House debates

Thursday, 4 June 2009

Carbon Pollution Reduction Scheme Bill 2009

Consideration in Detail

Bill—by leave—taken as a whole.

9:34 am

Photo of Robert OakeshottRobert Oakeshott (Lyne, Independent) Share this | | Hansard source

by leave—I move amendments (1) to (19) as circulated in my name:

(1)    Clause 2, page 2 (line 2), omit ‘Australian’, substitute ‘Independent’

(2)    Clause 4, page 4 (line 7), omit ‘Australian’, substitute ‘Independent’

(3)    Clause 5, page 7 (line 9), omit ‘Australian’, substitute ‘Independent’

(4)    Part 2, page 32 (line 1) to page 37 (line 9), omit the Part, substitute:

Part 2—National scheme cap

13  National scheme cap

        (1)    For each financial year beginning on or after 1 July 2011, the Authority is to determine a national scheme cap, being a quantity of greenhouse gas that has a carbon dioxide equivalence of a specified number of tonnes.

        (2)    That number is the national scheme cap number for that eligible financial year.

        (3)    The Authority must declare the national scheme cap number for an eligible financial year before the start of that year.

        (4)    The Authority must issue projected national scheme cap numbers for an eligible financial year:

                  (a)    for the financial years beginning on 1 July 2011 to 1 July 2015, by 1 July 2010; and

                  (b)    in all other cases, at least five years before the start of that year.

        (5)    In setting the national scheme cap number, the Authority must base its decision on the wider public interest, taking into account the following:

                  (a)    short and long term economic considerations; and

                  (b)    short and long term environmental considerations; and

                  (c)    Australia’s international obligations; and

                  (d)    carbon emissions and the national scheme cap number in the period prior to the eligible financial year in question; and

                  (e)    any other matter that the Authority considers relevant.

        (6)    The Authority must give reasons for its decisions under this section.

        (7)    The Authority must publish quarterly assessments and reports of its activities under this section.

(5)    Clause 88, page 130 (lines 15 to 16), omit the paragraph.

(6)    Clause 88, page 130 (lines 17 to 18), omit the paragraph.

(7)    Clause 89, page 130 (line 24) to page 132 (line2), omit the subsection, insert:

        (1)    For each of the eligible financial years beginning on 1 July 2011 to 1 July 2015, the Authority is to set a fixed charge per unit.

     (1A)    The Authority is to calculate the fixed charge per unit on the basis that the projected demand for the units will be the same as the national scheme cap number set by the Authority in section 13.

      (1B)    The Authority is to publish the fixed charge per unit for an eligible financial year at the same time as it declares the national scheme cap number for that year.

      (1C)    During each of the eligible financial years beginning on 1 July 2011 to 1 July 2015, a person who has a Registry account may apply to the Authority for the issue to the person of a specified number of Australian emission units:

                  (a)    with a vintage year corresponding to that financial year; and

                  (b)    for the per unit charge under subsection (1).

(8)    Clause 89, page 133 (line 26) to page 134 (line 23), omit the subsections.

(9)    Clause 92, page 135, line 20, omit “starting on or after 1 July 2012”.

(10)  Clause 92, page 135 (lines 23 to 24), omit the subsection.

(11)  Clause 93, page 136 (lines 13 to 14), omit the subsection.

(12)  Clause 101, page 140 (lines 24 and 25), omit the subparagraph.

(13)  Clause 101, page 140 (lines 26 and 27), omit the subparagraph.

(14)  Clause 101, page 141 (lines 5 and 6), omit the paragraph.

(15)  Part 8, page 203 (line 1) to page 211 (line 27), omit the Part.

(16)  Part 9, page 212 (line 1) to page 239 (line 32), omit the Part.

(17)  Clause 260, page 311 (line 10), after ‘Act’, add ‘and other matters related to pollution caused by emissions of carbon dioxide and other greenhouse gases’.

(18)  Part 12, after Division 7, page 334, after line 12, insert:

Division8—Publication of information quarterly

278H  Publication of information quarterly

                 As soon as possible after the end of each quarter, the Authority must publish on its website a statement, in the form specified in the regulations:

             (a)    consolidating  or providing links to information published during the quarter in accordance with the provisions of Divisions 2, 3, 4, 5, 6 or 7;  and

             (b)    providing such additional information as the Authority considers useful or relevant in relation to pollution caused by emissions of carbon dioxide and other greenhouse gases.

(19)  Clause 360, page 411 (after line 6), at the end of paragraph (2)(k), insert:

     (2A)    A person is not eligible for appointment as an expert advisory committee member unless the Minister has consulted the leader of each recognised political party in the Parliament on the individual’s proposed appointment and given each leader at least 30 days in which to respond.

When I first came into this place I said in my first speech that my role was to work in the best interests of the community, to work in the best interests of this nation and, where appropriate, to engage and work in the best interests of any international agreements. This is one such moment. What I did not say was that my role was to dumb down legislation, deliver policy that is a flat pancake and engage in the pragmatism of trying to get legislation through this place through deals with business, through deals with the Senate and at the expense of getting the best possible pure policy outcome that all of us in this place should deliver.

I do think this legislation has got down to that question of purity versus pragmatism. In conversations about the amendments last night, the government appreciated that the amendments do have an element of purity and that an ideal option is to remove a lot of the discretionary ministerial powers in the future; it is to allow the science to rise out of the political mosh pit that this legislation seems to have got stuck in over the last 12 months. If this is not about the science, then I ask everyone in this place: what is it about? Endorsing the words of the Leader of the Opposition two nights ago, this has to be about the science and the economy, not about the politics. That is why I think these amendments are important. They improve the legislation that I hope it is noted I just voted for. I voted for the legislation based not on its current form but, to pinch a line from a president, on the hopes and the dreams of what this legislation might become.

The amendment deals with some of those issues that are causing angst in the community, that are causing division in the parliament and the community—the manipulation of targets for political purposes and the manipulation of a whole range of market elements of a market based solution, such as the issuing of free permits and fixed pricing for 12 months. These are all political decisions that have been made in an effort to try in a pragmatic way to get this legislation through the parliament.

It is not my role to endorse a flat pancake. It is my role to try and prick the consciences of government and of every single member of this parliament to affirm that our role is to get the best policy outcome that we can deliver for the community. The best policy outcome for the long term is something that survives the political cycles. No matter who ends up in the chair of Prime Minister or a minister or in the executive, if we are serious we need to build something that has security of tenure.

I think there is enormous disappointment about the way the politics of division is being played with this issue. The language in the debates of the last 24 or 48 hours have all been about one side trying to kick the stuffing out of the other. One side is calling the other group ‘the job destroyers’, and then the other group is calling them ‘the climate change sceptics’. None of that is true—there are elements of truth, but none of it is generally true. I would hope that, if we are serious about our roles as members of parliament above and beyond roles within political parties, we would see this as a significant moment and as significant legislation and as a responsibility to deliver the best possible outcome for the community.

The amendment moved taps into the common sentiment that an emissions trading scheme is common sense. We have heard the Leader of the Opposition make that comment himself. There is unity on that issue. It does, hopefully, raise the question of whether a market based response to this environmental and economic question is the right way forward. The scheme itself has underlying principles that are market based. I would be incredibly surprised therefore if, when we drill down into the detail of any coalition or opposition ETS that they have flagged as something that is going to happen in the future, it would be any different to a market based response. Therefore the points of difference—the targets, the permits and the fixed pricing—need to be moved to an independent authority. (Time expired)

9:39 am

Photo of Andrew RobbAndrew Robb (Goldstein, Liberal Party, Shadow Minister for Infrastructure and COAG and Shadow Minister Assisting the Leader on Emissions Trading Design) Share this | | Hansard source

On the amendments, this is the biggest deliberate structural change, possibly in our history, that we are considering in this House today. There is no doubt, as many of the speakers on our side have suggested and have indicated, the Carbon Pollution Reduction Scheme Bill 2009 has been rushed and is ill considered. It has been very much driven by a political agenda, not an environmental agenda. In the limited time available to consider the amendments by the member for Lyne I think they ultimately, in the design of any scheme, would warrant some serious consideration. I think there are issues there: the setting of caps by some independent authority warrants serious consideration—as suggested, something along the lines of the Reserve Bank with interest rates—and the pros and cons warrant proper consideration.

Given that the government has today rejected outright our very common-sense proposal to defer the vote on this bill until such time as we see what the world decides in Copenhagen, just a matter of months away, until such time as we see what the United States does in the finalising of their bill—and bear in mind, being the biggest emitter in the world, they will set the framework, if you like, for the approach of so many developed countries at least and the developing countries—given that there is serious work that has not been done but could be done, should be done and can be done before the Copenhagen meeting, which could also play a part, including things such as the amendments that have been moved by the member for Lyne, it is not our intention to consider myriad technical amendments either by the government or by independent members.

We will ask the government again in the other house to very seriously consider deferring the vote until the new year, when we will have the benefit of knowing so much that is going to happen internationally over the next few months. In that sense and for those reasons we will not be supporting these amendments on this occasion.

9:42 am

Photo of Tony WindsorTony Windsor (New England, Independent) Share this | | Hansard source

I formally second the amendments as proposed by the member for Lyne. I listened with interest to the member for Goldstein. I opposed the legislation on the grounds of the five per cent target it sets. That is the only fixed thing in this legislation. I know there are arrangements, given global changes, to move to 25 per cent, but the only ‘known’ in this legislation is a five per cent target.

My opposition to the Carbon Pollution Reduction Scheme Bill 2009 is based on the fact that we are going to apply a market mechanism and virtually rearrange the whole Australian economy for a five per cent gain. I think that not only is against what the government stood for some time ago; it is against any common sense in relation to this particular issue. This is a very important issue. I agree with the parliamentary secretary when he said at the very start of today’s proceedings that the government accepts climate science. I am not a climate sceptic; I accept climate science. In fact I have had a private member’s bill before the parliament for some months now that has not been fully debated. To come into this place with a piece of legislation with a target of five per cent and use a market mechanism to achieve that target, in my view, is quite ridiculous. There are a whole range of other things outside the market mechanisms that could achieve that five per cent.

We have heard the parliamentary secretary talk about biochar and soil sequestration this morning. There are a whole range of domestic, personal and business related activities that can reduce emissions, whether they be carbon dioxide, nitrous oxide or methane. There are a whole range of available technologies out there now that can achieve that five per cent and more without going through this convoluted process—and a corrupted process, in my view, from what the original Garnaut report actually set out to achieve. We can achieve this without going through all those processes.

So, even though I am opposing the bill, I am doing so for different reasons to the opposition. I did support the deferral because I think, if five per cent is all this legislation is going for, it will achieve nothing. It probably will not—and neither should it—get through the Senate, so the extension of that logic is that it will be deferred one way or the other, and maybe we will revisit this issue with more common sense in terms of targets instead of this rather ridiculous five per cent. But I do formally second the member for Lyne’s amendments.

Photo of Harry JenkinsHarry Jenkins (Speaker) Share this | | Hansard source

I indicate to the member for New England that, in accordance with standing order 151, a detailed amendment does not require a seconder. It would seem to me to be a powerful tool for individual members, especially Independents.

9:46 am

Photo of Greg CombetGreg Combet (Charlton, Australian Labor Party, Parliamentary Secretary for Climate Change) Share this | | Hansard source

I thank the member for Lyne and the member for New England for their contributions in moving and seconding the proposed amendments. They are directed, as we have heard, towards giving the power to set scheme caps under the CPRS to the Climate Change Regulatory Authority.

Reference has been made to a number of the other measures that can be taken to address carbon pollution, and I just remind the member for New England, respectfully, that the government is pursuing many other initiatives, including supporting research into biochar, as I mentioned earlier. There is also significant financial support for the improvement of energy efficiency throughout our economy, support for greater fuel efficiency in motor vehicle manufacturing in this country and large investments to support solar technology. We will be pursuing our commitment to improvements in renewable energy, taking the target for renewable energy’s share of the national electricity supply to 20 per cent by the year 2020. That is expected to unleash $19 billion worth of investment in renewable energy research, development and commercialisation of technology. The government have also committed considerable funds towards endeavours to ensure that carbon capture and storage can be proven as a technology on a large scale and be commercialised. So quite a lot of measures have been taken.

I recognise the laudable intention behind the amendments moved by the member for Lyne and welcome the member’s recognition, too, of the serious challenge that climate change presents. The government decided, though, in the white paper that scheme caps and gateways should be set in regulations and therefore be subject to parliamentary scrutiny. The government took the decision on the basis that the scheme caps and gateways have potentially significant implications for the national economy. In the interests of accountability, elected representatives, in our view, rather than an independent regulator, as is proposed, should make the decisions about scheme caps and gateways. I note, though, that the CPRS Bill requires that when scheme cap regulations are tabled before the parliament the minister must, as soon as practicable, table a written statement setting out the minister’s reasons for making the recommendation to the Governor-General about those regulations. That is contained in part 2, clause 14(7) of the bill.

For those reasons, the government cannot accept the amendments moved by the member for Lyne. But I would like to thank the member for having the strength to move amendments like these, which are a constructive proposal and contribution to the debate—unlike, I might observe, the amendment moved by the Leader of the Opposition in the second reading debate.

Photo of Harry JenkinsHarry Jenkins (Speaker) Share this | | Hansard source

The question is that the amendments be agreed to.

A division having been called and the bells having been rung—

As there are fewer than five members on the side for the ayes, I declare the question resolved in the negative in accordance with standing order 127. The names of those members who are in the minority will be will be recorded in the Votes and Proceedings.

Question negatived, Mr Oakeshott, Mr Windsor and Mr Katter voting yes.

9:54 am

Photo of Greg CombetGreg Combet (Charlton, Australian Labor Party, Parliamentary Secretary for Climate Change) Share this | | Hansard source

by leave—I present a supplementary explanatory memorandum and move government amendments (1) to (144):

(1)    Clause 5, page 8 (line 1), omit the definition of carbon sequestration right, substitute:

carbon sequestration right:

             (a)    when used in relation to a reforestation project—has the meaning given by section 239A; or

             (b)    when used in relation to an area of land—has the meaning given by section 240.

(2)    Clause 5, page 9 (after line 21), after the definition of controlling corporation, insert:

control: a person has control of a reforestation project if:

             (a)    the person is the holder of the forestry right in relation to the project area or each of the project areas; or

             (b)    under a contract, or an arrangement, of a kind specified in the regulations, the person is entitled or required to establish, manage and maintain:

                   (i)    a forest on the project area; or

                  (ii)    a forest on each of the project areas.

(3)    Clause 5, page 11 (after line 1), after the definition of eligible financial year, insert:

eligible interest, in relation to an area of land, has the meaning given by section 241A or 241B.

(4)    Clause 5, page 14 (after line 27), after the definition of foreign person, insert:

forest maintenance obligation has the meaning given by section 226.

forest restoration order means an order under section 226C.

(5)    Clause 5, page 15 (after line 15), at the end of the definition of forest stand, add:

The regulations may provide that, for the purposes of this definition, trees and crown cover have the respective meanings given by the regulations.

(6)    Clause 5, page 21 (after line 21), after the definition of penalty unit, insert:

permitted forest activity has the meaning given by section 226.

(7)    Clause 5, page 22 (after line 8), after the definition of premises, insert:

prescribed non-CPRS reforestation scheme has the meaning given by the regulations.

(8)    Clause 5, page 22 (after line 28), after the definition of project area, insert:

project manager, in relation to a reforestation project, has the meaning given by section 197A.

(9)    Clause 5, page 24 (lines 27 and 28), omit the definition of relinquishment obligation transfer agreement.

(10)  Clause 5, page 25 (after line 12), after the definition of scheme, insert:

scheme obligation transfer agreement has the meaning given by section 197B.

(11)  Clause 5, page 26 (lines 23 and 24), omit the definition of transferee, substitute:

transferee, in relation to a scheme obligation transfer agreement, has the meaning given by section 197B.

(12)  Clause 35, page 84 (after line 8), after paragraph (1)(c), insert:

           (ca)    the supply mentioned in paragraph (a) was not into a prescribed wholesale gas market; and

(13)  Clause 49, page 94 (line 1), omit “Authority.”, substitute “Authority; and”.

(14)  Clause 49, page 94 (after line 1), at the end of subclause (5), add:

             (c)    if the person has an ABN—the person’s ABN.

(15)  Clause 79, page 124 (after line 28), after subparagraph (2)(b)(i), insert:

                 (ia)    if a controlling corporation of a group consented under subsection 74(3) to the making of the application for the certificate—the person is not a member of the group; or

(16)  Page 155 (after line 21), after clause 116B, insert:

116BA Equitable interests in relation to a Kyoto unit

        (1)    This Act does not affect:

             (a)    the creation of; or

             (b)    any dealings with; or

             (c)    the enforcement of;

equitable interests in relation to a Kyoto unit.

        (2)    Subsection (1) is enacted for the avoidance of doubt.

(17)  Page 162 (after line 2), after clause 122A, insert:

122AA Equitable interests in relation to a non-Kyoto international emissions unit

        (1)    This Act does not affect:

             (a)    the creation of; or

             (b)    any dealings with; or

             (c)    the enforcement of;

equitable interests in relation to a non-Kyoto international emissions unit.

        (2)    Subsection (1) is enacted for the avoidance of doubt.

(18)  Clause 129, page 171 (after line 3), after subclause (5), insert:

  (5AA)    An Australian emissions unit must not be surrendered in relation to the eligible financial year beginning on 1 July 2011 unless the unit has a vintage year of that eligible financial year.

(19)  Heading to subclause 143(3), page 184 (line 29), omit “Free”.

(20)  Clause 143, page 184 (line 33), omit “free”.

(21)  Clause 146, page 190 (lines 10 to 11), omit subclause (5).

(22)  Clause 173B, page 211 (after line 8), after paragraph (1)(a), insert:

           (aa)    the corporation is capable of complying with the request; and

(23)  Clause 173B, page 211 (line 9), omit “request.”, substitute “request; and”.

(24)  Clause 173B, page 211 (after line 9), at the end of subclause (1), add:

             (c)    the Minister notifies the Authority, in writing, that the Minister considers that the non-compliance is significant.

(25)  Clause 190, page 240 (line 16), omit “holder”, substitute “project manager (who may be the holder)”.

(26)  Clause 190, page 240 (lines 25 and 26), omit “on the holder of the forestry right”.

(27)  Clause 192, page 243 (lines 3 to 11), omit subclause (1), substitute:

        (1)    If:

             (a)    a person gives a reforestation report to the Authority; and

             (b)    the reforestation report is in respect of an eligible reforestation project for a reforestation reporting period;

the person may apply to the Authority for the issue to:

             (c)    if the person holds the carbon sequestration right in relation to the project—the person; or

             (d)    otherwise—the person who holds the carbon sequestration right in relation to the project;

of a certificate of reforestation in respect of the project for the period.

Note 1:  For reforestation report, see section 225.

Note 2:  For eligible reforestation project, see section 209.

Note 3:  For reforestation reporting period, see section 223 or 224.

Note 4:  For carbon sequestration right, see section 239A.

(28)  Clause 193, page 243 (line 18), before “An”, insert “(1)”.

(29)  Clause 193, page 243 (line 20), omit “Authority.”, substitute “Authority; and”.

(30)  Clause 193, page 243 (after line 20), after paragraph (b), insert:

             (c)    be accompanied by the fee (if any) specified in the regulations.

(31)  Clause 193, page 243 (before line 21), at the end of the clause, add:

        (2)    A fee specified under paragraph (1)(c) must not be such as to amount to taxation.

(32)  Clause 195, page 244 (line 8), omit “the Authority is satisfied that”.

(33)  Clause 195, page 244 (lines 10 and 11), omit “holds the carbon sequestration right in relation to”, substitute “is the project manager for”.

(34)  Clause 195, page 244 (after line 23), after paragraph (2)(f), insert:

            (fa)    the number that, under the regulations, is taken to be the carbon stock number for the project is greater than the number that, under the regulations, is taken to be the 2008 carbon stock number for the project; and

(35)  Clause 195, page 244 (line 30), omit “Note 1”, substitute “Note”.

(36)  Clause 195, page 244 (line 31), omit note 2.

(37)  Clause 195, page 245 (after line 9), after subclause (3), insert:

     (3A)    For the purposes of subsection (3), if:

             (a)    a forest stand is situated wholly or partly on Torrens system land; and

             (b)    the Authority is not satisfied that appropriate entries or notations have been made under section 236 in relation to the land by the relevant land registration official referred to in that section;

disregard the forest stand.

(38)  Clause 195, page 245 (after line 23), after subclause (6), insert:

Copy of certificate to be given to project manager if project manager does not hold the carbon sequestration right

     (6A)    If:

             (a)    the Authority issues a certificate of reforestation to the person who holds the carbon sequestration right in relation to the project; and

             (b)    that person is not the project manager for the project;

the Authority must give a copy of the certificate to the project manager for the project.

(39)  Clause 195, page 246 (lines 1 to 5), omit subclause (8).

(40)  Clause 196, page 247 (after line 2), after subclause (3), insert:

     (3A)    For the purposes of subsection (2), if:

             (a)    a forest stand became part of an eligible reforestation project as the result of a variation of a section 209 declaration; and

             (b)    the variation took effect after the day the section 209 declaration took effect;

then, for the purposes of the application of that subsection to the eligible reforestation project, disregard anything that occurred in relation to the forest stand before the day on which the variation took effect.

(41)  Clause 196, page 247 (lines 3 to 6), omit subclause (4).

(42)  Page 247 (after line 8), after Division 3, insert:

Division 3A—Project managers

197A Project manager for a reforestation project

        (1)    For the purposes of this Act, the project manager for a reforestation project is:

             (a)    if a scheme obligation transfer agreement is in force in relation to the project—the person who, under that agreement, accepts responsibility for complying with any requirements that may be imposed by or under this Act or the associated provisions on the person in the person’s capacity as project manager for the project; or

             (b)    otherwise—the person who holds the carbon sequestration right in relation to the project.

        (2)    To avoid doubt, the continuity of a person’s status as the project manager for a reforestation project is not affected by:

             (a)    a transfer of the carbon sequestration right in relation to the project; or

             (b)    if the project is an eligible reforestation project—the variation of the section 209 declaration of the eligible reforestation project.

        (3)    To avoid doubt, if:

             (a)    a person becomes subject to a requirement to relinquish Australian emissions units in the person’s capacity as project manager for an eligible reforestation project; and

             (b)    before that requirement was met, the person ceased to be the project manager for the project;

the cessation does not affect the continuity of the requirement.

197B Scheme obligation transfer agreement

        (1)    For the purposes of this Act, a scheme obligation transfer agreement in relation to a reforestation project is an agreement, where:

             (a)    the agreement is between:

                   (i)    the person who, immediately before the agreement was entered into, was the project manager for the project; and

                  (ii)    another person (the transferee); and

             (b)    the agreement states that the transferee accepts responsibility for complying with any requirements that may be imposed by or under this Act or the associated provisions on the transferee in the transferee’s capacity as project manager for the project; and

             (c)    the Authority has given written approval to the agreement; and

             (d)    if the Authority, in accordance with the regulations, requires the transferee to give security to the Commonwealth in relation to the fulfilment by the transferee of any requirements to relinquish Australian emissions units that may be imposed on the transferee under this Part in relation to the project—the transferee has given that security; and

             (e)    the holder of the carbon sequestration right in relation to the project:

                   (i)    has consented, in writing, to the making of the agreement; or

                  (ii)    is a party to the agreement; and

              (f)    such other conditions (if any) as are specified in the regulations are satisfied.

Criteria for approval of agreement

        (2)    The Authority must not, under paragraph (1)(c), give approval to an agreement that relates to a reforestation project unless:

             (a)    the transferee is a recognised reforestation entity; and

             (b)    if the transferee neither holds, nor is likely to hold, the carbon sequestration right in relation to the project:

                   (i)    the transferee is not an individual; and

                  (ii)    the Authority is satisfied that the transferee has, or is likely to have, control of the project; and

             (c)    the Authority is satisfied that the transferee has, and is likely to continue to have:

                   (i)    the capacity; and

                  (ii)    the financial resources;

                      necessary for the transferee to comply with any requirements that may be imposed by or under this Act or the associated provisions on the transferee in the transferee’s capacity as project manager for the project; and

             (d)    if:

                   (i)    the project is or was an eligible reforestation project; and

                  (ii)    a notice was given under section 232 or 233 in relation to the reforestation project; and

                 (iii)    the notice required a person to relinquish a particular number of Australian emissions units; and

                 (iv)    the person did not comply with the requirement within 90 days after the notice was given;

                      the penalty payable under section 287 in respect of the non-compliance with the requirement (including any late payment penalty payable under section 288 in relation to the section 287 penalty) has been paid in full.

Duration of agreement

        (3)    A scheme obligation transfer agreement:

             (a)    comes into force:

                   (i)    at the time when the agreement is approved by the Authority under paragraph (1)(c); or

                  (ii)    at such later time as is specified by the Authority in the instrument of approval; and

             (b)    remains in force until whichever of the following happens first:

                   (i)    the agreement is cancelled under section 197C;

                  (ii)    another scheme obligation transfer agreement comes into force, and the other agreement is expressed to replace the first-mentioned agreement;

                 (iii)    the transferee ceases to exist.

        (4)    To avoid doubt, if:

             (a)    a scheme obligation transfer agreement is in force in relation to a reforestation project; and

             (b)    the carbon sequestration right in relation to the project is transferred;

the transfer does not affect the continuity of the agreement.

        (5)    To avoid doubt, if:

             (a)    a scheme obligation transfer agreement is in force in relation to an eligible reforestation project; and

             (b)    the relevant section 209 declaration is varied;

the variation does not affect the continuity of the agreement.

Agreement is not a legislative instrument

        (6)    A scheme obligation transfer agreement is not a legislative instrument.

197C Holder of carbon sequestration right may elect to assume scheme obligations


             (a)    a scheme obligation transfer agreement is in force in relation to a reforestation project; and

             (b)    the person who holds the carbon sequestration right in relation to the project is a recognised reforestation entity;


             (c)    the holder may, by written notice given to the Authority, elect to accept responsibility for complying with any requirements that may be imposed by or under this Act or the associated provisions on the holder in the holder’s capacity as project manager for the project; and

             (d)    if the holder does so—the agreement is cancelled.

(43)  Clause 209, page 256 (lines 1 to 3), omit paragraph (4)(b).

(44)  Clause 209, page 256 (line 4), omit “applicant”, substitute “project manager for the project”.

(45)  Clause 209, page 256 (lines 5 and 6), omit paragraph (4)(d), substitute:

             (d)    the applicant is the project manager for the project; and

           (da)    a single person (who may be the applicant) holds the carbon sequestration right in relation to the project; and

           (db)    if the applicant does not hold the carbon sequestration right in relation to the project—the holder of the carbon sequestration right in relation to the project has consented, in writing, to the making of the application; and

(46)  Clause 209, page 256 (lines 7 to 18), omit paragraph (4)(e), substitute:

             (e)    each of the following has consented, in writing, to the making of the application:

                   (i)    each person (other than the applicant) who holds an eligible interest in the project area or any of the project areas;

                  (ii)    a person specified in the regulations; and

(47)  Clause 209, page 256 (after line 21), after subparagraph (4)(f)(i), insert:

                 (ia)    the project area is not, or the project areas are not, Torrens system land; and

(48)  Clause 209, page 256 (lines 26 and 27), omit subparagraph (4)(f)(iii), substitute:

                 (iii)    the person identified in the application as the holder of the carbon sequestration right in relation to the project holds that right; and

(49)  Clause 209, page 256 (line 36), omit “, or the project areas are,”.

(50)  Clause 209, page 257 (line 2), omit “or project areas”.

(51)  Clause 209, page 257 (line 3), omit “, or the project areas are not,”.

(52)  Clause 209, page 257 (line 5), omit “, or the project areas are not,”.

(53)  Clause 209, page 257 (after line 8), after subclause (5), insert:

     (5A)    A consent under paragraph (4)(e) must be in a form approved, in writing, by the Authority.

(54)  Clause 209, page 257 (lines 29 to 32), omit subclause (9), substitute:

Notification of declaration

        (9)    As soon as practicable after making a declaration under subsection (2), the Authority must give a copy of the declaration to:

             (a)    the applicant; and

             (b)    if the applicant does not hold the carbon sequestration right in relation to the project—the person who holds the carbon sequestration right in relation to the project.

(55)  Clause 212, page 260 (lines 14 to 16), omit paragraph (3)(b).

(56)  Clause 212, page 260 (line 17), omit “applicant”, substitute “project manager for the project”.

(57)  Clause 212, page 260 (lines 18 and 19), omit paragraph (3)(d), substitute:

             (d)    the applicant is the project manager for the varied project; and

           (da)    a single person (who may be the applicant) holds the carbon

9:58 am

Photo of Darren ChesterDarren Chester (Gippsland, National Party) Share this | | Hansard source

I thank the House for this opportunity, but I must say that I am disappointed that many members have not had the chance to speak more fulsomely during this debate. Many in the government are desperate to secure a political advantage at every opportunity and like to typecast any voices of dissent in this debate as somehow being climate change sceptics or heretics. The Prime Minister himself is in the habit of claiming that, if you do not support his CPRS legislation, you do not care about the future of the Great Barrier Reef or Kakadu. It is a childish and simplistic attack that fails to recognise the basic truth: Australia contributes less than two per cent of total global emissions and anything we do in isolation to reduce those emissions will do virtually nothing to improve the global environment. There is no Australian solution to this problem; there is only a global solution. This should be an issue of science and economics, not politics and some sort of green religion.

The hypocrisy of the government’s position in the environmental debate is found right across Australia, where cuts have been made to practical environmental initiatives such as the Landcare movement, while government MPs keep spinning their lines on climate change. This is the great con by the Labor Party when it comes to environmental issues at both state and federal level. There is a long list of grand but otherwise empty statements followed up by very little action on the ground, where the work needs to be done to maintain and enhance the natural environment.

As a member of both Landcare and Watermark, two groups in the Gippsland area that are committed to practical environmental initiatives, I am constantly amazed by the determination and dedication of many country people, particularly landowners, to maintain and enhance their local environment. There are hundreds of people in Gippsland who are prepared to get their hands dirty and do the practical environmental work, which this government is failing to support. Farmers and rural landholders are the practical environmentalists of this nation. They have a vested interest in caring for the land and they are keen observers of the weather and the longer term climate patterns. The feedback I am receiving in Gippsland in relation to this legislation is that they are worried about the long-term drought and they are investigating different techniques and investing in new ways to manage their properties. However, they are also telling me that this is nothing new. Farmers in Australia have always faced the challenge of growing our nation’s food and fibre in a difficult and variable climate. That is not to say they do not believe the climate is changing; it is simply to make the point that they are innovative and ready to adapt if they are not crushed by the heavy hand of government regulation. I fear that the CPRS legislation before the House poses a far greater risk to the future of Australian agriculture than much of the climate change forecasts.

My record in relation to the climate change debate is clear for all to see. I spoke on this topic during my maiden speech and told the House that Gippslanders are at the pointy end of the climate change debate. It is the families who rely on incomes from industries such as power generation at Latrobe Valley and farming who will bear the brunt of any decisions for Australia to go it alone without a worldwide agreement. I repeat my earlier remarks: given our nation’s contribution to global emissions is less than two per cent, any policy that sacrifices jobs in my region will be met with strong resistance by the local community. As I also indicated in my maiden speech, if we are prepared to give the planet the benefit of the doubt and we accept that climate change is real, then we are going to need a strong and sustainable economy to deal with the challenges it presents.

The coalition has put forward a practical and common-sense plan to deal with many of these issues. Amidst all of the hyperbole and the empty rhetoric from those opposite, the Liberal and National MPs in this place, and Independents, to a large extent have shown a willingness to engage in the debate and put forward some very positive alternatives. To begin with, we sought to delay consideration of the CPRS legislation until we had a clearer picture of the position that would be adopted by the world’s largest nations and the biggest contributors to total global emissions. This is a practical and common-sense approach and we have the time to get our response right. The issue of sustainable environmental management is on the public agenda to stay and we must deal with its challenges in the context of a sustainable economy. Under the Rudd government’s model before the House, we run the risk of jobs being exported from Australia to nations which do not have a comparable scheme. A fear that is regularly expressed to me in my electorate is that we will be sending our jobs offshore. We will also export our carbon emissions to those nations, and the net result will be deterioration in the world’s environment because the nations that take the jobs will have less stringent environmental protocols than Australia.

Again, the opposition’s position is balanced, it is reasonable and it is practical. The government should be having a genuine conversation with the Australian public on this issue without all of the propaganda and the rhetoric. Last year we had the spectacle of the government funding a propaganda advertising campaign which effectively raised fears in the community. I believe that is an appalling betrayal of the Australian public. There is genuine concern in our community about environmental issues, but this government is doing nothing to allay those concerns; it is ramping up the rhetoric and seeking to score political points.

As I said earlier, this is a matter of science and economics. I am a firm believer in the capacity of the human mind to develop solutions to seemingly unresolvable problems. The ingenuity of the human race has overcome many challenges in the past and it will do so in the future. Instead of funding these advertising propaganda campaigns to scare the community into voting Labor, why doesn’t this government put that additional money into practical environmental initiatives or increased research? The government portrays its trading scheme as the only way to reduce CO2 emissions, but the reality is far different. Time prevents me from exploring every option in detail, and I thank the House for the opportunity—(Time expired)

10:03 am

Photo of James BidgoodJames Bidgood (Dawson, Australian Labor Party) Share this | | Hansard source

I rise to speak in support of the Carbon Pollution Reduction Scheme Bill 2009 and related bills. Those opposite could never take the strong and decisive action of the Rudd Labor government because they are weak and divided on this issue and a range of other issues that are important to the future of this nation. The member for Wentworth and the Liberal Party remain divided, and to this day are still debating whether climate change even exists. As for the Nationals in this place, their position on this issue is clear: the leader of the Nationals in the other place thinks it is a good idea to drill for oil in Antarctica—enough said!

I am passionate about jobs, and if we do not act now Australia’s economy will be left behind, meaning we will not create the jobs of the future—the low-pollution, green-collar jobs that will be needed as we go forward. In my electorate of Dawson, Mackay Sugar’s long-planned cogeneration electricity plant is a step closer to being a reality thanks to our government’s commitment to tackling climate change. Mackay Sugar’s cogeneration plant, to be located at Racecourse sugar mill, will use sugarcane bagasse, a waste product from the production of sugar, to produce a plant that could generate up to one-third of Mackay’s electricity needs. These technologies could lead to biofuel capacities and ethanol production. Projects like these are made feasible by our renewable energy targets and the CPRS. This is a $110 million project which has been sitting on the books for over 10 years due to inaction by the other side of this House.

Deferring action now is not an option. The reality is we will face long-term costs that will be around 15 per cent higher if we do not take action now. Treasury modelling released in October 2008 shows that measures created in this bill will see the renewable energy sector grow up to 30 times its current size by 2050, creating thousands of new jobs. That is good news, that is exciting news. Many of the workers in the Bowen Basin coalmines have their homes, their families and their children in my electorate. In my first speech in this House I said that Labor is the miner’s friend—always has been, always will be. We are delivering on that promise by supporting the coal industry towards reducing its carbon emissions. We are doing this because the Rudd Labor government recognise and understand the vital importance of the coal industry. It is our biggest export industry, a major employer and a driver of economic growth for the country.

The decision to delay the CPRS by a year and have a soft-start fixed-permit price of $10 will also assist the coal industry in the Bowen Basin. These changes that I have been pushing for help support jobs in Dawson. We are being pragmatic in our support by providing significant funding for research and development of carbon capture and storage, known as CCS. These are innovative technologies of the future. There is $100 million to accelerate deployment of commercial-scale CCS projects globally through the Australian led Global Carbon Capture and Storage Institute. There is the very significant $2.4 billion in Commonwealth funding for carbon capture and storage that will help leverage $1 billion in industry funding and around $500 million in state government funding.

I believe in a coal industry with a future. I believe that investment will continue to flow into the coal industry. For example, in May of this year there was an announcement from Waratah Coal that a proposed mining project in Alpha will generate 6,000 jobs. That will be worth $7.5 billion. This is an exciting project plan to use Abbot Point coal terminal, located near the town of Bowen in my electorate, to export its coal. This is great news for the people of Dawson. The government has outlined $750 million in transitional assistance, targeted at the mines that are suffering from these higher carbon liabilities. The government will continue to engage with the industry to ensure that this money is targeted in the best way possible. Stakeholders in the industry understand when Waratah Coal’s Peter Lynch said:

I don’t think that the CPRS is going to have enough of an impact to present insurmountable problems.

These sentiments were reiterated by Rio Tinto, for whom it is one of the ‘greatest challenges’ and also one of the greatest ‘opportunities’. There is political will to see this legislation go through this House. This is important legislation for the future of the coal industry. We on this side of the House and I, standing for the people of Dawson, wholeheartedly commend this bill to the House.

10:08 am

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

The Carbon Pollution Reduction Scheme Bill 2009 before the House is an important issue for every Australian. The legislation we have before us will result in a quantum shift in the ways in which financial markets operate, resources are allocated and wealth is distributed within our economy. The issue of climate change demands a coordinated, global response. It is an issue on which no country can go it alone, particularly a country whose population is as small as Australia’s. It is vital that Australia’s response to climate change be consistent with other major economies, that it be the subject of rigorous assessment using the very latest available data and that the decisions be made from an informed viewpoint.

I believe that the average Australian would consider it prudent to reserve a decision on an ETS until we know the outcome of the Copenhagen conference, the direction that the world community will take and the final direction of US legislation. It is clear to all except the Labor Party and this Prime Minister that the scheme adopted by the world’s largest economy will be pivotal to the global response on climate change. I also believe that the average Australian would consider it prudent that any consideration of an ETS should take into account the impact of the current financial downturn, but Labor chooses to ignore these factors and to make an unsubstantiated value judgment that the fate of the planet rests with the immediate passage of this flawed legislation.

The simple fact is that Labor’s political interests are best served by the passage of this legislation. The interests of the Australian people and the planet are being left a distant second. Why would the opposition support Labor’s flawed scheme when we are provided with no analysis of the impact of a delayed start by our competitors? Why would the opposition support Labor’s flawed scheme when the current economic conditions have not been taken into account by the government? Why would the opposition support Labor’s flawed scheme when there has been no empirical analysis of alternatives? We certainly will not do so simply because the Prime Minister says there is no other way. The opposition is fully aware that there are other ways and better outcomes.

The Nationals are particularly concerned about the impact of Labor’s flawed scheme on regional Australia. Research by the New South Wales government, which is no friend of the coalition, found that regional centres across Australia would shrink by 20 per cent. Would that worry this Prime Minister? Clearly not. His primary concern is the 10-second sound bite and the 24-hour news cycle. I am greatly concerned at its impact on low-income earners in my electorate. The Prime Minister puts forward this scheme as some form of magic pudding where everyone benefits and no-one pays. Nothing could be further from the truth. The purpose of an emissions trading scheme is to change behaviour, and it achieves that through price signals. The cost of carbon will, over time, be factored into everything we buy and every service we use.

The Prime Minister and the Labor Party are perpetuating an illusion that low-income earners will be compensated for the cost of an ETS. The reality is that we will all pay and low-income earners will be hardest hit. Low-income earners are asking me how adequate that compensation will be and how long it will last. The answer is that it is reviewable after five years, and we know how much this Prime Minister loves reviews. The very real risk is that the compensation will be phased out and legislation could be introduced to remove that compensation even sooner than five years from now. The reality is that the purpose of an ETS is to inflict economic pain. That is how the change in behaviour is achieved and low-income earners will feel the pain the most.

Employment in any area is of concern, and on the North Coast of New South Wales it is of particular concern. The opposition is gravely concerned that the ETS will destroy jobs and reduce economic growth. Unemployment is far too high in coastal areas and with the added burden of an ETS—a very badly designed ETS, as this one is—unemployment will be driven higher. The Labor Party drones on about the need for certainty. The people I represent do not need the certainty of increased unemployment, the certainty of reduced living standards by virtue of this flawed scheme or the certainty of knowing that they will pay more for everything they buy.  This is a poorly considered, rushed piece of legislation that is designed purely to serve Labor’s political interests. It will not benefit the environment. It will export jobs and it will export CO2 emissions.

10:12 am

Photo of Damian HaleDamian Hale (Solomon, Australian Labor Party) Share this | | Hansard source

I thank the House for the opportunity to speak in support of the Carbon Pollution Reduction Scheme Bill 2009 and related bills and to outline the significance of the scheme to the people of Australia and, specifically, the hardworking people in my seat of Solomon. This scheme strikes the right balance between supporting growth and jobs now and delivering carbon reduction. The Carbon Pollution Reduction Scheme will ensure that Australia invests in the industries of the future, such as renewable energy, solar energy and wind farms, as well is in jobs that use new technology, such as clean coal and geothermal energy, thus creating thousands of new low-pollution jobs. We on this side of the House have been very mindful of the potential impact on jobs, particularly during these difficult economic times. That is why we have taken the responsible action of delaying the start of the scheme for one year and committing to a fixed price phase from 1 July 2011 to 30 June 2012.

This government, through the work of both the Minister for Climate Change and Water and the Parliamentary Secretary for Climate Change, is delivering strong action to tackle climate change. The Rudd government is committed to creating low-pollution jobs for the future as part of our comprehensive approach to combating climate change. The Carbon Pollution Reduction Scheme will see for the first time a cost put on carbon pollution, which will encourage major polluting businesses to lower their emissions. Funds raised will assist households to adjust to the scheme, making sure Australian families do not carry the cost of climate change. Through our tackling of climate change we will see the renewable energy sector grow to 30 times its current size by 2050, thereby creating thousands of new jobs. With that in mind, over $13 billion has been committed to programs that will increase the demand for low-pollution jobs, products and services. We are helping business to invest in energy efficiency and to develop and commercialise new low-carbon and renewable products in transport and energy generation. These measures will support the development of the industries around energy efficiency and low-carbon transport as well as energy production and renewable energy production. Jobs will be created in new and established industries alike and be spread throughout Australia.

Scientists agree that carbon pollution is causing the world’s climate to change. This change is resulting in more extreme weather events, higher temperatures, more droughts and rising sea levels, all of which have significant consequences for the people in Solomon and the Northern Territory. Scientific research tells us that the Top End is likely to become hotter and wetter and the Centre hotter and drier. The frequency and intensity of extreme weather events such as tropical cyclones or storm surges is likely to increase. Rises in temperatures could lead to the loss of 80 per cent of the freshwater wetlands in Kakadu. Rising sea levels, increased frequency of tropical cyclones and extreme weather events are likely to significantly impact on biodiversity, critical habitats, tourism, and food and cultural values important to the traditional landowners. Science suggests that uncontrolled climate change could see real threats to coastal housing and infrastructure, tropical diseases becoming more common, particularly amongst the elderly, and more people suffering from heat related illnesses, and death. So, when politicians say that Australia should wait until after a global deal is struck to take any action on climate change, they are in effect arguing for Australia to surrender to these effects of climate change.

Australia is one of the hottest and driest continents on earth. Our environment and economy will be one of the hardest and fastest hit by climate change if we do not act now. In global terms, Australia pollutes at high levels for a country of our size. In fact, on a per capita basis we are the sixth largest polluter in the world. Leadership from the developed world encourages other countries to join the global fight. By introducing the Carbon Pollution Reduction Scheme, Australia will be a part of the solution, not just the problem. The world will come together to attempt to reach a new global agreement on climate change in December this year, and as the Prime Minister said yesterday regarding the position of the opposition:

There are national interest questions here. Business certainty is necessary. The future of our regulatory environment as it affects the emissions-intensive trade-exposed sector of the economy and other sectors of the constitution is of vital relevance for future business certainty.

               …            …            …

The national interest actually demands some action on the part of the Leader of the Opposition. Take some leadership. Take on the sceptics in your own party. Actually forge a position on behalf of the coalition. Show some leadership on climate change. … We need business certainty for Australia’s future.

I could not agree more with my Prime Minister. I commend this bill to the House.

10:17 am

Photo of Mrs Bronwyn BishopMrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | | Hansard source

This the first time we have had a fair dinkum opportunity to debate this question. It was sloganeering from one end of the country to the other until we actually got a bill. Then the government decided that it was going to restrict the opportunity to speak so that people like me are only allowed to have five minutes and could not even speak on the second reading. That is about as sensible as this government can get, I suppose. The euphemistic title of ‘Carbon Pollution Reduction Scheme’ must have been dreamt up by their best spin doctors. This is an ETS, an emissions trading scheme. If it looks like an ETS and it smells like an ETS and it quacks like an ETS, it is an ETS!

There are two very salient points that I would like to make in the five minutes available. The first is this. The government was euphoric yesterday when it saw that for the first quarter of 2009 we did not in fact see GDP fall into decline. We had a very small growth. I took the trouble to look at the figures to see precisely why that was so. The main target of this ETS proposal is to attack the biggest enemy that the people who are the green believers have, and that is coal. Yet the real irony is that the reason our GDP did not shrink for the first quarter is because coal exports held up. In fact, in that quarter we exported $12.8 billion of coal. We also exported $13 billion of metal ores and $3.4 billion of rural products. The two sectors that will be hit hardest by this ill-thought-out, fundamentally flawed legislation, which I am pleased we will be voting against, are the rural sector and the coal sector, and coal provides the vast majority of electricity for the people of Australia.

Yet nowhere is there an honest declaration of the fact that this scheme will put up the cost of everything that happens in our economy. We heard the CEO of Santos on radio the other day say that the reason he might support this legislation was that, as long as the price of coal went up—and I am paraphrasing his words—so that it made his product of gas competitive, it would be a good idea. In other words, we are introducing a tax to make what is a cheap source of energy for this country expensive so that the producers of some other products can in fact say that they will give us our source of energy. At the same time we are depending on the exports of that very same commodity to keep our GDP growing. What hypocrisy is this!

The second point that I would like to make concerns a very interesting article I came across in the New York Times, and it concerns a debate which is yet to be had. If we are serious about carbon pollution we should be discussing black carbon—soot—and we should be discussing people. The really shocking part of what I am going to talk about now is that something is going to be done about the appalling conditions in which tens of thousands of people live right across India and Africa and Asia—with their cooking stoves, using dung to cook their food, destroying the lungs of their children and the women—only because doing something might serve some vested interest. We are only going to talk about doing something, about giving them new stoves, because it might serve the great god of greenhouse gases. It would not be because it has been killing the kids or because these women have had no quality of life but because someone finds that it will assist their argument on climate change.

The final paragraph of this article reads this way—and I might say that the person who is propounding the need to look at black soot is Dr Ramanathan, who is a former member of the IPCC. He is the eminent man on black soot and he is the man who says that something has to be done about changing those stoves. The person working with him says:

I’m not going to go to the villagers and say CO2 is rising, and in 50 years you might have floods. I’ll tell her about the lungs and her kids and I know it will help with climate change as well.

There is a time in this debate when we have to be honest and say we have to put people first, have the argument that is fair dinkum and look at the real issues that have to be addressed before we launch into such legislation.

10:23 am

Photo of Bernie RipollBernie Ripoll (Oxley, Australian Labor Party) Share this | | Hansard source

This week the US car giant General Motors, the world’s largest car manufacturer, went into voluntary administration and is bankrupt. In the process, thousands of jobs will disappear and communities will suffer, just as they have done over the past 20 years when GM were making record profits and shoving jobs overseas. Many will be shocked and will ask the question: how could this have happened? While hindsight is a wonderful thing, it was not needed in the case of GM and other monoliths that refused to change and adapt. The same could be said about economies that refuse to accept climate change and its consequence in the long term. But reward will come to those that adapt early and create new industries and carbon economies into the future. Yes, there is a cost but it is an inevitable cost that is best dealt with in a planned and measured way, a cost that can be mitigated through a strategic plan.

None of us know what the world will look like in 50 years, but what we do know is that it will not look like it does today. In 50 years time when the world and global economies are fully integrated into carbon economies, with alternative energy use and pollution reduction, people will look back at this period in our history and question why we argued at all. Our children as future leaders will ask why, in the face of all that we know must be done, we did not act more quickly and why we debated the minor detail when the course of action was always clear. Some will say that, had we acted more quickly, others would have followed sooner. Other economies and nations not as courageous or without the foresight—just like GM—will lament why we took so long to act as global leaders. It has often been a historic fact that great change comes from humble beginnings—perhaps as humble as a small nation such as Australia taking first steps.

On any difficult matter, leadership is hard. History teaches us that lesson repeatedly. Leadership also teaches us that many will say no and stand in the way. There are those that are frightened into inaction or blinded by ology. There are those who just sit and wait. Maybe this sounds all too familiar for people in this chamber. The opportunity to take action on climate change, carbon pollution and the new carbon economy is now—and that is what this government is doing. In contrast, the Liberal and National parties’ position of the past is destroyed by the reality that they cannot even agree amongst themselves. But, sadly, the Liberal and National parties have only one position, and that is to oppose completely and to delay indefinitely.

The Australian people at the last election made clear their view and expectation for the parliament, and as a government we will uphold that commitment on climate change. As Treasury modelling and Professor Garnaut’s review have shown, the costs of inaction are far greater than the costs of responsible action today. The Carbon Pollution Reduction Scheme is to start in 2011 and for the first time it will put a cost on carbon pollution, which will encourage major polluting businesses to lower their emissions. It will also encourage them to modernise, to be more efficient and to be more competitive. We will use the funds raised to assist households in making sure that Australian families do not unjustifiably carry the cost of climate change.

We will build on our investment in renewable energy to create the low-pollution jobs of the future in solar energy and on wind farms and jobs using new technologies like clean coal and geothermal energy. Taking action on climate change will see the renewable energy sector grow to 30 times its current size by 2050, creating thousands of new jobs. Schemes already exist in 27 European countries. In the United States and Canada 28 states and provinces are introducing emissions trading to reduce carbon pollution, as is New Zealand. US President Obama has committed to establishing a cap-and-trade system to reduce carbon emissions with targets for reduce those emissions. We are not alone but we still need to lead.

This government will not leave workers out in the cold. We will provide substantial assistance to support the jobs of today into the future. We will allocate free permits to firms engaged in emissions-intensive trade-exposed activities. The $3.9 billion electricity sector adjustment schemes will also help, and the $2.75 billion Climate Change Action Fund will also work to minimise the impact. The reality is that Australian business is doing it tough, and we will support them with the new global recession buffer and a one-year fixed period will also be introduced. Given the financial crisis, these targets are appropriate and responsible and they get the balance right. We have the right balance. We will deliver crucial reform but we will also mitigate the worst impacts on the community. We will protect our economy and jobs during this crisis and we will help Australians to transition to a low-pollution economy that can create jobs into the future.

In conclusion, economic circumstances are constantly changing. They have changed in the past and they will do so in the future. But fear of change should not paralyse us from action. The Carbon Pollution Reduction Scheme is a critical economic reform to protect our economy now and to position Australia into the future.

10:28 am

Photo of Nola MarinoNola Marino (Forrest, Liberal Party) Share this | | Hansard source

The coalition cannot support this seriously flawed legislation that will lead to job losses for Australian workers without materially cutting our 1.4 per cent of the world’s carbon emissions. This legislation will export jobs, investment and emissions through the design flaws in this emissions trading scheme. Some of the flaws in this complex scheme are quite fundamental. I have coal-fired electricity generators in my electorate. Under this legislation they have simply been assumed away. The legislation is framed around the national energy market which operates a gross pool system, allowing costs to be passed through in the way electricity is sold.

WA is an energy island. The market is primarily a bilateral contract system with long-term contracts of typically 15 years, with a minor percentage of the market traded. Unless several years ago a generator made provision for carbon costs, the generator will have to pay this cost under the proposed scheme. There is no transitional allowance at all for the private energy generator in WA.

A further structural flaw is the treatment of fugitive emissions. Collie has been allocated the highest default factor when the state mining engineer acknowledged that Collie coal does not produce methane. I have a major alumina refinery in my electorate which operates in a global market where prices are set by international supply and demand. In the words of the Aluminium Council, our major concern with the proposed CPRS and renewable energy target is the magnitude of costs being imposed on Australia producers that is not being imposed on competing suppliers from other countries.

Costs of tens of millions of dollars per site will be imposed only on Australian producers. Given the ETS represents a major structural change, the government should have provided complete detailed analysis and modelling of the costs of the scheme, how it affects each industry and regional community and whether it is the most cost-effective option for Australia to reduce its emissions. Industries need a globally competitive, level playing field. The proposed US emissions legislation will provide 100 per cent protection to US export and import competing industries until 2025.

Coming from the dairy industry, I well understand how difficult it is to compete in global markets without a level playing field. My industry competes with heavily subsidised competitors that have a direct economic advantage. We have lost numbers of farmers, jobs, small businesses, investments and Australian owned processors. It has come at a huge social and economic cost. Any assumption that we should be first to make concessions and the rest of the trading world will do the same—the assumption the Rudd government is making—is wrong. Farmers and exporters will continue to carry the cost. Treasury modelling has not even considered any impacts on agriculture. We know that the agricultural, horticultural and viticultural industries will, under this scheme, now also have to compete with imported products from countries that have the advantage of no flow-on costs from the creation of an ETS. The forestry industry has been excluded as well.

No-one in my electorate should underestimate the very direct impacts this flawed ETS will have on every individual, business and industry—mining and resources, manufacturing, agriculture, forestry and tourism, every small, medium and large business as well as every home and family. That is why, prior to the introduction of an ETS, it is essential that we see a Productivity Commission review, the Copenhagen decisions and US legislation are known and there is coordinated global action.

For Australia to implement a flawed, complex, bureaucratic emissions trading scheme which fails to make a measurable impact on reducing global emissions would cost Australian jobs, affect industrial output and investment, damage the economy and increase the cost of living for Australians. Yes, businesses and individuals in Australia need to be globally competitive and environmentally effective in their emissions mitigation decisions. Businesses do need certainty—I agree. They need certainty that they will actually still be in business after the introduction of this government’s flawed emissions trading scheme legislation. I do not support these amendments.

10:32 am

Photo of Tony WindsorTony Windsor (New England, Independent) Share this | | Hansard source

I draw the attention of the Parliamentary Secretary for Climate Change to some of the arguments that have been made inside this place and outside this place in relation to the measurement of soil carbon and whether that will be part of the Copenhagen discussions and Kyoto measures into the future. According to some, reafforestation could address some of the issues that the proposed amendments attempt to deal with. There is the capacity for the sequestration right to hold for a period of years. I have heard queries as to whether the carbon that is being stored will, in a simplistic sense, be available for the market at certain times as it grows. Similar issues are being explored regarding soil carbon depth, soil type, drought et cetera. So I would like the parliamentary secretary to comment on the veracity of the science that is involved in the sequestration right as it relates to forestry.

I think the member for Mackellar raised some very interesting points a moment go, and the member for Cowper and other members spoke about cost to agriculture—and I have seen many of the documents as well. As I said, I am opposed to this legislation, but I am not opposed to doing something about the problem. I am not opposed to an emissions trading scheme that is properly structured, but one that has a target level of only five per cent, I think, would create a whole economic mechanism for no real gain.

My electorate of New England is in the Murray-Darling Basin and these amendments affect the basin because reafforestation potentially has not only positive aspects involving carbon storage but negative aspects in the form of basin run-off. For those who are loosely described as climate sceptics, I make this point: if the Murray-Darling, as some climate scientists are saying, were to suffer a reduction of up to 30 per cent of run-off through the changes to the climate, this message being peddled by the National Party particularly that, if we take action, agriculture will bear a burden is nonsense. What if we do nothing and the scientists are proved right in 40 or 50 years? That is when the penalty will be paid by the farm sector. I would rather be doing something now than not doing anything at all and having people look back and say, ‘Why didn’t they act?’ If we ever need an example of that, we need only look at the Murray-Darling and the legislation that we have dealt with in this place in recent years. We recognise that what we did was wrong and now we are trying to fix it.

So I stress to members that when we are debating this subject we are not debating who is in government and who may be in government next year or the year after; we are really debating things that will not have a significant impact on us immediately but will potentially affect those who follow us. As I said, I would rather be on the side of action than on the side of inaction. If the steps we take amount to overkill, that will only be a positive for the globe.

I do not question the government’s motives, but I do not think that legislation with this headline banner and a five per cent number will have any meaningful impact on achieving those long-term goals. As I said earlier, the five per cent could be achieved by not going anywhere near a market mechanism. It could be achieved partly through reafforestation as well as through renewable energy et cetera. I oppose the amendments and urge all members to consider some of the broader long-term issues. (Time expired)

10:37 am

Photo of Alex HawkeAlex Hawke (Mitchell, Liberal Party) Share this | | Hansard source

I rise this morning to add my voice in opposition to the Carbon Pollution Reduction Scheme Bill 2009. Unlike the previous member, I do question the government’s motives in relation to this piece of legislation. I think this is a purely political piece of legislation at the moment. This is not an environmental piece of legislation, and I think that is evidenced by the lack of detail that we see within the legislation. When you hear a procession of Labor Party backbenchers speaking on this bill, you have to question their credentials in being able to understand science or the weather. We have heard a wide-ranging report on the weather over the next hundred years. We have heard from amateur scientists and wannabe weather readers. It feels like most of the members of the Labor Party’s backbench have missed their calling in life, because they seem to know what is going to happen over the course of the next 100 years with a whole degree of certainty, whereas every scientific report that I read is very conflicting about what is going to happen over the next 100 years.

Let us have a look at what the New South Wales Department of Environment and Climate Change says. It says that there is going to be a 40-centimetre sea level rise in the next 30 years, yet the Office of Climate Change in Queensland and the Department of Sustainability and Environment in Victoria say there is going to be a 30-centimetre rise. I do not feel as though climate change recognises state borders. I do not think that, once you cross over from our great state of New South Wales to Queensland, there is going to be a drop in the sea level. The fact is that they do not know. They cannot figure it out. And that is the debate that is happening and raging around the planet at the moment. There is a great question about the science. Of course, anybody who raises any point on the science or the lack of certainty about what will happen over the next 100 years is labelled a ‘sceptic’. I can tell you one thing, Mr Deputy Speaker: I am sceptical of the ability of every member of the Labor Party’s backbench to tell me what is going to happen with the weather over the next 100 years. I am sceptical about their ability to understand science. I am sceptical about their ability to find carbon on the periodic table. I am sceptical of a whole range of things. What I am very sceptical about is the government’s strategy of reducing carbon pollution and long-term emissions by 60 per cent of 2000 levels by the year 2050. I feel as though it is a deeply flawed concept.

The member for Oxley raised the matter of GM. I think that finding a market based solution to emissions or greenhouse gases is probably the only way that we will be successful in achieving this in the long term. But, with the scheme in front us at the moment, the only certainty that will come out of this is that we will lose jobs in Australia. The only certainty here is that we will put all of our industries at a serious competitive disadvantage, when you consider that America—the largest economy in the world—will be protecting their industries 100 per cent until 2025. Yet we are here today rushing in a scheme that will put all of our export industries at a massive competitive disadvantage. It defies logic.

It is fascinating to me to consider what the member for Oxley said about General Motors, because if you go to America and you look at what kinds of cars they drive you will see they drive these massive pollution-emitting cars. The cars they drive over there are more like tanks. The market, naturally, has come to the conclusion that people have stopped buying these large heavy pollution-emitting vehicles; therefore, the market is signalling to those companies that they cannot sustain their current level of economic activity. It is what governments have been trying to achieve in the environmental space for decades coming to fruition through the market. People do not want big cars anymore. Yet what does the government do in the United States? It steps in to bail out the big car industries when the fundamental challenge for that industry is that people do not want big cars anymore. They do not want cars that emit so much. That is a good thing. That is a signal that governments have been trying to forecast and create for a long time. It is the kind of thing we need to be able to replicate without a punitive and harsh emissions trading scheme that will threaten so many jobs within this country.

We are limited in what we can say here this morning. The government has guillotined debate, in a sense. We do not have the chance to reflect on all of the measures within this scheme. I simply record that the Carbon Pollution Reduction Scheme here is flawed in its objective. It is being rushed in on a purely political basis without any idea about how we are going to sustain our industries in the long term against some very serious challenges. We ought to wait, we ought to review and we ought to have the necessary detail before we proceed. It is entirely proper that the Leader of the Opposition has sought to amend these bills. It is entirely proper that we are working to get a Productivity Commission report. I oppose this legislation. (Time expired).

Photo of Peter SlipperPeter Slipper (Fisher, Liberal Party) Share this | | Hansard source

Order! Before I call the honourable member for La Trobe, I will point out that the member for Mitchell mentioned that he was from the great state of New South Wales but, given the State of Origin result last night, I am proud to be from the great state of Queensland.

Photo of Alex HawkeAlex Hawke (Mitchell, Liberal Party) Share this | | Hansard source

I have a point of order, Mr Deputy Speaker. I am not familiar with the standing order, but can I move dissent from your ruling? Is that an option to me?

Photo of Ms Anna BurkeMs Anna Burke (Chisholm, Deputy-Speaker) Share this | | Hansard source

There was no ruling. There is no point of order.

10:43 am

Photo of Jason WoodJason Wood (La Trobe, Liberal Party, Shadow Parliamentary Secretary for Justice and Public Security) Share this | | Hansard source

In 2006, I was fortunate enough to visit the Australian Antarctic Territory as a representative of the government. I was mesmerised by the tranquil beauty of Antarctica. Majestic icebergs rose out of the water. Seals lazed about on icy shelves and penguins waddled past, seemingly unfazed by scientists snapping pictures. Antarctica is one of the few places on this earth that has not been spoilt by humans. Sadly, on the other side of the globe, polar bears in the North Pole are in grave danger. Unlike Antarctica, the North Pole has no landmass; it is only ice. Polar bears hunt for food from Arctic ice shelves, hunting seals from ice platforms and fishing through holes in the ice. Global warming has caused these ice sheets to melt significantly. Experts say that within 100 years the polar bear will be extinct. Closer to home, there is a real threat to the Great Barrier Reef unless something is done urgently.

I have been a passionate advocate for the environment since my days in Ferny Creek Scouts and into year 12, where I completed a full-time education course on the outdoors and environment, and then into my first job, where I taught rock climbing, canoeing and cross-country skiing and in which job I later became an instructor. I have actually been a member of Greenpeace longer than I have been a member of the Liberal Party. My passion has not been diminished by my election to this parliament; rather, it has been nurtured and enhanced. In actual fact, at the last election I proposed a $3 million program for weed eradication in the Dandenong Ranges. Sadly, the Labor government walked away from this. I have previously spoken in this House against the logging of old growth forests in Tasmania and also about my utter disgust at the annual Japanese whaling hunt.

I am a strong supporter of an emissions trading scheme. I am of the strong view that, as members of parliament, we must stand up for what we believe in and aim for the highest targets as a benchmark rather than starting from a low base. I have the personal view that, when it comes to an ETS, we should aim for a 25 per cent reduction by 2020 as an absolute minimum.

I know many people do not believe in climate change. I ask those people: what if you are wrong? Do we really want to gamble with our children’s future? Do we want to condemn our most vulnerable creatures to death simply because some people did not think there was a problem? We could be the gatekeepers of one of the most important times in our planet’s history. Without action, we could see the demise of the polar bear and, locally, the death of the Great Barrier Reef.

The Prime Minister during the 2007 election campaign promised to deliver an emissions trading scheme by 2010. Obviously this is a broken promise. He also promised to have strong targets—another broken promise. After the election, the Rudd government rolled out its ETS scheme, which would cut emissions by five to 15 per cent. The scheme was ridiculed by business groups and green groups alike. It was only after a public outcry that the Prime Minister pledged to increase the reduction targets—but only if the whole world agreed to do the same. The government’s emissions trading scheme is a shocker and is no good for the environment. If this government wants to show that it is serious about reducing carbon emissions it should cooperate with other nations at the Copenhagen conference and aim for strong international targets.

I recently met with my former teacher from my outdoor education and environmental course, Peter Cook, now President of the Dandenong Ranges Renewable Energy Association, and with Ms Jo Tenner of the Upper Yarra and Dandenongs Environment Council. The local green groups in my election of La Trobe are very critical of and cynical about this scheme. They see it for what it is—a token gesture that will do nothing for the environment. They want me to vote against this flawed scheme, and I will.

10:47 am

Photo of Julie OwensJulie Owens (Parramatta, Australian Labor Party) Share this | | Hansard source

I have to say that, having listened to the debate most of yesterday and very late into last night, I think I am in groundhog day. It seems that every day we start work on what is profound reform with incredible complexities, we move forward, and then it all stops, and we wake up the next morning hearing the opposition say, ‘I think we should delay it.’ First of all, they wanted to delay it because climate change did not exist. The next day they said we should wait for everyone else. Then they said we should wait for the end of the global financial crisis. Then they said we should wait for the US. Then they said we should wait for the Productivity Commission to review it again. This is extraordinary.

I sat in this House for three years prior to the last election waiting for the government to act on climate change—waiting for the government to mention climate change or even admit that it existed. They were deniers to the end. An election was held and the people voted. We said we were going to do this, and it is time to get out of the way. The opposition’s position is not because they think it should be delayed; it is because they cannot agree on a position. Faced with the conflict within their own ranks, the only option they can come up with is to make the rest of us and the world wait.

Well, we cannot wait, and the Australian people do not want us to wait. The opposition would have us all believe that somehow the Rudd government is rushing off recklessly, going where no man has gone before, as if we are somehow creating a new way of looking at things. So they have moved from groundhog day with that one to Star Trek.

Let us look at the international trends. We are talking about a cap-and-trade scheme, and there is an international trend towards that. Emissions trading is already underway in 27 European countries—we are not the first one in. New Zealand has passed cap-and-trade legislation, and President Obama has called upon congress to bring forth legislation to establish a cap-and-trade system in the US. If we want our economy to be smoothly integrated with the rest of the world and if we want to make a serious contribution in Copenhagen then we must act on this, and cap and trade is the only logical path. Linking allows the import of emissions units from other schemes, which will reduce abatement costs domestically. The nature of our capping arrangement provides additional certainty for business. The legislation ensures that the minister will be required to specify the scheme cap numbers for 2012-13, 2013-14 and 2014-15 before July 2010. Caps beyond that point will be set annually to provide certainty over a five-year horizon at all times.

I want to emphasise the need for immediate action. Passing the bill now will provide business certainty. Our energy and resources sectors engage in investment decisions with a horizon of anywhere from 15 to 30 years. The last thing they need is uncertainty over these long-term investments—investments which are worth billions of dollars and thousands of jobs in this country. We as a nation know that we will be introducing a carbon-trading scheme. The people of Australia voted on that issue in the last election. They rejected the ‘wait and see’ approach of the then government and current opposition. Heather Ridout of the Australian Industry Group said ‘uncertainty is death for business’. The CEO of the Business Council of Australia, Katie Lahey, said:

“To drag on the debate whilst we have got this global financial crisis is just one more complexity that business has got to factor into its planning cycle, and for some businesses it could be the straw that breaks the camel’s back …

In stark contrast to our predecessors, the Rudd government has taken a consultative and flexible approach to public policy. In fact, I cannot recall a bill which involved more consultation. There was an extensive process of consultation with industry and stakeholders through a green paper, a white paper and an exposure draft, and we have continued to listen to business. When global circumstances changed, we reacted and adjusted to ensure we protected the real economy and the national interest. We are determined to reduce the impact of climate change but equally determined to cushion the impact of the global recession on local business and working families. Within the context of the global financial crisis, several sensible and balanced adjustments have been made to the CPRS to ensure that the climate change challenge continues to be met in an economically sustainable way. We have listened to business and we have responded and agreed to a phased introduction of the CPRS.

Climate change has been on the agenda for my constituents for at least a decade. It was ignored by the last government for at least eight of those years, and it is really time that we act. I implore the opposition to just get out of the way. (Time expired)

10:52 am

Photo of Steven CioboSteven Ciobo (Moncrieff, Liberal Party, Shadow Minister for Small Business, Independent Contractors, Tourism and the Arts) Share this | | Hansard source

There is no doubt that climate change is a serious issue—in fact, some refer to it as the ‘generational’ issue. From my perspective, though, it is clear that, with an issue this important, with there being so much debate around the science of whether or not climate change is due to mankind’s influence or is naturally occurring, and as a humble politician, as many of us in this chamber are, with frankly a very limited knowledge of the science, I, along with a number of my colleagues, and no doubt a number of members on the government benches, am of the view that we give the benefit of the doubt to the planet. We take the view that it is important that we do what we can to live in a more sustainable way and we do what we can to reduce greenhouse gas emissions because there is a very real risk that these are a cause or perhaps a significant contributor to climate change and the warming of the planet.

But, having said that, it is also crucial that in these kinds of debates we have a level-headed, rational approach to the way in which we go about setting policy that ultimately dictates the employment prospects, the economic growth and the standard of living not only for our domestic population of 21 million people but also globally. One thing that is very clear is that there is only a global solution to this problem. There is not an Australian solution; there is only a global approach. That is especially the case when in this country we account for 1.5 per cent of global greenhouse gas emissions. That is it: 1.5 per cent. Around 60 per cent is accounted for by the United States of America and China.

When members come into this House and lecture this side of the House, as the Parliamentary Secretary for Defence Procurement at the table does and as government members do, getting themselves all breathless and hot under the collar about how we must act and we must act now, I have to say that I think most Australians view with a high degree of cynicism just exactly what the caper of this government is. Does the government truly expect all Australians to believe that by waiting a further six or 12 months until we can integrate Australia’s approach to an ETS with the approach that is being adopted by the United States, as perhaps the biggest contributor to greenhouse gas emissions and the country that will set the international benchmark, in some way that is going to make a difference to whether or not we save the Great Barrier Reef, save rainforests or make a difference to climate change? Is that truly the argument that is put forward by the Labor Party? It is a complete folly. That kind of fallacious breathlessness that comes from those members on the government benches deserves to be condemned and treated with the disregard that is appropriate for such an idiotic approach to this debate. What we need is rationality, what we need is common sense, what we need is level-headedness and what we need is a global solution. A global solution requires Australia to just pause for six or 12 months and integrate our approach with the approach and the benchmark that will be set by the United States of America. That is the rational thing and the right thing to do. It is completely fallacious to pretend in some way that we have to do this now.

We know the real political agenda of the Australian Labor Party. It wants the Carbon Pollution Reduction Scheme Bill 2009 rejected in this House, it wants this bill to be rejected in the Senate and it wants it to happen twice, because it wants to go to an election. This government is running scared of the debt and deficit it is racking up and it will pull any kind of sophisticated approach and argue anything that it can to have a double dissolution election because it is terrified of its debt. If it has to do it through breathless approaches to climate change, then that is what it will do. I say to government members , ‘Pull your heads in, get real, get part of a global solution and stop pretending that it has to happen now or the Great Barrier Reef cannot be saved.’ The Australian people are a smart mob. They see straight through these kinds of puerile arguments from a government that is, frankly, out of time and, most importantly, up to its eyeballs in debt. (Time expired)

Photo of Peter SlipperPeter Slipper (Fisher, Liberal Party) Share this | | Hansard source

Before I call the honourable member for Bowman, I would remind the honourable member for Dawson that it is disorderly to be reading newspapers in the chamber.

10:57 am

Photo of Andrew LamingAndrew Laming (Bowman, Liberal Party) Share this | | Hansard source

I am effectively in continuance with the member for Moncrieff and I have very similar concerns. In this debate on the Carbon Pollution Reduction Scheme Bill 2009and many of us have sat through it—we have failed to see the government’s argument that we need to act immediately on climate change translated into a valid argument for haste with this legislation. They are very different arguments. We have this debate closing today with just eight people in the public gallery. That reflects on the government having again failed to take the people with them on the complexities around what is the most important legislation brought before this place in nearly a decade.

Let me for a moment compare this legislation with the GST legislation of the 1990s. Members in this place will recall it was this side of the parliament that took the people with them. They were some of the most hostile debates in a generation, but we went step by step through its implications for Australian families. We walked the aisles of the shopping centres and talked about the impact of the GST on people of every socioeconomic background. But what we are seeing today is the opposite.

This is incredibly important legislation that is basically a naked piece of legislative scaffolding, upon which regulations are going to be riveted in the months and years to come. That is the concern of this side of the House. The member for Charlton must accept that the industry that is concerned on our side is also his industry and the workers who are concerned are also his workers. Those who express scepticism and diversity of thought are merely representing the sentiments of the community. Do not cloak this in a belief that it is a battle against deniers, because that was the song sheet of 2007. So often, boxers are only as good as their last fight. The government may well have won in 2007, fighting and seeking out deniers in evangelical zealotry, but the debate has moved on. We have moved on and this side of the chamber has put down serious solutions that are talking about recognising offsets and putting in voluntary carbon trading as of next year—and they have all been rebuked because the government would prefer to have this simplistic 2007 argument all over again. That is the political side of this legislation.

Does this scheme does start in 2010? No. In 2011? Perhaps no. It will be mid-2012. So why the haste in bringing this legislation through now? Wait five months for Copenhagen. But that is not being contemplated by the government. A great tragedy is that any valid debate about the shape of the trading system for Australia has been washed away. Read the legislation and all you will see are very superficial references to OTNs and to caps and to trading and to defining who is affected. But look for the regulations. Only six regulations have been written for this legislation. There are 30 more to come, and no-one knows exactly what the content of those regulations will be. The problem is that the government will not come back here and debate those further additions, because they are sneaking the legislation through under the cover of night, with barely any interest here in the parliamentary galleries. We have schools here today—we have Baranduda and Mary MacKillop—and those schools are watching the most important piece of legislation, but there has not been any sort of meaningful debate from the government seeking out the deniers and exposing them.

If I have to apologise for this side of the House having a diversity of view, I will do it happily because it represents what is happening in the community. Eighty per cent of people want something done, but only a very small proportion of the Australian population really have a sense of what has to be done and how it will be done, and the impacts it will have. That is what this chamber should be debating, but it is not happening. Contrast that attitude with this side’s approach to complex and important legislation like the GST. We seriously engaged the Australia population, but that has not happened on this occasion.

Lastly, when we look to our major neighbours, as previous speakers have said, we have the US evolving legislation that is completely different from ours. The US legislation is effectively providing 100 per cent cover to export industries. Legislation in the US is effectively exempting coal, and it is guaranteeing up to 30 per cent of export entitlements to the power industry. Effectively, a nation with half of the export exposure that Australia has, by percentage of GDP, is looking after its exporters. I say to the member for Charlton: we have not even begun this debate in this House. We are effectively handing you a signed cheque. Yes, we will have the equivalent of a new tax, but you have not even told us what that tax will be. At least we talked about levels for the GST before we brought it to this chamber. I think this is almost, in an intellectual way, dishonest. It is dishonest to confuse the general desire of the community for something to be done with hasty, bungled and rushed legislation. We need a bipartisan approach on something as important as this. This government, by acting with such political haste, has prevented that occurring. I urge the House to support the amendments. (Time expired)

11:02 am

Photo of Robert OakeshottRobert Oakeshott (Lyne, Independent) Share this | | Hansard source

I will be as quick as possible but I just want to make three points on the amendments. It is worth noting that I think I am one of only two members in this amendment debate to talk to the amendments. This is one of the more interesting and potentially one of the more fascinating aspects of the CPRS, if delivered right. It fits in with the support so far that I have given to the legislation although, in its current form, it is far from perfect. In many ways it is imperfect. If this amendment is a sign that the government is recognising that, that it is the start of a process rather than the end of a process, that we are going to see more value adding over time to the legislation generally, then that is a process I certainly welcome.

The issue of reafforestation rights on the back of carbon sequestration rights is, as I say, one of the more interesting and potentially more significant aspects of the legislation. Regardless of your position on global warming or climate change generally, there are some uniquely Australian issues that we need to deal with as a country. Whether they be soil erosion issues, salinity issues, riparian zone issues or biodiversity issues, we are now seeing for the first time, finally and with a little bit of hallelujah about it, public policy recognise that the tree has many roles with regard to delivering on public policy. We traditionally in this country see it as the role of the tree to be cut down and made into beautiful timber products—and, Mr Deputy Speaker, you are sitting in a very fine example of that role of a tree. But in the current climate, and heading into the future, that role will have to diversify. We will have credits and offset roles for the tree. As I say, if it is done right, we can now address watertable and salinity issues, soil erosion issues and biodiversity issues. We can address those things if we are clever about how we deal with the public policy question of the role of the tree.

It is for that reason I say that this legislation is missing some things. It does not answer the question that has been made very public in the last week with regard to managed investment schemes. The collapse of Great Southern is one example, and there is the growing concern by many that monoculture plantations are not an environmental outcome; they are an environmental detriment. If this is going to lead to greater examples of monoculture plantations in some sort of investment process, as we have seen through the collapses of the last week in managed investment schemes, then it is not a win for the economy and it is not a win for the environment.

The second point I want to make concerns the question of biodiversity. That is the missing link in what I am seeing in this legislation and in the CPRS generally. There are people who have the science clear in their heads and who are having a really engaged debate about whether you can have a market based response to questions like reafforestation that include biodiversity as an added outcome as well. I am disappointed that that is not part of what I am seeing—I might have missed it, but I do not see any reference to that really difficult but really important question of how you place a value on biodiversity outcomes. For Australia there can be a really valuable gain if we can write into the public policy agenda for the future those biodiversity outcomes such as offsets for reafforestation, carbon sequestration and a CPRS response to climate change.

The third point I would like to make is with regard to the international agreements. This 1991 line is an artificial line and we need to sort that out at Copenhagen and get international agreement. The trees in the ground prior to 1991 have value and we are doing good work for our region. Australian companies like Macquarie Bank are investing in REDD projects. I can think of one in Cambodia. That is the future for developing nations. There has to be an economic value placed on the tree in the ground. We need to support that if we are serious about this overall issue. (Time expired)

11:07 am

Photo of Tony WindsorTony Windsor (New England, Independent) Share this | | Hansard source

I do not apologise for delaying the House as I think this legislation is a very significant issue. I think the member for Lyne made a very important point a moment ago that there is a not-so-subtle contradiction in policy messages here. I have raised the renewable fuel issue on a number of occasions. Some members of the House, in fact I would say a majority of members of the House, believe that using agricultural land for fuel production is something that we should not be doing. I do not agree with that but, nonetheless, a lot of people do.

There is a collision point between fuel, food and carbon. They are three different policies but they collide at this point. Here we have a policy being introduced to encourage the use of land that could have been used for food production to go to tree production—a monoculture, as the member for Lyne suggested—which will mean that there could be benefits in terms of the emissions issue. Inherent in the message is that there will be land taken out of production that could have produced food. I do not argue with that. I think that it should go to the highest return as long as there is not environmental vandalism happening at the same time, and there are some questions about that in relation to a monoculture.

Why doesn’t the government have the same logic in terms of agricultural land being used for fuel production at source? I raised the point last night. We have an absurd situation in Australia, being poorly placed geographically in terms of some of our trading partners, where we grow 80 per cent too much of, for instance, grain and we export it overseas and we have all the carbon footprints getting it there. The starch within the grain is actually carbon and we export that. We get the dollars and we then go to another country and buy a boatload of oil and bring it back with all the carbon footprints that that denotes. Surely, if we are serious about emissions, we should look at these transport movements when quite a lot of them are to just enter the exchange of money to buy another product to bring it back. Surely there is an intersecting point where we can use some of that land to produce fuel.

The government has just introduced amendments, the very amendments we are voting on now, to use land for carbon offsets, not for food. We are endorsing that today. Surely we should be doing some accounting in terms of what shifting all of this carbon and starch around the world means in terms of the emissions-trading arrangements. I would suggest to the Parliamentary Secretary for Climate Change that this contradiction really needs to be looked at. I am not having a go at anybody here. I think it is a collision point that we need to identify. If we are going to start to drive land use through a policy that says, ‘You will make more money out of growing trees than out of growing food because there are these savings,’ what message do we send to other potential businesses such as the ethanol industry with cellulosic ethanol?

As the policy mix and the budget papers stand at the moment, after next year—or maybe it is the year after—renewable fuel will come back onto the tax regime in a similar fashion to carbon based fuels. Renewable fuel is one of the targets, and fine-particle emissions is another one of the targets that we are trying to get to in terms of health and emissions. I am pleased the Minister for Health and Ageing is here and I pleased to see that she is taking down notes furiously as I speak. I think we have to have a very serious looks at these points because we cannot use one argument to set aside one industry that can achieve environmentally and then use the same argument to drive another as we are with these reafforestation amendments within this particular legislation.

11:12 am

Photo of Bob KatterBob Katter (Kennedy, Independent) Share this | | Hansard source

I wish to agree with my Independent colleagues and with their enthusiasm. Taking up where the honourable member for New England left off, we have a project in the pipeline, the biofuels project, and it will produce over 1,000 million litres of fuel a year. Australia uses 20,000 million litres of fuel. In relation to his point about health, it is just extraordinary to me that 2,000 people are dying in Sydney and Melbourne that do not have to die. Professor Streeton, the eminent Melbourne surgeon who was the leading witness in the tobacco case in Australia, and Professor Carney from Sydney University have commented. There is information in the Journal of the American Medical Association and I can give the reference to the Minister for Health and Ageing if she wishes. Clearly, there are 2,000 people dying in Sydney and Melbourne that simply do not have to die. If Streeton or Carney were here they would get very angry and very emotional because they would see a government that just could not care less.

The Americans care. They did not pass legislation to get ethanol, help farmers or forestall Middle Eastern oil. The legislation was the air quality control act which was passed after the completion of the California study that indicated that when you had a doubling of your pollution you had a doubling of lung cancer and heart disease. I can give you the reference from the Journal of the American Medical Association, and it was also on the front page of New Scientist magazine. It was an earth-shattering event. Quite obviously, the governments of Australia are so ignorant that they do not even know what is going on in the world, but the Americans did. Except for those from the oil-producing states, every single senator voted for the air quality control act. It simply says that, when the ozone non-attainment level reaches 0.42, you have to oxygenate your petrol so you get a better burn and so people are not going to die from the stuff that gets in your lungs from the emissions.

I do not speak for the grains industry, but on, I think, page 176 of Al Gore’s book, he says there is a 29 per cent reduction. If you get the congressional papers and all of the information papers from the United States congress, every one of them centres around a figure of 28 or 29 per cent. Every single study that was done in the United States and in the world indicates a reduction in CO2 of 28 or 29 per cent when you switch to ethanol. Name me the only country in the world that does not have biofuels legislation. We are in it. The only country that I know of in the entire world that does not have biofuels legislation is us. The European Union has passed a number of resolutions which are binding upon its member states. Canada, the United States, Brazil, China and India are doing it through regulation as we talk. So the answer is there, but the government is going to impose a handicap on all of our industries for no good outcome.

There is another issue which it is vital to consider, and the honourable member for Lyne was here buying time so that this thing can be done properly and objectively. I think that there are commercial pressures upon this government, as there were upon the last government, from the oil companies, Woolworths and Coles and these people who control the bowsers in Australia. There is not the slightest doubt in my mind that the only interpretation that can be put on it is that interpretation.

I know that in the sugar industry, where we have a much greater benefit than the 29 per cent in the grains industry, we can produce off just one dam, Hells Gate, 1,000 million litres. About 20,000 million litres can be produced from one single dam and a tiny 100,000 hectares. At one stage, Mr Acting Speaker, I had a cattle station that was twice that size. That is a tiny amount of ground, I can tell you. The Mitchell River and the Gilbert River will give you another 3,000. We have over 40 rivers in the gulf; just two of those gulf rivers will give you 3,000 million megalitres. The sugar industry will then convert over, so there will be 8,000 million megalitres without even touching the grains industry. (Time expired)

Photo of Peter SlipperPeter Slipper (Fisher, Liberal Party) Share this | | Hansard source

Prior to calling the member for Goldstein, I point out to the member for Kennedy that I am not the Acting Speaker; I am merely a deputy speaker.

11:18 am

Photo of Andrew RobbAndrew Robb (Goldstein, Liberal Party, Shadow Minister for Infrastructure and COAG and Shadow Minister Assisting the Leader on Emissions Trading Design) Share this | | Hansard source

In summing up the contribution of colleagues on my side of the chamber, I say that climate change is an issue of great consequence. In that regard, the Carbon Pollution Reduction Scheme Bill 2009, which we are considering in the House today, is perhaps the biggest deliberate structural change yet in our history. But what do we see on the other side? Apart from the government members, no-one supports this bill. This bill is friendless. No-one supports this bill. The Greens do not support this bill; the crossbenches do not support it; the coalition does not support it; and nor, in fact, do those in the community who are informed about the bill. So many green groups have approached me and my colleagues saying, ‘Vote against this bill; it is not in a position to do the job.’ So many industry leaders who are supportive of a price for carbon have said to me, ‘This bill is deeply flawed and will cost jobs.’ Why are they opposing this bill? They are opposing it because it does nothing for the primary task it sets out to achieve—that is, in reducing CO2 emissions in the atmosphere. It does nothing. In fact, it could increase global levels of emissions in the atmosphere, and, as a consequence of carbon leakage, it will also see thousands of jobs go offshore, it will see investment collapse in the resources sector and it will see many industries under great competitive pressure because of the nature of this bill.

You would think that opposition would lead the government to ask, ‘Why?’ You would think those on that side would be starting to query and to reach out to all those groups to find solutions for the deeply flawed nature of this scheme. But not on your nelly! There has not been any suggestion of any contemplation of any changes. It is a ‘take it or leave it’ approach, basically. It ignores what is happening in the rest of the world. It is an arrogant approach. And why? They have forged on because their arrogant approach to this bill is driven by politics. It is dripping with politics. The Prime Minister is sticking to a scheme that is so awful that it cannot be supported by anybody so that he can go to an early election claiming that he tried on climate change. ‘Oh, I tried!’ But he will blame the inaction and incompetence of everyone else. We have seen this pattern of behaviour before. In regard to any difficult issue that the Prime Minister has had to confront, he blames somebody else. He shifts the blame but says that at least he tried. This is a cunning strategy, but it is dripping with cynicism; it is a shameful strategy.

This is an issue of great consequence. The scheme has been rushed and ill considered and it is grossly misleading. People have not been given any sense of what would happen if this bill comes in and our major competitors do not engage in a similar scheme within 10, 15 or 20 years—or more, for that matter. None of that work has been done. People have been misled and kept in the dark for crass political reasons.

The main argument of the government is that it will provide certainty. This is a nonsense argument. This bill will in fact do the opposite. It will lead to great uncertainty. So many leaders have said that to me. I think the feeling was summed up by the CEO of Anglo, who said, ‘I don’t need the certainty of a bullet.’ That captured the sentiment of so many in industry, so many who want to do something constructive but feel deeply threatened by this. It is a bill that has five or six pages out of 450 pages on trade exposed industries. Yet the real substance of the impact of this bill will be in the regulations, which are months away and which will change again once the rest of the world does something. This bill is deeply flawed. We need to wait and see what the United States does and we need to wait and see what happens at Copenhagen. So much is happening internationally. We need calm common sense at a time when the economy is under great pressure. We need to do this thing correctly. We will urge the government again in the other house to defer the vote on this until after the new year, when all of these things have been decided. For that reason, we will not be supporting these technical amendments.

Photo of Peter SlipperPeter Slipper (Fisher, Liberal Party) Share this | | Hansard source

I call the minister at the table, the Parliamentary Secretary for Climate Change.

11:23 am

Photo of Greg CombetGreg Combet (Charlton, Australian Labor Party, Parliamentary Secretary for Climate Change) Share this | | Hansard source

I thank—

Photo of Bob KatterBob Katter (Kennedy, Independent) Share this | | Hansard source

Mr Deputy Speaker, I think I had the call.

Photo of Ms Anna BurkeMs Anna Burke (Chisholm, Deputy-Speaker) Share this | | Hansard source

The honourable member will resume his seat. I have given the call to the honourable the Parliamentary Secretary for Climate Change.

Photo of Greg CombetGreg Combet (Charlton, Australian Labor Party, Parliamentary Secretary for Climate Change) Share this | | Hansard source

I thank the members again for their contribution to the debate on the amendments that have been proposed by the government. In particular, the members for New England and Lyne—supported by the member for Kennedy—raised a number of issues relating to those amendments concerning reforestation and they touched upon matters of soil carbon. In response to those issues: the forest carbon science is far more mature than the science relating to soil carbon sequestration. In fact, the measurement of forest carbon in the CPRS has been designed to be consistent with internationally agreed methodologies. That has been possible because the science underpinning measurement of carbon stored in forests is now very well established. In fact, forest carbon has been credited in Australia, as I am sure the members are well aware, since 2003. For this reason, the inclusion of these amendments in the Carbon Pollution Reduction Scheme Bill and ultimately their operation under the Carbon Pollution Reduction Scheme when it is enacted will help Australia through reforestation projects meet its international commitments.

I will go to those amendments in slightly more detail. Under the amendments, the government has the intent of encouraging carbon pollution reductions before the start of the full-scale scheme on 1 July 2011 for eligible reforestation projects, because they will be able to generate permits for carbon stored from 1 July 2010. This will indeed create economic opportunities in regional Australia. It is the case that the benefits of scheme participation will be the greatest for owners of new forests that will not be harvested. Scheme participation may not be as beneficial, for example, for those with mature plantations because they have little capacity for additional carbon sequestration or, alternatively, for single rotation plantations such as those owned through managed investment schemes. The member for Lyne made some reference to this. That is because the cost of obligations under the scheme could exceed the value of any permits received for carbon sequestration. But, in addition, forests established under the scheme may deliver additional benefits for regional Australia, including wind protection or improvements in water quality.

A number of issues were raised about the potential impact of these measures on land use. That is a matter on which the government will maintain a close monitoring role. The member for Lyne also referred to the extremely pertinent issues of biodiversity and the relationship of these reforestation measures to the promotion of biodiversity. That is a matter of which the government is extremely conscious and on which work is continuing. It is an area that my colleague the Minister for Climate Change and Water, Senator Wong, and I are continuing to work on very closely with the department at the moment. On the issue of sequestration of carbon in soil, there are two prerequisites, given that the science is far less mature than that for sequestration in forests. The two prerequisites for credit from increases in soil carbon to be included in the CPRS are the further development and maturation of the science based upon Australian soils and changes to the international carbon accounting rules. The government is actively working on both of those fronts.

Finally, there has been no case made for delay of consideration of these bills. In my earlier summing up I addressed all of the issues raised by the member for Goldstein a moment ago. It is clear that the attempt by the coalition to cause delay in consideration of the Carbon Pollution Reduction Scheme legislation is because of division on that side of politics. This is the greatest environmental reform that an Australian government has undertaken. It requires leadership. The science of climate change demands action. The government is taking that action, and I commend the amendments and the bill to the House. I move:

That the question be now put.

Question put.

Photo of Peter SlipperPeter Slipper (Fisher, Liberal Party) Share this | | Hansard source

The question now is that the amendments be agreed to.

Question agreed to.

Question put:

That the bill, as amended, be agreed to.

Bill, as amended, agreed to.