Senate debates

Thursday, 14 November 2013

Governor-General's Speech


1:51 pm

Photo of Ron BoswellRon Boswell (Queensland, National Party) Share this | Hansard source

It is interesting that I am following Senator Di Natale with a completely and utterly different message. Senator Di Natale was an excellent doctor but that is where he should stop. There has been a lot of talk in this chamber and in the other chamber about carbon tax and about everything Australia will gain by scrapping it. We will be better off by $8 billion a year. Households will save an average of $550 a year in 2014-15, but there is more we can do and there is more we should be doing.

There is another green impost that has put up electricity prices for businesses and households almost as much as the carbon tax. Like the carbon tax, it is doing nothing to lower carbon emissions and has served only to lower electricity use by unprecedented levels. Like the carbon tax, it has no end in sight in the immediate future. Of course, I am talking about the renewable energy tax. I will pick up the fact that Tony Abbott, the Prime Minister, said that he will send that to a review. He said that this week, so it does give us a lot of hope. The RET is on track to cost $5 billion by 2020. Around one-fifth of the average household electricity bill will come from it. It has already put up power prices for industry to such an extent that manufacturers are shutting down and moving overseas.

Voters have spoken loud and clear on the carbon tax. They never wanted a carbon tax. In this election they threw their support behind the parties that promised to scrap the carbon tax. I am sure that, if the full repercussions of our forced investment in renewables were put out there, public opposition to the RET would be just as loud and just as strong. As with other countries that have invested in renewables, Australia is now suffering from one of the highest power prices in the world. Industry has had to shoulder much of the renewable burden. Electricity costs for industry in Australia are now over double that of many countries. Our manufacturers are being hit for six. Take one Queensland based manufacturer that pays $108,000 every month on his electricity bill. Of that, $15,000 comes from the carbon tax and $8,000 comes from renewables. That is $180,000 a year from the carbon tax and $96,000 from the RET. That is 13.8 per cent of their power bill that is tied to the carbon tax and 7.4 per cent that is tied to the RET. This reflects the typical green impost placed on companies around Australia. I have seen some businesses where the carbon tax makes up 18 per cent of their power bill and the RET makes up 13 per cent. So while repealing the carbon tax would cut 13 to 18 per cent of a business's electricity cost, getting rid of the renewable target would bring that up to 20 to 31 per cent. That is a huge difference.

With the diaspora of businesses from our shores to countries with less harsh or no green impost, every bit of relief we can bring to our industrial sector counts. Look at how tough our manufacturers are doing it. We have seen over 140,000 jobs disappear since the start of 2008. That is almost one in every seven jobs in manufacturing that has been lost. Our food and beverage, grocery and fresh produce sectors lost 170 employers and 1,000 workers in 2012 and 2013. That is 170 factories shutting down. The last months have seen a string of closures and moves offshore in the manufacturing and food processing sectors. McCain said it would close its processing plant in Penola, South Australia, leaving 59 employees without work before Christmas. The Greens would rejoice in that. Simplot announced that it was downsizing its Bathurst plant's operation, costing 110 jobs. It made the point that operating costs for its competitors in New Zealand are substantially lower. The Greens want to put them up. Golden Circle, the icon of Queensland, said it would be closing its Mill Park plant in Melbourne, which was no longer viable, and moving production to Queensland. That is 123 jobs lost in Victoria. Downer EDI announced that it would be closing its rail manufacturing plant in Bathurst at the end of the year, putting 100 employees out of work, but the Greens do not worry about that. They do not worry about the people having to foot their bills on the dole. They can eat lettuce! Electrolux, which runs the largest refrigerated manufacturing operation in Australia, said it would shut down its factory in Orange in 2016, costing 500 jobs. It said during the announcement that it was more cost effective to manufacture in Asia and Eastern Europe. They are not putting any carbon price or any renewable energy target on. Give them a star! The mining equipment maker Caterpillar announced it was shifting 200 jobs from its plant in Burnie, Tasmania, to Rayong in Thailand. That should send a shudder down the spine of every Taswegian in the Senate and in the other place. Two hundred jobs is the equivalent, probably, of 20,000 jobs in Sydney, but the Greens do not worry about that; they would rejoice in it.

Let us take a look at the other manufacturing casualties. There are Cresta, Cussons, Aerogard, Harley Davidson, Bosch, BlueScope, Boral, Amcor, Penrice Soda, Norske, Skydome—that is one for you, Senator Whish-Wilson—Caltex, Shell, Goodman Fielder and Queensland Aluminium. Between these companies alone, more than 4,500 jobs have gone. What a great victory for renewable energy and the carbon tax. It is a killing field out there. Let us look at SPC Ardmona, which is barely holding on in the face of cheap imports from countries that have no carbon tax and little or no renewable impost. If SPC does not find its feet that will be another 2,050 jobs gone, plus all the farmers who are going to hang off that. It is a killing field out there for manufacturers. I am not placing the blame for the Australian manufacturers' woes on the carbon tax and the renewables, but they certainly have played their part in tipping businesses over the edge.

Look at the well-documented struggles of our car manufacturers. Ford has committed to closing down its factories by 2016. Holden is headed the same way. Their plants are losing millions a year. It is estimated that the carbon tax and the RET alone put around $600 on the manufacturing costs of a car. Holden's plant is set to lose $18 million a year. That is $270 per vehicle, even after the massive subsidies they receive. Would it not be better not to further subsidise Holden to that amount but to get rid of the policies that are costing $600 per car? Getting rid of the carbon tax will do a lot to lower the cost of electricity for industry, particularly for those hardest hit—the aluminium smelters, the manufacturers and the food processors that are shutting down and shifting overseas because they just cannot cope with our input costs. Scrapping the renewable energy target would do a lot more to ease the pain. We can no longer stick our heads in the sand. The fact is that the annual renewable energy target will only go up as we move closer to 2020. The number of large-scale renewable certificates that companies will be obliged to surrender will increase and the dent the RET will leave in their power bills will grow bigger and bigger.


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