Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Climate Change and Energy Efficiency, Senator Wong. Given President Obama confirmed last year that the United States would not have a carbon tax or any equivalent price on carbon by 2016—which is contrary to a key assumption made by the government in its carbon tax modelling—does the government now accept that the impact of their carbon tax on the cost of living, on the economy and on jobs will be much worse than they have tried to make people believe based on their now roundly discredited modelling report?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

It is interesting, is it not, in a week when we will be debating the minerals resource rent tax and on the day on which the government, on the basis of the announcements made—

Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Mr President, I rise on a point of order relating to the requirement to be directly relevant. As much as I would like to ask the minister a series of questions on the mining tax, this is very clearly not a question about the mining tax. So for the minister to start answering the question by talking about the MRRT is clearly the minister not being directly relevant to the question. I would ask you to direct the minister to be directly relevant to the question asked.

John Hogg (President) Share this | Link to this | Hansard source

There is no point of order. The minister has been going for only 12 seconds and has one minute 48 remaining. I am listening closely to the minister's answer.

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

I was making the point about the choice of the question. I am happy to get to the question, but it does say something when one of the opposition's economic spokespeople in the Senate, in this week when we are debating the minerals tax and when announcements have been made by the crossbenches, wants to talk about modelling on legislation which has already been passed.

I turn now to President Obama's statement and to the misstatement that we can again see in Senator Cormann's proposition to me—a proposition Senator Cormann has made over and over again. He was told in Senate estimates some time ago that what he was putting was wrong, but he does not listen because it does not suit his argument. He was told that it was wrong to suggest that the Treasury modelling of the government's plan depends on the United States putting a price on carbon by 2016. Would the senator like me to repeat that again? He is wrong to assert that Treasury modelling of the government's plan depends on the United States putting a price on carbon by 2016. It is the same proposition he put over and over again in Senate estimates in a desperate attempt to drum up some alternative response from Treasury officials, who continue to say, 'We can grow our economy, we can grow jobs, we can increase our incomes and we can reduce emissions from what they would otherwise be with a carbon price.' But yet again we see Senator Cormann, like a dog with a bone, trundling out the same old arguments and the same old lies.

Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. Given that Treasury's modelling of the carbon tax impact is based on the US joining with Canada, Japan, India, Korea and China in an international carbon trading system by 2016, even though none of those countries are likely to adopt such a scheme, by how much more will the cost of living go up as a result of the carbon tax and how much higher will costs to the economy be because the government's assumptions turned out to be absolute false?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

What is absolutely false is that question and the senator knows that because he has been told that over and over again by Treasury officials and by me in this place. He was told by Treasury officials that the assumptions were that countries which have made pledges under either the Cancun or Copenhagen conventions will implement policies to achieve those pledges. What we are assuming is that there are mechanisms in countries which result in either an implicit or explicit carbon price. It does not mean—I will say it slowly—that it specifically has to be an ETS within all countries. It does not mean that. Treasury is assuming that the US will do what it has pledged to do, which is precisely what President Obama said last week. Treasury is assuming that the US will do what it has pledged to do. That is not a controversial proposition. (Time expired)

Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Will the government redo all of its carbon tax modelling based on the real world before the carbon tax comes into effect so that Australian families and businesses can know how much more they will have to pay as a direct result of the carbon tax?

Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Link to this | Hansard source

The government has done modelling based on the real world. If Senator Cormann wants to talk about the real world, he might like to talk about how much more he would have to tax people to pay for the opposition's direct action policy were they ever to win government. If, as a member of the so-called economic team from that side, he wants to know about the real world effect, he might like to go out and talk to real businesses about the real world effect of the uncertainty he is demanding they live in, the uncertainty he is lobbying for and advocating for by telling people not to obey the law of the land, telling people that their permits will be torn up. That is economic lunacy and economic irresponsibility at its worst. A member supposedly of the economic team on the other side surely would think twice about advocating something so economically irresponsible.