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

My question is to the Minister representing the Minister for Climate Change and Energy Efficiency, Senator Wong. Is the minister aware that a recent report by UBS concluded that Europe's emissions trading system that has cost consumers $287 billion has had 'almost zero impact' on cutting emissions? Is the minister also aware that the report concluded that Europe's ETS had provided windfall profits to market participants which have had to be paid for by electricity customers? Will the minister now admit what European consumers now know—that a carbon tax is all economic pain with no environmental gain?

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

There are three propositions in that question. In relation to the third, no, I will not. In relation to the first, I am aware of the report. I note that the report by UBS is in sharp contrast to the opinions of many of the experts, including those who advised the previous government about the best way to tackle climate change. The report is in stark contrast to the advice from economists worldwide, from economists in Australia, from economists inside the Australian Treasury and from Mr Howard's own task group on emissions trading, headed by Dr Shergold, all of which concluded that the most efficient and effective way to reduce emissions is through a price on carbon. I also note that, while it is the case that UBS has put this report out, it has also been responded to by two others: Climate Markets and Investment Association and a Barclays Capital analyst. Both of them take issue with the number of findings in the report.

In relation to the emissions impact that was also referenced in the first part of the question, I make the point that the European Union Climate Commissioner, Connie Hedegaard, had this to say in September:

Greenhouse gas emissions from big emitters covered by the EU ETS have fallen by an average of more than 8 per cent since the start of the system in 2005.

I think there are quite a number of not only commentators but also experts, as well as those who have some responsibility for the scheme, who would take issue with various aspects of the report to which Senator Brandis has referred today.

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

It just goes to show, Minister, that different experts can arrive at different conclusions. Mr President, in a supplementary question I refer the minister to the other conclusion drawn by UBS, which is that, had Europe used the $287 billion wasted on its failed ETS to instead replace the European Union's dirtiest power plants, emissions could for that price have been reduced by 43 per cent instead of by almost zero per cent through the ETS.

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

Yes, I am aware of that proposition, and I make this point in response. Firstly, I have already responded in my previous answer to some of the assertions made in the first part of the question. Yet again the opposition insist on putting matters they regard as facts, which are disputed and are not correct, to me in questions.

On the issue of the $287 billion, if the opposition are proposing that the best way to tackle climate change is to raise $287 billion and to purchase power stations, they might want to indicate how they would fund it. The answer to that question is taxpayers, which is why their scheme involves slugging Australian families, Australian households and Australian taxpayers—or potentially Australian small business; they have not made it clear— (Time expired)

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

Mr President, a second supplementary question: given the conclusion that direct action could have reduced emissions by 43 per cent, whereas the European Union's ETS has reduced emissions by almost zero, why does the government stubbornly persist in a policy which will achieve no environmental impact for vast cost?

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

If I am asked about stubborn persistence, I may say I think the stubborn persistence is in those on the other side who continue to berate the parliament about a policy and a law which has been passed. We are clearly in a bit of historical analysis here. They certainly do not want to talk about the mining tax, nor all the splits on their side on that issue. I have already indicated in my answer that we do not agree with the assertion that direct action is somehow better. That flies in the face of the advice given to Mr Howard, the advice given by Treasury and the advice given by Australia's leading economists. In fact, the only people who believe that, somehow, taking money from Australian taxpayers and giving it to polluting companies is a good policy are those opposite. (Time expired)