House debates

Thursday, 29 October 2009

Carbon Pollution Reduction Scheme Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (Consequential Amendments) Bill 2009 [No. 2]; Australian Climate Change Regulatory Authority Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (Charges — Customs) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (Charges — Excise) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (Charges — General) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (CPRS Fuel Credits) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (CPRS Fuel Credits) (Consequential Amendments) Bill 2009 [No. 2]; Excise Tariff Amendment (Carbon Pollution Reduction Scheme) Bill 2009 [No. 2]; Customs Tariff Amendment (Carbon Pollution Reduction Scheme) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme Amendment (Household Assistance) Bill 2009 [No. 2]

Second Reading

Debate resumed from 28 October, on motion by Mr Combet:

That this bill be now read a second time.

upon which Mr Turnbull moved by way of amendment:

That all words after “That” be omitted with a view to substituting the following words: “the House:

believes that the Government’s proposed emissions trading scheme is flawed and in its current form will cost Australian jobs and investment, and simply export rather than reduce global greenhouse gas emissions;
supports the Coalition in again calling on the Government to defer consideration of this legislation, which will impose the single largest structural change to the Australian economy, until after the Copenhagen Climate Change Summit has concluded in less than 50 days time;
notes that as the Government remains determined to keep an utterly artificial and self-imposed deadline of this Parliamentary year and as such before the world meets to address the important issue of global action, the Coalition has proposed changes to the Government’s ETS to ensure the following critical matters are addressed:
that emissions-intensive trade-exposed industries remain on a level playing field with competitors in other advanced economies;
that agriculture is excluded from the scheme, rather than included after 2015, and farmers have access to agricultural offset credits;
that the impact of higher electricity prices on small businesses be moderated;
that the coal industry is required to reduce fugitive emissions as technically feasible, but not be unfairly financially penalised;
that transitional assistance to coal-fired electricity generators is sufficient to ensure that electricity supply security is maintained and the generators remain viable; and
that complementary measures such as voluntary action and energy efficiency are encouraged”.

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

I remind the House that it has been agreed that a general debate be allowed covering this bill and orders of the day Nos 3 to 12.

10:22 am

Photo of Darren CheesemanDarren Cheeseman (Corangamite, Australian Labor Party) Share this | | Hansard source

It is with some pleasure that I rise to speak on the Carbon Pollution Reduction Scheme Bill 2009 [No. 2], and cognate legislation, which is very important for my seat of Corangamite but also, of course, for Australia. It also is extremely important for the rest of the world. I would first like to express my thanks to the Minister for Climate Change and Water, Senator Penny Wong, for a fantastic job in getting this bill here today. This is extremely complex legislation dealing with extremely challenging issues of both an economic and environmental nature. I do not think there would be too many politicians who would have the capacity to drive the reform in the way that the minister has. It has been an epic and incredibly difficult task and the minister has done an incredibly good job in getting the legislation to this place today.

I want to make some clear and unequivocal statements so that they go on the record for the people in my electorate to judge me on this matter. But I do not want to be judged as many in the Liberal Party have been. It is a party that currently is very divided on this question and one that continues to duck and weave on having a sensible and practical debate on this issue—one of the great challenges to people of our time. I believe people, and industry, have contributed very substantially to the greenhouse effect that Australia and the rest of the world face. I believe that we have moral responsibilities that go to that challenge. I believe Australia is a country that has one of the highest carbon footprints proportionally anywhere in the world. It has a moral responsibility to lead on this matter.

We have a responsibility to help rectify the damage that we have done. We have a responsibility to future generations and, of course, we have a responsibility to respond to the challenges that this places on peoples across the world. We have a responsibility for the impact that we are having on our fellow Australians. I believe that advanced countries of the world, which have done the overwhelming amount of damage, have a responsibility to lead and to set an example for the rest of the world.

My seat, Corangamite, is a perfect example of the difficulties of putting together this legislation and the importance of getting it right. In Corangamite we have hundreds of kilometres of ocean bordering the electorate. We have the Great Ocean Road which is both an engine of the tourism industry and a huge social monument that was built by 3,000 returned servicemen post the First World War. Modelling that I undertook immediately before the 2007 election showed that sea level rise, driven by climate change, will see the Great Ocean Road breached in place after place. In my seat we have incredibly important environmental assets, such as the Otway Ranges, the Lakes District and our very unique volcanic plains that scatter across western Victoria. These assets are now at far greater risk due to fire, and the lakes have been drying out for the last decade, I believe, in part because of climate change.

In Corangamite we also have a very substantial farming community. Everybody should be very well aware of the challenges that a changing and drying climate has placed on our farming communities in Corangamite, in Victoria, and across large swathes of the Australian continent. Less rain is causing enormous challenges to our farming communities. I am also aware that there are some very big challenges as to how we might include farming in a CPRS into the future. As most people know, farming is within the top three emitting industries in Australia. In my view that means that, of course, farming has to be included in an ETS for us to drive the reduction in carbon that we need. It is also important because if we do not include them we have just put that extra pressure, that extra responsibility, onto the jobs of people in other industries.

The Liberal Party and National Party argument that farming should be excluded from the CPRS is just about playing favourites. It is shallow and it is shabby politics. Doing this means choosing to put more responsibility on Shell workers and Alcoa workers in my seat. It will make it harder for Shell and Alcoa workers and harder for those industries. I believe all industries should be included in a CPRS if we are to have a system that has integrity and that will work to stabilise our climate. Every person, every industry, in my belief has a responsibility to contribute.

The key question is how do we include agriculture? Again, I think Minister Wong has got the approach just right. The CPRS includes a well calibrated policy for the farming community. Putting together an expert panel of farmers, economists and scientists who have the time to look at the question and make recommendations makes a hell of a lot of sense to me. Then there is also the time required for implementation.

It is a good policy—a sensible, balanced policy. It is just what the farmers in my communities tell me is required. The minister and the whole of the Rudd government are aware of our responsibilities regarding the jobs of farmers, the jobs of Alcoa workers, the jobs of Shell workers and the jobs of many workers in the tourism industry in my seat and many other seats across this nation.

We have to recognise the need for industry transition. We are providing the industry assistance that is required and the time that is required to implement it. These bills balance the overriding need to act on climate change with the need to put in place mechanisms that will allow our industries to adjust. What we are doing here I believe is historic. We are showing leadership. We are providing some certainty to business. I believe a world carbon market is inevitable and will be created. We are readying our country with some well-calibrated legislation for our time.

These bills have clear aims and targets. The government has an unconditional commitment to reduce our carbon pollution by five per cent by 2020. We are also making a commitment to reduce our carbon pollution by 15 per cent by 2020 if major developing economies commit to substantially restrain emissions and advanced economies take on commitments comparable to Australia’s. There is a quite clear target to reduce our carbon pollution by 25 per cent by 2020 if the world agrees to a global deal to stabilise levels of CO2 equivalent at 450 parts per million or lower.

There are no more important bills in this place than these bills. This is about how we can turn around the terrible legacy of unfettered industrialisation that we have had that has led to such enormous carbon dioxide emissions—a legacy that now threatens to engulf islands in the South Pacific; a legacy that threatens to decimate biodiversity; a legacy that is threatening human life and creating fire, storm and flood events of unprecedented ferocity and scale, as witnessed in Victoria last summer; and a legacy that will leave future generations with a shell of the world that they of course did not create.

On the other side of this chamber we continue to see a coalition that is in a shambles. It is a sad thing to watch, particularly given the importance of these bills. As we know, there are people over there who deny climate change is happening, and I think that is a great shame on this nation. There are people who want to pick industries to be left out of carbon pollution reduction processes. Of course, there are those on the other side who do not understand that the planet’s climate is changing rapidly and understand that we have to act. I say to those people: it is time to stand up. These are defining bills from both economic and environmental perspectives. Future generations will look at these bills and judge all of us. This is where politics does make a difference.

As I have said before, I am very proud of these bills. We are now a world away from the shameful Howard years when climate change continued to be denied. This is Australia saying that we are prepared to stand up and make a difference. This is Australia saying we are committed to stabilising our planet’s climate. This is Australia saying to the rest of the world we are fair dinkum about the role we can play. I commend these bills to the House.

10:34 am

Photo of Mark CoultonMark Coulton (Parkes, National Party, Shadow Parliamentary Secretary for Water Resources and Conservation) Share this | | Hansard source

I will take the few short minutes I have before I am forcibly removed and burnt at the stake for being a denier and a sceptic, one of those horrible people who dare stand in the way of the Rudd Carbon Pollution Reduction Scheme juggernaut. Unlike members opposite, I do not come in here with prepared notes. I do not have a factory full of minions sweating away in the bowels of Parliament House giving me the correct lines to say on this. I come to this debate with years of experience. While those on the other side were crawling over each other stacking branches of the ALP and working off the sweat of others as union officials, I spent some time working with the environment in my previous occupation as a farmer.

I have heard nearly every speech in this debate on these CPRS bills, from the first time round in June and now. I have been prepared to have my mind changed. I am not denying that the climate is changing. I have listened to the debate from the other side and have heard some very compelling arguments about how the climate is affecting the Great Barrier Reef and Saibai Island, which the member for Leichhardt spoke about. Who can deny that? But we had some other quite fanciful arguments. The member for Makin said that we had to agree to this legislation now and we had no time to wait. I assume that he had a summer holiday planned and he wanted Kevin to fix up the climate so he would not have any bad storms. He said that fires, droughts and floods were all at the same time the effects of climate change and if we did not pass this legislation this week then we would have a pretty ordinary summer. That argument defies belief.

I have been sitting here and in my office watching this debate waiting for someone on that side to give me an explanation of how this legislation will affect climate change. We have heard compelling arguments that we do have climate change—and I am not going to deny that—but not one person has explained to me how these bills will affect the climate. What I do know is that this legislation will affect my electorate. If I am going to be seen as part of a rabble, as a denier or a sceptic because I am going to fight for my electorate, then so be it.

I will give an example. My electorate is embracing alternative forms of energy. Indeed, there are major wind farm developments in the Coolah district. Mr Acting Deputy Speaker Schultz, you would know—coming from where you do—that wind farms are huge structures that require a large foundation, which is largely made up of cement. At the moment they get their cement from the Kandos cement plant, a plant that has produced cement for Australia for over 100 years. Indeed, the pylons on the Sydney Harbour Bridge came from Kandos cement. When this legislation comes in, Kandos cement will be 30 per cent dearer than cement from Asia. At the moment, there is about parity in price. It is about the same price for a boatload of cement from Asia as for cement produced in Kandos. Kandos has an edge because it is located in the central west and it is of higher quality. But it will not be able to compete with cement prices that are 30 per cent lower. So the Kandos cement plant will close. Over 100 people who work in that plant, many of their families having done so for six or seven generations, will lose their jobs. The entire reason for the township of Kandos, a town of 1,700 people, will cease to exist.

But we will still need cement, so we will import it from Asia, from countries that do not have a carbon pollution reduction scheme. The cement will be coming in, with probably 30 per cent higher emissions into the atmosphere. It will be put onto a ship, which burns fuel, and landed here. What will have happened? We will have increased our emissions, we will have destroyed a town, we will have destroyed an industry and we will have put our community at a disadvantage.

For this legislation to work, it will rely on people changing their habits. There has been a very dishonest argument in this. It has been perceived as something that the government can do. Our wonderful international statesman the Prime Minister is going to fix the climate with this legislation. What has not been explained is that, for the Carbon Pollution Reduction Scheme to work, people have to change their habits. I had a group of young people in my electorate come to speak to me. One of the great pleasures of being a member of parliament is that you get to speak to people from all age groups. This was a group of very concerned people. I asked them, ‘Should we be doing something about carbon pollution?’ They said, ‘Yes, we should.’ I asked, ‘Should we be going to Copenhagen and signing this?’ They said, ‘We should be showing the world that we care about the environment.’ I said, ‘That’s very honourable.’ Then I asked: ‘Okay, what are you going to do? How are you going to alter your behaviour to do your bit?’ They looked puzzled. I said, ‘For this to work, we have to use less energy.’ I asked: ‘Are you not going to go to the Gold Coast for schoolies this year? Think of the pollution, the greenhouses gases, of that car going up the Newell Highway from Dubbo.’ They said: ‘Oh, no, we hadn’t thought about missing out on schoolies. We’re going to be more sensible, so we’ll fill the car up.’ Okay. Then I asked, ‘When summer hits and it gets to 45 degrees, are you going to flick granny’s air conditioner off in the heat of the day? That will save a lot of electricity.’ They said: ‘Oh, no. We couldn’t do that.’

The people have been conned. This has been very cunning. The large amount of cash that these bills will generate will subsidise the pensioners in the initial stages, will subsidise the cost of fuel and will subsidise the power industry. So we will be subsidising all of these things, but the environment will not have changed. The government will have a $50 billion windfall, but ultimately if we are going to live up to our obligations and reduce our emissions, as we must, we will have to wind back the switches. We will have to use less electricity. As everyone in this place knows, the baby boomer bubble that is coming through will hit aged care. In 14 years time the baby boomers will hit the age where they will need higher care, which will basically mean living inside in a controlled environment. I think now there are five people in the workforce for every one person that is retired. By 2020 or 2030 we will have three people in the workforce for every one person who is retired. Either our elderly, our most disadvantaged, will have their power turned down or the few people left in the workforce will have their obligations cranked up. The sums do not add up.

We need to think about what we are doing here. Professor Garnaut said in his report that regional Australia will have a 20 per cent economic downturn. Mr Acting Deputy Speaker Schultz, you have a rural seat. Can they afford a 20 per cent economic downturn? They are barely breaking even at the moment. Most of them are not breaking even. I wish the member for Corangamite luck for the next time he goes and speaks to his farmers. He said he supports agriculture being in. For those who are interested, the Australian Farm Institute has on its website the FarmGAS Calculator. You go on there and you fill in all the information for your farm. A farmer in my electorate put in a conservative estimate for a few years down the track, with carbon at $25 a tonne. He did not push the limits. He thought he was conservative with the work he did. The added cost of this for one farmer would be $75,000 a year.

It is quite interesting. In this debate we heard from the wonderful, caring, climate-loving people who are worried. It sounds like the member for Isaacs will be up to his neck in water by next Christmas if we do not get this legislation through, because his electorate is down on the coast. It is interesting to note who on the other side we have not heard from. We have not heard from the member for Maribyrnong, the champion of the Australian Workers Union, the man who tells me his union owns the tallest building in my electorate. It was built on the sweat of the backs of shearers, truck drivers, cement workers and coalminers. We have not heard from him. We have not heard from the member for Flynn.

I think this is one of the greatest scandals of all time. We come in here at question time, and they stand behind their leader and they nod and smile on cue, they frown on cue, and while they are there like Pavlov’s dog, nodding and smiling and frowning in unison, they are selling out the people that they represent—the workers of Australia, the people who are going to lose their jobs. How can you save the environment, how can you contribute your share to saving the environment, if you do not have a job? It is absolute madness.

This ‘government knows best’ legislative approach to fixing our environmental problems is absolutely flawed. Australia is the great country it is today not because government has imposed regulation but because of innovation, resourcefulness and hard work. That is why Australia has got to where it is today. How can the Australian people live up to the challenges of altering our practices, altering the way we live, altering our economy, if we have been excessively taxed? How can we do that? How can those companies that need to adapt to a lower carbon economy and use less energy do so if they have had the cream taken off the top? It is just nonsense.

We on this side have heard fanciful comments about embracing clean coal technology. Clean coal technology is a way off, but it requires 30 per cent more coal to generate a kilowatt of power, so when it does come in it is going to be more expensive. Who can afford it?

At this stage there are two things this country relies on that make it great: a cheap source of reliable energy and the ability to produce food—and we are severely going to hamper both with an ETS. If farmers are included, they will not be able to afford to run livestock. The temptation will be to plant their productive land with trees and claim carbon credits. Well, that is very nice, but we cannot eat carbon credits. Australia does not only feed the 20 million people that live here; it feeds another 50 million people around the world. By mid-century, 2050, Australia will have 35 million people and the world will have nine billion. Our obligation to the world is to feed them, and we need to do it in an environmentally sensitive way.

Indeed, I wonder, as I listen to the speeches from those opposite, how many of them have actually invested any of their own money, any of their own sweat, any of their own resourcefulness, in improving the environment in which they live. In my previous role as a farmer I am pleased to say that my family and I were involved in early experimental work with the department of agriculture and Monsanto in zero-till agriculture—growing crops without disturbing the soil. Over a period of time, as the organic material was incorporated into the soil as it broke down, it increased the soil’s water-holding capacity, and the carbon levels on the properties I was involved with grew exponentially. Is there any credit for that? Is there any recognition of that work? And I was one of many. It is now accepted practice right across the country. Is there any recognition of what the agricultural sector has already done to improve our environment? Our irrigators are now growing a kilogram of cotton or food items such as vegetables for a fraction of the water they were, but there is no recognition of that.

I am opposing this legislation. This is going to destroy this country. It is going to destroy my electorate. I just hope against hope that some sense can prevail in this argument before we commit Australia to absolute disaster.

10:49 am

Photo of Peter LindsayPeter Lindsay (Herbert, Liberal Party, Shadow Parliamentary Secretary for Defence) Share this | | Hansard source

In this debate on the Carbon Pollution Reduction Scheme Bill 2009 [No. 2] and related bills, I want to take two minutes of the parliament’s time to report on a visit I made to the United States about 2½ weeks ago. As part of a parliamentary delegation I was privileged to go to Columbia University in New York and meet with the world’s leading climate change scientists. It was a very interesting discussion. When asked quite directly what they thought of the Kyoto protocol, they said it was not worth the paper it was written on because there was no follow-through—lots of talk and no action. As for their advice on the way ahead, they said no one country should get too far ahead of any other country in relation to its approach to climate change and CPRS-ETS issues. I think that is very sensible advice. Australia should listen to that, and the government and the parliament should listen to that, because if we move too far ahead of the rest of the world our country will be damaged and our jobs will be lost, and that is indeed very concerning.

I note that this matter is given lower priority by the United States congress than the priority given to health issues and that they will not resolve their position before Copenhagen. Neither should we. That is a position that the opposition has adopted, and I think that deep down the government really thinks that is the way we should go. I support the sensible amendments that are being proposed and we look forward to seeing the government’s response in due course.

10:51 am

Photo of Rowan RamseyRowan Ramsey (Grey, Liberal Party) Share this | | Hansard source

I rise to address the Carbon Pollution Reduction Scheme Bill 2009 [No. 2] and related bills. What is in a date? What is in a day? What is in a month or even three? The Intergovernmental Panel on Climate Change has identified man’s emissions of CO2—caused almost entirely by the burning of fossil fuels since the Industrial Revolution, over two hundred years ago—as the cause of global warming. Over the last twenty years, world opinion has slowly but surely been swinging to support for action. Accordingly, the Australian government has now committed to an emissions trading scheme—as, indeed, had its predecessor. The Prime Minister has deferred the start-up date for his scheme by 12 months to mid-2011, more than a year and a half away. Almost all of the rest of the developed world, including the world’s largest economy, the US, has not yet decided what their schemes, if any, will look like, and when they will start. In the developing world, the large emitters, China and India, are most likely years away from making any commitment. So what then is in a few months?

We are debating these bills now for no other reason than political advantage for the government. The Prime Minister would dearly like the opposition to vote against these bills so that he can claim that we on this side of the House are climate change sceptics, when in fact our major difficulty with the legislation is locking Australia into a permanent competitive disadvantage with an ETS that is out of step with the rest of the world. It is worth noting that the Canadians, who were quite advanced in the design of their ETS, have shelved its introduction and will now use whatever scheme the US decides on as a template. There is absolutely no doubt in my mind or in that of the majority of Australians that we should not be making these decisions until after the Copenhagen meeting and the passage of any US scheme through their Senate. But the government is determined to force the bills to a vote.

I said on a previous occasion when this bill was last being debated in this place that my commitment to the reduction of CO2 emissions was genuine but that I would not blindly support a scheme that had the effect of sending our industries overseas where they would contribute as much, if not more, carbon into the atmosphere of the planet, providing no benefit at all to the environment. Unfortunately, without serious amendment, that is just what this deeply flawed emissions trading scheme legislation is promising to do. Many would argue that, if the government’s legislation is flawed, we should just let it happen—that they will eventually wear the electoral consequences, lose government and the Liberal Party will be given the job of fixing everything up. Unfortunately, this legislation is just too dangerous to the future of Australia for us to let that happen. That is why the member for Groom is negotiating a number of amendments with the Minister for Climate Change, Senator Wong.

My electorate of Grey is more than a passive observer of the passage of this legislation. The Onesteel plant is essentially the lifeblood of Whyalla, the Nystar smelter is similarly essential to Port Pirie, as is the Northern Power Station to Port Augusta. And then there is the farming industry, which accounts for almost 50 per cent of our economy. They all stand to face significant obstacles to their survival if this legislation is passed in its current form. There is almost no chance that any scheme brought in by another nation will ever include agriculture. The Australian government must rule out agriculture permanently from the scheme, because to leave the spectre of its inclusion after 2015 hanging over its head will affect investment and confidence in the sector. It is also essential that the government offers incentives to farmers to participate in carbon capture and storage.

Landholders control 60 per cent of Australia’s land mass, which has been identified as one of the great potential carbon sinks. For the government not to engage landholders, to exclude them from incentives to change their farming practices—changes that could actually make a real difference—is just plain stupid. If we are to make a serious attempt to capture carbon—and its worth remembering that the only way carbon has ever been sequestered from the atmosphere is through photosynthesis—it is absolutely essential that the people responsible for the land management of 60 per cent of Australia be brought into the business of capturing carbon. Participation will give farmers a chance to offset some of the extra costs they will have to meet as a result of this legislation. If the legislation is unamended, input costs for farmers are likely to rise by as much as 13 per cent—a cost that farmers certainly cannot afford. The inclusion of off-sets will at least give farmers some chance to claw back some of that cost.

For the steel and lead industries in Whyalla and Port Pirie, we are looking at the cutting edge of what could become carbon leakage central. These industries are already being tested to the maximum by the financial difficulties of the world and by a number of policies implemented by the current government, including the new industrial relations environment and the spending-borrowing programs, which are exacerbating interest rate pressure and leading to a higher Australian dollar. The impact of the 92c Aussie dollar on our export and import replacement industries cannot be underestimated. If the government insists on continuing its policy of putting the Australian taxpayer more than $200 billion in debt, despite widespread advice that it should be winding back the stimulus program, then the chance of an even stronger dollar is high.

The ETS as it stands is incredibly complex. On the surface it offers support for industries like Nyrstar and Onesteel, with the issue of credits to the tune of 94.5 per cent of emissions. But, in reality, the businesses are cut up into sections, with some qualifying for different levels of assistance and some not at all. The effective levels of assistance are far lower, closer in fact to 70 per cent. The bill commits to a decay rate of 1.3 per cent a year, which increases the impact on industry year by year, without any reference to what may be occurring in competing countries. In 10 years that actual assistance of 70 per cent will have dropped to 57 per cent. It is a straightjacket which has the potential to strangle these vital industries that are the backbone of our regional economies. There is a grave danger that this approach will see Australia committing to cuts in emissions and to higher and higher costs on industry and the accompanying loss of jobs, when the rest of the world has not moved.

We must have the flexibility to deal with a changing environment. That is why the opposition is proposing that there should be a single level of assistance across all emissions-intensive trade-exposed industries of 94.5 per cent at start-up year until 2015, when it drops to 90 per cent. There will be no further reduction in assistance until 80 per cent of our trade competitors have implemented carbon reduction programs. We also propose that the threshold for assistance should be lower, at 850 tonnes of CO2 per $1 million worth of production. This proviso will allow us to ramp up our commitment to carbon reduction if our trading partners and competitors in the world show a genuine commitment to reducing carbon emissions, rather than just talking about them. In short, if the rest of the world gets serious about this issue, this will ensure that we remain in the forefront of the effort to reduce emissions, but it will not allow us to get so far in front of the pack that we drive jobs out of Australia. Without modifications of this nature, I have great fears for the future of the industries that underwrite the prosperity of both Whyalla and Port Pirie.

The government’s ETS will heavily tax coal-fired power stations, which, like other energy intensive industries, will be forced to have permits for all emissions. This approach will lead to the government collecting enormous amounts of carbon tax, which they will then be able to redistribute to whomever they wish as electoral largess—the honey pot of all honey pots. And do not think governments will not use this for political advantage. This is a heavy-taxing regime and it is little wonder that the industries that stand to benefit most from the trading of permits support their introduction. This will result in a completely new commodity for markets in which to trade and make margins. It is difficult not to have concerns about this outcome.

The opposition is asking the government to recognise how integral electricity is to all production and that large increases in electricity will lead to higher household and business costs. These will flow through the whole economy and eventually rest with those who provide the export income for Australia, because, in the end, they are the only group who cannot pass on their cost increases. So we propose that electricity generation should be rated on an intensity basis. This will allow for generators to be rated against world’s best practice, to buy credits for poorer outcomes and to receive credits for better. This will deliver the same cuts, with the same incentive per tonne of emissions, but with a much smaller total bill. It will reduce the enormous pool of money the government will harvest from the scheme, which they have proposed to give back to certain groups.

The significant reduction of tax will lead to a far smaller rise in the price of electricity. If the price rises by far less, then less compensation will be needed. In effect it reduces the wash of money going around and around in ever diminishing circles, being top sliced, bottom sliced and middle sliced at every transaction level. Our proposal on electricity is about efficiency—we can achieve the same cuts for far less.

This bill, which will introduce a cap and trade scheme, provides no incentive at all for individuals to reduce their carbon footprint. The nation sets a target and, theoretically at least, we will meet that target, even though we may emit more if we buy credits from other parts of the world. There are a plenty of reasons to be concerned by the bill and by the government’s politically motivated time frame.

However, if we assume we meet our target, if a householder changes their hot-water system, refrigerator and light bulbs, double glazes their house or installs solar panels, reducing their energy consumption, all that will do is to allow another industry to emit more without penalty. This is clearly silly.

Part of the amendments the member for Groom is negotiating allows for the introduction of ‘white certificate’ energy credits, which will reward those who make the effort and lead to a real reduction—real rewards for the environment for individual effort. We must not forget that an ETS for Australia is in fact a tax on everything. It will lead to rises in the cost of living and the cost of doing business. If we do not have a global solution, we will not provide any reduction in global emissions. If we are to have an ETS, we should take great care to ensure it is of the cheapest possible nature and still deliver the goods. It cannot do that if we act in a unilateral way.

I urge the government to take away the gun pointing at the head of the parliament, drop its politically based timetable and allow us to get this scheme in step with our major competitors. But I fear they are past common sense on the issue and are driven only by political advantage. If they are to insist on this manufactured timetable then I urge them to negotiate in good faith with the opposition, to recognise some of the flaws in their legislation and act in the best interests of Australia by accepting amendments which will lead to a vastly improved bill.

11:03 am

Photo of Patrick SeckerPatrick Secker (Barker, Liberal Party) Share this | | Hansard source

I am pleased to rise this morning to speak on the Carbon Pollution Reduction Scheme Bill 2009 [No. 2] and cognate bills, which have certainly captured the imagination of newspapers and people all around Australia. The problem with what is being proposed here is that the Labor government scheme is flawed and will have a devastating impact on Australian jobs and trade-exposed industries. The badly designed CPRS will force jobs overseas, will severely damage Australian business and will not make any positive difference to the environment.

The Labor government has again dismissed the needs of regional Australia. The CPRS will destroy regional Australia, it will destroy Australian industry and it will destroy jobs. This CPRS will send farmers bankrupt, if they are forced to buy carbon permits, and it will shift the market share to other countries. No other country in the world is yet to put agriculture into the system and I do not trust this government not to make that decision in 2013 or even before. Agriculture cannot pass on the cost of buying carbon permits, unlike other large companies and retailers. Therefore, they will be left with the financial burden. Given that there is very little scientific research on emissions produced by agriculture, it is unfair to include them in the scheme. The government is rushing this legislation through before Copenhagen and, frankly, it does not need to. The United States will not have anything before Copenhagen, and they are the largest emitters of CO2 in the world, so why does Australia?

This legislation has been poorly thought through and, as usual, it is up to the coalition to put in the hard yards so that Australia does not suffer. The Labor government has left the Australian public in the dark about CPRS, with 90 per cent of Australians admitting that they have very little understanding of this scheme. There are 40 billion tonnes of CO2 emitted globally on an annual basis. Australia emits about 560 million tonnes, which represents 1.4 per cent of total global emissions. Whether you are a believer in anthropogenic climate change—that is, that CO2 causes global warming or climate change—one has to ask whether this system will have any effect on the emissions of CO2 on a global basis. Europe has had an ETS system since 2005. I will give you some examples of what has happened in Europe.

In Cyprus in 2005 the level of emissions was 5.078 million tonnes. That has risen to 5.396 million tonnes in 2007, an increase in the two years of an ETS. In the Czech Republic, it has gone from 82.454 million tonnes in 2005 to 87.834 million tonnes in 2007—yet another increase. In Germany with an ETS it has gone from 474.990 million tonnes in 2005 to 487.004 million tonnes in 2007. In Denmark it was 26.475 million tonnes in 2005 and that has risen to 29.407 million tonnes in 2007. Estonia has gone from 12.621 million tonnes in 2005 to 15.329 million tonnes in 2007—another increase. In Spain, the country that has probably done more than most to bring in the so-called green revolution, it has risen from 183.626 million tonnes in 2005 to 186.495 million tonnes in 2007. Finland has gone from 33.099 million tonnes in 2005 to 42.541 million tonnes in 2007—quite a substantial increase, in the order of 30 per cent. Poland has gone from 203.149 million tonnes in 2005 to 209.601 million tonnes. And in the United Kingdom, where we hear all about their Prime Minister, Gordon Brown, saying that we have to do something about CO2 emissions—he is a great believer in it—they have had an increase from 242.513 million tonnes in 2005 to 256.581 million tonnes. Those are all countries that have an ETS in place, and yet their CO2 emissions are rising.

The coalition has proposed amendments to the CPRS which are designed to save jobs, lessen the impact on industry and consumers and achieve some carbon dioxide reduction targets. Our amendments will protect key export industries and save thousands of jobs in trade-exposed industries. These proposals will cut the price increases for small businesses and households by at least half. Benefits to agriculture under the coalition’s amendments will be the permanent exclusion of agricultural emissions and an agreement with the government to introduce an agricultural offset scheme so that farmers do not get all the penalties of the scheme, even if they are not in it, but they have the ability to offset the costs. Food prices are predicted to rise, although in my experience as a farmer—which I have been all my life before coming to this job—the prices paid to the farmers will be less as the extra costs for food retailers and wholesalers will mean they will pay less to farmers rather than absorbing those extra costs from the ETS tax.

It is interesting to note, as previous speakers on our side have noted, that farming is probably the only industry in Australia that has already reduced its emissions. Farmers have done that through zero- or minimum-till sowing of crops. They did not do that to reduce CO2; it was actually about reducing costs, using less moisture and having better control of weeds. Those are things farmers have achieved by using that sort of new technology.

Frankly, the ETS is nothing more than a system that gives or sells permits to continue emitting CO2—or, as many people term it, pollution. That is not a term I agree with, but it is certainly one that is used quite widely. Ordinary citizens apparently will not have to pay extra for their fuel at first because the extra cost from the ETS will be compensated. One has to ask: how does no change in the price of fuel change people’s habits? I have always been amused by the title of this scheme: the Carbon Pollution Reduction Scheme. Are we are talking about carbon or are we talking about carbon dioxide? The relationship between carbon and carbon dioxide is no closer than the relationship between hydrogen and hydrogen dioxide or water. They are completely different elements. But this government thought it would use the name CPRS as a marketing tool, rather than ETS, emissions trading scheme. It called it the CPRS in the hope that people might think somehow we are improving the health of our environment, as a CPR does in medicine. Frankly, I think it should be renamed the carbon reduction and pollution scheme: initials C-R-A-P.

One of the problems with an ETS system is that we will have industries simply moving overseas to countries that do not have an ETS or a CPRS, as they have done in Europe. Cement factories, for example, have relocated just outside of the EU so that they do not have to comply with an ETS. That could quite easily happen in Australia, and what would be the point of that? We would be exporting our jobs in the cement industry and we would in fact increase our CO2 emissions as we would then have to import cement—you cannot get it from overseas to Australia without increasing your CO2 emissions. We hear that the jobs lost and exported overseas will be replaced by green jobs. That is the great mantra of the Labor Party. Anyone who believes that must also believe in Father Christmas. In Spain, for example—a country that, as I mentioned earlier, has gone a long way down the track of renewable energy—for every so-called green job created, 2.2 jobs were lost, so there was a net loss. There will also be severe effects on farmers even if they are not included in the system. University submissions have shown that costs for farmers are estimated to increase by 14 to 27 per cent even if they are not part of the system because of the extra costs for transport, manufacturing and so on.

I hear people use the line that the oceans will rise by six metres. That is interesting because we spoke with a group of scientists in this parliament on Monday and they were very pro the need to take action, but even they do not agree with that prediction. The IPCC report talks about 30 centimetres over the next 100 years, one foot in the old measures. That is what the IPCC is suggesting, but some people have been quite happy to use this six metres line, as indeed the Minister for the Environment, Peter Garrett, did earlier this week during question time. It would not happen in this millennium. It would not happen in the next millennium. We are 2,000 years off six metres, even if the present rate continues.

I have heard Tim Flannery say that the oceans will rise by 100 metres. According to the present theory expounded by the IPCC, that would take 34,000 years. So it is no wonder that I might be somewhat sceptical about what Tim Flannery writes and says. I hear people saying that global warming might cause deaths from heatwaves. I can assure you that in fact more people will die from global cooling because coldness causes more deaths than heat ever does and ever will. So whenever you hear that argument that global warming might cause extra deaths, you must sit back think that, if we go the opposite way, we will actually have more deaths than we would from warming.

Like the member for Herbert, I was present on that trip to the US and I thank the parliament for bestowing that honour on me. The US will not have a bill passed in the Senate before Copenhagen. In fact, it may never have a bill passed for an ETS. Even the promoters of the bill in the US—and we spoke to them—think that their best chance is a two-vote victory. So there is no guarantee that there will be anything coming from the US on this.

I think there is considerable scientific evidence to show that aerosols of particulates, such as soot and ash, do affect the climate locally. In fact, when Indonesia could not sell its rainforest timber because they were told that nobody would buy it, they actually burnt it and replanted palm oil trees because they could make some money out of palm oil. The problem with that was that it actually affected our climate in Australia. I think there are quite a few scientific studies—in fact I tabled one in parliament in February last year—that show the effect of those aerosols created by the burning of forests in Indonesia. I do not think any scientist rejects the idea that aerosols can have quite a considerable effect on our climate. In fact, we have had volcanoes explode and that sort of negative effect has come about as a result of those volcanic eruptions.

We do have lots of variability about the science. I have no doubt that there will be believers and non-believers in anthropogenic climate change. But, as I said earlier, the question you have to ask is: does an ETS actually reduce global emissions? It has not in Europe, and I gave those figures earlier. In California they have actually levelled off their emissions without an ETS. So there are other ways that you can actually achieve it. I make no apology for the fact that I oppose an ETS. It would be disastrous for my electorate. It would be disastrous for Australia. This ETS, or CPRS as the Labor government have renamed it, simply will not do the job that they say it will. I will leave it at that. There has been a lot of debate on this subject but I can certainly say to this House that I have no intention of voting for this CPRS.

11:19 am

Photo of Bruce BillsonBruce Billson (Dunkley, Liberal Party, Shadow Minister for Sustainable Development and Cities) Share this | | Hansard source

I rise today to again talk about the euphemism that is the Carbon Pollution Reduction Scheme, which really looks like an enormous grab for cash that can then be given away by a big government that wants to be big in everybody’s lives and which really does not tackle some of the compelling issues about climate change and our need to adapt and abate those pressures on our landscape and on our way of life. We are back here in what some would say is a Groundhog Day moment. Like others, I have spoken previously on the Carbon Pollution Reduction Scheme Bill 2009 [No. 2] and have outlined its deficiencies, but there seems to be little movement from the Rudd Labor government to pick up what have been widely recognised as very genuine and legitimate concerns that the coalition parties have raised, and more particularly the very constructive and positive amendments that have been brought forward.

There has been some debate about whether that will salvage one of the ugliest ETSs anyone has seen, a friendless and flawed emissions trading system with that euphemistic name—Carbon Pollution Reduction Scheme. There are some who are doubting whether it can be salvaged. I am one among many in the opposition who are keen to do what we can to try and avoid the worst damage this flawed and friendless scheme will cause on Australia, on our economy and on our way of life while doing very little to address the atmospheric concerns that are leading to climate change and that are having an impact on our way of life, on our wellness and on the health of the globe. To put it simply, many have debated the complexity of climate change and the issues that influence it. Many have pointed to the range of factors and the consensus in scientific opinion that we humans have had an impact, but there is doubt and confusion and lack of continuity in scientific assessments about what precisely one extra tonne of CO2 will do. We have had an impact as humans but there is a lack of precision and specificity about what particular consequences will flow, and often that is a cause of concern.

That complexity reminds me that if we have a world that is ill and unwell and has some troubling symptoms, we need to be very careful in the way we go about addressing those concerns. Think about our own health and the complexity of the human body and the systems that are in it. Those of us who have an ailment hope that the treating physicians will actually target the cause and approach our recovery in a measured and considered way, not simply take action that looks like it will cure our illness but will actually take us out. The solution might be more damaging than the problem we are trying to solve.

Here, though, we are faced with a proposition that has not changed. We are not back here because the Rudd Labor government has proven that its arguments are stronger than ours and that it knows better than just about everyone else in the broader community. The government has not even attempted to make that case. We have not heard a Labor speaker on this bill actually address the amendments the opposition has put forward. We have not had anybody make the case that they are bad proposals. We have not had a single speaker from the Labor Party get up and address the deficiencies in the scheme that have been widely reported in the media. We have not had anybody suggest that the remedies being proposed by the opposition are less effective or more poorly conceived than the ones the government is trying to force upon the nation by bulldozing this legislation through the parliament.

We have had none of that. All we have had is a re-run of some false argument that the government wants to do something about climate change and the opposition does not. This is not a question of will or wanting to do something. The parliament is generally as one in that view. The question is: what is the wise and considered thing to do? But we have heard so little about that from the Labor speakers in this parliament; so little from the Rudd Labor government and its ministers about the wisdom of the actions it is forcing on the nation compared with alternative actions that are being advocated by some, including the opposition, in these carefully considered and thoughtful amendments.

So why are we back here? We are back here because this is part of the Rudd Labor government’s political strategy. The government has not made a case for the bill. It has not made a case that challenges and discredits the alternative ideas being advanced by the opposition. All it has done is re-run the arguments that we heard the last time we debated this bill without anyone turning their minds to whether the provisions in this bill are wise and thoughtful and will deliver the best outcome for our nation, our economy, our natural systems and, in the longer term, the health of the globe.

That has been revealed by Labor speaker after Labor speaker, replaying the false and hackneyed claims of the Rudd government and its political Labor acolytes trying to assert that the opposition is not interested in taking action on climate change and not supportive of an emissions trading scheme. Both are wrong—demonstrably wrong. They are wrong in the sense that it was the coalition parties that first introduced the concept of an emissions trading scheme and wrong in the sense that the Liberal and National parties have a very positive record of action on greenhouse gases and climate change.

This record includes: the Greenhouse Gas Abatement Scheme, investing directly in cost-effective abatement; the Australian Greenhouse Office, the world’s first dedicated greenhouse agency; the mandatory renewable energy target that has been emulated internationally and is now emulated and embraced by the Labor Party; the Solar Cities program, with direct action to address fuel and energy efficiency; the Greenhouse Challenge Program, whereby a collaboration of industry, government and science reduced emissions in the creation of wealth in this country; world leadership on international insights on the impact of land use, land use change and sequestration in our flora; and the decoupling of what was once a direct link between economic growth and energy consumption—it was under the Howard government that we actually decoupled those things and grew the economy at a faster rate than increases in energy consumption. We were one of the few developed countries in the world that were on track to meet our Kyoto target.

All those things have happened under the Liberal and National parties. All those things show the lie in the argument being asserted through the hackneyed claims by those opposite, by the Labor Party and its acolytes, that somehow the Liberal and National parties are not interested in taking action. Well, the record is there and the record is positive and compelling.

It was actually the coalition that instigated work on the emissions trading scheme. In fact, I have in my hand a report that I helped author back in 1998 which talks about regulatory arrangements for trading in greenhouse gas emissions—1998! The committee was chaired by and the inquiry was instigated by the Liberal and National parties. That interim report to the House identified a number of issues and concerns, many of which we are still debating today. These issues were identified a decade ago as fundamental elements that would need to be addressed in an effective emissions trading scheme. Those fundamental concerns remain unattended to and the Labor government refuses to turn its mind to what remedies might look like—remedies encapsulated in the opposition’s amendments.

From that body of work the Australian Greenhouse Office got on with the job of looking at the feasibility of introducing a national greenhouse gas emissions scheme. There was consultation, and an effective and efficient scheme was developed. It was captured following extensive consultation in what has become known as the Shergold model. The coalition’s commitment to an ETS is demonstrable.

When the Liberal and National parties were in government, the then opposition leader, now Prime Minister, was in his ‘me too’ mode—remember that, when there was not a cigarette paper between Prime Minister Howard and then opposition leader Kevin Rudd? In ‘me too’ mode he simply fell into line and picked up the coalition’s commitment to an ETS. He has a character trait of wanting to be the biggest and the best. I am not sure why his name is not Kevin Ruddest—he likes putting ‘est’ on the end of everything he has to say to show how persuasive and important he is. He said, ‘Me too. I will follow the coalition’s lead and embrace an ETS.’ He thought, ‘What can I do to be -est about the ETS?’ And he thought, ‘Let’s be quickest.’ He said he would bring it in earlier than the coalition parties would.

The timing of the coalition parties’ development and introduction of the ETS reflected international trends. Nobody in this place could credibly say that what is happening internationally does not matter. Why would there be such an effort to have the Prime Minister feeling well positioned to go to Copenhagen if it did not matter? Why would he be making such a big deal and ramming this bill through without addressing any of the legitimate concerns and constructive and positive propositions that the opposition has put forward? Why would he be doing that?

The Prime Minister effectively has the strategy of using a statute to increase his stature. That is all this is about. Our Prime Minister is driving this parliament so that he has a statute to enhance his stature at Copenhagen. If Copenhagen did not matter and was so immaterial, you could understand the rush to act. But if it does matter, should this not be an important input? The coalition thinks it should be, and that is why in our timing for an ETS we had accommodated that forward scheduling, recognising that international developments would have an impact and should be taken into account as key input for our domestic emissions trading scheme. But Kevin Rudd wanting to be ‘est’—quickest, in this case—brought the timetable forward as his point of difference. It is hasty and knee-jerk political positioning by a Labor leader who did not think through the implications and had little understanding of what the impact would be of his actions.

Back in July, the Leader of the Opposition outlined concerns such as design deficiencies and issues around voluntary action. Many of them were fundamental and many were highlighted 10 years ago, in 1998, in a bipartisan report to this parliament. It talked about harmonisation issues with major economies, looking at what is happening internationally and having complementarity so that our systems work in partnership with other actions going on within Australia and overseas. It talked about how a scheme would operate with other trading systems and how the global framework would impact on the design. It mentioned other market mechanisms that could feed into an emissions trading scheme, like the clean development mechanism, a system available under the Kyoto protocol. It also mentioned the joint implementation project pathway, where you could do things in developing countries that were funded and driven by developed countries with emissions target obligations and then carry those gains, those credits, back into the accounting for the emissions of the developed economy.

See how they need to interact? This is why Copenhagen and international developments matter. This is why we had the timetable that we did. There are concerns around carbon leakage and emissions-intensive trade-exposed industries. We are interested in the way permits are allocated and the impact on coal fired electricity generation. We are interested in sequestration opportunities—how to encourage and facilitate those so that they can play their part in a sincere effort to reduce our emissions, not a political show to make it look like we are doing something, capped off by a debate by about a statute designed solely to enhance Prime Minister Rudd’s stature. I have not heard too many people saying our Prime Minister needs to feel more positive about himself. I cannot really see why that should be the driving force behind passing a bill through the parliament with no other objective, no other rationale for the time frame being so truncated.

The coalition’s identification of the design principles that need to be addressed and our identification of constructive ideas to improve what has been brought before the parliament have earned widespread support. They were identified back in July. The coalition took up the challenge and provided this positive contribution. It has been well received, but there has been no interest and no engagement from the Labor Party. We hope the negotiations are going well, but why so late? Why the political brinkmanship by the Labor Party when these concerns have been out there for months? It is just more politicking and posturing by the Prime Minister and the Rudd Labor government, who have some steadfast attachment to this flawed and friendless scheme.

When it was first produced, the bill was rejected by all parties in the Senate other than Labor: the Liberal Party, the National Party, the Greens and the Independents. But would the Labor Party listen at that point? No. There were just more lectures. They leered at anybody who had the gall to question what was in there or to point to deficiencies or to suggest improvements to the flawed and friendless scheme. So we are back here again with no change or improvement to the Labor Party’s flawed and friendless emissions trading scheme. We have just bald assertion after bald assertion from those opposite. They are repeating mantras while showing no understanding of, or willingness to engage on, the constructive proposals the Liberal and National parties have brought forward. They just keep repeating the chant, the mantra, that if climate change matters to you the CPRS will do. It is a ridiculous chant from the Labor Party, a moronic statement that really does no service to them and diminishes the parliament.

The opposition’s proposals are thoughtful and constructive and should be embraced. They have been positively received by the broader Australian community. They have at their heart trying to make sure that we do not shut down trade exposed industries for no gain for the environment. What is the upside in that? If we punish and penalise Australian producers and cause them to shut down or to decrease their activity just so that that activity goes somewhere else where climate compliance and time constraints are not a concern, what is the point of that? How is that in our national interest?

Our idea is to cushion the impact of power price increases on small business and consumers. In fact, we believe we will be able to cut them by at least half because of the way we design the scheme. Rather than fit up every electricity generator with the cost of permits for all of their emissions and punish those who are relatively low emitters by forcing them to go and buy Kevin Rudd’s emissions permits, we have said that we can benchmark a level of emissions and reward those that are producing energy for less than that. They will get credits. They will get a bonus for being below the benchmark. Those who are emitting at a greater level, above that benchmark, will have to buy permits from the Prime Minister and the Rudd Labor government. Therefore, the price penalty is only that bit above the benchmark and those below actually get rewarded. You still get the price differential that is at the heart of trying to make behavioural change but you are not ramping up everybody’s costs; you are actually rewarding the lower emitters. Therefore, the cost impact for consumers, for small businesses, families and individuals in my electorate and right across Australia is reduced while maintaining the very price signal that is designed to bring about behavioural change. Doesn’t that make sense? It does unless you have your eye focused on the lolly. It makes sense unless you are the Rudd Labor government, which says, ‘If not everybody is buying our permits we’re not going to get money for all of those permits.’ If we make everybody buy permits then that is more money coming into the Commonwealth so that the Rudd Labor government can be big in everybody’s lives and give some of it back where they think that compensation is justified. That is why they do not like our idea.

But what happens when, as has been discussed in this place, even at the lower permit price level that is being introduced here—which does ramp up—people can buy permits overseas for less than one-tenth of the cost? What if they just go overseas and buy them? What happens then to the Rudd Labor model? They will not be getting all that cash coming in that they are gleefully rubbing their hands waiting to receive. Therefore, their capacity to compensate the people they have needlessly punished is diminished. In that case, what goes? I predict the compensation goes.

To negate that risk you should be very careful in the way you put a price penalty on electricity if you are not able to compensate for it in the longer term. This is at the heart of what the Rudd government is concerned about. If we allow people other than the government to hand out payments—to create permit capability through sequestration action by letting the earth’s systems that have been damaged by humans be improved and enhanced by human action and therefore sequester, or soak up, carbon and create credits that way, like in the farming community—then people would have somewhere else to buy their permits and their credits. This would negate the need to buy permits from this big government that wants to be big in everybody’s lives. Can you see why it does not want to pick up the opposition’s proposals and amendments? Because it puts someone else out there that people can turn to, to help emitters meet their responsibilities. That means less cash for Canberra. The reward for that would go to those who are taking action. That leads me into another area: the built environment, something I am quite passionate about.

Industry body after industry body, scientist after scientist, over and over has pointed out that the built environment is an opportunity for enormous emissions reductions—23 per cent of Australia’s emissions come from our built environment. Why has the built environment been frozen out of this model? The opposition is saying let’s introduce a white certificate scheme, a scheme that rewards improved energy efficiency. It operates in two states now. Why not have a voluntary market and encourage the commercial building sector which, in submission after submission, has said to the Rudd Labor government that it should be in this voluntary scheme. The commendation, positive response and support that have come to the opposition for its proposals in the built environment are echoed every time an industry leader makes a comment about scope and opportunity for the built environment.

Our green depreciation measure has been welcomed and embraced. It is something that has been recommended over and over again to the Rudd Labor government but those recommendations have fallen on deaf ears. The opportunity for efficiencies in the built environment to generate credits that can be on-sold to emitters through a voluntary market is something that has been raised over and over again. But the Rudd Labor government is just not interested. It is interested only in the politics—to get this statute through so as to enhance Prime Minister Rudd’s stature when he turns up in Copenhagen. That is all this about. We have had no coherent, credible argument or challenge or contest to the propositions that have been brought forward by the opposition. I am pleased there is talk of good faith negotiations going on. Maybe there should be some good faith action by the Rudd Labor government as well. (Time expired)

11:40 am

Photo of Michael JohnsonMichael Johnson (Ryan, Liberal Party) Share this | | Hansard source

I am always pleased and honoured to speak in the House of Representatives of this great country, this great democracy of ours, as the member for Ryan representing the western suburbs of Brisbane. I pay tribute to the people of my electorate for their concern on this issue, for their interest on this issue and indeed for their desire that their government and their opposition, their elected members of the national parliament, get it right.

Australia is a great country. For the century since Federation we have had prime ministers from both sides of the parliament, from both political parties, and elected representatives from all parts of our country come to this chamber to do their best to formulate policy and to come up with ideas that take our country forward. They have tried to find policies and programs that empower our people, enrich our nation, give opportunities to our young people and deliver platforms for businesses to improve their bottom line, because we all know that at the end of the day it is small- and medium-sized businesses that employ people; it is not government.

In that context and against that background, I am pleased to speak on these Carbon Pollution Reduction Scheme bills because in my view the federal Labor government is doing a disservice to itself and our country in relation to the way it has gone about this issue. I am sure that I speak for the people of the western suburbs of Brisbane, the Ryan electorate, that I represent, and indeed the constituents I will represent in the new year—those Australians living in the suburbs of Ashgrove, Bardon, Ferny Grove, Keperra, Enoggera, Upper Kedron and Mitchelton—when I say that they want their government to produce a policy that is in the interests of this country’s economic prosperity and its environmental security. I am not sure that this government is doing that. The emissions trading scheme which the federal Labor government wishes to pass ahead of the international meeting in Copenhagen is one that has enormous implications. It is one that has enormous ramifications for every family in this country, for every Australian and for every young person who lives in our country. I notice that in the public gallery there are some young people from some part of our country. They are certainly not from my constituency but I am sure that they come from some school in some state of this great nation. The emissions trading scheme will have an incredible impact on them as they become members of the working constituency of Australia.

This emissions trading scheme has enormous impact on the Australian economy because it imposes enormous structural change on the architecture of the Australian economy. The emissions trading scheme is a fundamental redrawing of the economic architecture of the country and therefore it will have enormous consequences for Australians in employment and for Australian families. At its heart it seeks to impose a tax on industries that by their very nature are emissions-producing industries. At its heart, the emissions trading scheme seeks to put a financial penalty on industries that collectively employ tens of thousands, indeed hundreds of thousands, of people. Simply by their nature those industries produce energy and they produce emissions.

This emissions trading scheme is effectively a tax. It is essentially a financial penalty that will have a massive impact upon the profitability, the commercial viability, of those key and, indeed, strategic industries in our country. I will mention some of them: coal had a value as an exporter in 2008 of some $46.4 billion; iron ore value as an exporter was $30.2 billion; gold was $14.7 billion; crude petroleum was $10.4 billion; natural gas was $9 billion; aluminium ores were $6.5 billion; beef was $5 billion; copper ores and concentrates were $4.2 billion; and passenger transportation was $4 billion. These are just some of the industries that have enormous significance in our country. They generate billions of dollars of revenue for the national government, they collectively employ hundreds of thousands of people and in many parts of Australia they make the economy tick in those respective areas and across the national economy.

I want to put on the record that this bill is one that I have great reservations about, and that also reflects the largely held sentiment, I believe, in the Ryan electorate. I want to take this opportunity to reflect the view of a handful of constituents that have written to me. I have received hundreds and hundreds of emails and lots and lots of letters about the federal Labor government’s proposed emissions trading scheme, so I will reflect the views of a few. Geoff Layton of Taringa, who has kindly given me his consent to mention his name, said:

Dear Michael …

I’m writing about the emissions trading scheme the Parliament will vote on in November.

The Government’s proposed scheme (the CPRS) puts a new tax on coal mines that won’t reduce global carbon emissions.

Why damage Australia’s most successful export industry, cause mines to close prematurely, reduce mine investment and see thousands of jobs lost?

We need a fair law that does more to cut emissions, not jobs.

Geoff Layton writes about coal and, as I mentioned, coal is worth some $46.4 billion in revenue to Australia. I also want to thank and quote Alex Vikulov, who has also given me permission to mention the words he emailed to me. He said:

I am a professional meteorologist. Water vapour is by far the main contributor to green house effect (100 times more than CO2). CO2 has nothing to do with climate change. Do not waste resources fighting the wrong cause. Climate has always been and will always remain changeable. Instead of creating Climate Change Ministry and wasting resources, concentrate on real issues, i.e. developing renewable energy not because of “climate change”, but because current energy sources are not renewable.

Alex Vikulov has a different angle to this issue. He is focused on the aspect of energy and the fact that we should be focusing more on trying to promote the renewable energy sector in this country. I want to also quote Craig Woodman, who has also kindly given me his permission to reflect his views. Craig, who is a Ryan constituent living in the suburb of Kenmore Hills in the western suburbs of Brisbane, said:

Michael, I work in the mining industry and the proposed emissions tax (it is not credits or a trading scheme—it is a tax) does not make sense. How can a mine be taxed for something it cannot control. Will China, Columbia or Indonesia impose taxes like this on their operations. Two of the mines in the organisation I worked for are marginal now, so with the added impost of additional taxes—these will close, with the loss of over 1,500 direct jobs. The flow on effect to electricity, transport, etc will be enormous. This is a stupid scheme, which is ill thought out. Why do Alumina refineries and smelters get 90% exemption as EITE’s, but coal mining does not.

That is Craig Woodman’s view. I randomly picked those constituents of mine. I do not know any of them and I look forward to meeting them in the weeks ahead. They reflect an overwhelming view in the Ryan electorate. They go to renewable energy, they go to the impost of this tax and they go to security of jobs and security of employment. They also touch on what is supposed to be the purpose of this legislation at the end of the day, which is to reduce greenhouse emissions, to try and protect our community and to protect our country, because we as one nation in the international community contribute to greenhouse gases.

That takes me to another point I want to mention about the contribution to global emissions by various countries in the world. I have the 2006 table from the National Energy Authority showing various percentages that nations contribute to greenhouse emissions. Let me say first of all—and I think this is widely known—that China is the No. 1 country in the world and contributed the most in greenhouse emissions, with 21.5 per cent, as shown in the table. The United States contributed 20.2 per cent. The European Union contributed 13.8 per cent, and that does not include Germany, the UK or Italy, which have been given separate percentages. I will come to them in a minute. Russia contributed 5.5 per cent. India contributed 5.3 per cent. Japan contributed 4.6 per cent. Germany contributed 2.8 per cent. The United Kingdom contributed two per cent. Canada contributed 1.9 per cent. South Korea contributed 1.7 per cent. Italy, a member of the European Union, contributed 1.7 per cent. France also held a separate line item and is No. 14 on the table of global emissions contributors and contributed 1.4 per cent. Even Saudi Arabia is above Australia at 1.3 per cent.

Where does Australia rank in our global emissions? On the 2006 table that I have here, Australia contributes 1.3 per cent of world emissions. So, even if Australia were to switch off overnight, even if Australia were to not have one single power light on in any home in this country or if not even a single vehicle were to start its engine in Australia at any given time, Australia’s contribution would be a reduction of 1.3 per cent annually. Yet here we are with the federal Labor government seeking to compromise the Australian economy and the Australian people’s standard of living and economic prosperity by signing us up to an emissions trading scheme that is effectively a tax. It is effectively a penalty on employment, a slap in the face to enterprises and industries that, by their very nature, contribute to emissions.

Let me say on the record for the House and for any of my constituents that might be listening, and also for the entire electorate when I have the opportunity to engage with them, that I am not a sceptic of climate change. I happen to think that climate change is a genuine issue, a real issue. It is one of deep concern for the world and indeed for Australia and Australians to tackle. I am not a scientist. I am not an expert. I have no technical background. So who am I to say that this is fundamentally 100 per cent absolutely correct or fundamentally 100 per cent absolutely incorrect? I am just a regular guy that has an interest in my community and my society and a deep desire for my country to deliver to its people the very best livelihoods and the very best opportunities we possibly can.

As a regular guy, what do I do as a legislator? Where do I go for opinion? Where do I go for advice? I go to the experts. I have to make a judgment in the end. I also have to back my own intellectual abilities and my own sense of judgment. I take the view that, if I do not absolutely know what the case is, I have to go along with the majority of scientific opinion. If that is not a compelling enough case, I take the view of it being an insurance policy, of giving the issue the benefit of the doubt. It may well be that science and technical know-how in a century’s time prove this is all just a complete con. Conversely, it may prove that this was indeed a substantive issue. Therefore I take out an insurance policy today. I hope very much that my house does not burn down. I hope very much that my home is safe and secure. But there may be a moment where circumstances collude and my house catches fire. In such circumstances I would be relieved that I have taken out an insurance policy. So let us give the planet the benefit of the doubt. It is better to be prudent and cautious, to be safe rather than sorry. It is better to be prudent and cautious rather than regretful, wishing we had done otherwise. I put firmly on the record for the electorate of Ryan that climate change is clearly an issue for all of us to do our bit on, as individuals, households and nations.

That is very different from our doing so as part of a global solution. I read out before the percentages that countries contribute to global emissions. We simply cannot tackle this issue on our own. We must come together as a global community to tackle this issue of global climate change. This is what Copenhagen is all about. It is technically about the targets, which both the government and the opposition have signed up to: a five per cent reduction on our 1990 levels by 2020. That is what Copenhagen is technically about. But Copenhagen is also a platform for the leaders of the world—the heads of government and those with the know-how—to come together, hopefully in goodwill, to carve out and to craft a global solution.

In the absence of that happening, it just defies logic that Australia should run a million miles in front of everybody else and beat our chests and say: ‘Look at us. Look how great we are. We have legislated an emissions trading scheme in Australia that will tax all these industries that employ so many people, that contribute to the livelihoods of so many families, that contribute to the economic activity of so many communities.’ It just defies logic that we should do that. I remind those that would contend with me about the significance of Copenhagen, in terms of its timing, that there are only 40 days to go. It is only a matter of weeks. Why should we legislate this right now when we have no idea what the great emitters are doing, what the great countries, in all their wisdom, are doing—countries like the United States, China, India and others? We do not know what they are going to do. So why do this now?

What we should be focusing on is the renewables—and I regret that time is getting away from me. We should be focusing on renewable energy at home. We should be investing in solar. We should be investing in wind. We should be investing in tidal. We should be investing in ethanol. And one that has come to my attention is algae. I suspect that not many people know about algae, but we should be investing in it. We should be looking at those alternative and renewable sources of energy, because one thing is for certain: the world today has six billion people; in decades time, in 30 years time, there will be nine billion human beings on the planet. The desire for energy will increase. The desire for energy consumption will increase. We must look at that. We must also look at nuclear energy. We cannot put our heads in the sand and say, ‘It’s okay for France to have nuclear energy and the UK and Russia and China and America—but not Australia.’ South Africa is going down the nuclear path. Let us also do so. This is a source of incredible revenue for our country. It is an emissions-free source of energy. We have to do something in the renewable energy and alternative energy space.

We must not put a tax right now on Australian industry and jobs. I am for climate change measures. I am for energy security. I am for renewable energy and alternative energy. I am for doing something to secure the prosperity of our country, the employment of our young people and the empowerment of our industries and our businesses to go forward, to shine and to innovate in the world. (Time expired)

12:00 pm

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

I rise today to speak on the Carbon Pollution Reduction Scheme Bill 2009 [No. 2] and cognate bills. There is no doubt that the Labor government’s emissions trading scheme legislation is seriously flawed and will cost Australian jobs. It will cost investment and compromise our historic, natural, internationally competitive advantage of cheap energy as well as increase the potential for carbon leakage. As a result of these very real flaws, the coalition is proposing amendments designed to lessen the impact on industry, business, consumers, regional communities and economies, so saving Australian jobs yet achieving the same environmental targets. Our commonsense amendments will prevent the shutdown of industries that are essential to the Australian economy—industries that provide jobs in regional communities as well as contribute both directly and indirectly to regional, state and national economies. They include key export industries, including those in coalmining, aluminium, natural gas, food processing and agriculture.

The coalition has very serious concerns about the flawed Labor government ETS for all trade-exposed industries, small and medium businesses and energy generators—those that provide regional jobs and support local and regional communities and local, state and federal economies. Australia’s treatment of emissions-intensive trade-exposed industries must be comparable with the treatment of trade-exposed industries in the United States and the European Union, given the assistance in the proposed US and phase 3 EU trading schemes. One amendment is the exclusion of coalmine fugitive emissions. The government’s ETS proposal will cost the industry billions of dollars. It will cost jobs whilst having little or no environmental benefit. The Minerals Council of Australia stated in the Australian on the 22 September that the Labor government’s ETS plans ‘were far too tough compared with new European Commission ETS proposals’ and ‘would cripple the ability of Australian companies to compete’ against European companies.

The Labor government’s ETS compromises WA’s current energy security through the treatment of our black-coal energy generators. It totally ignores the fact that WA has no brown-coal energy generators and is not connected to the much larger National Energy Market and that WA, as an energy island, has to remain self-sufficient in managing its security of supply. Black-coal energy generators in the WA Energy Market have, by necessity, struck long-term contracts. There is no consideration of this in the ETS. In the WA electricity market the pass-through mechanisms for carbon costs are completely different to those in the NEM—again not reflected in the Electricity Sector Adjustment Scheme as less than one per cent of the ESAS assistance will be allocated to WA under the Labor scheme. The WA electricity market needs a separate ESAS formula and cut-off emission intensity applying a consistent design to both the WEM and NEM, based on the relative proportions and intensities of each market.

The coalition will also continue to advocate an intensity based cap and trade model for electricity generators, delivering the same emission cuts as the ETS but with a much less increase in electricity prices. Coal fired generators must also be better compensated for the loss of value they will experience from the ETS, to ensure security of electricity supply and to enable them to transition to lower emissions energy sources. Increasing the price of electricity to small businesses by 20 per cent in the first two years of this scheme will compromise the viability and profitability of thousands of small businesses which receive no compensation at all for their higher power bills under Labor’s ETS. Many of the approximately 13,400 small businesses in my electorate of Forrest will find it difficult to remain viable and compete with a 20 per cent increase in costs. The coal industry is a major employer of over 600 people in my electorate. Overall, the coal industry employs over 36,000 people in Australia. Yet the Labor government is clearly willing to jeopardise these and many other Australians’ jobs through this legislation that will see the Chinese, Japanese and others buying coal from other countries that do not impose ETS taxes.

The Australian Aluminium Council have stated that they support a well-designed emissions trading scheme. However, there are a number of fundamental changes that need to be made to the legislation. They have said that the CPRS will add $2 billion in costs in the first decade. Worsley Alumina is a major employer of over 1,200 people directly in my electorate, plus contractors. The alumina and aluminium industries are major, mostly regional employers of around 17,000 people across Australia, 6,000 of whom are employed in Western Australia. These industries’ companies add significantly to local and regional communities and economies. The coalition’s amendments will assist the alumina and aluminium industries in Australia to remain globally competitive and, as well, to have access to competitive energy availability and pricing.

In my electorate Perdaman Chemicals and Fertilisers are a prospective new industry hoping to produce urea at a project site in the town of Collie. Perdaman will use local coal as their feedstock for their urea-manufacturing process and will then gasify the coal and utilise the hydrocarbons in the gas to produce urea for export to India. The project will be a major employer, injecting millions into the local and national economies. The most significant problem that this project and their industry face is that, under the particular system of the proposed ETS, their coal ‘feedback’ will be treated as equivalent to natural gas rather than coal. Coal has an allocative baseline for permits at 90 per cent emission level whereas natural gas has only 65 per cent. This single decision alone under the ETS will make the project potentially unviable. I understand that Perdaman’s coal gasification process will be 40 per cent cleaner than standard coal fired power generation.

The coalition will also empower business and community groups to participate in voluntary measures to directly contribute to the reduction of greenhouse gas emissions through measures such as energy efficiency. However, even with our amendments, the coalition has consistently argued that it is reckless for the Labor government to push ahead with this legislation prior to the Copenhagen summit in December, particularly before we know what the rest of the world is doing.

And we are not alone. Caltex chief executive, Julian Segal, described the government’s proposed scheme as ‘flawed’ and said:

…if it was introduced, Caltex would not invest more funds in its two Australian refineries, as it would be cheaper to operate refineries in Singapore, where there were no plans to introduce an emissions trading scheme.

He also stated:

If we are going to say this scheme is about reducing gases we need to be genuine about it and make sure we don’t push emissions from Australia somewhere else.

A recent survey by the Australian Industry Group stated:

Many Australian businesses—

including small businesses—

are actively managing their carbon footprints.

…            …            …

Almost three quarters of businesses (74%) are currently measuring their firm’s overall carbon footprint or plan to do

so over the next three years.

…            …            …

More than 60% of businesses have taken steps or plan over the next three years to invest in “cleaner” capital equipment …

With the additional costs of fuel in regional and remote areas, which are at least 10 per cent higher than in Perth in my state of Western Australia, and the significant distances, energy, general transport of goods, agricultural inputs and other service increases, businesses and households in regional and remote areas will be disproportionately affected by the Labor government’s ETS legislation. I would hate to think that any pensioner does not turn their lights or heater on as a result.

Western Australia derives 46.7 per cent of its income from exports compared to 20.5 per cent of the national income for 2006-07, which shows this is a direct market and trade exposure and WA’s economy is the most exposed and at risk of any state to carbon leakage. I note that the Western Australian government, in its submission to the green paper, made the following recommendations:

The Commonwealth Government should ensure that remote operations and communities with no short-term access to lower emissions energy substitutes do not face disproportionate disadvantage.

…            …            …

The cost of providing essential services such as power and water will rise in response to the CPRS. This is likely to increase the value of existing concessions and assistance provided by the State Government to households by at least $6 million a year if the State was to fully mitigate the impact of the CPRS.

The WA government noted that the lack of economic models available in the legislation to perform comprehensive activity analysis was an issue. The limited detail and regulations in the government’s legislation are clearly deliberate, to disguise the full costs and prevent individual industries, sectors and businesses and even consumers from being able to fully evaluate the economic impacts and costs of the government’s ETS.

This is an abject failing of the government for a policy that will have such a profound impact right across the economy. Why has the government not released the Treasury modelling on the impact of the ETS on Australian industry, business, employment or costs of living and provided comprehensive regional cost-benefit analysis? Much of the assistance provided by the government to consumers is short-term only.

The coalition proposes to permanently exclude agricultural emissions from the ETS, aligning the Australian scheme more closely with the proposed United States and phase 3 European Union schemes. Australian farmers, like all EITE industries, are simply asking for a reasonably level playing field. It is one industry that already has to compete with countries that have tariffs and protections. The Labor government ETS will further disadvantage Australian farmers, food processors and exporters

The coalition will allow agricultural offsets for farmers, including carbon sequestration in soils, vegetation and trees, providing an opportunity for our farmers as well as driving financial and land management benefits in the rural and regional areas. This is a win-win situation for farmers, the environment and the economy. No other country is including agriculture in their scheme. The Canadians are not. The Americans are not. The Europeans are not. But the Labor government is. ABARE in their publication Issues Insights stated:

Like all sectors of the economy, agriculture will face higher input costs because of the CPRS from 2011. This is a direct result of placing a price on non agricultural greenhouse gas emissions.

Even more importantly, ABARE stated:

There may also be a CPRS related cost-price pass-through from downstream processors to farmers that lowers the prices farmers receive for their produce.

Effectively, under the government’s ETS legislation, Australia’s approximately 150,000 farming businesses and family farms will be hit with a carbon tax across their input costs—for fertiliser, fuels, freight, electricity and chemicals to name just a few. As we on this side are aware, farmers are price takers; they cannot pass on additional costs. But they will also have to accept lower prices for their products from processors that can pass their costs back to their source of supply, the farmers. Farmers will become less competitive in international markets as well as having to compete with imported and sometimes dumped products that do not bear the additional compounding costs of an ETS. But under the Labor government, farmers will have no capacity to generate carbon credits.

There is no doubt that Labor’s ETS will reduce farm profitability. Broad acre cropping enterprises, dairy, with its dependence on electricity, the beef and sheep industry, horticulture and vegetable producers will all reduce their farm cash margins. The agriculture and food processing sectors will face cost increases. Those with over 25 kilotonnes of carbon dioxide equivalent will have to buy permits. ABARE stated:

The processing sector is highly trade exposed and so it is expected that the full extent of increased costs will not be passed on to consumers … some of these increased costs to the processor will be passed on to agricultural producers in the form of lower prices paid for the inputs to the processing sector such as wool, livestock and milk, etc.

We are yet to see the administrative complexity of trying to identify diverse emissions from different enterprises on a single farm, for instance a mixed farming operation of dairy, beef, vegetables, cropping. There will be significant administrative costs for all businesses; and for family owned and run businesses there will be an additional time cost as well.

Over the last financial year, Western Australia exported approximately $6 billion worth of food and agricultural commodities, and much of this was from my electorate of Forrest. This represents a growth in value of agrifood exports of 28 per cent in 2008-09. Having less than 10 per cent of Australia’s farms, WA produces nearly 20 per cent of Australia’s total agricultural and food exports, which has assisted in keeping Australia out of technical recession over the past 18 months. Given this, it is understandable that farmers in my electorate are seriously and very rightly concerned about the impact the Labor government’s ETS will have not only on their farms but also on their regional and rural communities.

The Senate standing committee inquiry into climate change in the Australian agricultural sector noted in their final report:

… there is little evidence of work being done on the impacts of climate change on rural communities.

The Labor government’s ETS will see Australian farmers disadvantaged compared to US farmers and the proposed US legislation. Not only are US farmers exempt from coverage but sequestration options and periods further disadvantage Australian agriculture. The Labor government ETS does not provide for the considerable existing sequestration capacity of annual and perennial crop and pasture cycles, as well as other on-farm practices. We have some of the best in the world. The US offers sequestration options for agricultural, grassland, rangeland and management practices, changes in carbon stocks attributed to land use change and forestry activities, as well as manure management and disposal. Even with forestry plantings, Australian farmers are at a disadvantage compared to what is projected for US farmers, with the forestry sequestration period for Australia being 70 years after trees reach maturity and in the US it is 20 years.

A further issue for agriculture in Australia is the food security issue—the loss of quality food-producing land to extensive carbon sink forests, which impacts not only on farmers themselves but also on their communities and the broader economy. In their submission to the Senate inquiry into climate change, citing the Australian agricultural sector final report, the ACCC stated:

If adapting to climate change proves too difficult in some areas, populations will decline and the abandonment of rural towns and farming areas could follow, with the consequent loss of local history, culture and dire natural resource implications. The advent of weeds, pests, disease and erosion could be considerable resulting from the exodus from certain rural and remote areas.

Is the Labor government prepared to facilitate this through a flawed ETS? From day one of the government’s ETS, farmers will pay more for virtually every input. Their costs of production will increase and their profits will decrease. It is that simple.

A Climate Institute paper recently acknowledged that there is a raft of challenges to be overcome before agriculture can be cost-effectively linked to the CPRS, acknowledging the issue of leakage and that higher farm costs makes overseas products not subject to emissions charges more competitive.

I note that the WA Farmers Federation spokesman for climate change summarised the opinion. What he would like to see is farmers being able to participate in the carbon market on both sides, as we in the coalition have proposed, recognising that, yes, they do put some methane into the air but also that they sequester carbon. Farmers are good carbon managers. In the last 15 years we have reduced emissions, or potential emissions, by 40 per cent, and it is basically those reductions that have allowed Australia to meet its Kyoto target. That was discussed on the ABC Rural Report this week. An article in the Weekly Times by the Australian Dairy Industry Council, referring to the dairy processing sector, stated:

Our industry is highly trade-exposed and our Government’s … Carbon Pollution Reduction Scheme plan leaves us vulnerable to losing export markets to other countries whose policies differ significantly.

In my electorate of Forrest there has been a lot of investigation into sources of renewable energy. A lot can be achieved in Australia through energy efficiencies. We have heard this consistently from the member for O’Connor about the transmission sector: how and when energy is used and the integration of systems. Earlier this month, West Perth based Green Rock Energy announced that it had been granted three geothermal exploration permits within the town of Collie in my electorate, where a substantial proportion of Perth’s electricity supply is generated from power stations. I recently hosted an energy diversity forum in my electorate to provide information about current and future energy sources, including tidal, wind power and geothermal energy. The potential of converting CO2 to oil and stockfeed through algae is also being investigated, potentially for my electorate.

In conclusion, the coalition supports the view that it is reckless for the Labor government to insist that Australia locks in its emissions trading scheme ahead of the rest of the world. I support the coalition’s amendments to this seriously flawed Labor government ETS.

Photo of Dick AdamsDick Adams (Lyons, Australian Labor Party) Share this | | Hansard source

The question is that the words proposed stand as part of the question. The honourable member for Slipper—the honourable member for Fisher.

12:20 pm

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

I thank you, Mr Deputy Speaker Adams, for saying that. While I am a member of this House, there should be an electorate named after me! That is a rare compliment. I thank you, Sir, for making that particular observation.

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

Hear, hear!

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

We must remember that, as Australians, we hold our environment in trust for future generations. All of us, I suspect, are much greener than we once were. I have to thank my wife, Ingé, for some of my education in this area. At home we compost all vegetable matter, we have brought in water-wise measures, we endeavour not to have taps on for as long as they once were, and we also have sought to dim the lights and not have the place looking like a Christmas tree. But I am not an expert on climate change and I suspect that most members of this House, and indeed the community generally, would not be experts on climate change.

There is no doubt that there is conflicting scientific evidence. There is respectable scientific evidence supporting the existence of climate change and there is also contradictory scientific evidence denying it. There is a view that climate has always changed, that it will continue to change and that there is nothing dramatic about today’s climate change, but all of us would agree that the issue should be given the benefit of the doubt. If we in the world and as a community are able to do something to bring about cleaner air and less pollution, then obviously these are steps in the right direction.

I am someone who believes that Australia, which produces only 1.4 per cent of the world’s emissions, has a responsibility as a good corporate citizen to play its part as part of the world community in bringing about a world solution. The scheme covered by the Carbon Pollution Reduction Scheme Bill 2009 and supporting legislation is, however, an unmitigated disaster. It is obvious that the CPRS as proposed by the government will destroy the competitiveness of Australian exports, will cost Australian jobs, and will reduce investment in our economy. And that is simply not a good thing because we are competing with the rest of the world. The scheme would also lead to emissions being sent overseas rather than being reduced at the global level and as a result there would be no net benefit to the world environment.

The CPRS also represents a tax grab disguised by the fact that the government has only published one year of estimates of the full fiscal impact of the scheme. A bit like the alcopops tax, the CPRS scheme is simply another tax grab by the Rudd Labor government. I find it absolutely unbelievable that about a month before Copenhagen, and certainly before the United States has made its position crystal clear, the government wants us to rush legislation through the parliament. It wants to commit us to a situation before we know what the rest of the world is doing.

The Liberal-National opposition is proposing amendments to the government’s legislation. There is no doubt in my view that the six key areas of amendments will bring about important improvements to this fatally flawed Labor Party legislation. I just want to outline broadly these amendments and changes. They are: placing Australian emissions-intensive trade-exposed industries on a level playing field with their competitors abroad; excluding agriculture from the scheme and providing a mechanism for farmers to earn offset credits when they abate carbon; ensuring Australian coal producers reduce their fugitive emissions as technology allows but are not unfairly financially penalised compared to competitors; moderating the impact of higher electricity charges on small business; and providing assistance to coal fired electricity generators to ensure they remain financially viable and the lights stay on.

These important amendments and changes to the legislation will substantially improve the legislation. The Minerals Council of Australia has said, however, that the CPRS will impose significant imposts on the Australian economy that are not faced by Australia’s competitors and it comes to this conclusion even if all of the Liberal-National opposition’s proposed amendments are adopted. Further, it considers the level of industry assistance given to the scheme to be inadequate compared to other schemes, particularly the emissions trading scheme of the European Union.

I am one of those people who believe that it is irresponsible to proceed with this legislation until such time as we know what the world is doing. There is no doubt that, while there has been substantial discussion in the Australian community, there is an increasing concern amongst Australians that we ought not to, in effect, put our collective national neck on the chopping block before we know what rest of the world is doing. Even if we brought in the most draconian scheme, which is being proposed by the government, and even if we were able to reduce emissions in Australia, we only produce 1.4 per cent of the world’s emissions and so the reduction in emissions in Australia will make little difference to the reduction of emissions worldwide and the price that we will have paid is that Australians will be thrown on the unemployment scrapheap, Australian industry will fail, Australian investment will falter, and Australian exports will not be competitive in the world marketplace.

Increasingly, the world is a global village and we have to look upon ourselves as being an international citizen of the world. I could understand if the government was coming into the parliament and was saying that there is no world solution in sight so therefore we ought to show an example. But why on earth is the government insisting on proceeding at this stage just a month before Copenhagen to commit Australia, to threaten Australian jobs, to threaten Australian industry, to threaten Australian exports and to threaten Australian competitiveness?

I think that the answer to the question I pose is that the government is playing naked politics. The government is seeking a double dissolution trigger, because it wants to be able to put itself forward as a government which has an idea and it wants to show that the opposition is divided on this issue. The reality is that the government is the government of Australia. It should be the government for all people. It should not be playing cheap, petty politics at the cost of Australian jobs, Australian industry and at the cost of Australian exports. The government should defer all this legislation until after Copenhagen and until after we know what the world community is doing, and also of course until we know what the United States, an important part of the world community, is doing. It is patently irresponsible to sacrifice Australian jobs, Australian industry, Australian exports and Australian competitiveness on the altar of political expediency, and that is exactly what the Rudd Labor government is seeking to do.

I said before that I do support the amendments which are being negotiated by the Liberal-National opposition with the government. Any amendments which are accepted by the government will improve the legislation. But it is my view that, even if the government accepted every last one of the opposition amendments, it would still be an act of economic vandalism to vote for this legislation, as amended, before Copenhagen and before the United States makes its position clear.

I will repeat that: it would be an act of gross economic vandalism to vote for this legislation, even if all of our amendments are accepted, because the legislation will still be flawed. Admittedly, it will be an improved piece of legislation but it will still be flawed. We ought not to be proceeding before Copenhagen, before the world community makes its decision and before the United States makes its position clear.

I said at the outset that I am not an expert on climate change. I would be the first to admit that I am not an expert on climate change and I am sure that I am not alone in that situation. But I just do not see how anyone can rationally argue that we should sacrifice Australian jobs, we should cost Australian industry, we should destroy our competitiveness, we should kill off investment on the altar of political expediency. So I will make a plea to the government: stop playing politics and for once look at the interests of the country.

12:30 pm

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

Contrary to the previous speaker and to several of the speeches heard yesterday and today, I am one who is giving the green light to the government to get the Carbon Pollution Reduction Scheme Bill 2009 [No. 2] and the framework legislation through this parliament. Rather than this being a pre-emptive discussion two months before Copenhagen, I believe that this is a bit like groundhog day, where we in the political circles are repeating a discussion that has gone on since the time of former environment minister Robert Hill and former Prime Minister John Howard. We have had an election in which this was a central issue and we have had reports from eminent authorities such as Ross Garnaut. This issue has been around for a fair amount of time now for everyone in the political process to make clear decisions. In my view the world is moving in response and I think that Australia, in its national interest, should also move in response.

The comment from the previous speaker—and I think I have heard it verbatim from others—is that we have got to wait until we know what the world is doing. In response to that, I say, ‘We do know what the world is doing.’ The world is responding to the issue of climate change and it is responding significantly en masse through the form of trading schemes. We have already seen trading schemes put in place in many developed countries, such as in many European countries, which for some reason seem repeatedly to lead the way on these issues. Also, we are seeing that in many other countries where trading schemes are not in place they are at various stages of development for being put into place. I think it is a furphy to say that the world needs to wait and that countries need to wait for Copenhagen. There is far too much weight being put on that meeting of leaders on that date. In reality, countries are moving to market based responses to the natural resources management question of our time. Also, we are seeing in countries all around the world at the moment schemes either put in place or in development, and I would hope that Australia does not get left behind in the political positioning we see in this place and the other place.

My position has not changed since the last time. I am giving the green light to the government to progress this legislation and get the framework for a carbon pollution reduction scheme and an emissions trading scheme up and running within Australia. I do that by not necessarily supporting a Labor emissions trading scheme—a term that I have heard being thrown around—but it is just as easy to say that I support a Robert Hill/John Howard emissions trading scheme, which this government has really adopted and put in the public domain. We are now seeing it debated and hopefully will see it progress through on this second attempt.

I will again run through the reasons I support it. I believe that most people in this place are accepting of the science in regards to the issue of human based influence on the climate. I accept that there are those in this place who have not, for very genuine reasons—I am not one to use the word ‘sceptic’. If you jump through that gate of logic that accepts the science it becomes a question of a response in regards to how we as a country and as a world put together a policy response to minimise and, hopefully, start to turn around this issue of the human based influence on global warming.

As far as a response is concerned, jumping again through those gates of logic, I see that it comes down to three options. There is the ‘do nothing’ option in which we place the risk on future generations. We cross our fingers and hope that it is going to go away or that the human based influence on the climate today is not as we expected. The second option is a completely publicly owned response, which would in most cases be in the form of a carbon tax. That would be a direct and significant cost on consumables throughout Australia and in any market in which such a public based response was put in place. The third option is a market based response where it is an exercise in building a framework, in engaging the private sector through the policy development and in developing a market based response to try to minimise carbon outputs which will, hopefully, minimise human based influences.

If I jump through that first gate of logic, which is, ‘Yes, there are human based influences,’ then, out of the three options that I see as being available, I choose the third option, which is a market based response. I do that because I think there are higher costs involved if it is a publicly owned response, if it is a carbon tax. I think that is going to be a huge cost on the community of Australia. I also choose a market based response over the do-nothing option, because I think it accepts risk. We do need to consider in all of this that no-one is the holder of all wisdom. But if we are risk mitigators then a market based response is much less risky than the do-nothing, ‘cross the fingers and leave it for future generations’ approach.

The previous speaker asked for someone to explain their position. I hope I have done that as clearly as possible. I choose to green-light the government on this. This is, if anything, quite ironically, a Liberal based response, if we are talking about the type of engagement of the private sector. Traditionally, an emissions trading scheme would be a Liberal type of response in Australian politics to this issue of human based climate change. So it is a little bit ironic to see the political positioning going on at the moment. However, that is the nature of Australian politics.

In choosing that third option of the market based response, and green-lighting this process, I would hate anyone to think I am 100 per cent, cut-and-bleed sworn up to the model that the government has on the table with regard to that broader concept of a market based response. I think they can do better. I would certainly be one to hope that over time we can see this legislation improved. In my view it is very important that in this case we actually do let the market rip, which seems to have been a source of nervousness for government in their position earlier this year. If we are going to go down this path of having a market based response, we want to allow the market to operate in its most healthy way possible, and any exemptions and compensations are chipping away at the edges of allowing that market to rip.

I would hope that anyone who has done economics 101 would accept as a broad argument that, if we are going to go down this market based path, we want to give the market its full steam. That is where I think there are some concerns. I can understand why the government is having to dumb down this legislation to get it through the parliament, but I think there are some concerns about the future that we do need to address over time. We need to look at all those impediments that have been built into what is a market based response to a science question to get this legislation through the parliament that over time may actually work against a market based response and may therefore not answer the question that we are being posed with as well as it could.

An example of that is the amount of compensation to the big emitters. There is a finite amount of dollars—and a good, healthy finite amount of dollars—involved in this trading scheme. There are other examples of other schemes around the world where there is greater emphasis on offset dollars going to good biodiversity outcomes. In an Australian context what it could be is good soil erosion, water or coastal erosion outcomes—the topic of the week—good, uniquely Australian outcomes. However, this finite amount of dollars is being tipped in a different direction, and that is compensation to the big emitters. I think that is of concern to those who want to see some uniquely Australian outcomes in the long term from such a scheme as this.

There are good potential opportunities written into the legislation. I mentioned reafforestation as one. There is great potential in the concepts on the table in that regard. However, we are seeing, for political reasons, the money tipped in a direction which is trying to get this legislation through but, potentially in the long term, is not in the legislation’s interests and not in the national interest. I would hope that over time we can consider that more thoroughly. I would hope we can find a way to put greater emphasis on these uniquely Australian outcomes from such a scheme. Biodiversity is a big one that I would hope we could see written into this legislation in a better way. Soil erosion, water salinity and the vast array of uniquely Australian issues that we face today can potentially start to be addressed by a scheme that sees a greater emphasis on offsets moneys rather than on compensating big emitters.

In an area such as the mid-North Coast of New South Wales, we do not have big emitters. We are the land of small business, and I think we are reflective of Australia. Ninety-five per cent of our employment is in businesses of five employees or fewer. We are reflective of the country. The engine room of this country is small business. I would hope that, when this legislation passes, there is a great deal of engagement with the small business community in the potential opportunities through this scheme. This cannot be the Goldman Sachs scheme. This cannot be the big emitters’ scheme. This has to be a scheme for Australia and this has to be a scheme for the small business community of Australia. It has to be clearly laid out to many people who do not have the time to go through 440 pages of legislation. It has to clearly lay out the potential opportunities—and there are many—that are in this legislation for regional small businesses in particular. I hope the government will take that up when this legislation passes.

Also with regard to improving this legislation, I do want to comment about the amendments that have been put on the table so far. My colleague the member for New England has one that I would hope this place considers relating to the food chain. I have heard many comments already about the importance of food. I concur with all of those. I therefore think that is an amendment worthy of consideration by government. Rather than looking at it as agriculture generally—because that considers things such as timber, and you cannot eat wood—I think focusing on food and the supply chain is quite a valuable and important way of value-adding to this legislation. I will be sitting alongside my colleague there.

With regard to the coalition amendment, particularly about agriculture, I also concur with those thoughts on the full exemption of agriculture. I have to get on record my very good friend Sinclair Monroe, the Angus farmer from Bingara, who constantly reminds me: how on earth is he expected to monitor his cows’ farts? I think he has a good argument! Exempting agriculture, for reasons very similar in nature to the member for New England’s food supply chain argument, makes sense as we enter an era and a century where food supply is going to increase as an issue of our time and also increase as an issue that will create unrest within regions such as the Asia-Pacific region.

I will be putting up the same amendment as I put up the first time round with regard to the issue of who actually has authority, control and discretion over this legislation once it is passed. The issue of ministerial discretion and ministerial control at the end of the process is a sleeper in this legislation and it has not had the airtime that it deserves. On my reading of the legislation, I came up with roughly 23 or 24 brand-new concepts and market economy theories that are part of this framework of the suite of CPRS legislation. The ultimate authority at the end of the day in pretty much all of those concepts and theories is the minister, whether it is about targets and caps or about the issuing of licences. All of those big, key framework questions are not driven by the science, where we started with this issue and this problem; they are driven by the politics and by the minister of the day. That is an issue that I certainly hope the government thinks deeply about, once this dumbed-down legislation can get through this place. For example, there is the issue of fuel credits. What minister, what government or what executive wants to own the day that sees the removal of fuel credits? I think it is as much in the minister’s and the executive’s interests as it is in the interests of allowing the science to fly that we consider those issues of ministerial discretion that are built into this legislation. Therefore, I once again put up the amendment that tries to establish an independent, arms-length, science based view of the economy and an independent regulatory authority that starts to take care of those framework questions for the good and the bad—basically removing the politics from this issue and making it a science and economy exercise, not a politics and economy exercise, as it has quite clearly been over the last 12 to 18 months.

I certainly hope I get more than two other supporters on that legislation the second time around. I spoke to the minister about it previously and she was very polite in her understanding of it; there is just a philosophical point of difference in that the current government argues the case that it is such an important issue that parliament and the minister should have carriage of it. I take a different view on that philosophical standpoint and that is that it is such an important issue that it should not be part of the political process a la monetary policy, a la competition policy and the range of other independent, arms-length entities that we have built into this process at a time when issues are and quite rightly should be above the politics of the day.

I give this government the green light again this second time round. It is not a full endorsement. I am in the Ross Garnaut camp that this legislation has got to the point where you could be six of one or half a dozen to the other with regard to whether or not you support it. I understand the reasons for the efforts to get this legislation through. I encourage those who the first time round were in opposition to think about that point. If you are opposed to an emissions based and a market based trading scheme then you must be in the camp of the other two, which is the do-nothing answer or the publicly owned carbon tax answer. You cannot build an argument to justify both of those positions. This framework was shaped around a trading scheme first proposed by Robert Hill who has been in another job and left it already—that is how long this has been floating around. This was proposed some time ago by the previous regime and it has been picked up by this regime. I would ask this place and the other place to consider that, to let us move forward in getting the response to the natural resource question of our time sorted out and to do it in the national interest.

12:50 pm

Photo of Dennis JensenDennis Jensen (Tangney, Liberal Party) Share this | | Hansard source

The Carbon Pollution Reduction Scheme Bill 2009 [No. 2] has problems on so many levels that I hardly know where to begin. The chain that has led to this would be viewed as implausible in a work of fiction: how a theory of humans causing climate change could end up in a push for significant worldwide economic sacrifices at the altar of the god of climate change. The church that has been set up is the IPCC, with a clear statement of religious belief that humans are causing global warming in their very mission statement.

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

Kev wants to be the Pope.

Photo of Dennis JensenDennis Jensen (Tangney, Liberal Party) Share this | | Hansard source

We are now on track to introduce significant damage to our economy based on a complete turnaround in the onus of proof. The situation is that we are now looking at imposing a significant impost on the Australian people, based on an unproven proposition, and stating that the only way in which that cost will not be imposed is to prove that human beings are not responsible for climate change, as opposed to a proposition that people should not be slugged with costs without proof. Let us have a look at some of the financial aspects and imperatives associated with this extreme tax system that is being tagged with the Orwellian label of ‘Carbon Pollution Reduction Scheme’.

We hear arguments from the alarmist side that big oil is paying enormous amounts on climate change denial science, and that is why you have sceptics with anthropogenic global warming. Nothing could be further from the truth. And there is a huge industry built around the belief in anthropogenic climate change. Big oil has averaged paying $2 million per annum for research on this issue over the last 20 years. Meanwhile, the US government alone has averaged $3 billion to $4 billion per annum over the last 20 years and in total has spent $79 billion, with $7 billion spent this year. Yes, there is a huge imbalance favouring the sceptics. Do you think that is a lot? According to the World Bank, the banks traded $120 billion in carbon dioxide last year alone. This is subprime carbon, and a lot of money is to be made by the same people who brought you the global financial crisis.

For the government there is the significant issue of pecuniary interest. There is a significant amount of money that the government will receive—in Australia’s case $50 billion has been identified. The government clearly sees a combination of royalties from north-west gas fields and carbon taxes as being the solution to the massive debt it has saddled the nation with. In the US, Obama expects $645 billion over 10 years. That is a huge amount of money. Additionally, a huge industry has built up inside the Beltway in Washington DC. There are 2,300 climate lobbyists in Washington DC, or more than four lobbyists per congressman or woman.

So there are very definite financial reasons that this government is pushing for it. The unfortunate reality is that it will cost Australian families thousands of dollars per year to achieve absolutely nothing, even if you believe in the consensus position. I have frequently asked how much the CPRS will reduce global temperatures. As yet, funnily enough, no-one can tell me. This is a lot of money being paid for nothing.

Let us have a look at the science of some of this. Before we do, I want to clarify some issues about peer review. Peer review does not mean that the science and the results are correct; it merely means that the method used was scientifically sustainable. Journals will not publish all papers accepted by peer review. Indeed, there is editorial pressure, as the goal is to sell journals. Additionally, there is a predisposition in science that the review process for an accepted paradigm is less rigorous than when a paper goes against the prevailing wisdom. I will give you two fairly recent examples.

The first is the cold fusion issue of the late 1980s. Fleischmann and Pons, two physical chemists, published a paper which stated that they had discovered cold fusion. There was a flurry of activity in the journals, with papers repeating the results. The problem was that there was no neutron flux, as would be expected with fusion, but this was not picked up by the reviewers.

The second is the Paul Chu and yttrium-barium-calcium-copper oxide, or so-called 123 superconductors. The discovery of this was a huge jump in superconducting critical temperature. Chu was aware of the nature of the breakthrough and was concerned that one of the reviewers of his paper might try to pre-empt him, slow down his own review process and get a paper published himself, so Chu substituted ytterbium for yttrium, which resulted in a material that was not a superconductor. Despite this, the paper passed review. Chu substituted the correct element just prior to publication.

We are told that the globe is burning—to quote the member from Midnight Oil. We are told that sea levels are rising dangerously. We are told that ocean temperatures are warming dangerously. We are told that we are in danger of inundation due to melting icecaps. We are told that the only way to explain the observed climate is with anthropogenic factors included. The globe may have been burning in a metaphoric sense in 1998, but that is certainly not the case now. Using all four data repositories used by the Intergovernmental Panel on Climate Change, the IPCC, it is clear that temperature trends are negative for this century. They are going down. This is certainly not what the IPCC models projected. They projected increasing temperatures for this century, even for the case where carbon dioxide is held constant at year 2000 levels. These inaccurate model projections use the same models that are used to explain the temperature rise between 1975 and 1998 and state that it has been due to anthropogenic causes.

Let us make sure we are on the same page. The models have been unable to predict, even to explain, the temperature reduction of this century, but these selfsame models, demonstrated to be inaccurate in terms of their robustness in prediction, are used to state that the science is settled—that human beings are unequivocally to blame for the 23-year warming trend in the late 20th century. I note that the IPCC is now covering its bases by saying that it expects reductions in temperature for the next 10 to 20 years. Guess what? The heating will then come on even stronger than before. This is not science but religious belief.

The alarmist scientists are also remarkably shy about sharing their data. The head of the Hadley Climatic Research Unit, Phil Jones, said in a request for data from Steve McIntyre: ‘We have 25 years or so invested in the work. Why should we make the data available to you when your aim is to find something wrong with it?’ This is staggering. The whole point of science is to attempt to find something wrong with it. It is called falsification. It has now been found that the Hadley Climatic Research Unit has lost a lot of raw data following the request, but we are supposed to trust that the adjusted data is correct. I guess the next time the tax office asks for receipts I should just say: ‘I don’t have the original receipts. Just trust that my statements on earnings and outgoings are correct.’

There has also been the hockey stick controversy. On a hockey stick graph, global temperatures were supposedly remarkably stable until industrialised society hit the scene. This not only was used extensively in the IPCC’s third assessment report but had been through peer reviewed literature, so theoretically it had been through peer review twice. However, with the IPCC, the reality was that Michael Mann reviewed his own work, so he was hardly an unbiased observer. It was found that bad statistical methods had been used and that in most cases using this technique with random data would result in a hockey stick shaped graph as well. It has taken years for McIntyre to get the original raw data, and it is now apparent that this was worse than bad science; it was fraudulent science. It turns out that Michael Mann had cherry-picked the data. This is someone who is still a lead author with the IPCC. So, contrary to popular propaganda, the globe is not burning and indeed has not been heating this century.

‘Ah,’ the alarmists now say, and: ‘It is really the oceans that hold the key. The oceans are the things that give the state of the planet in heat terms.’ The problem is that the oceans have not been warming since at least 2003, according to Argo buoy data. In case there is any doubt here, there is more data available from between 2003 and now as a result of Argo buoys than there is for all the rest of recorded history of ocean temperatures put together. What does the data show? According to the Argo steering team, there has been no change in temperature over that time. Lyman and Willis et al—no climate change sceptics, it must be added—found a decreasing trend, albeit that statistically speaking it could be stated that there was no trend. Certainly they found no increasing trend. Loehle, in Energy and Environment, another peer review journal, found a decreasing trend since 2003. So there has been atmospheric cooling this century and at best there has been no warming of the ocean since the Argo buoys entered business.

We have heard of the fears of inundation due to rapidly accelerating sea level rise. Professor Will Steffen, Minister Penny Wong’s personal guru on climate change, in a briefing to some parliamentarians suggested that the work of Domingues and Church et al in Nature last year should be used for sea level rise. Problematically, the analysis ends just where the sea level rise stops—that is, in 2005. There have been accelerations and there has been a lack of rise in the sea level over a long period of time, but there has been an underlying upward trend since the end of the last ice age. In effect, what has been observed is a recovery from the Younger Dryas ice age.

What about melting polar icecaps? In a global sense, the area of sea ice today is pretty much the same as it was in 1980. We have all heard about the melting Arctic ice, and it is true that the area of sea ice in the Arctic has decreased somewhat in the last 30 years—although there has been some recovery in the last couple of years. However, how many of you are aware that the Antarctic is cooling and that the area of sea ice in the Antarctic has been increasing for those 30 years? As a little clincher, the theory as accepted by the IPCC is that there should be a hot spot in the upper troposphere, about 10 kilometres up in the tropics. This is a fingerprint for well-mixed greenhouse gases causing warming. To date, despite a lot of looking, no such a hot spot has been found.

So, all in all, there has been a failure of the premise that human beings are heating the planet. We are basing everything on a 20-year period of warming in the late 20th century. The models—the entire ensemble of models used by the IPCC—comprehensively did not predict the cooling that has been observed this century. We see no heating of the oceans since 2003. We see no sea level rise since 2005. We see a relatively stable global sea ice area. Yet we are supposed to bet significant damage to the economy on this failure of predictive capacity of the models. What a joke. Precautionary principle? How about we apply a precautionary principle based on there having to be a clear threat before we spend money on this? How about science comes up with modelling that actually predicts various aspects of global climate, rather than simply saying that models that are able to hindcast previous climates have been validated? There is all of this, yet we know from evidence taken from the CSIRO and the Bureau of Meteorology that we do not even know what causes El Nino events, which are one of the major drivers of global climate.

We are supposed to trust forecasts of global temperature going—get this—1,000 years into the future, from the IPCC Fourth assessment report. This is not science; this is guys and girls having too much fun playing computer games. We are supposed to bet our economy on science that at present is unable to make long-range predictions; we are supposed to believe that they can confidently predict global temperature 1,000 years hence. We are supposed to trust economists like Stern and Garnaut with economic projections 100 years into the future, yet in both cases they were unable to predict the GFC a mere couple of years prior to the event. Here we are talking prophets of the grand religion, not serious science and economics. In order to get a good handle on these issues, I believe that we need to hold a parliamentary inquiry into the science of climate change, where those on both sides of the argument have to give evidence under oath. What is the bet the Rudd government lacks the intestinal fortitude to accept the challenge?

Another reason for my concern is that embarking on setting a price on carbon dioxide is effectively putting a tax on everything and will give the control freaks a level of control over all human enterprise within a nation not seen in democratic history. Indeed, we have observed antidemocratic comments from many so-called environmentalists, calling for the overthrow of democracy and/or capitalism to save the planet. I stated this in an opening address to the Australian Environment Foundation over a week ago, and it turns out that I understated the danger.

Have a look at the draft Copenhagen convention. It looks to, according to section 36 on page 18, the setting up of a government and transferring wealth from First World to Third World countries, and, according to clause 33, page 39:

By 2020 the scale of financial flows to support adaptation in developing countries must be [at least USD 67 billion] [in the range of USD 70–140 billion] per year.

The third point is the issue of this new government being able to enforce these provisions, including:

… the transfer of technical and financial resources from developed countries to developing countries.

There is also an attack on market based economics. Page 18, section 36 of the document reads:

It should include a financial mechanism and a facilitative mechanism drawn up to facilitate the design, adoption and carrying out of public policies, as the prevailing instrument—

and take note of this—

to which the market rules and related dynamics should be subordinate, in order to assure the full, effective and sustained implementation of the Convention.

So we should subordinate our national sovereignty and our entire system of free enterprise so that Kevin Rudd and the Labor Party can go cap in hand—as opposed to cap and trade—to sell out the birthright of every Australian! Throughout our history people have gone to war and died for our sovereignty and way of life. The Rudd government simply wants to hand it over. This is absolutely scandalous and I for one will not be a party to it. Kevin Rudd may want to strut the world stage, but he is so enamoured with the idea that he is willing to burn our economy and sacrifice our sovereignty and free enterprise way of life. I find that reprehensible, but I guess that has always been a Labor dream.

On the science, in my view the IPCC needs to be dissolved. If it is felt that it is necessary to have a global organisation examining climate change, the mission statement needs to change so that human caused climate change is not a given. Climate change needs to be studied without preconceived outcomes relating to human causes. The peer review process needs to be genuine, rather than having comparatively few authors able to simply ignore reviewers’ advice or comments. In that regard, the IPCC has no genuine peer review process, not until such time as a reviewer’s comments cannot simply be ignored, given the predisposition of some authors. That process leads to the institutionalised groupthink that is endemic in the IPCC.

Finally, the process needs to be driven genuinely by scientists in multiple disciplines with differing viewpoints, and the bureaucrats need to stay out of the system in its entirety. The fact that the summary for policymakers of the last assessment report came out months prior to the scientific document and the scientific document had to be scrutinised for potential inconsistencies against the summary for policymakers—meaning that the scientific document would be modified to accord with a bureaucrat’s summary for policymakers—should be anathema to any scientist. Also of concern is the view that everyone, including scientists, should be singing from the same hymn book. The fact is that the scientist who is not sceptical—in other words, who is a true believer—is the scientist of concern. I seek leave to table some documents.

Leave granted.

1:10 pm

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

Fear, optimism and hope are the emotions that charge this debate. As the member for Tangney leaves the chamber, I suspect that some day his words will be read again by thousands of people, if not more, recognising pearls of wisdom in what may well one day come true. It is important that we have that diversity in the debate. I find it very difficult to disagree with much of what he says but I can say one thing: I vehemently disagree with the member for Tangney’s position on this Carbon Pollution Reduction Scheme Bill 2009 [No. 2]. I will be working as hard as I can to have it passed. I will be working with colleagues of mine in both chambers to see that it is passed, but for very, very different reasons: ‘If it helps the environment.’ Let that simple phrase not be forgotten. They are the words of the quiet majority in this country.

I flew Virgin Blue this morning and I had a moment to ask some of the cabin crew, who work in perhaps the most energy and emissions intensive sector we have, what they thought about the debate today. And I say to the seven very worthy audience members in the public gallery who are listening to this debate: you are among the very few who even know we are having this debate at all. That in itself is a criticism of this government for failing to take Australians with them through this process of very important legislation that will have a huge impact on Australia, we know, in a generation to come. Going back to the crew, after that flicker in the eye, that almost ‘beauty pageant’ moment when the answer to a hard question comes into the mind of someone who has never really thought about the problem, it was simple: ‘If it helps the environment.’ In fact, when the entire crew got together to discuss it a little bit more, the same answer came out: it is a very big ‘if’, but ‘if it helps the environment’.

I have to say to the hundreds of people who have lobbied me personally to not support this bill: with the greatest of respect, the case you have made, articulate as it is, forceful as it is, has failed to move beyond the over-50s, mostly male, mostly conservative voters in this country. That is a battle on climate which as so far been lost. I appreciate, as many tell me, that the mood may change and one day the things I say may be less fashionable than they are, but right now, as we consider this bill in the artificial timing forced upon us by the government, the mood is predominantly one of an optimistic young nation that wants to play its role in the world, a nation that wants to be sitting at the table when the only scheme globally under consideration is discussed. We want to be at that table playing a role.

For all the modelling of what damage this ETS could do to our economy and what climate change could do to the globe, the fact is that modelling can change. Value-laden assumptions will always underpin those results. But one thing is for sure: Australia needs to be part of that dialogue. I appreciate that it makes people very uncomfortable that their particular sector has not yet been exempted from the scheme. To them I say we are still 33 months away from pressing ‘go’ on trading, 33 months of negotiation is before us, on regulations that will determine how this ETS works. Today we are discussing only the very basic infrastructure of this legislation. It has been referred to as legislative plumbing. We are simply talking about the structure upon which the functionality of an ETS will be based. That is all we are discussing today.

To my National Party colleagues I say I cannot promise them the concessions that they are probably hoping for from the government but I can say this: whether those concessions are small—and I personally believe that agriculture will be exempted—or whether they are more significant, I still know that this legislation will be placed in front of us, we will have our noses rubbed in it and we will have to vote for or against it. We are a diverse party which represents a diverse community with different views. But I am absolutely determined, in the role I play in this place, to make sure that this bill is passed.

This is a long battle and the closest allegory of it is the trade negotiations which began back in the 1980s—the GATT rounds, the Uruguay Round. Negotiations go back decades and similarly climate negotiations will be a decades-long process. I am absolutely committed that this side of the chamber does not deal itself out of that discussion, which is the great threat. Blocking this bill would leave this issue on the pages of the newspapers for months to come. We would be facing more legislation like this next year, when there are far more important domestic issues which this country needs to engage—but we cannot, until we can move together and at least participate in the Copenhagen process.

To those who will one day read the speech by the member for Tangney and then have a peek at the person who spoke after him—I feel a little like that—let me say this. We will work very hard—me at a personal level in representing my electorate—to see that we are around the table of the ETS, whatever shape it takes. Consider it a game of Monopoly or a game of poker. We do not yet know who is going to win or lose, but if you are not at the table you simply hand the opportunity to someone else to speak on your behalf. I am not prepared to concede that advantage to this Prime Minister.

We have proposed six very simple amendments, upon which time does not allow me to elaborate on. Those amendments are to give protection to Australian jobs in emission intensive industries—it is quite simple—to exempt agriculture from this scheme even after 2015, and to offer opportunities for agricultural offsets, which is Australia’s strategic advantage. We have 770 million hectares of Australia which we can start to re-carbon in order to reduce our emissions.

We need to remember to support our power generators and their battle against fugitive emissions and give them an opportunity to be competitive. We need to look after our small business because Australia is the No. 1 small business economy in the world. We need to allow our power generators to remain viable, whatever that takes, regardless of the Morgan Stanley modelling, which has never been revealed to us; instead it remains in the nest of government, hoarded and protected. We must protect our power generators because they are the spine of our country and we need to ensure that they can maintain the stability of our grid, to provide the power which drives our economy and be there with the adequate resources so that when they need to they can adapt to a clean carbon future. Lastly, we need the ability to provide the alternatives in the form of voluntary offset and abatement opportunities.

They are such common sense amendments. Right now they are rippling around Facebook and YouTube as people listen to a range of groups talking about the importance of these to the Australian economy. Whether we get them or not, I am absolutely and firmly committed to doing everything we can to take this bill through in this sitting. Not everyone will agree with me, so let me make one observation. If we deal ourselves out of the debate at this point, then I must place complete trust in all of this ETS modelling, that the demise of this country, the destruction of our industry and the non-viability of the agricultural sector is a certainty.

I have a sense that we have a Prime Minister—agile enough, smart enough and politically savvy enough—who will go around the country and cut deals next year. I suspect the Prime Minister will be cutting deals with workers in town hall meetings in your state of Tasmania, Deputy Speaker Sidebottom, talking to boardrooms, cutting deals with them, and the whole time surrounded by a miasma of supportive press releases about a generous Prime Minister listening to his electorate. I say to this chamber: we will see almost none of the pain of which many of the sceptics fear, because we have a Prime Minister driven not by ideology on this issue, not by conviction but by political pragmatism. This Prime Minister wants the stage to himself next year. He does not want an opposition standing with him, shoulder to shoulder, saying, ‘Let’s fix this problem together.’ That is why this odious, unmodified and unreformed bill is placed before us today and our noses are rubbed in it, as opposition members, and we are asked to vote for it and potentially harm or own constituents. We have to fight the larger fight. We must be shoulder to shoulder.

By allowing this bill to go through, we can move on to more important tasks. I remind the many colleagues in this chamber what one of those important tasks is: when the opportunity arises, where anti-Australian provisions in the form of regulations are added to this bill, we will, in a unified way, fight against them. It will be at that time that we will be united in an Australia-friendly ETS which allows us to play our role in the international community without the loss of a job and without exporting a gram of carbon. That will be a day when Labor members will wish that in this debate, instead of scurrying into their offices or giving theological diatribes about climate, that they had engaged more fully in the amendments which we have put forward in good faith.

1:20 pm

Photo of Kay HullKay Hull (Riverina, National Party) Share this | | Hansard source

It would be interesting to do a tally of Hansard to see how many times abuse has been hurled across the chamber at the Nationals for their policy beliefs and their principles. It sometimes confounds me, but I think it is because the Nationals and their views may be resonating in the heads of opposition members. Maybe they feel a prick of guilt that they are not espousing the same views or maybe it is that they are not game to espouse similar views. It never ceases to amaze me how Labor members come into this chamber to make derogatory remarks about the Nationals. It has been no different in this debate. I could certainly be accused today of trading a few insulting words of my own.

Make no mistake about it, our regional social fabric as we know it today will be forever changed by the intentions of this bill, the Carbon Pollution Reduction Scheme Bill 2009 [No. 2], and related bills. This legislation will allow the CPRS contained in the bill to white-ant our economy. In fact, the bill before us bears a great resemblance to a nest of white ants. It will eat through the centre of susceptible structures and leave nothing but a thin veneer of what was once a functional, thriving and prosperous economy, with the spoils being enjoyed by the bankers, the traders and the world polluters who will enjoy our wealth transfer. In fact, when you think about white ants, you are drawn to thinking about the structure of a white ants’ nest which, oddly, resembles the structure of the Labor government in the debate on this bill: you have a king and queen and a host of wingless and blind worker ants who inflict enormous damage in a highly secretive manner. This is clearly what is happening here. This bill is highly secretive. It may as well have been written in cryptic code, because the effect has been very similar. One almost needs a decoder to understand the make-up of this bill, and it is obvious from listening to the many speakers in this House that even Labor members were not told how to crack the code so that they could understand it either.

This bill is designed to be complicated so that it enables this Labor government to commit a fraud on every Australian. Labor members of parliament are blindly following their leader in this wilful destruction. Perhaps I need to correct a little of that statement: I think some Labor members are following, but they are not blinded to the effect of this bill and of Prime Minister Kevin Rudd’s ETS, including his CPRS. We know who they are because, behind the closed doors and in whispers, they tell us of their concerns. But they obviously cannot raise their concerns within the Labor caucus for fear of being disendorsed and becoming another victim of this CPRS.

I say this bill attacks all Australians, and I make no apology for asserting that in this House. I was part of the process of implementing the GST. In the lead-up to the 1998 election it was well known by communities and voters that a GST would be imposed. I was running for election in that year and had to withstand the onslaught of angst about the introduction of a GST. And between my election in 1998 and 2000 it was extraordinary that I had to be in every shopping centre with a full shopping list of every single item on the shelves. That was what was being demanded of us as government members by Labor Party members. Members of Labor branches throughout our electorates demanded that we were able to tell every price of every single item that was on a grocery shelf, what tax it had on it at that time and what it would be after the introduction of the GST. There were copious amounts of information out there. There were so many fact sheets we could provide to the consumers to explain that tax to them. That was demanded, yet we have seen none of that associated with this bill.

This bill is none other than a secretive and deceptive new tax, and that is the truth. It must be recognised that this bill is a tax. The Nationals have been laughed at for saying that. There has been some sniggering occasionally here today, but I note that the Nationals have continually been laughed at and ridiculed in the House and in the public arena by Labor members and senators for raising this point. If you listened to those Labor members during their speeches you would think the Nationals are the only people living who have this view. Well, I decided that in my speech today I would quote from a few people who have a similar view to us. They actually are in the media. They are finally coming forward, so it is not only the Nationals who have this view. I will quote from an article in the Weekend Australian of 17 and 18 October 2009, just one week ago, by Terry McCrann. I want to quote this article because he talks about the tax that I have raised here. Terry McCrann says:

IMAGINE if John Howard and Peter Costello had proposed a GST with an indeterminate variable rate, with the “variation” left hostage to the manipulation of clever investment bankers and other main-chancers, and you might begin to understand “Kevin Rudd’s GST”—his Emissions Trading Scheme, or ETS.

“His GST?” If we get the ETS, it is going to add to the price of everything—not just power and not just carbon-based power in particular. On that point, it’s worth noting that it is specifically designed to increase the price of all power—quite deliberately, to make wind and solar power “competitive”. That’s to say we pay more for them, but they become “cheaper” than coal-based power.

Indeed, the ETS is intended to be, and will be, even more punitively pervasive than the GST. Because once we get past the early, politically driven, subsidies to hide its real impact and real cost, there will be no carve-outs, as is the case with the GST and fresh food and medical services. They will all become more expensive.

The pervasiveness and very significant impact on your everyday costs makes Rudd’s ETS the elephant in every living room. What will turn it into a dangerous, unpredictable rogue is the way it becomes hostage to market manipulation.

To return to the—real—GST, imagine if Howard and Costello had said we are going to have this tax on (almost) everything. Right, at what rate, would properly be the immediate response?

Sorry, we can’t tell you that—the rate will be left to the market. But we can guarantee it will be 10 per cent for the first year—after that you’re on your own. Sorry, what we meant to say, was that after that the market will determine it in its usual at the fair and efficient way.

The author goes on to say:

Yet that is exactly what’s proposed with Rudd’s ETS. That it comes with a “variable rate”. Worse, not simply “variable” by politicians—who, sure, I don’t trust but are at least accountable and punishable. But “variable” and by “the market”. And not just the market in some broad, not too threatening, way, but clever speculators and manipulators.

In fact, he goes on to say:

Don’t believe me? I quote from the last budget papers: “The government will commence the scheme on 1 July 2011, with a fixed carbon price of $10 during 2011-12, and the carbon price determined by the market from 1 July, 2012.”

Now, in the first year, the budget estimates that the ETS—officially called, as Rudd’s “Big Lie”, the Carbon Pollution Reduction Scheme—will raise $1.9 billion cash at that $10. Again, as everything to do with this is a cacophony of liars, small as well as big, the ETS/CPRS is not a price on carbon but on carbon dioxide.

He goes on:

Year two is where it gets interesting. The budget estimates that when “the market” takes over, the ETS take will leap to $11.5bn on a cash basis and just shy of $13bn on an accrual basis.

In that 2012-13 year—the last “outest” year of budget estimates—the GST itself is estimated to raise just under $50bn on a cash basis and just under $52bn on an accrual basis.

Any accounting way you carve the numbers, the ETS is equivalent to a 25 per cent increase in the GST … In the first fully operational year …

I could go on further but I make my point: this is a tax. What will we be seeing? Will we be seeing a difference in world emissions? No, we will not. There will be huge differences for Australians because they will be taxed heavily so that countries such as India, China and others can emit more and Australians’ hard-earned wealth can be distributed across the world.

There will be laughter from across the chamber, I am sure, at these words. But, believe me, we are entering dangerous waters. Who will be the banker? I believe that we will have the world’s biggest cartel. It will be more powerful than anything we have seen before. I was so pleased to see another journalist doing some research on this issue of who will be the banker. Janet Albrechtsen has done what other journalists were too lazy to do, or maybe they were too intimidated. On 28 October 2009, in an article in the Australian entitled ‘Beware the UN’s Copenhagen Plot’, the journalist demonstrated enormous bravery in raising the lack of detail on the Copenhagen meeting, and her work on the draft treaty is absolutely commendable. She has covered the intentions to control the once-free markets—namely, the financial and trading markets. The journalist explains more comprehensively what I call ‘the cartel’ within her article. She starts by saying:

SHAME on us all: on us in the media and on our politicians. Despite thousands of news reports, interviews, analyses, critiques and commentaries from journalists, what has the inquiring, intellectually sceptical media told us about the potential details of a Copenhagen treaty? And despite countless speeches, addresses, interviews, doorstops, moralising sermons from government ministers, pleas from Canberra for an outcome at Copenhagen, opposition criticism of government policy, what have our elected representatives told us about the potential details of a Copenhagen treaty?

I think Senator Barnaby Joyce and the Nationals have been trying to raise this issue loudly and clearly for a long time. After her research into the draft treaty she really started to question it and says:

Clause after complicated clause sets out the requirement that developed countries such as Australia pay their “adaptation debt” to developing countries. Clause 33 on page 39 says that by 2020 the scale of financial flows to support adaptation in developing countries must be at least $US67 billion ($73bn), or in the range of $US70bn to $US140bn a year.

How developed countries will pay is far from clear. The draft text sets out various alternatives, including Option 7 on page 135, which provides for “a (global) levy of 2 per cent on international financial market (monetary) transactions to Annex I Parties”. This means industrialised countries such as Australia, if we sign.

The journalist goes on to say:

Ask yourself this: why has our government failed to explain the possible text of a treaty it wants Australia to sign? There has been no address from any Rudd minister to explain the draft treaty. No 3000-word essay from the thoughtful PM. No speech in parliament. No interview. No press release. Nothing.

Presumably the hard-working Climate Change Minister Penny Wong has read the 181-page draft text. Presumably our central control and command PM has been briefed about the draft text. In Germany a few months ago, Kevin Rudd complained about the lack of “detailed programmatic specificity” going into the Copenhagen talks. Yet the draft text provides much detailed specificity about obligations on developed nations to transfer millions of dollars to developing countries under formulas to be set down by an unelected body. So why the silence? Are they hiding the details of this deal from us because most of the polls now suggest that action on climate change is becoming politically unpalatable?

And what explains the media’s failure to report and analyse the only source document that offers any idea of what may happen in Copenhagen? Ignorance? Laziness? Stubborn adherence to the orthodox government line that a deal in Copenhagen is critical? An obsession with the politics of climate change rather than policy?

Labor members may choose to remain blind. They may speak of embracing science. I ask: what version of science should be embraced? There was a London Times article in the Australian dated 27 October 2009, which I will not have time to read. It dictated an extreme position that has evolved from the so-called science that Labor members are adhering to. The article quotes Lord Stern and says, ‘People will need to turn vegetarian if the world is to conquer climate change, according to a leading authority on global warming.’ It talks about methane from cows and pigs and the fact that we all have to become vegetarians. The article goes on to say of Lord Stern:

He predicted that people’s attitudes would evolve until meat eating became unacceptable.

                  …              …              …

He said that he was deeply concerned that popular opinion had so far failed to grasp the scale of the changes needed to address climate change, or of the importance of the UN meeting in Copenhagen from December 7 to December 18.

“I am not sure that people fully understand what we are talking about or the kind of changes that will necessary,’ he added.

I can tell you that people do not fully understand.

The Nationals have agreed to negotiations on this bill, for if this bill is to go through the Senate to be implemented then it most certainly should be given the chance to be improved. However, I stand behind the Nationals’ view and emphatically behind the Nationals’ position. You cannot make a silk purse out of a sow’s ear. This legislation should be thrown out. It is failed and flawed, to use the words of the Prime Minister in an explanation of something that had gone wrong in his life in the past. I have tried to engage in this debate in a realist way and have even produced my own booklet, Carbon Conversation, and distributed it to everybody in my electorate with what I felt were balanced facts on what science tells us on the issues of carbon and so-called climate change. Even though I have held these forums, put this booklet out and tried to have a sensible, balanced view on this, I have been absolutely glued to the fact that this legislation should never be passed. It is not in the best interests of Australian agriculture and Australian regions, and certainly not in the interests of any Australian person.

1:39 pm

Photo of Kevin AndrewsKevin Andrews (Menzies, Liberal Party) Share this | | Hansard source

Let me pose a very simple question about Labor’s ETS, as it is outlined in the Carbon Pollution Reduction Scheme Bill 2009 [No. 2]. By how much will the price of this carton of milk increase once the ETS is introduced? Or another question: by how much will the price of this loaf of bread increase once Labor’s ETS is introduced? Let me give you the simple answer: nobody knows. The minister does not know. The government does not know. Indeed, I challenge them to come in here before the end of this debate and say what the increase in price will be for an ordinary, everyday staple—namely, a carton of milk—because of the ETS.

Let us take that carton of milk. It is estimated that the ETS will amount to a tax on every cow in Australia, because of emissions, of up to $75. That is a tax on the farming sector of this country of $2 billion a year. This will be reflected in prices. The respected financial commentator Terry McCrann estimates that the ETS is equivalent to initially raising the GST to 12½ per cent. But he warns:

… there is no … cap on this insidious version of a GST. The effective rate could double or triple, the amount of money raised could skyrocket. Indeed, it is intended to do exactly that, with no referral back to parliament for endorsement.

A brief to the Victorian Treasurer estimates that electricity costs in Victoria will increase between 26 and 46 per cent as a result of this ETS. And this increase in electricity costs will cascade through the entire economy, affecting almost everything that is produced. Indeed, the Rudd government has refused to release another report about the hike in electricity costs because of this legislation. The ETS is a massive tax hike that will be paid for by all Australians.

So a carton of milk will increase in price because of the tax on farming. It will increase in price because of the tax on electricity. It will increase in price because of the tax on transport. Simply having a dairy cow will be taxed. Using machinery to milk the cow will involve further tax. Refrigerating the milk will involve further tax because of the electricity it uses. Transporting the milk from the farm to the factory will involve further tax. The manufacture of milk products at the factory will involve further tax. The distribution of those products, whether it be the carton of milk or any other milk product, will involve further tax. And the government cannot tell us how much something simple that Australians buy everyday, such as a carton of milk, will increase in cost. Yet the estimates are that in the first year this will be like increasing the GST to 12½ per cent. I remind you that there is not a tax on many food products at the present time, but there will be under this new tax.

Worse than that, the ETS will destroy much of our competitive advantage as a nation. It is worthwhile remembering some sobering statistics about China, whose economy will not be subject to an ETS type tax. China’s reliance on coal as a primary source of energy is reflected in the fact that coal makes up 69 per cent of China’s total primary energy consumption. China has an average of two new coal fired power stations opening every week, with another 500 under construction. In 2007, China edged ahead of the United States as the world’s leading emitter of greenhouse pollution. If unabated by 2030, China’s emissions will grow by 139 per cent and make up 26 per cent, more than a quarter, of the world’s total emissions output. And China claims that it will be a developing country for at least the next 50 years and therefore will not agree to be subject to the Kyoto protocol.

Indeed, just last week India and China signed an agreement in New Delhi to collaborate on the development of renewable power projects and improved energy efficiency programs while rejecting any outside mandates that would slow the growth of both those nations. In other words, two of the world’s leading emitters have already said no to the Copenhagen proposals. So why on earth should Australia impose upon itself a job-and economy-destroying ETS when developing countries such as China will continue to grow and to pollute unabated?

None of this has been explained by Mr Rudd. Instead, he insists that Australia enact his job-destroying, high-taxing legislation before the rest of the world. He cannot even wait until December when the nations of the world meet in Copenhagen to discuss climate change. In July, the coalition issued nine principles about an ETS. In addition, we have repeatedly stressed that there should be no Australian legislation before the Copenhagen climate change conference, due as I said in less than two months time in December. In simple language: no legislation before Copenhagen and, relative to the rest of the world, no detriment to Australian industry and no loss of Australian jobs.

The Copenhagen conference, as I said, begins on 7 December, less than two months away. The US congress will not have enacted legislation before Copenhagen and neither will any major emitting nation. Despite this, Mr Rudd insists that Australia, with less than two per cent of the world’s emissions, legislates beforehand. Worse, the draft Copenhagen agreement envisions a massive transfer of moneys from countries like Australia to others. It envisages an international government of this new system. None of this has been discussed with the Australian people. And Mr Rudd cannot even tell us what the real cost to ordinary Australians will be on their ordinary everyday purchases and on their lives.

The reality is that Labor’s proposals will be a tax on everything. It will cascade through the tax system, adding a massive cost to business in this country and hence goods and services throughout Australia. It will make the GST look like a minor imposition by comparison. Mr Rudd’s tax on everything will cost us dearly. At the very least, we should not be enacting this legislation until after Copenhagen. When the Australian people realise the con that Mr Rudd is engaged in, their views will harden against this proposal. As I said, I challenge the minister before the end of this debate to tell the Australian people just how much this carton of milk will increase by because of his ETS.

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

The member knows that props, while sometimes assisting and tolerated, are not encouraged. He got good value from his milk carton.

1:47 pm

Photo of Christopher PyneChristopher Pyne (Sturt, Liberal Party, Shadow Minister for Education, Apprenticeships and Training) Share this | | Hansard source

I move:

That the question be now put.

Question put:

1:59 pm

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

Kevin Rudd said something very clearly to the people of Dawson in this headline: ‘How I’ll save the mining industry.’ Here it is in the Daily Mercury on 25 July. Through the Carbon Pollution Reduction Scheme we are going to cut emissions and we are going to save jobs. The Labor Party is the miners’ friend—always has been, always will be.

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

Order! It being 2.00 pm, the debate is interrupted in accordance with standing order 97. The debate may be resumed at a later hour and the member for Dawson will have leave to continue speaking when the debate is resumed.