Thursday, 8 September 2022
Treasury Laws Amendment (Electric Car Discount) Bill 2022; Second Reading
I'll continue on from where I left off yesterday. If we are to convince normal, everyday Australian consumers to start making the switch, we also need to ensure HEVs are included in any subsidies. The government has clearly not considered how working-class Australians will benefit from their proposal. As with all things, major changes take time. I therefore propose that, alongside the other vehicles included in this proposal, the chamber support my amendment to include hybrid electric vehicles, HEVs. These vehicles are not perfect; however, they emit, on average, 64 grams of CO2 emissions per kilometre less than petrol vehicles and 76 grams less than diesel vehicles. More importantly, they are affordable. It is therefore key that these vehicles be included in this legislation.
As it currently stands, vehicles expected to be exempted this year will equate to between 0.16 per cent and 0.4 per cent of new vehicle sales in the next 12 months. By 2024-25, this percentage of new sales is anticipated to rise to the range of 0.71 per cent to 1.8 per cent. This low level of sales demonstrates how small the impact of this bill will be in its current form. It is certainly not in line with the government's Driving the Nation program. Consequently, it is indefensible to not include HEVs on the basis that they will emit carbon. With these vehicles included, we will see a much smoother transition towards the uptake of EVs, and they will be participating in an eventual move to solely battery electric vehicles, BEVs, on the roads.
Furthermore, has the government considered the grid infrastructure required to support an increase in the uptake of electric vehicles? It seems that the government is proposing to walk before it can run. It is currently estimated that it will be at least a decade before the electricity grid can accommodate an electric fleet. And, in the short term, how is the government proposing to build the required number of charging stations? For those who travel long distances, do not have charging stations at their homes or are not charging their car at home every night, publicly available charging stations are a necessity. Currently, there is a confusing and convoluted structure of investment that covers local, state and federal spending. Whilst the government proposes to invest $39.3 million for 117 fast-charging stations, there is a lack of detail around the time line of this rollout and, more importantly, whether it will match or, preferably, precede a greater uptake in EVs. The solution to this in the short run is therefore hybrid vehicles, which have the capacity to drastically reduce emissions, compared to the current levels, and will not burden the grid or require charging stations. We need a transition period, and these amendments I'm putting forward will assist the transition period as well as making it available to many Australians.
Additionally, if we are to ensure that no-one is left behind in transitioning to a greener future, the Australian domestic industry, particularly manufacturing, must be the springboard. It must be Australian business and Australian workers that facilitate the building of infrastructure and the implementation of a renewable future. The government has committed to 604,000 jobs by 2030 as a result of transitioning to renewables. Only 54 per cent of these jobs are meant to come directly from renewable industries. Consequently, the bulk of jobs will come from those workers who support our renewable capacity: tradesmen, factory workers and manufacturers. In Fowler, for example, there are nearly 1,400 workers into the automotive industry. However, there is currently a real shortage of capacity and expertise in electrical component manufacturing. In its own Powering Australia plan, the government asserts that thousands of jobs will be created for construction workers. With investment, surely the same could be true for our manufacturing industry, as people upskill to meet the increased demand for production of electric vehicles and other renewable products, especially in an electorate like Fowler where unemployment is nearly three times the national average.
Furthermore, due to global supply chain shortages, the current wait time for an EV is roughly 12 months but could extend to up to two years. While it is good in principle to implement what the government has put forward, consumers won't reap the benefits of their EV for a long time to come. While it may be cheaper to fuel these cars once they have been purchased, this approach still requires the initial capital to purchase the vehicle and the charging capacity for electric cars to ensure they run efficiently for business needs. I commend state governments that have committed to rolling out fast-charging stations, with NSW planning to have 700 fast-charging stations rolled out by 2027. However, this does not help small businesses now, particularly those from low socioeconomic communities. Australia exports about 60 per cent of the world's lithium. Surely there is capacity to reboot our local manufacturing industry to build EV batteries. With a local manufacturing sector—in particular one based in south-west Sydney in my electorate of Fowler—we will no longer have to rely on a global car market that is already struggling to keep up with demand, which could see wait times dramatically reduce.
Additionally, we are presented with a unique opportunity to invest in our renewable manufacturing industry. Countries such as China with major automotive manufacturing industries are having to use mandate based systems that see the production of EVs incentivised, as it will take time for manufacturers to adjust. In Australia, we do not have this issue. If the government is serious about the uptake of EVs, investing in Australia's industry is an obvious and important policy. If the government seeks a truly sustainable future, thinking must extend beyond the top end—beyond the consumers of the final product. For real and effective affordability and sustainability, we need Australian manufacturing by Australian majority owned companies. Initially this may be focused on car manufacturing, but it can eventually be extended to buses and heavy vehicles as we build the capacity to manufacture them and their components onshore. I therefore ask the government to consider requiring that all government purchased vehicles at local, state and federal level be zero- or low-emissions vehicles manufactured in Australia using Australian made components and parts by 2035.
Further to this point, the government must also facilitate the purchase of all new commercial and government buses in metropolitan areas to be electric buses manufactured in Australia, as proposed by my colleague the member for Kennedy. What we see in the government's proposal is the minimum. We see the absolute minimum from this government in incentivising the uptake of electric vehicles. If they're truly planning to increase the number of EVs on the road, they have certainly not proposed how they plan to support such an uptake. Such a plan should include consideration for investing in our domestic manufacturing. I therefore implore the chamber to hold this government accountable for considering all Australians in their transition to renewables—not just those who can afford it—and support my amendment to the bill to include hybrid electric vehicles.
I certainly did not want to allow this historic opportunity to go by without making a contribution to the debate on the Treasury Laws Amendment (Electric Car Discount) Bill 2022.
It is an exciting time for the Australian people and, certainly, for this parliament. I was here in the 46th Parliament when you could barely utter the words 'electric vehicle', and I am overjoyed that we now have a government in place that is taking new technology seriously and has vowed to act on climate change, for which we have a very clear mandate from the Australian people. When the Minister for Climate Change and Energy introduced those bills, he filled my heart with joy—and not only mine. The people of Newcastle have long called for measures like these to be introduced because it is an unmistakable signal to Australian industry and also to the Australian people that we've got a government in charge that understands not just the human and social imperative to act on climate change but also the economic imperative to do so. We understand the economics of clean, cheap, reliable energy, and we recognise that generational imperative to act now. So it is incredibly important that this parliament gets to work.
This bill was introduced back in July—one of the first bills from the new Labor government—which indicates the seriousness with which we take this issue. The communities that I represent and, indeed, the communities represented by all Labor members understand clearly. Our communities have rejected the fear campaigns of the past now. I live in a city where all of our industries are very carbon intensive. I am home to the world's largest port that exports coal. My community knows full well the economics of energy. We've been doing it for more than a hundred years. We intend to be doing it for the next hundred years. They will be different forms of energy, however, and we will play a lead role in transitioning this country and in meeting our international obligations. It's communities like mine that have a lot of skin in the game that are going to lead this discussion in Australia, and it's governments like the Albanese Labor government that are going to provide the leadership to make these social and economic changes that are good for the planet, good for our people and good for the future.
We know that Australian businesses and industry are now desperate for some very clear indications and guidance about the risks of inaction on climate change. They're acutely aware of the risks. What they want is strong leadership and guidance about the pathways ahead, so everyone can get on with it. Indeed, I would argue that communities like mine have been way ahead of this parliament. Now they feel like they've got a government that's finally pulled its head out of the sand and is going to provide the kind of leadership that is required to ensure that people living in Newcastle and the Hunter aren't left behind.
We are about grabbing every opportunity available and leaving no-one behind, and that's what legislation like the bill before us now is going to present: new opportunities. This is one of those new opportunities that we can grab with both hands. Alternatively, you can do what so many members of the opposition do—turn their back, don't enter the debate, ignore, don't show up. We're not about to do that. We understand the imperative to be a responsible government in 2022. This bill is implementing an Albanese government election commitment to provide an electric vehicle discount by means of a fringe benefit tax exemption for eligible, employer provided electric cars. That, in a nutshell, is what this bill seeks to do.
The government is absolutely committed to reducing transport emissions. It's one of the big emission components that we do absolutely have to reduce, and we are making electric vehicles more affordable so that families and businesses who want them can get them. So many people are coming to my electoral office and saying: 'When is this going to happen? When can we start buying our electric vehicles?' They're desperate to get in on this game, and good on them. Those who are in a position to do so want to do their part. They need some help to make these electric cars more affordable. This bill, these measures, will deliver on that. As I said, it's a bill that will not only make electric vehicles more affordable for families but will also contribute to our climate change targets.
The bill will amend the Fringe Benefits Tax Assessment Act 1986 to exempt from fringe benefits tax the use of eligible electric cars made available by employers to employees. This fringe benefit tax exemption will apply to battery electric cars, hydrogen fuel cell electric cars and plug-in hybrid electric cars. Eligible electric cars will be limited to those first made available for use on or after 1 July 2022 and with a first retail price that is below the luxury car tax threshold for fuel-efficient cars. That is $84,916 for the 2022-23 component.
I expect there to be a big uptake on this. My community is absolutely ready. We are home to an electric vehicle festival. We have been doing this festival for more than a decade now. Just last week, I was at the University of Newcastle, farewelling a Tesla electric vehicle that is starting its journey in Newcastle. It will circumnavigate Australia in a project called Charge Around Australia. I was there to farewell, and send my good wishes to, Stuart McBain, the project director and driving project lead. He will be the person behind the wheel. It is an amazing opportunity for the university to incorporate all the smart things that it is doing in this area and take that car out to kids in remote and rural regions, who probably don't get to have a close-up experience of electric vehicles very often, so they can have access to the people who are building those technologies and talk to them about the science.
We know that children in Australia are anxious about their futures and what climate change means. I know members opposite also have concerns about the anxiety of children about their futures. One way of dealing with that anxiety is making sure that we provide great educational opportunities for those kids. I want to make sure that a kid at Yuendumu has got just as much chance as a kid sitting in Newcastle city of understanding this technology, of aspiring to be a scientist contributing to the technological solutions, of thinking about those problems that are ahead and being part of those solutions.
The University of Newcastle is very fortunate to have Professor Paul Dastoor, who has led the globe in producing incredibly cheap solar energy, where you no longer need sophisticated cells popped onto your roof or cars. He can literally paint the solar panel onto a plastic film, which is lightweight, incredibly cheap to produce and is printed on a 2D printer. That is what is going to help charge this electric vehicle as it travels around Australia.
We know there is range anxiety out there, and I heard the member before me speak to that issue. That is why Labor is committed to rolling out the 117 fast-charging stations that we are investing in along highways across Australia.
But there are other people playing a role in this as well. I congratulate the City of Newcastle Council, which is already rolling out charge stations in our city and region. I have community groups doing it, and the NRMA. There are a whole bunch of people who are way ahead of where the former government was at. They were already making efforts to get down this road and take opportunities with both hands, willingly and happily. The work that we will do to invest in those fast-charging stations will go in partnership with the NRMA, councils, the private sector and community groups who are also acting in this regard. That will go a long way to addressing those issues that people have around range anxiety, and I acknowledge that that's real. The project Charge Around Australia will educate and inspire some 70 schools along the way—how fantastic! They will get insights into the cutting-edge global technologies that are being produced here in Australia. They are being developed right in my city of Newcastle, and they are the sorts of technologies that will be addressing the climate crisis in Australia.
We are doing the heavy lifting because we know there's a lot at stake for communities like mine. I hope that events like Charge Around Australia and the work of Professor Paul Dastoor and the University of Newcastle inspire young minds everywhere to enter STEM. I want young girls from across Australia to be totally inspired to take up those STEM subjects, do those in schools and talk to industries about future career pathways they can have. They're going to be part of developing those technologies in the future as well—I know that. And that's why we are deeply committed as a government to provide new energy apprenticeships and new energy skills programs so those kids have got a bright future. That's what we want here.
This electric vehicle discount is just one of many measures now that the Albanese Labor government is putting forward in this parliament to make sure that we can honour our international obligations. We will honour that commitment that we have made both to the Australian people and to the world. We are serious partners in this endeavour now, and amending the fringe benefits tax to make sure that there are more affordable electric vehicles out there for families and for eligible employees is a great first step. It's one of many, many steps that we will be taking. For members opposite, who have dealt themselves out of so many conversations and so many important opportunities to be a partner in forging a better future, I really hope that there is some thought given to a better strategy in parliament. Instead of putting your head in the sand and pretending these things aren't happening, I urge you to work with government to ensure that we are offering the very, very best pathways forward.
I think it has to be acknowledge that this was a very clear commitment from the Albanese Labor government during the election. We absolutely have a mandate to implement this. There would be an outcry—and justifiably so—among the Australian people if this bill were not to pass through this parliament in both houses. It is certainly the way that the rest of the comparable democracies are travelling, and it would be a crying shame for Australia not to be taking part in ensuring that we make electric vehicles a more affordable option for the Australian people. We don't wish to become the dumping ground for all the vehicles that no one else in the world can sell. That's not the kind of future I want for my city of Newcastle. I'm pretty sure it's not the future we want to see for anyone in Australia. So I encourage all members of this parliament to get behind this bill and give it your support.
Might I start by saying that, if you live in Yuendumu, the last vehicle you would ever buy would be an electric vehicle, because you don't have the capacity to charge it in a way to give you the range—
A government member interjecting—
I didn't interrupt you, and you should be polite. There are a range of issues here. First of all, the market has been very aware of electric vehicles for a long period of time. In fact, a lot of the research for electric vehicles and batteries is done by 3ME in Armidale. They are then constructed from a chassis that's imported from Brazil—well, they're not constructed, they're just assembled, in Newcastle. The place they use those electric vehicles is down the coalmines that the Labor Party is intent on closing down. We also have electric technology in forklifts. We have electric technology, in a minor form, in scooters and in golf buggies. The market is very aware of this technology. It is not new.
The reason it hasn't taken off is that it's not appropriate to so many areas—that's why it hasn't. People aren't dumb. If they can make money, they'll go out and make money. They don't need any inspiration to make a buck. When we talk about the dumping ground, where do you think the dumping ground for electric vehicles is going to be because we don't make them in Australia? The dumping ground for electric vehicles will be Australia.
There are a range of reasons for not taking up electric vehicles, and I have to make the chamber aware of this. The first one is range. A Tesla has a range of about 470 kilometres. There is nothing wrong with that. It's just that it's way beyond the price range of people who live in a weatherboard-and-iron to be able to buy. The other thing is that, when you don't have electric fast-charging stations, and even with 117 fast-charging stations—Australia's a big place, the size of Western Europe. That means it takes about 27 hours to charge one from a house supply. What happens if you need to get to the hospital? What happens if your kid gets an asthma attack?
And the other thing is of course that people in poor areas don't have the money to buy new cars. If I go to the areas around me and the hills around where I live—I must admit I'm very humbled; at some of those booths I get over 90 per cent of the vote—I will not find a new car in that village. I will not find a new car in many of those areas. I'm proud of my people. It's just that they don't have the money to buy them. They don't have $60,000 to buy an electric vehicle. They work within a budget of around $10,000 to $20,000. And, if you want to test that, go and see the second-hand car lot and see what's moving, what's selling.
The other thing is they're just unsuitable. In the last two months of wet weather, I've had to use the winch on my Toyota three times: once for a funeral director who got bogged on the roads, once for a tray back that had slipped off onto the road—and it was the only way we could get in—and once for a small truck. Now, people say that's out of scope. Well, it's not. That's the life we live. That's what we do. And that sort of technology is not available in electric cars. In many areas it just would not be accessible, it would not be appropriate, and it'd get knocked to pieces.
The other thing about electric vehicles is that, when they're turned over, just like forklifts, they're basically worthless. That's the end. It's not like an HQ, a WB or an HJ Holden, which even decades later people are still using because they can fix them up. And the ideas, the technology and the nous to fix them up are seen through the local people. A lot of them have taught themselves. But the capacity to do that with electric vehicles is not there. So we're forcing on poor people literally another caveat, another cost, and we're saying to them—for a policy which, let's be frank, on the whole is a policy for white, urban, small upper-class areas in cities, where it's an appropriate car, because they're small distances and there's ample capacity to recharge. But that is not the case in regional areas. If you go to Yuendumu, you're not going to be using an electric vehicle. And that Tesla—and I've been reading about it—that's going to circumnavigate Australia is not going to Cape York. It's going to areas where it can recharge. And so, what you're saying, even by that statement, is that there are certain people you're going to isolate.
We, on this side, believe in choice. If you want to buy an electric vehicle, knock yourself out—buy it. And, if you don't want to buy it, then why is the government subsidising the actual people who could afford it the most? If you want to subsidise something, subsidise poor people into a vehicle, full stop. That's what you should be subsidising people into.
We've also seen those opposite talk about technology. You have to completely rejig the whole power grid to get the capacity for people in their homes to recharge their cars. You're going to need about six kVA per house, and they just don't have that. This is a massive cost to try and bring this into our nation. Even then, you're going to have periods of a massive peak in power at night, when there's no solar and less wind. You're going to have a massive peak in power and the inability for it to actually work.
Those opposite don't actually sit down and go through the nuts and bolts of this. When you come up with ideas, like wanting to go to zero emissions, and you need base-load power, rather than talking about how smart you are in manufacturing and industry—which I hope you are—why do you completely ignore nuclear power? You parody it. Why do you run it down? You say it's a stupid idea. So let's go through all the stupid countries that are currently developing, or are a part of, the small modular reactor industry and are going to get there before us: the Czech Republic, Romania, Argentina, Canada, the United States, the United Kingdom, France, China, Russia, Finland, South Africa, Egypt, the United Arab Emirates, Germany, South Korea and Qatar—all these dopey people, all these incredibly dopey countries, who are once more, in a new piece of technology—like mobile phones, like motor vehicles, like everything else—just going to leave Australia behind. And, ultimately, we'll end up with small modular reactors. It's just inevitable. It's like saying, 'I'm going to ban iPhones' or, 'I'm going to ban fridges' or, 'We're going to continue walking rather than using a motor vehicle at all.' It's going to come in.
Let's look at the dumb companies that are developing it: Hyundai, Hitachi, Westinghouse, General Electric, NuScale, Amec, Rolls-Royce, Skoda, Neutroelectric, KGHM. Do you think Rolls-Royce is stupid? Do you think Westinghouse is stupid? Do you think General Electric is a dumb company? Do you think they're doing this because they think it's a dumb idea? No, they're once more just leaving us behind.
Rolls-Royce is developing a 470-megawatt small modular reactor. It will power Leeds, a city of over 500,000 people—one reactor. The size of it is 16 metres by four metres—obviously the cooling capacity is there. Just think of that: 16 metres by four metres powering something the size of Leeds, and they believe they'll have it on the market by 2029. And the Labor government is saying, 'No, we're not going do that.' They giggle and make these foolish statements in the parliament, because they just haven't done their homework.
These are going to be factory-made; they're modular. With anything made out of modular parts in a factory, of course, over time they're going to get safer, cheaper and smaller. But our nation, with the Labor government talking about industry and innovation and being smart—well, they're not smart enough, nor are they courageous enough to see the bleeding obvious right in front of their face and be part of it. No, we'll get left behind. It'll be yet another product we import.
We had other statements—for instance, the Prime Minister said, 'You wouldn't bring a rock of uranium in here; please don't do that.' All that does is spell out how ignorant he is of it. Uranium-235 is about 0.7 of one per cent radioactive. To make it work, you have to upscale it. It needs to go to about four or five per cent to use in small modular reactor, and if you wanted it in a nuclear weapon you'd have to take it to 90 per cent, which is incredibly difficult. So, unless you intend to eat it, or break it down with nitric acid and inject it, then you've got no problems with it.
You should do a little bit more homework, rather than try to look like the most beautiful thing in the parliament. What we're seeing here is the Labor Party, once more, without the courage to lead, making us the dumb country—once more, the dumb country left behind. Even the AWU, from the right wing of the Labor Party, is in favour of nuclear energy. The CFMMEU is in favour of it, but not the Labor Party in Canberra. They're not in favour of it. They're left behind.
But here is Zoolander making his statement—such a beautiful man. He should get a bigger repertoire—and a bigger suit, because he is almost busting out of the one that he's got.
What we are seeing is this unfortunate capacity for us to be the sillier country as we see the rest of the world racing ahead. The most recent application approved by the United States was for NuScale's 77-megawatt small modular reactor, built in the factory. One of them would do Tamworth. People say, 'Where will you have them?' Where you currently have power stations would be the most logical position. So you don't have to build this myriad of transmission lines across the area.
The nuclear issue, believe you me, is vastly more palatable to regional areas than what is going on now. In the town of Walcha, 550 wind towers are going up around the town, turning it into an industrial park. It is the only thing you can find that will bring the Greens, the Nationals, Labor supporters and the independents all into the same room, basically saying, 'What is the inspiration to turn our area into an industrial park? It's not what we had in mind.' You need about 50 acres for one wind tower. Because it's an intermittent source, they are about 33 per cent effective and they commercialise out at around two per cent. So you would need about 20 wind towers, even if they were 100 per cent reliable. But, because they are not, you are going to need in the vicinity of 60 wind towers and more—in fact, some reports talk about hundreds—to take the place of one small modular reactor.
The NuScale reactor is 20 metres high and 2.7 metres wide. The Rolls Royce one is 16 metres high and 4.5 metres wide. They come in on the back of a truck and, when they are removed, they are moved out on the back of a truck.
Just a half of a point of order on relevance. In the advocacy for nuclear power, we have gone way beyond the bill. But, equally, it is only a half a point of order, because it is actually quite helpful to us, the more you want to talk up nuclear power and the idea of bringing uranium into the chamber. So you do you.
I take the interjection. The point of government is to lead. It is to find things and drive agendas. If all you want to do is be the caravan of polling, then we don't need a government; we can just do it online.
This area is pertinent. If you are going to go to a zero-emission process, there will be this huge requirement that is going to come onto the grid. Look at the peak hour traffic and ask yourself this question: when all these vehicles become electric—which is apparently what you want—how on earth are we going to charge them? They all go to work during the day—and maybe they will have charging facilities or maybe not—and then they go home at night and they are going to charge them up. How is that going to work? You don't have the capacity in the grid to do it.
As even AEMO is saying, we are on the edge of a collapse of the grid. We are on the edge of it not being able to deal with the issues, because our baseload is going off. You have to keep a grid at about 49 hertz for the capacity to stay up. If it goes down, it doesn't just go down for an hour; it can go down for days. If that happens—I think this is something we would both agree—politically, that would be a disaster. We have to make sure that we have the capacity to keep the grid alive.
If you want zero technology, the obvious baseload, zero technology is nuclear. All these countries are not stupid. We are the stupid ones. They are developing the technology, and they will be the beneficiaries. In the United Kingdom, they are looking at this bringing about $250 billion a year into the marketplace—and they want a bite of that cherry, but we do not. We don't make electric cars. We don't make motor vehicles anymore. We don't manufacture many things, and here we have the capacity to go into an area where you have high-paying technical jobs. But, apparently, we don't want to be part of high-paying technical jobs. We've got to import the electric cars and, in due course, we will import the small modular reactors.
It will be an absurdity if you go to Fiji or to Papua New Guinea and see them. You will be able to anywhere around the world and see them. They will be made in factories from South Korea to China, the United Kingdom, Finland, the United States, Argentina—Argentina is going around us—Romania and obviously France, and we're just going to be left behind. We're just going to be left behind, and we're going to be sitting in the chamber saying how stupid Skoda, Rolls-Royce, Hyundai, Hitachi, Westinghouse, General Electric, NuScale, Atkins, Amec and the University of Manchester are. All these other people apparently are so stupid, and we're here saying, 'Oh, no, we're so smart.'
That was a treat. I'm glad I arrived early. It was an interesting mix of facts and fiction. It's kind of peak irony, isn't it—having the member for New England here talking about 'making foolish statements in the parliament'. That's a direct quote. I was listening carefully. I think he said the electricity grid is close to collapse and we're a dumb country because we don't make cars here anymore. If only you'd been in government for the last 10 years, you might have been able to do something about this! What happened to the car industry? They were chased out of Australia—bye, bye, car industry. I think that was your government, Member for New England. The point of a government is to lead, apparently. This is what he told the chamber just there: the point of a government is to lead. If only he'd been in government for the last 10 years and could have done anything about all of these problems! I think, Minister, you walked in just as he was explaining to the parliament that it's really not such a dumb idea to bring uranium into the chamber. It's just like a lump of coal. The two are the same, and that would be fine.
Just when you thought the Libs couldn't get any weirder—even putting aside that contribution from the National Party—they do this: the party of tax cuts is here to oppose a tax cut on electric vehicles. It proves, I think, the point we heard yesterday in question time. There were a few good points made yesterday in question time. They are really the party of dregs and leftovers from the previous government. There's a pattern, isn't there? Just in the first few months since the election, they refused to turn up to the Jobs and Skills Summit. They oppose at every turn clean, green, renewable energy to put downwards pressure on power prices. They pretend that secret ministries don't really matter. If you thought that they were weird, there are other secret ministries—the strangest thing since Sir Prince Philip.
This bill to cut tax on electric vehicles—the Treasury Laws Amendment (Electric Car Discount) Bill 2022—is good for motorists, it's good for employers and it's good for climate action. The FBT exemption will apply to battery electric cars, hydrogen fuel cells and plug-in hybrids, with savings of up to $9,000 a year. I think it's $4,700 if you're buying it as an individual with salary sacrifice or novated leases.
I had correspondence about this bill. It was one of the first things in the first sitting week of parliament. Booran Motors, a local business, emailed me and said: 'Is this election promise going to happen? When are you going to do it?' I said, 'Well, I've got a good answer for you: we're introducing a bill into the parliament today.' They said, 'Is it going to pass the parliament?' I made a mistake. I said to them, 'Well, I'm sure it'll pass the parliament,' because I couldn't imagine a world where the opposition, the party of tax cuts, would oppose a tax cut on electric vehicles. But I'm going to have to contact Booran Motors. I visited them a couple of weeks ago to have a chat to understand. They got out the schedules. They explained how their novated leases work. They showed me the flow-through calculations, and actually the calculations they had were more optimistic than yours. They said it's going to incentivise employers and consumers to choose electric vehicles. So I apologise publicly for misadvising them, thinking that the opposition might support a tax cut on electric vehicles.
For the last decade, we've had this failing Liberal government actively working to hold Australia back and stop us embracing the future. They were running these disingenuous fear campaigns while the rest of the world raced ahead. Electric vehicles, according to the former Prime Minister, were going to end the weekend. No-one would be able to tow a trailer. I learnt something else from you in question time yesterday, Minister: the Deputy Leader of the Liberal Party told Australians on radio, very firmly, that there was no firm in the world that manufactures electric utes. Well, that's not true, is it? To quote you, Minister, there are just a few small boutique firms: Mitsubishi, Ford and General Motors.
A government member: Startups!
Startups—that's right. Anyway, I'm sure she'll walk in and correct herself. But Australians understand far more than the opposition. They understand that electric vehicles are the way forward.
But let's be frank, with a couple of comments. Australia is currently the dumping ground, disgracefully, for the world's most polluting cars. As the member for New England reminded us, we don't make cars here anymore, because the former government chased them away. But the multinational car manufacturers dump their most polluting vehicles in Australia, and that's because we're the only country in the OECD that has no fuel efficiency standards and none under production. There's one developed country, I think, which is Russia, that also has no fuel efficiency standards, but it got kicked out of the OECD. So it's such illustrious company that we're in!
We are the dumping ground.
Too many Australians who are trying to buy an electric vehicle quickly at the moment can't get one quickly. There's not enough supply. We've been left behind because of this low intake, because there's no incentive for the manufacturers to send their cars to Australia. Why would they? They can keep selling polluting vehicles that no-one else in the developed world will buy now. That's the reason that Australians can't get a supply of electric vehicles. Frankly, we're a pimple on the backside of the global car market, and there are no proper incentives for them to increase supply, because we're a small market, we're a right-hand-drive vehicle market and, as I said, we have the worst vehicle emission standards in the developed world. So just keep sending 'em along! It's illustrious company, isn't it? That was possibly your finest moment in question time—'nyet zero'—thank you, Minister! But the hard reality is we are largely irrelevant to the major car manufacturers, especially at the moment, with the global supply chain difficulties, which affect everyone, but that's then compounded by the lack of fuel efficiency standards and our terrible policy settings.
Now, the manufacturers won't say it like that; they're very polite people. They'll nod, they'll talk about delays in chips and they'll say, 'It's a very tough world out there, and we're doing our best.' But that is the fact. That is what the industry bodies will tell you. That is what the industry analysts will tell you. It doesn't matter how polite the manufacturers are; until we fix our policy settings and provide some proper incentives for them to change their behaviour and send more electric cars our way, we're not going to get them. Australians are not going to be able to get the clean technology that will cut their fuel bills or remove their fuel bills, depending on the technology they choose. That is the cold hard truth. So we're going to need a range of policy changes to embrace the future and make sure that Australians can access clean technology and electric cars more rapidly.
This bill is therefore one contribution. It's not the whole answer. We had a whole list of problems from the member for New England and other opposition speakers as if they hadn't been in government for the last 10 years. Well, they weren't the government for the last 10 years; they were just parading around in the white cars and occupying the offices. They didn't do too much governing. But more work is needed.
The electric vehicle discount in this bill is just one key part of the government's Powering Australia Plan which will help to reduce emissions targets by 43 per cent by 2030 and net zero by 2050. In addition, this government will continue to provide the infrastructure for electric vehicles. In answer to some of the legitimate queries that were raised—the thing is it's all problems, no solutions. Those opposite spent 10 years talking down the future, avoiding the future, trying to pretend that that wasn't where the world was going, instead of preparing Australia for the future and bringing us there. So there's $500 million to the Driving the Nation Fund to establish 117 fast-charging stations on highways at an average interval of 150 kilometres—that should deal with range anxiety; it's well within the range of all electric vehicles—and to create a national hydrogen highways refuelling network.
There are also the vehicle emissions standards. The vehicle emissions standards will play an essential role in transforming Australia into a globally competitive market for electric vehicle intake. Australians are currently paying more for petrol and getting less value for the petrol that they're buying than drivers overseas because we don't have those fuel efficiency standards. Now, we do need to be careful and sensible about how this is done. We've got no choice but to take into account those supply constraints globally and make sure that, as we bring in fuel efficiency standards, electric vehicles will be available to avoid price shocks. That's something that the industry bodies are talking about to those who are interested in these things. This can be done, though, and it can be done sensibly, and we don't need to succumb to idiotic scare campaigns like those run by the previous Prime Minister and, indeed, the now opposition—the dregs of the previous government.
Overseas, there are a range of different incentives for manufacturers. I suppose the only good thing I could say about the fact that we're last in the developed world, the fact that we're the only country in the OECD not to have fuel efficiency standards—the only positive, if we want to put a positive spin on it—is that we have the opportunity to look at what other countries have done, to get there in the most efficient way and make our policy settings the best in the world, informed by everyone else's experience: who's got it right and who's got it wrong.
So I'm glad that the government is undertaking a proper, considered policy process—something alien to the former government. You just stood up and announced stuff because it felt good and it seemed like a good idea and you needed to have something to fill the daily media cycle. You announced stuff. It didn't matter whether it made sense. It didn't matter whether you delivered it. You just announced more stuff. You certainly didn't consult on it or write a discussion paper, put it out to the public and have a proper process—talk to industry, talk to government departments. You didn't do that. Well, that's what we're doing. So I'm delighted that the minister is running a proper policy process. Adult government is back, in the style of Hawke and Keating—governments that ran proper policy processes and exposed themselves to criticism. There will be a discussion paper out within the next month or so, I think, and the policy process will continue.
Finally, I just want to acknowledge the strong community support in my area and the work of the South East Councils Climate Change Alliance—councils right across south-east Melbourne who have been advocating for exactly the things the government speakers have been talking about. This bill is good for motorists, good for employers, good for climate action, and I encourage the opposition to get on board.
Much as I like and admire my colleague the member for Bruce, there was much in his contribution—he would be unsurprised to hear—that I disagree with. One of the things I find interesting in this whole debate is the lack of willingness to dig down into the detail of how we actually get to this point. I'll make the observation at the outset that I have no issue with electric vehicles. As the member for New England said in his contribution, if you want to go and buy an electric vehicle, knock yourself out and go and buy one. But I have many, many people in my electorate of Forde who would not even think about buying an electric vehicle, because they cannot afford it. They work in jobs where salary sacrificing and even discussion of fringe benefits is not an option. They wouldn't know what a novated lease or a salary packaging plan is, because they just do not work in industries or in jobs where those opportunities are afforded. So how are they going to benefit from this policy? They are not going to benefit.
The worst thing is, if we continue to go down this road and we continue, over time, to increasingly restrict access to internal-combustion-engine-powered vehicles, and second-hand models of those vehicles, as a consequence, become more expensive, for people on low to moderate incomes in my electorate, their cost of living is not going to go down; it is going to go up, because they will have to pay more for the vehicles that they can afford to buy or that they will increasingly struggle to buy. And increasingly, I would argue, they are going to pay more for fuel for their vehicles. These people will not benefit from this policy. And, at the end of September, this government is not going to continue the fuel excise discount that we instituted when we were last in government. So people in my electorate who are on low to moderate incomes are going to pay double. They're not going to benefit from this policy, and they're going to pay higher fuel prices from the end of September. So is it any wonder that we on this side of the House stand here and debate the merits of this policy? It's our responsibility to debate the merits of this policy, when people in electorates like mine and those of my colleagues across this country are going to pay the price of this policy.
I would go further and touch on some other claims that were made by the member for Bruce in relation to pollution and the impacts of internal combustion engine vehicles. I've been round long enough to have seen the massive improvements we've made in the last 30 or 40 years in the level of pollution that comes out of our vehicle fleet, whether it is our cars or our trucks. I can remember many an occasion, driving from Beenleigh into Brisbane, when you couldn't see the skyscrapers in the city of Brisbane because of the smog, because of the pollution. I can't remember when we last had a smog day in Brisbane because of pollution from motor vehicle exhausts. For that matter, I can't remember that happening in Sydney or Melbourne. Do we still have days with smog from bushfires and fog and other things? Yes, we do, but the incidence of those events as a direct result of vehicular pollution today are extraordinarily rare, and that shows me that we as a nation over the past 30 to 40 years have done an extraordinary job in improving the air quality and emissions standards from our vehicles.
The other thing that I find interesting in this debate about providing subsidies to electric vehicles is we seem to have gone into an age of subsidy for a whole range of things. As I look back through history—because history is a wonderful teacher about what we can do better or do differently—I question the need to subsidise electric vehicles, because we never subsidised the Model T Ford—
I take the introduction from the Treasurer, who might know. It is a subsidy because it's a tax cut that's not being applied more broadly. We didn't subsidise the iPhone, we didn't subsidise computers—we didn't provide tax cuts on those, if the Treasurer wants to go down that road. I find it increasingly strange that we have to continue to provide these subsidies—or tax cuts, as the Treasurer wants to put it—for new technology when historically we've never had to do that. The market will take care of these things itself as people take the opportunity, and that's why we don't need to take this step.
As I said in my earlier remarks, before the Treasurer got here—and he has many people in his electorate in the same socioeconomic situation as mine—they will not benefit from this because they do not work in jobs where they get fringe benefits tax or salary sacrifice arrangements. At the same time, their fuel costs are going to go up from the end of September, and the Treasurer has had nothing to say about that whatsoever.
The tradespeople across my electorate and those who are self-employed will not get the benefit from this, and I'd like to know how that's going to benefit them.
What is also not spoken about is the impact of this on the electricity network and the capacity for the network to accommodate the increased usage that a greater take-up of electric vehicles will cause. The government have said they're going to invest in the electricity network, but all of that investment comes at a cost. It is a regulated asset, which means a regulated return to those investors, which all reflects in your electricity bills. We might have a saving on one hand of $5,000 through a reduction in the fringe benefits tax, but what are we going to pay in increased electricity bills as a result of this additional investment and the regulated return that that will require on those investments?
As I look at this bill and all of the actions that those opposite are taking where they are proposing to reduce the cost of living for everyday Australians, I fail to see how that's actually going to be achieved. Through their policies, they are going to increase the cost of living, not reduce the cost of living.
I'll keep my contribution short to allow the Treasurer to make some closing remarks. I want to follow up on an opinion piece I wrote in the Northern Territory News recently about fuel gouging in the Northern Territory and introducing our electric car discount, which will remove import duties on electric and low-emission cars. This is one part of our plan to reduce emissions and cut power bills by investing in renewables. The electric car discount will reduce the upfront and ownership costs of electric vehicles, addressing a significant barrier to their uptake. Our government is committed to reducing transport emissions and is making electric cars more affordable for the families and businesses that want them, including in the Northern Territory. That's why our government is tabling this bill, fulfilling our election commitment of providing an electric vehicle discount by means of a fringe benefit tax exemption for eligible electric cars that are provided by employers.
Currently, the fringe benefits tax is payable when an employer makes available a car, including electric car, for private use of an employee. The amendments in this bill exempt from the fringe benefit the use of eligible electric cars made available to employees or those who take up a salary sacrifice arrangement. This exemption will apply to battery electric cars, hydrogen fuel cell electric cars and plug-in hybrid electric cars below the luxury car tax threshold for fuel-efficient cars of $84,916 for all vehicles made available for use after 1 July 2022. I welcome these changes, which will ensure that employers providing employees with an eligible electric car will not pay fringe benefits. This is an important measure that will help increase the uptake of electric cars in our nation.
These policies are urgent, not only because they are fair to future generations, whose lives will be severely impacted by how we respond to climate change in coming years, but also because they will help Australians, who are facing such strong cost-of-living pressures at the cash register and in their bills. What we have seen in the Territory is fuel retailers gouging, and I am committed to continue putting pressure on them to be fair and honest with Territorians about the massive profits they are making, whilst our government also moves us towards a renewable energy future with this electric car discount.
I thank the House for the opportunity to update my constituents. Around the country we have seen that people want to embrace electric vehicles. Not everyone will want an electric vehicle, and that is fine, but more and more people will see that this is the way of the future and that it will result in cheaper bills. I commend the bill to the House.
Thank you very much for the opportunity to sum up the debate on the Treasury Laws Amendment (Electric Car Discount) Bill 2022. I want to genuinely thank members from all sides of the debate for their contribution to it. As we know, the bill amends the Fringe Benefits Tax Assessment Act 1986 to provide a fringe benefits tax exemption for eligible electric cars that are made available by employers to employees—so, in effect, a tax cut to make electric vehicles cheaper and also to boost the supply of electric vehicles in our network. The exemption applies to battery electric cars, hydrogen fuel cell electric cars and plug-in hybrid electric cars that are below the luxury car tax threshold for fuel efficient cars. The exemption will apply to fringe benefits arising from the use or availability of an electric car from 1 July this year, provided the car was first made available for use on or after that date. Employers providing employees with an eligible electric car will not have to pay fringe benefit tax on that car, and the cost to employees of entering into salary-sacrificing arrangements in order to lease the car will now be less than it previously would have been.
This bill does implement an election commitment from the Albanese government. It's just one part of a much bigger plan to improve the uptake of electric vehicles in Australia, with further measures to be delivered as part of the National Electric Vehicle Strategy, which will be laid out by the Minister for Climate Change and Energy, and the minister for transport and others will have input into that strategy, as will the public, of course. The strategy can also consider matters beyond the scope of vehicle fringe benefits and beyond the remit of this legislation that we're considering today—things like charging facilities and other important parts of getting the EV ecosystem right in Australia. The fringe benefits tax exemption will be an ongoing measure, but it will be reviewed after three years, just so that we can make sure that it remains effective and it's doing the job that we want it to.
This is a significant signal that Australia now has a government that recognises the economic and generational imperative of acting on climate change. It is disappointing but not especially surprising to hear that those opposite don't support a tax cut for electric vehicles, which would bring down the cost of living and also incentivise the types of cars we increasingly want to see on our roads so that we can take climate change seriously but also take the cost of living crisis seriously at the same time.
This is a government that understands the opportunities of acting on climate change and of cleaner and cheaper energy and low emission cars. We intend to grab those opportunities for the benefit of the Australian people. This measure we're talking about today is good for motorists, employers and their workers, and it's good for the environment. All of that makes it good for our country as well. That's why I commend the bill to the house.
The original question was that this bill be now be read a second time. To this the honourable member for Hume moved as an amendment that all words after 'That' be omitted with a view to substituting other words. The honourable member for Kennedy has moved as an amendment to the amendment that all words after 'Whilst' be omitted with a view to substituting other words. The immediate question is that the amendment moved by the honourable member for Kennedy be disagreed to.
Question agreed to.