Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Climate Change and Energy Efficiency, Senator Wong. Given that there are only 11 days until the carbon tax is introduced, can the minister explain why the government has not undertaken any specific study or analysis into the effects of this tax on Australia's horticultural sector? How does the minister respond to findings in the report commissioned by Horticulture Australia that the impact of the carbon tax on horticultural producers is likely to represent a significant reduction in farm profits?

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

It is the case that the carbon price will commence very soon and it is the case that, when it does, I think you will see that some of the more extraordinary and outlandish claims made by the Leader of the Opposition will be shown to be untrue. Some might recall that the Leader of the Opposition suggested that towns would be wiped off the face of the map and that whole industries would be shut down.

Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Link to this | Hansard source

Mr President, I raise a point of order on relevance. My question was about a response to the Horticulture Australia report, not comments by anybody else.

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

Order! The minister has one minute and 35 seconds remaining in which to answer the question. I draw the minister's attention to the question.

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

What I can do in relation to agricultural output is refer the senator to the Treasury modelling, which found that agricultural output would continue to grow under a carbon price. Gross outputs would increase by 130 per cent between 2010 and 2050, the agricultural share of the economy and employment would increase from 2.4 per cent in 2020 to 4.1 per cent in 2050 and the food-manufacturing industry is also expected to increase by 137 per cent between 2010 and 2050. Updated Treasury modelling released on 21 September last year confirmed the previous modelling finding, that agricultural productivity and agricultural gross output would continue to rise irrespective of the introduction of a carbon price. In relation to food prices, the Treasury estimates that seafood and fruit and vegetable prices are likely to increase by only 0.4 per cent in 2013. And, of course, as the senator would know, the government has ensured that these price increases are reflected in the assistance package which the government is providing and which includes increases to family tax benefit, pensions, disability support pension and allowances and a tripling of the tax-free threshold.

Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Link to this | Hansard source

Mr President, I have a supplementary question. Does the government concede, as noted in the report, that many of the strategies required to reduce the impact of the carbon tax may require substantial capital investment, that producers are currently operating on very slim margins and are likely to struggle, as will those that currently lack the necessary capital, skills or knowledge to transform their businesses, and that there will be a gap between the introduction of the carbon price and the commencement of assistance to growers to make the adaptive changes necessary for their survival?

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

In relation to the last part of question, the senator is referring to the assistance package—I think it is called the food and foundry assistance package. So I am pleased that he is referencing the fact that the government is putting in place assistance for those sectors to recognise that there is merit in transitional assistance. But I again make the point the proposition seems to be that growers would have to absorb all the costs all of the time. The government's modelling does assume there would be a small impact on prices, as I outlined, and that has been taken into account in the assistance to families and to households which the government is putting in place. So I would suggest to the senator that perhaps he should have a look at the assistance that the government is providing to the industries that I have outlined and also to households. (Time expired)

Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Link to this | Hansard source

Mr President, I have a second supplementary question. How does the minister explain why industry was left to establish that the horticultural sector was overlooked in ABARES' and other studies already conducted by the government into the impact of the carbon tax?

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

If the question is about the conduct of ABARES, that would probably be a question to be directed to Senator Ludwig as the relevant minister.

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

Mr President, I ask that further questions be placed on the Notice Paper.