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Wednesday, 30 May 2012
Page: 6267


WYATT ROY (Longman) (13:22): I acknowledge the member for Dawson and his eloquent and common-sense approach to this bill. I also rise to speak to the Clean Energy Finance Corporation Bill 2012, the Clean Energy Legislation Amendment Bill 2012 and related bills. Every day I am stopped in the street by people in my electorate—small business owners, teachers, parents, independent retirees, single mothers. All of them want to know a simple thing. They want to know why this Labor government seems to be doing everything in its power to make their lives more difficult. They want to know why this Labor government is making decisions that are causing their bills to be higher and the cost of essential everyday items to be more. I speak to families who are facing escalating cost-of-living pressures simply because of the poor fiscal management of, and the bad decisions made by, this Labor government. There is no secret in their minds. They know that their costs are going up because of this Labor government—a government that is plagued by waste and mismanagement. They know that this Labor government has shown itself to be unable to successfully implement any program it puts its hand to or to avoid massive cost blowouts in its failed schemes. The people I speak to have had enough. They want to know when the waste and mismanagement will stop. Unfortunately, I have no confidence, and those opposite have given us no hope, that government waste and mismanagement will ever stop while we are under this Labor government.

We are in this place today to debate a bill proposed by those opposite that is designed to make this situation even worse for Australians. It is a bill that will glorify waste and glorify mismanagement. It will give the cold shoulder to responsible fiscal administration. We are here to debate a bill that has the fundamental promise of sinking $10 billion of taxpayers' money into a massive black hole. Let me just say that again so that we can feel the full impact of what this bill proposes. This bill will flush $10 billion down the drain. That is $2 billion every year for five years, starting on 1 July 2013.

The Clean Energy Finance Corporation Bill 2012 establishes the Clean Energy Finance Corporation that will have the power to invest in the development of low-emission technologies and energy efficient projects that the private sector will not touch. The goal behind this bill is a farce. The premise is that this bill will ultimately increase the amount of renewable energies that make up Australia's energy sources, that there will be better renewable energy options, that there will be more money going into renewable energy research and that somehow this will create better technology. But this premise is fundamentally flawed.

Bipartisan support exists in this parliament for a total of 20 per cent of all Australian energy to come from renewable energy by the year 2020. This is a target that the industry is already working towards. This bill will not increase this target; in fact, this bill pours money into something that will feasibly be achieved by the market without the interference of a government entity such as the Clean Energy Finance Corporation. It is the renewable energy target of 20 per cent that is driving private market investment in the energy sector.

This bill will have no positive impact on this target whatsoever. There will be no new renewable energy generated as a resulted of this bill. Currently the market has been a very effective driver behind the development of renewable energy sources, and now this Labor government is, once again, seeking to meddle. This government is attempting to interfere in the form of a bill that installs an entity charged with the challenge of seeking out technologies that the market has already rejected—the technologies that the market considers to be unproven, too speculative or too risky for commercial financing.

This bill's sole purpose is to seek out those that were the last ones picked on the team, the proverbial pariahs of the renewable energy market, and put them in pole position for the renewable energies race. Not only will the government be effectively backing the losers, it will also adversely affect those existing, commercially-viable investments. What this will be is a subsidy for projects that the private sector will not touch because there is no security and the cost-benefit ratio is not economically sound.

If the market has determined that a technology is unviable then throwing more taxpayers' money at it is not going to help the situation. Throwing more money at it only hurts projects that are viable, that have potential and that already have the support of the market. It discourages, rather than encourages, future investment in the industry. Savvy private investors are not going to put their money into projects that, as a result of this bill, will be at a distinct disadvantage.

Under the framework outlined in this bill, the minister will be responsible for issuing an investment mandate for the Clean Energy Finance Corporation, and the criteria for investment selection and suitability will be determined by the minister and the government of the day, providing the government with what is effectively control over the renewable energies industry.

At what point did governments cast aside their responsibility to spend taxpayers' money more efficiently and wisely? At what point did it become acceptable for a government to choose to believe that it has a right to waste taxpayers' money—to waste money on schemes that not only will not provide a return for the community but actually damage existing commercial industries? As I have said in this place before, it is up to governments, just as it is up to the responsibility of individuals, families and corporations, to live within their budgets and to make wise financial decisions. This is not what we have seen or what we are seeing with this Labor government.

This Labor government has thrown responsible, logical and sensible financial management out the window. We are seeing with the Clean Energy Finance Corporation Bill 2012 that this government wants to mandate that the entity it is creating needs to actually seek out irresponsible investments to pour Australian taxpayers' money into. It is trying to engage in speculative share buying that the market does not support. It is a high-risk move; a significant risk taken with taxpayers' money. In fact, those opposite are not even trying to pretend that this bill will pay off. Their own explanatory memorandum for this bill reads:

The fiscal and underlying cash balance impacts include a prudent recognition that some investments will not be recovered, and interest revenue.

Those opposite are predicting that 7.5 per cent of the $10 billion to be injected into the renewable energy sector is expected not to be recovered. That is $150 million each year for five years, equalling a total of $750 million. Unfortunately, with this Labor government's record on program blow-outs as well as debt and deficit, there is absolutely no certainty that this government could keep it at this level.

It is almost as if this government is seeking out more ways to waste taxpayers' money on failed quasi-environmental programs and increase the debt burden for the next generation of Australians. We have seen pink batts, green loans, Green Start and cash for clunkers, not to mention school hall rip-offs, set-top box cost blow-outs, the debacles of the East Timor and Malaysia solutions, the live cattle export catastrophe and a failed class war. This list goes on, and this government is determined not to learn its lessons.

This government is also determined not to learn the lessons of our friends who have tried and failed in similar programs. Whether it is the United States' Solyndra project, which alone cost $700 million, or Beacon Power, Enerl or even the Solar Trust of America, all of these catastrophes occurred under programs similar to the Clean Energy Finance Corporation and all were massive economic failures. Where others have gone and failed and will not go again, this government is blindly forging ahead.

On our own home soil we have witnessed the devastating failure of the Victorian Economic Development Corporation, which shared many of the hallmarks of the Clean Energy Finance Corporation. This should be a wake-up call for a government that has no intuition. But in the same way that this government disregards the views of Australians, it is dismissing what the market is saying about these technologies and stubbornly ignoring expert advice. Industry experts have offered a clear warning about interfering in the market process. In addition to clear advice against embarking on such endeavours, the industry also categorically rejected the Queensland Solar Dawn project and the Moree Solar Project. And with the help of the former Queensland Labor government, this Labor government has itself stacked up more than $100 million of losses on the failed ZeroGen project. With failures already under its belt, it is beyond comprehension why this government is ready and willing to put itself on the chopping block for yet another failure.

With such compelling evidence against interference in this industry and with demonstrated, proven examples of how pursuing the Clean Energy Finance Corporation and its investments into renewable energy is simply disrespectful of the Australian public, pursuing this activity under these circumstances is nothing more than a flagrant disregard for the hard earned dollars of the people in my local community and in every other electorate in Australia.

If it is not bad enough to be pursuing a project that experts, evidence and prior experience reject, it appears that those opposite are determined to do everything they can to shut the Australian people out of having any say on the Clean Energy Finance Corporation. The government is attempting to push through this legislation without the time for scrutiny by the Australian people, as well as funding the corporation upfront so that the money cannot be withdrawn when the people have their say—and, inevitably, they will say no to this scheme. It is my firm belief that we are here in this place to represent the views of the people, not to exclude them from decision making about the future of our nation.

Senator Milne, the Leader of the Greens, would appear to be proud of these attempts to subvert the say of the Australian people and is even on the record as saying, 'With a legislatively guaranteed stream of funding outside the budget, no future government will be able to undermine it without changing the legislation.' It was interesting to hear what political and economic commentator Ross Greenwood had to say about this initiative. 'Frankly,' he said, 'if they have been rejected by the market in the first place they are going to be rejected by them in the second place also.'

Blind Freddy could see that this decision has no positive impact on the environment or on developing sustainable renewable energy alternatives. If the Labor Party and the Greens truly wanted to achieve these goals, they would have been better off giving tax incentives to private investors for them to invest in speculative energy companies. This would have been a far more mature and logical approach to developing this sector. Such an approach would have ensured that taxpayers' money would not be used to take on the risk of initiatives that the private sector will not touch. Such an approach would have been a far more responsible management of taxpayers' money. The point remains that for all the money spent and the effort and the time that go into this scheme, Australians will see no benefit for the environment. The point remains that the bipartisan supported target of 20 per cent by 2020 will not be positively impacted on as a result of this bill.

As long as I am elected to represent my community in this place, I will fight to defend their fair expectation that their hard earned taxpayer dollars are spent appropriately. This bill is just another tragic example of this Labor government wasting taxpayers' money. It is waste that I do not condone. For the reasons I have outlined I strongly oppose this bill.

Debate adjourned.