House debates

Tuesday, 21 March 2023

Bills

Safeguard Mechanism (Crediting) Amendment Bill 2022; Second Reading

5:19 pm

Photo of Henry PikeHenry Pike (Bowman, Liberal National Party) Share this | Hansard source

That's alright, Mr Deputy Speaker. They're right next door to each other and both held by the same party.

One of my coalition colleagues called me over the weekend and told me he was having a nice, quiet Saturday evening. He'd just come back from a community event and was now sitting down to watch the second Godfather movie with his wife. The Godfather Part II, of course,is regarded as one of the greatest films ever made. I'm sure many members would agree. It is one of those incredibly rare sequels that is better than the original film.

Sequels rarely surpass the original, and in this bill we find the same rule applies. The Labor government's carbon tax 2.0 will be far worse than the original. I can't really say that the carbon tax mark 1 was much of a box office hit either. Labor still has many of the same cast over there, many of the same actors perhaps playing different roles. I doubt the public will be any more receptive to this horror movie the second time around.

The coalition supports action on climate change but understands that a balance must be struck between reducing emissions and ensuring the continuation of a strong, prosperous and sovereign Australia. It is easy for critics to say, 'We need to do more,' 'We need to go faster,' 'We need to go harder.' We've heard that from some of the crossbench and government members today. But governments have to operate in the real world. When dealing with an area of policy like this, which has such wide-ranging implications across our economy, we need balance. We need proportionality. We need action but nuanced in a way that ensures our long-term best interests.

When last in government the coalition grew the economy by 23 per cent, while also exceeding Australia's Kyoto targets, pledging net zero by 2050 and reducing Australia's emissions by more than 20 per cent compared to 2005 levels. The coalition understands how important it is to manage the needs of our environment and economy simultaneously. But what is clear from this bill is that this minister and Prime Minister do not.

The fine balance that Australia needs to strike is being forsaken for political grandstanding. While there were years of balanced and sustainable emissions reductions that reliably met and even exceeded targets while maintaining strong economic growth, under the coalition, this government is attempting to distort the purpose of the safeguard mechanism—from a system that caps emissions to one that penalises businesses, imposes taxes and costs jobs.

Let's be fair dinkum about this bill. It does not tweak the emissions safeguard first introduced by the coalition. This bill, effectively, destroys that mechanism completely and replaces it with a souped-up version of the Gillard era carbon tax at more than three times the cost. This bill will impose a super carbon tax—carbon tax 2—on the Australian economy, on Australian businesses and on Australian households. All this is at the very time there are cost-of-living and inflation concerns, particularly concerns about higher energy prices, which are having a massive impact right across our nation. All this bill will do is make Australia weaker and poorer. Anything that leaves us weaker or poorer or in any way less able to rapidly build the capability that we need for close cooperation with our friends and allies, over the next few years, is not something we can either justify or reasonably afford.

Labor's new carbon tax will require 215 of Australia's largest industrial enterprises to each slash their carbon dioxide emissions by almost five per cent, each and every year, to 2030. These companies will be required to pay $75 per tonne of carbon dioxide that they emit over an arbitrary baseline set by the government, and, of course, this underlying carbon price will increase as the years go on.

Recent modelling by RepuTex reported in the Australian shows that annual baseline reductions will need to significantly increase, from 4.9 per cent to between 5.8 and 8.9 per cent from 2024 to 2030, if Labor's target is to be met. It is becoming clearer that even the 4.9 per cent year-on-year reduction required of our biggest emitters by this bill may itself pale into relative insignificance compared to where this mechanism may take us between now and the end of this decade.

The threats climate change poses will not be overcome by imposing draconian penalties on businesses, crippling our economy or increasing taxes. More tax and more government is rarely the remedy that results in greater innovation. Only policies that work with business and encourage technological innovation will help solve the climate problem. It is unfortunate that this Labor government fails to understand this critical point.

The bill has been referred to the Senate Environment and Communications Legislation Committee. The Senate Standing Committee for the Scrutiny of Bills has not yet commented on it. Stakeholders have expressed concern about the limited time frame for the consultation and the staggered release of key documents, particularly of the Chubb review, which they regard as limiting detailed consideration of the proposed amendments. Given all the virtue signalling and all the claims of transparency from Labor on this bill, it is somewhat perverse for this Labor government to deliberately stagger the release of the bill's draft. This approach has meant that many stakeholders have failed to adequately assess the full impact of the proposed changes. In fact, due to the sheer number of legislative instruments in this bill, there is not much for stakeholders to comment on at all. This tactic by the government is both highly irresponsible and potentially dangerous, especially when it relates to changes as important, as impactful, as the provisions that are contained within this bill.

This government and this Prime Minister are running away from scrutiny, and the use of excessive legislative instruments is clear evidence of this. According to the Environmental Defenders Office and the Australasian Centre for Corporate Responsibility, this approach leaves too much power in the hands of the minister and the Clean Energy Regulator. Of the two principal amendments made by this bill, neither was included in the exposure draft, and both conflict with stakeholder opinions. This is a government that aims to shirk parliamentary process to avoid detailed scrutiny of the controversial aspects of its policy. This is a dangerous precedent to be setting so early in the life of this new government. The minister informed the Senate just last week that he will not be releasing the Australian carbon credit units modelling. Of course, the previous government released the equivalent modelling when we adopted the policy to reach net zero by 2050. The question must be asked: what is the government hiding by failing to release this modelling? What does this modelling say that the government doesn't want the Australian people or the Australian parliament to know? The Liberal-National coalition will work in parliament this week to force the Albanese government to release modelling of its climate change policy or deny its legislation being considered in the Senate. The move is necessary because of the government's refusal to comply with the Senate order to release modelling on the impact of the safeguard mechanism. Labor simply refuses to tell Australians how its reforms to the safeguard mechanism will impact families, businesses and jobs.

Amidst a full-blown cost-of-living crisis—and we've heard a lot of mention of that this week in this place—Labor wants to introduce a super carbon tax and then hide modelling of its impact from those who will be forced to pay more for everything, from fuel to food and everyday materials. I make a point of doing a lot of doorknocking in my electorate—I've knocked on about 20,000 doors in recent years—and the conversations that I have with the constituents of Bowman are very much centred around concerns about the cost of living. We saw the default market offer come out last week, which outlined significant increases to energy costs for businesses within South-East Queensland. The conversations that I've been having at people's doors, at shopping centre mobile offices that I've been holding, at sporting fixtures, at community events, at retirement villages that I've been visiting, have all been the same. They've all been focused on the cost-of-living crisis that is occurring across this country. We need to take consideration of that when we're considering such a massive bit of legislation that has such broad impact across so many of our major sectors, which will of course trickle down to having an impact on household budgets and businesses all across this country.

Electricity prices are continuing to spiral out of control under Labor, with new increases of up to 23.7 per cent for households and 25.7 per cent for small businesses now announced. A proposed increase to the default market offer revealed last week will ensure that households in my electorate will be worse off by up to $383 a year, far from the promise of a $275 decrease that we had from the now government during the election period. Of course, we haven't heard much from them in defence of it since then, despite the coalition's best efforts during question time every day.

Labor's new carbon tax 2.0 will increase the price of everything of everything from food to fuel, at a time when households are already struggling to make ends meet. The safeguard mechanism is one more example of Labor weaponising recently legislated reduction targets. The changes proposed by this bill essentially disrespect the will of the Australian people by reimposing the Gillard-era carbon tax on Australians almost 10 years after Australians comprehensively rejected it.

While the government argues the mechanism will not affect businesses, this is blatantly untrue. Business groups may be too scared to publicly condemn the new government, but they are certainly sharing their views on this bill when they meet with us. Big business groups are sharing those views with us, and the small businesses within our electorates are sharing their views, as well. I can tell you that some of our nation's most important industries have a deep concern about what this will mean for them. Australians will be hard-hit by these changes. Increased production costs will result in an even higher cost of living, and a significant decrease in our international competitiveness will damage our economy, destroy jobs and erode our strength.

One final point that I would like to make is on Australia's security over the coming decades. A lot has been made of that in recent weeks, and we acknowledge the changing strategic landscape that our nation faces. We welcome the AUKUS announcement made recently by the Prime Minister in San Diego and the subsequent announcements and details that have been revealed. Of course, it was the former coalition government that established the AUKUS concept and struck the original deal. We welcome the moves by the federal government to take that threat seriously and prepare Australia for the challenges that we'll face over the next few decades.

Nations that seek to cast themselves in competition with us have no interest in hampering their economic growth through climate action, and we need to be sure that when we do take action it does not cost us our global competitiveness and ability to respond to threats as they emerge. We must ensure that we continue to produce what we need to produce, at a cost that's reasonable, for us to be self-sustaining and able to maintain our way of life despite the pressures that we'll be facing over the coming decades. We must ensure we remain prosperous enough to maintain and grow our defence capability while withstanding the economic pressures that will be brought to bear.

I congratulate the Albanese government for thinking long term about our national security, but we need the same long-term thinking about our economic capability and our domestic industry. We cannot risk the sovereignty of Australia or sacrifice the livelihoods of Australians simply to meet the self-indulgent demands of those who are well off enough to afford it. It may be an inconvenient truth, but this is precisely what the bill aims to do, what the Labor Party aims to do and what the government aims to do.

For a time, we may cop some criticism for taking a firm stand against this bill and not embracing the faith of those opposite, but dark days are coming. While the coalition sees the dangers and understands the tough decisions that must be made, only the government has the power to implement these decisions. The government needs to understand that my constituents and most everyday Australians want reasonable and measured action to address climate change. We want action based on evidence, balanced action, action that serves Australia's immediate and long-term interests. This bill is far from a balanced approach, and I will certainly not be supporting it.

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