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Wednesday, 10 October 2012
Page: 11945


Ms O'DWYER (Higgins) (22:42): I congratulate you on your new role, Madam Speaker. I rise to speak on the Clean Energy Amendment (International Emissions Trading and Other Measures) Bill 2012 and six related bills. We are now witnessing through this package of legislation the eighth change to the carbon tax since its inception only a few months ago. These changes include bailing out major companies using taxpayer funds on the eve of the carbon tax being introduced, including funding to Energy Brix and Alcoa; decreasing the share of clean tech investment grant funding for small businesses so as to further increase funding for big businesses; the Clean Energy Regulator adding more businesses to the big polluters list, taking the total now to 315; changing the regulations so as to increase real emissions from pipelines and landfills by one million tonnes; abandoning the Contract for Closure program to shut down power stations, which will mean that the carbon tax will have to increase to achieve the same emissions reductions; linking the scheme to the European system, which does not allow a two-way trade on carbon credits, putting Australian businesses at a disadvantage and resulting in Australia's carbon tax being set by the EU price; halting the Clean Technology Investment grants only weeks after the grants were announced and then changed; and now scrapping the floor price, which was to have been $15 from 2015.

It is unbelievable to be standing here watching the same government ministers and members who only a few months ago argued until they were blue in the face for the need for a floor price for the carbon tax now arguing the complete opposite, that it is vital that we remove it. Only in July they were saying how critical a floor price was to provide certainty to business, and now they are arguing that those very same arguments no longer apply. It is breathtaking to see the Minister for Climate Change and Energy Efficiency counter his own arguments of only one month ago. It is like he is having a debate with himself and does not know which side to take. 'There will be no carbon tax.' 'No, there will be a carbon tax.' 'We will buy out brown coal power stations.' 'No, we won't buy out brown coal power stations.' 'We need a floor price.' 'No, we don't need a floor price.' I would love for just one member on the opposite side with any conviction to stand up, make a stance and say, 'Enough of this farce, enough of the dishonesty, enough of the backflips and enough of the hypocrisy.'

This is a government that is simply being politically expedient at every opportunity to preserve power. But do not take my word for it. Let us look at the words of the climate change minister himself. In July this year he stated, 'We've put in a floor price and a price cap to provide some confidence over the first few years about potential variability in the price.' Why was it so critical in July but not so critical now? Is confidence in potential price variability no longer an issue? Maybe that is because the European price has plummeted so much that there is now certainty it will be very low. In 2011 the minister said of the floor price, 'This will reduce risks for businesses as they gain experience in having a market set the carbon price.' So I assume that the minister for climate change is now saying that he is deliberately increasing risk by exposing Australian businesses to price fluctuations in the European pricing system—a pricing system that has, let's face it, gone from over $20 a tonne to now less than $10 a tonne. He simply cannot have it both ways.

It is not only the climate change minister that has been caught out arguing both sides of this argument. Many other ministers have done so as well, including the Prime Minister. On the issue of the floor price the Prime Minister has said, 'Well, we just thought for stability, particularly when we move to an emissions trading scheme where the market is setting the price, that it was wise for a period to have bands, a ceiling and a floor.' Does that now mean the government is being unwise? If we judge the Prime Minister by her own words, then certainly she must be. When originally debating the legislation she said, 'The bill also provides for a price cap and a price floor to apply for the first three years of the floating price period. This will limit market volatility and reduce risk for businesses as they gain experience in having the market set the carbon price.' Again, by her own logic, by removing the floor price they are supposedly now increasing the risk for business.

The Parliamentary Secretary for Climate Change and Energy Efficiency also got in on the act, saying of the floor price:

For the first three years of a flexible price emissions trading scheme there will be a price floor mechanism that aims to ensure the price of permits do not fall below a pre-determined level. A price floor provides participants with greater certainty upon which abatement decisions to make. For those investing in abatement technologies whose value is sensitive to the level of the carbon price, a price floor helps reduce downside risk.

The Minister for Finance and Deregulation stated:

It is the case that our policy does include a price floor which acts as a safety valve for investors in low-emissions technology by establishing a minimum price for the first few years of a flexible price period.

So now we have a finance minister who, by her very own words, wants to remove the 'safety valve for investors' and therefore increase risk and uncertainty. Some government! Some ministers! These are, let's face it, flawed policies at best.

The people who truly suffer because of this are the people of Australia and the small businesses of Australia. The government needs to learn that there are consequences to their actions and, although they themselves may not be directly affected, people out there in the real world are. Take, for example, the Malvernvale Hotel, which is located directly opposite my electorate office. They most certainly are affected by this carbon tax. The Malvernvale Hotel received their first power bill after the introduction of the carbon tax, only to discover that it had increased from $6,005.38 in June to $7,365.37 in July—a rise of $1,359.99. For the month of July the carbon charge was $1,162.87, which represents 85.5 per cent of the increase and 15.8 per cent of the total bill.

The Prime Minister tells us that the modelling shows that the carbon tax will only contribute to a 10 per cent increase in electricity prices. But here I am, evidence in hand, proving that the modelling is wrong—not just wrong but wrong by over 50 per cent. That is a cumulative, increased cost to the business of $12,000 per year—over $12,000 per year this small business now needs to find. There is no compensation for them. There are no bailouts for this small business, just increased costs, fewer staff or both.

The Prime Minister can tell us all stories about poles and wires. However, whilst she is deliberately increasing electricity prices through the carbon tax, it all stands for nothing. It is the height of irresponsibility and arrogance for the government to refuse to redo the modelling after making such fundamental changes to the scheme. Presumably, if these changes are so valuable, they would find the updated modelling favourable. But it is not so. We know why the government refuse to redo the modelling. It is because it would ensure that Australians were made aware that we are looking at more uncertainty, higher costs and less opportunity.

The reason we oppose this legislation and the reason we oppose the carbon tax is not just because the people of Australia do not want this tax. It is not because the Prime Minister and the Treasurer attempted to ridicule us for suggesting that the Labor Party were going to introduce a carbon tax when they said they would not. It has nothing to do with the personality of any member of this House. The reason we oppose it is simply that it is bad policy that Australia can ill afford, especially in the economic climate we find ourselves in now.

Do you know how I know that this is true? Member after member on that side of the chamber stand up to talk about the need to act on climate change, but they refuse to talk about the details. Like all other policy areas, they are high on rhetoric but absent on substance. And why is that? Put simply, they have nothing. They cannot explain why the Australian people should pay the world's highest carbon tax, one that forces up the price of electricity. They cannot explain why Australian businesses should be at a competitive disadvantage to their international neighbours, only to send jobs overseas. And they cannot explain why they could not be honest and upfront about the introduction of a carbon tax prior to the last election. After all, if it was such a good idea, surely the Prime Minister would have been upfront about it before the last the election.

There is a better way—a way paved by fiscal responsibility and a commitment to keep promises to the electorate. That way is the way of a coalition government, and I commend that way to the House.