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Wednesday, 10 October 2012
Page: 11914


Mr BALDWIN (Paterson) (20:29): The contribution by the member for Reid fits in perfectly with the mantra chant from all of those from the government benches. They like to use the word 'fact' regularly. Mr Deputy Speaker Leigh, I would say to you that there are facts, statistics and more mendacious statements coming from this government each and every day in relation to this carbon tax. This carbon tax is a $9 billion-a-year tax from which there is no escape. In the first four years some $36 billion will be collected. Contrary to what the member for Reid and others have said, despite this carbon tax, Australia's emissions will actually increase from 578 million tonnes in 2010 to 621 million tonnes by 2020. That is because electricity and gas are essential services. Instead of reducing Australia's emissions, firms will have to purchase 94 million tonnes of carbon permits overseas by 2020. A great deal of effect that is going to have for our local environment!

I quite often hear members opposite saying that there is no impact or only marginal impact on businesses. I am going to give some real life examples from businesses in and around my region and my portfolio. On 2 October Tony Abbott and I made a visit to the Weathertex plant at Tomago to inspect one of the oldest continuous employers in the region. It used to be called the Masonite factory but now produces Weathertex boards for both the domestic and international markets. Paul Michael, the Managing Director and CEO, has grasped an old business and reinvented it through putting in massive investment. Today it employs around 100 locals and generates $23 million in domestic sales and $2 million in exports. Paul Michael indicated that, even though the business has a negative carbon footprint, they are being slugged with a half a million dollar carbon tax bill across their coal, gas and electricity. He said:

We were a reasonably profitable business and now we are not quite so profitable, which is not going to help us expand and develop new products because of the carbon tax.

What Labor does not understand is that many businesses like Weathertex are competing in price sensitive markets. Any increases in production costs will make them less competitive, which will mean fewer sales and therefore cost Australian jobs. What was it that Greg Combet, the Minister for Climate Change and Energy Efficiency, who is the real master of mendaciousness, replied? He said:

Businesses in the Hunter are generally doing quite well. They are able to pass on the modest cost increases from the carbon price in their prices.

I say this to the master of mendaciousness: if he thinks that half a million dollars for a small business that employs 100 people is a modest cost increase, then I would ask what he considers to be a large increase? I would suggest that the minister starts talking to local businesses and families, because I can tell you that many of them are doing it tough. As for Weathertex's export business, this government has put a reverse tariff on with their carbon tax.

The story goes from bad to worse. In my electorate the largest dairy is owned by Dallas Clarke and is based at Wallalong. This week he announced to all his staff that he is closing his 700-head dairy at the end of November as he cannot afford to continue to operate. There were two factors: No. 1 was the low cost of milk in the supermarkets, and the straw that broke the camel's back was the increase in electricity costs. Dallas took advantage of dairy deregulation knowing that he had to increase his herd size to get critical mass and ability to amortise his costs. He invested millions of dollars to make sure that he survived. As I said, the carbon tax is the straw that broke the camel's back. Just the carbon tax increases alone in his electricity bill were $609 in July and $600 in August, and that is not to mention the increases in the off-peak rates that have risen out of all proportion. Those that know something about the dairy industry know that they milk during the off-peak rate period. His power bills have gone up from $4,850 a month to $6,000 a month making his business unsustainable. His milk prices have dropped to around 45c per litre yet his electricity prices have increased out of sight.

I am led to believe by the dairy industry that others in the industry are in the same position and are looking at closure. Yet, again, what has the master for mendaciousness said to these business operators? He said:

Businesses in the Hunter are generally doing quite well. They are able to pass on the modest cost increases from the carbon price in their prices.

I say this to the minister: how can Dallas pass on the price when he is a price taker and not a price setter? He is a price taker and that is what the dairy industry is. So, Minister, because of your actions we in the electorate of Paterson lose our biggest dairy, we lose jobs, we lose investment and, sadly and worst of all, Dallas loses out.

There is no escaping this insidious tax. My community is affected. Stroud Community Lodge has seen their electricity bills increase for the July-September quarter from $13,700 in 2011 to $16,840 this year, yet they are using five less billing days and 652 kilowatt-hours less for the same period. So I ask: how does a community-run nursing home pass on its costs to the people in its care? Well, they just have to absorb it. It means either cuts in services or cuts on jobs. Again, the master for mendaciousness would say that people just need to increase their prices. I have to say that in a low-economic community like Stroud, which is made up predominantly of farmers and ex-timber workers, where do they get the money to pay increased prices? What we are going to see is, yet again, another business, a community-run business, massively affected.

It does not end there. Long-term food security is a massive issue for this nation. I have always supported aquaculture as a way of guaranteeing partial supply. I was contacted by Nick Arena of Tailor Made Fish Farms at Bobs Farm on 30 August after concerns were raised that the carbon tax is undermining their business. I visited the facility. Tailor Made Fish Farms is a successful local business involved in innovative aquaculture and hydroponic technology, producing fish and vegetables for the domestic market and proven technologies for the international market. Tailor Made Fish Farms is the largest producer of barramundi in New South Wales and is internationally considered an industry leader in its field, consulting with companies in Australia and abroad. Affordable electricity is crucial for the ongoing viability of businesses like Tailor Made Fish Farms due to the very competitive and price-sensitive market.

Managing Director, Nick Arena, said he is suffering from bill shock after receiving his monthly electricity bill. It has risen dramatically from $7,149 in June to $9,535 in July. I have the bill here. Over $1,000 of this increase has been itemised in the bill as a 'carbon charge'. The average electricity charge for the business has risen from 15 cents a kilowatt hour to 19.4 cents a kilowatt hour since the carbon tax was imposed. The fishing industry is an extremely price point sensitive market, largely being a price taker rather than a price setter. Nick's business will be forced to either absorb the additional carbon tax cost, thereby reducing profit margins, or pass on the cost to consumers, thereby reducing competitiveness and jeopardising jobs.

When I asked Nick what the new carbon tax costs will mean for his business he said: 'This is going to impact on our profitability, it is going to push up our cost of production and it is going to make us less competitive. We will seriously think about not doing any more expansion.' Wonderful. This carbon tax is going to be great for our communities, jobs, business and investment! Here are people with skin in the game who understand the impact. Most politicians on the government side have never worked in a real job. They have gone from university to the union movement to the parliament. They have no real life experience. They have invested nothing in business out of their hip pockets.

We see business being stymied in its growth. We will see job losses. I say 'Well done' to the Prime Minister and to the master of mendaciousness, Greg Combet, because if businesses like Tailor Made Fish Farms—

The DEPUTY SPEAKER ( Dr Leigh ): Order! The member for Paterson will refer to people by their parliamentary titles.

Mr BALDWIN: I did. I will change the title from 'master of mendaciousness', but you did say to me that the only word that is precluded is the word 'lie'. The minister uses 'mendaciousness'—

The DEPUTY SPEAKER: The member for Paterson will refer to him as minister rather than by his given name.

Mr BALDWIN: Okay. Businesses like Tailor Made Fish Farms should be rewarded, not penalised, for their innovation and hard work. It does not matter whether you are a dairy, a chicken producer, a nursing home, a tourist operator, a manufacturer or, indeed, any industry, you have been slugged by this mendacious, deceptive government whose current leader, prior to the last election, said, 'There will be no carbon tax under a government I lead.' Whilst the carbon tax is charged at $23 a tonne—it does apply equally across all energy tariffs—reduced off-peak energy pro rata has gone up by around 30 per cent because of the carbon tax. Yes, peak energy may have gone up 10 per cent, but other tariffs have gone up exponentially because it is a tonne rate not related to the tariff. This government does not seem to get it.

This Labor carbon tax, which is based on a mendacious, deceptive statement to the Australian people, is a dead weight around Australian businesses when they can least afford it. The maths is simple: the carbon tax will increase costs to businesses and households, reduce competitiveness, erode investment confidence and cost jobs. Tourism is extremely important to me, both in my electorate of Paterson and in the portfolio I represent on this side of the House.

The tourism sector comprises some 350,000 tourism connected businesses, many of which are sole traders or classic small businesses, and when combined with hospitality they employ around one million Australians. Everyone in the tourism industry will pay more under this carbon tax. Airfares will increase, bus fares will increase, train and ferry fares will increase, restaurant meals and drinks will increase. All businesses will face a minimum 10 per cent rise and up to a 30 per cent rise in off-peak electricity costs. This will mean higher rates for hotel rooms, higher entry fees for park attractions and higher operating costs for tourism operators. This means tourists will have to pay more. They will have to pay more for a cruise to the reef, more to go on whale-watching trip to Port Stephens on boats like Moonshadow and more to use Brisbane's ferries. They will have to pay more to travel from Tasmania to Melbourne on the Spirit of Tasmania. The costs just keep going up.

Minister, what do you say to the 150 exhibitors at today's Caravan, Camping and Holiday Expo at Penrith? They have seen excessive hikes in their electricity bills. Richard Emerson, from the South West Rocks Tourist Park, has seen his three most recent electricity bills include a carbon charge. He has seen his price for electricity go up $570 in August, $600 in September and $550 in October. I hasten to add that this is also the off season—I shudder to think what the bill will be during the summer months, during Christmas holidays, when people are using air-conditioners and other such electrical appliances. Our tourism industry is a price point sensitive market that can ill afford these increases.

I have heard the mendacious claims from the minister about how this carbon tax will save the Great Barrier Reef. I have been to the Great Barrier Reef on a number of occasions and have worked with people like Col McKenzie, head of the Association of Marine Park Operators. He advised me that Quicksilver, a cruise operator, was going to pay $250,000 in carbon tax due to the six cent per litre fuel increases. Now, under the environmental management charge rebate, they will be rebated $400,000. So they are going to profit $150,000. Good luck to them. By way of contrast, Big Cat cruises—which goes out to Green Island and transports over 100,000 people—has no rebate fees, yet has a fuel bill increase of $100,000 per annum. Where is the level playing field? It is not there. This carbon tax applies to tourism operations in Australia but not if you go to Bali or Fiji.

We are already suffering the impact of a high dollar. What we do not need is a carbon tax that will further disadvantage Australian industry and make us less competitive. What this government does by its actions is support a reverse tariff. Straight after the election I will line up with our leader, Tony Abbott, to get rid of this insidious tax. I seek leave to table electricity bills, seeing that the Leader of the House asked for them today: two electricity bills from Tailor Made Fish Farms showing the increase from $7,149.23 to $9,535.38, and the electricity bills from Stroud Community Lodge showing their electricity bill going up in a 12-month period from $13,736 to $16,840.

Leave not granted.