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Wednesday, 22 August 2012
Page: 9562


Dr JENSEN (Tangney) (12:47): I am sure the member for Blair will be listening with interest. Let it be clear that the coalition is committed to a cleaner future. We have a holistic plan and a green army. The effect of the carbon tax is well documented and I will not dwell on that. This bill highlights the philosophical differences between the coalition and Labor. I will briefly touch on a number of issues with the bill and how shifting the philosophical paradigm could produce better results.

The ethos of this bill is regulation—regulation of bads, as opposed to incentivisation of goods. Regulatory approaches are slow, costly and ineffective. Incentivisation and market based policies work faster and more cheaply and are more sustainable. Think of a virtuous cycle. The literature on market theory and contestable markets would inform you of that. The member for Blair obviously was not quite so interested because he is leaving the chamber.

This GEMS bill is based on the need to comply with the UNFCCC guidelines. There are two issues here: (a) the premise is flawed, insofar as anthropogenic climate change is based on loose scientific ground and (b) even if the science is accepted then the targets are not realistic. Is a five per cent CO2 reduction from 2000 levels by 2020 and an 80 per cent reduction by 2050 realistic under the carbon tax? Luckily Labor does not work in business, because in business we talk about plans being SMART, where the 'R' stands for realistic.

The reality of the carbon tax is that carbon dioxide emissions will go up by 2020, from approximately 580 million tonnes per annum to about 630 million tonnes per annum. The way that you get the five per cent reduction is sophistry and spin, which has to do with the purchase of rubbish overseas carbon credits. So Australia will not be reducing its carbon dioxide footprint, regardless of what those on the benches opposite say. The reality is that global problems require global solutions, and there is simply nothing remotely approaching a global solution or a global view of the need to reduce CO2 emissions or indeed the mechanism by which you would do that.

As I have said, the principal reason for pursuing GEMS is deeply flawed. I take issue with the scientific sources cited in the bill. The reports referenced are from bodies with vested interests—for example, ClimateWorks Australia. These bodies are engaging in rent seeking behaviours in order to justify their existence and enlarge the money allocation for the next financial year. The objectives at hand include reducing CO2. I thought it was about reducing global average temperatures, but of course we dare not speak about that because the reality is that even if you accept the IPCC position you know for a fact that the effect is negligible to none. The other objectives are cleaning up the environment and making electrical products more energy efficient.

A better way is to reallocate the resources that would otherwise be used to regulate, distort markets and stunt imagineering. Why not reallocate that money and invest it in early intervention and R&D prizes—not programs but prizes to spur, not stunt, imagination? Put money into the cheap end of the innovation pipeline. Get rid of the fungibility issues and rent seeking behaviours dominant in the research industry. This mindset is losing the West our historic lead over China and other developing nations. Compliance does have a cost.

Small business cannot afford more green tape. This bill will affect all electrical products, insulation, energy, refrigerators—even cows. Labor do not stand for the working person any more. Why would they increase the price of everything, even of making a cup of tea—the cup, the water, the kettle? They are negative. They want to punish people. Labor do not trust or believe in the ingenuity of Australians to invent our way to a new tomorrow; the coalition is excited about the creativity of our people.

The bill makes reference to the 'reticence' of the government. They should be reticent, given their spectacular failures, such as the Home Insulation Program, the Green Loans Program, Green Start, school halls, set-top boxes and the NBN—I could go on all day. What makes them think that they can deliver now, when they could not deliver before? Moreover, seeking to harmonise state legislation—as this bill explicitly sets out to do—sounds good but in practice will have desultory results in the long run.

Vision is what the coalition is all about. The coalition believes in the fundamental brilliance of the competitive marketplace of ideas. This is true in the arena of legislation as well, where incremental amelioration must fight radical innovation. This creative destruction is the nature of capitalism. Innovative legislation breeds an innovative environment, and hence innovative products.

My strongest objection must come from the application of history and evidence. We know from the European Union and specifically the ECB that one-size-fits-all policy rarely works. The implications of unintended consequences can be seen today as a principal contributory factor to the depth of the financial crisis in the EU.

Optimal environmental outcomes require a policy that is flexible and that is tailored. What works in WA will not necessarily work in Victoria; what works in Victoria will not work in Queensland; and what works in Queensland will not work in Tasmania—but nothing works in Tasmania! Policy optimisation is contingent on local knowledge, flexibility, and case-specific environmental factors. The coalition is seriously concerned about the impact of green tape. It is having a real and measurable effect on small business, families and foreign direct investment decisions. That is why a living impact statement is required.

Like the government itself, this bill is tired and troubled. It means well, and perhaps that should be good enough, but when it comes to the future, and the future of our environment, good enough is never enough.