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

My question is to Senator Ludwig, the Minister representing the Minister for Climate Change and Energy Efficiency. As a result of Labor's decision to link its carbon tax to the European Union Emissions Trading Scheme, Australian coal producers will pay the European carbon price equivalent whilst higher-emitting European coal producers will not have to pay anything at all because fugitive emissions are excluded from the EU scheme. Indeed, higher-emitting coal producers in Europe will continue to receive subsidies whilst Australian coal producers will pay the European carbon price. Can the government explain the logic to the coal workers who are currently under threat and some losing their jobs: why will Australian coal producers pay a tax but their competitors in Europe receive a subsidy?

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I thank Senator Joyce. One of the difficulties in this is always the opposition's continued opposition to it. That is how they seem to be yelling about it. But the premise of the question—or perhaps the way you have phrased it—is that in the EU they regulate, whereas we have a fixed period and then move to an emissions trading scheme. To ensure that the record is straight around this: the EU was the first international carbon market in the world and is now the largest. It has operated for nearly a decade and has delivered cost-effective emissions reductions. Trading carbon with other credible trading systems is in our national interest because it will help us reduce emissions at the lowest cost.

We have not suddenly stopped trading in goods and services with the EU simply because of the current economic circumstances. In fact, if you look at the EU as a bloc, it is Australia's largest trading partner, accounting for over $90 billion worth of two-way trade. From 2015 that trading relationship will include carbon as well. Australia will have the same carbon price as 30 other countries with a combined population of 530 million, and this government is in discussions with schemes being developed in China, Korea, New Zealand and California—

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

Mr President, I rise on a point of order, on relevance. The substance of the question is quite clear: why does Europe get a subsidy for their coal producers and we have to pay a tax? What is the explanation and the logic from the government? That is the point I am alluding to.

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

There is no point of order. I believe the minister is answering the question. The minister does have 31 seconds remaining.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

And of course it is one of those areas where—perhaps Senator Joyce did not hear when I first answered him—they have a different scheme. They regulate, whereas what we are doing is using the market based system to drive down emissions. I am sure they will eventually agree with this policy. They are unwilling, but I have no doubt that, should they ever get to government, they will not reverse this scheme. They will continue to support an emissions trading scheme— (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 supplementary question. Given that Australian businesses collectively already have to pay five times as much carbon tax over the next three years as all the businesses across 30 European countries, does the government now recognise that its carbon tax, even when linked to the EU ETS, will make Australian businesses less competitive against their European competition?

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I can continue to say that what we do have is a system where on average the Australian carbon price will cost households $9.90 per week with average compensation of $10.10 per week. These are the official figures that have been calculated by the Australian Treasury. Of course, those opposite have not released any figures to substantiate. One of these areas you do not talk about is Mr Billson's claim that the EU ETS costs around $1 per person compared to around $400 per person in Australia.

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

Mr President, I rise on a point of order. This is a question about businesses, and we are getting an answer about households. He might have been handed the wrong piece of paper—so if the lady would like to get the right piece of paper and bring it back to him?

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

That is not a point of order.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I had not finished. Most importantly, one of the areas for small business is the materiality of that increase to the business: what portion of that increase to their revenue is generated by the business. (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. Given government revelations last night that not one single free carbon permit has been issued by the Gillard government to an Australian business and, at most, only 170 of the 42,500 Australian export businesses will ever get free carbon permits under Labor's carbon tax, how can the government expect Australian exporters to remain competitive with businesses across Asia, the US, South America, Africa and Europe, without basically being put out of business?

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

An extraordinary question again from Senator Joyce.

Senator Joyce interjecting—

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

You should stick to foreign investment.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

Yes, perhaps foreign investment.

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

Order on my right! Order on my left! When there is silence we will proceed.

Joe Ludwig (Queensland, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

Perhaps to help Senator Joyce so that he does not make the same mistake on foreign investment: the government's auction policy is not about the budget bottom line or maximising revenue; it is there to transition to an emissions trading scheme in a predictable and efficient manner. It provides for efficient price discovery in the marketplace.

Senator Joyce interjecting—

Obviously, you do not want to hear the answer to your question, Senator Joyce. The final auction arrangement, which is about how we transition to an ETS, will be through a legislative instrument which we intend to make early next year, after further consultation with stakeholders. The pollution cap will be set in 2014 after advice from the Climate Change Authority. That is the system we will employ to move from a fixed price to an emissions trading scheme. (Time expired)