Wednesday, 10 October 2012
Questions without Notice
My question is to Senator Ludwig, representing the climate change minister. Does the minister still stand behind the government's prediction of $29 per tonne for the carbon price in 2015-16?
I thank Senator Ian MacDonald for his question. What I always do is not take what they say as a written rule. What I would prefer to do in many instances is make sure that the question has in fact got the facts correct. That is why, if you look at the best way to seek to have a carbon price, it is to set it through a fixed period and then move to a emissions trading scheme. There is a clear path in moving that way and we stand by that path we are leading through. If you look at the opportunities that are there, it is the best way to reduce and remove emissions from our system.
Thank you, Mr President. Again, it is an area where I do not accept what the opposition have said. The modelling has assumed $29 in 2015-16 on the basis of a world price consistent with the low end of the 2020 emissions reduction pledges made by 89 countries through the UNFCCC process.
Let us be clear about what this means. Nearly 90 countries have made 2020 pledges to reduce emissions. That was on the basis of our modelling and it is not in a vacuum. What those opposite are claiming is that we should disregard international action and we should not use the most comprehensive modelling available to us.
Mr President, I raise a point of order on the issue of direct relevance. We have given the minister all but eight seconds to address a very simple and specific question: does the government stand by the prediction or doesn't it? That is all the question asked. The minister was obviously embarrassed by being unable to respond or he would have done so in the minute and 52 seconds he has taken, but you should direct him to answer the question.
Mr President, on the point of order: this is just such a beat-up. The minister has been answering the question. He was asked about the prediction based on modelling and, as he is explaining, this prediction is not in a vacuum. I am trying to listen to the minister, I must say, and it is near impossible with all the noise coming from the other side.
Opposition senators interjecting—
Mr President, I thank Senator Wong for the answer to that question, as Senator Ludwig should too, and I have a supplementary question. If I heard you correctly, Senator Ludwig, you said the government does stand behind the $29 per tonne carbon price for 2015-16, which is the modelling. Minister, if you believe it is going to be $29 per tonne in 2015, why is the government removing the $15 per tonne floor price?
I will take the interjection from Senator Cormann. He does not get it. He has deferred this question to Senator Macdonald because he does not want to be embarrassed asking it. Clearly, what he has missed is that the government stands behind the extensive modelling carried out by Treasury. We are confident of the work that Treasury has done. It has proven to be accurate since the price came into effect. You only have to look at the issue of electricity prices, where the price impact announced by regulators was consistent with the Treasury modelling. Unlike those opposite, who then decried—
Mr President, I raise a point of order on direct relevance. All I asked Senator Ludwig, or Senator Wong—whoever wants to answer it—is: if they rely on the modelling, which is $29 a tonne, why are they having a floor price of $15? I am not interested in what he is talking about now. Can he tell me why they are having a $15 floor price if $29 is the modelling and what they are anticipating?
The government remains—and this is the point that Senator Macdonald seems to miss out on—committed to the Treasury modelling. The carbon price forecast to result— (Time expired)
Mr President, I have a further supplementary question. Minister, isn't it a fact that the government's future financial forecasts are based on $29 per tonne? I am asking the minister what information he has about when we go to the European price. The current European price is $8 per tonne. What does the government know that anticipates that that will increase from $8 per tonne to the $29 per tonne the government is relying on?
Well, one of the difficulties for Senator Macdonald is that it is an attempt to link two different parts together. The carbon price projections in the budget are the result of extensive Treasury modelling. That is a given. The government stands by—and I have continued to say that throughout this confused questioning by Senator Macdonald—the extensive modelling carried out by Treasury. Their work has proven to be accurate since the price came into effect, which those opposite continue to complain of and decry.
Mr President, I raise a point of order on direct relevance. Again, I point out that I have asked Senator Ludwig what information he has that leads the government to believe that the $8 European price today will increase to $29. I am not interested in what he is rattling on about. Can he answer the question, please?
Thank you, Mr President. I continue to thank Senator Macdonald for his confused question. He remains confused, I have no doubt, notwithstanding even the question he asked. The point is the Treasury modelling is what the government stands behind. It has been effective. It has worked. It has clearly already predicted the price on electricity. (Time expired)