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Tuesday, 19 November 2013
Page: 711


Ms O'DWYER (Higgins) (19:02): I rise tonight to speak on the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 and related bills. Before the 2010 election, the then Prime Minister Julia Gillard promised she would not introduce a carbon tax under the government she led. At the time, the former Treasurer the member for Lilley supported this statement with this line:

No, it's not possible that we're bringing in the carbon tax. That is a hysterically inaccurate claim being made by the coalition.

We all know what subsequently happened after those infamous words.

On 11 October 2012 the then Prime Minister and her fellow government members cheered in this chamber as they legislated the very thing they promised the Australian people that they would not. They legislated despite the fact that Australia is responsible for less than 1.5 per cent of the world's carbon emissions; despite concerns from Australian business both big and small that they would be put at a competitive disadvantage relative to their global counterparts; despite the fact that costs would go up for business and households; and despite the fact that the government's own modelling revealed that emissions would continue to rise by 77 million tonnes between 2010 and 2020 even with a carbon tax. In legislating for a carbon tax, Labor Party members were cheering for increased electricity prices, greater cost-of-living pressures on Australian families, a less competitive environment for Australian businesses and more complexity and regulation for those charged with administering it.

In the time available to me this evening, I would like to discuss three things: the impact that the carbon tax has had on individuals, businesses and not-for-profit organisations in my electorate of Higgins; whether a carbon tax in Australia does in fact reduce domestic and global emissions; and finally, how we compare to other countries in tackling this global challenge.

First to Higgins. The carbon tax had a direct impact on household electricity bills, increasing them from anywhere between 10 to 15 per cent. But the impact has not been felt by households alone. One of the great small businesses in my electorate of Higgins is the Malvernvale Hotel. The Malvernvale is a quintessential Australian pub and bottle shop, the like of which can be found in any electorate across the country. The first electricity bill that they received after the introduction of carbon tax had a whopping surprise for them. It showed an increased bill from $6,005.38 in June to $7,635.37 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. This is money that could otherwise have been reinvested in the business to employ more people and to help grow our economy. Instead, it was money spent—on what and for what?

The second example in my electorate of Higgins relates to Sam, a family man who runs his own small business, a popular restaurant and bar. When Sam's refrigerator broke down and he called in the repair man post the implementation of the carbon tax, he was not prepared for what unfolded. When he received a bill for the broken carburettor he noticed that the price for replacement refrigerant gas was more expensive than the carburettor itself despite it being a fraction of the cost previously. This is because some refrigerant gas had increased in price under the carbon tax by up to 300 per cent. This is on top of the increase to electricity prices. Sam absorbed this cost in his business as he is very conscious that customers are price sensitive. He said that he was completely unaware that this would be one of the unforeseen impacts of the carbon tax.

The third example in my electorate of Higgins is the impact that the carbon tax has had on one of my not-for-profit hospitals, a hospital that helps thousands of people each year with serious illness. After the introduction of the carbon tax, I was told by the chief executive of that hospital that its electricity bill went up by $345,000 per annum. This of course inevitably leads to the increased cost of health care. These three local examples alone are damning indictments on this Labor-Greens' carbon tax experiment.

We must never lose sight of the justification provided by the previous government when they introduced this tax. They said the tax would reduce domestic and global emissions yet, according to the former government's own modelling, even with the tax, domestic emissions will rise from around 560 million tonnes in 2010 to 637 million tonnes in 2020. Worse than this is the fact that, despite a carbon tax that was set at a price roughly five times higher than its European equivalent, Australia's carbon tax will potentially also increase global emissions. Take, for example, the production of ammonia. According to the TNO report commissioned for the European Commission, it is 35 per cent more energy intensive to produce ammonia in China than in Australia. So it follows that, if it becomes less competitive to produce ammonia in Australia and production is shifted offshore to places like China, there will be a greater output of CO2 per tonne of production that if that production were to stay in Australia. This is the ugly but inevitable truth—the truth that is not told by those opposite—of the carbon tax. By putting Australian businesses at a competitive disadvantage it has the potential to actually increase carbon emissions.

Australian industries have been innovators and pioneers for cleaning up their carbon emissions. The Australian aluminium industry has cut its emissions by 26 per cent since 1990. Since 1990 the Australian cement industry has cut carbon dioxide emissions by 20 per cent per unit of output and reduced the carbon intensity of its product by 24 per cent per tonne. All of this was without a carbon tax and without a price on carbon. If your mission is to reduce global carbon emissions, it does not make any sense to apply an unemployment tax in the form of a carbon tax on the very country that applies some of the world's best practice to manufacturing.

It is not true to say that the carbon tax is the only factor having a negative impact on Australian manufacturing, but it is naive, irresponsible and plain wrong to say that the carbon tax does not negatively impact upon industry, which is why we have brought in these bills to remove it.

How is the rest of the world tackling this global challenge? The Productivity Commission told us that no country currently imposes an economy-wide tax on greenhouse emissions or has in place an economy-wide ETS. In fact, compared to the European ETS at around $7 a tonne covering 45 per cent of total emissions and the New Zealand ETS at around $3 a tonne and covering 50 per cent of emissions, the scope and scale of Australia's $8 billion carbon tax that only goes up and that covers everything is dramatically different. Recently Canada's Prime Minister, Stephen Harper, stated:

Our government knows that carbon taxes raise the price of everything, including gas, groceries, and electricity.

…   …   …

… greenhouse gas emissions are down since 2006, and we've created 1 million net new jobs since the recession—and we have done this without penalising Canadian families with a carbon tax.

It now rests upon the coalition in government to clean up the mess of the carbon tax imposed by the previous Labor-Greens government. The previous government were so proud of this tax, but it was so ill thought through that they needed to significantly change it on more than 10 occasions within a 12-month period. This tax is so burdened with inefficiencies and hidden costs it is widely accepted that business compliance costs alone are expected to fall by around $87.6 million per annum upon its removal. According to Treasury modelling, the removal of the carbon tax in 2014-15 will help Australian households be better off by around $550 a year.

Those on the other side of the chamber know that the carbon tax has hurt families, hurt businesses and hurt our economy. They said so on multiple occasions during the recent election campaign and even claimed that they would terminate it. Former Prime Minister Kevin Rudd declared:

The Government has decided to terminate the carbon tax to help the cost-of-living pressures for families and to reduce costs for small business.

Well, now they have that chance. Yet, according to the Leader of the Opposition, they will again break their election promise and frustrate the mandate that we on this side of the chamber have been given.

We have a plan to reduce carbon emissions. We have a plan that we took to the election. We will meet our target to reduce Australia's carbon emissions by reducing them by five per cent from 1990 levels by 2020 through a direct action plan designed by the environment minister. This is a plan that is costed and capped and that will at its heart provide incentives for business to reduce emissions and will also support practical environmental measures. This will not harm Australian families, this will not harm Australian businesses and this will help our environment. I urge those opposite to listen to what the Australian people have said about the impact of the carbon tax and to repeal it. I commend these bills to the House.