Luke Hartsuyker (Cowper, National Party, Deputy Manager of Opposition Business in the House) Share this | Hansard source

I am pleased to have the opportunity to speak on the Carbon Pollution Reduction Scheme Bill 2009 [No. 2] and the related legislation because the transition to a low-carbon economy is one of the biggest challenges in the history of our economy. This process will change the way Australia relates to its trading partners, it will change the way that the government interacts with the free market and it will ultimately lead to changes in the way consumers behave. No industry will be left untouched by Labor’s emissions trading scheme. No family will be able to avoid the consequences of this new tax. Whether they realise it or not, every person in my electorate has an interest in the outcome of this debate.

I am mindful that there are a range of views on the issue of climate change and carbon emissions. Indeed, among my own constituents there are a very wide range of views. I know of some people in my electorate who are so convinced of the dangers of climate change that they have completely changed their lifestyle, and I also represent people who are convinced that the theory of human activity related climate change should be filed alongside Aesop’s Fables. Because of the wide range of views on this subject and the complexity of the issue, I have made a concerted effort to research carefully, taking in literature from both sides of the argument. I have also met with constituents and other stakeholders to hear their views about carbon emissions and climate change. Recently, I met with a group of scientists from Climate Scientists Australia. We had a very informative and constructive dialogue.

The Prime Minister advances his flawed Carbon Pollution Reduction Scheme as the only solution to climate change. However, there are a range of programs and options that may be implemented by the government as it seeks to reduce our national emissions. One option is to use a market based approach, which is the basis for an emissions trading scheme. In a nutshell, an emissions trading scheme works by setting a cap on the amount of carbon that may be emitted by Australian industries each year. At the end of each financial year, liable entities are required to surrender an eligible emissions permit for each tonne of greenhouse gas emitted during that year. In theory, the government can gradually reduce our national carbon emissions by reducing the number of emissions permits that are available each year. This reduction in the supply of permits is supposed to force the price of permits up, which eventually makes it more viable for businesses to invest in low-emissions technology than to buy expensive permits. The ETS solution also supposes that emissions intensive goods and services will become more expensive, which will encourage consumers to favour goods and services that are less carbon intensive.

Another scheme designed to reduce carbon emissions is a simple carbon tax. A carbon tax is similar to an ETS, but, instead of the government controlling the quantity of carbon that may be emitted and allowing the market to control the price, a carbon tax allows the government to control the price of carbon while letting the market determine how much carbon will be emitted. The theory with a carbon tax is that the government can gradually increase the tax on carbon emissions, which encourages industries to invest in low-carbon technology.

Another option available to the government is to mandate the use of low-emission or zero-emission technology. We already see this taking place with regard to the renewable energy target, which was recently passed by the parliament. There is scope to use this type of scheme to reduce our emissions by mandating, for example, the use of gas fired electricity generators to meet a proportion of our electricity needs—no need for a tax; no need for a complicated market based system; just a simple mandate to get a desired outcome. The government also has the option—heaven forbid!—of itself investing directly in low-emissions technology. In certain circumstances, this may well be a more desirable course of action.

Clearly, contrary to the claims of the Prime Minister, there are a range of solutions to the environmental challenges we face. We should not be fooled by government spin and rhetoric that this Carbon Pollution Reduction Scheme is the only solution to the challenges that we face.

Although there are obvious benefits to allowing the market to play a central role in reducing our emissions, I can see that there are significant deficiencies in the government’s current plan. I find it particularly hypocritical for the Prime Minister to be introducing a scheme which is based on free market ideology when he declared himself that the global financial crisis was the ‘culmination of a 30-year domination of economic policy by a free market ideology’. The Prime Minister’s infamous diatribe in February’s edition of the Monthly made it clear that the free market was the sole source of the world’s financial woes. Yet less than 12 months later he is trying to convince us that the free market will be the saviour of the earth.

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