Matt Thistlethwaite (NSW, Australian Labor Party) Share this | Hansard source

Thank you, Chair. What has changed, of course, is the Liberal Party leadership; and with a new leader came a new view from those opposite. The new view was: 'We no longer believe in an emissions trading scheme, we no longer believe in the efficiency of markets; we now believe in a policy of subsidies to polluters.' So they are going to pay the biggest polluters in the economy, through a subsidy based system, in the hope that they will introduce new technology and new practices that will reduce their emissions. And of course there is going to be a cost associated with that. But those opposite will not tell the Australian people that. They will not come into this place and admit that there is a cost associated with reducing emissions under their scheme—and that cost is in the vicinity of $1,300 per household, as calculated by the Labor Party. To reduce emissions there is a cost. But the philosophy of the government is to ensure that we do it in the most effective and lowest-cost manner.

I am quite surprised that Senator Cormann and others have sought to criticise the government when it comes to the Treasury modelling associated with pricing carbon. The Treasury modelling is robust; it has stood up to scrutiny in a number of inquiries now. It is the modelling produced by the same Treasury that produced the modelling associated with the goods and services tax, which predicted that the cost effect on the CPI would be of the magnitude of 2.49 per cent. What did it come in at? At 2.5 per cent—they were spot-on. Treasury have estimated that the cost effect of carbon pricing on the CPI will be 0.7 of one per cent, a quarter of that associated with the goods and services tax—yet they seek to rubbish the modelling.

Let us have a look at the Liberal Party's record when it comes to modelling. I draw the Committee's attention to the modelling that was undertaken by the New South Wales government, associated with carbon pricing. In an article published in the Sydney Morning Heraldon 20 August 2011 Matt Wade said, when speaking with respect to the New South Wales government:

Analysis used by the Premier to claim the introduction of a carbon tax would be an economic disaster for NSW shows Sydney would actually have more jobs and stronger growth at the end of the decade because of the tax.

It goes on to state:

The modelling showed other regions, including northern NSW, the mid-north coast and south-east NSW would also have more jobs and higher growth compared with business as usual.

So there we have the record of the New South Wales government when it comes to economic modelling: they attempted to hide the fact that there will be jobs growth and that their own modelling showed it.

Then we have the attempt by the Victorian Treasurer to make claims that there will be job losses in Victoria. This was well pointed out in an article in the Australian Financial Review by Matthew Dunckley on 21 September 2007. Mr Dunckley said:

If Kim Wells—

the Victorian Treasurer—

were a quiz show contestant he would now be heading home empty-handed.

The Victorian Treasurer was put in the hot seat yesterday and entrusted by the government with facing questions about his chosen topic area economic modelling on the federal government's carbon tax.

Wells then staggered his way through a quarter-hour press conference giving every impression that he had not read the 112-page report prepared by Deloitte Access Economics and handed to the government two weeks ago.

That is the performance of the Victorian government when it comes to economic modelling.

Then, of course, in the Senate recently, based on a number of questions, Senator Boswell sought to take the government to task with respect to questions associated with economic modelling. Senator Boswell sought to take a number of Treasury officials to task at a hearing of the Select Committee on Scrutiny of New Taxes associated with the modelling of the carbon price, on 10 August 2011. Professor Henry Ergas happened to be appearing before the committee at that point in time. Senator Boswell asked Professor Ergas a question:

This morning I asked a question which I will repeat to you and you can comment on it. It was: 'Respected economists like Henry Ergas have argued that the Treasury modelling has not been released to the public in order that taxpayers can scrutinise all data which his and her dollars have financed. Can you undertake to fully release this modelling?' There was a lady here called Meghan. I forget her other name.

Professor Ergas responded: 'Megan Gale', to which Senator Boswell said:

Megan Gale. She had a series of articles that you had written which she wanted to challenge. I did not have time to get them down but I think, in respect to you, that you should have the right to respond to the articles that she mentioned. I ask the chairman whether he will undertake to allow Professor Ergas to respond to those.

And then the chair, none other than Senator Cormann, replies:

Yes, go for it.

Well, pray tell Senator Cormann, what particular article written by Ergas that Megan Gail had responded to were you referring to? Was it the one in Cosmopolitan? Was it the one in New Idea? Perhaps it was the one in Who magazine.

Here we have a New South Wales Premier and a New South Wales Treasurer who apparently cannot read economic modelling; here we have a Victorian Treasurer who apparently cannot read, according to the Australian Financial Review; and here we have old Senator Boswell over there who thinks that of a Senate hearing on this issue as an episode of Australia's Next Top Model. And you seek to criticise us about economic modelling when it comes to the carbon price. Quite clearly, those opposite have no credibility at all when it comes to economic modelling, and the proof is in the pudding—the proof is in the results. These are sly and dishonest attempts by the Victorian government and by the New South Wales government to fool the public into believing that the consequences for jobs in their economies will be much more disastrous than they will in fact be. That is a despicable exercise.

Under the government's proposed package associated with the Clean Energy bills there is support for business, and the nature of that support is to ensure that our economy makes a transition from an industrial, carbon-polluting based economy into a clean energy future. The nature of that assistance will ensure that we are supporting research and development and that we are supporting jobs and investment in businesses which are subject to export competition and forced to compete in international markets. I will not go through the nature of that assistance or the level of it, but it is quite comprehensive.

The package also represents a great Labor tradition of economic growth with fairness. The nature of the package means that 50 per cent of the revenue that is raised will go to assisting households to make the transition into a clean energy future. The assistance is in the nature of payments to households. Those in receipt of family tax benefits will get additional payments. There will also be assistance to pensioners, both single-income pensioners and couples; assistance to jobseekers; assistance to retirees; and, of course, assistance to students. Those payments will ensure that the effects of the carbon price are mitigated for households. Again, the Treasury modelling has indicated that the effects of a carbon price on the average basket of goods for a household will be in the nature of $9.90 per week and that the assistance provided and proposed under the package will more than adequately compensate those households when it comes to the price increase effects associated with the legislation—and that assistance is in the nature of $10.10 per week.

In all respects, this package is a sensible reform. It is one that recognises that global warming is real and that we need to act and that the longer we wait the greater the cost will become. It recognises that an emissions trading scheme—a market based mechanism—is the most appropriate and the least-cost model to achieve reductions in emissions. Those reductions in emissions will be based on business-as-usual scenarios, which is the way that these issues are calculated at an international level. All of the international agreements that we as a nation have signed up to mention emissions and reductions on the basis of business as usual—what the reductions will be in the context of what they would have been had there not been action. That is consistent with international practice. And, of course, there is assistance for families, households, jobseekers and pensioners to ensure that they make the transition into a clean energy future.