Andrew Robb (Goldstein, Liberal Party, Chairman of the Coalition Policy Development Committee) Share this | Hansard source

About 16 months ago when I assumed responsibilities for climate change within the coalition to examine the merit of a deeply flawed Carbon Pollution Reduction Scheme put up by the government, the first call I got the next morning at 20 to seven was from a friend of mine who runs a cattle station in the Northern Territory. He has 10,000 to 12,000 head of cattle. He said to me, ‘Andrew, I see you have some new responsibilities and I just want to let you know what I have been up and I want to make a request.’ He said that for the last four years he had been funding his own research at an institute in Alice Springs into the capture of CO2 in mulga. He said to me, ‘Andrew, whatever you do in the next 16 months, make sure you develop a scheme which will provide the incentive and the opportunity for me to develop the mulga on my place’—his hundreds of square miles where he can improve what has been a quite degraded arid region because of overstocking in the early development of the Northern Territory. He said, ‘There are huge productivity gains, but I cannot afford to do it unless there is some incentive. Whatever you do in the next 16 months, provide some opportunity because there is so much that can be done out here.’

When Professor Garnaut released his report, my attention was drawn to his comments about the opportunities for enhancing the very degraded areas of our arid region by encouraging the owners, the cattlemen. In this case, my friend, who is 68 years of age, had been funding it long before anyone had started really talking in Australia about the design of schemes. I saw in the Garnaut report that Professor Garnaut estimated that the restoration of mulga in the arid regions would contribute up to 250 million tonnes of CO2 per year for many, many decades. That is nearly twice our target for 2020. The Garnaut report also of course looked at other agricultural areas, such as crop land and high-volume grazing land, and the opportunity to apply good agricultural practice further than it had been to capture CO2 and rehabilitate or enhance the productive capacity of crop land and high-volume grazing land. His estimate was that there was another 354 million tonnes of CO2 for many decades in that part of the agricultural sector. This government has never mentioned the arid region. There is no focus on the arid region. That partly, I think, reflects the city based attitudes of those opposite. In the design of most of their policy they ignore the bush. They have ignored the opportunity out there in terms of carbon reduction. They have ignored the arid region and they have ignored other agricultural regions.

We are talking about a total of 600 million tonnes—which is about equivalent to the emissions we produce across the nation now—just in agriculture. If we captured that opportunity, we could meet all of our requirements, I suspect, for decades. What it does confirm is that there is every common sense in having a focus on incentives and not a punitive tax. My friend who owns a cattle station has lived in the Northern Territory all his life. If he was taxed then he would have less ability to work with the mulga, to replant, to increase the productive capacity and at the same time to store many tonnes of carbon. What the Garnaut report and what my friend have crystallised is that there is every sense in having a focus on agriculture in the arid region and in other areas.

The member for Watson has just sought in this House to suggest that it is not possible to do this. Well, of course it is possible. You could give incentives today. This government could be working today to give incentives in these areas without waiting many years to implement a scheme. It is certainly possible. He talked about the international carbon accounting rules. Of course, very disingenuously and selectively, he did not acknowledge what was said in the paper released today by the coalition. That paper quite explicitly states:

… soil carbons are not recognised under existing Kyoto Treaty arrangements, any new global CO2 emissions reduction agreement is expected to include soil carbons.

Our paper went on to say in particular:

… draft US emissions reduction legislation specifically includes soil carbons, and without their inclusion it is unlikely that a global agreement will be reached.

I went to Washington in the fortnight after the Waxman-Markey bill was passed by the lower house there. I went to see what was in the bill and what the attitudes were of people on both sides of the house and of industry. I met with nine industry groups. I met with senators from both sides of the house. What was very clear in what was said to me was that that US draft bill includes agriculture and provides an opportunity for agriculture to be very much part of the international carbon accounting rules. I was told in no uncertain terms that no global agreement would be agreed to by the United States unless agriculture was included.

The member for Watson stood up here and sought to mislead the public in terms of what our paper said, what is likely to happen and the opportunities. If we ignore what is going on in the United States, in China and in other areas where big competitors exist then we will perpetuate the core problem with much of the government’s scheme in front of us—that is, it is too far ahead of the rest of the world. It does not accept what is taking place in the design of schemes or the progress in other parts of the world.

Now the Australian people have a choice before them on the question of dealing with emissions abatement and emissions reduction. They have a choice between a practical, direct action approach to reducing emissions or a great big new tax which carries huge risks for jobs, for the cost of living and living standards, and for many industries. It carries huge risks. Not only that, the Australian people have a choice between a practical, direct action scheme which is understandable. This will be very clear to people. You give an incentive to a 68-year-old cattleman in the Northern Territory, he undertakes then to plant a certain quantity of new mulga across hundreds of square miles on his property, and that captures CO2. Try and explain to me how the ETS works. I bet the frontbench on the other side could not explain how it works. Certainly the backbench cannot. Certainly the Minister for Climate Change and Water in two years has not been able to, and nor has the Prime Minister. There were discussions at Christmas barbeques all over Australia where people scratched their heads and tried to work out what the hell the ETS was. How did it work? How does paying billions of dollars of taxes—and miraculously increasing the price of electricity by 25 per cent, increasing the cost of grocery bills each week by many dollars and increasing the price of everything in this country—reduce carbon emissions? They have not explained it. They have not stood up here in the House and explained it on any occasion. It is incomprehensible and should not be supported.

People now have a choice between an incentive based scheme or a highly punitive penalty based game. What do you think will be the psychology of people in that regard? I think people will cooperate. If a 68-year-old cattleman who has been there all his life took an initiative at his own expense to do something about it nearly eight years ago, it does show where people’s heads are at. If you give them an incentive and give them some assistance to do what they can do, things will happen. People have a choice now between an affordable $10 billion scheme or an economically crushing $115 billion scheme. Our scheme is much, much cheaper while meeting the same targets in 2020.

In the scheme that is being proposed by the government, they will auction 70 per cent of all of the permits in the second year. They will issue permits for all of the CO2 production in the country. They will auction 70 per cent and take that money. In the first year it is about $11 billion or $12 billion. The first year in taxes is the cost of our scheme over the whole period through until 2020. They will tax that money. It is 70 per cent of all permits being auctioned. Let’s look at what is happening elsewhere in the world, at what the EU put up as the beacon of emissions trading schemes. They auction four per cent of permits. They get a tax revenue of four per cent of all permits. The Prime Minister and the Labor government will get 70 per cent of all permits. This is massively ahead of the rest of the world.

In the US scheme, which is in a draft form and still to be debated—and it could take two years before it ever gets through the House, if it does at all—15 per cent are being auctioned, not the Australian 70 per cent. We are so far ahead of the world that if we pass this ETS we will be absorbing enormous risks. That is why, if we do pass this scheme with those big risks, we will expose ourselves to the loss of tens of thousands of jobs, because industry here will be trying to absorb that tax and pass it on to consumers, where their competitors in other countries have none of that tax. We will export jobs and export emissions if we go along with the government’s scheme. People now have a choice: they can get the same target without that loss of jobs, without industries being put under threat and potentially investing overseas, without any of the fear, uncertainty and confusion that exists in regard to this emissions trading scheme—and, what is more, without a massive big tax of $112 billion or $115 billion coming off the balance sheets of Australian companies which have been the strongest in the world on resources and energy. We are good at it. We have had 150 years of resources and energy. Their balance sheets will be intact so that they can invest in low-emission technology, which we can export.

We can lead the world with the technology. That is possible with our scheme, with a direct action scheme. It is impossible with the government’s ETS which is currently on the table. They are looking to choke the potential for industries to develop low-emissions technologies. We saw that today with the Minerals Council’s media release, where they said:

The failure of the Copenhagen climate change talks underscored the need to promote and adopt economically conservative climate change policies aligned with the rate of development of policies and actions across the rest of the world.

There is no point trying to lead the world with aggressive climate change schemes if the major economies are not interested in following—or worse still, regard Australia’s initiatives as an example of what not to do.

The Copenhagen fiasco amply demonstrated that the major economies and Australia’s export competitors have no appetite for radical CPRS-style economic re-engineering in response to climate change.

The proposed CPRS remains the most costly emissions trading scheme in the world—while failing to deliver material reductions in global greenhouse gas emissions.

That says it all. This is a dog of a scheme that the government has put up. People now have a choice: they can either incur that massive tax, the risk, the uncertainty, the decrease in living standards, the increased cost of everyday living and the job insecurity that will come with that scheme, or they can have the choice of a direct action scheme which is affordable and understandable and which will provide an incentive for industry in Australia to reduce CO2 emissions. (Time expired)

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