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Thursday, 29 October 2009
Page: 11526

Mr ANDREWS (1:39 PM) —Let me pose a very simple question about Labor’s ETS, as it is outlined in the Carbon Pollution Reduction Scheme Bill 2009 [No. 2]. By how much will the price of this carton of milk increase once the ETS is introduced? Or another question: by how much will the price of this loaf of bread increase once Labor’s ETS is introduced? Let me give you the simple answer: nobody knows. The minister does not know. The government does not know. Indeed, I challenge them to come in here before the end of this debate and say what the increase in price will be for an ordinary, everyday staple—namely, a carton of milk—because of the ETS.

Let us take that carton of milk. It is estimated that the ETS will amount to a tax on every cow in Australia, because of emissions, of up to $75. That is a tax on the farming sector of this country of $2 billion a year. This will be reflected in prices. The respected financial commentator Terry McCrann estimates that the ETS is equivalent to initially raising the GST to 12½ per cent. But he warns:

… there is no … cap on this insidious version of a GST. The effective rate could double or triple, the amount of money raised could skyrocket. Indeed, it is intended to do exactly that, with no referral back to parliament for endorsement.

A brief to the Victorian Treasurer estimates that electricity costs in Victoria will increase between 26 and 46 per cent as a result of this ETS. And this increase in electricity costs will cascade through the entire economy, affecting almost everything that is produced. Indeed, the Rudd government has refused to release another report about the hike in electricity costs because of this legislation. The ETS is a massive tax hike that will be paid for by all Australians.

So a carton of milk will increase in price because of the tax on farming. It will increase in price because of the tax on electricity. It will increase in price because of the tax on transport. Simply having a dairy cow will be taxed. Using machinery to milk the cow will involve further tax. Refrigerating the milk will involve further tax because of the electricity it uses. Transporting the milk from the farm to the factory will involve further tax. The manufacture of milk products at the factory will involve further tax. The distribution of those products, whether it be the carton of milk or any other milk product, will involve further tax. And the government cannot tell us how much something simple that Australians buy everyday, such as a carton of milk, will increase in cost. Yet the estimates are that in the first year this will be like increasing the GST to 12½ per cent. I remind you that there is not a tax on many food products at the present time, but there will be under this new tax.

Worse than that, the ETS will destroy much of our competitive advantage as a nation. It is worthwhile remembering some sobering statistics about China, whose economy will not be subject to an ETS type tax. China’s reliance on coal as a primary source of energy is reflected in the fact that coal makes up 69 per cent of China’s total primary energy consumption. China has an average of two new coal fired power stations opening every week, with another 500 under construction. In 2007, China edged ahead of the United States as the world’s leading emitter of greenhouse pollution. If unabated by 2030, China’s emissions will grow by 139 per cent and make up 26 per cent, more than a quarter, of the world’s total emissions output. And China claims that it will be a developing country for at least the next 50 years and therefore will not agree to be subject to the Kyoto protocol.

Indeed, just last week India and China signed an agreement in New Delhi to collaborate on the development of renewable power projects and improved energy efficiency programs while rejecting any outside mandates that would slow the growth of both those nations. In other words, two of the world’s leading emitters have already said no to the Copenhagen proposals. So why on earth should Australia impose upon itself a job-and economy-destroying ETS when developing countries such as China will continue to grow and to pollute unabated?

None of this has been explained by Mr Rudd. Instead, he insists that Australia enact his job-destroying, high-taxing legislation before the rest of the world. He cannot even wait until December when the nations of the world meet in Copenhagen to discuss climate change. In July, the coalition issued nine principles about an ETS. In addition, we have repeatedly stressed that there should be no Australian legislation before the Copenhagen climate change conference, due as I said in less than two months time in December. In simple language: no legislation before Copenhagen and, relative to the rest of the world, no detriment to Australian industry and no loss of Australian jobs.

The Copenhagen conference, as I said, begins on 7 December, less than two months away. The US congress will not have enacted legislation before Copenhagen and neither will any major emitting nation. Despite this, Mr Rudd insists that Australia, with less than two per cent of the world’s emissions, legislates beforehand. Worse, the draft Copenhagen agreement envisions a massive transfer of moneys from countries like Australia to others. It envisages an international government of this new system. None of this has been discussed with the Australian people. And Mr Rudd cannot even tell us what the real cost to ordinary Australians will be on their ordinary everyday purchases and on their lives.

The reality is that Labor’s proposals will be a tax on everything. It will cascade through the tax system, adding a massive cost to business in this country and hence goods and services throughout Australia. It will make the GST look like a minor imposition by comparison. Mr Rudd’s tax on everything will cost us dearly. At the very least, we should not be enacting this legislation until after Copenhagen. When the Australian people realise the con that Mr Rudd is engaged in, their views will harden against this proposal. As I said, I challenge the minister before the end of this debate to tell the Australian people just how much this carton of milk will increase by because of his ETS.

The DEPUTY SPEAKER (Ms AE Burke)—The member knows that props, while sometimes assisting and tolerated, are not encouraged. He got good value from his milk carton.