Senate debates

Tuesday, 11 February 2014


Climate Change Authority (Abolition) Bill 2013; Second Reading

6:25 pm

Photo of Alex GallacherAlex Gallacher (SA, Australian Labor Party) Share this | Hansard source

I continue my remarks on the Climate Change Authority (Abolition) Bill 2013 from just prior to question time.

We had a situation where an election was basically run and allegedly won as an adjudication of climate change—whether there is climate change, whether there is global warming and whether the solutions of the previous government were correct, or if the incoming government had the right strategy. A brief look at the incoming government's strategy in respect of climate change was that they would plant more trees—or plant lots of trees—and that they would pay polluters to pollute slowly.

In amongst the incessant negativity that emanated from the other side during the whole term of the Labor government and, increasingly, towards the election timetable, it was 'Climate change, carbon taxes: bad, bad, bad, bad'. Basically, the scientists were not reputable or their views were that of zealots.

It was Senator Whish-Wilson who first raised in this chamber the reinsurance industry. It is really interesting to go and look at not the zealots of the world but the reinsurers of the world. There are probably about 10 reinsurers in the global sense, in a very large way: Munich Re, Swiss Re, Berkshire Hathaway Inc. and the Gen Re group, Hannover Re Group, Lloyd's, SCOR, Everest Re Group, PartnerRe, TransRe and ACE Tempest Re Group. These are reinsurers with a global reach, and they all make clear, unequivocal comments. Munich Re has stated:

Climate change is a subject that concerns us all. It is one of the greatest risks facing mankind. In recent years, Munich Re has actively supported and advanced climate protection and adaptation to global warming.

This is a company that since 1973 has had a strategy, not born out of philosophy—although I hesitate to denigrate their motives in any way—but basically born out of experience and practicalities. They reinsure risk.

There have been catastrophic storms in the US and they cost lots of money. They cost billions of dollars. As I said earlier, Swiss Re, representing 722 investors who hold some US$87 trillion worth of assets, is seeking to insure those assets. These are the people who do that, so they are working from years of history, they are working from actuaries, they are working at reducing the carbon footprint and they are working with global companies which understand this problem.

The challenge in this debate is to get over the opposition to representing the best interests of the Australian population and the best interests of future Australians in terms of economic damage and climate change damage, and we do not see any signs of that. Planting more trees and paying polluters to pollute slowly is not a coherent national strategy for dealing with a global position.

I can understand the politics of it. I personally am very challenged at the impact of the carbon price on a lot of sectors in our economy. But what you cannot do is forgo the national interest and pretend to act for one sector only and pull the wool over everyone else's eyes. Basically, the reinsurers of the world, representing billions of dollars worth of reinsurance, believe that climate change is real, that it is happening, and that, unless there are strategies to mitigate global warming, it is going to get much worse.

Any government that goes ahead with a strategy of simply planting more trees and paying polluters to pollute slowly is not in the ballpark. All of the economists and all of the economic advice is that if you want to change behaviour you have to put a price on that behaviour. No economic strategy to pay people to pollute slowly will be effective. It is simply the case that we need to change behaviour, and that is extremely challenging for lots of us on this side of the chamber, too. But the strategy we have at the moment is for more trees and paying people to pollute slowly. It flies against all of the evidence. I urge Mr Abbott and his team to reconsider.


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