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Thursday, 11 October 2012
Page: 8011

Carbon Pricing


Senator BERNARDI (South Australia) (14:27): My question is to the Minister representing the Minister for Climate Change and Energy Efficiency, Senator Ludwig. I refer the minister to a joint press release issued by the Minister for Climate Change and Energy Efficiency, Mr Combet, and the Parliamentary Secretary for Climate Change and Energy Efficiency, Mr Dreyfus, last week asserting that the Regional Greenhouse Gas Initiative, an emissions trading scheme operating in 10 states in the north-east of the United States, was a great success because it led to a 23 per cent reduction in greenhouse gas emissions over the last three years. Can the minister confirm that the carbon price under that scheme in 10 US states has been below $2 a tonne since the scheme started in 2009, and that this US regional scheme specifically excludes manufacturers and other industrial plants from its application?

Further, is the minister aware that slowing economic growth and general weakening of the economy in the US has led to lower emissions without a massive price on carbon, as it did in Europe when industry shut down across Eastern Europe in the wake of the collapse of socialism?


Senator LUDWIG (QueenslandMinister for Agriculture, Fisheries and Forestry and Minister Assisting on Queensland Floods Recovery) (14:28): I thank Senator Cory Bernardi for his continued interest in the US. Can I say, I do not look like the US President. It is an area where—

Honourable senators interjecting

Senator Cormann: The note from Penny! Here we go! The Penny has dropped!

Senator Wong: I am just the postie!

Senator LUDWIG: Thank you. It is very difficult. I know they used to do it to Senator Wong; I am surprised they are doing it to me, too. It must be the topic that gets them excited. But let us be clear about this. In going to the range of areas that the opposition go to, they are trying to undermine the work we are doing in the Australian economy—not the US economy—

Senator Brandis: It is apparent surely to you, Mr President, that none of this answer is relevant even indirectly to the question asked.

The PRESIDENT: There is no point of order.

Honourable senators interjecting

Senator LUDWIG: I thank those opposite for trying not to interject. The commission looked at a report published by the Climate Commission that dispels once and for all the myths pushed by the opposition that Australia is acting alone. What Senator Cory Bernardi underpins his question with is that we are acting alone and we are not acting in unison with other countries. The commission concluded that every major economy is tackling climate change. It found that 90 countries representing 90 per cent of the global economy have committed to reduce their carbon pollution and have policies in place to achieve these reductions, and that many of these countries are relying on market based mechanisms. We have a fixed price for three years and then will move to a market based mechanism. The commission's report concluded that a carbon price is the most cost effective way to reduce emissions and is more efficient than other direct subsidy policies. That is why next year carbon trading will be operating at the subnational level in the United States. (Time expired)








Senator BERNARDI (South Australia) (14:31): Mr President, I have a supplementary question and I wonder if the minister can respond to it directly. Given that some states in the US were supposedly able to achieve a 23 per cent reduction in emissions with a $2 a tonne price on carbon, why is it that under Labor's $23 a tonne carbon tax, the biggest carbon tax in the world, domestic emissions are expected to increase from 578 million tonnes of carbon dioxide in 2010 to 621 million tonnes of carbon dioxide in 2020?

Honourable senators interjecting

The PRESIDENT: Order! I will give the minister the call when there is the appropriate silence.



Senator LUDWIG (QueenslandMinister for Agriculture, Fisheries and Forestry and Minister Assisting on Queensland Floods Recovery) (14:31): Again the question is not factually correct. It is very difficult, when they start off with an untruth, to deal with a question in a sensible way. If you look at the impact of the government's industry assistance, the majority of assistance comes through free permits which will move the price. We indicated in making this decision we would embark upon a process of consultation with the business community which we have done. Many concerns raised by business about the floor price but unheard of by those opposite are known about in the community. We have been cognisant of those concerns and we have responded to them. If you look at it in relation to—

Honourable senators interjecting

The PRESIDENT: Senator Ludwig, resume your seat. If people wish to discuss the issue and debate the issue, the time to do that is after question time. Senator Ludwig can continue.

Senator LUDWIG: What you find from those opposite is interjections which try to undermine—

Honourable senators interjecting

The PRESIDENT: Senator Ludwig, resume your seat. Order! I remind both sides. Senator Ludwig can continue.

Senator LUDWIG: What we can say is if you look at the assistance that we are providing to the industry, the way we are moving to an emissions trading scheme, it is far in advance of what the question suggests. This government are acting. (Time expired)






Senator BERNARDI (South Australia) (14:33): Mr President, I have a second supplementary question. Why does the Gillard government think it is appropriate that 23 million Australians are being asked to pay 20 times as much carbon tax than more than double that number of people across these 10 US states that I mentioned? Does the government really not understand that this is pushing up our cost of living and our cost of doing business by so much more than any other scheme around the world, including the one in the United States that I mentioned?


Senator LUDWIG (QueenslandMinister for Agriculture, Fisheries and Forestry and Minister Assisting on Queensland Floods Recovery) (14:34): What those opposite fail to appreciate is that to reduce carbon pollution and keep our economy strong in the future we need to make some changes in the way we do things. If we do not do this it will harm our economy, our prosperity and our environment. We are putting a price on the biggest polluters while we are helping households with any of the costs that are passed on with cash payments which have increased and benefits like the pension and tax cuts for workers, including tripling the tax-free threshold to $18,200. We have not been acting alone, as those opposite would have you believe. The ETS has been welcomed by the markets and the business community because of the certainty it will provide. The biggest risk is those opposite who would bring business uncertainty, reduce the opportunity for business and then provide a completely uncertain environment from which to operate. (Time expired)