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Tuesday, 2 June 2009
Page: 5299


Mr HUNT (10:22 PM) —As somebody who believes in the great challenge of climate change, as somebody who has worked in this space for many years and as somebody who comes to this chamber and this parliament with a belief that we need global action, I find the Carbon Pollution Reduction Scheme Bill 2009 profoundly disappointing. I find it disappointing because it achieves a unique double. That double is that it sends global emissions up by sending our emissions to higher emitting environments—whether they are China, India, the Philippines or Indonesia—through the process known as carbon leakage. This is recognised throughout the world. At the same time, it is also sending global emissions up by sending jobs overseas, where there is no level playing field. It manages to destroy Australian jobs. As somebody who cares, as somebody who believes and as somebody who is passionate about the actions that we need to take to reduce global emissions, I find that this bill has a unique double. It sends emissions overseas—whether it is zinc, aluminium or even such things as cement or waste paper processing—to China, to India, to the Philippines and to Indonesia. Secondly, in so doing, it sends Australian jobs overseas and it takes down Australian employment. That is a unique combination for a bill which should be a point of hope, opportunity and a step forward. That is why, at this point in time and in this format, it is simply not acceptable, and I say that as somebody who wants a solution and who believes in a solution.

Let me make these points today. I deal, firstly, with the false dichotomy of the myth of action versus inaction put forward by the members of the government; secondly, with the reality of what we are proposing; thirdly, with the global reality; and, fourthly, with the fundamental flaws in this bill as it stands. At the heart of those fundamental flaws is the problem that the lack of a level playing field for Australia and Australian business will send emissions offshore. Zinc, aluminium, concrete, cement, waste paper and so many other sectors want to do the right thing but cannot compete in a world where they have both hands tied behind their back and their competitors do not.

Let me deal firstly with this notion of the myth of inaction. What we saw under the previous government was something quite remarkable. In a world with 40 billion tonnes of CO2, Australia, at approximately 560 million tonnes or 1.4 per cent of global emissions, was one of only five or six nations in the developed world to actually meet its targets. We were given to believe that we were somehow a pariah, yet it was Australia—not Spain, Japan, Canada, New Zealand or the United States—which was actually meeting its targets. The only thing that the atmosphere knows, the only thing that the planet knows, is what level of CO2 in parts per million is actually emitted by a country. That is all that the atmosphere knows; yet under the previous government Australia was one of a handful of countries to meet its international commitments. If you want a test of action, it is who lived up to their obligations—not who promised but who lived up to their obligations.

That brings us to what we propose. We propose four simple measures to make real reductions, to take real steps and to take real action to deal with this problem. Firstly, we have said that we will deal with targets of 25 per cent if there is a comprehensive global agreement, 15 per cent if it is between 510 and 540 parts per million as an outcome from Copenhagen or five per cent if we have to go it alone. But we contemplate all of those actions. We give bipartisan support so that the government may go in good faith to negotiate with the rest of the world and cannot use the issue of targets as an excuse for domestic political confrontation.

Secondly, we have said that we would immediately set up a voluntary carbon scheme on 1 January 2010. We would set up a scheme which would allow for bankable credits to be created, which means they could be tendered against any future carbon price. This means that BHP, Rio or Alumina—it does not matter what the company is—has a real and tangible incentive to begin action now; not in two years or 2½ years under the government’s scheme but to begin action now. In addition, the voluntary carbon scheme would also allow for voluntary action to be credited over and above whatever targets we agree to in Copenhagen. In other words, if you take voluntary action, if you are a mum or dad who does something, under the government’s scheme it will not be counted but under ours it would be in addition to the national target. Thirdly, we will embark upon a clean energy revolution. We have already said that we will put in place a solar continent vision, underpinned by what we do domestically in schools, communities, and also with base load solar. There is much more to come on that front. Fourthly, we have said that if there is a level playing field there is a fundamental role for a price on carbon. If there is no level playing field, then what will occur is very simple—there will be carbon leakage.

The next thing that I want to address is the international environment. The international environment is a simple concept. There are two fundamental steps that will occur over the next six months. There is the Copenhagen conference, and the Copenhagen conference, as the Danish climate change minister, Connie Hedegaard, has said to me and to the member for Goldstein, is about targets, targets, targets—‘We want to know what your targets are.’ We have said 25 per cent if there is a global agreement, 15 per cent if it is between 510 and 540 parts per million or five per cent against our 2000 emissions if there is no agreement whatsoever. That is our unilateral commitment.

Yet there is a second key element, and that is the United States. What is it that the Obama plan proposes? It differs from the Australian scheme in five key ways. Firstly, it offers 100 per cent coverage for those sectors which fall within it on not just their direct but also their indirect costs. Secondly, it excludes agriculture on a compulsory basis but includes agriculture on an offset basis. In other words agriculture can be used to make the great green carbon savings which we propose. Thirdly, coal is out. Fourthly, 30 per cent of permits go to the electricity sector. We know that the electricity sector in Australia is about to face a balance sheet crisis. In other words it has not been dealt with properly under the current system, and that is a fundamental difference. Fifthly, the export sector in the United States is approximately half the percentage of the economy which it is in Australia, and if you exclude elaborately transformed goods or if you look solely at the commodities sector, the commodities sector in the US is a significantly lesser part than it is in Australia. What that means is that those sectors are better treated.

There is no level playing field between the US and Australia, and as we go towards Copenhagen we see this simple principle. What occurs in the US will have an impact on Canada, will have an impact on what occurs in New Zealand and will have an impact on what occurs most fundamentally in Europe. Copenhagen and the United States will coalesce. The systems will harmonise, and we seek simply to make the point that we must coalesce with the US system if we are to have a real impact on emissions and if we are to protect Australian jobs from the task of losing a level playing field.

Against that background fundamental flaws exist in this bill. Firstly, it does not provide business with certainty. Under any scenario there are three completely different outcomes—a five per cent, a 15 per cent or a 25 per cent scenario. The bill cannot give that certainty. Secondly, the regulations do not exist. Sixty industries? How many have we seen? How many will we see? We will be making fundamental changes not through legislation but through unseen regulation which affects people’s rights and which affects people’s jobs. Whether you are in Gladstone, Mackay or Rockhampton, whether you are in New South Wales, Victoria, South Australia, Western Australia or Tasmania, your lives will be changed by regulations which may be disallowable but which are never brought before the parliament for fundamental debate.

Then we see that this lack of a level playing field applies to everything: zinc, aluminium, steel—any processing of commodities in Australia. LNG is likely to stop investing in Australia and we will simply see that China and Indonesia will develop coal resources, and not only will Australia lose the investment but the world will use a fuel which is three times the CO2. That is not good; that is not right. That is not what should be occurring.

We see another simple flaw. Firstly, there is no certainty under what the government proposes. Secondly, it is out of sync with the United States. Thirdly, there is no level playing field. Fourthly, from something as simple as the waste coal ine gas sector 85 million tonnes of CO2 could be saved between now and 2020. Under the Rudd scheme, under the government’s scheme, what we will see is 85 million tonnes of CO2 released because the standards that are in place in the US and in Germany are not in place in Australia.

For all of these reasons, because this bill achieves a unique double, because it achieves the double of sending up global emissions and of sending Australian jobs overseas, it fails in its fundamental purpose. For these reasons we have moved that it be delayed and deferred until after the United States and Copenhagen outcomes are known. I support the amendments proposed by the Leader of the Opposition, and I express the deep reservation that these bills will simply send global emissions up.

Debate (on motion by Mr Gray) adjourned.