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 Ludwig. I refer the minister to his answer yesterday, when he erroneously asserted that the Gillard government was providing comparable protection to export businesses from the impact of its carbon tax as that provided to businesses in Europe under their ETS. Is the minister aware that the European Union has classified approximately 160 industry sectors as trade exposed and, through exclusions or the provision of free carbon permits, effectively exempted them from having to pay any carbon price, while the Australian government has identified just 45 activities as trade exposed and worthy of a share of free permits? Why are European coal producers, for example, fully protected from the impact of the European carbon price, while Australian coal producers are not? Why are the jobs in that sector and in more than 120 other industry sectors in Europe worthy of protection from the impact of the European carbon price while the jobs in Australia in the same sectors are not? (Time expired)

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

I thank Senator Cormann for his long question. Last month the government did secure—so I will grant him that—an agreement to link Australia's carbon price with the European Union emissions trading system, the ETS. What the opposition fails to recognise is that this is a positive step. In fact, if you look at the advantages that are there, linking Australia's emissions trading scheme to Europe is a significant achievement in support of international carbon markets. What the opposition were in favour of a few years ago—they are now not so much in favour of it—is how you take global action on reducing our emissions; in other words, global action on climate change.

Opposition Senators:

Opposition senators interjecting—

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

I know you do not like those two words; they are an anathema to you, because you do not want to act. You do not agree with an emissions trading scheme. It is the best way to reduce our emissions and our carbon in the economy, and Australia, in taking that step, is taking a positive step, because from 1 July 2015 Australia's carbon price will reflect the carbon price paid by at least 30 other countries, including the UK, France and Germany. From 2015 we will transition to an internationally linked ETS where the global market sets the price on pollution. It is a positive benefit. Why? Because we will be able to then be part of 530 million people—a combined population who will be able to have the same carbon price within those 30-odd countries. This really does demonstrate, and the government is in— (Time expired)

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

Mr President, I ask a supplementary question. The minister clearly did not understand the question. Why, even after Labor's decision to link the carbon tax to the European scheme, are European manufacturers of watches, ships, pleasure craft, sporting goods, brooms, brushes, chemicals and fertilisers protected from the impact of their carbon price, while manufacturers of these same goods in Australia are not? Why are European manufacturers of work wear, outerwear and underwear deserving of free carbon permits under the European scheme, while their competitors in Australia are not, under Labor's carbon tax—the biggest carbon tax in the world?

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

I thank Senator Cormann for his question. I know he really does have an underlying support for the carbon price.

Kim Carr (Victoria, Australian Labor Party, Minister for Human Services) Share this | Link to this | Hansard source

He means well!

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

He does mean well, Senator Carr! But the linking arrangements do not change the overall access Australian firms have to international units. Australian liable entities remain able to meet up to 50 per cent of their liabilities through international units. The EU ETS, being the longest-running emissions trading scheme, is highly credible and it has always been our policy to work towards linking with Europe and other developing emissions trading schemes globally. It seems to me that those opposite do not want a linked carbon scheme. They do not want to ensure that firms can be internationally competitive and be able to access that. Fundamentally, any potential price differential—(Time expired)

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

Mr President, I ask a further supplementary question. Why does the Gillard Labor government think it is fair to force Australian businesses to pay five times as much carbon tax over the next three years as all of the businesses across 30 European countries combined? Does the Gillard government really not realise that this pushes up the cost of doing business in Australia by much more than in Europe and reduces our capacity to compete even with higher emitting businesses in Europe, let alone the US, Asia, Africa and South America?

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

I thank Senator Cormann for his second supplementary question. Those opposite want to talk down the economy and they want to talk up the scare campaign around the impact of the carbon price during this fixed period. It is an arrogant position that they argue from, because the fixed price period will move into an emissions trading scheme—and those opposite know that. What will they do about it? They will ultimately support it. They will not change it; they will ensure that it remains. Senator Cormann will eventually eat the words that he speaks today about this.

If you look at the projections under the carbon price, you see that strong economic growth will continue, gross national income is projected to grow at 1.1 per cent per year to 2050, and income will grow. Real income per person is projected to increase by $9,000 per year from today's level by 2020. (Time expired)