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Monday, 21 May 2012
Page: 4828


Mr DREYFUS (IsaacsCabinet Secretary, Parliamentary Secretary for Climate Change and Energy Efficiency and Parliamentary Secretary for Industry and Innovation) (20:15): Yet again we are seeing another attempt to get some relevance for the opposition on the issue of climate change. Like so much else of what the opposition have done in this policy area, it rests on deceiving industry and deceiving the Australian people about policy, manufacturing and the carbon price. It is just more empty grandstanding, more hysteria and, indeed, more of the shameful pretence from the opposition that they actually have a policy that might just possibly reduce the carbon pollution that is the problem we are intending to deal with. They say that we should engage in the reduction of carbon pollution, but, of course, they have no policy—and if I have time I will come back to that.

We have again more crocodile tears from the opposition, who pretend, and only pretend, concern for manufacturing—and this, of course, from the architects of Work Choices. I see that the opposition spokesman is now fleeing from the chamber. He is not prepared to stay here to support the bill that he has introduced, having put forward nothing more than just effectively hysteria—and I will explain why in a minute.

I have some news for the opposition: pretending to care about the renewable energy industry and then opposing a carbon price is not a credible climate change policy. Wearing fluoro vests and visiting factories all over Australia is not a manufacturing policy. Endless opposition and mindless negativity are not in Australia's best interests, but we have just heard again from the member for Flinders a bit more of that. If the Leader of the Opposition is a cheap hypnotist, then the member for Flinders is nothing but a tawdry clown. Who else but a clown would have written their university thesis on 'A tax to make the polluter pay' and then advocate for the biggest policy joke this century, the so-called direct action policy, which is what the opposition is putting forward?

The facts are that the Gillard government has provided more support to renewable energy than any other government in Australian history. I want to outline some facts on the solar hot water scheme. When the carbon price scheme starts on 1 July, the solar hot water industry will be receiving support in four ways. First, the carbon price itself will create a stable, long-term market and will provide incentive right across the economy for the shift to renewable energy. Second, the Low Carbon Communities program, part of the clean energy future plan, will provide $330 million to councils, communities and low-income families to improve energy efficiency in homes and buildings. Of course, solar hot water is very energy efficient and we expect that, as part of the grants that will be provided under the Low Carbon Communities program, there will be a very great deal of support for solar hot water. The third means of support under the carbon price scheme is the $800 million Clean Technology Investment Program, which will give the solar hot water industry an incentive to retool and modernise the manufacture of these units. Of course, it is not just the solar hot water industry that will be advantaged by that Clean Technology Investment Program; industry right across Australia will be assisted to improve efficiency and modernise. Last, but not least, is the support for the industry right through to 2020 through the renewable energy target. Essentially, consumers can be offered up to a $1,000 discount in STCs, or small technology certificates, and that will continue. That renewable energy target will continue and the small technology certificates, which are available to solar hot water, will also continue.

Our current policy settings are designed to transition to a clean energy future, and it is a future that includes solar hot water. The member for Flinders has engaged in his usual historical fictions, as he does with all aspects of our policy but particularly the solar hot water rebate. The solar hot water rebate was always going to end on 30 June this year and it is ending on 30 June this year. This was what was planned. I know this will come as a shock to some of those opposite or to any newer members of the opposition, but this was planned when this rebate was established by the last Liberal environment minister, the member for Wentworth, when he announced the solar rebate scheme on 17 July 2007. What the member for Wentworth as the then minister for the environment said was that this was going to be a transition. This was a scheme to provide support for solar hot water as Australia transitioned to an emissions trading scheme, which was, of course, by then the policy of the Howard government. That is why the Howard government established the greenhouse gas reporting arrangements, which we are still using. That is why the Howard government went to the 2007 election supporting an emissions trading scheme. This bit of policy, the solar hot water rebate, was intended to be a transitional policy—and, I might add, the hot water industry has been well aware of this fact. Indeed, websites of solar hot water companies in February this year stated, showing their awareness, that the rebate scheme was going to finish in March. All that has happened here is that the scheme was formally announced as ending on 30 June this year. As at 28 February, under the long established guidelines for this rebate scheme, customers had four months to lodge their rebate applications. Four months from 28 February, as it happens, is 30 June. This scheme is ending on time as it was always destined to. It has not been scrapped. It has not been closed early. It is not being ended. It is a scheme that was introduced by those opposite when they actually understood something about market mechanisms, when they were actually true to their principles of supporting market incentives, market mechanisms, a carbon price and an emissions trading scheme. They announced this program. They established this program as a transitional program intended and announced by them to be a five-year program. We have continued this program for five years. Indeed, we have expanded the program over the course of our government so as to put more money into it than the Liberal Party was intending to when they started this scheme. But its timeframe, its life if you like, is exactly as has always been planned since the inception of the scheme—not scrapped, not being closed early. It is simply being ended in accordance with the guidelines, in accordance with announcements that have been made by successive Australian governments since this scheme was established on 17 July 2007.

I heard the member for Flinders refer to a bridge, and that might perhaps have betrayed some limited understanding, but I do not think he was actually talking about the fact that this was always intended to be and has been a bridging program that was meant to finish upon the introduction of a carbon price. Logically, with the Clean Energy Future plan coming into operation and with the carbon price coming into operation on 1 July, we have this solar hot water service rebate scheme finishing on 30 June. Households and industry will continue to benefit from Gillard government programs in every sense. I have outlined the ways in which the Clean Energy Future plan is going to continue to benefit the solar hot water industry in particular.

What we have got here is a bill, again, true to form for those opposite with all their economic illiteracy we have seen recently, which is a fiscally irresponsible bill that is the sort of stunt one would expect to see from an opposition which has a $70 billion budget black hole that has not been explained to the Australian public. That is not my figure. That is the figure of the opposition spokesman for finance, confirmed by the opposition Treasury spokesman, the member for North Sydney. There is a $70 billion black hole that the opposition has not explained. We will not be reopening the solar hot water rebate scheme. We will not be agreeing to this bill. I need to be clear. We have made it clear at all times when we will close the program and on every day since that we will not be reopening this program.

I need to deal with something else that the member for Flinders has raised. We never intended to make savings from this program. I am very pleased that the member for Flinders has read part of the letter that was tabled in the Senate by the Leader of the Australian Greens party, Senator Milne, in which I confirmed that it was not the government's intention, when we announced that the program was closing with effect from 30 June, to make savings from the program. At the time of the announcement on 28 February, we did not know the full extent of the underspend. We thought that it was possible that there would be some underspend. What was not understood on 28 February, but is understood now, is that there had been a very direct decline—and this is something that many parts of Australian manufacturing have had to deal with—in the uptake of the solar hot water service rebate program as a result of the high dollar making other competing technologies, notably the instantaneous gas hot water technology, which is imported, cheaper. In fact I should mention that some of it is imported by Rheem, one of the manufacturers referred to here, which imports a product that directly competes with the solar hot water services it makes. As a result of quite steeply declining uptake in the program through December, January and February, it is clear that there will now be an underspend. Again, as I have indicated publicly, as Senator Milne understands and as she indicated when she spoke on the equivalent bill put forward by Senator Birmingham in the Senate, any underspend will be used to continue supporting the transition Australia is making to a low-carbon economy and that will include supporting solar hot water.

This government has provided more support for renewable energy, more support for technologies that reduce carbon pollution in the Australian economy than any other Australian government in history. All we have from the member for Flinders today is a pathetic misreading of the budget papers. I suppose that is what one would expect from an opposition that has a $70 billion hole in the savings that it will need to make to meet the kind of commitments that it has already made in its projections and promises. We have an opposition that would wish to engage in a fantasy—that is the right way to describe it—that it too has a plan that will support the transition to a cleaner economy. The so-called direct action plan of the opposition is not a plan at all. It is a plan that would see a cost of some $1,300 per household inflicted on the Australian community where households pay for money in bucketloads to be sent to the heavy polluters. It is, if you like, a weird inversion of the government's policy. Even then, so far as the direct action plan can be understood, it is not one that anybody thinks can achieve the bipartisan target—the one that the opposition says that it is supporting, which is a five per cent cut in 2000 emission levels by 2020.

We have been talking with industry. I have been talking to Rheem. I have been talking to Dux. I have been talking to the whole industry. I have been talking to installers. Of course I have been talking to crossbenchers and I have been talking to state governments about how the underspend, when it is finally determined, can in fact be used to ensure that it is there to continue to support renewable technologies and to continue to support solar hot water. That is what responsible governments do, not put forward—as this opposition has done—an entirely fiscally irresponsible bill which would seek to continue a demand-driven program. Members might like to contemplate what reopening a demand-driven program might do in a budgetary sense. What it would do, very directly, is simply create an enormous spike in demand, with a great threat to the integrity of our budget. That is not an appropriate way in which to manage the finances of the Commonwealth. Demand driven programs—all Treasury guidelines make this clear—need to be very, very carefully handled and that is what has occurred here. We have avoided the demand spike that quite a number of demand driven programs have become known for. This program has been ended in an orderly fashion. We will not be supporting the opposition's Solar Hot Water Rebate Bill 2012 [No. 2], which is a stunt that would seek to reopen this program in an entirely fiscally irresponsible way. Indeed, it is a program that we can now say was already in decline. We rely on a comprehensive set of policies that is contained in the Clean Energy Future plan.