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Tuesday, 11 October 2011
Page: 11360


Mrs ANDREWS (McPherson) (11:55): I rise to speak on the Clean Energy Bill 2011 and related bills. I speak on behalf of the many constituents and residents of McPherson on the southern Gold Coast who have largely been ignored by the Prime Minister and the Labor government.

I was elected by the people of McPherson to represent them in this place and I am here to voice their concerns, along with the concerns of other Australians who never expected to be in the position that we are in today, where we are debating the introduction of a carbon tax, a tax that Labor and the Prime Minister promised would never be introduced by a Gillard government.

The Australian people are now left to watch on, as the Gillard-Brown government attempts to pass one of the most controversial policy changes, while excluding and dismissing their views. The biggest issue that families on the southern Gold Coast are facing right now is the rising cost of living. Since 2007, right across Australia, electricity prices have increased by an average of 51 per cent. In the first nine months of the Gillard government, families were paying, on average, five per cent more for groceries at the supermarket and around 13 per cent more for water and wastewater services. Electricity, food and water are not the only essential items that have seen an increase in price during this period. Fuel, health, rent and mortgages have also cost local families more, stretching budgets to the limit.

What families need right now is a break from price increases, not a new tax that will potentially push them over the edge. The Gillard-Brown government's proposed carbon tax is going to flow down from the mysterious top 500 polluters and into the pockets of consumers. The affected businesses are unlikely to absorb these costs. They will be forced to increase their prices or reduce their own costs by reducing their wages bill either through job cuts or by reducing hours of work. Every time you turn on your TV or your air conditioning, or you boil the jug or go to the shops, you will be paying more. Labor talks about compensation but we all know that compensation is only paid to those who have been injured or have suffered a loss in the first place. We also know that compensation will not keep pace with increased prices in the future. The carbon price of $23 a tonne is not fixed. It will go up and is already forecast to reach over $350 a tonne in 2050.

This is the last thing the people of McPherson need. They have suffered 3½ years of price hikes under the Labor government and around 95 per cent of the local people I have spoken with since the announcement of this tax oppose its introduction. Our local tourism and construction industries are at risk under the proposed carbon tax. The Gold Coast has long been an affordable domestic holiday destination for Australians. With an increase in the ticket price of a domestic airfare, Australians will be penalised for holidaying at home, while those wishing to travel overseas will be exempted.

The Australian Tourism and Export Council believe the impact of a price on carbon is another hit to tourism businesses already facing the significant impacts of the high Australian dollar and the declining number of domestic tourists. They are concerned that thousands of small to medium-sized businesses who operate on tiny margins will close down. The local community here on the Gold Coast relies on the tourism industry's survival because, without it, thousands of jobs and associated livelihoods will disappear.

The construction industry is facing a similar fate, with costs set to increase under the proposed tax. According to a survey issued by the Master Builders Association, the Gold Coast is the toughest place to operate in Queensland. Unfortunately, under the proposed carbon tax, things will become more difficult for this industry. The Master Builders Association has said that the introduction of the carbon tax will raise the cost of new homes and renovations, worsening housing affordability and crippling confidence. Based on a carbon price of $23 a tonne, the MBA estimates that construction costs for a typical 200 square metre slab-on-ground home will increase by between $7,000 and $9,000, without adding additional increases in the cost of transport. These increases could severely impact on the construction industry as people opt out of building or renovating because they simply cannot afford it. There is already a significant number of unemployed construction workers on the southern Gold Coast and we cannot afford to have more workers put off as a result of a decline in the number of housing and commercial projects.

With our tourism and construction industries in despair, we have had to rely on a second layer of industries, including manufacturing and education, to ensure that our local economy stays afloat. As the prospect of a carbon tax is already being evaluated, the future growth of these industries is uncertain, especially in the higher education sector. I will use Bond University as an example to demonstrate my point—and I note that the Joint Select Committee on Australia's Clean Energy Future Legislation accepted Bond University's submission, unlike the numerous submissions made by others, including those from the McPherson electorate, which were dismissed as correspondence.

I recently held a carbon tax forum in my electorate of McPherson and I invited the community to come and share their views on the proposed carbon tax with me. I invited a range of panel members, including Senator Simon Birmingham, to give presentations and to answer questions in relation to the carbon tax. Jim Wilson, the general manager from Connecting Southern Gold Coast, was there as a representative of the small business community, particularly those business owners who were unable to attend the forum due to increased hours of work associated with running their businesses.

Also in attendance to address the community on the impact of the carbon tax on the higher education sector was Chris Hogan, Associate Director, Information and Planning Financial Services, at Bond University. By Australian standards, Bond University is a very small university, with about 4,500 students and around 1,200 staff members on campus. It has made preliminary evaluations on the impact of the carbon tax on its costs. It has calculated the direct and indirect cost to be $2 million.

Bond have advised me that they are expecting to see the following indirect flow-on effects from the carbon tax: rises in electricity and other utilities; additional wage costs of monitoring and reporting data; cost of acquisition of CO2 reporting software; cost of implementation of additional 'smart meters' on campus to pinpoint certain locations and their energy use; appointment of consultants to standardise data and ensure accuracy of data; additional compliance reporting to government; for travel, an estimated $3 increase in domestic flight fares, as per the media story by Virgin Blue in the Financial Review; and wage increase requests to meet the consumer price index. From Bond's own calculations, its total indirect costs are not less than $1.2 million in 2012-13, rising to $1.3 million by 2015-16. In addition to these indirect costs, Bond University calculated the direct costs of the carbon tax at $0.6 million per annum, rising to $0.8 million in 2015-16.

In order to facilitate these costs Bond University has two options: either increase revenue by raising fees or reduce costs through job cuts. Fee increases would impact on Australian students and their families in the local community and would most likely lead to students looking at alternative institutions for starting or continuing their tertiary education. We need to encourage the tertiary uptake rate on the Gold Coast. But rising costs would severely impact on future enrolments in this private institution because, currently, students are unable to access Commonwealth supported places. In addition, Bond University has international enrolments of around 30 per cent of the total student body. If Bond University were to increase its fees in order to save jobs, the international students would also possibly consider studying in other countries that are more competitively priced. Bond University said:

Regarding the potential impact on the higher education sector as a whole, given we expect Bond will be impacted and Bond is very small, it seems most likely that all of the 39 universities in the higher education total sector will also exceed the threshold of 25,000 tonnes of carbon dioxide per year unless the Government decides they are specifically exempted. We could find no such exemption in the Government's information on the proposed carbon tax.

Most other universities are considerably larger than Bond. Bond's expenditure comprises around 0.7 per cent of sector expenditure. If we were to scale up to the sector level Bond's estimated proposed carbon tax impact of $2 million per year, we would get a sector-wide impact of the proposed carbon tax in the range of $200 million to $300 million.

Of course, it is not just the education sector that will be adversely affected by the introduction of a carbon tax. I have been meeting with local manufacturers, many of whom are already facing increased pressure as a result of the high Australian dollar and reduced spending patterns. For manufacturers, the carbon tax may well be the final straw, and I am concerned that there will be an increasing number of organisations taking the difficult decision to close their operations. One of our local manufacturers, the Rock Crush Group, has over 100 years of combined experience in the engineering and manufacturing of winches and dredges, which are exported worldwide. They have been based on the Gold Coast for more than 40 years. When I asked this company how they would be affected by the introduction of the carbon tax, I was told that it would, quite simply, drive their operations offshore. They also said that here in Australia there would be no option other than to make job cuts.

The proposed carbon tax is causing a lot of anxiety within the community. Pensioners and families are struggling to make ends meet and have already had to tighten their belts beyond what is reasonable. Small business owners are also doing it tough. You can see the impact on local businesses in the number of vacant commercial and retail shops and in the higher than average unemployment levels on the Gold Coast. Our not-for-profit community organisations—in particular, local surf lifesaving clubs—are also worried that the carbon tax will close them down. There is an alternative available to the carbon tax, there is a better way. The coalition's direct action plan will cost $3.2 billion and will be funded from the $50 billion in savings that we announced prior to the election. Our plan is fully costed and capped and will not be at the expense of reduced standards of living. It is straightforward, practical and easy to understand. The direct action plan will not destroy jobs; it will protect our economic development and the environment at the same time.

Since Copenhagen many countries around the world have distanced themselves from carbon taxes and emissions trading schemes. The USA scrapped its cap-and-trade system entirely, and the only other existing example of an emissions trading system is the European ETS. However, the European system only costs roughly $1 per person per annum, while the proposed Australian system will cost $400 per person per annum. While Europe's ETS costs $500 million per year, the Labor government's carbon tax will cost Australian taxpayers $9 billion a year.

The Labor government's target to reduce emissions by 80 per cent by 2050 will force the coal industry to cease its operations entirely. Additionally, an estimated $57 billion of Australian taxpayers' funds will be sent offshore to buy carbon offsets to enable Australia to reach this target. Australian taxpayers work hard to contribute to the economy, and what we have here is the potential for our wealth to be transferred away from the Australian people who built it.

I am concerned about reports that indicate that 100 arrests have occurred throughout Europe for the extensive defrauding of the European Union ETS. I am aware of reports that indicate around 90 per cent of the trades in the European Union's ETS were fraudulent, resulting in a loss to European taxpayers of $6.6 billion. Deloitte Australia has even warned that carbon-credit fraud is the white-collar crime of the future.

I would like to conclude today by reminding the Labor government that, when the Howard government introduced the goods and service tax, the people were given the option to decide on the GST. It was a replacement tax—it replaced the wholesale sales tax—and was 15 years in the making. The proposed carbon tax will not replace an existing tax. The carbon tax is a cascading and compounding tax that will affect everyone. I have listened to the community and I will be supporting their views by voting no to the carbon tax.