Monday, 17 March 2014
Clean Energy Legislation (Carbon Tax Repeal) Bill 2013, Ozone Protection and Synthetic Greenhouse Gas (Import Levy) Amendment (Carbon Tax Repeal) Bill 2013, Ozone Protection and Synthetic Greenhouse Gas (Import Levy) (Transitional Provisions) Bill 2013, Ozone Protection and Synthetic Greenhouse Gas (Manufacture Levy) Amendment (Carbon Tax Repeal) Bill 2013, True-up Shortfall Levy (General) (Carbon Tax Repeal) Bill 2013, True-up Shortfall Levy (Excise) (Carbon Tax Repeal) Bill 2013, Customs Tariff Amendment (Carbon Tax Repeal) Bill 2013, Excise Tariff Amendment (Carbon Tax Repeal) Bill 2013, Clean Energy (Income Tax Rates and Other Amendments) Bill 2013; Second Reading
I am in continuation. I think it is very important to acknowledge that one of the key elements of the RET has been its bipartisan support to date, which has helped to drive investment in the sector. This goes to the importance of certainty in energy policy, so any modifications ought to be bipartisan. We also need to consider whether the National Electricity Market rules should be reformed as part of an overhaul of our energy policies, and they must be.
The political debate over the past few years has been narrow and simplistic. To suggest or imply that the carbon tax is the primary cause of electricity price increases ignores the fact that charges for the use of electricity transmission and distribution account for about half of electricity bills. Currently these charges are paid by retailers, who then pass them on to consumers. The doubling of retail tariffs over the past few years can be directly related to the rise in network tariffs. Network tariffs are regulated by the Australian Energy Regulator, which is part of the ACCC. The rules governing how networks are regulated oblige the AER to provide network businesses with a guaranteed return on their investment regardless of whether the investment was necessary or worthwhile and regardless of whether the investment is later found to be unnecessary or premature. We need to reform that so that we can take into account the fact that these networks have been gold-plating their assets, to the detriment of consumers.
Currently, at subsequent five-year regulatory resets, the code allows the regulator considerable discretion in how it implements economic regulation. We need to reform the system of having these ex post reviews of transmission investments to determine whether all capital expenditure incurred was efficient or ought to be recoverable through regulator charges. That is what used to occur, but in 2003, influenced by strong lobbying from the network businesses, the ACCC, looking for an easier life for itself, moved away from ex post reviews in favour of a 'lock in and roll forward' approach, which has been bad for consumers. That must be reformed.
Last but not least, state governments contributed significantly to rising network costs by raising network reliability standards in the early to mid-2000s without undertaking any cost-benefit analysis of whether such increases were worthwhile. So we need reform. For the government to say it is all about the carbon tax is narrow and superficial. We need to actually look at the way the National Electricity Market operates. That is where the reforms need to take place.
There are some changes to the Australian Energy Regulator in terms of network spending proposals, but these changes do not far enough. The AER, the regulator, needs the ability to conduct detailed optimisation analyses of electricity networks' asset bases to uncover instances of excessive or premature spending. That is what we need as a matter of priority. Networks are currently rewarded handsomely for their investments, despite facing virtually no risk. It is time to make sure that they earn their pay packets. There is no other business model where you can make a lousy decision, gouge consumers and still get a guaranteed return on your investment.
I see direct relevance to reforming these rules under the National Electricity Market, the code and the Australian Energy Regulator. It must be considered at the time that carbon policy is being revisited. This is because any downward pressure on network and transmission charges passed on to consumers will ultimately give greater flexibility to offsetting the direct or indirect costs of emissions reduction policies.
I have been disappointed by the polarised, narrow nature of the debate on carbon policy over the past few years. We now have an opportunity to consider carbon policy in a broader context that has the potential to deliver a robust environmental outcome at a responsible economic cost. I challenge all sides of politics to take this opportunity to engage in a mature debate about energy and environment policies that will deliver meaningful environmental outcomes and more sustainable energy prices rather than continuing to use energy policy as a political football.
Finally, I want to make a point that I think is sometimes left out of this debate, and that relates to public health. Even if people do not believe in climate change—and I am not one of them—they cannot deny the benefits of cleaner air in Australia. The OECD Environmental Outlook found that most ambient pollution in Australia comes from motor vehicle emissions, electricity generation from fossil fuels, heavy industry and home heating using wood and coal. Further, the former government's State of the environment report in 2011 found that there are approximately 3,000 deaths in Australia each year due to urban air pollution. That is more than the annual road toll. These are the sorts of issues we need to consider in the context of this. Here is an opportunity to do something good for the environment and good for our public health, but we also need to have a responsible economic framework. We need to reform the electricity market rules in this country in addition to having a better carbon policy.
I too rise to speak on the legislation before us, the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and related bills. It gives me an opportunity to provide further scrutiny to the carbon price repeal bills introduced by the government. One of the opportunities, of course, is to dissect the government's view about clean energy. The government does not enjoy this process. It would, I suspect, prefer that the process be shunted through as quickly as possible. The Prime Minister wanted, I suspect, to jam the bills through this parliament without a moment to spare. The Prime Minister would have liked these bills to pass in bulk, rushed through without any scrutiny or debate, just as the government wants to shut down transparency and accountability on border security, to hide its plans of backflipping on Gonski and to hide its plans to pull the rug out from under Australian jobs. This is a government that is wedded to ensuring there is no scrutiny, so it wanted to ensure that these bills also passed without such scrutiny. We on this side are here to ensure that they do have scrutiny and that the government's actions are laid transparently out for the public to see.
I am pleased that the Senate has been able to provide some much-needed scrutiny of this government. We are holding this government to account for their actions. One of the things we cannot do, of course, is to hold them to account for their Direct Action Plan, because, as we know, either they are deciding to keep it secret or they do not have one and are scrambling to make one up. More and more, the Australian people are finding out that this is not the government they voted for or the government they were promised. Can I also just place something on the record to establish the type of work that they are doing—the type of obstruction we are seeing every single day in this parliament. The government are ensuring both secrecy and a lack of accountability for their actions.
In examining the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 in detail, I note that this is a Prime Minister who is obsessed with slogans. I can honestly say I have never met someone who has had to repeat himself so often to get his message through. I suspect he must be trying to convince himself for one of two reasons: either he is uncertain or he believes he is not quite convincing the Australian people as yet. I think it might be the latter. The Prime Minister's cheap throwaway slogans, such as 'scrap the carbon tax', are the type of language the Prime Minister repeats over and over again until it becomes not only boring but, I suspect, a little tedious.
So let us examine the bill in detail. It is about removing the cap on pollution. So it is about letting big polluters run amok. And later—we do not know when—it will introduce a series of cash handouts through a government 'pick the winner' scheme. They may not tell you that, but that will be the final result. It also removes market incentives to limit pollution into our environment, acting contrary to what the once principled Liberal Party would have stood for. It seems odd, doesn't it, that you on the other side are going to remove market mechanisms? Both this side and the government believe in market based incentives, but in this instance your bill is going to remove them. That is quite an odd position for the Liberal Party to be in.
It also creates a massive policy void. One of the strong arguments originally put forward by the now government against the emissions trading scheme was business uncertainty. In this instance, the emissions trading scheme does give certainty. As for the direct action policy, which the government are going to put in in place of the emissions trading scheme, only the fairies at the bottom of the garden know what it actually means. Of itself it will create and drive market uncertainty. It will cast a shadow over Australian businesses until they are provided with the detail as to how the scheme will operate, who will benefit and what the costs to the scheme will be. All of that we will find out about sometime off into the future.
The position on climate change and increased climate volatility is clear. There is a need for action today—not tomorrow, not in the next week, not in the next year. The science is in: climate change is real and man-made, and no amount of posturing or yelling by the National Party rump—as I used to say, the old doormats—can change that fact. Even the Prime Minister, who once called climate change 'complete crap', has accepted as much—notwithstanding the launch of his misguided direct action scheme. Those on the other side now say comprehensively that they do believe in climate change and they want to address it through the direct action scheme. So you must then ask this question: if the Prime Minister believes climate change is real and man-made, then why not have the most efficient and effective scheme to address climate change? We currently have a fixed price carbon period which leads into an emissions trading scheme. In short, it would be far more efficient and far more certain for business to continue an emissions trading scheme than to remove it for an unknown period of uncertainty while the government forms a view as to what direct action would look like. Of course, the current scheme would tackle climate change today, not tomorrow. I suspect that direct action is simply a slogan the government is using to undermine the emissions trading scheme.
When I say the carbon pricing scheme has worked, I am backed up by the facts—something I know this government does not like to deal with. Under Labor, employment in the renewable energy industry more than doubled. We added more than 150,000 jobs to the national economy after the carbon price came in. What is more, the sky did not fall in. Pollution in the National Electricity Market decreased by seven per cent. We showed that you can have a cleaner, smarter economy and jobs growth. Pollution went down; jobs went up. I have to add, having seen this government's record to date, that under Mr Tony Abbott the exact opposite will happen.
I would like to quote from a meat processor, AJ Bush and Sons from Beaudesert in Queensland. Mr Bush said on 20 March 2013, referring to the carbon price: 'I think it's a net positive. I think it will serve to make our businesses stronger.' He was quoted as saying the price would help his company become 'clean and mean', cutting costs and allowing them to grow even further against tough competition overseas. Quite frankly, it is hardly a doom and gloom story. Many of these stories have been reiterated in the press over the last 12 months. Businesses have embraced the opportunities that cutting pollution brings about. It brings about changes in technology and improved efficiencies within organisations.
All of that is now at risk with this government's design not only to remove the carbon price and the emissions trading scheme through this legislation but also to have us all on a tether as to what their Direct Action scheme will be like. Last year the OECD released a report confirming that countries could achieve higher levels of emissions reductions at much lower cost if they relied on this type of scheme. Emissions trading schemes have already been adopted in many countries around the world, including the United Kingdom, France, Germany, South Korea, Canada and parts of the US and China. I think the world will view us as backtracking on climate policy, being regressive in the extreme and not wanting to maintain a vigilant look on this policy.
We know that those opposite do not accept the science of climate change, notwithstanding what they say. I think that is one of the reasons why the Prime Minister repeats himself often, because ultimately he is trying to convince himself that climate change is real. I do not think he has changed. I think the Prime Minister has not changed his spots. He continues to be a doubter in this area.
Looking more broadly at the policy itself, you would have to come to the conclusion that Direct Action is an area where this government should in this debate make plain what it will be. The coalition's approach to carbon pollution is focused on the creation of a $2.9 billion fund, an Emissions Reduction Fund. The fund will pay Australian companies to reduce pollution. The business uncertainty is already starting to be heard: 'What does that mean? Who will get the money? How will it be paid? How will people measure the pollution?' I suspect we will have an array of red tape around the ERF, the Emissions Reduction Fund. Whilst on the one hand this government is heading down the path of suggesting to the world and to Australia that it is going to have a huge red tape reduction day, on the other hand it is already developing its own swathe of red tape with the future Emissions Reduction Fund and the Direct Action policy. Whereas Labor is focused on capping the amount of pollution that can enter the atmosphere and having a system for businesses to find the cheapest way to reduce their pollution, the coalition will resort to the favoured old mechanism of using the taxpayers' money to fund their Emissions Reduction Fund or, as I prefer to call it, big business slush fund.
Independent research and modelling undertaken by SKM and Monash University's Centre of Policy Studies shows that the ERF will see pollution increase by eight to 10 per cent over 2000 levels by 2020. It will not work. That is the final submission about their emissions reduction fund. It will bog down in detail. Businesses will find it impossible to meet it. They will simply take the money and attempt to reduce their pollution. It will require additional investment to achieve 2020 targets, and that will not be met out of the taxpayers' fund.
We will fall short, whereas, if we allowed a market based mechanism to work, it is possible to achieve it at a lot less cost. What we will end up doing is subsidising with public moneys the pollution of businesses that do not make the changes, and that could amount to, as Monash University's Centre of Policy Studies estimated, about $50 billion to 2020. Despite the posturing by the coalition over the last couple of years, they still do not have a credible alternative policy to the one they are currently trying to get rid of. Labor's approach has provided unprecedented support for renewable energy through the Renewable Energy Target, the Clean Energy Finance Corporation and the Australian Renewable Energy Agency. Support for businesses to become more efficient and productive came from the Clean Technology program and jobs in competitive programs, and there was support to reduce land sector emissions through the Carbon Farming Initiative.
One of the ironies in this is that, as you travel around the bush, you find that farmers do want to embrace the ability to reduce their pollution. They do see the benefits in reducing their emissions and being part of the Carbon Farming Initiative, while this government is hell-bent on removing it. In the various farming communities that I have talked to over the years they understand the need to maintain a good environment. They are good land managers, they do provide good results and they do want to participate in things like the Carbon Farming Initiative. They understand the need to reduce their emissions, whereas this government is going to remove that. I think it is a sad day for the bush to find that the government is not only removing the emissions trading scheme but also ensuring that the Carbon Farming Initiative will no longer be available for rural areas. More importantly, that overall drive to reduce emissions will peter out under this government.
The purpose and structure of these three bills repeal the Clean Energy Act and associated legislation. The main repeal bill, the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013, repeals or amends acts that legislate a price on carbon to remove that function, removes the power of the Australian Competition and Consumer Commission—the ACCC—to monitor the exploitation in relation to the carbon price and removes a 15 per cent tax offset for conservation tillage.
Again I want to concentrate on the last two in the time available. First, farmers have been able to use the 15 per cent tax offset to improve their outcomes. This is being removed. I am not sure Mr Joyce has been out there telling farmers that the 15 per cent is also being removed as part of the carbon price repeal. The second area, of course, is how they will utilise the ACCC to monitor for price exploitation. I suspect the truth is that the government does not care one jot about the result other than to remove the carbon price and these pieces of legislation from the statute books.
The government has taken a view—be it political or otherwise—that this scheme should end. The difficulties will be passed through price and monitoring powers of the ACCC. I think the government needs to clarify how it will ensure that there will not be price exploitation during this process. I think it will create business uncertainty. Businesses will be subject to costs and imposts whilst the ACCC continues to do its work—and without any clear benefit. And, under the CFI, farmers and landholders could voluntarily undertake projects to reduce or store greenhouse gas emissions. All of this will be lost under this legislation, should it pass. What that means is that many landholders who have embraced the 21-odd methodologies—in the categories of agriculture, vegetation and landfill, and alternative waste treatment—will be stuck. The government has no plans in place to follow through with what happens next. The government is solely centred on this one point, without any plans as to how it will manage to meet our 2020 target for emissions reduction. Shame on this government!
Let me reiterate from the start that, once an appropriate alternative is presented, Labor will support the repeal of the carbon tax. The former Prime Minister Kevin Rudd stated this clearly ahead of the last election. The Australian Labor Party has long argued for a fully flexible cap-and-trade emissions scheme such as the mechanism currently contained in the Clean Energy Act 2011 and associated legislation. We will continue to support the market based mechanism for pricing carbon that is contained in the existing legislation and scheduled to begin next year. We would also support bringing the starting date forward so an emissions trading scheme can commence this year. There may even be opportunities to improve the current model. But, as long as an effective market model for pricing carbon emissions remains in place, Labor is willing to work through the amendments that may be required with the Abbott government.
What we do not support is a shift away from taking action against pollution—doing nothing in the face of overwhelming evidence. What we do not support is a shift from evidence based policy to ideology and ignorance. Unfortunately, that is what the Abbott government has offered to the Australian people. Let us touch on what the coalition's approach has been. The Abbott government does not have an effective plan to replace an emissions trading scheme in the short term. And, beyond that, its policy of direct action contains serious and fundamental flaws. It is a policy that cannot even guarantee emissions trading reductions will ever be met.
The Emissions Reduction Fund, which the coalition describes as the centrepiece of its direct action policy, is still in development. Important questions in the government's green paper remain unanswered and the policy lacks both substance and detail. There current proposal amounts to nothing more than a slush fund for major polluters. It is an unnecessary gamble based on picking winners instead of guaranteeing our bipartisan emissions trading reduction target of five per cent below 2000 levels by the year 2020. It is an unnecessary gamble on our environment and on our future. A scheme that does not legislate to cap emissions really means the potential for future carbon pollution under their proposal is unlimited.
Despite these shortcomings, a budget has already been allocated. It is no wonder one coalition MP has linked Direct Action to 'a school project' and former Treasury secretary Ken Henry describes it as nothing less than 'bizarre'. It uses a command and control model that would involve ministers and public servants making these important choices, with significant bureaucratic overheads to evaluate and analyse bids for funding. It will cost the Australian taxpayer much more than if we allowed these decisions to be made by businesses themselves.
The science on climate change is clear. Over 97 per cent of published climate scientists agree that climate change is a real phenomenon driven by man-made greenhouse gas emissions. In a Fairfax survey of 35 economists, 86 per cent supported an emissions trading scheme, with only two favouring Direct Action. Rob Henderson, a senior economist at the National Australia Bank, has said:
If I had to make a choice between pricing carbon and having bureaucrats allocating permits, then I'm going to go for the market mechanism every time.
Treasury's blue book, prepared in the lead-up to the 2010 federal election, observed:
… a market-based mechanism can achieve the necessary abatement at a cost per tonne of emissions, far lower than other alternative direct action policies.
Even the darling of British Conservative ideology, the then Prime Minister Margaret Thatcher—and I cannot believe I will be quoting her today—told the United Nations in 1989 that action on climate change should be based on assessment of fact:
We must use science to cast a light ahead, so that we can move step by step in the right direction … But as well as the science, we need to get the economics right … On the basis then of sound science and sound economics, we need to build a strong framework for international action.
It will be the height of arrogance for a government that thinks it knows better than 97 per cent of scientists and 86 per cent of economists to go down this path, a path that not even Margaret Thatcher would approve of.
I suspect that Malcolm Turnbull, the honourable member for Wentworth, does not approve either. Let us not forget that in 2012 he said:
You won't find an economist anywhere that will tell you anything other than that the most efficient and effective way to cut emissions is by putting a price on carbon.
Action through a market based mechanism to reduce carbon emissions is supported overwhelmingly by scientists and by economists. I believe that the government can do better, as I am sure the member for Wentworth does. I would welcome a chance to work with coalition MPs on a proper emissions trading scheme that can be accorded bipartisan support in this chamber. Australia should not repeal a system that is reducing emissions and reversing the disastrous impact of climate change without having a strong alternative in place, and we should not be considering the coalition's ineffective alternative as being substantial enough.
As I have previously discussed, the Howard government was responsible for commissioning the Shergold report, chaired by former Secretary of the Department of the Prime Minister and Cabinet Peter Shergold. The report recommended the establishment of an emissions trading scheme, a policy that John Howard supported during the 2007 election campaign. Releasing the report, Dr Shergold said:
Australia should commit to an emissions target … ahead of any comprehensive global response, and it should do that with an emissions trading scheme based upon cap and trade.
An emissions trading scheme provides incentives for business to innovate as the market will determine how they address the costs of lowering carbon emissions as opposed to a command-and-control model. The only way we are going to reduce carbon emissions is if all polluters change their behaviour. Picking the winners to receive government subsidies is obviously only incentive to the lucky company involved and only reduces emissions to the extent that the subsidised project allows. It will not change behaviour across the entire economy.
The Shergold report also concluded that not choosing an emissions trading scheme would impose a far heavier burden on economic activity and, as a result, picking winners 'will increase the costs we impose on ourselves'. It then goes on to describe the potential cost of measures such as direct action as 'nothing less than enormous'. John Howard's initial response to the Shergold report led to carbon pricing being a bipartisan issue in the lead-up to the 2007 election. Both Labor and the coalition were committed to act through an emissions trading scheme. Unfortunately, in recent years that spirit of bipartisanship has been lost for reasons that are nothing more than politically opportunistic rather than in the national interest. The coalition's current approach involves higher costs for outcomes that are much worse, and the absence of an alternative policy which has been barely drafted creates an environment of uncertainty as to what any emissions framework might look like decades from now.
To outline the basis of this debate we must look at what the Clean Energy (Carbon Tax Repeal) Bill 2013 will achieve. It will abolish the current legislative framework for an emissions trading scheme, but it will not replace this system with an alternative method of addressing climate change. When factoring in the bipartisan commitment to ending the carbon tax, the most important mechanism contained in the Clean Energy Act 2011 is the cap-and-trade emissions trading scheme. Labor supports bringing this market mechanism forward to commence this year. Friends, let's put a cap on emissions and let the market determine what the price on pollution should be. Capping carbon pollution is essential to this model. This is the way in which the current legislation can guarantee we achieve our emissions reduction targets.
Pollution caps are determined on the basis of advice given by the Climate Change Authority, an independent expert agency that this government has attempted to abolish in other legislation. If the government does not have objective, factual, accurate, rigorous information available when making a decision, what are they going to be basing their decisions on? As I have said previously in this chamber, ignoring the evidence on climate change and abolishing independent advice to government is an attack on good science, on good public policy and on the truth. Pretending this expert evidence does not exist and preventing future scientific inquiry is grossly negligent.
We in the Australian Labor Party cannot allow ideology to undermine the evidence on climate science. The Clean Energy Act 2011 provides for Australia's carbon pricing scheme to coexist with credible international initiatives to reduce carbon pollution. The Australian Labor Party also recognises the bold progress that many other countries are making to address climate change. Thirty-five countries currently have a national emissions trading scheme, and it is expected that by 2015 this number will rise to 38. Almost a billion people currently live in a jurisdiction with an emissions trading scheme. By 2015 this number could rise to two billion people as China, Korea and other countries are planning to introduce their own models. Australia remains the largest per capita polluter in the developed world and one of the world's top-20 polluters in absolute terms. We have a significant opportunity to be a global leader on emissions reduction efforts.
Instead the Abbott government has taken a great leap backwards. Under Direct Action the coalition's policy successes will be dependent on three things: firstly, the quality of emissions reductions proposals offered by polluters; secondly, how much they will cost; and, thirdly, how much cash the government is prepared to stump up. The outcomes are variable, there is no guarantee the proposals will be good enough or cheap enough to meet our emissions reduction targets, and there is huge potential for the budget to blow out. The current legislation, on the other hand, gives certainty of outcomes, encourages innovation in the market to achieve emissions reductions rather than bidding for a pool of government funding, and is more measurable in terms of costs and benefits.
This brings me to the next significant part of the current suite of laws, household assistance. It is undeniable that pricing carbon will result in some consumer prices increasing. That is why an essential part of the carbon pricing legislation was to fund tax cuts, pension increases and higher family payments. The coalition promised to keep these, regardless of repealing carbon pricing. But, with the secret Commission of Audit report expected to recommend expenditure cuts, the government is not ruling anything in or out.
For industry the Clean Energy Future package recognised that moving to a low-emissions economy will take time. Emphasis was placed on ensuring energy security while working towards a transition in the energy market away from emissions-intensive forms of electricity generation. By retiring high-polluting generating capacity and fostering investment in new sources of energy and infrastructure, the package was designed to permanently reduce the environmental impact while maintaining a reliable energy base. The jobs and competitiveness program provided additional support, and the independent Productivity Commission was given the ability to review the impacts of carbon pricing policy. There was also a tremendous opportunity to invest in low-emission and clean-energy technologies. These helped prepare Australia for future jobs and future opportunities in emerging industries.
Abolishing the Clean Energy Finance Corporation has removed one of the very effective means of mobilising significant private sector capital. It will damage government revenue and cut jobs in the low-emission sectors. John Howard was right when he said in 2007 that 'being amongst the first movers on carbon trading in this region will bring new opportunities and we intend to grasp them'. Those opportunities still exist and Australia cannot afford to miss out.
The bills before the Senate will destroy the entire framework for delivering a cap and trade mechanism and, with it, any incentive to meaningfully reduce carbon emissions in Australia. It is one thing to support improving and refining the current approach—there have been a lot of criticisms of the fixed price component on this side of the chamber as well; and that is why we want to abolish the carbon tax, as it currently stands, and move to a market mechanism sooner—but we do not want to stick our heads in the sand, deny climate change exists and remove any way or mechanism for research and independent advice that might dare to tell us otherwise. That is the effect of this trove of bills and that is why these bills should not be supported by the Australian Senate. The bills will limit Australia's ability to respond to climate change for years to come.
I call on the government to show leadership in this area and work across the chamber on a bipartisan approach to climate change that stands up on the basis of both scientific and economic evidence rather than, in the words of Malcolm Turnbull, producing something that is 'a con, an environmental fig leaf to cover a determination to do nothing'.
In introducing the clean energy future package into the parliament in 2011, the then Prime Minister, Julia Gillard, noted:
Nothing hard ever gets easier by putting it off.
And if you do not do what is right for the nation then you should not be in this parliament.
I know that from time to time politics is one thing and good public policy is another, and sometimes there is a great temptation to capitalise on that. But this issue is far too important. It should not fall victim to opportunistic partisan politics. I believe that acting on the evidence of climate science and following the economic advice which points to an emissions trading scheme is the best way to respond to the real and current phenomenon of climate change. I would not judge the coalition if they were willing to work with me and my colleagues on this basis. In fact, I would be the first to welcome it as a sign that they do, after all, support policy based on fact and evidence. To me, this is the right policy for the nation—an approach based on evidence rather than on cheap politics or crude ideology. I am proud to stand here today advocating that as the way forward.
How we vote on the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 will be remembered in decades to come. Prime Minister Julia Gillard also made this observation about votes in this place when first introducing the carbon pricing legislation:
There is a reason these matters are decided in an open vote.
It is so every member in this place can be judged.
Judged on the decisions they make here … judged on where they stand on the great issues of our national debate.
… … …
Because the final test is not: are you on the right side of the politics of the week or the polls of the year?
The final test—
on this issue and other issues—
is: are you on the right side of history?
Transitioning Australia's economy from one that is carbon intensive to one built around clean energy and the technologies and industries that stem from it is one of the important issues that we face today. Those opposite have dragged the debate and this issue down to a trivial level. Their ignorance and political expediency are rewarded at the expense of national interest. Those opposite claim a commitment to emissions reduction and creating a cleaner economy. Their policies to this end reveal a complete lack of regard for the future of this nation, which hinges so heavily on successfully transitioning Australia from its current status as the highest per capita polluter in the world to one of the lowest.
The environmental effects of climate change, the economic effects of climate change and the social effects of climate change are the issues I would like to speak about today. Direct action is the sort of policy that a government implements when it does not believe in having a policy at all. It has been said that it is a fig leaf being used to cover its philosophical rejection of climate change and is a shameful expedient on this issue. It is the sort of policy motivated by scepticism of climate science—motivated by sentiments such as those possessed by Mr John Howard, who described those who believe in climate change as a bunch of 'religious zealots'. He said that he believed in his instincts rather than the more accurate and immense body of work that has been done by our scientists. Sad though it is, even I had to laugh when I heard coalition members talking about how such climate scientists were 'junior', as though the body of evidence relating to climate change meant nothing. A recent study of peer reviewed papers has found that only one out of 9,136 of these reject global warming. When you cannot play the ball, you play the man.
Indeed, how the coalition can argue with a straight face that their direct action policy will deliver the same level of emissions reduction promised by Labor at a lower cost to the economy is beyond me and, I think, beyond most people and other senators in this chamber. What has come home to roost is that the slogans used during the election campaign are bereft of any policy substance. We have even had an announcement of an army—which I can only presume will be led by the coalition's own Sergeant Schultz, 'I know nothing' Hunt. The coalition wish to implement this scheme while at the same time slashing the level of advice they are able to receive about the issue by abolishing both the Climate Change Authority and the Clean Energy Finance Corporation. How can the coalition credibly argue that they will be able to pick and choose winners and effectively fund clean energy and carbon abatement schemes when they are planning to abolish the institutions which could possibly provide advice about both which schemes to fund and how to fund them?
Let us be clear about the coalition's policies. They are more extreme on an economic level than those of postwar Europe and even the heady days of the eighties. At best the policy will have no positive effect. Direct action is a policy that will waste money. It is a policy that is vulnerable to rorting and the creation of vast trails of money that lead nowhere. Indeed, it is ironic that the coalition, who pontificate in this house about the virtues of fiscal prudence and frugality, are set to create a scheme which almost appears designed to waste taxpayers' money. They have promised to set aside vast sums of money to set up what they call an Emissions Reduction Fund, which, in their own words, will 'allocate money in response to emission reduction tenders to projects designed to reduce carbon emissions'. I am not sure what process will be used to evaluate these tenders. What expertise will the government call upon to rigorously evaluate the validity and veracity of these tenders? I presume the minister will not be personally sifting through a stack of funding requests one by one.
This government inherited a wealth of expertise that was built around the Climate Change Authority and the Clean Energy Finance Corporation, organisations the government had at its disposal to provide frank, realistic and evidence based advice in relation to climate change and the types of investment that can be made to aid its abatement and transition our economy. The implementation of their advice regarding investment in carbon abatement and clean energy research in industry was enabled through funds raised from carbon pricing. Both of these organisations have been dynamited. We have a government that has jettisoned all useful advice and all real funding for clean energy investment yet still purports to want to make these investments. This time around, the taxpayer is going to directly foot the bill for the coalition's direct action policy, which is going to be implemented on a wing and a prayer, without adequate advice or resources to efficiently administer such a policy.
However, perhaps the greatest indictment of the coalition's proposed substitute for a comprehensive carbon pricing scheme is that it will fail to deliver on the environmental outcomes it promises to. We are the highest per-capita emitter in the world. We have experienced our own fair share of extreme weather events in recent times, a tangible testament to the increasing evidence of climate change. From an environmental perspective, we stand to lose much from the adverse effects of climate change. It is for these reasons that it is incumbent on us both to act on climate change and to be global leaders.
In my home state of Victoria, bushfires have been more and more severe and have been made so by unprecedented heatwaves. In other states we have endured storms and floods caused by cyclonic activity that has been unprecedented in its frequency. We have seen firsthand both human and economic devastation caused by extreme weather events. We know that these events are becoming more and more frequent, to the extent that they have almost become normalised. Yet it is important that we remember that these types of climatic patterns are not the norm. They are historically anomalous, and the evidence points to a greater trend in the earth's climate. Frighteningly, we are gathering pace towards a critical mass where abatement attempts will become futile. In other words, the damage will already have been done and will be permanent. The damage has the potential to vastly reduce our ability to export food to the world, crippling our agricultural sector, and could even possibly jeopardise our own food security. Rising sea levels will affect salinity levels in our soil, reducing its fertility, while other changes in weather patterns have the potential to stunt crops through drought and severely raise the cost of raising livestock.
These are but a few of the key reasons why the coalition's position on this issue is so damning. Time is quite literally of the essence when it comes to mitigating the effects of climate change, yet the urgency of mitigating climate change is not realised purely from the extreme weather events. We see climate change all too often in the effect it is having on the natural wonders that we have so enjoyed and, hopefully, will continue to enjoy.
The Great Barrier Reef outlook report conducted in 2009 found that climate change will increase ocean acidity levels, increase the sea's temperature and cause a rise in sea levels. Each of these effects has the potential to irreparably damage the Great Barrier Reef by disrupting its delicately balanced ecosystem. Changes in sea levels will affect the balance between salt and fresh water in our estuaries. This will unavoidably impact on our native flora and fauna. Considering all of this, how is it the government can sit idly by while our own natural wonders are trashed by the effects of climate change?
Those in this place who do not believe that we are doing damage to our planet might be long gone when the generations that follow look back and ask why we did nothing. To those opposite: what would you say to them when this question is asked of you? I would suggest that your Direct Action policy will not be anywhere near enough to satisfy such a question. Obviously, we can sit here and list the terrible environmental consequences of climate change not only for Australia but also for the rest of the world. It is also vital that we consider the economic implications of climate change and the economic opportunities heralded by a restructuring of our economy to one centred on a clean economy necessary to abate climate change.
Under this government Australia is to be left behind the rest of the world when it comes to reducing emissions and restructuring our economy. The effects of climate change are real and caused by humans. The end consequences of the climate's current trajectory are inevitable. What does this tell us? It tells us that, whether we like it or not, sooner or later we as a nation will be forced to confront climate change and the emissions intensity of our economy just as every other nation around the globe will inevitably have to do. This should serve as a warning and an opportunity for this country. Either we can act now and position ourselves to take advantage of the economic change which will ultimately occur globally or we can wait behind and have this change foisted on us with dreadful economic consequences.
It is not in our national interest to shrink away from this challenge. Others around the world are moving on this issue. China, as we are aware, is a rising global power whose industrialisation is gathering pace year after year. China, though a heavy polluter, is also a heavy investor in clean energy research. It has invested $60 billion in the last financial year alone. China has also implemented emissions trading schemes in several of its provinces whose combined populations equate to 10 times our own. The Chinese have immediate environmental concerns with the negative effects of heavy pollution on population health abundantly clear to all of us.
But China would also see the restructuring of the global economy to one founded on clean energy and low emissions as a massive opportunity for their already resurgent economy. The Chinese seem to understand that there is money to be made and jobs to be created from clean energy research and the industries that stem from it. It is this opportunity that the coalition government ignorantly and stubbornly refuse to acknowledge, and they fail to act time and time again.
Other nations are also acting on climate change or at the very least beginning to act. The European Union has established an emissions trading scheme. Though those opposite like to criticise the scheme, the fact remains that the EU has already laid a key foundation stone upon which a clean energy economy can be built into the future. South Korea and New Zealand have established emissions trading schemes, as have several states within the US whose populations far outstrip our own. Add to this that the US and the EU are the second- and third-highest investors in clean energy research and technology around the world.
It is those nations that are investing that, when the crunch comes to act universally and address the drastic effects of climate change, will be at the forefront, and it is those nations that will benefit. Conversely, it will be nations such as ours, which at critical moments have been led by timid and intellectually bereft governments such as the one we currently have in this country, that in economic terms will be severely affected by the changes that will inevitably occur on a global scale. It is much better to shape our own economic destiny as much as we can than to have it foisted upon us when we are in a state of unpreparedness.
In a time when we are seeing more and more of our traditional industrial bases disappear, it is clear that it makes economic sense to foster a new wave of Australian entrepreneurialism revolving around clean energy research and industry. This is where the jobs of the future are likely to be found. It is important to remember that this is where the benefits of acting now on climate change can clearly be seen. These job opportunities most likely will not be there in five let alone 10 or 20 years time.
Finally, I would like to discuss the social impact of climate change as a way of explaining why genuine and substantive action is required now to abate its effects. Climate change is a phenomenon that will affect those most vulnerable the hardest. Any price impacts resulting from food scarcity caused by climate change will be felt the most by those who can least afford it.
Added to this are the various public health implications of climate change. Changes to our climate have the potential to increase the rates of infectious diseases, waterborne diseases, food borne diseases, vector borne diseases and respiratory illnesses. Such public health problems will inevitably affect the most vulnerable in our community. This is without mentioning the added cost that will be faced by our health system as it is forced to deal with increasing rates of these types of infections, often in remote parts of Australia. It is on this basis that climate change and its abatement are inextricably a moral issue, and not just within an Australian context.
Internationally it is worth looking at countries such as Bangladesh, which has a population of over 150 million, over 30 million of whom live below the nation's poverty line. Bangladesh is also a low-lying country. As we know, climate change will have the effect of raising the earth's sea levels. When many people think about rising sea levels they think about land becoming submerged. This is obviously a consequence of this phenomenon. In Bangladesh's case, however, rising sea levels will have the effect of raising the water table, which for low-lying countries such as theirs could be potentially catastrophic. Alteration to the water table could render vast tracts of arable land in Bangladesh infertile by raising salinity levels. For a country where starvation is tragically prolific, such a turn of events would be utterly devastating. We can only imagine the millions more in Bangladesh who would be pushed below the poverty line because of climate change's adverse effects.
We might say that Australia is small and that any of our efforts to abate climate change will be futile. To this I would say that, for every country such as ours that finally acts on climate change, it potentially makes the next country a bit more willing to do the same. This is without acknowledging the massive economic opportunities available to us if we act now.
To conclude, it is with sadness that this parliament has had to witness the government's legacy of climate change denial printed in the words of these repeal bills currently before the Senate. Spelt out in these pages is the way in which the Australian government is going to deny Australians an economic opportunity while at the same time leaving us completely vulnerable to the economic upheaval climate change will herald. These bills are the permanent testament to how this government has failed to address the pressing environmental impact climate change is having on our own land right here in Australia. They are also testament to the social problems that this government will permit in the future. We had in place a blueprint to transition this economy, preserve our environmental heritage and shield our most vulnerable from disaster. It has been ripped out, and in its place is a policy that is not worth the paper it is printed on.
I commend that excellent contribution from Senator Tillem on these bills. I have been listening to this debate quite closely. It has been going on for some time. I think that reflects the concern that all senators in the chamber have around this particular issue. I welcome the opportunity to contribute to this debate.
It is interesting to hear some of the arguments put by different senators. One of the first arguments I heard, which is quite common across the government, is that some countries—China is often mentioned—are increasing their emissions and that any action that we take will be futile and insignificant, and therefore we should not take it. It is true that China has a rapidly growing economy. Over the last two decades it has started to industrialise. The Chinese have started to grow their economy. They are pulling their people out of poverty. As the standard of living in China is increasing, people want more goods that consume electricity. That is something we are not in a position to deny them, given that over the last 100 years Australia has gone through that industrialisation process and freely polluted the world. Part of that pollution was the industrialisation process which has taken us to the standard of living which we now enjoy, and we should not be taking the attitude that we should deprive other people of it.
China are increasing their energy needs, but they want to do so in the most efficient manner. I know that China are taking a lot of action on climate change and reducing their emissions, even though their electricity generation is increasing at this point in time. Coal fired power stations are being built through more efficient means than was previously the case. They are also investing significantly in solar, wind and other renewable energies. They will get to the point where electricity demand peaks and they start to decrease it using technology and becoming part of the world system of cap and trade which will be inevitable because we must act on climate change.
I think the argument that while some countries are increasing their emissions we should do nothing simply does not bear scrutiny. It is not a position that I am prepared to support. I think a country that is rich, has gone through industrialisation, has a high standard of living and can in the time frame take the actions we should be taking for our children has an obligation as a country. By no means are we are leading the way. In fact, most other countries—certainly all developed countries—are taking at least as much action on climate change as us and, in most cases, more.
There is also the argument that, given we are a relatively small country in the scheme of things, any action we take will have no significant impact on the overall world climate change process. Again, I think that is an argument which should be just totally rejected.
It is arithmetic, really. If every country does what it needs to do regardless of its size—and the smaller the country, the less impact it will have—if every country does the right thing, then it will add up. That is what arithmetic does. Every bit helps, whether it is a small bit or whether it is a large bit. To suggest that just because our contribution will be relatively small on the worldwide scale as an excuse not to do anything, again, is just a ridiculous argument. If we took that position, we would do nothing internationally. We should be in a position where we can be leaders. I wish we were leaders, but we are not actually leaders. We should be leaders and we should be up there leading with the rest of the developed world in the overall approach. I do not think we are..
One of the other arguments that is being put forward is this mandate argument. It is true; I heard Tony Abbott a number of times in the election say, 'This election is a referendum on climate change.' If that were true, then they do not have a mandate for any other issue. You cannot have a referendum and run multiple referendums, so their argument then about having a mandate for the mining tax and having a mandate for everything else they claim to have a mandate for simply cannot be true if the last election was a referendum on climate change.
But, of course, the facts speak for themselves: it was a general election; it was not a referendum. So it was not a referendum and it was not a referendum on climate change. I was elected at the last election. I had a very clear position that I wanted do something on climate change. I wanted an emissions trading scheme that is effective. I absolutely supported the removal of the carbon tax and moving to an emissions trading scheme to ensure that there was a price on carbon. That is what I am happy to support. But I am not happy to support just the repeal of all these bills and to have this nonsense of direct action, where you simply pay big polluters to try to pollute less as a way forward. It is just something that I cannot accept.
So I have a mandate to take the position I take. Government senators believe that they have a mandate to take the position they take. The numbers will fall as they will; the Senate will decide. We all have mandates here and we are all elected here. If the government gathers enough numbers in this place to pass these bills, then that will happen. If not, it will not happen. We all have our individual mandates. We were all elected into this place by the people. So I reject that argument too.
One of other areas I have found a little bit concerning, again, is the Greens' attitude and their outrage about these bills being put forward. I say that the Greens political party is as responsible as the government for these bills that are before us right now. They are as responsible as the government is. In 2009, they stood shoulder to shoulder with the climate change sceptics—who are on the other side of the chamber now—and voted down the ETS as proposed by the government. They voted it down. They stood shoulder to shoulder with the climate change sceptics and voted down the ETS.
They did so through rank political opportunism, because they wanted to have their name and their brand on the bill. They wanted to shape that bill the way they wanted and it was either their way or the highway. Therefore, they voted against those bills. If they had voted for those bills at the time, the ETS would have been in place in 2009 and it would have been in operation for four or five years. It would have then demonstrated to the Australian people that the ETS was actually working. We would have seen the demonstrable outcomes of reducing emissions. The markets would by then have well and truly accepted it; it would have been operating and it would have been a normal element of doing business.
It would have then shown the way—that this is the best way to deal with climate change—through a market-based mechanism. But they opposed it, standing shoulder to shoulder with the climate change sceptics at the time. As I said, it also then allowed those people on the other side to run a scare campaign for two to three years against taking action on climate change. That would not have been able to happen either. So when they come into this place and propose their outrage at these bills I say to them that they ought have a good look at themselves and their actions in 2009, which I absolutely believe have led us to this point here today.
These bills seek to dismantle Australia's response to the challenge of climate change. Australia has committed to reduce emissions by at least five per cent by 2020, compared to 2000 levels. This is part of the international coordinated effort to limit human impact on our climate. The first action of the Labor government back in 2007 was to ratify the Kyoto protocol, after years of opposition by the Howard government. This action showed that as a nation we were ready to stand up and help the world deal with the dangers of climate change. Australia is the largest per capita polluter in the developed world and is one of the world's top 20 polluters in absolute terms. It is critical that we work with the world community and do our part.
Ninety-nine countries worldwide, covering 80 per cent of global emissions and 90 per cent of the global economy, have made formal pledges to the United Nations to reduce carbon pollution. As part of the Kyoto protocol, the international community has committed to limiting global warming to below two degrees. Above two degrees, many regions—including Australia, which is the world's driest continent—will face potentially catastrophic shifts in climate. If emissions continue to grow at current rates warming is projected to increase rapidly over the 21st century, exceeding two degrees within the next few decades and foreseeably reaching four degrees or more by the end of the century.
The 2012 World Bank report called Turn down the heat: why a 4°C world must be avoided warns us of the dangers of inaction. A four-degree world is likely to be one in which communities, cities and countries would experience severe disruption, damage and dislocation, with many of these risks spread unequally. It is likely that the poor will suffer most, and the global community could become more fractured and unequal than it even is today.
The effects of four degrees of warming will not be evenly distributed around the world. The largest warming will occur over land and will range from four degrees to 10 degrees. Increases of six degrees or more in average monthly summer temperatures would be expected. A four-degree warming would significantly exacerbate existing water scarcity in many regions, particularly North and East Africa, the Middle East and South Asia. The regional extinction of entire coral reef ecosystems could occur well before a four degree-warming.
As global warming approaches and exceeds two degrees, the risk of crossing thresholds of non-linear tipping elements in the earth's system will see abrupt climate change impacts and unprecedented high-temperature climate regimes increase. Examples include the disintegration of the West Antarctic ice sheet, leading to more rapid sea-level rise than projected in this analysis; and large-scale Amazon dieback, drastically affecting ecosystems, rivers, agriculture, energy production and livelihoods on almost continual scale in the region and potentially adding substantially to 21st century global warming. As the World Bank has identified, if we are unable to limit global warming to two degrees, the impact on humanity will be catastrophic.
The facts are clear: the world is warming. Since 1750 and the beginning of the industrial revolution, human activities have dramatically increased the amount of carbon dioxide in the atmosphere by 40 per cent, methane by 150 per cent, and nitrous oxide by 20 per cent. Temperatures have been rising. Between 1880 and 2012, average global surface temperatures over land and the oceans have warmed by 0.85 degrees. In Australia the average temperature has increased by 0.9 degrees since 1910, and there have been significant increases in the numbers of hot days and hot nights. The 2012-13 Australian summer was the hottest since records began. One hundred and twenty-three weather records were broken over a 90-day period, including the hottest day ever recorded for Australia as a whole, the hottest January on record, the hottest summer average on record, and a record seven days in a row where the whole continent averaged above 39 degrees. And this year's summer has been another very hot summer with more records falling, including a record hot spell for Melbourne with four days over 40 degrees in a row—a spell not seen since 1908. Adelaide set a record with 13 days over 40 degrees, smashing the previous record that had stood for 117 years. Seventy per cent of Queensland is now drought-declared. Towns such as Cloncurry have now moved to level 6 water restrictions. With two failed wet seasons, much of Queensland is facing catastrophic dry conditions. The costs of dealing with climate-induced crises are massive—from significant drought relief packages to the costs of damage from cyclones and their impact on our neighbours.
It is clearly in our nation's interest that we act to reduce emissions of carbon dioxide to limit the impact of a warming climate. Yet this bill will dismantle the world's best practice now in place to reduce our emissions. Market mechanisms are the most efficient in reducing carbon emissions; polluters are forced to reduce their emissions or pay a price. It is the price on pollution that will drive the market. The proceeds of the price on carbon are then distributed to help industry adopt modern efficient processes and to help the consumer defray their costs. The OECD in its 2009 paper The economics of climate change mitigation clearly identifies putting a price on carbon as world's best practice. Putting a price on emissions through price mechanisms such as carbon taxes, emission trading schemes or a hybrid system combining features of both can go a long way towards building up a cost-effective climate policy framework.
Although taxes and ETS schemes differ in a number of respects, both are intrinsically cost effective and give emitters continuing incentives to search for cheaper abatement options through both existing and new technologies. Internationally, many nations have a price on carbon and they include some of our biggest trading partners. According to the Climate Commission, 33 countries and 18 subnational jurisdictions have carbon prices in place. Europe has had a price on carbon since 2005, Japan since 2012, New Zealand since 2008, South Africa since 2013 and South Korea will have one from 2015. China—the world's biggest polluter—has started seven pilot ETS schemes in regions covering more than 200 million people, with the aim of having a national trading scheme in place by the end of this decade. A price on carbon is a common-sense way to reduce our carbon emissions and to encourage efficient and cost-effective industry and consumer behaviour.
The introduction of a price on carbon here in Australia has been a success. Since the introduction of the carbon price, emissions in the electricity sector—the biggest component of carbon emissions—have fallen 14 per cent over the last two spring seasons. In total, spring emissions are down almost 20 per cent since the peak just five years ago in the spring of 2008. In 2012-13, renewables increased their share of the national electricity market by 25 per cent—that is, in just one year. More than one million households have been fitted with solar panels, and over 2,400 megawatts of power are now produced by solar panels—a leap from the 100 megawatts produced in 2008. Employment in the renewable energy industry more than doubled to over 24,000 people, and wind power has trebled, now producing over 3,000 megawatts.
As an example of the success of our policies, in April last year the energy company AGL opened its Macarthur Wind Farm near Warrnambool. This is the largest wind farm in the southern hemisphere with 140 3MW turbines, generating 420 megawatts. This project has created over 2,700 jobs in construction. It has the capacity to generate enough clean energy to power 220,000 average Victorian households per year, and to save approximately 1.5 million tonnes of greenhouse gases per year. This is the future. When you compare the clean energy to the problems we were having with brown coal in Hazelwood, I think the community would prefer to have clean energy generated by strong winds off Bass Strait.
The price on carbon had its intended impact on industry—the largest consumers of power and producers of carbon. In July 2013, ClimateWorks published a report on the impact of the price of carbon on industry. This research involved in-depth interviews with 47 large industrial companies that account for 70 per cent of Australia's industrial energy use. Eight-one per cent of respondents reported that the carbon price had a relatively small financial impact, but it focused their attention on energy and carbon management. The presence of the carbon price appears to have had a greater impact than its financial value, as most respondents reported that becoming liable under the carbon price scheme has forced their attention on energy and carbon management. Across our nation industry has been focused on reducing energy intensity. This has the added benefit of saving money for industry and creating a modern and efficient industry.
These bills are a backward step for our nation. While the rest of the world is implementing a price on carbon or has been pricing carbon for years, we will be dismantling a successful scheme. The coalition will replace world's best practice with a plan to subsidise Australia's polluters with their direct action policy. Under the coalition's direct action policy the government will establish a fund—a slush fund—to give Australia's biggest polluters $3 billion over four years. Frank Jotzo, the head of the Centre for Climate Economics and Policy at the ANU's Crawford School of Public Policy, and Paul Burke, an economist with the Crawford School of Public Policy at the ANU, investigated the coalition's scheme and found that any discretionary subsidy approach is in danger of fostering a culture of rent seeking with its adverse impacts on the overall economic policy-making framework. Companies were likely to seek funds that they would have spent even without government support— (Time expired)
I rise today to encourage my fellow members of the 44th Parliament of Australia to continue to address the matter of climate change. Scientists and members of the Australian public know and understand that carbon pollution is real and changing our weather, our landscapes and our future. Tony Abbott's policy removes the legal cap on pollution and allows the big polluters open slather. Instead of polluters paying, Tony Abbott is setting up a slush fund of billions of taxpayers' dollars to hand out to polluters. Experts agree that this will cost households more while failing to cut pollution.
I believe climate change is real. I believe in a carbon emissions trading scheme. I believe we owe it to our children, our current and future generations. I believe that the big polluters should pay for their emissions. Unlike the coalition's Direct Action Plan, which directly slugs taxpayers to pay the big polluters, Labor's plan makes the polluters pay for their carbon emissions. In a minute I will talk about the current and future impacts on the Northern Territory as a direct result of climate change, but first I quickly want to address the cost-of-living impacts in the Northern Territory as a result of pricing carbon.
In the Northern Territory the government owned Power and Water is the sole provider of power and water. There is no reticulated gas to the home, and Power and Water provides consumers with a single quarterly bill for their electricity, water and sewerage usages. When the carbon price came into effect in the Northern Territory on 1 July 2012 the average power bill increased by $2.61 a week or $135 a year. Since then, the incoming Country Liberal Party government in the Northern Territory—who, incidentally, promised to cut the cost of living—have has announced increases to household power bills of $2,000 a year. That is $135 versus $2,000 a year. Let's be very clear: the increases to power and water costs to families in the Northern Territory since the introduction of the price on carbon are insignificant compared to the impact of the Northern Territory government's increases. Only around six per cent of the increase in people's power bills in the last 18 months is the result of the price on carbon. The other 94 per cent of the increase is due to the CLP.
The CLP has increased the price of power 15 times more than the carbon price did, and with the carbon tax the average Territorian received around $10 a week in compensation from the Commonwealth. No such compensation came with the CLP's $2,000 a year increase. The CLP ran election TV commercials campaigning against the cost of power—even going so far as to say that they dreaded their own Power and Water bills arriving in the mail. Then, less than three months after being elected to office, they put them up by $2,000 a year. It seems that saying one thing before an election and then doing the complete opposite afterwards is becoming a trend for incoming conservative governments. Since then, the Northern Territory government has announced even more increases are to come and any drop as a result of the removal of the price on carbon will be more than offset by the CLP's increases. Anyone in the Northern Territory who thinks their power bill will come down as a result of the removal of the carbon tax is in for a rude shock.
But what we are really talking about today is the future of the planet. Many other speakers have spoken in great detail about the science of climate change and the impact on the planet. I will confine my comments to the threats facing the Northern Territory. Like the rest of the planet, the Northern Territory is exposed to the threats of climate change and rising sea levels. Many of the coastal areas of the Territory are low-lying and some of Australia's most iconic wilderness areas are exposed. This includes some of the most intact coastal and marine habitats in the world. Kakadu is extremely exposed to the infiltration of salt water into Australia's greatest freshwater wetlands. A sea level rise of only a few centimetres has the potential to increase the intrusion of salt water into a large fraction of the flood plains. This will completely alter and degrade the biodiversity of Kakadu. It is also expected to increase the growth of weeds and invasive grasses, which will dramatically increase the prevalence of bush fires both in Kakadu and throughout the Northern Territory.
From droughts in the south to cyclones in the north, the Territory is very prone to natural disasters. Darwin and all the Territory's coastal communities are in cyclone zones. Any rise in the sea level substantially increases the threat of flooding as a result of cyclones. While cyclones used to be the major threat, improvements to the building code in places like Darwin mean that floods now loom as the biggest danger. Anyone who doubts that the sea levels are rising needs only to go for a walk along the scenic Darwin foreshore. The bike track along the famous East Point is constantly being rebuilt and redirected, as parts of it fall into the sea due to coastal erosion.
Most Australians would appreciate the incredibly important connection to the land, the sea and the environment that Indigenous Australians have. Of course, I do not pretend to speak for every single Indigenous Australian but I know I speak for most when I say that Indigenous Australians want their country protected from the threat of climate change. Many Indigenous organisations are working towards their own endeavours to reduce carbon emissions.
In August last year Darwin hosted an international forum where the importance of traditional land management practices being used to combat the effects of climate change was discussed. Organisations such as the North Australian Indigenous Land and Sea Management Alliance have long been advocating for policies to address climate change and to protect the environment. In fact, they have a carbon program that targets the reduction of emissions from wildfires. I am aware that the second Intergovernmental Panel on Climate Change report says, 'There is high agreement among scientists that Indigenous people will face significant challenges from heat stress, extreme weather events and heightened rates of disease by 2100.'
This is not just confined to Indigenous Australians; all Australians will certainly be affected. The Territory, like the rest of the world, is extremely exposed to the threat of climate change. We need to take action; we need to reduce emissions. And a price on carbon is the best way to go. We want to tackle climate change in the most cost-effective way. That is why we support an emissions trading scheme that puts a legal cap on carbon pollution and lets business work out the best way for them to cut emissions.
The economic future of the Northern Territory is linked to gas. There are abundant reserves in the seas to our north and some of the biggest projects in Australia are occurring right now, bringing this gas onshore to Darwin. Gas is a relatively clean source of energy, and a price on carbon increases the relative economic returns of gas versus those of dirtier energy resources, such as brown coal. A price on carbon makes gas relatively cheap and making gas relatively cheap is a great economic opportunity on a global scale for the Northern Territory.
This bill reduces the relative value of gas which, again, reduces the relative economic opportunity for the Northern Territory. As I mentioned earlier, the fundamental difference between Labor's approach of putting a price on carbon and the coalition's so-called Direct Action Plan is that Labor's approach will work to cut carbon emissions and the coalition's will not. This is the accepted view of the vast majority of scientists, economists and business leaders who have assessed two models. Aside from the science, there is also a fundamental ideological difference between the two models. Labor's model makes the polluters pay; the coalition's model makes the taxpayers pay the big polluters. The coalition's model gets taxpayers to pay the big polluters, even if they do not cut their emissions. Most taxpayers do not realise that the coalition's plan involves directly hitting the hip pocket. Their Direct Action Plan involves subsidising the big polluters from government revenue, which could be used for health and education.
At the recent election, Labor promised to fast-track the move towards an emissions trading scheme. Our position on the repeal of the carbon tax was clear then and remains clear. We support removing the tax but do not support doing nothing. An emissions trading scheme has always been the preferred approach and Labor has been advocating for it for over a decade. We are far from being alone. The Organisation for Economic Co-operation and Development confirmed that countries can achieve higher levels of emissions cuts at a much lower cost if they use an emissions trading scheme. Emissions trading schemes are already being adopted in many countries around the world, including the UK, France, Germany, South Korea, Canada, and parts of the US and China. The Liberals in Australia, at one stage, also supported it. They went into the 2007 election campaign supporting an emissions trading scheme. That was their official policy during the election campaign.
Of course, once they got into government, they backflipped and voted against the legislation in the Senate. John Howard recently admitted that his support of a trading scheme was purely motivated by short-term political opportunism. Saying one thing before an election and doing the opposite after is not new ground for the coalition. If anything, it is par for the course.
Tony Abbott's rise to the prime ministership was built on his climate change scepticism—not just scepticism but denial. No Australian really believes the Prime Minister when he mouths the words that he accepts the science of climate change. And I do not believe that Tony Abbott truly believes in his own direct action policy. It is a policy of convenience, a policy that pretends to care about climate change and a holding policy, if you will.
If this bill gets through, then I would not be surprised if the coalition were to turn their attention to how to wriggle out of their direct action policy. It would certainly conform with the underlying belief of their leader, Tony Abbott, that we should not be doing anything to address climate change. You can almost picture it now: the day that they have legislation to remove a price on carbon, to remove any more progress towards an emissions trading scheme they will start working out how they can come up with an excuse to scrap their direct action policy.
Beyond climate change I am extremely concerned about the approach that this Abbott government takes to science. We no longer have a minister for science, and organisations such as CSIRO are being targeted for massive budget and staffing cuts. Organisations such as CSIRO are key to contributing to an informed and independent discussion and analysis of, among other areas, climate change. Surely, in this day and age, organisations such as CSIRO should not only retain their funding but should receive increased resources to move Australia into a responsible age when dealing with the environment. This Abbott government has a fundamental opposition to science. We now hear that instinct is more reliable than science.
Let us make it clear: we on this side of the House are opposed to this obvious, deliberate shift away from responsible action on protecting both our environment and Australians. Recently, a groundbreaking memorandum of understanding to create the world's first tropical environment focused tidal energy research centre in Darwin has been signed by Tenax Energy and Charles Darwin University. The testing centre and associated pilot plant is the first step towards delivering affordable tidal energy to Darwin by the end of the decade. The establishment of a world-class, commercially oriented research and testing facility aims to stimulate collaboration in tropical tidal energy generation globally across research institutions and device manufacturers.
The world’s biggest test site, the European Marine Energy Centre, in Scotland, is already at capacity and we see significant opportunity in taking what we learn about the tropical environment in Darwin to supporting growth in the Asian sector.
This initiative, which involves Charles Darwin University, will pioneer research into the interaction of these technologies with the tropical environment. It is hoping to attract a range of people with professional and trade qualifications in marine, electrical and structural engineering disciplines across the renewable energy spectrum. This initiative offers associated research opportunities in environmental science and economies. Initiatives such as this have the potential to redefine Darwin's relationship with Asia for the better. What sort of message does the coalition's approach to climate change and the environment send to other countries? It is certainly seen as a backward step.
The Territory is the perfect place for investment in climate change and the safeguarding of the environment for future generations. This is an industry that will create green jobs—jobs which will only increase in the future. If the rest of the world is any indication, this is an area that will continue to grow. We should be investing in green jobs today. Alice Springs is another success story when it comes to the research and development of renewable energy. The Alice has some of the highest solar radiation rates in Australia and is a key international tourist destination. The residents of Alice Springs are behind renewable energy and continued support for our environment. Approximately half of the households in the Alice already use solar hot-water systems. This is mainly due to Alice Springs investing in the development of a potent solar industry, and it has received strong community support for this project. Alice Solar City's large-scale iconic projects, which maximise the potential of natural and economic benefits, are centrepieces of the trial. As the Northern Territory government's own website on the topic reads:
Alice Solar City also provides a comprehensive range of energy-efficiency incentives to residential customers via a voucher system. It is the only Solar City consortium led by a local government body, making it a truly grassroots community project.
Under a Territory Labor government, the Territory's ability to generate clean, green energy received a significant boost with the launch of its first renewable energy research facility. It was said at the time that this new centre would be the backbone of renewable energy development in the NT. Our current minister for the environment, the Country Liberals' Peter Chandler, is on the record as saying that Australia's scientists were 'playing the climate change game' to make money. Mr Chandler went on to say:
They are the ones that are making a dollar out of governments and businesses around the world …
He later admitted that he was not a scientist but that the belief that man-made carbon dioxide was driving the world towards a natural disaster was 'a load of crap'.
The CLP's Deputy Chief Minister, Dave Tollner, is also a climate change sceptic—even though the majority of the world's leading scientists believe that man-made carbon emissions are causing the planet to heat up dangerously. These are the people who represent us and who choose to ignore the rich potential for climate change and the critical environmental research underway in the Northern Territory. Their sentiment is, I believe, strongly echoed by the federal government's new approach. The Territory has many potential sources of renewable energy and is already attracting significant investment interest in its solar, tidal and geothermal energy possibilities. It would appear that those projects and the organisations that believe in climate change, that believe in the science, are being targeted at both a Territory and a national level.
In conclusion, this bill does not accept the science of climate change. This bill does not accept the economics of climate change. This bill will not address the threat of climate change. This bill will help big polluters, not taxpayers. This bill will not result in a reduction to power bills in the Northern Territory. I oppose the bill.
I rise to make a contribution to the debate on the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and related bills. I am with Senator Marshall: I do believe that we have a mandate to vote according to the people who sent us here. The South Australian election was on the weekend. I and, presumably, coalition, Labor and Greens senators and members of the House of Representatives met with hundreds of voters. I think 1,793 people come through the booth that I was on. The interesting thing was that not one of them raised the carbon tax. Not one of them said: 'Repeal it. Back the Abbott government's position.' In fact, to my recollection, it was never mentioned in the campaign. It is an invisible issue, if you like, in the electorate.
But what is not invisible is the fact that a lot of Australians travel. A lot of Australians have been to Mexico City, Los Angeles, Beijing, New Delhi and Rome—cities where lots of people live and where the effect of climate change and pollution are all too apparent to them as they go about their daily tasks and business or as they enjoy their holiday. What is not invisible is the impact of the economy on society and the places in which we live. I come from a background where coal was burnt every day. It went up through the chimney, obviously, and fell back down on the surroundings. If you visit those places now, you will find them incredibly clean and incredibly vibrant. They are a lot better off now compared to when they were basically remnants of the Industrial Revolution.
As Senator Marshall said, we cannot deny people to our north, in Asia, the right to advance their societies, to improve the lot of their people, to bring themselves out of poverty and to have good, useful opportunities in life. They will take that opportunity. We know that China leads the world in everything. It leads the world in nuclear power and in wind power. In some cases it is now leading the world in a lot of the science. It also has coal fired and gas fired generators. If they are to take 200 million people out of rural poverty and give them a chance in life, they will continue to do what is necessary to achieve that. If that means they put in a coal fired generator, they will do that. If they could put in nuclear, they would do that. Very clearly, we live in a place where the demographics are hugely challenging for all governments in this part of the world.
We have lots of young people who have aspirations. They have access to the internet. They want good jobs and they want the same things that we now enjoy. What I think is really disappointing is that Australia is not taking the lead on the climate change argument. And I understand all the arguments. I was chair of an investment committee long before the legislation passed this parliament, and there were people there supporting a carbon price mechanism—not a carbon tax; a carbon price mechanism—because it is abundantly clear, and this government, of all governments, should know that if you want to change something in the economy you price it. If you want to change anything in the economy, you put a price on it; you put it up or down. That is a proven economic way of changing behaviour.
To me, the Direct Action Plan, which I will refer to a little bit later, is counterintuitive for the Abbott government's market-driven economic rationale. How do you change things? You change things by pricing them. You price them up, you price them down and behaviour changes. You do it with road safety: you price speeding and behaviour changes. With drink-driving, you go to jail or you pay a fine, so behaviour changes. In the economy, if you price carbon, it will change behaviour. And behaviour has changed—maybe not as much as everybody hoped, maybe not as much as everybody wants, but it will change. Over time, it is the only proven mechanism for a successful economic strategy.
The background here is that the government are repealing the carbon price legislation on the grounds that it places an unfair cost burden on Australian businesses and households; it is allegedly inefficient and wasteful; it has not led to a reduction in greenhouse gas emissions; it is not matched by comparable action internationally; and the electorate gave the coalition a mandate to repeal the CPM. Essentially, the government have said that the election was a referendum on the carbon tax, but that does not really stack up.
The cost to Australian businesses and householders is one point I want to address. The carbon price directly applies to around 350 businesses. Clearly, costs incurred by those liable businesses in complying with the CPM may be passed on downstream to businesses and final consumers. But the expectation was that the CPM would only add 0.07 per cent to the CPI, or around $9.90 a week; and, in the context of significant expected increases in electricity, 10 per cent. So, for some, the cost of the CPM includes not only these direct costs but also maybe forgone production because they are changing. We have an example that in South Australia, where we have a brown-coal fired generator that basically only kicks in when there is a peak load in South Australia or Victoria and, through the National Grid, they can make some dollars.
As for households, the impact of rising prices on most households was largely offset by the compensation package that we paid, which consists of increasing the tax-free threshold to $18,000 and making additional transfer payments to eligible persons and households. Our government claimed that households would receive a combination of payments or tax cuts worth an average of $10.10 a week, and that nine out of 10 Australian families would receive assistance.
There you have it, Mr Acting Deputy President Sterle. It is a price on carbon for 350 businesses—sure, that changes their behaviour, the way they do things, but they are allowed to pass it on downstream—and we paid a compensation package to households.
This has all been wrapped up in an entirely cynical political argument led by Tony Abbott. Let us not forget he only got in by one vote. Let us not forget it was carbon pricing that delivered the leadership to the opposition and, ultimately, the prime ministership. Carbon pricing is in his blood because it has actually put him where he is. In is ruthless pursuit of power, he has essentially put up a position which does not stack up when you take into account what scientists are saying, it does not stack up when you take into account how you change behaviour in the economy and it does not stack up against the behaviour of the voting public.
The coalition have been very clear: 'We have a mandate. We have a mandate.' Well, let us have a look at some of the polling that was done on 5 September 2013. Essential Research polling asked voters on 5 September, 'Which of the following are the main reasons you will vote for that party?' For the totality of respondents, the three top answers chosen were: 'They are better at handling Australia's economy', 'There are more likely to represent the interests of all Australians' and 'They are better at looking after the interests of people like me'—well, that would probably apply to most Liberal voters; that is why they vote Liberal. Out of the 13 options, 'having better policies on things like the environment and climate change' ranked 10th when all respondents were included. For coalition voters, 'better policies on things like the environment and climate change' ranked last, after 'Don't know' and 'No reason'. Only one per cent of coalition voters ranked climate change policies within the three top reasons for voting for that party. However, it could be argued that many respondents might not consider the repeal of carbon pricing a real issue.
Clearly, carbon pricing is a political football. This was the 'great big new tax on everything'—which clearly it was not. It was a tax on 350 businesses and it was adequately compensated for in nine out of 10 Australian households. We all know that the only ones who have ever put a great big new tax on business are the coalition, with the GST—because that does go on just about everything. The carbon pricing mechanism is not a great big new tax on everything; it is an attempt in a proper, well-thought-out way to change behaviour to ensure that our children and our grandchildren have the same quality of air and the same quality of life wherever they live in this great country of ours. It is to ensure that we are a beacon of leadership in this part of the world. As I said earlier, we do not have the pressure of 200 million people coming out of rural poverty into our cities but we can see on our TVs that people in Beijing and other major cities in China virtually cannot breathe, and doing hard physical or manual labour in that sort of climate is problematic. The human cost of all of that must be enormous. The human cost of people living and choking to death in a polluted environment must be absolutely enormous. Surely no-one can argue that nothing is happening.
In a previous contribution on this matter, I pointed to the reinsurers of the world. The reinsurers of the world are the people who pick up the tab. We all pay our insurance and, when things happen, they pay the bill. We get paid by our insurer and our insurer then claims back from a global reinsurer. The global reinsurance market is worth trillions of dollars. Since 1977, the big reinsurers have been saying that natural disasters are happening a little bit more frequently and impacting a little bit more severely. The planet is becoming more heavily populated, so you could argue that a storm 30 years ago might cause less damage than a storm today. But it is difficult to argue with the frequency change—the fact that these things are happening more often.
Ultimately, we pick up the tab for climate change. You cannot hide from it. We insure our dwellings, our businesses and all those sorts of things. If we are afflicted more often by severe natural disasters then, ultimately, insurance premiums go up. People in Queensland know all about that, as do people in places where there have been extreme bushfire events. As Australians, we band together and get people through those events. In the Queensland floods, the then Premier and the then Prime Minister did a fantastic job. Eventually, however, insurance premiums will go up—so we are going to pay. One way or the other, we are going to pay. When we introduced the carbon pricing mechanism, we included a package to compensate people for any price effects. In the absence of a carbon pricing mechanism, however, consumers will be paying—because that is the way the system we all live in and enjoy works.
Doing nothing—taking the low road on carbon pricing—is not really a sensible option for this country. Given our pre-eminent status in this part of the world, we should be showing leadership. Western society has had its industrial revolution. We have been through the stage of having coal fires in every household, with all the pollution that entailed. In our little city of Adelaide, a nice big country town, there used to be incinerators in everybody's backyard. We just burned the rubbish. It went up, hit the hills and dropped back down on us again. We know these things are wrong and we can take action to change them.
The government's position on this is entirely political. The Hon. Tony Abbott, the Prime Minister of this country, got into the job of opposition leader by just one vote. One of the most divisive issues in the Liberal Party was climate change. People like Malcolm Turnbull were on one side of the debate, but others took the opposite position.
We know the Prime Minister is wedded to abolishing carbon pricing. But this is a really bad look internationally, a bad economic decision and bad for our children and grandchildren. We do not want Sydney, Melbourne, Adelaide, Brisbane, Hobart and Perth to become like the cities a few hours flight to the north of us. We want Australia to be, as it is now, clean and pristine. We want all Australians to have the opportunity to enjoy a reasonable economy whilst making advances—making the place cleaner and greener.
Part of the coalition's strategy is a large range of initiatives to boost renewable energy. They have missed the boat. South Australia under Mike Rann led the renewable energy debate in this country. We have wind power. We have made significant changes. We have the most solar panel systems per capita in Australia—a huge investment. The scheme has been oversubscribed. I am not a great fan of solar power because I do not understand how we can avoid passing the cost of the input credit onto more vulnerable consumers—pensioners on $250 a week, for example. So I have that one concern about solar power. But South Australia has made great progress in renewable energy. If the Hon. Tony Abbott is going to pick up South Australia's mantle and charge away with it, good luck to him. I doubt if he will write to Mike Rann to thank him for having been prescient in pushing renewable energy so vigorously and so successfully.
The Direct Action Plan says we are going to plant another 20 million trees. On the weekend, though, I think I heard something about more trees being pulled down in a place called Tasmania. That is fine—I am not anti-forestry. But apparently we are going to plant an additional 20 million trees. If the Prime Minister comes to Adelaide and wants a hand to plant a few trees, I am up for that—because I like trees and I think we should have plenty of them. The history in South Australia is that we cut them all down for things like the copper mines at Burra and other places. I agree that we should plant more trees—great. But is that a genuine, internationally recognised, well-thought-out economic strategy for dealing with carbon pollution? I am not sure that it is not just intended to be a vote winner rather than a clear and prescient mechanism for dealing with what is a very important 21st century issue.
This issue goes to the heart of why a lot of people are in politics. As Senator Cameron pointed out the other day, even Robert Menzies said that occasionally you come across an issue you have to advocate for. If you believe in it and people are against you, you have to advocate for it. If you still face opposition, you have to advocate for it again. You have to do what is right. At the end of the day, it is incumbent on every senator in this place to do what is right. It appears to me that there is overwhelming evidence that a carbon-pricing mechanism affecting 350 businesses, with appropriate compensation to nine out of 10 households, is capable of changing behaviour for the better.
It is not a great big tax on everything. It has been portrayed as that quite deceitfully and quite erroneously. The reality is that most of the increase in electricity prices is out of poles and wires. It is out of the privatisation of those poles and wires, which have now been gold plated. In South Australia, we probably have a minimum number of days where our peak of electricity is used; we have three to 10 days where we need the gold plating of our electricity. I accept that, politically, that has got to be copped; I do accept that. I saw in the Northern Territory the other day that that government has done nothing about electricity, and they shut down schools, hospitals and the Public Service. My daughter said that, at 1.30 in the morning, she was finding new friends—the ones in the street that had generators.
That is the result of not investing in electricity. But that was never articulated. It was all bagged up as 'carbon price: a great big new tax on everything', avoiding the fact that most of the increase in electricity prices has been driven out of the investment in poles, wires and generators, and that most of our state governments sold those things off. It is natural that the person who bought them wants to maximise their investment, and they have done very well. The Australian consumer may also benefit in the long term. But in the short term they got whacked severely, with an increase in electricity prices of up to 50 per cent in some states, which this government said was due to the carbon tax. That is absolutely wrong.
I, too, wish to contribute to the debate on the Abbott government's Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and the other bills in this package. These bills are intended to deny Australians the very best chance we have ever had of doing something about damaging climate change that is caused by human activity. These bills could have been the opportunity to move Australia to an emissions trading scheme. But all that these bills do is prevent any chance of that. Instead, if successful, these bills would bring to a complete halt Australia's good work so far in addressing climate change.
The bills are a deliberate attempt by the government to stop Australia reaching our internationally agreed carbon emission targets. They are a deliberate attempt by the government to cruel future investment in renewable energy technologies and a signal from this government to all the big polluters in Australia that it is okay to continue belching harmful pollution into the atmosphere with no fear of rebuke or intervention from the government. It is also an embarrassing signal to the rest of the world that Australia has gone from being a world leader and an innovator in the fight against climate change to being a weak, reluctant country, hostage to big polluters and, even more embarrassingly, in denial about the science that tells us that climate change is real and we are causing it.
We have already seen the Senate defeat two previous bills that the government had put forward in its war against the science that tells us that humans are causing damaging climate change that is both dangerous and escalating. Both the Clean Energy Finance Corporation, which works with other financiers and project proponents to secure finance for renewable energy initiatives and low-emission technologies, and the Climate Change Authority, which provides independent factual evidence based scientific advice to government, have been targeted for demolition by this government in previous bills—which, thankfully, were defeated. We can all only hope that this package of bills will also be defeated, although we know that the government will continue to pursue its dismantling of Labor's excellent climate change initiatives regardless. That is a very disturbing thing to have to confront.
But this government enjoys undoing great reform initiatives—the kinds of initiatives that only Labor governments ever have the courage to introduce and to prosecute. We have seen the Abbott government backtracking on education reform. We have observed their lust for dismantling our precious universal healthcare system, Medicare, and their absolutely perverse delight in trying to use this term of office to bring back an industrial relations free-for-all—despite the Prime Minister promising before the election that WorkChoices was dead, buried and cremated. We did not believe him then when he said that, and we will never trust the coalition when it comes to protections for working Australians. We will never trust them to do what is right for the majority of Australians, and we certainly cannot trust them when it comes to action to protect our environment.
But there was a time when the coalition shared Labor's view that international targets for reducing carbon emissions were a good thing and that Australia should do its bit by implementing a domestic emissions trading scheme, which was universally agreed—even by most people in their own party—as the most effective, economically sustainable method of reducing pollution. Even former Prime Minister John Howard said that was the way to go and went to the 2007 election saying so. Australia, with one of the world's highest per capita carbon emissions outputs, was, under Labor, seen internationally as a leader: an ethical, progressive country prepared to do its bit to reduce its own emissions and, importantly, to help developing nations reduce theirs. We know that, of the $650 million to be slashed from Australia's overseas development aid projects, $250 million of it will be taken from countries in our own region. Many of the projects Australia has been funding in those countries—our near neighbours—were helping those nations to tackle the problem of climate change. We used to be a leader in that field too, but we are not anymore.
Sadly, Australia is gaining international notoriety for all the wrong reasons. For example, the legislation before us today was highlighted by the GLOBE Climate Legislation Study last month and subsequently made international headlines. That study examined legislative action in 66 countries, with the European Union considered as one entity, and included major nations such as the US, China, India and Brazil—countries that account for almost 90 per cent of global greenhouse emissions.
The study found that Australia is the only country currently pursuing negative legislative action in the area of climate-change policy. While demonstrating that the rest of the world knows meaningful progressive action on climate change is required immediately, the GLOBE study categorically shows that Australia is the one nation that has engaged the reverse gear and is heading backwards. Of the 587 climate laws across those nations the study examined, Australia is the only one that is back-pedalling on its legislation. This led the GLOBE chairman and former Conservative Thatcher government minister Lord Deben to criticise Australia's actions. He said:
'Australia is very disappointing …'
He described the actions of the Abbott government as a reversal, adding that, for Australia to begin to repeal climate measures following its hottest year on record was:
'… so unintellectual as to be unacceptable; I mean it is just amazing.'
Unintellectual and unacceptable pretty much sums up the Abbott government's attitude towards climate policy. I am not altogether sure it is amazing; I think it is more predictable—just as it is predictable and stupid that this government continues to blame the carbon tax for every one of its own failures to protect the future of Australians. It has become a farce. It is the stuff of comedy now on our televisions and it is embarrassing. I am waiting for the carbon tax, Mr Acting Deputy President Gallacher, to be blamed for Carlton's loss to Port Adelaide last night!
When it comes to blaming the carbon tax, and the mantra that the carbon tax is to blame for everything, it is not funny when it comes to jobs. Every time there is a job loss—and tragically there have been plenty under this government—the carbon tax gets the blame. Even when companies themselves deny the fact, even when it is patently untrue that the carbon tax is the sole or major contributing factor, there is no attempt by the government to apply intellectual rigour to understand the underlying economic considerations that are causing companies in Australia to fail or to shed jobs. There is no coherent government plan to work out how to save jobs or, more importantly, to create new jobs. Indeed, as we can see from the various repeal bills being considered by the Senate, instead of supporting companies and projects that could create modern, new jobs in the clean-technology sector the government is undoing the mechanisms that could do that.
As I have said before in this place, while hell-bent on undoing Labor's progressive, efficient and internationally regarded transition to an emissions trading scheme, the Abbott government maintains a policy fig leaf to cover its embarrassing and indefensible exposure on climate policy. That fig leaf is the government's so-called Direct Action Plan, which has at its core a $1.55 billion emissions reduction fund. It is currently subject to a green paper but it is also subject to some entertaining and disturbing examination by the Senate Environment and Communications References Committee, which is currently undertaking an inquiry into the Direct Action Plan.
The fact that the government still has not settled the details of the Direct Action Plan indicates that this is a policy in trouble. It was announced before the election, and here we are a good six months after the election and we still do not know what the cuts are of the Direct Action Plan. That is because it was in trouble the day it was cobbled together by a desperate then shadow environment minister, Mr Greg Hunt, and it is still in trouble—and the now environment minister is still in trouble.
The mad haste with which this repeal legislation we are debating was introduced into the parliament, before their Direct Action Plan was finalised, has created great uncertainty and the potential for a policy void. Indeed, last year, as part of the inquiry into these bills, the Waste Management Association of Australia made the point:
Seeking to repeal the existing carbon legislation prior to Direct Action being implemented, or known with greater certainty, risks a period of great uncertainty between repeal and Direct Action.
That uncertainty continues, as evidenced in the Senate inquiry currently afoot. That evidence also points to the huge problems and flaws in a scheme like Direct Action that operates on the basis of paying companies for abatement—abatement that is both hard to measure and hard to prove as being caused by the initiative for which the company is being rewarded and for which the taxpayer is paying.
For example, the Energy Supply Association of Australia—hardly a fan of the ETS—indicated, in its submission to the Senate inquiry, that it is worried about the measurement of abatement and the detail of what happens after 2020 when, apparently, funding to the Emissions Reduction Fund ceases. The association said in its submission to the Senate inquiry:
It is crucial that the design of the ERF ensures that payments are only made for genuine incremental abatement that has been measured, reported and verified.
The association also said:
The development of the ERF requires clarity of the management of longer term proposals where benefits and payments would be required beyond 2020 to be viable.
Other disturbing evidence from the Senate inquiry comes from the investment community, which pointed out that the government's rejection of the ETS and proposal of a half-baked, poorly formed Direct Action Plan is causing clean-energy investors to look elsewhere than Australia. Everyone knows that businesses need certainty about government legislation and regulation if they are going to invest. That is why, while they may not have liked it, at least industry accepted that an ETS was a long-term economically responsible way to change polluting behaviour.
The Senate inquiry heard from Mr Tim Buckley, from the US Institute for Energy Economics and Financial Analysis, who advised the Senate that Australia's clean-energy industry was regressing because of a lack of clarity on policy and that Australia is now missing out on hundreds of billions of dollars of investment in renewable and energy-efficiency technologies as well as missing out on the hundreds of thousands of new jobs being created in this sector in China, Germany and America—jobs being created anywhere but Australia, which, as we know, urgently needs new jobs in new industries.
Again from the Senate inquiry into the Direct Action Plan, Professor Ross Garnaut, who is a real economist, made the point that many economists have made: the Direct Action Plan is potentially an economic disaster for Australia. The government has promised $1.55 billion to pay companies for abatement over three years. But, if Australia is to continue to strive to achieve the more ambitious emissions reduction targets that we should be committed to, that will cost a lot more—up to $4 billion or $5 billion per annum, according to Professor Garnaut. So where would that money come from, or is this government not serious about achieving emissions reductions and signing up to more comprehensive targets? Anyway, you have to ask, where is the initial $1.55 billion going to come from? This is not clear to us. It can only come from cuts to government spending in other areas.
Finally from the Senate inquiry, the Climate Institute noted in an answer to a question on notice:
Fundamentally, as it currently stands the ERF will not be an enduring climate policy for a number of reasons. It does not include broad-based limits on emissions, links to international markets and an explicit price on emissions, all of which are necessary to achieve emissions reductions at the required scale in the short and longer term.
With the Direct Action Plan's Emissions Reduction Fund scheduled to be established from I July 2014, businesses need to know exactly what is on the table and how much it will cost them to be part of it. The renewable energy industry needs to know what is going on so it can plan for the long term and attract investment before it all goes overseas to China and to other countries which are taking over from Australia's leading role in the renewable energy sector.
People, presumably those with land, need to know where the 20 million trees are to be planted, and communities need to know which towns and which schools under the Direct Action Plan are going to go solar? Australians want to know: will the Direct Action Plan really work or are we going to be forking out money to companies without knowing if the abatement they claim is real, ongoing and not the effect of some unrelated cause? What is going to happen in 2020 when the Emissions Reduction Fund winds up? Where is the green army going to be marching to, who is going to be dragooned into it and what are they going to be doing? Where are the answers to these questions? What is Australia's position going to be in the 2015 international negotiations to set new emissions reduction targets for 2030? Are we still really committed to achieving our existing emissions targets or not? Presumably these questions will be answered in the government's white paper, which is due any minute now, I understand, but somehow I doubt that any satisfactory answers will be provided in that paper.
Unlike the Direct Action Plan, emissions trading schemes have been trialled and implemented in a number of other countries around the world. Australia is one of 35 countries that already have national emissions trading schemes covering a total population of more than 560 million. There is no other country in the world that relies on a grants tendering scheme like the coalition's Emissions Reduction Fund as its primary policy to reduce emissions. It is not surprising that no other country is relying on a policy thought bubble like the Direct Action Plan to achieve emissions reduction targets.
Australia is a large emitter of carbon dioxide and one of the largest polluters per capita globally. We really need a scheme that will absolutely and conclusively reduce our levels of pollution. Instead, the government's alternative will rely on a fundamentally flawed methodology, because it is impossible to know whether emissions reductions are truly additional or if they would have happened anyway. No amount of rigorous policy design can fix that problem. We need an effective and efficient way of dealing with climate change, and the only way to do that is through an emissions trading scheme. The ETS does have widespread support. As has been mentioned in other contributions in this place, many other countries are already proceeding well down the path of an emissions trading scheme, and Australia should be doing the same thing.
In conclusion, I share the views of my opposition leader, Bill Shorten, who in his speech about why these bills should be defeated said:
We can look our children in the face and say, 'When we had the chance to do something, we did.'
I want to look at my grandchildren and say that too because, if we do not do something now to stop this damaging climate change, the task will be all that much harder for them, and the damage that they have to cope with will be all that much worse.
I rise this afternoon to make a contribution in opposition to the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and related bills. Reflecting on my involvement with this subject in my term in the Senate—over 5½ years now—it is a matter I have been involved in with several committee inquiries, one being the Carbon Pollution Reduction Scheme inquiry, the climate change inquiry and other related examinations of this subject.
It is a fact that Labor have always been clear on our position on climate change. We accept the science. We accept the fact that climate change is real and we need to do something about it. Conversely, Mr Tony Abbott believes the contrary. Mr Tony Abbott's policy removes the legal cap on pollution and allows the big polluters open slather. Instead of polluters paying, Mr Abbott is setting up a fund of billions of taxpayer dollars to hand to polluters. Experts agree that this will cost householders, with more failing to cut pollution. We want to tackle climate change in the most cost-effective way possible. That is why we support terminating the carbon tax if it is replaced by an emissions trading scheme that puts a legal cap on carbon pollution and lets business work out the cheapest and most effective way to operate within that cap.
Last year the OECD released a report confirming that countries could achieve higher levels of emissions reductions at much lower cost if they relied on this type of scheme. Emissions trading schemes have already been adopted in many countries, as we have heard in contributions from many senators here, including the UK, France, Germany, South Korea, Canada, China, the US and so on.
Australia's backtracking on climate change progression was highlighted by the release of a global climatic study in February 2013. The study of 66 countries across the globe found Australia is the only country taking negative legislative action on climate change. The study covers major nations, including the US, China, India, Brazil and more. In fact, I noticed that Lord Deben, head of the UK Committee on Climate Change—a Tory politician as well—slammed the Abbott government's push to pull back climate change policy. He said:
It lets down the whole British tradition that a country should have become so selfish about this issue that it’s prepared to spoil the efforts of others and to foil what very much less rich countries are doing …
We know that is a matter that needs to be resolved. It is interesting that that sort of comment is coming from the Tory government in the UK.
We know that the Liberals and the National Party do not accept the science on climate change. In fact, last year we heard the previous Prime Minister, John Howard, telling a London audience that those who accept climate change is real are a bunch of religious zealots and that he would trust his instinct rather than the overwhelming evidence of 97 per cent of the world's climate scientists. Mr Abbott accused the United Nations climate chief of talking through her hat, while Greg Hunt used Wikipedia to contradict her opinion in a BBC interview.
Mr Tony Abbott and the coalition have not been able to come up with one credible scientist or economist who is willing to stand up and back their climate change policy. I refer to one of the committees in which I was involved in 2009 which reported on the Carbon Pollution Reduction Scheme. There are a number of concluding parts in that report that demonstrate the need to act on climate change. I will touch on a couple of those. Firstly, in the conclusion of that report, in chapter 6, on the global challenge for climate change, the committee believed that the world should act to limit the concentration of greenhouse gases in the atmosphere and indicated that it is not an article of faith; it is a matter of prudent risk management. The earth is warming and, if no action is taken, the overwhelming majority of expert scientific opinion holds that average temperatures will rise further, almost certainly leading to further changes in the global climate, with severe consequences for humanity and terminal consequences for many other species.
I have been fortunate enough along the passage of my term to meet with many people from the Pacific rim on concerns about the rise in sea levels around some of the micro-islands that they reside on in the Pacific. They spoke about sea level rises already having an impact on their communities, and no doubt there is concern about humanitarian aid and refugees coming from those particular areas of the Pacific as a result of climate change and rising sea levels. Furthermore, in this report the committee saw no reason to question the judgement of scientists from the world's leading countries on this matter. It notes that none of the witnesses who appeared before the committee, even those most critical of the CPRS, argued that the science was wrong. Here you see relevant and credible scientists appearing before a parliamentary committee providing evidence that is real, justifiable and easily demonstrated.
The Stern review—one of the interesting pieces of evidence that the committee dealt with—dealt with the economy. Earlier senators spoke about this particular area. The report indicated:
Using the results from formal economic models, the Review estimates that if we don’t act, the overall costs and risks of climate change will be equivalent to losing at least 5% of global … (GDP) each year, now and forever. If a wider range of risks and impacts is taken into account, the estimates of damage could rise to 20% of GDP or more.
In contrast, the costs of action—reducing greenhouse gas emissions to avoid the worst impacts of climate change—can be limited to around 1% of global GDP each year.
Not only did we have scientists but we had economists appearing before that inquiry demonstrating real concerns about inaction on climate change. On the implications of not passing the CPRS, the report indicated:
Delaying action is not economically responsible. Rather, delaying action will have a range of negative effects on the Australian economy, including deterring investment decisions and delaying business planning decisions where the price of carbon is a feature of those decisions.
If my memory serves me correctly, a whole range of renewable energy people appeared before the committee on that inquiry—speaking on wave technology, wind technology and solar technology—and indicated that we were at the cusp of being at the forefront of introducing those sorts of technologies in our economy and communities to make sure that this country is the leading force in making renewable energy possible. However, we are going to lose it overseas to the likes of China, India and all the other developing countries if we do not act on it.
The dangers of uncertainty for business were clearly identified in the report. The submission to the committee from the Australian Bankers Association indicated:
Climate change has considerable economic, social, environmental and business risks. Continuing uncertainty is disrupting the efficiency of existing markets as well as creating difficulties with regards to financing terms and investment decisions. Australia needs leadership and early action to provide business, investment, operational and market certainty. It is important for Australia to take action now and minimise the impacts of uncertainty …
That was clearly highlighted throughout the inquiry and, essentially, that is why the committee made the decision to recommend the Senate pass those bills. History can demonstrate this, and it is in the Hansard on the third reading of those bills. It was an unfortunate circumstance. I was in the Senate during that term in government and saw firsthand the coalition and the Greens voting against the introduction of climate change legislation.
I should not reflect on all the coalition, because Senator Troeth, a Liberal senator from Victoria at the time, and Senator Boyce, a Liberal senator from Queensland, crossed the floor to vote with the Labor government, hoping to achieve the introduction of those bills. But—lo and behold—the Greens teamed up with the rest of the coalition, opposing the introduction of those particular bills. We would be in a better position today if we had an ETS in place and a scheme dealing with climate change.
I will also reflect on the recent position of economists. A recent survey showed that 86 per cent of economists back an emissions trading scheme as the cheapest and most effective way to tackle carbon pollution. Even the former Secretary of Treasury, Ken Henry, called the coalition's policy a 'bizarre' strategy which involves the government paying big polluters in a scheme that will cost more and will reduce productivity.
The Bureau of Meteorology has confirmed in 2013 Australia recorded its hottest year on record. The CSIRO and BOM have released their biennial climate report. It confirms Australia's hottest temperature has risen by one degree Celsius since 1910. I want to go to that report for a little while. It certainly maps a concerning future for our climate as a result of inaction if we do not tackle this issue. It says:
There are concerns in respect of increases in temperature and identified increases in extreme weather patterns, such as fire.
I want to get to this point as it regards the ocean. The report also indicates that:
… … …
Rates of sea-level rise vary around the Australian region, with higher sea-level rise observed in the north and rates similar to the global average observed in the south and east.
Coming from Queensland myself, I recently had the opportunity to go north and have a look around Cairns, as I do on a regular basis, and up the eastern seaboard to see the manner in which the Great Barrier Reef is dealing with these particular challenges. It is not just about climate change; it is also about extreme weather events, declining water quality, coastal development, overfishing and depletion of marine species. The Great Barrier Reef is one of the seven wonders of the world. It is a main attraction not just for other Australians but also for people from around the world. You only need to travel up there to see the number of tourists in this day and age. We are seeing a lot of Chinese come into the country to go out on the reef.
In fact, over 12 months ago I had the fortune to spend a little bit of time in the Whitsundays and go out on the outer reef to do a bit of snorkelling. It is great to see the situation as it stands out there on that amazing structure. While the Great Barrier Reef has shown some resilience in the past, the coastal zone is a highly contested landscape which is shared by many industries, including tourism, fishing, recreation, ports and shipping. The increase in all these activities combined with more extreme weather events, declining water quality, outbreaks of the crown-of-thorns starfish on the back of that, the potential for increased shipping accidents and port expansions means the GBR has at no stage been in a more vulnerable position. Not only Queenslanders but fellow Australians need to be mindful of that to make sure that we do not deplete and destroy a world phenomenon such as the GBR and make sure that it is viable. I do not want to see a situation like I have seen in other parts of the world where I have snorkelled on barren reefs that have been raped and pillaged as a result of climate change and other factors. There is nothing worse than snorkelling over a barren white block of coral as opposed to having a look at the beauty of the GBR and its environment as it stands up there at present.
Climate change is the most serious threat facing the reef. According to the GBR Marine Park Authority's Great Barrier Reef regional strategic assessment, climate change is likely to have far-reaching consequences for the region's environment. The report also highlights future climate change predictions which indicate: sea level rise; sea temperature increases; that the oceans will become more acidic; and severe extreme weather events. Effects of climate change also include coral bleaching, coral diseases, ocean acidification and more severe storms. Just last week there was the threat of three possible cyclones verging on the cape and its surrounds. Every time we have a cyclone rolling through it damages the reef. The more we have these extreme weather patterns coming through the more we face problems associated with damage to the reef and the surrounding environment.
There has been a lot of debate from the coalition on how they will deal with this area. We have heard today about this green army that is coming through. I am sure, Acting Deputy President Gallacher, that you would be aware that just the other day there were some media reports about the green army being paid half the ordinary wage. That has to be a concern in itself, given that it is clearly a demonstration of what the coalition has in place for these people who are prepared to come out and protect the environment. Their wages and conditions are another example of what the coalition does when it comes around to industrial relations. It attacks those people who are less vulnerable and more marginal, wishing to pay them half the ordinary wage rate. That would equate to somewhere around about $8.50 an hour. Can you imagine people going out into our environment and planting trees and being paid that sort of amount of pay?
But notwithstanding that particular issue, if history demonstrates itself, some of the coalition people—not necessarily in this chamber, but the other one—have indicated a proposal such as Dr Jensen's for some sort of shadecloth to be shot into orbit in outer space as a way to fight global warming.
No, this is true! He went on further to say that as a plan he had to be convinced about it, but this is his belief. When I heard about this, I thought this could not be the Dr Jensen that I know—and certainly not George Jetson or his boy, Elroy—but it is certainly Dr Jensen claiming that the best way to tackle climate change and protect the reef is to shoot these sunshades into orbit.
The US did some estimates based on how much this would cost, if it were possible, and the estimates have come back that it would cost $200 trillion dollars to make that come about. It is just another example of how those sceptics and the climate sceptics opposite us would deal with this particular issue of climate change. Something that we would watch on The Jetsons is the way they deal with those particular matters!
Returning to what is the future: it alarms me, as a grandfather—particularly as my granddaughter lives up there in Cairns and, hopefully, within a week I will be the proud grandfather of new grandson.
Thanks, Senator Mason. It concerns me that my granddaughter, Xavia, and my grandson, who will be named Marley, will be the beneficiaries of something that we do not know about currently. It is something that we take for granted at times when we travel to Northern Queensland and have the opportunity to go out on the Great Barrier Reef and do a bit of snorkelling, or spend some time up in the hinterland and see the dynamics and the environment as it stands. It is such a beautiful place to travel, and it will not be left to our next generations—whether it be our children or whether it be our grandchildren. They will be the ones to miss out on having the opportunity to have a clean environment. That is one of the main reasons why I oppose these bills before the chamber today.
I too rise to speak in opposition to the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and related bills in front of us. Before I do; I have listened intently to a number of speeches, but I reckon Senator Furner made that bit up about Dr Jensen from WA wanting to shoot shadecloth out into the atmosphere! Anyway, it got our attention. But then again, knowing Dr Jensen, anything is possible!
I just think I am simply at a loss to understand as to why on that side there is absolutely no consensus on the science behind climate change and a path forward for the future of our environment and our planet. Each speech that has been given by an opposition senator has quoted fact, has used scientific commentary and opinion, and has made reference to raw data that has been produced to show how much impact organisations like the Clean Energy Finance Corporation have had on the environment and the economy. I think that is great.
I am sure that government senators have been listening to what we on this side have been saying. Despite this and despite the information that many of us have used—which is readily available to them, as they only have to click on the internet—the coalition blatantly refuses to acknowledge, or even try to understand—or pretend to understand—that the systems that we put in place in government help the environment. They are working. The Clean Energy Finance Corporation is in the black. It is on track to cover all of its operational costs and it is reducing emissions by co-investing with businesses and industry groups to harness the use of renewable technologies, all while making a significant return to the government.
Now, the coalition and Mr Abbott talk about how they have a plan for direct action. Well, guys, I do not think you can could have action much more direct than this if you tried. This is the problem that we now have with this government. We have an organisation that is not only achieving great results for the renewable energy community but is also putting Australia in a strong position for a low-carbon world. What did the government want to do? They wanted to get rid of it. We ask, 'Why?' It is because they refuse to acknowledge that climate change exists and they refuse to see that the CEFC is achieving results that mitigate the effects of climate change through investing in renewable energy technology.
There is one government senator, however, who has seen the light. After the Senate committee hearing where the chair of the CEFC—Ms Broadbent—appealed to the government to keep the CEFC, Senator Sinodinos said that he was, and I quote:
…happy to go through the CEFC's annual report and have another look.
That was recorded in the Sydney Morning Heraldon 5 December 2013. Why would this be? It would not perhaps be because Senator Sinodinos has acknowledged that it would be in the country's best interest to keep the CEFC, would it? Rather than denying truth and fact like the coalition normally does when it comes to all things climate change, has Senator Sinodinos acknowledged that it would cause more harm than good to abolish the CEFC?
Senator Sinodinos' admission is a clear indicator that proves he did not know enough about the CEFC to make a legitimate comment on the matter. This highlights, unfortunately, the sheer arrogance of the coalition, in that they will stand and vote against something that they have not even made the effort of trying to understand. At the end of the day, they will completely ignore industry advice, science advice and opinion, and raw data on the environment to suit their own ideological goals.
Mr Abbott, just because you choose to remove a price on carbon and try to axe organisations like the CEFC and the Climate Change Authority does not mean that the issues of global warming and climate change are going to go away. The Illawarra Mercury reported on 30 October that the belief of hundreds of scientists from the Intergovernmental Panel on Climate Change has been reaffirmed, and that they are confident that greenhouse gas emissions have the potential to be extremely damaging and long-lasting. Yet under Prime Minister Abbott, Australia will become the first country to repeal legislation that requires big business to pay for the pollution that they emit. As Australians we should be ashamed of the behaviour of our representatives in government. They have taken Australia from being a leading global innovator in emissions trading to being an international pariah. Mr Abbott will be known as the Prime Minister who denied the science—and in doing so, he is at risk of denying our children, and their children, a safe and secure future. This is the legacy that he will leave behind for future generations; unfortunately, it will be for them to clean up.
I have quite enjoyed listening to some of the government senators during this debate. First up, I would like to make mention of the contribution to this debate—
Senator Mason interjecting—
No; there is a hook in the tail—through you, Mr Acting Deputy President, I was waiting for someone to pop up: congratulations, Senator Mason! No, I was in fact talking about Senator Abetz.
Senator Abetz could not understand why we wanted to separate the bills. My response to Senator Abetz would be: it is so that we could debate the need to keep important organisations like the Clean Energy Finance Corporation and the Climate Change Authority. If the government had its way, legislation would be rammed through the Senate without considering or debating the costs of abolishing the organisations established by the original legislation, namely the CEFC and the Climate Change Authority. This was deliberate on the government's part. They did not want the Australian people to know that the abolition of this tax will also mean the unnecessary removal of the Clean Energy Finance Corporation and the Climate Change Authority.
Senator Abetz went on to say that if we get rid of the carbon tax then there is no need for the Climate Change Authority. Now that is a stupid thing to say; to think that just because you get rid of the carbon tax, the advice provided by the Climate Change Authority—especially on emissions targets and carbon budgets—will not be needed. It says a lot about the coalition's commitment to the future of our environment. To say that Senator Abetz was misleading during his contribution would be an understatement. He said, 'The principal role of the authority is to provide advice concerning the ongoing operation of the carbon tax.' That was recorded in the Senate Hansard of Monday 2 December. Therefore, he suggests, if the tax goes, so should the Climate Change Authority. Senator Abetz obviously shares Mr Abbott's belief that once they—that mob over there—get rid of the carbon tax, the issues of global warming and climate change will just go with it. I think that those on that side are in for a very rude awakening. If Senator Abetz was honest with the Australian people, he would tell them that the Climate Change Authority does more than just advise on carbon pricing. According to its website, the Climate Change Authority is responsible for much, much more, including: reporting on and providing advice on Australia's emissions, reduction targets, carbon budgets and progress towards meeting Australia's medium- and long-term emissions reduction targets; the National Greenhouse and Energy Reporting System; the Carbon Farming Initiative; and the Renewable Energy Target. If the authority is abolished, where does the government expect to get this advice from? Well, I suppose if Wikipedia has worked for them in the past, it will work them in the future!
Senator Macdonald—another senator from the government side—actually gave me a bit of a laugh during his contribution—and it was not a funny laugh; it was a pretty sad laugh—when he likened the whole climate change debate to the Y2K phenomenon. For someone who has said that he believes that the climate is changing—and thank you for that revelation, Senator Macdonald—to then label this whole debate on the environment as being similar to the hysteria caused by the theory that a global computer crash would lead to the end of the world is childish, immature and completely counterproductive; his words, not mine. I had to scratch my head at several intervals during Senator Macdonald's speech, all the more so when he said this:
I have always said the climate is changing. Clearly it is. Australia used to be covered in ice once. The centre of Australia used to be a rainforest. Clearly the climate is changing. Is it man's emissions that have done it? I do not know; I am not a scientist. But I say again that there are a great number of reputable scientists who doubt it. I acknowledge there are a great number of reputable scientists who are absolutely passionate about the argument, but I might say I am not convinced. But I do accept the climate is changing.
That was recorded in the Senate Hansard of Monday, 9 December 2013. So what does that mean? Senator Macdonald believes that the climate is changing. He chooses to listen to the great number of scientists who doubt that climate change is man-made, but he acknowledges that there is an equally large number of scientists who believe that it is man-made. How hard is it to make the connection? Maybe I can make it easier for the senator: if we look at scientific papers published between 1991 and 2001, no less than 97 per cent of them argued that humans contribute to global warming. If that is not conclusive evidence, I do not know what is. He also admits that he is not a scientist. Well hello, Captain Obvious. This is why we on this side of the House listen to the science. That is why we do not listen to people like Senator Macdonald. As none of those opposite are scientists, and as none of them accept the science, how can they have a legitimate opinion on the science behind climate change? In stark contrast to the government, we listen to the people who have spent years studying the climate and the science behind how it works, so that our policies relating to the environment are the absolute best that they can be.
Senator Macdonald then goes on to say that no-one has ever explained to him why Australia should lead the way when it comes to cutting emissions. Senator Macdonald must not have been listening to his former colleague and Prime Minister, Mr Howard, when before the 2007 election at the National Press Club, he had this to say:
Being among the first movers on carbon trading in this region will bring new opportunities and we intend to grasp them. The Government will examine how to ensure that Australia becomes a carbon trading hub in the Asia-Pacific region. Of course, an emissions trading scheme is only one part of a comprehensive long-term climate change policy framework. Low-carbon technologies remain the key to an effective response that minimises the costs of limiting emissions.
That was Mr John Howard and it was an address at National Press Club on 17 July 2007.
We obviously found out later that Mr Howard had no belief in climate change whatsoever and only acted on this because he believed that it was in the best interests of getting himself re-elected. Similarly to Mr Howard, the Labor government recognised that we needed to act on climate change and, in doing so, could open ourselves to overseas engagement, especially with regard to exchanges in the renewable energy sector. Just because the senator and the majority of the coalition think that no-one else is, or was, doing anything towards climate change does not mean that we should sit back on our backsides and wait for it all to blow over—which is how the coalition would have it.
On the contrary, while we are abandoning our emissions reductions efforts, our partners in the region, namely, the United States and China, are increasing their efforts to cut their emissions. This month, the OECD released a report confirming that countries could achieve higher levels of emissions reductions at much lower cost if they relied on an emissions trading scheme. Emissions trading schemes are already being adopted in many countries around the world, including the UK, France, Germany, South Korea, Canada and, of course, parts of the US and China. This discounts Senator Macdonald's comments about Australia going at climate change alone and, if anything, the removal of a price on carbon without having an emissions trading scheme, that Australia not acting on climate change will make a difference on a global scale.
When he was Prime Minister, John Howard outlined as Liberal Party policy that he wanted Australia to be seen as instrumental in creating and participating in a carbon-trading hub in the Asia Pacific to work together as a region to reduce carbon emissions. Now we have a Prime Minister who is reducing our efforts completely by shutting down organisations that are making positive differences to our economy and, most importantly, to our environment. The government is making a mockery of the Australian people here. The coalition does not care. They think they can say anything in this debate and about climate change and that it will go unnoticed. They think that giving grants to businesses who sign up to their emissions reduction fund to encourage the use of renewable technology and the planting of trees at the cost of the CEFC will meet the emissions reduction target of five per cent by 2020. The government is yet to provide any information on what assistance will be provided to those businesses and industry groups who have gone into co-financing relationships with the CEFC. What will happen to these workers, their families and their projects once these measures have been removed? The government is going to make the people of Australia wait until the end of the year before they release their green paper on their policy.
Now I never thought that I would quote Senator Bernardi, but—and I must apologise—I am going to quote Senator Bernardi. I came across a paper that he wrote in April of 2007, titled 'Cool Heads Needed on Climate Change'. Despite the fact that he is openly a climate change denier, he had some pretty interesting things to say which I think should be included in the debate. He said:
The public needs to know where the propaganda ends and the reality begins.
Senator Bernardi's paper, 'Cool Heads Needed on Climate Change', 20 April 2007.
I would suggest that Senator Bernardi and the coalition take a leaf out of his book. The Australian people deserve more than the spin and the scare tactics from the government on this issue and, more importantly, they should be informed of the reality of the government's environmental policy platform and how it will affect them. He continues:
In reality, a genuine concern for mankind and the environment demands the inquiry, accuracy and scepticism that are intrinsic to authentic science. A public that is unaware of this is vulnerable to abuse.
So one minute the coalition do not believe in the science behind climate change, then we see that Senator Bernardi more or less labels the science that we on this side have accepted as not authentic. From this statement we clearly see that the coalition know that there is science there, but they choose to ignore it. He said that a public which does not know about the information and the science behind climate change is vulnerable to abuse. By not accepting the science and trying to shut down organisations that provide people with information about combatting climate change, the coalition is doing exactly that to the public, which he warned against.
The coalition would much rather no-one be informed about the issues which stem from not acting on climate change in the hope that if no-one talks about it, perhaps the issue will go away. The only thing that we do know for sure is that rather than listening to scientists, economists and leading business people about the importance of carbon pricing, that mob over there choose to develop a plan that would see an area the size of Tasmania planted with trees—hello, that was good timing, Senator Urquhart from Tasmania! That is their idea of direct action.
And of course we cannot let the actions of those concrete gnomes in the rockery over there, the Greens, go unnoticed in this whole debate. They carry the issue of climate change and global warming like it is their Holy Grail—like they are the only ones who can handle it or shape its path. If they really, truly, honestly believed that, they would have backed us in the debate about the emissions trading scheme in 2009 and not sided with their mates on the other side in trying to outdo each other for the political headline. That is exactly what they did. They can thank themselves for the position that we now find ourselves in. It is all well and good for the Greens to get up and talk about how much time has been wasted on these debates, but they are as guilty as anyone. In conclusion, Mr Acting Deputy President, I think that you can take it that there is no way that I will be supporting this bill or the related bills.
That was an outstanding contribution from my colleague Senator Sterle to the debate on the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and associated bills.
Today I rise as a senator from South Australia and, as such, I represent a state already bearing the brunt of climate change. South Australia's heatwaves this past summer made national and international headlines. In January, Adelaide experienced five days in a row with temperatures above 42 degrees Celsius. During that particular heatwave the mercury peaked at 45.1 degrees, just over 113 degrees on the old Fahrenheit scale.
Climatic conditions such as temperature are subject to natural variability. But beneath the natural variability there has clearly been a rising incidence of heatwaves in my home state. Between 1950 and 1980 Adelaide recorded an average of five days a year with heatwave conditions. By contrast, between 1981 and 2011, the number of heatwave days, on average, rose to nine days a year. That is almost double the number in the previous three decades.
There are those who argue that extreme weather like this is all due to normal variations in weather conditions. It is not. It is part of—
Senator Back interjecting—
I will take the interjection from Senator Back—yes, it is. He knows more than all the scientists at the Bureau of Meteorology and the CSIRO. Scientists around the world should bow at the feet of Senator Back, because he knows better! That is the problem with the government. They simply want to disregard the scientific findings, the findings of fact by good scientists, who have no political barrow to push but who want politicians to make the right decisions based on scientific facts.
There are those, like those opposite, who argue that extreme weather is all due to normal variations in weather conditions and part of a trend which cannot be explained by natural variability. I refer to the State of the climate 2014 report, produced by the CSIRO and the Bureau of Meteorology, released earlier this month:
Air and ocean temperatures across Australia are now, on average, almost a degree … warmer than they were in 1910, with most of the warming occurring since 1950. This warming has seen Australia experiencing more warm weather and extreme heat, and fewer cool extremes. There has been an increase in extreme fire weather, and a longer fire season, across large parts of Australia.
I have also heard some of those opposite suggest that the extreme cold weather experienced in this year's northern winter shows that climate change is not occurring. On the one hand, they argue that it is all natural variability and then, on the other hand, they try to argue that natural variability itself demonstrates something different to the long-term trend. The reality is this: scientists tell us that in recent decades near-record high temperatures have been occurring twice as often as near-record lows.
New records will be set for cold weather and will continue to be set. We will still have cold weather, but the trend of global warming will make record high temperatures increasingly common and record low temperatures increasingly rare. Of course, what is glossed over in all of this is the cost—the cost to our community, economy, health and us personally. People in South Australia are already being adversely affected by climate change and, if this challenge is not tackled, these impacts will become more severe. In particular, vulnerable elderly people will face health risks from heatwaves; farmers will experience declining rainfall and more frequent droughts; our wine industry will face more challenging conditions for grape growing; and of course the state's water supply infrastructure will come under great pressure.
Like all parents—and, I hope, all of us in this place— I think we should try to leave this world a better place for future generations. What is so upsetting about the approach taken by those opposite is that they are determined to ensure that our children and our grandchildren be the ones who will bear the consequences of climate change, because it is future generations who will bear the consequences of our decisions. The scientific evidence is clear: the world is on a path which will see substantial increases in temperatures by the middle of this century. Those higher temperatures will have significant environmental, economic, social and human impacts. To reduce these risks, the world needs to reduce the amount of greenhouse gases being emitted into the atmosphere from activities such as burning coal, oil and gas; industrial processes; and deforestation. It is a big challenge. But it is not a challenge which can continue to be kicked down the road for someone else to deal with.
This is an issue of fairness across generations. Interestingly, those opposite want to talk about intergenerational equity when it comes to public finance and national debt. Instead of invoking intergenerational equity to justify cuts for those who can least afford it, perhaps they should instead recognise that time is running out for tackling climate change for future generations. If we continue to refuse to take action what we will bequeath to our children is a world of rising temperatures; higher sea levels; acidified oceans; salinity and land degradation; and more frequent extreme weather events.
Our nation faces acute risks, including the loss of natural icons, such as the Great Barrier Reef; inundation of coastal property and infrastructure; and curtailment of agricultural production. It is not too late to manage these risks, but it requires urgent global action.
Governments around the world have set the goal of limiting the average global temperature rise to less than two degrees Celsius above pre-industrial levels. The science indicates that stabilising the atmospheric concentration of greenhouse gases at 450 parts per million gives us about a fifty-fifty chance of achieving that goal. To achieve just that requires substantial change across all countries, especially economies such as ours which rely heavily on burning fossil fuels to generate energy.
Those opposite will often argue that Australia cannot make a difference. It is a strange position for them to take because, in fact, the coalition have accepted the bipartisan target of reducing Australia's emissions by at least five per cent below 2000 levels by 2020. Australia is not going it alone in reducing emissions, and to say otherwise is a lie and should be called as such. Australia is one of 99 countries covering over 80 per cent of global emissions which have made formal pledges to the United Nations to reduce carbon pollution. We are also one of the largest per capita polluters in the world and one of the world's top 20 polluters in absolute terms. Our actions are globally significant and are watched closely by others. Free-riding is not an option.
The Abbott government's backtracking on climate change has been highlighted by the GLOBE Climate Legislation Study released in February—a study of 66 countries across the globe, including major emitters like the United States, the European Union, China, India and Brazil—and it found that we are the only country taking negative legislative action in climate policy. We need to play our part. We are a responsible global citizen. We are one of the world's largest emitters and we need to participate in the response.
As a member of the Labor Party, I am proud to have served in both the Rudd and Gillard governments, which acted on climate change. We are a party which has consistently placed long-term national interest ahead of short-term political interest on this difficult issue. In 1988, our commitment to tackle climate change was first included in our party platform. It was the Keating Labor government that ratified the United Nation's Framework Convention on Climate Change in 1992, and it was the Rudd Labor government that ratified the Kyoto protocol in 2007. It was Labor which introduced legislation for the Carbon Pollution Reduction Scheme—legislation blocked in this chamber by an unfortunate alliance between the coalition and the Greens. It was Labor which adopted an enhanced renewable energy target to ensure 20 per cent of Australia's energy comes from renewable sources by 2020. It was Labor which introduced a carbon price into the Australian economy from 1 July 2012, together with important other measures, to drive the transformation of our economy.
The fact is that a carbon price is the most environmentally effective and most economically efficient way of reducing greenhouse gas emissions. It harnesses the power of market forces to ensure emissions are reduced at the lowest cost to our economy, the lowest cost to taxpayers and the lowest cost to Australian consumers. That is why carbon pricing is supported by so many, the vast majority of economists and by every living former Liberal Party leader—whether by Malcolm Fraser; by John Hewson; by John Howard; even at one point by the Prime Minister, Mr Abbott, before he performed a disgraceful about-face on the issue; and of course by Mr Turnbull.
The carbon price has been in place for more than 18 months and it has had none of the dire consequences that the Prime Minister predicted in his deceitful scare campaign. Who can forget Senator Barnaby Joyce telling everybody in this nation that they would have $100 roasts? Who can forget the Prime Minister suggesting that Whyalla would be wiped off the map? None of this has come to pass. These were all lies told by those opposite in an attempt to drum up a fear campaign and a scare campaign.
The carbon price is working to reduce emissions. Emissions from our national electricity market fell by almost 12 million tonnes in the first year of carbon pricing and are continuing to fall. Emissions from electricity generation are continuing to fall. Households and businesses are using electricity more efficiently, and the electricity being supplied from the national grid is cleaner, with a larger share coming from natural gas, hydro-electricity and wind power. The carbon price, the RET, and the clean energy reforms are working to drive investment. We have seen wind power capacity treble and more than a million households have installed solar panels. As I have spoken about previously, we have seen the work of the Clean Energy Finance Corporation leveraging some $2.2 billion worth of investment in the clean energy sector.
We oppose these bills because they take a major step backwards on climate change. They are a message to the future saying, 'Too bad, it's your problem now and we don't care.' The bills will scrap important reforms which were working to reduce our emissions and transform our economy. Can I say this: politics at its best is a noble calling, but I believe these bills are the example of the worst of politics. They are the end point in a sorry story of cynical opportunism and irresponsible extremism.
It is worth recalling that in 2006 there was bipartisan support in this country for putting a price on carbon. There was support from both Labor and coalition for an emissions trading scheme as the cheapest, most efficient, most effective way of reducing our pollution. Eight years on and look where we are. We have a coalition government which has executed a backflip on its support for carbon pricing. We have a government which is ignoring advice—in fact, dismissing advice—from scientists, misleading the public, rejecting market mechanisms and embracing economic irrationalism. During the debate on these bills, we have heard those on the government benches attack Labor for introducing carbon pricing. What they have never explained is how it is they went to an election in 2007 promising to introduce it. When I served as minister for climate change in the Rudd government, I sought agreement on the CPRS, the Carbon Pollution Reduction Scheme, from the then opposition. I did so because I believed that such an important and long-term, whole-of-economy reform should have bipartisan support, and that should have been achievable, given the Liberal Party went into the 2007 election promising an emissions trading scheme.
I pay tribute to the then opposition leader, Mr Turnbull, because he played a constructive role. We negotiated sensible compromises which secured bipartisan support for the scheme. But then came the 'wrecker from Warringah'. Mr Abbott supported carbon pricing as a member of the Howard government. All through 2009 he supported Mr Turnbull's efforts to reach agreement on the CPRS. In November 2009 he said, 'You can't have a climate change policy without supporting this emissions trading scheme at this time.' But just four days later, he dumped his support for carbon pricing in return for the backing of the Liberal Party's hard Right to take over as Liberal leader. If there were an Australian Tea Party, the hardliners which took down Mr Turnbull over climate change would be its leading figures—and many of them are in this chamber. Mr Abbott's acolytes claim he is a conviction politician. Well, he is such a man of conviction that the instant he saw the opportunity to take power he performed an about-face on carbon pricing, not for any reason of principle, not for any reason of policy, not for any reason—
I am happy to argue that the Leader of the Opposition, as he then was, performed an about-face on principle and on policy in order to secure votes inside the Liberal Party room. If you want to pull me up on that, Mr Acting Deputy President, please do, because it is the truth. It was one of the most cynical manoeuvres in Australian political history—a senior frontbencher betrayed his leader, reneged on a bipartisan agreement, reversed his party's longstanding policy on a critical issue and then conducted a deceitful scare campaign because he was after the country's top—
Government senators interjecting—
I was actually concluding on that point, but thank you for emphasising it, Mr Acting Deputy President, because I think history will demonstrate what occurred. Mr Abbott's position changed because he understood the numbers inside the coalition party room. Others in the Liberal Party have commented many times on Mr Abbott's changeable position on this issue.
I would also reflect on the role of the Australians Greens. The reason the Senate did not pass the CPRS in 2009 was that the Greens voted with the coalition to block the legislation. We saw two coalition senators cross the floor to vote with the Australian Labor Party. I believe this was an instance of the perfect being the enemy of the good, because, if we had passed the legislation on that occasion, carbon pricing would have started in 2011; it would have been, by now, entrenched. This did not happen, because those in the Australian Greens refused to support a sensible carbon pricing scheme which got the balance right. Two years later, they did vote in favour of the Labor government's Clean Energy Future package, but I would make this point: there were substantial similarities between the Clean Energy Future package and the CPRS. One of the reasons given by the Australian Greens for voting against the CPRS in 2009 was that it provided free permits to the emissions-intensive trade-exposed industries and to coal fired electricity generation; so too did the Clean Energy Future package. They voted against the CPRS in 2009 because they wanted larger emissions reduction targets, but in 2011 they voted in favour of the Clean Energy Future package, which did not meet their demands on targets. What was lost was the opportunity for Australia to build a consensus on climate change, to make carbon pricing a lasting reform and to give community and business the certainty which is needed in this area of policy.
I think the result of the decisions of many people in this chamber—and, in most part, the decision of the opposition to go down the path of a disgraceful scare campaign—has been damage to community support for the principle of carbon pricing at key times. I think carbon pricing is an occasion where politicians should do the right thing not for short-term politics, not for political opportunism, but for the future generations of Australians.
In the time remaining for me to speak, I make two points. The government want to repeal carbon pricing before providing any details on how Direct Action will work. The reason they want to do that is that they know Direct Action will not work. It will not work. The repeal bills before the chamber will remove the caps on Australia's emissions, which are legislated under the Clean Energy Act, and what that will mean is that Direct Action has no way of ensuring Australia's emissions reduction targets are met and it will be less environmentally effective; and, rather than using the market to drive the cheapest cuts to emissions, the lowest cost to the economy, Direct Action will instead pay massive subsidies—taxpayer subsidies—to polluters. The age of entitlement has not ended when it comes to Australia's polluting industries. They are onto a whole new gravy train when it comes to entitlement, and that will cost taxpayers billions and billions of dollars. I refer to what former Treasury secretary Dr Ken Henry said last week:
If we are … going to commit to reducing Australia's carbon emissions below some business-as-usual baseline level ... then tackling that issue through any mechanism other than an emissions trading scheme will necessarily be more damaging on the Australian economy—
will necessarily be more damaging on the Australian economy. So those opposite, who claim they are the party of economic management, are introducing a policy that a well-respected former head of Treasury has said will necessarily inflict more damage on our economy, and they are doing so entirely for political reasons.
Labor are committed to tackling climate change in the most cost-effective way. We support moving from the fixed price on carbon to an emissions trading scheme from July this year—an emissions trading scheme that puts a cap on carbon pollution and lets business work out the cheapest way to reduce emissions. This is an important environmental reform, at the lowest cost to the economy, and is the policy we took to the last election. It is consistent with Labor policies on climate change for the last two decades and it reflects the fundamental values of the Australian Labor Party: our determination to protect the natural environment; our commitment to creating jobs and securing economic growth; and our pursuit of a fair society, including fairness across generations. For these reasons, Labor will seek to amend these bills in the committee stages and, if those amendments are not supported, we will oppose these bills.
In speaking on these 'clean energy' bills today, I commence with the stark contrast in the way Labor, as opposed to this government, is treating Australia's environment—a very stark contrast indeed. I want to put on record Labor's position on climate change, which, although it is well-known and will not come as a surprise to senators to hear, is that we accept, unlike many of those opposite—I will not say all—that the science surrounding climate change is compelling.
Let us just look at that basic issue for a moment. We accept the overwhelming view from the scientific community that climate change is happening. Over 97 per cent of published climate scientists agree that we need to do something about it, and the very difficult situation the Senate is in at the moment, as Senator Wong just highlighted, is that we have no idea what that something is. Indeed, we are progressing with these bills now, ahead of the Senate inquiry into this vacant Direct Action policy. The point about climate science is lost as we have this debate in the Senate and the wider community. Many people, because of the scare campaign highlighted by Senator Wong and for other reasons, believe there is an equally divided position among the experts out there, and there is not.
Labor took action, while in government, to address climate change. We put together a suite of climate change policies specifically to address how we manage Australia's emissions. That is what this government is dismantling. We created the Clean Energy Finance Corporation, which is doing a remarkable job in financing clean energy projects around the country. During estimates, we heard that the Clean Energy Finance Corporation's projects would account for 50 per cent of the target of reducing emissions by five per cent by 2020—at no cost.
I note that the Climate Change Authority, headed by Bernie Fraser, a former governor of the Reserve Bank of Australia, recently released the final version of its report, Reducing Australia's greenhouse gas emissions, which recommended that Australia increase its commitment to emission reductions—from five per cent to 15 per cent of 2000 levels by 2020. This makes the Clean Energy Finance Corporation's role in tacking climate change more important than ever. The government needs to provide a formal response to the Climate Change Authority's recommendations by May. It should make for interesting reading—how they intend to reach the target set out by the authority given the policy vacuum that currently exists.
Speaking of the Climate Change Authority, the government wanted to abolish this important independent authority too. The authority provides independent advice on climate change policies and by speaking with stakeholders and undertaking extensive research. There has been a concerted effort in recent times to present alternative arguments on climate change and sell them in the media as credible by claiming them to be from a significant number of experts. But this could not be further from the truth. The Climate Change Authority's approach is evidence based and fact based. It does not play the politics of fear and it does not play the politics of opportunism. Instead, it looks at the scientific and economic evidence available in order to come to conclusions and it makes recommendations to government and the parliament accordingly.
It is funny how the Conservative government in the UK are more in tune with climate change than their sister party in Australia, the Liberal Party. UK Prime Minister David Cameron said about climate change:
… I’m not a scientist but it’s always seemed to me one of the strongest arguments about climate change is, even if you’re only 90 per cent certain or 80 per cent certain or 70 per cent certain, if I said to you ‘There’s a 60 per cent chance your house might burn down; do you want to take out some insurance?’ You take out some insurance.
Boy, do we need insurance! But Prime Minister David Cameron and Prime Minister Tony Abbott are decades apart in their views on climate change.
I stress 'was'—
very much at the forefront, Australia was pioneering in this field and I would hope that it continues to be a pioneer. I do think that climate change issues and progress in that regard are critical and are not just fantasies, they are real issues.
What is extraordinary about this statement is that it comes from the International Monetary Fund, not generally regarded as progressing fantasies or radical views, and indeed from its head, Christine Lagarde, who is known to be a conservative politician.
What we are seeing around the world is conservative governments and organisations looking at the available climate change science and seeing for themselves that to do nothing significant is no longer an option. I use the word 'significant' because there is a difference between paying lip-service to the environment and the health of our environment, as this coalition government has done, and actually implementing policies which change the behaviour of polluters in the long run.
Under Labor, Australia's wind power capacity tripled and more than a million households had solar panels installed. Do you know how many solar panels were installed under the Howard government? Less than 7,500. Over 24,000 people are now employed in the renewable energy sector. Labor more than doubled the size of the renewable energy industry from what it was at the end of the Howard government. Let us hope this does not go backwards—that these jobs do not follow the same path as jobs in some other major sectors. As I said, Labor more than doubled the size of the renewable energy industry, a great example of how Labor creates jobs and will fight for existing jobs. What we have so far seen from this government is a lack of willingness to even save the jobs we have, let alone look at creating new renewable energy sector jobs. There is no doubting that Labor takes climate change and wider environmental concerns extremely seriously.
Another point we should remember is that Australia is surrounded by low-lying islands. Pacific islands are at risk of being obliterated if we do not do something to save them. How neighbourly are we as a country if we send the message to these countries that we just do not care? The total amount of pollution Australia emits puts us in the top 20 and we are the largest per capita polluter in the developed world. We cannot let the rest of the world continue to pass us. China has already started emissions-trading schemes in regions covering 200 million people.
Major world monetary organisations, such as the World Bank, the International Monetary Fund and the OECD, have all stated their preference for a carbon-pricing system in countries around the world. We are not talking about radical left-wing organisations here. These are conservative organisations which organise the world's finances—and they have taken note that to do nothing is not an option.
That brings me to the vacuous Direct Action Plan of the current government. It can be described as a number of thought bubbles—from the Emissions Reduction Fund to the Green Army—which have been thrown together. The Emissions Reduction Fund is using taxpayers' money to pay Australian companies to reduce pollution. The problem is that independent research has shown that the Emissions Reduction Fund will increase emissions by eight per cent to 10 per cent above 2000 levels by 2020. I will repeat that: it will increase emissions by eight per cent to 10 per cent. Many reports confirm that it simply will not achieve the minimum targets for pollution reduction by 2020 and is likely to cost many billions of dollars more than Tony Abbott has said. The Direct Action Plan has failed to attract any support from credible climate scientists or economists. The Direct Action Plan is inefficient and unfair. Labor is right to defend the climate change policies we introduced while in government or, if these bills are to proceed, to ask for a viable alternative.
In recent times, the coalition's views on climate change have publicly surfaced. We saw former Prime Minister John Howard tell an audience in London that those who accept that climate change is real are a bunch of religious zealots, and that he will trust his instinct rather than trust climate scientists. We saw Prime Minister Tony Abbott accuse the United Nations climate chief of 'talking through her hat'. And we saw Greg Hunt contradict the UN's climate chief's views using Wikipedia as his source—queried, indeed, as plagiarism. Let us remember that in a level of hypocrisy not seen for a long while the member for Sturt, Christopher Pyne, said the following in 2009 about an emissions trading scheme:
Let's not forget it was the Opposition that first proposed an emissions trading scheme when we were in government. The idea that somehow the Liberal Party is opposed to an emissions trading scheme is quite frankly ludicrous.
'Ludicrous,' said Christopher. Well, who looks ludicrous now! Now, I do not mind people changing their positions on issues where there is good cause, but the member for Sturt was so firm about his views. I wonder if he even voted for Tony Abbott when he challenged Malcolm Turnbull for the leadership back in December 2009. Was the change in leadership the reason for his monumental backflip?
At the 2007 election, both major political parties committed to an emissions trading scheme. It was accepted that something needed to be done and that the environment would not be used as a political football. But, my, how times have changed! The consensus that Senator Wong was referring to has been trashed, and it has been trashed by many—not all, but many—of those opposite. The old analogy that prevention is better than cure is appropriate in this debate, I think. It will be cheaper in the long run to act now rather than later. The previous Labor government showed strong leadership by introducing climate change policies, and they were—and, indeed, are still—working. We will not rubber stamp this government, and we will hold them to account.
In concluding, I would like to foreshadow that, after Senator Di Natale's second reading amendment has been dealt with, I will move a second reading amendment to add to the end of the motion that the Senate calls on the government to recognise the scientific expert consensus regarding climate change and that the repeal of the carbon tax must be accompanied by the introduction of serious and comprehensive policies to address climate change.
I would like to thank all those senators who have contributed to this extensive debate, which has been going for some months. Some people would even say that there has been a bit of a filibuster going on by people who still cannot accept that there was an election last year and that the Labor Party and the Greens lost and the coalition won. We have these election deniers over there who cannot get used to the fact that the Australian people have already debated the carbon tax imposed on them by the previous Labor government quite extensively over a very long time and that people decided on 7 September that they do not want Labor's carbon tax and they do not want higher electricity prices which come with Labor's carbon tax. The government is delivering on the commitments that we made to the Australian people at the last election.
Passing this carbon tax repeal legislation will help reduce the cost of electricity. It will help reduce the cost of gas. It will help reduce the cost of living. It will help reduce the cost of doing business in Australia. It will help to boost economic growth. And it will help create jobs, because not only is Labor's carbon tax bad for the economy but it does nothing whatsoever to help reduce global greenhouse gas emissions. All it does is shift emissions from Australia to other parts of the world, because Labor's carbon tax is helping overseas emitters take market share away from environmentally more efficient businesses here in Australia.
It is a bad tax. It is a tax which is bad for the economy. It is bad for families. It is bad for business, and it does nothing to help the environment. It does nothing to help reduce global greenhouse gas emissions. It is a terrible hoax that the Australian Labor Party has played on the Australian people. The Labor Party wants to force people to make a sacrifice for something that they think will make a difference when the Labor Party well knows that the carbon tax does not make any difference at all, and it is low-income earners who are hit particularly hard by the carbon tax.
This bill and the associated bills will boost Australia's economic growth, increase jobs and enhance Australia's international competitiveness by removing an unnecessary tax which hurts businesses and families. We have to remember: Labor imposed this carbon tax on Australian families and business at the worst possible time. As a nation we were already facing some challenges which came from tougher global economic conditions. Instead of making sure that Australian business could be as competitive as possible, instead of making sure that Australian businesses were able to employ more people, what did the Labor Party do? The Labor Party imposed additional costs, making it harder for business to employ people while not doing anything to help the environment.
A US congressman quite aptly described Labor's carbon tax as an act of unilateral economic self-harm. If at least it made a difference, you could have an argument. But it does not make a difference. Arguably, it actually makes the situation worse. For example, if the intent truly were to reduce global greenhouse gas emissions, we would have a conversation in Australia about how Australia can best help the world reduce those emissions. And guess what? It might well be that the best way we can help the world reduce emissions is by increasing emissions in Australia—for example, by producing more LNG which, when exported to China where it can displace coal as an energy source, would lead to significant net reductions in emissions. For every tonne of additional emissions from LNG production in Australia, we can save five to nine tonnes of emissions—that is, by displacing a high-emissions-intensive energy source with LNG.
The Labor Party completely ignored these realities. The Labor Party's carbon tax is making it harder for Australia to help the world reduce global greenhouse-gas emissions. The magnetite industry in the great state of Western Australia is emissions intensive, but it helps reduce emissions by so much through manufacturing in China. Magnetite as an input into steel production—if you look at the whole process, from the beginning to the end—helps reduce emissions by more than the additional emissions intensity here in Australia.
Of the top 20 carbon tax bills 16 have been sent to electricity companies, which shows that what we said all along was right: this is only an electricity tax. This is a tax paid by everyone. It is pushing up the cost of electricity for everyone. These electricity companies, which are being slugged by a total carbon tax bill of more than $3.5 billion, are passing those increased costs onto households and businesses. In New South Wales, Macquarie Generation and Delta Electricity are being slugged around $900 million. Victoria's power stations are being slugged over $1.3 billion. In Queensland, power stations are being slugged over $800 billion and in Western Australia the Electricity Generation Corporation is being slugged around $200 million. And it is increasing. Labor's electricity tax is then passed onto families, businesses, hospitals, schools, aged care facilities, local councils and sports and community organisations.
The government is committed to repealing the carbon tax and removing these costs from every Australian household's electricity bill. Treasury has estimated that repealing the carbon tax will lower retail electricity prices by around nine per cent and retail gas prices by around seven per cent compared to what they would have been with the carbon tax. Repealing the carbon tax will also help streamline business and administration costs. Repealing the carbon tax will reduce annual ongoing compliance costs for around 350 liable entities by around $90 million per annum. It will remove over 1,000 pages of primary and subordinate legislation. Lower costs of compliance will mean lower prices for businesses, which will mean lower prices for consumers.
The government is also abolishing the carbon tax because it does not actually work. It does not work because, at its heart, the carbon tax is an electricity tax. It relies upon the assumption that people will change their demand for electricity. The problem is that the demand for electricity is largely inelastic because it is an essential service. This means the carbon tax pushes up the cost of electricity without actually reducing emissions and, at best, it shifts emissions overseas. Production in Australia is now less competitive than in places like China that have not placed the same impost as the Labor Party's carbon tax. Competitors in other countries take market share away from us and take economic activity away from us. Jobs and emissions go overseas, where those emissions are arguably higher for the same amount of economic output than they are Australia. It just does not make sense.
Mindful of the time, these bills have been debated long enough. It would be good to put them to a vote before question time and, as such, I commend these bills to the Senate.
I move the second reading amendment that I foreshadowed in my speech in the second reading debate:
At the end of the motion, add:
"but the Senate calls on the Government to recognise the scientific expert consensus regarding climate change and that the repeal of the carbon tax must be accompanied by the introduction of serious and comprehensive policies to address climate change."
Of course everybody wants the scientific evidence base to be taken into account when dealing with climate policy. In the event that carbon pricing is repealed then of course there should be serious and comprehensive policy to address climate change. That is why this amendment is a bit of a nonsense. Everybody agrees with it.