sent overseas to buy credits. Australian emissions will increase from 578 million tonnes today to 621 million tonnes in 2020. They may be called 'carbon credits' but instances of major fraud have emerged in relation to them. We saw that in China, and it is also occurring in India. Scams are occurring. These scams are occurring under the auspices of the UN program, the Clean Development Mechanism, established under the Kyoto protocol. It was the investigations of various environmental groups and not of the program's carbon cops which brought this to light. One of those environmental groups has said that this abuse of international carbon credits is the biggest environmental scandal in history and makes an absolute mockery of international efforts to combat climate change.

What is going to happen in the end if coal from mines in the Illawarra or the Hunter is burned in Australia for energy is that it will attract $23 a tonne in tax. But if the same coal is used to produce energy overseas then it will potentially attract clean energy investment. What a perverse policy this is. It is little wonder that the Australian Crime Commission has described the carbon credit market as a honeypot for criminals, including the Italian mafia, a very active organisation. One case in Europe involves the alleged fraud of $5 billion.

What is this sense of urgency now about the carbon dioxide tax? It is of course so that Senator Brown and other people can go off to Durban and tell everybody what wonderful things they have achieved here in Australia. Just remember the last person who thought he could influence the world's stand on climate change is now no longer the Prime Minister of Australia. But there are those opposite who are obviously keen to ensure he comes back as our Prime Minister. Copenhagen in 2009 was full of false hopes and ended up in tears.

We know the effect that this tax will have on Australian households. The coalition will repeal this tax because if you do not have a tax you do not need compensation. I am proud to stand here today on behalf of those millions of Australians who do not want this toxic tax, who have been lied to by this government and who want us to vote against these bills. That is precisely what I will be doing.

Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

I too rise to speak on the clean energy bills. I will start by indicating to the chamber that the name Clean Energy Bill is a false name. Why could the government not be honest and call it the carbon tax bill? The names of the bills in this package are a disguise that do not really indicate what the bills are. That follows on from the other false premises that belie the bills, their passage and the speeches that we have heard.

I am very disappointed about the passage of these bills. Senator Fifield articulated his feelings very clearly this morning. First of all, the government would not concede that more debating time was needed for this suite of bills, the largest and most significant pieces of legislation to have come before this chamber in many years if not in the history of the Commonwealth. It beggars belief that more debating time has not been allocated to such a suite of bills. Then we lost the motion to allow sufficient time to debate the bills and to have Senate committees investigate different aspects of the bills, because we did not have the numbers. To add insult to injury, the government finally agreed with its masters, the Greens, and organised a two-week debate. This was the week for the second reading debate, which we are engaged in, and next week was for the entire committee stage. We were not comfortable with that, but we thought that at least we had two weeks. We knew that was engineered to facilitate others going to the world stage and alluding that Australia is now leading the world. So the two weeks were there, allocated for us to debate these bills. Then, this morning, without notice to us, apart from late notice yesterday, the time allowed for the debates was altered. It appears that it was adjusted to suit others who want to grandstand next week at a certain time to fit in with a demonstration, parade or celebration outside of Parliament House.

To engineer the passage of legislation to suit external celebrations—one wonders what some of them will be celebrating—is a very poor way to treat this house and this chamber. It was not sufficient that senators, no doubt including Senator Bob Brown, could go to Durban and indicate that Australia had passed the legislation—the numbers are there so the bills will pass—it now has to have a domestic demonstration as well. As a result, the entire period for proper scrutiny and debate has been truncated to suit a demonstration in Canberra next week. This is an appalling set of circumstances. If the government can prove that there is another reason for that, let them come and prove it. I do not think they can. They are beholden to their Greens master. I know for a fact that, as they wander into the chamber, Labor senators will probably hang their heads in shame, because they know as well as I do that they do not want this carbon tax. They are getting pressure from home. They are getting the indications from their constituents, who are saying: 'Why on earth are you supporting these bills? Why are you subservient,'—and subservient is the correct term—'to the Green party?'

The Australian Greens are the masters of the Labor Party's destiny. The Labor Party brand has been very severely diminished through its acquiescence to the Greens. That is a sad state of affairs in itself, but to truncate this debate to suit an external demonstration outside Parliament House, a celebration of what I consider to be nothing to celebrate, is a real travesty of the proper processes of this place. I hope Labor reflect long and hard on this. Senator Ludwig moved the motion this morning, acting on the instructions of new masters. My dealings with Senator Ludwig, when I was Manager of Opposition Business in the Senate, were always ones of honourable consideration. If Senator Ludwig gave you his word that we would have two weeks for debate, we would have two weeks for debate. So, knowing that it was not a motion of his doing, it must have been very difficult for someone like Senator Ludwig to stand up here this morning and move that motion. I sincerely hope that it was not a motion of the Labor Party's doing either. They are clutching at the reins of government by being subservient to their masters. I know they know that. I know from conversations in this place that the Labor Party are not happy with the direction they have been taken on these bills and on other matters because of their new masters. I hope they think long and hard, and I hope the public of Australia reflect their view about this at the next election. Hopefully, the next ballot will come sooner rather than later for the sake of this great country.

It was bad enough to say that we would not have a carbon tax, as the Prime Minister announced before the election. The party was campaigning strongly—there was no equivocation; it was a very strong, firm commitment that there would be no carbon tax. Think about what that does. I know people whose vote and preferences were decided upon that commitment, as do my colleagues. Promising one thing and doing completely the opposite is a very fraudulent way to obtain government. That marries in completely with the attitude of the Labor Party today in truncating debate for the sole purpose of allowing grandstanding in a way we have probably never seen before. That process does not augur well for the Labor Party, which, while it might have philosophical differences to this side from time to time, has never stooped so low as to be beholden to another party, particularly one that wants to run the entire Labor agenda and move it away from its commitments to its grassroots constituents. This will come back and bite the Labor Party at some stage. Again, I hope that stage happens sooner rather than later. Prior to the last election and this morning, we have seen a change in the values of what was once a party respected for its beliefs, commitment and honesty. Many decisions over that period have shown the new, true colours of the Australian Labor Party.

Debate interrupted.