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. Is the minister aware that 97 per cent of the world's carbon trading volume takes place within the European Union Emissions Trading Scheme, where carbon permits are currently trading at around €7, or $9, and that very generous transitional assistance arrangements were provided to carbon price payers in Europe, starting with 100 per cent free permits for emissions-intensive, trade-exposed industries? Also, is the minister aware that, according to research by the major global investment bank UBS, the European emissions trading scheme has cost European consumers $287 billion for, and I quote, 'almost zero impact on cutting carbon emissions'? Why does the Gillard government persist with a carbon tax in Australia that imposes a cost of $23 per tonne of carbon emissions—and rising—which is more than double the European price and makes Australian businesses less competitive than even their competitors in Europe?

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

It is groundhog day here in the Senate and it has been for some time. I think I have had precisely that question a number of times from different senators, possibly even the senator in question. I would have to say that at some point they might have to say something different. All they do at the moment, over and over again, is tell everybody that the world is going to end. We will know on Sunday, won't we, whether or not we are going to have parts of Australia obliterated, industries destroyed, the death to manufacturing, Whyalla disappearing off the map and all the various other things they have said.

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

Senator Wong, you need to come to the question.

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

On this occasion, Mr President, I do agree with you. When it comes to the EU carbon price, about which I was asked, I would make the point that despite the fact that Senator Cormann appears to have airbrushed the global financial crisis from the economic history records, he would be aware that there is a wider set of economic circumstances in Europe which is obviously reflected in a range of prices, including the carbon price. We have not seen a market price which has not been affected by these conditions and it is unsurprising that prices in terms of the carbon units in Europe are also affected. We know that the European price has moved around. We saw it above $A23 for most of 2005 to 2009 but I would say to those opposite that whatever the criticisms Senator Cormann might have of the European scheme—and we believe we have certainly made improvements on that scheme—they are nothing compared to the criticisms that economists would make of the scheme he supports. The scheme he supports is a taxpayer funded, bureaucratically driven grants program. (Time expired)

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

Mr President, given the minister's answer, I ask the following supplementary question. Is the minister aware that this USB research also found that had the $287 billion which the European ETS cost instead been invested in direct action to replace the EU's dirtiest power plants, emissions could have been reduced by 43 per cent instead of having almost zero impact on the back of emissions trading? Does that finding not demonstrate that well-targeted direct action is more cost-effective than Labor's great big new carbon tax?

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

The answer is no and there is a reason why no credible economist has lined up behind the coalition when it comes to their direct action plan—not a single one.

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

That is just not true.

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

Name one, Senator Cormann.

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

Senator Wong, ignore the interjections. You should address the chair.

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

I was invited, Mr President. We are still waiting. There is a deathly silence on that side because everybody knows that what they have signed up for is a taxpayer-funded, grants based scheme run by a bureaucracy. Who would have thought that the party of free markets, supposedly the Liberal Party, does not like a price signal but wants a bunch of bureaucrats here in Canberra to dole out money? So we would take money from punters, money from Australian households and we give it to Canberra to dole it out. That is your policy, Senator Cormann.

Honourable senators interjecting—

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

Order! Debating across the chamber at this time is disorderly.

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

Mr President, I ask a further supplementary question. Why would the Gillard government persist with following the European bureaucratic example on pricing carbon when clearly that has been a recipe for disaster for both the European economy and European consumers?

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

Why would the Gillard government persist with pricing carbon, which was the advice received by Prime Minister Howard? Why would the Gillard government insist on pricing carbon, which was the policy the Liberal Party took to the election in 2007? Why would the Gillard government insist on pricing carbon when we know that Mr Turnbull and others on that side, honest enough—

Honourable senators interjecting —

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

Order! The time to debate this is at the end of question time. The minister is entitled to be heard in silence.

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

Why would we persist with pricing carbon when those on that side who are honest enough to tell the truth have also said it is the most efficient way? The real question here, Mr President, is why those on that side have signed up to the same targets as the government—

Honourable senators interjecting—

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

Senator Wong is entitled to be heard in silence.

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

The real question is why those opposite have signed up to the same target but are persisting with a policy which costs taxpayers more, costs Australians $1,300 more in tax for every household in this country. That is the policy of the Liberal Party and the National Party. (Time expired)