Monday, 22 June 2009
Carbon Pollution Reduction Scheme Bill 2009; Carbon Pollution Reduction Scheme (Consequential Amendments) Bill 2009; Australian Climate Change Regulatory Authority Bill 2009; Carbon Pollution Reduction Scheme (Charges-Customs) Bill 2009; Carbon Pollution Reduction Scheme (Charges-Excise) Bill 2009; Carbon Pollution Reduction Scheme (Charges-General) Bill 2009; Carbon Pollution Reduction Scheme (CPRS Fuel Credits) Bill 2009; Carbon Pollution Reduction Scheme (CPRS Fuel Credits) (Consequential Amendments) Bill 2009; Excise Tariff Amendment (Carbon Pollution Reduction Scheme) Bill 2009; Customs Tariff Amendment (Carbon Pollution Reduction Scheme) Bill 2009; Carbon Pollution Reduction Scheme Amendment (Household Assistance) Bill 2009
Debate resumed from 15 June, on motion by Senator Faulkner:
That these bills be now read a second time.
This is going to be one of the largest debates this chamber has ever had. The Carbon Pollution Reduction Scheme legislation involves some of the most fundamental changes not only to the economic policy of our nation but also to the tax policy of our nation in many instances and many areas. There will be a huge change to the social policy of our nation. The legislation will have an immense effect on those that it touches and it has to be taken with the utmost seriousness, because we have to realise what it is that we are about to deliver and impose on so many people, especially the weak, in our economy.
What is wrong with this legislation is that, despite the desires held by so many and so fervently by so many, when the reality hits the ground it will be the weak and the exposed who will wear the cost. There is something fundamentally immoral and wrong about formulating a policy in this chamber which, when it is passed, is going to cause such wide ramifications to mining workers, steelworkers, aluminium workers, farmers and people in the tourism industry. All those people who bring in the export dollars for our nation are going to be affected by this. I know that so many of my colleagues will give so many speeches and that there is a wealth of information that has to come on board on this, but the outcome of this legislation completely impinges on your belief of the rights of the individual. I will explain how.
The individual should be allowed to progress through life and reach their highest level of self-fulfilment. So many times in this chamber and so many times in our nation we impinge on that, using a bulwark of a moral position or a strongly held belief that the ultimate result is that someone, somewhere pays or has a reduction in what was the primary asset in their lives—their capacity for self-fulfilment. So far the debate in trying to even reach that of the Kyoto protocol has meant that the asset of so many farmers—the vegetation on their property—especially in my state in Queensland, was overnight just taken from them. That is a form of theft. It is theft when there is no payment. When the government comes in and divests the individual of an asset without fair compensation for the purpose of investing it in the community, there is a name for that. It really is a form of communism, a form of communal ownership. That has already happened. An emissions trading scheme goes to the sense of production, something that a person who believes in business should adamantly fight against, because such a scheme—and we must remember the ETS is only a subset of the CPRS—says that it does not matter whether you make a profit or not you will be taxed if you produce. This is the ultimate intrusion into the lives of so many people. If you produce, regardless of whether you make a profit or not, the government has the right to create a product that it insists you purchase.
From that philosophical premise alone, no matter where you stand, the whole nature and structure of this emissions trading scheme is wrong and it must be defeated. What this is all about and what makes this really galling is that, if the scheme goes forward, we are looking at something that is going to reduce the carbon levels of 1990 by five per cent in a nation that only produces about 1.4 per cent of global emissions. We have to remember that anthropogenic carbon emissions, those that are produced by humans, amount only to about three or four per cent and that carbon, the air that we breathing here in this chamber tonight, is only about 380 parts per million. So tonight we are devising a piece of legislation, the effect of which on the world will be 0.0000000798 of one per cent. That is obviously no effect at all. So let us put it aside. It will have absolutely zero effect on the globe. Even if you believe chapter and verse everything about global warming, then you must acknowledge that this legislation has no effect on the climate of the globe.
So what is it about? What do you call something that you put forward that has no effect, about which you incite a welling up of a moral good, a moral paradigm? It is a gesture and it is extremely dangerous in our nation when we start voting for gestures, because there are a whole lot of gestures out there that are worth while voting for. I remember my curiosity being stirred when I was listening to a science report as I happened to be going past a place called Lake Keepit in New South Wales. An emeritus professor, chair of one of the Ivy League colleges—I cannot remember whether it was Princeton or Harvard—was talking about the hierarchy of concerns in the world. He was asked if global warming was an issue and he said: ‘Yes, it is an issue, but it’s not the biggest issue. Malaria is a big issue. Tuberculosis is a big issue. A whole range of things are large issues and are happening right now that we must deal with. This is an issue but it’s not a big one.’ So should we therefore now in this chamber put motions to deal with malaria and tuberculosis, motions to deal with Zimbabwe and the Sudan, motions to deal with the rights of people in Iran? All these things are wonderful issues and should be pursued, but the reality is that in Australia our capacity to effect them is no more than a gesture.
In this debate there has been a moral bulwark put forward to incite the emotion of the Australian people, with statements about the CPRS legislation such as, ‘This will stop any problems in the Great Barrier Reef,’ ‘This will stop droughts,’ ‘This will stop diseases,’ and, ‘This will stop bushfires.’ If you take a step back and really think about it, it is all ridiculous. It has no capacity whatsoever to deal with any of those issues. So what does it do? Let us look at who wins and who loses in this. Who are the losers? The losers will be those people who cannot pass on the cost: the people pushing the shopping trolleys—they will be the losers.
There are the people in areas, such as Mackay, where Frontier Economics have clearly pointed out that there will be a 20 per cent reduction in the economy. There are the coal workers and manufacturing workers around Gladstone, the Hunter Valley and the Illawarra. Those in the farming areas and the coal belts of Australia are the losers. There will be a 20 per cent reduction to their economy. What you must ask yourself, if you think it is moral, right and just to impose that on those people, is: are you prepared to put your job first? If you are not prepared to put your job first then isn’t it just a little bit selfish to not be prepared to say, ‘Because this is so imperative, I put my job first onto the funeral pyre, one which will have no effect on global climate change, for a gesture’?
Who wins? The winners will be the bankers, the bureaucrats and the brokers. They will win. But they do not actually put anything on the boat to pay for our standard of living. They do not put anything on the boat that pays for everything that is so apparent around us and which sustains our standard of living. So we are taking away those who are producing for our economy to replace them with those who are, to be honest, a form of parasite on our economy. Why are they parasitic? It is because, in essence, in the way that they will deal with this emissions trading scheme they will only be profiting from the depletion of the productive sectors of our economy.
We have heard the story about green jobs and, in some of the Senate inquiries, some of it descended into bathos—the belief that we can take people out of the coal industry, the steel production industry and the farming industry and somehow find them green jobs in a way that is not even apparent in the economy at the moment. There is no way that anybody can say that there is the capacity for us to take the people who are currently employed in the sectors of farming, mining, manufacturing and tourism and put them into jobs that just do not exist. When we look at areas such as the photovoltaic cell industry, even now, we see that this is an industry that is predominantly based overseas. Even the wind farms talked about are predominantly based overseas. We might import the product but, even in the importation of the product, what do we put on the boat and send in the other direction to pay for it? We put on the output of the areas that we are taxing, the areas that we are reducing.
Then we have the argument that it is politically right that we go forward with this because we should lead the world. We are creating an awfully high bar for ourselves. Let us drill down into that. Do we believe for one moment that Dmitry Medvedev in Russia stays awake all night worrying about the position of Australia on climate change? Do we believe that Barack Obama is currently, somewhere in the world, tossing and turning because of the position that Australia may take on climate change? Do we believe that Hu Jintao is really concerned about what Mr Rudd might say on climate change, or that Manmohan Singh is really concerned about Australia’s position on climate change? It is the ultimate form of conceit to think that 1.3 billion people in China and 1.1 billion people in India, with all the issues that pertain to them, are really going to be expecting some sort of lead from Australia.
It is an issue of conceit and it is an issue of pride—and pride comes before a fall. It is also completely and utterly impractical. What it does is to hugely expose our nation to the effects of the globe and enlarge the capacity of our exploitation by others. People say, ‘What about the Waxman-Markey bill that is currently before the United States congress?’ Initial costings of the Waxman-Markey bill by Lord Christopher Monckton are in excess of $60 trillion, so the form that the bill is in at the moment is not the form that it will go through in. It will be utterly changed. They just cannot afford it. It is impossible. The Chinese have asked for one per cent of the United States GDP to go forward as a form of compensation. These are outrageous claims. They are not going to happen.
So the reality of the politics is something that is a million miles away from the rhetoric of Mr Rudd and the rest of the Labor Party on this issue. Even if we drill down into this legislation and look for the authenticity of it, if there were true authenticity in this legislation—if people truly believed the proposition that it is going to reduce carbon emissions and that it is there for the purpose of making the globe cooler by Australia flying solo—you would think you would be able to underwrite that with a guarantee that said that, if you got it wrong, you would pay the money back. But the Australian government have never said that. They have said that they will collect the money, but there are no guarantees whatsoever that, if they have got it wrong, they will ever pay it back. I remember reading the white paper, and the first thing I noticed in it was a huge disclaimer against any responsibility in case of it being used in a court of law or in case of someone saying, ‘You have misled me’. In essence, they all add up to a piece of legislation that is entirely dangerous.
This legislation is based on a premise of an equilibrium model. The premise of an equilibrium model, of course, is that no-one loses their job. Would you not think it strange that, when we are in the middle of the greatest financial crisis since the Great Depression—which is what everybody in the parliament has said—the only government in the world that has brought a piece of legislation in that is actually going to make the situation worse is Australia, with the emissions trading scheme? The ETS, for so many people, will be the employment termination scheme.
Wouldn’t you think that it would be prudent to sit back and make sure that we do not completely tip Australia into a state where it is completely at an economic disadvantage? No matter how wonderful our thoughts are, poverty gets you nowhere. Poverty does not give you the position or the power to negotiate on anything. The reality is that we will be putting great impediments, caveats, further caveats and imposts on the farming sector, the mining sector and the tourism sector, remembering that aviation fuel is covered by an ETS. All of those industries have said, ‘As soon as this comes in—it is a simple calculation of facts—we will reduce our service and our participation in the economy.’ The aggregate size of the economy will constrict. For a country that is heading towards $315 billion in federal debt, $150 billion in state debt and rising unemployment in the middle of the greatest economic crisis of postwar times, it is the height of stupidity and irresponsibility to be going forward with this right now. There are no other words for it.
Let us look at things in isolation. We know that agriculture ultimately, from 2013 to 2015, will be brought into this scheme. Many people say, ‘We’ll be able to offset it with soil carbon.’ No, you will not. Soil carbon is not allowed under, and is not part of, the Kyoto protocol. A bovine ruminant, as an example, produces about 70 kilograms of methane, which has an uplift factor in the Kyoto protocol of 21, so it works out at about 1½ tonnes of carbon per beast. The National Australia Bank—and these are prudent and competent people—are modelling a price of carbon between $10 and $100. Let us give them $50. At $50, the herd in Australia, approximately 28 million head of cattle, will have about a $2 billion-plus impost per year, and this is on just one industry. It would be the finish of the cattle industry. It will absolutely downgrade the prospects in the mining industry. Even in the sheep industry, it will downgrade mutton.
BlueScope Steel said 25,000 jobs will be moved out. Where are these jobs? The Illawarra, the Hunter Valley, Gladstone and Mackay—surprisingly enough, Labor seats. In essence, we have the National Party and others going in to bat for the working families of these areas to try and keep them in work. It is the working families of Australia that will pay the price for this. It is those who cannot offset the cost who will have to wear the cost and pay the price.
There is this illusion that the ETS is the only form of carbon pollution reduction scheme. It is mischievous politics on the part of Mr Rudd and Minister Wong to make us believe that the only form of carbon pollution reduction scheme that is available to us is the current ETS. It is not. There are myriad carbon pollution reduction schemes that have been part of our nation in the past and no doubt will be part of our nation in the future that do not involve a trading scheme that is to the benefit of the brokers, the bankers and the bureaucrats.
This debate must go on. It must be taken to its fullest extent. It must be ventilated. Although people have certain beliefs in some instances, on some issues such as global warming—let us be honest—the debate is changing all the time. We must acknowledge that people have a right to be sceptical as new facts come to light. Even those who want to do something to go forward are not properly informed of exactly what the emissions trading scheme is going to mean to them when it arrives at their dinner table, when it arrives in the cost of food, when it arrives in the cost of fuel, when it arrives in the cost of electricity, when it shakes them out of their farm—it will be the final straw that shakes the family farms to pieces—and when it takes them out of the coalmines. Some gorilla in a set of overalls will walk down the street and change the locks on the house because they can no longer make the payment on their house. It will destroy the whole social fabric of so many areas. It is these people that we must be going in to bat for, because it is these people that are being ignored in the palaver of love and affection that comes from one man’s desire to go on a solo crusade to try and save the world, when in actual fact he has not got a chance. We will be flushing our nation’s economy down the toilet in the process.
We must look for those people who have been left behind in this debate. We must make sure that we continue to fight for this. People say the delaying of the debate is a dirty tactic. No, it is not. The delaying of the debate and the continued ventilation of this issue are the only just, right and proper things to do. We must continue to ventilate this issue as long as we possibly can; otherwise, those who will be affected will be those who can least afford it. As I said before, it was Cato back in about 40 BC who brought about the extension of the debate to try and stop Julius Caesar basically becoming a tyrant in Rome. Why? Because he knew it was the right thing to do. That is what we are going to do. However long it takes, we will make sure that we continue to pursue this issue.
I rise this evening to speak on the government’s proposed Carbon Pollution Reduction Scheme, introduced in the Carbon Pollution Reduction Scheme Bill 2009 and related bills. As members in the chamber would be aware, the Greens have been campaigning on climate change for more than 20 years. In fact, I was appointed to Australia’s first greenhouse council in Victoria in 1990, when I was in the Tasmanian parliament. I have been working on that issue ever since in the state parliament, in the federal parliament and globally through the International Union for Conservation of Nature. The Greens around the world have taken a very strong position on this.
I could not disagree more with the Leader of the Nationals in the Senate, Senator Joyce, in his summation of the current situation in relation to climate change. He said things are changing constantly, and they are. But that has no truck with the sceptics. Things are changing very quickly and the science is showing that we are tracking at the worst-case-scenario end of what was predicted by the Intergovernmental Panel on Climate Change. Three months ago in Copenhagen, some of the leading scientists came to assess how we were tracking against the Intergovernmental Panel on Climate Change report which assessed the science from a few years previously. This report came out last Thursday and said:
Many key climate indicators are already moving beyond the patterns of natural variability within which contemporary society and economy have developed and thrived. These indicators include global mean surface temperature, sea-level rise, global ocean temperature, Arctic sea ice extent, ocean acidification, and extreme climatic events. With unabated emissions, many trends in climate will likely accelerate, leading to an increasing risk of abrupt or irreversible climatic shifts.
We are now in a global emergency and you would not know it, living in Australia. You would if you had a look at what was happening to the natural environment in Australia, if you went out into the Murray-Darling and saw the collapse that is occurring in the Murray-Darling because of extreme weather events and if you had a look at what happened in Victoria last summer with the bushfires, where we had more extreme fires as a result of high temperatures, higher levels of evaporation over a long period of time and reduced rainfall leading to that extreme event.
Eight hundred people died in Australia last summer as a result of climate related incidents. They were the extreme heatwaves in South Australia and Victoria and the fires. That will be compounded as time goes on as more and more vulnerable people are actually subject to these extreme weather events. That will include many people living in our coastal areas. Last summer we were lucky to avoid a hurricane off the Queensland coast. We have known for some time that, essentially, the weather has moved. Climate conditions have moved 100 kilometres south, and there are areas now in Queensland extremely vulnerable to extreme hurricane events which you would not expect and which they are not prepared for.
In fact, we had the former Premier of Queensland, the Hon. Peter Beattie, saying that he wanted on the one hand to expand coal exports and on the other to build a series of bunkers down the coast so that Queenslanders could go into those bunkers in the face of extreme cyclones, hurricanes and those storm surges. This showed exactly what the problem is in Australia. He actually demonstrated what the problem is—and that is weak leadership. As Kofi Annan said recently:
The world is at a crossroads. [The Copenhagen] negotiators [must] come to the most ambitious agreement ever negotiated or continue to accept mass starvation, mass sickness and mass migration on an ever growing scale. Weak leadership—
… is failing humanity.
That is precisely where we are in this debate in Australia. There is weak leadership from the business community and there is weak leadership from the political establishment, and that has just been demonstrated by the contribution from Senator Joyce.
I say that because no party ought to be stronger on addressing climate change than the people who purport to represent rural and regional Australia, because rural and regional Australia is suffering right now. Talk about the threats of job losses—the job losses in rural and regional Australia are real. Right now there has been a collapse of productivity and a loss of jobs in rural and regional communities as a result of the collapse of the Murray-Darling river system itself. And we still see that the dominant economic and social view in Australia—and therefore, the Labor and coalition view—is that resource extraction underpins wealth, power and influence and that it always has and it always will. That is why you get this absolute passion that the mining of coal must go on, regardless; exports of coal must go on, regardless; we must build new coal railway lines; we must build new coal ports and we must maintain coal-fired power stations, even though the British government has given a very strong signal to its coal-fired generation sector that if they have not got carbon capture and storage attached by 2020 then they cannot continue to operate.
That is the reality and that is what ought to be coming here. But instead of that the problem is that we still have a parliament dominated by people who think that, regardless of whether or not the earth can sustain the current level of resource extraction and the current level of waste being dumped into our atmosphere, it must go on because they cannot envisage a system of governance and a system of societal wellbeing in Australia that is not dependent on a resource based economy. That is the tragedy. It is why we do not have a Green New Deal in Australia, linking climate policies with economic stimulus; it is why we engage in special pleading in climate negotiations; and it is why we have this utterly ridiculous system where there is a pretence that there is a whole-of-government approach on climate change when there is nothing of the sort.
We have the Carbon Pollution Reduction Scheme, with one minister saying that we must do this to reduce emissions and, at the same time, we have the conversion to LPG vehicles subsidy taken away. Why? Because of the reduced excise from selling petrol in Australia. The government is losing money from petrol excise and therefore we stop the LPG conversion. We have the money poured into subsidies for new oil and gas exploration. Just last week we had, again, the legislation guaranteeing the subsidies as a result of the fuel tax. So we were making sure that the mining industry, which received $1.5 billion last year in subsidies—30 per cent of the total for 2007-08—was guaranteed that continues.
Under the Carbon Pollution Reduction Scheme we have, on the one hand, transport put in on the basis that a price signal is required to drive people to change their behaviour to reduce the amount of driving they do, then at exactly the same time the government puts in a subsidy to neutralise the price signal so that people do not feel any price pressure and the result is they keep on driving just as much as they did before. We cannot even get mandatory vehicle fuel efficiency standards in Australia, and yet we have the government saying on the other hand, ‘Oh, we’ve got this $500 million green car fund.’ On one hand they say, ‘Here we go with the renewable energy target,’ and on the other hand, ‘Let’s put $2 billion into clean coal to subsidise the coal industry and let’s take that money out of the Education Infrastructure Fund.’ It was meant to build infrastructure in our universities to cater for the increased number of students we were hoping to get in those universities.
The Greens have made a considered decision that, because this is a climate emergency, because we are seeing about 300,000 people around the world dying each year because of extreme weather events, because we are seeing the glaciers melt, because we are seeing our Asia-Pacific neighbours struggling with sea level rises and because we already see methane chimneys bubbling up in the Arctic, we recognise that we are very near a runaway heating cycle. If we do go over these tipping points—and we are dangerously close to those tipping points—it will be irreversible. It will be too late then for people to say, ‘We have to do something about climate change now,’ because once you have started that methane coming out of the melting in the Arctic and once you have the thermohaline circulation slowing down you cannot reverse them. You cannot refreeze the Arctic ice. You cannot change those global systems once they tip over.
We have a situation where the Greens are saying that rather than even 450 parts per million—the government seems to think that is a sufficient target, but its own legislation is consistent with 550 parts per million or even higher—new science is now saying we should be aiming for 350 parts per million. As CSIRO scientist James Risby said recently, a safer target would be something closer to 350 parts per million, because that would reduce the risk of exceeding two degrees Celsius to more moderate levels. So when we look at the actual Carbon Pollution Reduction Scheme, the issue for the Greens, first and foremost, is the science. We have been advocating real solutions to climate change, but the government has actually been standing in the way. Whether it is the forests, which we have argued should be protected immediately because they are carbon stores, whether it is the gross feed-in tariff or whether it is the energy efficiency measures, we have been told to simply sign up to the government’s plan, which sets its sights so low as to actively lock out the option of success. It is an agreement to fail, and that is because by 2013 the government would have the same greenhouse gas emissions as it has today, making deep cuts by 2020 more difficult. A failure to agree this year is a better outcome than, as I said, an agreement to fail.
Incrementalism is worse than useless when it comes to climate change. Just as you cannot be a little bit pregnant, you cannot stop climate change by doing five per cent or even 25 per cent of what is necessary. The 25 per cent is not real. The government keeps talking about 25 per cent conditional, but the conditions it has put on the 25 per cent are such that it will never be agreed in international fora, and the government knows it. So we have a situation where we are on the point of triggering those tipping points, and we most certainly do not want to be going there. We need to be going with deep cuts early. In fact, although it sounds counterintuitive, a $40 carbon price is cheaper than a $10 price because of the signals that it sends into our economy. The reason that we do not support this scheme is that it is too weak, its sights are too low, its targets are not strong enough and it sends the wrong signals. It is basically failing to recognise what we need to do. Even the UN climate secretariat on 6 June this year said that the pledges made by rich countries pledging between 16 and 24 per cent below 1990 fall well short of what is needed to avoid catastrophic climate change.
What we have to make sure is that when Australia goes to Copenhagen we have legislated for the 25 per cent minimum that the world requires from rich countries. That is within the 25 to 40 per cent road map that was set out in Bali, and we should put 40 per cent on the table. Our failure to do so—our five to 25 per cent conditional target—has already provided Japan with the cover it needed to announce its eight per cent target in Bonn, and the Chinese negotiators have already slammed Australia’s target and conditions as obnoxious. Follow the CPRS scenario to its logical conclusion and we will not see an agreement in Copenhagen.
Furthermore, we cannot accept a scheme which is geared toward protecting the status quo and sandbagging the old, resource based economy when we need transformation. Business needs long-term investment horizons in order to make multimillion-dollar investments, and the CPRS will provide such an investment horizon—but it will be the wrong one. Evidence from the London Carbon Exchange provided to the Senate committee, which I was deputy chair of, as well as the recent report of the Productivity Commission and comments from Sir Nicholas Stern all conclude that if the CPRS is passed in its current form Australian industries and investors will be sent a very strong signal that will drive inappropriate and misguided investments. This signal will give business the confidence to invest in low-pollution infrastructure such as gas power stations and slightly-less-dirty coal rather than in renewables.
The Eraring coal-fired power station in New South Wales is a case in point. If ever there were an example of where the government’s targets have sent the wrong signal to investors, it is in showing that it is worth while for investors to invest in coal fire at Eraring because they can see that they are going to be able to get away with coal fire for much longer than anywhere else in the world. That demonstrates why that is such a bad idea, but it is also sending a very bad signal to the Australian community. It is saying that, no matter how much the Australian community does, the government has effectively put a floor under pollution levels, so the community is prevented from being able to actively reduce emissions on any kind of reasonable scale. It is certainly disempowering, and with the revenue from the scheme going half to the big polluters and half to the community—not through energy efficiency but in cash handouts—you are not going to get the transformation.
This massive $16 billion in corporate polluter welfare is a grossly unacceptable transfer of wealth from the community to the polluters. That was recognised as such by Professor Garnaut. Everybody who has looked at it says it is ridiculous to be giving out this money to the rent seekers. It is just as well that they have been referred to the authorities as a case in point. Many of these companies, including BlueScope Steel that Senator Joyce mentioned, are the ones who have been saying that jobs will be lost. On the other hand, they are not telling their shareholders that at any point in the cycle. They say one thing to the parliament and one thing to their shareholders.
I have circulated a second reading amendment to this legislation, which I move:
At the end of the motion, add:
provided that the Government first commits to entering the climate treaty negotiations at the end of 2009 with an unconditional commitment to reduce emissions by at least 25 per cent below 1990 levels by 2020 and a willingness to reduce emissions by 40 per cent below 1990 levels by 2020 in the context of a global treaty.
This amendment basically says that from the point of view of the Greens, the key issue is the target. Unless we deal with the science, unless we get rid of incrementalism, unless we go for deep cuts, there is no point in doing what the government is doing. It is shielding the big polluters, disempowering the community and sending the wrong signal to Copenhagen. Unless we shift our targets, there is no point in going into the committee stage of these bills. The Greens’ amendment says that the bills should only be read a second time:
… provided that the Government first commits to entering the climate treaty negotiations at the end of 2009 with an unconditional commitment to reduce emissions by at least 25 per cent below 1990 levels by 2020 and a willingness to reduce emissions by 40 per cent below 1990 levels by 2020 in the context of a global treaty.
That is what the rest of the world expects of us. That is what would position our economy to take advantage of the hundreds of thousands of jobs that are out there in the new green economy, which the rest of the world recognises with the green new deal.
It is tragic that we did not get that kind of recognition in Australia with the stimulus package. Everywhere else, there is a recognition that, to get to the low carbon/zero carbon economy, you have to make a massive investment in renewables. You have to make a massive investment in energy efficiency in public transport, but you have to have a major shift in thinking. The resource that is lacking in Australia is imagination and it is the resource of the future. Because we have so many resources in the ground, all we think about is digging up, cutting down and shipping away rather than investing in imagination, which is the resource of the future in a post-carbon economy.
Contrary to what the naysayers like Senator Joyce have to say, the labour market has an extraordinary capacity to handle structural change. In the decade to November 2007, employment in rural industries dropped by almost 100,000 jobs, employment in manufacturing dropped by almost 50,000 jobs and employment in wholesale trade dropped by 35,000 jobs. Yet, over this period, the unemployment rate fell from 8.5 per cent to four per cent. Similarly, over one million workers employed in February 2005 were no longer with the same employer a year later, and half of them had changed industry. We see that there is huge potential if we get this shift in target. We are not going to accept legislation that is piecemeal, that does not give us a whole-of-government approach, that does not look at the potential to reduce emissions across the board—particularly in land use, land use change and forestry, which go hand in hand—that does not go full on with renewables and efficiency and that does not get rid of all the subsidies to the fossil fuel sector, which undermine the effort. (Time expired)
I am pleased to participate in the debate on the Carbon Pollution Reduction Scheme Bill 2009 and related bills. I come to this debate as a former power industry worker and as someone who has represented power and coal industry workers as a union official. I have always supported workers in those industries and do not come here purporting to support blue-collar workers, like some of those on the opposite side. I object to workers being used as part of the National Party’s agenda. However, I should never be surprised by the party who helped give us Work Choices.
It is absolutely essential that carbon capture and storage is developed to ensure that the industries that are important to this country—the coal fired power industry, the steel industry and the cement industry—have an opportunity to grow and survive into the future.
Anthropogenic climate change is the most significant economic, social and environmental challenge facing governments around the world. It is a challenge of huge complexity. It is a challenge that demands political leadership. It is a challenge that requires political courage. It is a challenge that will result in social and economic change. This change can be for the better.
This is a challenge the Rudd government is determined to meet. It is a challenge that those on the other side are failing to meet. The challenge is local, regional, national and international. The challenge requires decisions in the short term to influence long-term climate change. There is little doubt that a failure to act now will result in extreme weather, higher temperatures, more droughts and rising sea levels. This is the climate change reality that the opposition have failed to come to grips with.
Climate change is projected to increase the severity and the frequency of many natural disasters, such as bushfires, cyclones, hailstorms and floods. Insured losses from these events are expected to total billions of dollars. Nineteen of the 20 largest property insurance losses since 1967 have been weather related. An increase in the frequency and severity of drought conditions resulting from climate change will reduce the availability of water. The frequency of droughts may increase by up to 20 per cent over most of Australia by 2050 and up to 40 per cent in south-east Australia and 80 per cent in Western Australia by 2070.
Changes in rainfall combined with increased evaporation are expected to result in reduced run-off across most of Australia. By 2050, average stream flow is projected to drop between seven and 35 per cent in Melbourne, 10 to 25 per cent in the Murray-Darling Basin and 51 per cent in the Stirling catchment area in Western Australia. Agricultural production in the Murray-Darling Basin could decline by up to 92 per cent. Under a temperature increase of two degrees Celsius, our national livestock carrying capacity is projected to decrease by 40 per cent.
Climate change is expected to cause more heat related deaths and higher incidence of disease from food- and water-borne contaminants. The threat from vector borne disease will increase; for example, the transmission zone for dengue fever may spread south to Brisbane by 2100. Climate change is expected to affect our infrastructure. Changes in temperature and rainfall are expected to increase road maintenance costs by 31 per cent by 2100. Australia is highly vulnerable to sea level rises and storm surges resulting from climate change, with significant coastal erosion and damage to infrastructure anticipated. Seven hundred and eleven thousand addresses, many billions of dollars of assets, are at risk from rising sea levels and storm surges. Australia’s native plants and animals are also likely to suffer as a result of climate change due to the drastic reduction of the extent and quality of their habitats. Ecologically rich sites such as the Great Barrier Reef, the Queensland wet tropics, Kakadu wetlands, the Australian alpine areas, south-western Australia and sub-Antarctic islands are all at risk.
As we watch these potential disasters unfold, it is an act of political cowardice and gross incompetence for the opposition to stand idly by while the climate deniers and sceptics rule the roost in the coalition party room. Mr Turnbull needs to stand up to the deniers. The Leader of the Opposition needs to stand up to Senator Abetz, who claims:
There is no doubt that weeds pose a challenge much clearer, more present and possibly more serious than the unclear challenge which climate change may or may not pose to our biodiversity.
Weeds are the problem, not global warming, according to Senator Abetz. Mr Turnbull should stand up to Senator Joyce, who on 14 January 2009 said on ABC radio:
Climate change denier, like Holocaust denier, this is the sort of emotive language that has become stitched up in this ETS issue. A climate change denier? One is not allowed to question any more and one is not allowed to call to question? One has to sort of fall into sort of a lockstep goosestep and parade around the office, you know, ranting and raving that we are all as one.
Well that will make a change from ranting and raving out there with the press every morning that parliament is sitting. Senator Joyce was quoted in the Australian on the same day:
This has become a form of religious fanaticism and these environmental goose-steppers are pretty scary. You’re branded a denier. The last time that word was in vogue, it related to the Holocaust.
The Leader of the Opposition, Mr Malcolm Turnbull, in an interview on the same day in Launceston, said:
Oh look, I’m not going to run a commentary on my colleagues. Our position is, the Coalition’s position on this issue is very well known. It is the same as we had in government. We’re very committed to action on climate change that is economically responsible and environmentally effective.
Well, the Leader of the Opposition, Mr Turnbull, now has the chance to show his commitment to action on climate change and stand up to Senator Minchin, who on 16 January in the Sydney Morning Herald said:
I don’t think Senator Joyce’s remarks should be seen as anything more than an appropriate contribution to the debate on how the Coalition as a whole should respond to the Government’s so-called carbon pollution reduction scheme.
It is ‘an appropriate contribution’, according to Senator Minchin. That contribution is a contribution of denial. It is a contribution of scepticism. It is a contribution that is economically irresponsible. It is a contribution that, if unchallenged, will consign future generations to climate change that will destroy their standard of living, their environment and their hopes for a decent life. The Australian community is entitled to demand decent leadership from the coalition. Where are those in the coalition who support the need to address climate change? Where are those in the coalition prepared to stand up for future generations and not be intimidated by the deniers and sceptics on their side of the chamber?
As part of his belated response to climate change, the former Prime Minister, John Howard, announced the establishment of a joint government-business task group on emissions trading. This announcement, on December 2006, resulted in what is known as the Shergold report. Despite the many limitations of the Shergold report, a number of conclusions were reached which give the lie to the nonsense we hear from the other side and from those deniers and sceptics that rule the roost on the other side of parliament. I will go through some of the conclusions of the previous government’s inquiry:
Climate change is a global challenge that requires a long-term global solution in order to avoid environmental, social and economic dislocation.
They do not believe there is going to be any economic problems; they do not believe there is going to be any dislocation. Another proposal says:
Curtailing greenhouse gas emissions will impose a cost both in the global economy and individual nations.
Even John Howard accepted there would be a cost to fixing global warming. The report went on:
While a comprehensive global approach to climate change is required, it will be difficult to reach international consensus in the near future.
… … …
Market-based approaches that deliver a price on carbon will achieve greenhouse gas abatement, commensurate with an emissions target, at least cost.
… … …
Of the market-based instruments, emissions trading should be preferred to a carbon tax.
… … …
An Australian emissions trading scheme, with a carbon price set by the market, would improve business investment certainty.
You see, even the Howard government then conceded the point about business investment certainty. But the opposition, led by Malcolm Turnbull, are deniers on everything relating to climate change. The Shergold report went on to say:
It is in Australia’s interest to develop a domestic emissions trading scheme that might, over time, be linked to complementary schemes in other countries.
… … …
The inclusion of trade-exposed, emissions-intensive industries in an Australian emissions trading scheme must avoid prejudicing their competitiveness but also provide them with appropriate incentives for abatement.
… … …
The Task Group believes the key to success is to begin at once—
that is what Shergold said: ‘the key to success is to begin at once’—
but to proceed with care on the basis of considered and informed decisions.
The split in the coalition has the potential to deny Australia an immediate opportunity to tackle climate change in a comprehensive, considered and effective manner. The government’s bill is economically responsible, environmentally responsible and in the best interests of the nation.
If we ever need any reminding of the need to move forward immediately and effectively, we only need to look at the recent Synthesis Report, which resulted from a major international scientific congress, entitled Climate change: global risks challenges and decisions, that the ANU organised with the University of Copenhagen in March. The report, known as the Copenhagen report, whose authors include Professor Will Steffen and Professor Lord Nicholas Stern concluded:
Recent observations show that greenhouse gas emissions and many aspects of the climate are changing near the upper boundary of the IPCC range of projections. Many key climate indicators are already moving beyond the patterns of natural variability within which contemporary society and economy have developed and thrived. These indicators include global mean surface temperature, sea-level rise, global ocean temperature, Arctic sea ice extent, ocean acidification, and extreme climatic events. With unabated emissions, many trends in climate will likely accelerate, leading to an increasing risk of abrupt or irreversible climatic shifts.
The report also points out that climate change will:
… cause major societal and environmental disruptions through the rest of the century and beyond.
… … …
Rapid, sustained, and effective mitigation based on coordinated global and regional action is required to avoid “dangerous climate change” regardless of how it is defined.
The report goes on to say:
Climate change is having, and will have, strongly differential effects on people within and between countries and regions …
The most important point the report makes is:
INACTION IS INEXCUSABLE
Society already has many tools and approaches – economic, technological, behavioural, and managerial – to deal effectively with the climate change challenge.
This report, compiled by some of the world’s most eminent climate change scientists, must be a wake-up call to those opposite and must surely cause those in the coalition who are not captive to the climate change sceptics and deniers to stand up for the nation and stand up for the planet.
I want to turn briefly to the red herrings raised by the coalition deniers to justify inaction on climate change. These include the arguments: that action by Australia will simply be a gesture; that the Treasury modelling is flawed; that the CPRS will impose costs on the community; and that regional impacts have not been taken into account. Senator Joyce is the lead advocate of the gesture politics theory. This approach is similar to the argument being put forward by some of the biggest polluters in their special pleadings. It is reprehensible that the coalition chooses to perpetuate the falsehood that the government’s legislation would result in 23,500 direct jobs being lost across Australia’s mineral industry by 2020. It is an absolute disgrace that Senators Joyce and Boswell are using this falsehood to create confusion and concern amongst working families in the minerals industry.
The Minerals Council report that this nonsense is based on estimates that there will be approximately 23,500 fewer people employed in the Australian minerals industry due to the imposition of the proposed ETS than would otherwise have been the case under a reference case that predicts at least an additional 86,000 jobs in the industry by 2030. This means that under the government’s proposed ETS there will be around 60,000 more jobs in the minerals industry relative to today. That is 60,000 more jobs in the minerals industry with the ETS. That is the Minerals Council report. That is the report that you reject. That is the report that you are sceptics about. That is the report that you would deny—the actual Minerals Council report. But, in their public utterances on this, the Minerals Council and the coalition, particularly Senators Joyce and Boswell, have sought to put fear into the community by dishonestly characterising slightly slower growth in jobs as ‘jobs lost’. As government senators said in our report for the Senate Select Committee on Climate Policy:
It is misleading to present potential future jobs that are not created in one sector of the economy as “jobs lost”. To do so not only offers a misleading picture of the effects of an ETS, but fails to take account of the fact that capital and employment moves between industries and regions all the time.
Many of the employment arguments put up by those who deny that climate change is caused by human activity—those who accept that climate change is happening but believe it is not a problem—and those who see that something needs to be done about climate change but not by them have tried to suggest that catastrophic job losses will result from the ETS. All of these arguments are at best ill-founded, at worst deliberate deceptions. There is ample evidence that an ETS, a renewable energy target and the range of measures contained in these bills will have no net effect on employment in Australia. Treasury modelling demonstrates there will continue to be robust growth in the Australian economy. I draw the Senate’s attention to a speech in the Great Hall by Australia’s Chief Scientist, who outlined the real trajectory for jobs—jobs for biologists and ecologists, jobs for astronomers and space scientists, jobs for physicists and electrical engineers, jobs for mechanical engineers, aerodynamicists and material scientists. These are the jobs of the future, yet all we have from the opposition is denial and scepticism. All we have from them is no hope for the future. (Time expired)
I rise also to contribute to the debate on the Carbon Pollution Reduction Scheme Bill 2009 and related bills this evening. I have been on the public record for 20 years saying that Australians have a responsibility to prudently manage our resources and minimise our impact on the environment. We inhabit the driest continent on earth and not yet have we come to terms with the challenges this presents. But the debate this evening before the chamber is not about global warming or the role that carbon may or may not be playing in this phenomenon; it is about the Rudd government’s proposed emissions trading legislation and the impact on Australia’s social and economic landscapes. This is a global issue and it requires a global approach. Australian industry and business, and indeed Australian workers, have no difficulty in shouldering an equitable share of responsibility in a global solution. We have a long and proud record of doing so. However, as we emit only 1.4 per cent of the world’s carbon, it is completely ridiculous for the Labor government to expect Australia to bankrupt itself in a misguided attempt to lead the world in reducing carbon emissions. World leaders do not expect it and know we cannot achieve it. Any attempt on Australia’s part will have an insignificant impact. This is simply an opportunistic attempt by Mr Rudd to elevate his profile on the world stage.
The global impact of World War I and Australia’s role in it has relevance to this debate. In 1918, at Le Hamel on the Somme, the iconic general John Monash broke ranks with his British counterparts and refused to send wave after wave of diggers at the enemy. Through meticulous planning and clinical execution, he marshalled limited resources in a most innovative and effective manner. In so doing, he changed the entrenched mindset of military leaders and changed the course of the war. This is Australia’s opportunity to take a leaf out of General Monash’s book and to develop innovative and effective strategies to deal with this current world carbon crisis.
Australia needs to focus on research and development if it genuinely wants to reduce global carbon emissions. Australia should be investing heavily in research and development in those areas where it can make a difference. Australia has a track record of success in this area, and it could donate the benefit of this research to developing countries or indeed sell the IT to wealthy countries. This would have an infinitely greater impact than attempting to reduce Australia’s 1.4 per cent of world carbon emissions.
What has the Labor government done to try to stimulate research and development in this area? Firstly, it has cut funding to the Low Emissions Technology Demonstration Fund. Why? Because it was an initiative of the Howard government. Initially, this program was to fund six projects, including carbon sequestration into an aquifer under Barrow Island. It involved a $60 million government grant and $780 million from the Chevon partners at Gorgon. The project was dumped. The second project involved oxygen production and oxy-firing to improve combustion of black coal. Again, that project was dumped. The third one was the drying and gasification of moist coal, which would have led to a 30 per cent reduction in the cost of producing electricity, a 30 per cent reduction in carbon production and a 50 per reduction in water consumption. Need I ask what happened to that project? It failed because of lack of financial support. Then there was a wonderful project involving new solar system technology, which would have yielded 1,500 times greater efficiency than existing solar cells with resultant carbon savings. But of course no funding was supplied. Under that program there would have been government expenditure of $500 million, with industry contributing more than $2 billion. What a lost opportunity in this climate of carbon issues.
In June 2010, the Desert Knowledge CRC based in Alice Springs will cease due to government funding being stopped. At the same time, of course, Land and Water Australia is to be terminated due to government funding being withdrawn. We know that funding to the Rural Industries Research and Development Corporation has been severely curtailed. All of these organisations have been engaged in world’s best practice research into matters associated with climate change, managing the impact of climate variability, weather forecasting and decision making as a result—matters this evening that have been addressed by our colleagues Senator Milne and Senator Cameron. All of those organisations would have had a direct, interesting and important effect on the capacity of farmers, pastoralists and Indigenous communities to deal with change, if indeed it is occurring. What has happened in all of these cases? Their funding has been reduced or they are to be discontinued. The world is facing a global shortage of foodstuffs and there has never been a more important time for research and development in this area. But what sin has each of these organisations carried out to incur this penalty? All I can assume is that they were focused on rural Australia, a region which regrettably is unknown and of little concern to the government.
I ask: what is the hurry? Consideration of this legislation before the world’s leaders meet in Copenhagen in December this year makes no sense. If passed, the scheme is not due to commence until July 2011, so why the hurry? Senator Evans told us today in question time that the delay is due to business uncertainty. Isn’t that the case! I can assure Senator Evans that one year will not resolve this uncertainty—in fact, 10 years will not resolve it—unless we get a unified approach from our regional neighbours and our trade competitors on carbon emissions trading to restore Australia’s certainty in business. If in Copenhagen Australia listens to and learns from what the United States and the other major players are planning, we may in fact amend our plans to conform to world’s best practice. There is nothing to be gained by passing this legislation at this time. It is simply a meaningless exercise in political expediency.
All that Australian companies are seeking in this emerging challenge of carbon trading is competitive neutrality. They do not seek advantage but they do demand that they enjoy a level playing field against international competition. What is the inevitable outcome of unfair competition from our overseas competitors? I will give you three examples. Firstly, the high-emitting export-exposed industries will move offshore to countries that do not have the same anticompetitive restrictions that we do. This, of course, will only add to global carbon emissions, as many of these countries will be less diligent, with the resultant leakage of thousands of Australian jobs offshore. Whatever my colleague suggests, our Premier is certainly talking 15,000 jobs in our energy industries.
Secondly, we will see an acceleration of what we are already seeing—that is, multinationals winding back on investments in their Australian operations in favour of their overseas ventures while they watch to see the direction Australia takes. We are seeing it happen now, and unfortunately it is difficult to quantify what the effect of that is going to be because they are under no obligation to share their plans for expansion or reveal what future employment opportunities will be, either in Australia or elsewhere.
Thirdly, and most importantly, innovative technology will grind to a halt. In March this year Rio Tinto announced that its HIsmelt pig-iron plant at Kwinana, south of Perth, would be placed in care and maintenance. This is a Rio initiative to develop a low-carbon-emissions smelter using thermal coal from Collie which, when fully operational, will significantly reduce the amount of carbon emitted per tonne of end product produced—surely the sort of thing we should be encouraging. Due to uncertainty over this government’s position in relation to our competitors and its inability to see the long-term gain, the whole project has been mothballed for at least 12 months.
My colleague Senator Cameron drew attention to Treasury modelling. I simply ask: why isn’t the Treasury modelling being supplied? We were told by Treasurer Swan in 2008 that Treasury economists had not modelled what the impact on Australia would be if our regional neighbours failed to embrace some form of emission reduction. We were merely asked to take on face value that Australia in some way would be disadvantaged compared to our European partners if we did not commence. Well, if we are not commencing till July 2011, we cannot be too concerned.
Are we really being asked to believe this? Does the Treasurer really think that most of our trading partners are in Europe? Surely he realises which region Australia operates in, where most of the competition is and where most of our trading partners exist. Either Treasury officials did not do this modelling—in which case I say they were grossly unprofessional and have provided advice to government on the basis of incomplete information—or they did do the modelling and it showed the likely disastrous impact on Australian jobs, business and industry. I am certainly disinclined to believe the former but have every reason to accept the latter. It is disingenuous of this government to ask the Senate to consider such important legislation without fully divulging all relevant information. Surely a decision by our regional neighbours not to participate in a carbon pollution reduction scheme will have a dramatic effect on our wellbeing and we should be in possession of all information necessary before voting.
Working, as I have, in the energy industry in the Middle East, India and Asia over the last decade leaves me with a deep sense of concern about whether these countries in our region will ever participate in emission reduction, in either the short term or the long term. Our capacity to influence their decision, I believe, is minimal. In fact, I can only draw on the words of our Prime Minister: it is ‘zip, zero and none’—mate. For example, the Chinese central government is aware that illegal power stations are being commissioned on a weekly basis in China. Its best estimate is that 20 per cent of the power stations in China are illegally built and operated. On that basis, what chance does the Chinese government have of influencing industry in that country on something like a carbon emissions trading scheme?
This brings me to the question of liquefied natural gas and of course the involvement of the North West Shelf of Western Australia. This is a unique source of energy, more emissions efficient than all other fossil fuels and able to contribute directly to global reduction of greenhouse gas emissions. CSIRO says that, for every tonne of CO2 emitted in LNG production in Australia, at least four times that—four tonnes of CO2—in our customer countries are avoided when LNG is used to displace their coal-fired generation. The effect is even greater in China, where that figure of four tonnes becomes somewhere between 5½ and 9½ tonnes. This leads to some 180 million tonnes of global greenhouse gases being avoided annually. If the government is serious in its efforts to change the world carbon climate then let it remove the barriers to further investment, international competitiveness and uncertainty and encourage this vital but emerging industry to realise its potential.
And what is this potential? Two-hundred billion dollars of gas projects on the drawing boards on the North West Shelf at the moment; a capacity to triple our LNG production—at the moment we are only producing eight per cent of the world’s demand for LNG—leading to 50,000 jobs, 40,000 in construction and 10,000 in operations; and, importantly, greater than $10 billion of tax revenue per annum. These are important figures. If we really want to make a contribution to reducing world carbon then surely we need to get on board and be encouraging, in every way, this important LNG industry.
Let me turn to the impact of this legislation on agriculture. Only in Denmark in the last few days has the point been made that our capacity to be able to feed the world going forward is in danger. In the face of world shortages of foodstuffs, no other region of the world is even considering including emissions trading schemes for agriculture. If we proceed as we are then Australia and New Zealand will be the only countries threatened with a CPRS or similar. Three-quarters of all agricultural greenhouse gas emissions are contributed by the eructation of cattle and sheep in Australia. And 16 per cent of Australia’s greenhouse gases themselves are contributed by agriculture. The agricultural industry—
And a lot of eructation, Senator Cormann! The agricultural industry is rightly concerned and disappointed at the view expressed by some in this debate that in some way agriculture is an environmental vandal as a result of methane gas production by livestock. It goes without saying it is an entirely natural phenomenon. It has been going on for several hundred thousand years, contributes to the natural carbon cycle, existing in healthy cycles, and it certainly is not amenable to change any time soon. There are 180 million cattle in India, and they are revered. If anyone in this chamber thinks the Indian population is likely to interfere in the digestive systems of their sacred cows to influence methane output then they certainly do not know India.
Australian agriculture is already being impacted adversely by the threat of this scheme. Uncertainty abounds in every sector on timing, impact on different sectors and the degree of relief, if any, under the emissions-intensive trade-exposed provisions. This uncertainty is already evident in the financing and refinancing of debt from the banks—and we need to remove the uncertainty. I can assure the Senate that a direct result of reduced livestock numbers, should this be successful—and we have heard from Senator Joyce this evening as to what that impact will be on the cattle industry—will certainly be less food produced, and inevitably, Senator Cormann, there will be less methane gas emitted from a hungry human population.
Let me share some sobering statistics in relation to the world’s population. It is predicted to increase by another three billion by 2050. More than half of this increase will be in our region, in Asia. There will be a dramatic increase in the demand for food, and we are capable of producing much of this. Most importantly, and disappointingly, Australian research and development as a percentage of GDP is half what it was 30 years ago.
I turn, in the final few moments, to the issue of savanna burning and the outstandingly successful West Arnhem Land Fire Abatement Project. It has been in place for most of this decade and has been achieving savings of more than 100,000 tonnes of greenhouse gases annually, due to the practice of early season rather than late, dry season burning of the savanna in the north of the country. This figure is scientifically measured and has been independently audited. In return for that 100,000 tonnes per annum, ConocoPhillips pays to the Northern Territory government the sum of $1 million per annum, which in turn is passed back to the land managers. Besides the financial benefit there have been significant biodiversity, environmental and social benefits across Arnhem Land as a result of this brilliant project.
However, the national carbon offset discussion paper proposes that the projected emissions from savanna burnings be deducted from the national emissions target, effectively destroying its commercial and environmental benefit. This would not only dispossess Indigenous people but remove a decade of incentive to continue this program. By contrast, it is offset markets which have the potential to make significant contributions to reducing greenhouse gas emissions and add to the sustainable development in both Indigenous and pastoral communities across the north. I do hasten to say that the Department of Climate Change has now agreed to reconsider its position on this. One can only hope that common sense will prevail over a scheme that Australia should be celebrating and supporting and selling to the rest of the world rather than excising from this particular project.
I conclude by reiterating the observation that Australia contributes only 1.4 per cent of the world’s carbon emissions. Moving into my world as a veterinarian, if the rest of the world’s contribution to carbon were represented pictorially by an elephant then Australia, regrettably, would be a very small bee. To think that the bee in some way is capable of influencing the direction of the elephant in this debate is simply arrogance. If the legislation passes, these are the inevitable consequences: Australian jobs are lost, our economy suffers, our industries lose their competitiveness internationally and, lastly and regrettably, there is no effect on global carbon reduction. (Time expired)
I thank the late Anita Roddick for the other analogy, following upon Senator Back’s reference to the bee and the elephant, which is: if you don’t think a small entity can change the world, think about the mosquito that comes into your bedroom at night, because it changes the whole way we think about whether we are getting to sleep or not. Yet what we have had from the opposition-side speakers tonight is speaker after speaker reference the insignificance of this great country of Australia. Senator Back says 1.4 per cent of emissions come from Australia. Well, we are 0.3 per cent of the world’s population. On the basis of our potential sportspeople, if we were to look at that statistic and say that we are insignificant we would never send a team to the Olympics—
Well, this is the analogy coming from your side, Senator Boswell. We would not have people aspiring to great achievements in the creative arts—in writing, in opera, in ballet—in the other sporting fields or, indeed, in science. In all of those things, in the last century or two Australia has not only been a world player but has played way beyond its statistics. That is because we had wealth, we had get-up-and-go and we had the zeal to show that we could be achievers in an otherwise huge and daunting world.
But the ‘daunting’ has overtaken the opposition. I am amazed that the National Party, of all parties, should be so transfixed by the insignificance of this country that their Leader in the Senate talks about the fact that Prime Minister Singh of India, President Hu of China, Mr Medvedev of Russia and Mr Obama in the United States do not toss and turn at night thinking about Australia—in other words, we are irrelevant to their thinking. It is a matter of pride and conceit—which come before a fall, says Senator Joyce—that we Australians think we should be able to go out and not only contribute to the world but take a lead in the world. I disagree. We Greens disagree. In particular, we disagree on one of the most overwhelming problems confronting the planet now, and that is climate change.
I go to the United Nations figures. Senator Milne quoted some of what the United Nations and the Intergovernmental Panel on Climate Change have been saying in recent months. They indicate that, in the last 12 months of statistics, 300,000 people around the world died because of climate change. It is not a thing for the future; we are moving into it. It is human made and it can only be fixed by human action. Senator Back spoke about food production. I ask all members of the Senate to consider this: we are just managing to feed a world of less than seven billion people, so how is food production going to cope when we move to nine to 10 billion people by mid-century when we will have cities taking over land? It is estimated that the impact of climate change, the issue before us tonight, will cause a massive reduction in food production in some of the most prosperous places in the world, not least Australia’s very own food bowl, the Murray-Darling Basin. Anyone who thinks the Murray-Darling Basin is not being affected by climate change, or will not be, should read Professor Ross Garnaut’s very daunting statement about failure to tackle climate change. He knows that Australia needs to take a lead. There is potential for 128,000 rural jobs to be lost from the basin and the collapse of its ability to provide food for a world that is going to need it so much.
This afternoon Senator Macdonald referred to my contribution to the debate on forests in 1998—over a decade ago. You would remember, Madam Acting Deputy President Troeth, that I tried very hard to get from the Howard government a definition of ‘ecologically sustainable forestry’, because that was the whole predicating factor of the Regional Forest Agreement legislation to which Senator Macdonald referred. In days of questioning, the then government could not give an answer to that. I will tell you why: because it knew that the legislation was in the interests of big corporate players in this country but would lead to the wholesale destruction of forests—and there was no sane argument, no logic and no ability to put forward a case that it would have been environmentally sustaining, let alone enhancing, for this country. Since then, hundreds of thousands of hectares of native forest and woodland have been destroyed in this nation—under the last government, supported by the Labor Party in opposition, and now under a Labor government—and every year we see hundreds of thousands more hectares being destroyed. These are the biggest terrestrial carbon banks—that is, bulwarks against climate change—that we have, and under the current Rudd government policy they are being destroyed.
A recent report from the Australian National University indicated that in the Central Highlands of Victoria are the most carbon-dense forests on earth. It is through Rudd government policy and coalition complicity that those forests continue to be logged at an awesome rate to provide woodchips to Japan, with massive amounts of greenhouse gases going into the atmosphere. Under the most forensic questioning that I could put to Senator Abetz, a former forestry minister—who would not answer—and now to Senator Wong, the Minister for Climate Change and Water, there are no figures to show what the greenhouse gas emissions from those forests are. We have had to leave it to university experts to look at that and establish that this is the biggest slaughter of carbon banks on the face of the planet. This is for a very tiny sectional industry—that is, the woodchip export barons—not for use here in Australia, and it is against the interests of this planet’s forward security. It erodes, by the way, the biodiversity of the planet as we know it. It is shocking, it is shameful and it is unforgivable in an age of climate change that this government, let alone the last one, cannot even tackle the loss of forests and woodlands in this country under government policy which causes the emission of 20 per cent of the greenhouse gases coming out of this nation. It is not a small figure when you consider the massive contribution from coal, transport and agriculture, the latter of which Senator Back gave a very reasonable speech about from a different point of view just before I got to my feet.
I point out that the current process in this chamber is about filibuster and delay by an opposition that does not want to vote on the issue. That is the height of irresponsibility. For better or worse, this nation wants this parliament to make decisions and hopefully, as Senator Milne said, we should not agree to make a decision unless it is the right one. We do not believe this is the right one, but at least we make up our minds on it and have a better option available. That is laid down in Senator Milne’s amendment, which I will of course be supporting, and that is where the government should be. But what we have from the opposition is a filibuster. After 13 years in government doing nothing on climate change, the opposition now wants to do nothing on this legislation. It wants to block this government and anybody else from taking action on climate change in this chamber. It is considering two outcomes: one is to not have a vote here and the other is to delay it till August, September or October through the good services of the Independents on the crossbench. Why? Because it is concerned about DD—and I do not mean doomsday for the planet if the ICCP is correct. That is not on the opposition’s agenda. It is self-invested concern about a double dissolution that it is trying to escape.
Finally, let me quote a comment from Mr Bernard Keane from crikey.com. On the politics of the day in this parliament, he said:
... the breathtaking hypocrisy is this. The Opposition and the media have worked themselves into a lather over the John Grant business—when the bloke got no financial assistance—but where’s the outrage over far more appalling examples of the Government looking after its mates and donors?
In the last 12 months one of the great heists of tax payers’ money has been perpetrated by Big Carbon. Resources companies and heavy energy users, many of them major donors to the ALP, have extracted billions in assistance from Government ... lobbying backbenchers, these ... low-lifes with their forecasts of doom and their ... modelling have directly lobbied senior Government ministers and for their efforts obtained massive handouts that will have highly-damaging long-term implications for our economy and our climate. The Government’s mates in the union movement have been in on the giggle as well.
If you want corruption of the worst kind, it has been on display since the ETS Green Paper was released last year. Right out in public sight.
Where’s the outrage over that from the Press Gallery?
By the way he is referring not least to $16.5 billion inherent in this legislation—to go to whom? Not the sufferers, not the people who may need assistance, not the farmers that Senator Back was just talking about who may need $2 billion on his figures. No, it would go to the polluters. The more you pollute, the bigger the handout under this government arrangement. To return to the article:
Where are the furious editorials and mocked-up emails from News Ltd papers? Where’s the harassment of public servants at their homes on this? Only a couple of Gallery journalists have reported it. Many others have actively served as an echo chamber for the rentseekers.
No one will remember Ozcar in five years. Unfortunately we can’t say the same about climate change. Our capacity to lose perspective is remarkable.
We have no excuse. I again put this down on the record. Every single member of this Senate is responsible for this nation’s response to climate change and for the onrush of the gargantuan threat of climate change to our economy, our lifestyle, our environment and the rights of our children, our grandchildren and their children and grandchildren. That is what is at stake.
I begin my remarks this evening on the Carbon Pollution Reduction Scheme Bill 2009 and related bills with what is agreed by almost everyone in this chamber and that is to quote the majority report of the Senate Select Committee on Climate Policy:
The balance of the evidence ... suggests that climate change is occurring, is driven by anthropogenic factors and is a grave threat to accustomed ways of life and natural systems.
Those are Senator Colbeck’s words, not mine. I say almost everyone agrees with this statement because clearly there are some exceptions. One of those exceptions is a fellow senator from my own home state, Senator Cash, and indeed probably Senator Boswell as well. Senator Cash, in her own separate qualifications to her coalition colleagues’ majority report, said that she rejected that conclusion. Senator Cash also said that despite this rejection of the science she still believes the planet deserves the benefit of the doubt. But, although she believes the planet deserves the benefit of the doubt, she does not believe that we have a responsibility to act—or at least not before Copenhagen and not before the Obama administration does. So climate change becomes not our problem, it seems, but someone else’s responsibility. Senator Cash argues that to act prematurely would be to the detriment of Australians. She says it would cost jobs, especially in Western Australia.
Sadly, her arguments are typical of those opposite. It is not a fact. It is very typical, however, as Senator Cormann has just proved my point. It is a typical argument of those opposite. They try to have a bet both ways on the science when the evidence indicates that we face a very grave climate risk. They talk of risks to the economy from the CPRS but ignore the risks of not acting on climate change, especially the risks to my home state of Western Australia—indeed, your home state, Senator Mathias Cormann.
They ignore the fact that south-western Australia’s significant drying trend is set to worsen under climate change, leading to 80 per cent more drought by 2070. They ignore the fact that the mean rainfall has declined dramatically in the south-west since the 1960s, causing an even more dramatic decline in downflows. They ignore the threat that climate change poses to Western Australia’s valuable agricultural industries if these trends continue unabated. There is a threat to our fisheries, especially our $300 million rock lobster industry, if the oceans warm and indeed acidify as expected. There are real jobs at risk in all of these industries if climate change continues unabated.
The international community needs to act on climate change and we need to be part of that deal. There is a very grave threat to homes and communities concentrated on the coast in Western Australia if sea levels rise as anticipated. There is also a threat to human health if temperatures continue to rise. In Perth, for example, where there are plenty of very hot days already, it is a regular occurrence for people to die. In fact, around 300 people over the age of 65 per year already suffer heat-related deaths.
You can deny that these are the impacts of climate change, Senator Cormann, but I do not. These are very real impacts.
Senator Cash may say that she believes that the planet deserves the benefit of the doubt, but she does not mention these risks. These risks simply do not count for her, and clearly they do not count for the opposition. But these are the very credible risks of climate change for my home state of Western Australia. Instead, Senator Cash speaks of the jobs at risk in Western Australia in the mining and resources industry. But she does not bother to mention that the mining council itself admitted during the Senate Standing Committee on Economics inquiry into the bill that, even if the CPRS were introduced, the mining industry would continue to grow. So much for massive job losses!
Most importantly of all, Senator Cash and others like her base their case on a very wrongheaded choice: a devil’s choice between showing good faith in the lead-up to Copenhagen and purportedly saving Australian jobs. But this dichotomy is a false one, and unless it is exposed as false not only will we fail to do all we can to shore up a strong global agreement on climate change that places the interest of the planet front and centre but our economy will suffer as well. In a competitive global economy, it is those businesses and industries that adapt to change in the international environment that thrive in the long term. The international environment is changing as the world gears up to face the reality of a carbon constrained future—one that the opposition refuses to confront.
Many countries are already to moving to put a price on carbon, to encourage innovation and reward effort to minimise emissions.
The action being taken by other economies, both developed and developing, is outlined in an appendix to the government senators’ report of the Select Committee on Climate Policy, and I suggest you take a look at it. This evidence demonstrates that it is simply untrue to say that Australia would be acting alone or acting prematurely if this legislation were to pass prior to the Copenhagen conference. We are simply not acting alone or early. Other countries are acting now because they know that by acting now they will ensure that their enterprises, their industries and their economies will thrive in the long term, for the day will come when countries will no longer be able to afford not to have a price on carbon—and that day will come sooner than we think. The reality is that carbon emissions have an economic cost, and businesses that emit carbon must be able to bear a reasonable proportion of that cost or they will not survive long in a world which increasingly demands the cost of carbon pollution be recognised and allocated appropriately.
Imagine how we would react to a company that sought to operate as though labour could be had for no or very little cost, a company that saw slavery as a sustainable approach to the procurement of labour. Yet many businesses once defended slavery as an economic necessity, and those opposed to it were condemned as bleeding heart liberals. Lord Puttnam made this very point in the debate on the climate change bill in the UK parliament 18 months ago. He said:
Two hundred years ago, slavery was perhaps the primary source of energy, a cheap and apparently infinite generator of power, and regarded by many as the foundation stone of British commerce and prosperity. As with our energy industries today, slavery appeared to represent a large and vital component of the economy. At the time of its abolition, the slave trade and its associated activities were reckoned by those opposing the Bill to account, quite astonishingly, for well over a quarter of this nation’s GDP, a fact which helped to drive one of the central arguments deployed by the anti-abolitionists …
Conservatives defended slavery on the basis that industries were not sustainable without it. Conservatives also argued that, if businesses in one market stopped using slaves, they would lose out to competitors in other countries that did.
The irony, of course, was that, whilst slave labour might have been cheap, it was also extremely inefficient because while labour was cheap there was no incentive to use it efficiently. And so it is with polluting sources of energy. That is why parliament had to step in and say, ‘Regardless of vested property rights, this immoral use of resources has to stop.’ Fortunately, the UK parliament did take a stand on slavery, and of course it turned out that chains and whips were not the best means for maximising labour productivity. In fact, the abolition of slavery in Britain 200 years ago helped drive the industrial revolution in that country, which saw the British economy lead the world for the next century. To quote Lord Puttnam again:
… those same vested interests who argued that a speedy end to the slave trade would be ruinous were profoundly wrong. In fact they were doubly wrong. Far from proving damaging, the abolition of the slave trade allowed Britain to leap forward, as if a metaphorical ball and chain had been lifted from the economy. Slavery, far from being the foundation stone of prosperity, had in fact been a colossal impediment, a hindrance to the development of more efficient business formations, leading to the generation of many new forms of wealth and success. Not only had it been morally repugnant, it proved to have been economically illiterate.
We can see the way business changes happen over all time as norms about the efficient and ethical use of resources change, whether those resources are human beings or, indeed, a liveable planet. One of the consequences of failing to adapt as the world changes is that when change is finally forced upon us we will not be up to the challenge. This is why in the UK business is so positive about the British government acting on climate change. As James Cameron from Climate Change Capital explained to the Senate Select Committee on Climate Policy:
It is of no surprise that the CBI—
should be an advocate for economic instruments to reduce greenhouse gas emissions across the UK economy, and it is of no surprise to see them argue for greater clarity and a longer term framework for public policy to reduce emissions, because the CBI wants to see UK business position itself to be a winner from the technological and business innovation associated with coping with climate change.
And if we do not move with the times in Australia we will fall behind. As John Connor from the Climate Institute told the Senate Committee on Economics:
… if Australia does not get on board this train soon, we will be left behind. Our tragic history is one of coming up with the good ideas, but allowing that to go overseas for jobs and profit.
The change of pace is indeed much faster now than it was two centuries ago, when Britain abolished slavery. Climate change demands an urgent response, and the modern global economy, for all its imperfections, is sophisticated and flexible enough to respond fast. Businesses that persist in proceeding as though carbon does not have a price, has a very low price or has a price that someone else should bear will soon seem hopelessly antiquated. The failure to put a price on carbon will have a deadening effect on our industrial innovation and competitiveness.
Emissions intensive industries need the benefit of a framework in Australia within which they can acknowledge their carbon liabilities if they are to move forward, and the legislation before us provides just such a framework. Low-carbon industries need a framework to guide investment decisions in order to take advantage of new business opportunities. As the Howard government’s own Shergold report predicted, the lack of any such framework is already imposing real costs on Australian businesses today. That is why a very wide range of business and industry witnesses, including the Australian Industry Group, the Business Council of Australia and the Australian Bankers Association, all told the Senate economics committee that business needs legislation this year to put an end to ongoing uncertainty.
Uncertainty is the enemy of investment and therefore of job creation. If we do not act now, rewards will be distorted. If we do not act now, the industries of the future will struggle to get off the ground, while those that must adapt to survive will put off until tomorrow what should be done today. Investment will be misdirected and opportunities will be lost. When the rug is pulled out from under our feet, our industries will prove incapable of surviving in a carbon constrained world. We will be left living in a carbon intensive cul-de-sac, with declining living standards and vanishing job prospects.
It can be argued that slavery still exists in some parts of the world. Yet those places are not beacons of liberty, prosperity and progress. They are backward places of tyranny, poverty and despair. It is those that abandoned this reactionary way of doing business, those that accepted their moral responsibilities, those that looked into the future, that have grown and prospered. As with the transition from slave to free labour, so with the transition from high pollution to low pollution. In this case, too, the right thing to do is also the smart thing to do. The smart thing to do is to give Australian industry every opportunity to adapt swiftly and seamlessly to the reality of a carbon constrained future.
Passage of the CPRS legislation will encourage industry to continue to improve its performance in relation to emissions. It will encourage investors and businesses to take advantage of emerging opportunities in a carbon constrained environment. It will support emissions-intensive trade-exposed industries to enable them to maintain their competitiveness through the transition. If we act wisely, we can have a healthy planet and wealth in our pockets. The moral imperative and the economic imperative are not in conflict here. They are, Senators, one and the same.
To those who believe this bill does not go far enough, I have this to say: yes, we could have acted earlier. If we had, we might well be in a position to do more now. But that delay was not of this government’s making and we cannot undo the past. If we try and turn this corner too fast we will lose control of the process and we will not have a smooth transition. There will be social and economic dislocation and the political will for change will be lost, and that is not going to benefit anyone, least of all the planet. Of those senators who do not accept this argument and who still believe this bill is not enough, I ask: when we agree that we have waited for too long already, how does further delay help?
The Europeans have capacity to now finetune their ETS because it is already in place. They are reaching higher now because they are able to draw on experience of their own schemes in action in the context of their own specific economic circumstances. In those countries, people can now see in practice the economic benefits of acting on climate change. They can see that the predictions of the sceptics, the doomsayers and the rent seekers have not come to pass and so they are prepared to do more and to move faster. We do not have that advantage, and we never will unless we make a start. Delay now will not help us reach a higher target; delay will certainly mean that our carbon pollution will continue to increase and increase—year by wasted year.
If we pass this legislation, we will give business the certainty it needs—the certainty it is demanding—to begin making the investments needed for the transition to a low-carbon future. Without legislation there is no certainty and no new beginning. We will not learn more or achieve more by further modelling or by grandstanding—we are way past that point. We will learn more by doing—by making a start. Climate change is the great challenge of this century and we need to put our shoulders to the wheel. We need to take this first, vital step towards a better future now. I urge all senators to vote for the second reading of the bills.
The Senate is debating the government’s controversial and economically extremeCarbon Pollution Reduction Scheme Bill 2009 and related package of bills. About the only thing accurate about the name given to this legislation is that it is a scheme. It is a scheme to send tens of thousands of jobs offshore; devalue our greatest mining and energy assets; raise costs to every business, every farm and every household that uses energy; help our international competitors steal our markets; increase global carbon emissions by penalising Australian carbon-efficient industries; churn billions of dollars from the private to the public sector to be redistributed according to the public sector; and make winners out of rent seekers.
The CPRS is a scheme that totally fragments Australia’s operating system but does not put it back into a coherent, workable shape. It demobilises our export army and does all this without having global cooperation. It does this without having modelling of what will happen to all our industries over the next decade. The blue-collar workers, the foot soldiers—particularly those in regional Queensland and regional New South Wales—will pay the price of Labor’s scheme to win the green vote.
The CPRS is Rudd’s cunning plan to put on a green camouflage to win votes and preferences in key metropolitan seats. But it is just a suit of cover—the camouflage is not real. If Rudd were serious about being green, he would have made sure that we do not send emissions offshore. This will happen as surely as night follows day, because costs in Australia will increase while those of our competitors will not. We will lose business, companies will be relocated to countries where there are no restrictions and manufacturers here will become merely distributors. If this were really true green legislation, do you not think that the Greens would support it? They do not—they know it is a con. We know it is a con and farmers and miners know it is a con. When food, fuel and power prices go up, the Australian people will know it is a con too. The CPRS is the greatest burden ever invented to put on a trade-dependent nation with natural competitive advantages in mining, in agriculture and in low energy costs.
The political calamity of having so many Labor states as well as a federal Labor government is that the states are not exercising their usual role of holding the Commonwealth to account. The most outstanding example of this is the absolute silence from Queensland, the state most affected by CPRS. Despite chairing the Council for the Australian Federation and commissioning research on the impact of CPRS, Premier Bligh has said nothing about the results. She has been silent on all the jobs to be lost and the communities to be disadvantaged; at no time has she stood up to the Prime Minister and demanded that Queensland be treated better or, at the very least, fairly, with proper compensation.
These are some of the findings of Premier Bligh’s own commissioned research. She commissioned it; it was not the mining industry and not the coal industry. It is the Premier of Queensland’s own research. This is what it says:
Queensland is expected to experience the greatest impacts from the CPRS by 2030 due to its heavy reliance on coal fired electricity, aluminium smelting and strong concentration of exported coal mining production.
I continue to quote from her research:
Queensland is projected to experience the largest percentage decline in GSP by 2050 of around 6-8% relative to the reference scenario.
Relevant to the reference case, by 2020 thermal coal output would fall by 37.5 per cent, coking coal by 11.9 per cent, aluminium by 31.9 per cent and alumina by 12.5 per cent, and electricity generated output would collapse by 45.7 per cent.
Interestingly enough, those figures, while not exactly the same as the coal industry and mining industry research, are relatively close. The price for domestic fuel and power in Queensland is expected to increase by 24 per cent by 2025 and the transport prices are expected to increase by nine per cent by 2025. The impact on employment growth to 2020 shows the CPRS will cost Queensland 28,000 full-time positions. Again, this is her research.
The north-west is expected to experience a seven per cent drop in employment and a nine per cent drop in output due to dependency on oil and gas. The Fitzroy region would see a loss of 3.4 per cent in employment and 5.5 per cent in output, and the Mackay region would experience falls of 3.3 per cent in employment and 4.7 per cent in output. Wages in 2025 would fall by 5.15 per cent. And where is the Labor Party, defenders of the blue-collar workers? They are sitting there like stunned mullets.
These conclusions lead to grave questions which Premier Bligh and fellow Queenslander Kevin Rudd should answer. Is there an agreement between unions and government on this significant fall in wages at a time when fuel and power prices will be soaring and 28,000 jobs will disappear from the state economy? The unions have a lot to answer for in this debate. Union leaders are spruiking green jobs when they know that there are no green jobs for sacked coalminers in Central Queensland—certainly none that pay as well as mining does. Labor has dudded the blue-collar workers in this ETS. Neither the state government on the east coast nor the union leaders are standing up for their jobs. What actions has the Queensland government taken to make up for the substantial loss of revenue as a result of the job-destroying ETS? What programs will be cut or taxes raised? Two billion dollars will be lost in coal royalties. By 2020, where will Queensland get its power from, at what price and how many jobs will be lost in the process? What actions are both governments going to take to prevent the substantial damage to industry and employment in these regions?
The international situation is also highly relevant to this debate. In fact, it lies at the centre of the dilemma of the treatment of the trade exposed industries. From our very first beginnings, wool pioneer John Macarthur saw that Australia’s survival depended on selling our goods across the globe. He was the nation’s first globalist and trader. Australia must not do anything to undermine the competitiveness of our industry. Everything depends on it. Yet what do we have before us? A scheme to do just that—to put the cost on our exporters and domestic producers so that overseas competitors will take their markets from them. In a strange twist the CPRS is modelled on overseas countries coming in very early with emissions restrictions. We are then told by the same Treasury officials that Australian industry will not be hurt so badly because our competitors’ markets will not have emissions restrictions and so will keep the demand up for our products like coal. You cannot have it both ways. What I learnt from Treasury modelling is that you can model black as white and white as black; you can model anything you want.
The whole international problem is that large emitters like China, India and Russia will not act without substantial cuts in emissions from developed countries that are also expected to fund poorer nations. Efforts on climate change will have to be funded by wealthier nations. Tom Switzer wrote in the Australian Financial Review last week that the United States bill faces a roadblock in the senate, which means the climate bill will probably crash to defeat as a similar bill did last year. Switzer, who works at the United States Study Centre, comments that:
… anything short of a genuine global accord on sweeping, mandatory and enforceable cutbacks on emissions is self-evidently futile. That is why the prospects for a post-Kyoto climate deal in Copenhagen are not looking too hot.
Meanwhile, the Rudd government assumed the US would begin an equivalent scheme by 2010, China by 2015 and, finally, India by 2020. I do not know when they put Russia in, but none of this is remotely possible. Meanwhile, AgForce Cattle warned in their statement on 3 June:
We need changes to international rules which allow farmers to include soil carbon sequestration and the carbon sequestration of pasture plants. Food security policies would also rely on accounting systems which make a differentiation between biological emissions which are part of farming—
I wish they were right, but I do not think they are going to get it—
grazing and food production (including biological sequestration), and the emissions from fossil fuel use.
With more than 65 percent of Queensland beef production destined to feed people outside Australia, the impact of the current CPRS on reducing our production becomes a very real threat to world food supplies.
The ABARE modelling shows production declines in 2011 and 2015, which highlights why households both in Australia and overseas should be worried about where their protein and nutrients will be coming from in future.
… … …
AgForce Cattle board has reviewed in detail the reports by the Australian Farm Institute … and Professor John Rolfe which all point to even more serious financial and economic drops if CPRS comes into effect.
Beef producers are alarmed by the forecasts. These reports generally point to a meat production reduction by 2030 of 25 percent. For beef producers across Queensland this is a terrifying prospect.
ABARE found that sheep farmers would also fare badly, losing 17 per cent of income, with broadacre industries and dairy farmers losing between 11 and 15 per cent of their income. The government claims support from business groups but, as with so many aspects of the Rudd government, you have to look behind the spin. The Business Council of Australia wrote to the opposition on 4 June, saying:
The legislation released last week does not include the critical details related to the defining and treatment of individual emissions-intensive, trade-exposed industries. It has been suggested much of this detail will not be available until later this year, but it is this very detail that will be critical to businesses. Firms must know what aspect of their business will be included in the scheme and the level of permits they will receive—
and whether their competitiveness will be maintained. They also said:
There remain major concerns relating to the treatment of the coal industry under the CPRS where coal has been excluded from the emissions-intensive trade-exposed industry arrangements, although it meets the threshold test.
… … …
The CPRS plans to include fugitive emissions from coal mines, yet no other coal producing country has included, or is contemplating including, fugitive emissions. What remains essential is establishing arrangements that ensure the competitiveness of this vitally important industry is sustained and jobs are not lost in the absence of a global approach to reducing greenhouse gas emissions.
Those statements do not in any way say, ‘Go ahead, Mr Rudd, we’re right behind you.’
As the Australian Food and Grocery Council told the Senate Select Committee on Climate Policy, if a policy of this magnitude is going to be implemented then it must be done right. But it is not being done right. If the flawed policy is implemented, it will mean exporting jobs and emissions offshore while doing very little to reduce environmental impact.
Under this ETS, from 2012, Australia’s energy intensive export and import competing industries will be paying billions of dollars of tax, increasing each year, while the same industries in the United States will have 100 per cent protection through to 2025 and potentially well beyond if other major competing countries have not come on board. Yet even the US scheme recognises the need for a climate change worker adjustment assistance scheme in their legislation. There is no such thing in the ETS before us today in Australia, and that is an indictment on the Labor Party.
The US is establishing a program to entitle any worker displaced as a result of their Clean Air Act to 156 weeks of income supplement, 80 per cent of their monthly health care, up to $1,500 for job search assistance, up to $1,500 for moving assistance and additional employment services for skills assessment, job counselling, training and other services. Where is Australia’s ETS worker assistance scheme? Federal Labor MPs and union leaders in the coalfields are not standing up for their constituents. They are not fighting to keep local jobs or help workers displaced by the ETS.
The Climate Institute has released a list of green jobs, but there are virtually no jobs for miners in Central Queensland and no green investment dollars going there either. What is the government going to do for these people and their communities? Why hasn’t the government included specific assistance for working families that would lose their jobs in the emissions trading scheme? Labor’s ETS is about closing down coal and running the economy on renewable power. It costs $40 per kilowatt hour to power a factory with coal, but it costs $100 per hour to power a factory with wind and $200 per hour to power a factory photovoltaic cells. How on earth does Australia compete with these cost disadvantages? Consider also that the Treasury modelling assumption of no net loss of employment across the nation worked only because of a predicted decline in real wages of 10.3 per cent. This will come at a time when there are significant price hikes in fuel, food and power under the ETS.
The Energy Supply Association of Australia says that electricity prices will rise between 40 per cent and 50 per cent by 2020. As a direct result of the ETS and the renewable energy target, these price hikes will be on top of already-increasing electricity prices. On 1 July this year, retail electricity prices in Queensland will increase by 11.63 per cent and will skyrocket by more than 20 per cent in New South Wales. Wait until you get the ETS! Once again, union leaders have failed to tell their members what the Treasury model means for them.
I asked at Senate estimates whether it is possible that real wages could decline in the short term and that unemployment will go up. The reply from Treasury was:
Relative to a world without emissions pricing, yes, it is possible that employment will be lower than it otherwise would have been and real wages might be lower than they otherwise would have been ...
Then I said:
Firstly, you are assuming that everyone is coming in and, secondly, you are putting in your models that there is going to be no unemployment. Of course you are going to get the answer there is not going to be unemployment.
The answer from Treasury was:
In the long run, yes, that is true.
Make no mistake: the ETS is a lobotomy on the Australian economy; the price is enormous in terms of jobs, exports and regional communities. Why the unions are falling for this and betraying their members is beyond me. I can understand where the Greens are coming from, but I cannot for the life of me understand how the Labor Party can sit there and watch unions, who take $800 from each member in union fees, just go out of existence. You ought to be totally ashamed of yourselves.
I rise to speak on the Carbon Pollution Reduction Scheme Bill 2009 and related bills. Many people in this place will know that, before I entered the parliament, I was the coordinator for the Conservation Council of Western Australia. Prior to that I worked in agriculture, so I have some experience dealing with the issue of climate change. For over two decades I have been personally involved in this debate and it saddens me that some people are still questioning whether or not climate change is real and we are still debating what we are going to do about it.
You have only to look at my home state of Western Australia to know that this debate is not theoretical. We have seen the impacts in the east, but we are also seeing the impacts in Western Australia. In fact, Western Australia was one of the first places to see some of these impacts. Rainfall in the south-west of Western Australia has already decreased by 21 per cent. This has resulted in a decrease in run-off of 64 per cent. These are not figures I have plucked out of the air; these are real figures.
In 1995, the Western Australian government realised that something was happening to our rainfall events and started to plan differently for the way they would manage our catchments and water resources. Some of us were critical that they did not go far enough, but at least they acknowledged that there were issues there. I am not saying that it is totally the result of climate change; it is the result of natural variation and climate change. I hesitate to say that I expect that those figures are going to get worse—that drop in rainfall is only going to get worse. In Western Australia, we already know what it is like to live with a changing climate. The impacts on our wetlands, biodiversity and agricultural systems are also starting to be felt. In fact, it has been noted in Western Australia that some of our farmers are some of the most efficient and effective in the world. They are good at adapting to a changing climate, but the point has been made in WA that our farmers can only adapt so far and they have reached the point where they cannot adapt without having different crops to plant and a great deal of systems support.
I did not interject during your comments, Senator Boswell, so I would appreciate it if you did not during mine. Agriculture in Western Australia needs to adapt to changing climate. As I was saying, they have been very good at adapting to a changing climate but there is only so far they can go. One of the things about climate change is that we know that not only will the climate get drier but there will also be variations in seasons and there will be a greater variability in seasons. Western Australia is also recognised as a global biodiversity hot spot. Not only have we over-cleared our vegetation but through over-clearing our native vegetation we have taken away our biodiversity’s capacity for resilience. We have not in Western Australia, or in fact in Australia, built biodiversity resilience into our planning, so not only has Western Australia already lost much of its biodiversity but also even more of it is now at risk from climate change. A quarter of WA’s 100 banksia species are predicted to disappear in their current range, under what are pretty conservative models. By 2050, it is estimated that WA’s sheep and wheat production will shrink by a quarter under the scenarios predicted for climate change. Seventy per cent of the Great Southern area of Western Australia is covered by agribusiness and that is a key contributor to the economy. Just think about what it will mean if agriculture shrinks by a quarter. What impact will that have on our economy? What impact will that have on jobs?
Similarly, in the fishing industry, WA’s rock lobster fishery is already going through a substantial change at the moment, with declining harvests. It is thought that at least part of that decline is due already to the impacts of climate change. Those who understand the Leeuwin currents and the flows on the Western Australian coast would understand why people are deeply concerned about the impacts of climate change. The impacts on Western Australia’s health are also of great concern. As you get more climate change, you get heavier rainfalls moving further south into Western Australia. People are concerned about what impact that will have on health and the spreading of disease. Again, the Western Australian government quite some time ago recognised these potential problems and has in fact been looking into those issues.
The point here is that Western Australia is at great risk from climate change in terms of its impact on our biodiversity, the impact on our economic production and the impact on our health. In other words, the triple bottom line is affected by climate change. Western Australia’s economy is largely resource based. People made much of our economic growth through the mining boom, but mining has not delivered for all Western Australians. I released a report in 2007 entitled The boom for whom. This report looked at the impacts of the boom in Western Australia and the so-called benefits for ordinary Western Australians. It showed that while the economy was being driven by the mining sector and wages rose dramatically in the mining industry, unfortunately that was not reflected in other sectors. For example, average wage rates in the hospitality sector increased by only 2.4 per cent in the 12 months during which the report was written. This was less than half the growth in mining and construction industries, and lower than the inflation rate. A paper recently produced by the Australia Institute entitled The benefits of the mining boom: where did they go concluded:
Overall, it is hard to identify the benefits to ordinary Australians of the mining boom. The estimated nine per cent increase in real incomes from the terms-of-trade changes do not appear in the figures for wage earners or recipients of government income-support payments. It seems that the benefits of the boom barely went beyond the mining industry itself. Indeed, higher mortgages and other borrowing costs meant that many households were worse off as a result of the mining boom.
The mining boom is not a sustainable way of creating an equitable, green economy. The point I am making here is it is time Western Australia expanded beyond our resource based thinking. We need a much more diverse economy.