Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

Before the debate is resumed on this bill, I remind the House that it has been agreed that a general debate be allowed covering this bill, the Carbon Credits (Consequential Amendments) Bill 2011 and the Australian National Registry of Emissions Units Bill 2011.

Debate resumed on the motion:

That this bill be now read a second time.

to which the following amendment was moved:

That all words after “That” be omitted with a view to substituting the following words: “the House decline to give the bill a second reading until the terms of the regulations giving effect to the provisions of the bill are laid before the House.”

Nola Marino (Forrest, Liberal Party) Share this | Link to this | Hansard source

As I was saying earlier today, the example of blue gum plantations throughout southern Australia taking up volumes of groundwater and driving down water tables serves as a warning to all of us. The cumulative impacts of plantations on the environment, agriculture, current and future food production must be considered. These include water usage and fire management issues.

The second form of biosequestration covered in this bill is soil carbon. There are an estimated 2,700 billion tonnes of carbon in the world's soils, most of it in the top 30 centimetres. This compares with the 800 billion tonnes in the world's atmosphere and the 900 billion stored in biomass, which of course includes trees. Australian soils vary in natural organic carbon levels from one to five per cent, with more than 75 per cent of Australian farming soils having organic carbon content of less than 1.75 per cent. Much of my home state of Western Australia has sandy soils, which sit at the one to two per cent carbon level. We should also note that soil carbon levels in Australia have declined 10 to 60 per cent over the last 80 years. This alone tells us that we have an opportunity to put a lot of carbon into our soils, which certainly will give us healthier and more productive soil.

Land use plays a significant role in the soil carbon cycle, and good management can raise levels above the natural average. However, members should be warned against assuming that only trees can raise soil carbon levels. Pastures are an important tool, because organic matter concentrations tend to be much higher under grass, with recorded levels of up to seven per cent of soil carbon under well managed pastures.

Observations of the world's ecosystems show that organic carbon concentrations in soils, to a depth of one metre, under various land uses were: 122.7 tonnes per hectare for tropical forests, 117.3 tonnes for tropical savannas, 96.2 tonnes for temperate forests, 80 tonnes for croplands and 236 tonnes for temperate grasslands. By this we can see that well-managed pastures that are not overgrazed can add significantly to soil carbon levels. The rewards are high, and Australia would be greatly advantaged if we were able to raise our soil carbon by even one per cent across the nation.

However, the use of soil carbon as a mitigating offset is made difficult by the lack of certainty around the measurement of soil carbon and its permanency. Soil carbon is increased by the addition of carbon such as vegetation or biochar or by the reduction of carbon use or loss. In the natural cycle, soil carbon rises as a result of all the living, dead and decomposing plants, animals and microbes in the soil, along with organic residues and humic substances that they release. The classic example is the floor litter of forests, which breaks down and is absorbed into the soil structure. We must remember though the great importance of the smallest player, the micro-organisms. Soil health and its ability to hold onto and use carbon are directly related to the microbial balance of soil. This balance is something we know far too little about, although we do know how important it is. It is, however, difficult to measure in the short term how much added carbon has been absorbed into the soil structure and how long it will remain there. This makes this form of biosequestration difficult to measure and cost.

There are a number of issues the government must address in the development of carbon farming and the market that would go with it. The shadow minister has clearly articulated many of these; however, as a farmer, there are a number of issues that I would like to see addressed. We certainly need to know who owns the land on which carbon farming is occurring and will occur; how much land is involved; where that land is located; and, more importantly, who owns the credit for the carbon that will be stored there. I would like to see a publicly available national carbon farming register so that the process is an open and accountable one. This should include programs of carbon farming owned by foreign entities on Australian soil. This is important because, given that Australian farmers currently manage 61 per cent of Australia's landmass, in my view Australian landowners should be the principal beneficiaries of carbon farming activities here. Under the coalition's direct action proposal, farmers will be able to tender for carbon sequestration. We need to avoid the situation where our landholders are locked out of potential overseas markets that might be available to foreign entities.

The parliament should also consider the intellectual property rights of carbon technology. I have absolutely no doubt that Australian farmers can lead the way, given the opportunity. Even though cropping would appear to be poorly suited to carbon storage, Australian work indicates that good cropping management can be used to minimise soil carbon loss. According to the CSIRO, improved management of crop land—be it enhanced rotation, adoption of no-till, which we have seen a lot of in Western Australia, or stubble retention—has resulted in better retention of carbon in soils. This type of technology, developed in Australia, should be exported around the world once adequate IP protocols have been put in place.

The complexity of measuring and attributing carbon storage is the most difficult issue facing carbon farming. The Kyoto protocol's rules have always been slanted to assist nations that are geographically small but have a large population, and to this end the rules have failed to recognise the need to manage carbon sinks rather than just to observe them. An Australian system of carbon farming will need to be simple and effective and to relate directly to our specific set of parameters and common practice. The last thing we want to do is generate a layer of carbon bureaucracy and perhaps have an explosion of carbon middlemen to give another blank cheque to or have another scheme mismanaged by this government. Carbon farming should be an opportunity for landholders to enter a new marketplace, not just an opportunity for carbon agents. How the regulations manage this process will be critical, and we have not seen that yet.

The impact of this bill on the agricultural landscape of Australia is also of paramount importance. Pricing carbon provides an incentive to shift from food to carbon production. On some areas of marginal land this is not automatically a negative, but food production is critically important in a world in which the human population will rise from 7 billion to over 9 billion—recently I heard some information at a conference that Australian farmers by default feed 60 million people in the world now—especially here in Australia, where our food producers and their viability are constantly undermined by supermarkets and, unfortunately, by some of the decisions that have been made by this government.

How we ensure that our food-producing farmers maintain commercial and viable returns is a real issue for us in this nation. Australia's, and global, interests are not best served if our farmers stop producing food here in Australia. I acknowledge, as you would, Mr Deputy Speaker, that our farmers in Australia are some of the most efficient producers in the world. They produce some of the best quality food and fibre that the world sees, which is not something that is necessarily recognised or valued in the way that it should be. I hear the members at the table, who are perhaps discussing this issue. I hope they are, because we do produce some of the best food and fibre in the world. The choice to keep producing food must be available, and the rewards for doing so should go to those producing that food and fibre.

I am very concerned about the practical matters in this legislation and, unfortunately, I am concerned that putting this government in charge of anything to do with farmers and growers is probably a bit like letting the fox into the hen house, which is something that we understand very well. The practical nature of farmers means that we will need some very good ways for them to tender for and be engaged in the soil carbon market, as they could through the coalition's process. I will be very interested to see the findings of the Senate report and to see how the range of issues that I and so many others have raised in this respect are dealt with.

Craig Thomson (Dobell, Australian Labor Party) Share this | Link to this | Hansard source

It is always good to follow the member for Forrest. What she was saying in relation to the contribution of Australian farmers to the global food bowl was interesting. It is a very important issue and it is always worth putting on record the outstanding work and innovation that our farmers bring to their craft. However, it would also have been good if the member for Forrest had spent some time at the climate change commission summit the other day, because, while she may be quite good at telling us some of the facts and figures about the farming sector, she is clearly, like her party, lost and in the wilderness in relation to climate change. That is one of the reasons that I am so supportive of these bills and the legislation before the House today, and I will spend a little time talking about why and how important it is.

The Carbon Credits (Carbon Farming Initiative) Bill 2011 fulfils the Australian government's commitment to develop legislation to give farmers, forest growers and landholders access to domestic, voluntary and international carbon markets. This will begin to unlock the abatement opportunities in the land sector, which currently make up 23 per cent of Australia's emissions. The first objective is to help Australia meet its international obligations under the United Nations conventions on climate change and the Kyoto protocol to reduce its emissions of greenhouse gases. We know that those on the other side have all sorts of difficulties with the Kyoto protocol and continue now to struggle on a daily basis with their position on climate change.

The second objective is to create incentives for people to undertake land sector abatement projects. The ability to generate saleable carbon credits provides an investment incentive, thereby helping to channel carbon finance into the land sector abatement. A further objective is to achieve carbon abatement in a manner consistent with protection of Australia's natural environment and to improve resilience to the impacts of climate change. This recognises the important contribution that this scheme can make towards environmental objects such as improving water quality, reducing salinity and erosion, protecting and promoting biodiversity, regenerating landscapes and improving the productivity of agricultural soils.

The Australian National Registry of Emissions Units Bill 2011 establishes a national registry. The registry serves two primary purposes: to be Australia's first national registry for Kyoto units, which is required under the Kyoto protocol, and to act as a registry for Australian carbon credit units under the Carbon Farming Initiative. Accordingly, this bill is necessary to support carbon farming initiatives and to allow people to trade credits. The third bill is the Carbon Credits (Consequential Amendments) Bill, which has a range of amendments to legislation, and I will not spend much time talking about that.

There are timing sensitivities with these bills. We have previously committed to having legislation passed by 1 July 2011 to provide certainty to farmers, forest growers and landholders, who have previously invested in abatement projects or are looking to invest in the near future. In particular, there are a number of projects which were previously supported by the Greenhouse Friendly program, which concluded on 30 June 2010. These included forest sequestration projects and landfill waste projects. The failure to pass the Carbon Pollution Reduction Scheme significantly impacted the investment in these types of projects. There is already a domestic voluntary market for carbon neutral products and services with which these credits will sell into—for example, when Qantas offers to offset flight emissions. At the moment, there are no domestic credits for Australian companies to buy until this bill is passed. The bill allows for a backdating of credits to 1 July 2010 to accommodate projects previously in the Greenhouse Friendly program, where these projects meet the new standards and have properly measured the abatement.

The legislation will establish an important funding stream for regional and rural Australia. The legislation is a voluntary mechanism. No-one has to be part of the scheme if they choose not to be. If they do take part, they can gain credit for their action to reduce or store carbon pollution. The size of the voluntary market will initially be quite small, but significant revenue would be available if internationally compliant credits are used in the carbon price mechanism. This matter, of course, is being discussed in the Multi-Party Climate Change Committee.

Tony Abbott's so-called direct action policy relies excessively on storing carbon in soils and does nothing to move the economy to a clean energy future. Other countries are already taking action on climate change and the economic competitiveness of some of Australia's companies could be disadvantaged if we do not take action at home.

The Gillard government is committed to introducing a price on carbon. It is the right thing to do for jobs, for our economy and for the environment. A carbon price is the cheapest and the fairest way to cut pollution and drive investment in a clean energy future. Just this week, the Climate Commission report made clear that the next 10 years requires critical policy decisions by putting a price on carbon if we are to stabilise carbon pollution and avoid dangerous levels of global warming in the future.

It is worth talking about my electorate because it is one of those electorates that is being dramatically affected by climate change. At north Entrance, we have massive erosion of the beach. Backyards of houses have been washed away and continue to be washed away. The local council has a program to continually dredge sand and put it back in place. But the effects of climate change with more frequent storm surges and changing sea levels have meant that that community is in some danger and continues to be in some danger.

In the north of my electorate at Cabbage Tree Bay at Norah Head, houses are falling into the ocean. The council is having to buy back those houses because we have not acted in relation to climate change. It is too late for those areas already in terms of what is happening there, but it is not too late to act to save the planet. And we need to be doing that, and that was made absolutely clear just the other day with the Climate Commission's report.

We have an opposition who are putting their heads in the sand on climate change issues. If they put their heads in the sand in my electorate, they will get washed away. Quite frankly, they are going to get washed away in the debate on climate change because there is an overwhelming view out there that we need to act to make sure that the environment is protected. Even those opposite do not actually believe the position that their leader is putting. There are many on the other side who know that climate change is real, that climate change is induced and made worse by man and that we need to act and we need to act now. That is one of the reasons that I am so supportive of these bills and the legislation before the House today, and I will spend a little time talking about why and how important it is.

The Carbon Credits (Carbon Farming Initiative) Bill 2011 fulfils the Australian government's commitment to develop legislation to give farmers, forest growers and landholders access to domestic, voluntary and international carbon markets. This will begin to unlock the abatement opportunities in the land sector, which currently make up 23 per cent of Australia's emissions. The first objective is to help Australia meet its international obligations under the United Nations conventions on climate change and the Kyoto protocol to reduce its emissions of greenhouse gases. We know that those on the other side have all sorts of difficulties with the Kyoto protocol and continue now to struggle on a daily basis with their position on climate change.

The second objective is to create incentives for people to undertake land sector abatement projects. The ability to generate saleable carbon credits provides an investment incentive, thereby helping to channel carbon finance into the land sector abatement. A further objective is to achieve carbon abatement in a manner consistent with protection of Australia's natural environment and to improve resilience to the impacts of climate change. This recognises the important contribution that this scheme can make towards environmental objects such as improving water quality, reducing salinity and erosion, protecting and promoting biodiversity, regenerating landscapes and improving the productivity of agricultural soils.

The Australian National Registry of Emissions Units Bill 2011 establishes a national registry. The registry serves two primary purposes: to be Australia's first national registry for Kyoto units, which is required under the Kyoto protocol, and to act as a registry for Australian carbon credit units under the Carbon Farming Initiative. Accordingly, this bill is necessary to support carbon farming initiatives and to allow people to trade credits. The third bill is the Carbon Credits (Consequential Amendments) Bill, which has a range of amendments to legislation, and I will not spend much time talking about that.

There are timing sensitivities with these bills. We have previously committed to having legislation passed by 1 July 2011 to provide certainty to farmers, forest growers and landholders, who have previously invested in abatement projects or are looking to invest in the near future. In particular, there are a number of projects which were previously supported by the Greenhouse Friendly program, which concluded on 30 June 2010. These included forest sequestration projects and landfill waste projects. The failure to pass the Carbon Pollution Reduction Scheme significantly impacted the investment in these types of projects. There is already a domestic voluntary market for carbon neutral products and services with which these credits will sell into—for example, when Qantas offers to offset flight emissions. At the moment, there are no domestic credits for Australian companies to buy until this bill is passed. The bill allows for a backdating of credits to 1 July 2010 to accommodate projects previously in the Greenhouse Friendly program, where these projects meet the new standards and have properly measured the abatement.

The legislation will establish an important funding stream for regional and rural Australia. The legislation is a voluntary mechanism. No-one has to be part of the scheme if they choose not to be. If they do take part, they can gain credit for their action to reduce or store carbon pollution. The size of the voluntary market will initially be quite small, but significant revenue would be available if internationally compliant credits are used in the carbon price mechanism. This matter, of course, is being discussed in the Multi-Party Climate Change Committee.

Tony Abbott's so-called direct action policy relies excessively on storing carbon in soils and does nothing to move the economy to a clean energy future. Other countries are already taking action on climate change and the economic competitiveness of some of Australia's companies could be disadvantaged if we do not take action at home.

The Gillard government is committed to introducing a price on carbon. It is the right thing to do for jobs, for our economy and for the environment. A carbon price is the cheapest and the fairest way to cut pollution and drive investment in a clean energy future. Just this week, the Climate Commission report made clear that the next 10 years requires critical policy decisions by putting a price on carbon if we are to stabilise carbon pollution and avoid dangerous levels of global warming in the future.

It is worth talking about my electorate because it is one of those electorates that is being dramatically affected by climate change. At north Entrance, we have massive erosion of the beach. Backyards of houses have been washed away and continue to be washed away. The local council has a program to continually dredge sand and put it back in place. But the effects of climate change with more frequent storm surges and changing sea levels have meant that that community is in some danger and continues to be in some danger.

In the north of my electorate at Cabbage Tree Bay at Norah Head, houses are falling into the ocean. The council is having to buy back those houses because we have not acted in relation to climate change. It is too late for those areas already in terms of what is happening there, but it is not too late to act to save the planet. And we need to be doing that, and that was made absolutely clear just the other day with the Climate Commission's report.

We have an opposition who are putting their heads in the sand on climate change issues. If they put their heads in the sand in my electorate, they will get washed away. Quite frankly, they are going to get washed away in the debate on climate change because there is an overwhelming view out there that we need to act to make sure that the environment is protected. Even those opposite do not actually believe the position that their leader is putting. There are many on the other side who know that climate change is real, that climate change is induced and made worse by man and that we need to act and we need to act now. Also, incentives for carbon farming are earned through abatement of greenhouse gases by capturing and destroying of methane emissions from landfill or livestock manure. I find that one pretty interesting because, as we know, animals eat and then excrete, and there is not much we can do to stop them doing that, not much at all. So we remove carbon dioxide from the atmosphere and store it in soil or trees by growing a forest. I have many farmers in my electorate and I want to assure and advise those farmers that a carbon fanning scheme will not have adverse effects on their practices.

The coalition cannot vote in parliament on this legislation because the Labor government wants us to vote without seeing the detail and we will not do that, The coalition is awaiting a Senate report. We await with interest views on the following matters: one, prime agricultural land protection; two, protection for Western Australia from effective expropriation of crown land usage rights by the bill; three, completion of the key regulations; four, inclusion of soil carbon from the outset; five, the risk of rorting, as in Europe, without adequate protections, as reported on the front page of the Australian, 19 May 2011; six, construction of an acceptable set of rules around the permanence; seven, construction of an acceptable set of rules around additionality; and, eight, other amendments to be identified by the Senate Environment and Communications Legislation Committee report on the bills to report on Friday, 27 May 2011.

We need simple answers to questions such as: what happens if forest on your farm is destroyed by bush fire? Are you penalised? Do you have to pay those credits back? That is a worry for many farmers—that if they get a credit somehow they might have to pay it back in years to come when their forest is destroyed by fire. In fact, those credits might be costing a lot more by then. So that is a concern.

I spoke in this place on 29 October 2009 about the ETS in Europe and their ETS statistics at the time. They were dismal—the results spoke for themselves and now we see rorting also. This is why it is so important that the government provides the detail and why the coalition supports the principle but has serious concerns about the legislation. We are not prepared to give a blank cheque.

This legislation does not contain the opportunities for carbon farming as outlined in our direct action plan. Under the direct action plan the coalition will reduce carbon dioxide emissions through biosequestration in general and, in particular, the replenishment of our soil carbons. Farmers will be entitled to tender for additions in soil carbon.

The Gillard government's approach to the carbon farming offsets bill will be completely skewed by a carbon tax and ETS, leading to the wholesale conversion of prime farming land from agriculture to trees. We simply do not know what we are dealing with here. It is an unknown quantity. For that reason, the opposition will be moving an amendment in the House, declining to give the bill a second reading until the regulations giving effect to the provisions of the bill are laid before the House. The coalition will reserve its position on other matters until the Senate inquiry report is handed down on Friday 27 May 2011. That is not very long to wait. Why can the government not wait until we get some of those answers?

Further amendments will be considered following the Senate inquiry report. Ultimate support for this bill in the Senate will depend upon a satisfactory resolution on the range of amendments to be presented. Without the regulations and the amendments we would not consider the legislation to be anywhere near ready.

Based on the facts we have—which are not a lot—it would be careless for the coalition to let this legislation continue in its current form. As a member of parliament, I have to look out for my constituents. Many are farmers who will be affected by this legislation. I hope it is a positive effect but we simply do not know. The consultation process for the exposure draft of the legislation was only in capital cities, which are not always easy for farmers to access—there are no farmers in the city. I refuse to give Labor and the Greens the opportunity to decide the future of farmers in my electorate and all over Australia.

At Senate estimates, officials confirmed there is not yet a definition of 'common practice' for farming. There needs to be an education program to teach farmers the implications of signing up for such a scheme. Major Studies by ABARE and CSIRO which would provide invaluable information on the carbon farming initiative will not be released till after the carbon farming initiative is voted on. Why wait? We should have that information now. This is so typical of this government. It is back to front logic, putting the cart before the horse; it just does not make sense.

The coalition supports biosequestration—capturing carbon emissions in soils, trees and other biological matter. It is a key part of the coalition's direct action climate policy. A report issued this year by the CSIRO, 'Greenhouse gas mitigation: sources and sinks in agriculture and forestry', by the head of the Sustainable Agriculture Flagship, Michael Battaglia, pointed to the great potential for biosequestration in reducing greenhouse gas emissions. The report found that 'we can potentially increase these stores in our rural lands and perhaps store or mitigate enough greenhouse gases to offset up to 20 per cent or more of Australia's emissions during the next 40 years.' The carbon farming initiative legislation risks dire consequences for the farming sector and will have major implications for our nation's food security.

A major concern we have is that while tree planting can be good—and it has a place under our direct action plan—there must be appropriate controls to ensure large tracts of good food-producing land are not lost to trees. Labor's plan will cause the wholesale transfer of food production land to trees in Australia's best farming areas, trees which cannot be harvested in any form. A leaked CSIRO report featured in the Sydney Morning Herald claims a carbon price of $36 dollars a tonne would likely see the whole lower Murray-Darling Basin converted to trees, starting at a carbon price as low as $11 a tonne. This is much worse than commercial forestry as there will be no employment required after the trees are planted and the flow-on impacts of job losses in the community will be large.

The Murray-Darling Basin produces 39 per cent of Australia's agricultural production. It also contains 65 per cent of the irrigated land and 40 per cent of the farms. Even if you only halve that, you reduce Australia's food production by 20 per cent. Does the government want to see Australia turn into a country that imports all its food? That is what will happen if Labor threatens our food security with this legislation. Australia is a big country and there is plenty of scope to plant trees in marginal country where farming is less viable and where there are environmental co-benefits in relation to salinity, erosion, woody weeds, biodiversity, bird life and so on. I question Labor's consultation process if they believe it is a good idea to plant trees on Australia's prime food production land. This is just another example of why the coalition needs to see more detail. We will not and cannot support initiatives that damage food security and cause job losses.

A concern for farmers is the duration of abatements in this legislation. The 100-year life of credits gives rise to problems when carbon stores are prematurely disturbed by no-fault or natural events but proponents are required to re-establish or regenerate carbon stores, or relinquish carbon credits. Over a 100-year life cycle, it is highly probable that carbon stores will be affected by an event, such as a bushfire, which releases the carbon store, leaving the proponent liable. It is ridiculous to lock farmers in for 100 years; so much can change in that time. Farmers should be concerned about this government and its legislation. Labor is certainly out of touch.

Labor and the Greens are in conflict over the starting price of their carbon tax. The Greens have called for a carbon price in excess of $40 a tonne. The government commissioned report from Deloitte has found that an emissions tax of $40 per tonne would be needed to encourage a national transition from coal-fired electricity to gas. Not that long ago, on 18 May, Senator Sarah Hanson-Young from the Greens said the carbon tax may need to reach $100 a tonne to make renewable energy competitive.

Our direct action climate change policy will reduce emissions in a way that is economically responsible and it will not cost Australian jobs. The coalition's direct action plan will reduce emissions by 5 per cent by 2020 through creating a fund to buy back greenhouse emissions, more tree planting, better soils and smarter technology. We want the detail and, if the government has nothing to hide, why would they deny the House the ability to examine the regulations so that we in opposition can make up our minds fully informed?

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

For those who are listening to parliament, it is always important to look at what the coalition actually do on climate change issues relating to the farming and regional areas of our country, not what they say they do. We have heard, in this debate on the Carbon Credits (Carbon Farming Initiative) Bill 2011 and related bills, the member for Barker and the member for Forrest talk about their farming backgrounds, the assistance they provided and their concerns for the farming sector. But, when given the opportunity to actually vote on legislation that would in the future provide, according to the parliamentary secretary's second reading speech, hundreds of millions of dollars for the farming sector, they say they are opposed to it. They claim they are standing up for the regions, but we know they are opposing our regional infrastructure funding. We know that they will be opposing the $4.3 billion we have rolled out in this budget. They oppose this and they oppose so much when it comes to the farming regions, yet they say they are standing up for farmers. There is a grave inconsistency between what the coalition say and what they actually do.

We have heard the member for Barker and the member for Forrest say that they have not been consulted. There has been extensive consultation on this matter. I heard some discussion about the issue of the additionality test, but changes on these matters have been made as a result of the consultation process. The National Farmers Federation supports what we are doing here. The last time I looked, the National Farmers Federation was not affiliated with the Australian Labor Party. They actually support what we are doing here, yet those opposite will not listen to them.

They will not listen to them on the issue of climate change either. We accept the science of climate change here; those opposite really do not. Anyone who comes to question time hears the comments made by those opposite—over in that corner where all the Nats hang out. You can hear what they have to say and you can hear the comments they make—they do not accept the science. On this side, we want to price carbon. We want to make a difference to the environment, improve the situation for farmers, improve the situation for our regional areas and give farmers the opportunity for a new industry, an industry that could help them whether they be wheat farmers, tree planters, beef farmers or involved in the dairy sector.

I have the honour of representing many farming communities in the electorate of Blair in South-East Queensland. We are providing a chance for a new industry for hard-pressed regions, regions such as those in my area of South-East Queensland affected by the flood—the Somerset and the rural parts of Ipswich. And those opposite are opposing it. They are trying to delay this. I do not understand it. I truly do not get why the coalition is opposing this. They know there has been extensive consultation. In fact the members opposite have talked about the extensive consultation.

It is inaction on climate change. Whenever the opportunity arises, such as with the Carbon Pollution Reduction Scheme that they voted against many times in the House and Senate, they want to take a giant step backwards on climate change action—every single time. It is a disgrace. We want to assist farmers, households and low-income earners because we know our economy needs to transition to a cleaner energy economy. We know we have to do it. We know we are not jumping ahead of the world; we know we are going with the world on this.

We are taking steps to improve our economy. This is a great national reform. We need to take steps. So on this side of the House we say we are going to tax the polluters and we are going to help the community, low-income earners, farmers and small business. Those on the other side want to tax those people and help the big polluters. I just do not get where the coalition parties are coming from these days and I do not think their natural constituency, which they think is the farming sector, will go with them on this issue. I do not think the farming sector will support them on this issue; they will be opposed to them.

This is important legislation. It is not as though we have come up with this idea recently. I recall it being an election commitment. I can recall sending out press releases on this. I can recall speaking on River 94.9 radio about carbon farming. I remember discussing this with local journalists and farmers in my area. I remember having this discussion all through the campaign—it is not something new that we have come up with. It is not something that the opposition has not heard about before.

This is going to afford abatement opportunities in the agricultural sector that will give it a new industry. It is a very good thing for agricultural areas. We will see the need for those farmers to have a good look at the kind of work they are undertaking. Farmers are used to difficult conditions. They are used to markets and know what markets are like because they deal with them, whether it is beetroot, carrots, lettuce or cauliflower.

We are going to address salinity, reduce erosion—tree planting will help—and make sure that we improve soil health and productivity. We will do that by increasing carbon storage in those soils. We will help to protect biodiversity and degraded landscapes by revegetation. We will see farmers undertake that sort of work. We will fulfil our election commitment to help farmers, forest growers and landholders to access the carbon markets. The member for Dobell very accurately outlined what we are proposing to do.

This is an important initiative because we believe climate change is real. So many on that side of the House deny the science. We believe that acting on climate change is the right thing to do for our economy. We are not going to play politics on this issue. It is a very serious issue. The coalition members tonight are playing politics—and why wouldn't they? They believe they have a chance. They think that if they can narrow the political agenda to a couple of issues—not talk about the economy or the things that affect people—they can scoot into the Lodge. That is what they want. You hear it in every speech in this place from those opposite. It is not about the national interest; it is about their short-term interest. It is not about creating jobs, taxing polluters, transitioning the economy or assisting people. It is about their short-term interest. That is what they are all about.

I will talk to the second reading amendment that the member for Flinders moved. We know that farmers and landholders want access to carbon markets. Contrary to the coalition's record, they are holding back those markets as well as farmers, income and opportunity. With this amendment, the member for Flinders has basically told farmers in my region and in the region of the member for Maranoa —I see him sitting over there—that the coalition would rather play politics than support the farming sector. That is what they have said today.

The farmers and landholders in Blair want me and all the people in this House to end the politics on this issue. They want to make sure that we have a framework—and we set out the framework back in February this year—and that the legislation is in place. I mention to the House the National Farmers Federation and what they submitted to the House of Representatives Standing Committee on Climate Change, Environment and the Arts inquiry on this issue. They said about this legislation:

The legislation has also addressed the NFF concerns around potential perverse outcomes in relation to food production, water, local communities, employment and biodiversity, as well as reducing some of the uncertainty and administration costs surrounding crediting periods, reporting timeframes and offsets compliance.

…   …   …

The government deserves credit for listening to the farm sector and modifying its proposal to ensure that genuine abatement opportunities under the CFI are not unnecessarily overlooked.

That looks like we have railroaded the whole thing through, doesn't it? It really looks like we have not consulted with the farming sector at all! Those opposite should go back to the farmers they claim they represent and have a word with them about what this is all about.

The carbon farming initiative is based on the science of climate change. On this side of the House, we believe it is true. My estimate is that most people on the other side of the House do not really believe the science. You see their response with the member for Tangney going beetroot in the face every time climate change is mentioned. We hear the Nats and the Libs in the corner at the back—the LNP members from Queensland—casting doubt on it. We know the member for Wentworth really believes in the science of climate change and, in his heart of hearts, I believe the member for Flinders believes that climate change is real and that human beings contribute to the environment in an adverse way. But many people over there do not—and you can hear what they say.

The carbon farming initiative is important and the department is going to release over the next few weeks a number of details of methodology which will show in practical terms how particular landholders can put projects together. As I said, we have consulted extensively. On the regulations, we have established a positive and negative list and we will be providing details of these lists very shortly. The regulations dealing with the technical matters are required to be based on independent advice from the Domestic Offset Integrity Committee. It is essential to the credibility and value of the offset credits which are created by this carbon farming initiative. A scheme where the activities are added and credits are based on politics, which is what those opposite want, has no credibility at all.

The coalition really should stop playing politics with this. We are trying to reward farmers with an income source and those opposite are opposed to it. Labor are doing a lot of stuff with respect to protecting the environment in my electorate and elsewhere. We are committed to a more sustainable environment by investing in our Caring for our Country programs on the ground. I have seen many of them in my electorate. We are committed to managing water resources in the Murray-Darling in a way that supports healthy rivers, strong communities and sustainable food production. We have delivered generational water reforms in the Murray-Darling Basin and we are giving communities confidence to plan for the future, whereas those opposite have delayed, delayed and delayed on the Murray-Darling Basin.

One of the first acts of this Labor government—of which I was very proud—in 2007, when I was elected, was to ratify the Kyoto protocol. We expanded the renewable energy target to ensure that, by 2020, 20 per cent of our electricity comes from renewable energy sources. We have supported green jobs, and I have seen that locally in my electorate around Ipswich and in the rural areas. We have modernised the economy by implementing many clean energy initiatives. We have helped local schools to tackle climate change by installing solar panels on roofs and water tanks. I have seen those across Ipswich and also in the Somerset region. These things are important.

By setting a price on carbon and also implementing the Carbon Farming Initiative we are taking action on climate change. We think it will drive innovation and investment. Hard-pressed regional and rural areas know how important markets are, how important farming production is, how important a dollar is and how hard it is to earn. So this will give them jobs for the future and whole industries in areas like the Lockyer Valley and the Brisbane Valley. I look forward to seeing those.

As I said, we are ensuring the big polluters are the ones who bear the burden and we are ensuring that the farming sector is looked after in this way. Only Labor governments would help rural and regional Australia and only Labor governments would help the farming sector, because those opposite claim they do but they deliver almost nothing.

As a result of those Building the Education Revolution initiatives in their electorates, which helped those really hard-pressed rural communities—places such as Esk and Fernvale in the electorate of Blair—those multipurpose halls provided evacuation centres in the recent flood. Yet those opposite voted against that initiative. Those opposite should hang their heads in shame. Every chance they get, they vote against regional and rural Australia. Every chance they get, they oppose climate change initiatives. Every chance they get, they do not support the farming sector. They will say it, they do so here but, when it comes to the crunch, they don't.

Labor are introducing emission standards on coal-fired power stations to ensure future electricity generation is cleaner and greener. We are delivering a strong signal to investors to build a low-pollution economy for the future. The Carbon Farming Initiative will provide economic opportunities for farmers, forest growers, landholders and will help the environment by reducing carbon pollution. This is something that we are doing—something those opposite are opposing. Once again, the coalition show that they have no determination and no commitment to regional and rural areas. Once again, they betray them by the speeches they make in here and by the votes that they will cast later on tonight on carbon farming. This is another great Labor initiative, helping the farming sector, opposed by the National Party, which preen, pose and parade in this place as supporters of the farmers. When they get a chance to vote, they will vote against them. They will vote against the legislation tonight. I want every farmer in the electorates of Blair, Maranoa, Flynn and Kennedy, and all those farmers in Queensland, to listen to these debates, to listen to what the coalition are saying and, when you cast your vote next time, think about who supports regional and rural Queensland and who supports farmers. I want to make it crystal clear to them: the federal Labor government does that, as we always have.

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

I rise tonight to speak on the Carbon Credits (Carbon Farming Initiative) Bill 2011 and cognate bills. I join this debate with a background, unlike the member for Blair, as a farmer for many years, having to farm the land to ensure I could pay the bills, feed and educate my children. So I have a very close affinity with the soil and the land, as did my parents and my grandparents before me. So I come to this debate with a background knowledge, having been a working participant in a productive farm.

I also come to this debate as the member for Maranoa, which has a very large agricultural base, from the edge of the Simpson Desert in the west of the electorate to the highly productive Darling Downs soils, where we have real pressure at the moment from mining companies and coal seam methane gas companies. But I did not hear any mention of that from the member for Blair. I want to talk about the competition between both those sectors in my address tonight.

I also come to this debate tonight as having observed farming practices not only across Australia but also in other parts of the world. I particularly refer to my studies as a Nuffield scholar in the United Kingdom and Europe, observing some of the farming practices in some of the oldest farming lands of the globe, apart from those perhaps in the Middle East and North Africa. Interestingly, when we talk about carbon sequestration, that has been going on for centuries and centuries. When you think about it, probably the best carbon sequestration is the old golden hoof fertiliser—the manure from the feedlot, the organic matter being returned to the soil.

That is what this bill seeks to achieve: to convert atmospheric carbon into soil carbon. Of course, when you think about it, golden hoof fertiliser does that daily. It returns organic matter back into the soil, which will break down over time Crop residues are of course a part of that breakdown into soil carbon.

Carbon sequestration to improve productivity on the land is a good idea. The coalition supports that. Contrary to the spray we have had from the member for Blair, we do support that. We support the target. But it is how we get there that is important. Our amendment wants to put a stop on this legislation until we see the regulations that will be attached to this legislation. It is like asking us to buy a pig in a poke: site unseen, and committing to a Carbon Farming Initiative without all the regulations in place. As I said, carbon sequestration to improve productivity and soil structure is a good idea. I have seen it in many parts of the world. We have practised it—without legislation I might add—on our own farm. In fact, after my Nuffield scholarship year, I purchased imported farming equipment so that we could better utilise our crop residues. Much of the farm machinery that had been used in Australia was incapable of retaining crop residues on top of the soil and planting new crops, so we bought farming equipment from importers who had bought it in the United States of America.

The other aspect of this is that we are concerned that this legislation could lead to the wholesale transfer of prime agricultural land, some of our best land, to growing trees that cannot be harvested for 100 years. If they are going to be used for carbon sequestration, they are going to have to be locked away for 100 years, locking up the land as well. That is a genuine concern that I have, that farmers in my electorate would have and that I am sure the National Farmers Federation would have. It is biased towards tree plantations, as the regulations are now, and native vegetation will not be allowed to be included under this bill.

In my own electorate, we saw the Queensland Labor Party lock up large tracts of land when they put a ban on tree clearing. Farmers still come to me and say, 'I wouldn't mind locking up some of my land, but I can't get anything for it.' I am talking about native timbers, native vegetation. It is particularly in western Queensland that these farmers come to me. They may have bought their land in good faith, wanting to develop it over their lifetime and perhaps their children's lifetime. But the ban on tree clearing in Queensland locked up, in some cases, up to half or two-thirds of that land, and they can never go back to developing it while that ban remains in place. And they cannot participate in this Carbon Farming Initiative because it is native vegetation. I understand that the state government has claimed that under the Kyoto protocol, and that has already been counted, but these farmers are not able to continue to develop their farms. They would have done it responsibly, as I am sure the member for New England would agree. We know there have been mistakes made in the past, and we have all learnt from the mistakes, but there are farmers out there who have got native vegetation and who will not be able to participate in what is proposed in this legislation.

I mentioned the issue of our prime agricultural land and the conflict that we have in some cases with the resource companies, particularly calcium methane gas and large resource companies, wanting to mine coal. I have already got an international company in my electorate that wants to buy up to 80,000 hectares of land that is actually mapped on the Queensland prime agricultural land or strategic cropping land map as being strategic cropping land. They want to basically open it up for an open-cut coalmine. That is 80,000 hectares of magnificent cattle-producing, grain-producing, food-producing land. It will be locked away as this coalmine moves through it over the next 30 years, taking prime agricultural land out of food production.

I have already got a gas company in my electorate that is growing trees as part of its strategy to deal with the water that has been extracted as part of the coal seam methane gas process. If you are going to extract coal seam methane gas, you have first got to de-water the aquifer where the coal bed is. The water comes up and you have got to do something with it; you have got to make good with it. This company have decided that they are going to grow trees. They have purchased a property, formerly a very productive cattle property. This water is a by-product that they thought they might have been able to just let run away down the creek somewhere, but they have got to do something more with it. What are they doing with it? They are using it for a timber plantation. I do not know whether the company are going to try and sell carbon credits on this land, but it is a very good example of taking good agricultural land out of food production and using it for a timber plantation.

This raises questions about what land will be used and, if this legislation goes through, what restrictions there will be in the Carbon Farming Initiative on plantation timber being planted on good food-producing land in Australia. Sixty-odd per cent of Australia's farming land is owned by Australians. The other 40 per cent is owned by foreign interests. Will foreign based companies want to come to Australia to buy some of our prime agricultural land, our food-producing land—it could be strategic cropping land or good grazing land, pasture land—convert it to timber and then receive a carbon credit for planting a timber forest that is an offset to emissions that they have to deal with in another part of the world? Will they be receiving the carbon credits? Will they be investing in some of this land?

The mining companies have got far more available money to buy land than the farmers can ever hope to have to keep their farms in their own possession. I have got very near family members right now dealing with a gas company. In the negotiations that people near them have been going through, it really ends up with the farmer saying, 'We're not going to be able to coexist with the gas company because they want to almost take over the land for the next 30 years,' as they have in some areas. As I said earlier, they have planted trees on what was once a cattle-producing farm. One example I know of is that for the last nine months this farm that is very close to my family has backgrounded some 2,000 head of cattle. It is part of the food-producing chain to background cattle to put into a feedlot and from the feedlot process it into food for Australians and also for export. But they do not believe they are going to be able to coexist with that company. What will they do if they buy it? They have bought quite a lot around the place near them. Are they going to convert it, like another company north of Roma has, into a plantation because they might be able to sell carbon credits from it with the water that they have extracted without a licence from underground as part of the coal seam methane gas extraction process? The coal seam methane gas is then sent to Gladstone. We know it is all about great wealth and new jobs—we understand all of that—but what are they going to do with all the land as they continually buy these wonderful food-producing areas? Because of this legislation, they might be going to see an opportunity: 'Well, we'll put it down for trees. We've got water that we've got to deal with. It's a bit of a problem this part of the coal seam methane gas extraction. We'll grow plantation timber and get a carbon credit for it and take it out of food production.'

I want to touch on the carbon tax. The carbon tax that this government wants to introduce is going to do untold damage to the viability of many rural farming enterprises across Australia. The tax is going to drive up the price of electricity. You cannot get away from having to use electricity in most farming operations that I am aware of, whether it be dairy, feedlot, the wool industry or the beef-processing sector. It is essential element of either the primary or the downstream processing side of the agricultural food production.

What this carbon tax will do is drive up the cost of electricity. The tyranny of distance has always been a factor. I am sure the member for New England would concur about the tyranny of distance in Australia, given we have one of the largest geographic areas of the countries in the world. We have populated it with great farmers with great skills across this large land mass, but the tyranny of distance means the transport sector will be hit by this carbon tax. How will farmers respond as their costs go up? They are going to have to drive their land harder. When it comes to crop rotation or pasture renovation, because of the cost increases they are going to look at the bottom line and say, 'Well, we can't afford to do that.

We have actually got to drive our soils harder. We're going to have to use more fertiliser rather than rotate our land into a break crop or have a crop rotation and get out of a mono culture'—as I see increasingly. So, whilst we on this side of the House support the initiatives to look at carbon sequestration—and farmers do—our point is that it is how you get there. The regulations are not with this bill. We still have not seen the CSIRO or ABARES studies which are due out on this whole issue of carbon farming. We should wait for those reports before we vote on this bill. That is why this amendment is so essential and this bill should not proceed at this stage tonight. (Time expired)

Mike Symon (Deakin, Australian Labor Party) Share this | Link to this | Hansard source

I speak in support of the Carbon Credits (Carbon Farming Initiative) Bill 2011, the Carbon Credits (Consequential Amendments) Bill 2011 and the Australian National Registry of Emissions Units Bill 2011 in this cognate debate. This legislation is a part of the federal government's response to the challenge of tackling climate change and will create opportunities for Australian farmers and landowners to benefit from reducing carbon emissions or from storing carbon in their soil. The Carbon Farming Initiative will reward land based carbon abatement projects with credits for each tonne of carbon saved or stored, which can then be sold in domestic and international markets or retained to offset emissions. Carbon abatement can be achieved by land based projects which reduce emissions or remove carbon from the atmosphere. An example of projects that reduce emissions is the capture and destruction of methane emissions from landfill or projects that reduce methane emissions from farm animals. The company or entity that invests funds into reducing the leakage of methane emissions into the air will receive in return a credit for that carbon abated, credits that can be sold or retained to offset other emissions. Examples of projects that remove carbon from the atmosphere include reforestation, revegetation, avoided devegetation, improved management of forests and enhanced soil carbon. The bills we are debating today are just one small part of the Labor government's response to climate change.

The Labor government is committed to introduce a carbon price to take effect from 1 July 2012. Although the price on carbon would not place any liability on agricultural, forestry or legacy waste emissions, the Carbon Farming Initiative bill is about creating an opportunity to use the demand for carbon offsets created by a price on carbon to fund projects on the land that would reduce carbon. The Gillard Labor government understands the importance of having accurate scientific information on climate change. We need to know the science, what the international community is doing to deal with climate change and the world's best practice. So it was the Labor government that established the Climate Commission as an independent source of information on the science and impacts of climate change, global responses to climate change and the operation of carbon pricing. The Climate Commission is supported by a scientific advisory panel made up of nine independent experts. Just this week, on 23 May, the Climate Commission released its report entitled The critical decade: Key messages. There are some salient lines in it. I quote from its report:

There is no doubt that the climate is changing, the evidence is overwhelming and clear. The atmosphere is warming, the ocean is warming, ice is being lost from glaciers and ice caps and sea levels are rising. Global surface temperature is rising fast; the last decade was the hottest on record. In the last 50 years the number of record hot days in Australia has more than doubled.

This is also from the report:

A very large body of observations, experiments, analyses, and physical theory points to increasing greenhouse gases in the atmosphere—with carbon dioxide being the most important—as the primary cause of the observed warming.

I believe Australia has an obligation to act to reduce its carbon emissions. The science clearly proves that reduction in carbon emissions is the key to tackling climate change. As the highest per capita emitter in the developed world and one of the 20 largest emitters on an absolute basis, Australia must take action.

As part of the international efforts to tackle climate change, Australia under the Labor government ratified the Kyoto protocol, a move the Howard Liberal government could not bring itself to make. Under the Kyoto protocol, Australia is committed to restraining its national emissions to an average of 108 per cent of 1990 levels over the first commitment period from 2008 to 2012. Whilst Australia's emissions projections released on 9 February this year demonstrate that Australia is on track to meet this target, without additional policy action our emissions are projected to be 24 per cent above 2000 levels by 2020 and 44 per cent above 2000 levels by 2030.

The ability to generate saleable carbon credits provides an investment incentive helping to channel carbon finance into land sector abatement. These bills will allow for carbon farming projects to be created and for the carbon sequestered in these projects to be exchanged for Australian carbon credit units. It is crucial that the integrity of the abatement projects is protected, and this will ensure that credits can be bought and sold with the assurance that carbon has been or will be abated.

Under this legislation, the Australian National Registry of Emissions Units will oversee the issuing of the Australian carbon credit units. The Australian national registry already exists as an electronic system which is used to ensure accurate accounting of the issuance, holding, transfer, acquisition, cancellation, retirement and carryover of emissions units under the Kyoto protocol. This legislation will combine the registry functions of the Carbon Farming Initiative and the Kyoto protocol together in the Australian National Registry of Emissions Units.

Offset projects will be required to use methodologies assessed and endorsed by the Domestic Offsets Integrity Committee and approved by the minister. The committee is an independent expert that assesses draft methodologies proposed for use under the scheme. These methodologies contain the detailed rules for implementing and monitoring specific abatement activities and generating carbon credits under the scheme.

This legislation also commits to monitoring the impact of the scheme on the environment and on rural communities and to taking steps to prevent perverse impacts if there is evidence that projects are likely to have a material and adverse impact on the allocation of prime agricultural land, water availability or biodiversity.

I refer to statements in support of this legislation from the National Farmers Federation. On 24 March this year they put out a media release welcoming the introduction of the Carbon Farming Initiative legislation to parliament and noting that the NFF were pleased it had addressed a number of key concerns raised through the draft consultation process. Further, they said:

The Government deserves credit for listening to the farm sector and modifying its proposal to ensure that genuine abatement opportunities under the CFI are not unnecessarily overlooked.

The government has been supporting research into land based carbon abatement. Some of the serious work in researching how carbon abatement can be achieved on the land has already commenced. For instance, under the Australia's Farming Future program, the federal government has funded $46 million over four years to research how primary producers can reduce carbon emissions. The CSIRO and other research institutions are making important advances under this program.

The Soil Carbon Research Program funded under Australia's Farming Future is developing a scientific understanding of the potential of Australia's agricultural soils to sequester carbon. Early trials show that perennial grasses including kikuyu grass can increase soil carbon levels. Additional research is investigating tillage methods, crop rotation and other practical steps that may increase carbon sequestration. Research to date is showing that if farms adopt new tillage methods or use perennial grasses they could increase carbon absorption in the soil, generate carbon credits and improve the quality of the land.

Other research programs include the Reducing Emissions from Livestock Research Program. It is estimated that direct livestock emissions account for about 12 per cent of Australia's greenhouse gas emissions and account for nearly three-quarters of all agricultural emissions. Researchers are investigating whether livestock can be bred as low-methane emitters without compromising production. Another area of research is in the investigation of biological methods to reduce carbon emissions—for example, viruses to attack the microbes that generate methane emissions in the digestion process.

Thirdly, research is being conducted into feed supplements and the impact these may have on the carbon emitted by farm animals. Recent research at the Victorian Department of Primary Industries in Ellinbank shows that modifying the diet of dairy cows with feed supplements such as brewers' grains, a by-product of beer making, cuts cows' methane emissions. The research shows that, for every one per cent increase in fat in the diet of dairy cows, methane emissions are cut by 3.5 per cent. Lead researcher Peter Moate said that this was significant, as each year a dairy cow emitted approximately the same amount of greenhouse gases as a family motor car. He also advised that the fatty supplements did not affect the dairy cows' appetite or milk production.

The research being conducted into how to reduce carbon from farming and how to absorb carbon into land and vegetation is showing positive results, and this legislation has the potential to attract funding for implementing this research into rural communities, as the reduction in carbon will now generate saleable certificates.

The Carbon Farming Initiative will create an economic opportunity for Australian farmers and other land managers to generate accredited carbon credits which can be sold in Australia and allows Australian agriculture to take advantage of the growing international carbon market. The legislated scheme will allow sellers to deal directly with buyers and leverage the opportunities of the marketplace. Such a marketplace allows companies to invest in local land sector abatement through long-term contracts and partnerships with farmers and landholders. But, in order to drive this marketplace for carbon abatement schemes, we will need a price on carbon. A price on carbon emissions will create demand for carbon credits, as companies and entities—in fact, everyone involved in the process—will need to reduce their carbon emissions or purchase carbon credits to offset their emissions.

On 24 February this year, the government announced a framework for a carbon price due to take effect from 1 July 2012. This framework does not place any liability on agricultural, forestry or legacy waste emissions produced. However, the Carbon Farming Initiative will ensure that any project that reduces emissions on the land will be able to generate funding from the sale of carbon credits.

The Labor government is committed to taking action to deal with climate change. This legislation is an important part of that action and I commend these bills to the House.

Darren Chester (Gippsland, National Party, Shadow Parliamentary Secretary for Roads and Regional Transport) Share this | Link to this | Hansard source

In joining the debate on the Carbon Credits (Carbon Farming Initiative) Bill 2011 I intend to take up where the shadow minister for agriculture left off earlier this morning by posing the question: why would we trust this government in relation to the future of farming? It is like there is a message coming from those opposite: I am from the Labor Party and I am here to help. And as the shadow minister rightly indicated the bill before the House is incomplete and misleading. The shadow minister used the phrase that it is like 'mutton dressed as lamb'. At the risk of prolonging the rural metaphors for too much longer, there are so many holes in this you could drive a Mack truck through it.

This government expects the coalition to blindly accept this bill. They seem to be simply saying, 'Trust us and we will add the details later on in the regulations.' You will have to excuse my cynicism, but the people of my electorate have no reason whatsoever to trust this government when it comes to its policies relating to climate change and emissions reductions.

This bill, as those opposite have indicated, feeds directly into the broader debate about this government's policies on so-called 'dangerous' climate change. The minister for climate change was in Gippsland last week and was on ABC Radio, where he almost tied himself in knots avoiding using the word 'tax'. During the interview I counted the number of times the minister referred to the government's carbon policy, and it was all about a 'carbon price'. Obviously the focus groups have tried to sanitise the tax now. It has got to be a carbon price. We do not talk about tax any more, apparently. Painfully avoiding the word 'tax' will not escape the attention of the people of Gippsland, who, as on many occasions in the past, will be at the pointy end of any government policies in relation to the emission of carbon dioxide.

On a more positive note, it was good that the minister actually visited Gippsland. He is the first cabinet minister to visit and actually consult with my community in relation to the government's climate change policy. I appreciate that he took the time to attend a summit in the electorate. But I would encourage him to go out into the broader community. If he had he would have picked up on the anger and disappointment within my community about the way this government has conducted itself on this particular issue. The bottom line is that the people in Gippsland and the La Trobe Valley do not want this government's household assistance package. They want to keep their jobs.

This government accuses the coalition of running a scare campaign, yet listen to their rhetoric. Listen to the words they use out in the community in relation to their policies on carbon dioxide emissions. They love using the term 'dangerous climate change'. They cannot help themselves—they have to refer to 'dirty' coal-fired power stations. They must always mention '1,000 biggest polluters'. They do not mention the fact that they also happen to be some of the biggest employers in this nation. Let's vilify them as these 'dirty polluters' who are causing 'dangerous climate change'. This rhetoric has got to stop. This government is embarrassing itself with the public by its attempt to vilify some of the most successful businesses in our nation, and they are also vilifying the men and women who work in these coal-fired power stations, who have done nothing more than they were asked to do by our nation. They have provided cheap, reliable baseload energy for our nation and now this Labor Party—the party that used to stand up for workers—is vilifying these people in communities like the La Trobe Valley. This government should be embarrassed by its conduct.

We also have the government out there talking about 'saving' the Great Barrier Reef and Kakadu, as if Australia alone could actually do anything in terms of the ultimate environmental impacts of any forecast in relation to climate change. This deliberate scaring and spreading of myths is all about gaining support for a tax.

Government MPs are also desperately trying to avoid mentioning this fundamental breach of trust. This is where the government has its biggest problem in the electorate. Before the election this Prime Minister said:

There will be no carbon tax under the government I lead.

It is becoming abundantly clear that this Prime Minister is not leading anything, when you have Kevin Rudd running foreign policy, Bob Brown running domestic policy and the Prime Minister running out of excuses. But put that aside. The fundamental breach of trust is where this government has its greatest problem. You now bring this bill into the House and expect Gippslanders to take you on trust that the Carbon Farming Initiative is in their interests, when the government has not even released the details of how the carbon tax, which will directly feed into this process, will play out in the broader community.

When government ministers come to my electorate, I have constantly asked them just to be honest in this debate about climate change. And I can report a small breakthrough this week. We had Minister Combet actually admitting that no Australian solution to this problem would save the Great Barrier Reef. He has finally come out and explained that it will take global action. But, if you had listened over the past three years during which I have been in this place, we have heard constantly from those opposite how they are taking action now to save the Great Barrier Reef. But Australia emits only 1.5 per cent of total global emissions. If we cut all our emissions, we do not do anything about the other 98.5 per cent, so how is that going to save the Great Barrier Reef.

Stop telling people lies about what can be achieved by Australians acting independently of other nations. It is great that the minister this week finally indicated that we are better off directing our money and energy at direct local action ahead of any global efforts in terms of the so-called 'saving' of the Great Barrier Reef. We have had our own climate change zealot in Tim Flannery out there admitting the same thing this week. He even went a step further when, in March this year, he said:

If the world as a whole cut all emissions tomorrow, the average temperature of the planet is not going to drop for several hundred years, perhaps over 1000 years.

To me that is a very telling admission by Mr Flannery, because he has finally acknowledged that we are talking about long-term change. The temperature of the planet is not going to drop for several hundred years and perhaps over 1,000 years. That is what Mr Flannery said. He also said this week that reputable scientists do have different views on man's impact and man's contribution to climate change. So, finally, there is a little bit of honesty coming into the debate and some sort of recognition that not everyone who has some degree of caution in relation to the more extreme forecasts is a sceptic or somehow a denier, now that even Mr Flannery admits that there are reputable scientists who have different views.

We are after all only talking about models and forecasts. Just as an aside, when the weather bureau cannot reliably tell me what the weather is going to be like tomorrow and then tells me that in 100 years there are going to be sea level rises of a metre as a result of climate change, I think I am entitled to exercise a level of caution in deciding whether to accept everything that is put to me about weather, climate and long-term trends. This government wants to take reckless action that will send Australian jobs overseas by driving up the costs of production, yet, as Tim Flannery has indicated, the average temperature of the planet will not move for 1,000 years.

I want to refer specifically to the concerns I have about the future of the Latrobe Valley under this government. When the minister visited the Latrobe Valley he repeatedly refused to give a guarantee that this government will actually undertake a social and economic analysis of the impact of its policies in our community. The question must now be asked: what is the minister hiding? Why won't the Gillard government be honest with the people of the Latrobe Valley and undertake a full assessment of the costs and benefits of its policies in relation to climate change and emissions reductions? That is the fundamental point for the people in my region. If the government is not prepared to explain what the actual costs and benefits to them and their households will be, why would we take it at its word on the carbon tax or any other policy? The Latrobe Valley, as I have said many times in this place and I say again tonight, is absolutely at the pointy end of this debate, yet the government has refused to undertake a cost-benefit analysis of how its policies will play out in a regional community like Gippsland and the Latrobe Valley. Extending the argument, why would farming families take this government at its word on the bill before the House when the Labor Party is happy to strip water out of communities in the Murray-Darling Basin without any consideration whatsoever of the broader social and economic impacts?

We are faced with the same situation here in relation to the government's policies on pricing carbon. Instead of the empty rhetoric we have been getting, the families in the Latrobe Valley deserve to know whether their jobs will be affected under this government's carbon tax. If the government does not know the answer yet—if the government does not know whether or not jobs will be lost—how can it realistically expect the people of my community to support its policies?

I do acknowledge that the Minister for Regional Australia, Regional Development and Local Government acknowledged today in the media that coal will play an important part in our nation's energy needs for decades into the future. That is a breakthrough. It is a breakthrough to have a government minister actually acknowledge the importance of coal. I wonder how Labor's partners in government, the Greens, reacted to that? I wonder if that statement had to be run past the Greens' media unit, since the Greens have such have such a hold over this government? I sincerely hope there will be other ministers who will state the obvious fact that coal is such an important part of the future energy needs of our nation.

I believe the Latrobe Valley has a great future. Our challenge, though, is to get rid of this government to allow us to achieve that future. In the Latrobe Valley we have 500 years worth of brown coal reserves. I cannot think of another nation in the world with an extraordinary natural resource of that capacity that would simply be saying, 'We can't use dirty brown coal; we're going to leave it in the ground.' That is a ridiculous proposition in a world where energy demand is growing. Our challenge—

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

That's cheap populism.

Darren Chester (Gippsland, National Party, Shadow Parliamentary Secretary for Roads and Regional Transport) Share this | Link to this | Hansard source

I will take up that interjection. Now we know what backbenchers from the Labor Party actually think. They think it is cheap populism to talk about Latrobe Valley power workers' jobs. Well, congratulations to the backbenchers of the Labor Party. That is what they now think about the workers of our nation. Congratulations! It is no wonder the Labor Party cannot hold a seat east of Melbourne if that is what they think of the workers these days. You should be embarrassed.

There are 500 years worth of brown coal. It is a reliable natural resource. It provides a cheap form of energy, and our challenge is to use it in the most environmentally friendly way possible. There have been some remarkable efforts over the past decade by companies that are exploring ways to reduce the moisture content and export brown coal. There is a well-advanced proposal to use the carbon dioxide emissions to grow algae for several environmentally friendly products, and I understand there have been some great breakthroughs with a particular project in the Townsville area. Carbon geosequestration remains, I admit, something of a holy grail for the coal-fired power stations, and it is doubtful whether it will proceed on an industrial scale in the foreseeable future, but the research and development is needed in this particular space.

The point I am trying to make is that over the past six or seven decades working families—who the Labor Party used to speak so much about—in the Latrobe Valley have made an enormous contribution to the Australian nation, and they will continue to do so if they are supported in the future. They should not be vilified in this place. The government should not be using terms like 'dirty coal-fired power stations' and 'the 1,000 biggest polluters'. It should start acknowledging some of the positive achievements of these families working in my region. The Nationals do support a range of policies that provide for direct action to meet the agreed emissions reduction target of five per cent by 2020, but our policy is to avoid the punitive nature of the carbon tax and provide incentives for these companies to invest in technology and new systems to reduce their emissions. Some very successful trial projects have already been undertaken in the Latrobe Valley region with funding from both the former Labor state government and the coalition government at a federal level.

We do support direct and practical environmental action that achieves a positive outcome, makes sense in terms of improved productivity and builds a bridge with the sections of the community who have some reasonable doubts about some of the more extreme forecasts. I believe that is the real opportunity for us in building community consensus about the need to undertake practical environmental works.

This government has a long list of failures when it comes to its so-called green programs. There was the home insulation disaster in which four people tragically lost their lives. We had the abandoned cash-for-clunkers policy and the green loans and home assessors programs. The wasteful and reckless policy we have seen from this government is probably the worst in living memory, and now the government expects us to trust it with this important piece of legislation—the same government that could not deliver any of these programs just mentioned, the same government that cut $11 million out of the forward budget estimates for Landcare.

So we have a government that will cut money out of Landcare but is still able to find money for a climate change advertising campaign. Given a choice between propaganda and propagation, this government will always go for self-promotion and the propaganda campaign. I do not believe that the community trusts this government to be able to deliver any program, particularly something as complex as this carbon farming initiative. Like other speakers on this side of the House I will reserve my judgment until we see the full details of this bill, but I am not convinced that this government understands the risky nature of the path it wants to lead Australian farmers down. At a time when food security should be the focus of national attention, we run the risk of introducing a scheme that will see prime agricultural land turned into forests on the back of government incentives. Any schemes that distort land use decisions and result in large tracts of prime agricultural land being turned into plantations are a huge risk for the future of rural and regional Australia. Our prime agricultural land must be protected from this type of government interference. I congratulate the many members on this side of the House who expressed similar sentiments. I am not against tree planting or reforestation projects in the appropriate places, such as on the more marginal land in our nation, but that has not been the experience of many rural and regional communities over recent years. I fear that this government does not properly understand the needs of regional communities. Simply saying 'trust us' will not wash with farming families.

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

The rationale for these bills is to establish the Carbon Farming Initiative to give farmers, forest growers and landholders access to domestic voluntary and international carbon markets. This will begin to unlock the abatement opportunities in the land sector, which currently make up 23 per cent of Australia's emissions. The Carbon Farming Initiative will include a carbon crediting mechanism, the scheme; funding to fast track the development of methodologies for offset projects, including on-farm demonstration of biochar; and information and tools to help farmers and landholders benefit from carbon markets.

In 2010, this government undertook to give farmers, forest growers and landholders access to carbon markets so that they could offset costs that they might incur while they abate carbon emissions, which currently make up 23 per cent of those in Australia. The Carbon Credits (Carbon Farming Initiative) Bill 2011 fulfils that election commitment.

Australia has among the highest agricultural emissions of the developed countries. But because we are a very big country we also have significant opportunities to increase carbon storage in our landscape. This scheme presents an opportunity for Australia to address those high emissions and for the agriculture sector to be part of the ongoing actions to address the changing climatic conditions.

The CSIRO and other research institutions are making important advances in carbon estimation techniques. And, as revealed in the House of Representatives report Farming the future, which included evidence from around the country, innovative farmers have already been developing ways to improve the health of agricultural soils, to improve herd efficiency, to include tree farming as part of their mix and to generally farm more sustainably.

This scheme will drive and reward efforts in developing Australian innovation. Farmers and landholders will be rewarded for their actions to reduce or store carbon pollution. This is a very important step forward for regional and rural Australia. It will create incentives to protect our natural environment and adopt more sustainable farming practices as well as mitigate climate change. Increasing carbon storage in agricultural soils improves soil health and productivity. Revegetation will help restore degraded landscape, protect biodiversity and bring underutilised land into production. Tree planting can help to address salinity, reduce erosion and act as a carbon sink.

In this discussion we have to ask ourselves about the role carbon plays in our daily lives and what it is about its presence in our lives that makes it so important that we do something about it. There needs to be an understanding of what carbon is and how it relates to our lives. We rely on a variety of elements and compounds for life, including nitrogen, oxygen, carbon dioxide, helium, methane and hydrogen. There are some others, but they are not very important to this discussion. A mixture of these makes up the air we breathe. Carbon dioxide is a minor part of the air but it has a major impact as it helps to keep our planet and us warm and prevents us from freezing to death.

Of course, there is also a bad side. Too much carbon dioxide will cause the earth to heat up and become too hot—the greenhouse effect. That is a scientific fact. There is enough science to give us that belief. It is this that is causing us to query the growing carbon content of the atmosphere. It is said that the world has been growing warmer since the industrial revolution because more carbon has been emitted than can naturally be taken up. Therefore, it is important to have some sort of control over the release of carbon dioxide, and setting a price on carbon emissions has been identified by the Stern review and the Garnaut report, among many others, as a critical policy tool for achieving carbon reductions. Therefore, a carbon price needs to be set, but we need to allow time for industry to implement measures to limit or offset the costs so that we can continue to compete in the world market.

One way of coping with unduly high carbon emissions is to relate those to how we can reduce their impact. It means that carbon has to become a commodity that can play a role in the market, much like what has been done in relation to water in this country. Therefore, we need a scheme that will allow sellers to deal directly with buyers and leverage the opportunities of the marketplace. Such a marketplace will allow companies to invest in local land sector abatement through long-term contracts and partnerships with farmers and landholders.

Markets are not new to farmers and nor are many of the things that can save or store carbon, such as trees and soil. What farmers need is a mechanism to add value to their actions and help them decide whether or not to invest. And that is what this series of bills is all about. One of the areas dear to me where this could play a very important part in the future is that of forestry. Carbon markets are one of the elements now falling into place as a potential driver of investment in forestry. By recognising the contribution of forestry to the carbon economy, we are placing a value on forestry which should allow it to compete for investment dollars with other parts of the economy.

Using trees to take up excess carbon is not new and there are other ways to lock up carbon for use in another form. But it needs to work within an economic framework so that industry can be encouraged to lessen its emissions or to trade them with another industry so the overall amount of carbon in the atmosphere is not increased.

Tasmania is well placed to develop our forest industry to be a carbon store in wood products such as building materials and wooden furniture. It can help to provide carbon credits to high emitters. But to do this, we need a trading scheme and a carbon price. Using the carbon trading schemes it is possible for rural industries to work together to develop a more sustainable farming and forestry industry.

For instance, Forestry Tasmania runs a program called Trees on Farms. Trees on Farms encourages landowners to partner Forestry Tasmania in planting trees on land that would otherwise be unproductive. The program provides a timber resource to Forestry Tasmania and a revenue stream for farmers. Forestry Tasmania provides the tree growing expertise and management, the farmer provides the land, the farmer enjoys the environmental benefits of tree growing and both share in the returns.

In the New England region of New South Wales, the Engineered Woodlands Project utilises tree plantings to provide carbon offsets, windbreaks and stock shelters, as well as a harvestable resources. Through careful design, it was possible to place a substantial proportion of a property under trees with no loss of stock-carrying capacity or productivity.

In Victoria, the Otway Agroforestry Network offers an extension service focused on farmers developing forestry skills so that they can have exclusive control of the forestry resources developed on their land. The network focuses on trees as part of the farm infrastructure, providing aesthetic value, environmental services—habitat for birds as part of integrated pest management, stock shelter and revegetation of water courses—while also providing an income stream through the production of high-quality sawlogs.

The key to success was giving each farmer the training and tools to manage the timber on their own properties, within the context of group leadership and peer support. Farmers undertook formal training through the master treegrowers course, and had access to expertise and support within the network.

Network cooperation meant that relatively small stands of timber could be harvested at commercial rates. The result of the network's operation was a significant increase in tree cover without loss of productivity, and an improvement in the commercial and environmental sustainability of individual farm enterprises.

When I listen to the doubters on the other side, I think we have to be careful about the way we treat the scientific data that we hear. If we look at the mountains of information that are currently scurrying around our media sources, our emails, our blogs and tweets and our day-to-day information—if we really come down to the nitty-gritty it appears that, although we know that there are significant changes going on, what we really do not know is their actual impact. Climate change information is only as good as the models that have been put up, and the bottom line is that they are inconclusive.

That is why we get such a range of views around the globe. Nothing is really right or wrong and we will only really know what will happen when it happens. According to Professor Michael Hulme of the University of East Anglia, one of the leading commentators on climate change, climate change projections are only as good as their models, and we know models are not infallible because they are made by us, humans—educated humans, scientists, and other professionals, but humans nonetheless.

So what we are really into is risk assessment—like an insurance company goes through all the possible risks to a body or an individual—and coming up with some plan to mitigate any possible risks. I believe that is what we are about at the moment with this debate. Nothing is absolute and the effects and risks of not doing anything in the long run depends on who you are and where you live. Like insurance companies have done for decades, trading in offsetting their risks, these bills give us an option to work on dealing with a very real risk and helping the big emitters to offset their risks by investing in the carbon reduction activities, such as farms and forestry. Shouldn't we, as decision makers, take decisions to mitigate those risks by setting a price on the cost of reducing a possible severe risk to our world?

Scientists are telling us that there are methods and systems to ensure we do not have to deal with a major world catastrophe sometime vaguely in the future—maybe tomorrow, maybe in a hundred years time. We should make those decisions now and try and alleviate the risk by understanding our systems better. There needs to be some understanding on how each activity can actually be assessed. For example, with tree growth, some trees species grow faster than others, some get a lot bigger than others and therefore will be able to process more carbon. So we need experts to advise us on the best species and the best methods. Therefore, an independent expert committee, the Domestic Offsets Integrity Committee, has been established to ensure that estimation methodologies are rigorous and lead to real abatement.

But trees ultimately die after a finite period and therefore no longer can take up carbon. So there is little point in them remaining upright taking up air space that could be replaced by a young, vigorous, carbon-devouring tree. Managed forestry allows for the trees to reach their economic peak and then be harvested for specific purposes, such as furniture, building materials, paper and even crafts, allowing that stored carbon to be permanently locked up and used elsewhere.

Other elements of the design of the scheme to ensure the integrity of credits include: issuing credits after the sequestration or emissions reductions have actually occurred; tracking of credits through a central national registry, which is included in the registry bill; transparency provisions, including the publication of a wide range of information about approved projects; appropriate enforcement provisions to address non-compliance; and a robust audit scheme based on the National Greenhouse and Energy Reporting Scheme.

Carbon storage has to be permanent if it is going to be treated as equivalent to carbon emissions from the industrial sectors—and what is more permanent than a house made of wood with its fittings and furniture all storing carbon! Participants would be able to cancel their project and hand back credits issued at any time—for example, because they wish to sell the land or use it for something else.

Land managers would not have to hand back credits if carbon stores are lost because of bushfire or drought. This is a very important point to understand. Instead, land manager-holders will be required to take steps to re-establish lost carbon stores. Temporary losses of carbon following a bushfire or drought would be covered by a risk of reversal buffer where a proportion of the credits are withheld.

So a scheme by which we can set a price for carbon and use it for assisting both industry and the rural sector in reducing emissions—which will start to mitigate the risk of further global warming—is essential for Australia. I don't believe we are alone in this. Other countries are starting to work at this problem without signing up to particular protocols; they are minimising their risk.

We have already seen Qantas highlighting that they will have to put up fares next year as the EU has penalised the airline because Australia does not have a price on greenhouse emissions. Qantas will have to pay 15 per cent on its carbon emissions from its nearest port of call. The world will not go away!

We have to start taking these steps. I support the legislation.

Barry Haase (Durack, Liberal Party) Share this | Link to this | Hansard source

I thank the member for Lyons because the longer he spoke the more information he gave me to use as ammunition. Of course, the member for Lyons was speaking of those who may doubt the issue of global warming. It strikes me that the member for Lyons may be in that very same category. The issue that he has raised is the absolute unknown factors in relation to the Carbon Credits (Carbon Farming Initiative) Bill 2011 and related bill that we are discussing.

The coalition, as is well known by our government friends, support the idea of carbon sequestration in soil and various other attributes of farming carbon. What we do not support is simply accepting, in the broadest of terms without analysis, some proposition being put up by a government that has such a track record of failure. Anything this government was to suggest albeit, prima facie, quite reasonable, you would surely doubt the veracity of because the track record is there. We know it well but I will mention some of them again.

They had a great idea to save the economy and save energy by insulating ceilings, prima facie, a wonderful idea. It was an abject failure that burned down houses, cost lives and is costing taxpayers millions of dollars still to check where they went wrong. And we were promised this was going to be absolute lifesaver. School halls—wonderful monuments were built to the Prime Minister but at what cost to the Australian taxpayer? Where was the veracity? Where was the rigour? Where was the value for money? Totally absent. Solar panels—great idea for anyone totally ignorant as to how to select the best process of renewable energy. Photovoltaic cells seems to be a great idea—energy for free from the sun. Well it is not free; it is about six times the price of power generation by coal. That has been a failure and is starting to send state governments broke.

Then we had the issue of the cash for clunkers. That lasted a very, very short period of time. But, once again, it was a bright idea. I am sure the surveyed groups and the consultative groups that were listening to the public would have rushed to the caucus and said: 'We have another idea that is going to save the planet.' That did not last long. How are we, as intelligent members of this parliament, in this place to take seriously a proposition from the government—until we see the detail; maybe this Friday—and why would we for a moment accept that this is a good idea as it is presented? My experience indicates quite clearly that those on the land have a lot of commonsense and they are not easily fooled. They will not swallow glibly the ideas that are proposed by this government because lurking in the background is the knowledge that this government's reputation will surely result in this proposition being yet another failure.

We are being told that, of course, this is a panacea and this will be one of the tools in the box, so to speak, that will bring salvation and credit to this government. I am not going to hold my breath waiting for the time when the Australian public recognises that this government can save itself. Everywhere I go—and I accept I am from Western Australia and many recognise that we are slightly different—I hear the clamour of constituents for the cessation of this government and this government's policies that are impacting negatively on the people of Western Australia. Quite frankly, my great concern is for the people of Durack. They are my primary concern. They are tax-paying Australians and they deserve better than that that is being meted out by this government, especially when we are confronted with legislation that has no rigour whatsoever, not an ounce of real detail that will allow those people who might put this program into play—that is, the farmers of Australia, specifically in my case the farmers of Durack. They are wanting this government to give them some indication that there is an opportunity for them to contribute to the reduction of carbon dioxide in the atmosphere and, at the same time, use some of their non-productive land to turn a quid. Farming is a tough game these days. It is dependent upon so many externals. This might at best—as I said I will not hold my breath—be a salvation for farmers who are doing it tough and it may make some serious contribution to carbon sequestration.

There are so many holes and so many unknowns, yet we are being told that this is a great panacea. The member for Lyons, of course, raised the issue that it depends on the model. So much depends on the fine print of the final regulation that will be addressing the core of this legislation. Amongst other things we do not at this stage know even the starting point for the cost of a tonne of carbon. Therefore, farmers have no idea of the value of compensation for planting out hectares of non-productive country with trees. They know nothing about what the impact will be of some climatic event that will release the carbon that is contained in those trees.