David Johnston (WA, Liberal Party, Shadow Minister for Defence) Share this | Link to this | Hansard source

I move:

That the Senate take note of the answers given by the Minister for Climate Change and Water (Senator Wong) to questions without notice asked by Senators Johnston, Birmingham and Cameron today relating to the Carbon Pollution Reduction Scheme.

During question time, the Minister for Climate Change and Water, Senator Wong, accused the opposition of talking down the economy. After the first six months of the current government, the Treasurer declared that the genie of inflation was out of the bottle, so I find it quite ironic and indeed rather fatuous that the minister would shout across the chamber that we in the opposition are talking down the Australian economy while she is seeking, through the premature introduction of an emissions trading scheme, to physically demolish the economy of this country. She also said across the chamber—and, quite interestingly, further disclosing her attitude—that she is going to hold the opposition to account on various matters. In relation to an emissions trading scheme, there is only one person who needs to be held to account here, and that is of course the minister. Throughout the formulation of this policy, and indeed during all of the negotiations leading up to this point, the minister has been completely arrogant and dismissive of the needs and concerns of business. Today—and I refer to the questions that I asked her—we have seen some 1,500 casual construction jobs and 150 permanent jobs with Alcoa in Western Australia being declared as abandoned by the Australian Workers Union. This must be a concern for any politician, in particular any senator giving reasonable and decent consideration to public policy in this place, yet the minister is completely oblivious to it. She seems to give no heed to or show concern about any of these such matters.

I have also tabled the Nyrstar press release which sets out that Nyrstar, as a zinc smelter in both Port Pirie, in the great state of South Australia, and in Hobart, in the great state of Tasmania, employs approximately 3½ thousand people. The minister gives not a jot for those people. She is ideologically predisposed, and transfixed in her timing of the implementation of this policy. The opposition believes that Australia must be part of a global response to reduce emissions. The coalition considers that an emissions trading scheme should commence when it is ready and in an orderly, methodical and responsible manner. It should enjoy the broad support of Australian industry and it should protect vulnerable Australian households. It should commence not before 2011, and probably by 2012. The design detail of an Australian emissions trading scheme must be informed by the outcome of the Copenhagen meeting at the end of 2009. There is no point in us castigating ourselves economically, particularly in the face of this global financial crisis, if the rest of the world is not with us. If no action is under way, Australia must start its emissions trading scheme with a very low price and it should proceed with a very slow trajectory. That is the opposition’s position.

Mr Rudd and his government need to be, and are, upon notice that we will sign no blank checks on Australia’s future and that we will not support a scheme that will disadvantage Australia’s national interest and competitive advantage. Nyrstar puts out exports into the world zinc market worth $2 billion and today, when penalised—and they used the word ‘threatened’—they have been forced to come out, put their head above the trench in the face of this government’s ideological predisposition, and say, ‘We will not survive if this is done incorrectly.’ Everything we have seen to this point tells us that this scheme is not going to be put into action in a responsible manner.

Our position is clearly supported by Heather Ridout. She describes the modelling as a Doctor Who, Tardis arrangement. She said:

For example, if the US does not become part of a scheme, it doesn’t model the adjustment costs …

It’s like a Dr Who, Tardis arrangement where you get in at 2010 and come in a 2020 with the nirvana of a whole lot of new industries established.

Companies and individuals don’t just move around like that. The costs are painful, they’re quite substantial.

That article went on to say, ‘The Treasury modelling showed that some coal-fired power stations would be forced to close.’ Yet the minister does not listen and does not care about these jobs. This policy is, potentially, in a shambolic state under her stewardship.

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

It is quite clear that the opposition have learned nothing about climate change. Their own position, of course, has not changed since prior to the last federal election. The fact is that, notwithstanding those pious words about concern for climate change and a commitment to doing something about carbon reduction, the opposition, when in government, refused to really accept that there was a problem. We know this. The former Prime Minister, Mr Howard, was a climate change sceptic. He was probably one of the leaders of the climate change sceptics in the world. He slavishly followed the position of President Bush. Australia, virtually alone in the world, stood with the US administration at the time in not being prepared to accept that this was a real and significant problem. And of course their position, in the face of all of the overwhelming scientific evidence and the evidence of what was happening and being done in the rest of the world, was ultimately judged by the Australian people as not being up to the mark in dealing with the great challenge of climate change.

I note that president-elect Obama has embraced this as an important issue. I believe that the next US administration will move to a leadership position on the issue of climate change, in contrast to the position that the previous administration held, up until the 11th hour, at the conference in Bali last year. The Rudd government’s very first action was to sign up to the Kyoto protocol, something for which we were condemned up hill and down dale as meaning the end of the Australian economy. We were told that it would cost millions of jobs and that it would destroy the fabric of Australian society and our economy. That was the opposition’s mantra in government and not much has changed. What the opposition has done now is grabbed hold of the financial crisis affecting the world. It is now trying desperately to use that as an argument in order to enable it to say, ‘Let us back off on climate change as an important issue. Let us back off on moving towards the establishment of a carbon pollution reduction scheme.’

I listened carefully to what Senator Johnston said about the opposition’s commitment and the opposition’s time line, but I doubt that it is genuinely the position of most of the opposition. We know that they are, essentially, sceptics. The opposition’s position is that at the end of the day they really do not want a carbon pollution reduction scheme. They do not want an emissions trading scheme. And this is despite the fact that, as the minister pointed out in her answers, just about every nation in the rest of the world accepts that this is the way to go. It is part of an overall package of measures that has to be adopted, measures that include promoting the movement to cleaner coal production and promoting research and development into cleaner energy fuel sources—the whole suite of measures that I do not have time to go through at this point. A carbon pollution reduction scheme is, of course, an inherent part of that process.

It is sad that the opposition cannot accept that we have to tackle climate change and that the fact that we have an economic crisis confronting the world at the moment does not mean the issue of climate change should be just taken off the agenda. We have to move forward on both these critical challenges and seize the opportunities for investment in clean energy. It is what, for instance, our package for the vehicle industry is about: it is assistance to that industry to meet the challenges they confront in the economic situation, but going hand in hand with that is the obligation on them to invest in cleaner and more fuel efficient cars. (Time expired)

Simon Birmingham (SA, Liberal Party) Share this | Link to this | Hansard source

I rise to take note of the responses given by Senator Wong in question time today, particularly to questions from Senator Johnston and me. Last week Reserve Bank of Australia board member Warwick McKibbin urged the government to delay the introduction of the emissions trading scheme. He did so based on the uncertainty that exists as to how the rest of the world will react. His comments were derided by the Treasurer, Mr Swan, who said:

He must have a crystal ball if he knows the outcome of the international negotiations.

The question today is: where are Mr Swan and Minister Wong hiding their crystal ball? Quite clearly they think they know the outcome of the international negotiations—or that would appear to be the case from the responses Minister Wong gave today and from the detail that underlies the Treasury modelling into the so-called Carbon Pollution Reduction Scheme.

The minister today told us that four scenarios had been modelled by the Treasury; two of them were Professor Garnaut’s scenarios and two of them were scenarios that the government itself had inserted. So we have four options. But did the minister refute the suggestion that none of those four options countenanced other countries doing nothing? No, she did not. She backed up, by her silence, the reality that the government has had the Treasury model four different scenarios for the introduction of the CPRS and its impact on the Australian economy. Not one, not two, not three but all four of these scenarios failed to consider that other countries might not act in concert with Australia. That stands up either as the height of foolishness and recklessness or as the government seeking modelling to provide the answers that it wants to hear. These are the allegations that Minister Wong must respond to if she is to return any shred of credibility to the economic modelling upon which the government plans to base its CPRS.

We are now seeing the impact that this pre-emptive action can have. We have seen the outcomes from Western Australia, where investment decisions are already being influenced and put in jeopardy. We saw the statement today by Nyrstar, an important employer in Port Pirie in South Australia, as it is in Tasmania, highlighting the risk to jobs from early the implementation, in advance of international movements, of the CPRS. These are jobs of real mums and dads, real Australians, who rely on their living to support their families in regional areas like Port Pirie, where a company like Nyrstar stands out head and shoulders as the most significant employer in the township and the area. It is outrageous that the government should be jeopardising those jobs because it will not conduct honest and truthful Treasury economic modelling of the consequences.

Contrary to what Minister Wong might wish to represent, this stands in stark contrast to the position that the coalition had, as advanced by the Shergold report last year. Our position would have ensured not just that we acted in a timely manner that reflected what countries like the United States, Canada and New Zealand, as well as China and India, would do but also that we took all necessary steps to protect Australia’s trade-exposed industries—those emissions intensive industries that are at serious risk if we get it wrong. I for one very clearly support the notion of the precautionary principle in taking action on the risk of climate change, and have done so since the beginning of my time here. But what is most important is that we get any action we take right. There is absolutely no point in people in Port Pirie, Tasmania, Western Australia and right around Australia losing their jobs because of pre-emptive action based on economic modelling that has failed to model all the clear scenarios—and the scenario that other countries will not act is very real—and that fails to take into account that we have many emissions-intensive, trade-exposed industries that need clear, lasting protection; the type of model the government is proposing.

Jacinta Collins (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the same matter. Senator Birmingham takes us back to the period before the last election, and I think it would be fruitful in this debate to contemplate what occurred at the last election. The government got a very clear mandate to act on climate change. We got a very clear mandate to act in relation to the Kyoto policy—and the Australian general public at large does recall what happened under the Howard government in relation to Kyoto.

In this debate we confront opposition senators demonstrating once again, as Senator Forshaw said, that stripped to the bone they are actually climate change sceptics and will grapple for and use every opportunity they can to revert to that position. The Rudd government does accept that we are confronting a global financial crisis. We have acted early and with strength. But for the opposition now to use every indication of industry instability to argue that that relates to our plans on climate change and that all efforts here should be stalled is clearly irresponsible. They are irresponsible in the sense that the minister referred to in question time but they are irresponsible for other reasons as well.

Yes, Australia is demonstrating leadership on climate change. Since ratifying the Kyoto protocol, the Prime Minister, ministers and senior officers have worked through key, high-level forums to drive multilateral negotiations on a post-2012 agreement, and this will continue. We accept that any post-2012 approach will need to secure the widespread agreement of countries with diverse interests and entrenched positions. But the opposition’s suggestion that the global financial crisis is a reason to just back off is irresponsible because it does not take into account the implications of no action in relation to climate change. The impacts of climate change will have serious consequences for our coastal regions, for ecosystems such as the Great Barrier Reef, for agricultural industries, for wildlife and for communities that are reliant on these assets.

To suggest that the absence of the opposition’s preferred modelling from Treasury is a reason to highlight that the Rudd government is responsible for the loss of jobs—if you were to listen to opposition senators in this debate today, you might as well accept that we are responsible for the global financial crisis as a whole. So it is not surprising, as Senator Johnston complained, that there are some suggestions that the opposition need to be very careful about talking down the Australian economy.

The Rudd Labor government and Senator Wong have highlighted on countless occasions in this place that we are taking a responsible and measured approach to how we proceed in relation to carbon pollution reduction. This responsible approach is in sheer contrast to what occurred under the previous government. We have a very clear mandate. The opposition have made no suggestions, other than through debates like the one today—trying to drum them up—that the global financial crisis is a reason to stagnate. It is not a reason to stagnate. As Senator Forshaw highlighted, the car plan is an example of how we can be responsible in terms of industry policy but also in terms of carbon reduction at the same time. I would encourage opposition senators to contemplate that they can multitask on some of these issues. Some of these policy issues are areas where, as a nation, we can accept our clear role of leadership and the clear mandate received in the last election. We can do two things at the same time.

I fear that, for the opposition, the global financial crisis will become an excuse for not doing many, many things. We might as well have heard that the problems around ABC Learning Centres are related to problems with climate change. That will be the next suggestion to come out of the opposition. It is ludicrous to suggest that every industry failure is now going to be a result of our plans in relation to carbon pollution reduction or emissions trading. (Time expired)

Michaelia Cash (WA, Liberal Party) Share this | Link to this | Hansard source

What additional evidence does this government require before it will take responsibility and acknowledge that its proposed ETS is not only seriously flawed but also, if the government proceeds with its implementation without having proper regard for the current global financial crisis and without an up-to-date fully costed economic impact statement, it will have severe consequences for all Australians? Here we are, a short time after the Rudd government has acknowledged that we are in the middle of a global financial crisis, and those opposite are determined to recklessly pursue the implementation of an emissions trading scheme by 1 July 2010—at a time when many Australian companies are facing the worst financial crisis of the last decade.

We only have to look at the recent announcement in my home state of Western Australia by Alcoa—the world’s largest producer of aluminium. It has to now cut back its plans for expansion. Why is it halting its planned expansion of the Wagerup refinery south of Perth? It is because of, amongst other things, uncertainty associated with the introduction of an Australian ETS. I repeat: uncertainty associated with the introduction of an Australian ETS. Just as the coalition has predicted, an ill-conceived ETS that fails to recognise and address all of the issues will cost real jobs. That cannot be good for Western Australians, let alone Australians.

In WA, the AWU—and, let’s face it, they are supporters of the Labor Party, not of the Liberal Party—are sufficiently alarmed to have issued a statement about the loss of jobs. They have issued a statement that 1,500 construction workers and 150 permanent jobs will be lost because of the decision by Alcoa. But it is not Alcoa’s fault that it has to halt its planned expansion. It is because of the uncertainly created by the Rudd government. The bad news for Western Australia and Australians is that Alcoa is not the only company that has had to halt planned projects. As reported yesterday on forbes.com news, weak demand has hurt Alcoa’s peers as well, and Tuesday’s move by Alcoa follows Monday’s decision by Australian iron ore producers Rio Tinto and Fortescue Metals Group to cut their annual production by 10 per cent due to weakening demand from China.

It is almost comical to hear the Rudd government claim that it is rushing to deliver a scheme because it has to give industry certainty. The only certainty the Rudd government will be giving to industry is the certainty that growth will slow, jobs will be lost, and industry may have to move operations offshore to survive. Let us not forget Mr Rudd’s election promise of evidence based policy. Now it is crunch time for Mr Rudd. Where is the detail? Where is the comprehensive modelling? Where is the analysis of the impact on the cost of living of the proposed ETS? Why does the Treasury modelling for the proposed so-called Carbon Pollution Reduction Scheme fail to model any scenario in instances where the major emitters do not join a world carbon pollution reduction pact? Just 20 months away from the confirmed start date, businesses are confused and they are being kept in the dark as to what the ETS will cost them. The government’s green paper came and went—no economic modelling.

Climate change demands a global solution. It is a global problem. How do we realistically move forward as members of the international community if we do not even know what steps the new president-elect in the US plans to take on a proposed ETS? History proves that Labor cannot be trusted on the economy. All that has happened since the Prime Minister and Treasurer Swan took office is that they have laid claim to the Howard government’s $20 billion-plus surplus. Remember the letter all state Labor premiers wrote to the then Prime Minister on 27 May indicating that they wanted to be involved in the formulation of an ETS? Tell us, Mr Rudd: do the state Labor premiers currently support you? I think not. They will have concerns about the loss of jobs. I say to those on the other side of the chamber: do not put at risk thousands of Australian jobs. Do not put at risk billions of dollars of capital investment in the resources sector and the energy sector. (Time expired)

Question agreed to.