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Tuesday, 31 May 2011
Page: 5404

Mr FITZGIBBON (HunterChief Government Whip) (17:41): We will have an opportunity to speak in much more detail at a later date but I feel one cannot make a contribution in this place on this day without making at least a reference to Lieutenant Marcus Case and Lance Corporal Andrew Jones, who have both just lost their lives in Afghanistan, making them 25 and 26 amongst our casualties and many more who are injured. Our thoughts and prayers go out to their families, loved ones, mates and friends.

For the record I restate my support for our ongoing involvement in Afghanistan. It is important to our own national interest. It is dangerous and challenging work, particularly mentoring the Afghan National Army. We do not know the detail, but it seems apparent that Lance Corporal Jones lost his life at the hand of an Afghan National Army soldier. I have had my own experiences with members of the ANA. The majority of them I believe are there for the right reason and doing their very best to train themselves and to be trained where they need to be to take care of their own security in Oruzgan province.

On that point, I noted some comments by Colonel John Angevine in the Sydney Morning Herald today, which I will also have something more to say about at a later date—his suggestion which he will put in a speech to the Lowy Institute tomorrow that Australia's strategic settings are incorrect and based on the wrong premise. I disagree with Colonel Angevine. It is right for Australia to make as its first priority the defence of our continent and our areas of strategic military interests and to do our best to be able to do so independently of any other nation state. We do not know where the United States will be in global terms in the future. We can never be certain that the United States will not turn inward. We cannot always be absolutely sure that the US will be there for us, as confident as we can be at this point in time, and we might be talking 100 years from now. For Australia to have the ability to establish self-reliance, we need to have continuity in our defence planning and continuity in our investment in defence capability—continuity which would be lost if we took a different strategic setting.

Before I turn to some of the details of the budget, I have something to say about what is I suppose the topic of the day, although it is competing on many other fronts this evening, and that is climate change on this day of the delivery of Professor Garnaut's latest report. I want to share a bit of a narrative to make my point. Mick is a plumber. Throughout his working week he generates a fair bit of waste. He disposes of it at the local council-run garbage tip where he pays around $20 a tonne. He cannot simply pass the whole cost of dumping his waste onto his customers. The industry he works in is just too competitive. Peter owns and operates a factory producing chemicals. One of his biggest costs is the safe and responsible disposal of his toxic waste. Like Mick, Pete struggles to recover these costs in a competitive market. Judy and Ben both work to support their young family. Their household budget sets aside about $30 each week to cover their council rates. Ten per cent of that cost represents the amount the local council charges to dispose of the family's waste. They have a big garden and, while Ben puts all he can into compost, he regularly takes a load of waste to the council tip in his box trailer. Each time he does so he faces a minimum fee of $15. By contrast those who make a quid generating the electricity which powers our homes, our factories and our small businesses dispose of their waste free of charge. On a daily basis they emit tonnes of pollution into the atmosphere. If you and I did that, Mr Deputy Speaker, we would be fined.

There are many reasons this is unacceptable—some are environmental, some are economic. The environmental concerns are obvious and the economic ones are less so. When we allow one set of industries to avoid some of the costs of doing business we distort the market and disadvantage others. We also affect business investment decisions. People have asked me: 'How is imposing a carbon price on big business and then compensating consumers going to change consumer behaviour?' There are two answers to that question. It is not primarily consumer behaviour we are trying to change. Rather we are mainly trying to change the behaviour of investors. At the moment investment in renewable forms of electricity generation or less-polluting forms of generation like gas are relatively expensive. One reason is that coal is relatively cheap. The second reason is that the cost of disposing the rubbish, that is pushing pollution into the atmosphere including carbon dioxide, is zero.

This is the key distortion I referred to earlier. Making the producers of electricity pay to pump their pollution into the atmosphere will help to level the playing field. The price they charge for their product will better reflect the cost of producing it. This will make renewables more competitive and, in turn, the renewable sector will attract greater investment and therefore will grow.

That is not to say that we do not hope to influence consumer behaviour. Let us say a family was to receive $100 compensation for an increase of $100 in the price of their electricity bill. If that family, in turn, work to reduce their consumption of electricity to the point that the impact of the carbon price only sent power prices up by $80, then the family would profit to the tune of $20. This is a significant incentive for them to embrace the cause of energy efficiency and other means of reducing their power consumption.

Even if you are a climate change sceptic, you need to ask yourself two things. Firstly, given it will be cheaper to act now rather than later, wouldn't it be smart to act now as a form of insurance? Secondly, why should Mick, Peter, Judy and Ben pay while the big polluters escape cost free? These are important points. The debate about carbon pricing is a very, very complex one but at the end of the day it is really simple. There is an abundance of science to suggest that the climate is warming and that man is making a contribution. But, again, if you only take the precautionary principle and accept that at the moment the market is distorted and we need a structural shift in our economy, then you will support some action on climate change. If you are going to support action you would support a market based mechanism which, of course, is the cheapest and most efficient way of doing so.

I now turn to Appropriation Bill (No. 1) 2011-2012. The budget was a good budget. I think it was a historic budget. Its key focus was getting the government's books back into the black after a very significant investment, which was absolutely necessary to keep this Australian economy out of recession. It did so very successfully. We are the envy of the world. It sought to spread the dividend of the mining boom, which is very important to people in my electorate. A very big investment in health continues. I am sure it is right up the top of the agenda for most Australians.

Very close to my heart is a big investment in employment—in other words, a big investment in assisting people getting back into the labour market and the workforce, through adopting both carrot and stick approaches. That is a big investment in those who need a leg-up to secure some involvement in the labour force. Appropriate changes to the transfer payment system have been made to ensure that people who are able to work are in the workforce. We cannot afford to do anything but that. An unemployment rate below five per cent demands that every working aged person in this country able to work is working. If we fail to do that not only will we face higher rates of inflation and therefore higher interest rates but we will also be missing a once-in-a-generation opportunity to break the cycle of poverty and the cycle of unemployment.

In my electorate we have too many people on disability support pensions who I believe could be working and there are too many sole parents not working who could be working. I have many young people in my electorate who are third generation unemployed—in other words, they have never known either their parents or their grandparents to work. At the same time I have employers—particularly those in the wine tourism industry or in local pubs or clubs or in other semiskilled areas of work—who cannot get young people to fill positions. That is something we cannot allow to continue into the future. I am working with my local employment coordinator and other stakeholders to ensure that the initiatives in the budget are used in a way which maximises the benefits to my constituency. This more than anything else is about protecting the economy and it is about the dignity of work.

One of the controversies I have seen in recent times—and it is nothing new of course—is the effect on contractors when head contractors or the primes in a build or project collapse are unable to pay their bills. There have been a few examples such as in the Building the Education Revolution. Some members in this place have tried to some make political capital out of that as if, because the government is the funder, somehow it is more responsible than the private sector might be in a similar situation.

I do think there is an opportunity for government that is not necessarily available to the private sector. That idea was put forward to me by Mike Bell, who is Sydney based. He wrote to both me and the Attorney-General. I have since written to the Minister for Finance and Deregulation, Senator Wong. He put forward the idea of rather than paying the prime contractors in a build—let us say, it is a school or a significant residential accommodation facility on a defence base—putting part of the money into a trust to ensure that the contractors under the prime contractor are eventually paid. I think it is a good idea. I have written to the finance minister and said so. I appeal to her and other senior economic ministers to have a look at the merits of the system as a means of protecting small to medium businesses which might be working under very big prime contractors and which are vulnerable to the consequences of the collapse of larger contractors.

I want to quickly say that I am, again, concerned about the behaviour of some of the Australian Rail Track Corporation's agents in the build of the third rail line through the Hunter down to the Port of Newcastle. This is going to be a dedicated line, making the transport of our coal to ports quicker, more efficient and further enhancing the capacity. However, these works—which I welcome so much—involve land acquisitions and other problems for residents nearby. I experienced another one recently where an overpass is going to affect the access to a person's land. I have written to the minister about it and am hoping that it will be resolved, and I warn the agents of the ARTC—that is, those contracted to the ARTC—that I and, I am sure, my constituents expect them to act as the equivalent of model litigants in these cases, to treat people with respect and to ensure that they get compensation commensurate with the way they have been impacted upon as a result of the building of that rail line.

I close by doing what I so often do—that is, to welcome the ongoing funding in the budget for the Hunter Expressway. This is a $1.7 billion project in my electorate which is going to transform land transport in the valley. I have been fighting for it since, would you believe, about Easter 1988. Some people might describe me as a failure for taking so long, but we got there, and it is going to be a big boost to the Hunter economy. I put the RTA on notice that I intend talking to them very soon about some additional works associated with the project—simple things such as artworks along the highway and proper signage which points out and highlights the attractions of the valley. I think people are going to need a bit of a push. I am appreciative of the efforts of a member of the local chamber of commerce who put together some very good ideas on the subject which I will be putting to the minister. (Time expired)