Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Action, Environment and Heritage) Share this | Hansard source

Eight weeks ago, less than five days into the period of the carbon tax, as the government's floor price and the government's plans collapsed, the Minister for Climate Change and Energy told the Australian newspaper, when asked whether or not they were about to drop the floor price, that they were committed to the package as a whole. This was when the story of what he was about to do was leaked, and he said to the paper something that was transparently, clearly, untrue—they were committed to the package as a whole. In eight weeks we have seen eight major changes to this carbon tax. What was meant to be eternal, what was meant to last a thousand years, what was meant to be the system for the ages, has not even lasted eight weeks. What we have seen so far is chaos and costs and damage, and it is the Australian public that are paying the price of the carbon tax and the government's uncertainty through job losses, investment losses and electricity price rises.

Let me start with what this tax is all about, and that is electricity price rises. The government has been through this period of pretence that electricity prices are somehow not being affected, so let us go to the facts about electricity. In New South Wales we have seen an 18 per cent price rise, and the carbon tax alone has contributed 8.9 per cent. The government seems to dismiss this massive increase on top of what was already a high price as unimportant. It gets better. In Queensland, there have been power price rises of 11 per cent—with the carbon tax on average representing 13 per cent but in some cases representing 80 to 100 per cent of the power price rises. Why? Because the Newman government froze prices on many tariffs and in most cases the carbon tax makes up at least 80 per cent and in many 100 per cent of the power price rises. In Western Australia, 70 per cent of the power price rise comes from the carbon tax. In the Northern Territory it is 70 per cent; in the ACT, more than 75 per cent of the power price rise comes from the carbon tax. They are not our figures—that is the regulator, that is the independent modelling and that is the lived reality of every small business, every family and every pensioner who is paying the price of this carbon tax at this minute. In Victoria we have seen an average increase of about 11 per cent, which is sometimes 15 per cent and sometimes less in terms of electricity price rises.

So what is the message? It is that the carbon tax is in chaos and Australians are paying the price. What was meant to be a system to provide certainty has become the definition of uncertainty—eight major changes so far. We had the bailout on the eve of the carbon tax of Alcoa and of Energy Brix, following on from payments of $250 million in the weeks before the carbon tax to each of the Loy Yang, Hazelwood and Yallourn power stations. To put that in context, they had to give no-strings-attached cash payments—potentially some of the biggest cash payments ever in Australian history—of $250 million to each of three power stations in Victoria.

The second thing we have had is a decrease in the share of funding for small businesses under the government's Clean Technology Investment Program grants. That was announced just weeks into the carbon tax. The third thing is that more companies were added to the hit list for the carbon tax within weeks of the carbon tax being introduced. The 'certain' list changes almost by the week—names coming off, names going on; companies and councils unable to plan. That list is in permanent flux.

The fourth thing we have had is changes to regulations governing the scheme, including a sell-out of landfills which were promised that they would be included in the scheme, so much so that potentially 40 per cent of current landfills will not be covered, including the one where they announced the scheme. They went to Clayton, they announced the scheme and it turns out it was a clayton's promise—that scheme, that landfill, ain't in; it does not qualify. Talk about a hoax and a lack of transparency—going to a landfill, announcing it is in and it turns out it is not. Unsurprisingly, the owners are a little upset. This means that councils end up having to pay higher prices.

Then we get to the fact that they are abandoning the Contract for Closure program. That was a brilliant success—a triumph of administration! This was the minister's baby—he was going to deliver contracts for closures. It is not surprising that this did not work. The geniuses on the other side created two schemes—they created a $2 billion Contract for Closure scheme which was meant to close power stations, and they also created a $5½ billion Energy Security Fund which was meant to pay the same power stations, the same companies, to stay open. So what we are seeing is a fund to close power stations and a fund to keep open power stations. If you ever wanted the definition of a government which had no idea what they were doing, it is the fact that they have allocated $7½ billion, $2 billion to keep them open and $5½ billion for them to close. That is evidence of a bunch of people who make it up as they go along. They do not care how much public money they spend; they do not care how much public money they waste—but they do care whether or not there is a pretence of action. It is all about the pretence of action.

Then we go to the scrapping of the floor price. On 5 July the minister said that they were committed to the package as a whole. The story had been leaked from within his own department to the Australian that they were going to drop the floor price. He denied it—flatly, clearly, absolutely. But he denied it knowing that he was in negotiations to drop the price. A level of honesty is required to be a member of parliament but there does not seem to be a lot of that on the other side. This minister went to the newspaper and flatly denied something which was known to them, known to us, known to the parties and revealed publicly, and he could not face the fact that, five days in, the carbon tax was in chaos and one of the pillars of their own scheme was collapsing. The minister said:

Well we've put in a floor price at a price cap to provide some confidence over the first few years about the potential variability of the price.

He said the ceiling 'would avoid sharp price spikes or plunges'. There are numerous other quotes, from 11 occasions on the floor of the parliament or the public domain, from the Prime Minister, the Parliamentary Secretary for Climate Change and Energy Efficiency, the minister and the Minister for Finance who have all said that this floor price was vital, that it was essential, that it was critical. The thing about this government is that every day is year zero; every day they draw a line under the page and what they said yesterday is a relevant—it means nothing. That is the fundamental problem. There is no commitment to consistency; there is no sense of sovereign risk; there is no sense of duty or of obligation. Everything has a shelf life of 24 hours. How could you make that statement, knowing that it was untrue? Both the minister and the parliamentary secretary know that what was said was untrue, that the minister deceived the Australian people—knowingly, openly, publicly—and he did it again on 21 August on national television. At the very time he was preparing to announce the dismantling of the floor price he was denying it on national television. There was no escape clause; there was no hedging; there was no recognition of a possible future change. It was an express, clear and absolute denial of a process which had begun months before. And they say this is all about certainty. Well, it is not.

That then leads me to the fact that they had linked the scheme to Europe—so they say. We could always buy European credits, but for those members who represent rural constituencies, your constituents will be surprised that we have done a deal to give Europe a virtual monopoly seller status to Australia. In return, what would you expect Australians would get? Virtual monopoly seller status to Europe perhaps? No. The ability to sell to Europe immediately? No. The ability to sell to Europe in 2015? No. Australia would get the ability to sell to Europe finally in 2018. In other words, their great deal locked out Australian farmers and Australian firms from having any engagement in Europe, while giving Europe that shining beacon of economic reform at this current moment—a virtual monopoly seller status to Australia. They have done something extraordinary. They have given effective control over Australian taxation and electricity rates to a sovereign state.

Mr Combet interjecting—

If you do not understand that the carbon tax sets electricity prices, then you should not be in the job because that is precisely what it does. The carbon tax sets electricity prices. It is an electricity tax. It is designed to be an electricity tax. It is intended to be an electricity tax and it is an electricity tax. And on every statement the minister has made in the past 24 hours we hear that they have transferred—by their own words— control over Australia's system to Europe. But you would wonder whether this is going to mean lower prices.

Let us unpack what they are doing. They have tried to imply that it might mean lower electricity prices in Australia. They have hinted, they have nudged, they have winked, but their own modelling, reaffirmed by the minister, says that the carbon tax price in 2016 will still be $29 a tonne. It will still be $37 a tonne in 2020.

So what does all this mean in real terms. It means that the price of electricity will still be high and all of this talk is a hoax. Their own modelling is still of $29 a tonne. If it is not then their budget will fall apart. Either electricity prices will continue to soar or their budget falls apart. They have given the nation a Hobson's choice because the system they have designed is not robust. It does not deal with any inconsistencies, any changes, and they know it. They know that electricity prices are going to continue to soar because they have told us. $29 a tonne is still the modelling and, if it is not the modelling, this is the opportunity for the minister to tell us. I would invite the minister, during his 15 minutes, to tell us if his modelling still stands because, if it does, electricity prices will continue to soar. If it does not, you have the slight matter of a massive budget crater.

This government have made massive changes with massive consequences on a carbon tax at a time when we see skyrocketing electricity prices. We also see a massive problem for industrial production and therefore jobs and therefore investment in Australia—Olympic Dam, changes to the outer harbour at Port Hedland, changes to Fortescue Investments, the Gregory mine in terms of coal and today the Red Hill coalmine. This is just weeks after Marius Kloppers specifically said that the carbon tax would have a huge impact on eastern seaboard coalmines. And what is this government's approach? It squanders the boom. It says, 'It's all a coincidence, everything's fine, no problem, nothing happening, it's all an accident, don't worry everybody.' It is not an accident; it is about making a bad situation worse.

With a high dollar, low metals prices and low coal prices, we are seeing an act of economic self-harm on a monumental scale. And it is an act of individual harm. Whether it is the motel, whether or it is the butcher who has to update his or her refrigeration, whether it is the pensioner, whether it is the family, these people are paying the price of the government's carbon tax uncertainty. The government will tell us, 'We've got a billion dollars in clean technology investment grants. We've got a billion dollars for small businesses.' The only problem is—and this brings me to the eighth change—they froze it. They told us what a great job they were going to do for all the small businesses, but they froze their own program, which was meant to save the people they were hurting. So their budget is in chaos, their carbon tax is in chaos and electricity prices are skyrocketing, and they do not think any of it is a problem—but it is.

At the end of the day, the grand irony is that emissions go up, not down. The Australian public is right onto this, by the way—emissions go up, not down. So over the period from 2010 to 2020 Australia's emissions go up by 43 million tonnes. That is not our work—yours. At the end of the day, it is hurting the economy, it is hurting families and it does not do the job. (Time expired)

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