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Wednesday, 14 September 2011
Page: 10028


Mr RUDDOCK (Berowra) (11:15): In a debate of this type, it is very interesting to focus on the comments of the member who spoke before you because they sometimes bring the issues into clarity. What interested me was the member for Moreton's statement that the world was about to follow our lead. This is about Australia leading the world—that is the comment that was made—and it is, I think, the major difference between the government and the opposition in relation to a price on carbon. I would be encouraged if I believed the world was about to follow our lead, but I see little evidence of that.

I am strongly of the view that Australia should play its part in concert with the rest of the world, but there is no evidence, following the Copenhagen conference, that even the enthusiasm that was evident at Kyoto will continue. There is another conference planned, in Durban, and there is no evidence yet that suggests that the major emitters of the world are going to respond positively, with new initiatives, then. It is important to understand, whether or not you accept the science, that Australia produces a little over one per cent of the world's emissions. Our acting alone, our 'leading the world', will not make one iota of difference to climate change, if the evidence is as the member for Moreton suggests.

The reason I wanted to speak in this debate was to spell out my own views. I am not a climate change sceptic. I am one who is strongly of the view that, if the evidence is that clear and unambiguous, the world would want to respond and in that context Australia should play its part. I am not of the view that Australia should be trying to set some example which it hopes, after disadvantaging itself in world trade terms, others will want to pick up. It is very interesting to look at the way in which this issue is progressing. Even the participants in the global carbon market have told the World Bank that they are pessimistic about the likelihood of any new, globally legally binding treaty being reached on climate change in the near future. I think that really is the test that we have to look at in relation to these matters as we debate this Clean Energy Bill 2011 and the related bills today.

There are commitments that have been made by the opposition, to the Australian people, as to how we can deal with these issues in a modest way, directly, out of the budget, with budget savings, without the imposition of new costs on Australian businesses and industries and without destroying our international competitiveness. This is not a question of Australia being left behind. This is a question of whether we ought to tie one hand behind our back and leave ourselves exposed internationally to the loss of markets for the sorts of products that we are able to produce and allow others to produce goods and services and put them on the Australian market in circumstances where Australian industry cannot compete. So, for me, the major issue with this new tax is that it is the worst possible time for Australia to be destroying its international competitiveness.

Let us look at what is happening around the world right at this time. In the United States, there is the possibility of a second or double-dip recession. They are looking at unemployment rates in excess of nine per cent and growing. They are grappling with in the order of 27 per cent of their population living in poverty. This is a situation in which the United States is unlikely to be able to lead Australia out of the very difficult environment in which the world is operating. In Europe—and it is in the United States and Europe that people are expecting serious activity in terms of limiting potential climate change—what are they worrying about at the moment? They are worrying about whether the banks in places like Portugal, Spain, Italy and Greece are likely to survive and whether the governments of those countries are likely to be able to keep them within the European Union.

This is a diabolical time for Australia to be tying one hand behind its back in terms of its international competitiveness and to believe that we are able to lead the rest of the world. The fact is that under this legislation Australia's manufacturing industry, which is already under pressure, will face a carbon tax which will increase costs and which our overseas competitors will not have to pay. Jobs in Australia will be going offshore as a result. If other countries were imposing similar taxes or implementing an emissions trading scheme which imposed additional costs, it might not be as difficult or as diabolical for us. But the fact of the matter is, and it has been acknowledged, that in the United States all efforts towards a national cap-and-trade scheme have been abandoned. There are suggestions that in one or two states there may be some initiatives.

Europe has an ETS, but it does not cover the whole economy. It provides industries with free emissions permits. I saw reports from Emma Alberici on the ABC about the way in which people are avoiding their obligations under the ETS in Europe. It raises only about $500 million whereas Labor's carbon tax will raise over $9 billion a year from Australians. The government claims that China is acting to reduce its carbon emissions, but we all know that emissions in China are forecast to rise by 500 per cent by the year 2020.

We are pursuing an initiative which will have no appreciable impact upon climate. The CO2 emissions for Australia will continue to increase, according to the government's own statements, from 578 million tonnes to 621 million tonnes between 2012 and 2020. Even Professor Flannery, one of those people whose comments they adopt, observed:

If we cut emissions today, global temperatures are not likely to drop for about a thousand years.

When you are dealing with observations of that sort it is very important to understand that, in the climate in which we are disadvantaging ourselves, we are not going to appreciably change anything when others have not essentially come on board.

The other matter I want to deal with is Labor's claims about the nature of this package. This package will clearly disadvantage Australian industries. It will lead to people losing jobs. Labor claims that families will be compensated for the price impact of the carbon tax. I do not know why you impose a tax if you are going to compensate people for it. There seems to be a little disconnect there. We now know that the compensation will be only 50 per cent of the carbon tax revenue going to families as compensation for the direct cost of living hikes. We know that pensioners, self-funded retirees, small businesses and people who struggle to be able to make ends meet will be facing very significant increases in their costs. This $9 billion carbon tax will see, for instance, electricity prices go up considerably. In Sydney, where I live, we have faced significant hikes already under the former state Labor government. We will see as a result of this measure a 10 per cent increase in electricity bills alone in the first year and a nine per cent increase in gas bills for the same year.

Mr Perrett interjecting

The DEPUTY SPEAKER ( Ms K Livermore ): Order! I beg your pardon, I was reminding the member for Moreton that he should be listening in silence.

Mr RUDDOCK: Was he being rude? Thank you, Madam Deputy Speaker. Higher marginal tax rates for lower and middle income earners will be a consequence as well. In addition, its proposals will have an impact on the budget. These are very significant issues for the Australian community. As I said in my initial remarks, I am not a climate sceptic. I am prepared to see Australia play its part, but I do not believe Australia ought to be leading the rest of the world, as the member for Moreton suggested.

What I want to do today is to put in context some of the comments that the government members have been making about former Prime Minister Howard and the commitments made by the former Howard government. It is important to understand that the Howard government was quite prepared to be part of a world solution, but John Howard in his own comments since Copenhagen has made clear his disappointment that the rest of the world was not ready to come on board at that time. That had an impact on his view as to the way in which the commitments that were made by his government ought to be seen.

I say to honourable members opposite that if they want to know the way in which substantial tax reform ought to be implemented in this country they should follow the lead of John Howard. John Howard was a Prime Minister who was able to put in place very clear and significant tax reform. Its impact on the Australian economy has been commented on favourably. The Howard government went to the Australian people seeking a mandate for the direct tax change—that is, the GST—that it intended to implement. Members opposite have been prepared to say that Howard at an earlier point in time said 'there would be no GST under a government I lead'. He conscientiously went to the Australian people at another election after he made that commitment. I remember well fighting the election campaign on that issue. That is quite opposite to the way in which this government is endeavouring to implement this change—I will not call it a reform.

This change is clearly a change that the Prime Minister said before the last election should not be anticipated. But, even worse than that, the government are trying to force this issue through the parliament without adequate scrutiny. I encourage them to look back and even to reconsider the approach they are taking and use the approach the Howard government agreed on in the consideration of the GST. The Howard government and the coalition agreed to four separate parliamentary committees to inquire into the GST. They had four months in which to report. No debate on the measure occurred in the parliament after the introduction of the measure. All the committees had non-government majorities and were overwhelmingly chaired by Labor. The coalition submitted itself and its policies to total public scrutiny, and there is the difference.

We are debating this measure today that was introduced into the parliament only on Tuesday, yesterday. We are debating it knowing that there is to be one committee that will scrutinise it, with very little time to be able to thoroughly address those issues, and knowing that the matter is being considered under a guillotine. This is not the way in which substantial economic reform in this nation, if it is claimed to be that, should be achieved. The Howard model was far better, more appropriate and far more honourable because John Howard sought to make changes after he had the endorsement of the Australian people at an election. These proposals have never been endorsed by the Australian people at an election.