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Tuesday, 5 July 2011
Page: 3991


Senator BIRMINGHAM (South Australia) (12:33): Thank you, Mr President. I start by taking this first opportunity that I have had to congratulate you on your re-election to office. Fort­uitously now, Mr Deputy President, I congratulate you on your election to this office which, as a new holder of this office, is indeed a most worthy and appropriate appointment. I know that all in the chamber welcome your ascension and know you will do a fantastic job.

I rise to speak on the Carbon Credits (Carbon Farming Initiative) Bill 2011, Carbon Credits (Consequential Amendments) Bill 2011 and the Australian National Registry of Emissions Units Bill 2011. These bills, as the explanatory memorandum states, seek to implement the Carbon Farming Initiative, which is described as being:

… a stand-alone scheme but would be complementary to a carbon pricing mechanism, which the Government has announced would exempt agricultural emissions.

Clearly we do not yet know what the Carbon Farming Initiative would be complementing, given the details of the government's carbon tax—or their carbon pricing mechanism, as they like to say—are possibly yet to be decided but are certainly yet to be released, and we wait until Sunday for their release.

Indeed, even within the Carbon Farming Initiative legislation we do not yet know much of the detail because, so far as legislation goes, this is one upon which much hangs on the regulations. The regulations are utterly critical to this bill, so I foreshadow that at the conclusion of my remarks I shall move a second reading amendment, and that second reading amend­ment shall be that further consideration of these bills be an order of the day for three sitting days after a draft of the final regulations relating to the bill are laid on the table. That, of course, would mean not only that we would have the opportunity to see the full details of these bills and the commensurate regulations that go with them but equally that we would have the opportunity to consider how this bill interacts with the government's carbon tax, so we would be able to have a full and complete understanding of the picture of this—something, sadly, that is so lacking at present.

I move such a second reading amendment not because the opposition has problems with the overall direction of this legislation. It is, of course, key legislation. It is very important and it complements—or could complement, if drafted correctly—the oppo­sition's own policy when it comes to climate change: our direct action policy on climate change, which does place particular store on opportunities to abate carbon through better land management practices and the like. This legislation could achieve that.

The bill has three stated objectives. They are: firstly, to help Australia meet its international obligations under the United Nations Framework Convention on Climate Change and the Kyoto protocol to that framework convention; secondly, to create incentives for people to carry on certain offset projects, being land sector abatement projects, which could be any land manage­ment practices or activities that enhance biosequestration or reduce agricultural emissions; and, thirdly, to increase carbon abatement in a manner that is consistent with the protection of Austra­lia's natural environment and improved resilience to the effects of climate change. These are, we believe, all worthwhile object­ives. That is why our concerns about this legislation do not lie at the heart of its being, are not about the goals which it seeks to achieve or implement, but are about the detail of the legislation and how it will actually be implemented through the regulations and through its interaction with the carbon tax.

We do welcome the fact that the govern­ment through this measure are pursuing a form of direct action, are pursuing an activity that is not unlike the policy of the coalition. I note that, so far as we can pick up any details of what the government are proposing for their carbon tax regime, we see that more and more parts of it start to resemble the direct action policy. I read in today's Age newspaper that in fact there will be a separate clean energy finance corporation established as part of the govern­ment's carbon tax regime. It would be nice if we knew all the details of this and if we did not have to pick titbits out of newspapers and actually could question the government on it, using the full parliamentary procedures of this place to have a real debate about the carbon tax today, tomorrow and Thursday while parliament is still sitting. The government obviously know the details and they are just choosing to hide them from the Australian people and, of course, from scrutiny in this place by this parliament. Only the government know why they are afraid to front up to question time today, question time tomorrow and question time on Thursday and actually answer questions about their carbon tax. Instead, they are waiting until Sunday to release it when they know the parliament will not be sitting for many weeks. They hope, of course, to avoid as much scrutiny of this proposal as they possibly can.

But we learn from these titbits that are dripped out through coordinated leaks to try to make the government look a little bit better—a strategy that I would suggest is not working terribly well at present—that apparently a new clean energy finance corporation will be created to oversee up to $2 billion a year in seed funding loans for projects trialling large-scale renewable energy technology. It is further understood, according to these leaks, that it will include a multimillion dollar tender round to buy out and shut down about 2,000 megawatts in brown coal power generation, an offer that is expected to interest the owners of Hazel­wood and Yallourn plants in the Latrobe Valley.

There we have it; it is going to include a tender round to provide funding to achieve emissions abatement or reduction. What does that sound awfully like? It sounds awfully like the coalition's emissions reduction fund, a tender driven process through the market to find the most efficient means of actually delivering emissions reductions.

Senator Feeney: The command economy!

Senator BIRMINGHAM: That, of course, is what we have been proposing for quite some period of time, since February last year. Throughout that time line, as Senator Feeney would well recall, the government has had a policy of flip-flopping on what it is going to do on climate change, a policy that back in February last year was still committed to having an emissions trading scheme under Mr Rudd. Then we saw Mr Rudd convinced, by Ms Gillard, that he did not want an emissions trading scheme. Then we saw Ms Gillard roll Mr Rudd and promise there would never, ever be a carbon tax under a government she led. Then we saw Ms Gillard sit down with Senator Brown and Senator Milne and suddenly say, 'There will be a carbon tax and I am happy to call it a tax', until last week when she said: 'I'm no longer happy to call it a tax. It is not a tax.' This week I think she is back to calling it a tax, but maybe Senator Feeney can clarify for us as to whether the carbon tax is a tax or not a tax. Perhaps he can answer that for us.

Senator Feeney: I'd be delighted to; I'd love to.

Senator BIRMINGHAM: I welcome the fact that it appears the government are slowly coming round to the coalition's policy. I just wish that the government, through this tender process that they are going to have, through their clean energy finance corporation, through their commit­ment to carbon farming, would actually accept that there is a better way than a carbon tax. It appears as though the only reason for your carbon tax at present is going to be to fund direct action initiatives like this clean energy finance corporation. It would appear as though you are going to implement a carbon tax so you can raise the dollars to be able to fund these activities. Here is a clue: go back to the budget, cut the waste out and fund it that way. Then you will truly be embracing the coalition's alternative policy of direct action. You will truly be imple­menting a policy that then does not cost the Australian taxpayer, the Australian economy, put at risk Australian investment and Australian jobs—does not do all of those negatives and as a result rakes in billions of dollars, which you are now going to use for your own direct action purposes. How about you go back and run an efficient govern­ment? You can commit the money that way to pursue these types of projects.

The coalition, of course, does not just welcome where the government is embracing direct action; in this regard we support the principle of carbon farming. The idea of providing incentives to farmers and other land managers to undertake projects which reduce greenhouse gas emissions is a very important one. But we do have significant concerns about this bill. We highlighted a number of those concerns during the Senate committee inquiry process. Coalition senators actively participated in that, and I pay particular tribute to my colleagues Senator Colbeck, Senator Nash and Senator Fisher, who were active participants in that inquiry and indeed have followed very closely the detail of this legislation. Senator Colbeck, in particular, has highlighted a range of very valid concerns about this legislation, many of which were encap­sulated in the report. Even the government in its report made not just the usual passing recommendation that the bill be passed; the government itself made nine recommend­ations in the body of the report. So we see amongst the government's own members and senators a range of concerns about the process for the development of this legislation and about things that actually need to be changed in this legislation. I note that at this stage I have not been provided with or seen any proposed government amendments, but I would hope that the government listens to its own senators on this legislation and that we will see in the course of debate some government amend­ments to complement those that the coalition will be moving and those that the Greens will be moving. We all want to see this legislation work, but for it to work it has to provide an appropriate framework—a framework that, yes, allows the emissions abatement and reductions that are so important but does so in a manner that preserves and protects our prime agricultural land and that has the certainty for those who choose to participate in carbon farming so that they know what the benefits, oppor­tunities and risks will be and can make certain judgments there. In making those judgments they are also, of course, going to need to have knowledge at a level of detail that is not in this bill but will fall within the regulations.

The government has started consultations on what are called the positive and negative lists that will complement this. Those consultations are important, because those lists are critical. They will essentially identify projects or activities that are approved for inclusion under carbon farming and those that will be restricted. But, until those consultations are complete and we see the final set of those regulations, we have serious concerns.

Government senators, Greens senators and coalition senators highlighted issues regard­ing the proposals for NRM groups to be involved. We came at them from slightly different perspectives and we have some concerns on this side about whether these groups have the planning expertise and the like to make sure they can do the jobs that they are tasked with here. We do note that recommendation 6 in the majority report urges that those requirements should be finalised, as a minimum, before the passing of this legislation. We highlighted in the other place during the debate on this legislation particular concerns around state sovereignty and Indigenous land rights issues. These are very serious issues, and I foreshadow that there will be amendments from the coalition in this regard that will be pursued particularly by my colleague Senator Cormann. There are direct concerns that come especially out of Western Australia on this matter. Dr Washer spoke at length on this in the other place, and we will be making sure that we pursue those issues thoroughly in the debate in this place as well.

There are questions and concerns about definitions of 'permanence' in terms of the storage of carbon and how long that storage must be guaranteed in regard to the recognition of those credits and those units. These are serious issues, because the liability created for a party by saying they have created these units but they have to guarantee them for 100 years may in many cases be too great and simply scare people out of participation. This was one of the strange things about the inquiry into these bills. We heard in many ways two conflicting arguments as to why it would not work or why it was a risk. One was a concern that the legislation had too much potential or capacity to open up farming land in a manner that could see it taken over as carbon sinks and in doing so, of course, deprive Australia of some of its key farming lands. On the other hand, we heard from a lot of witnesses during the inquiry into this legislation that the requirements for people to engage in and benefit from the Carbon Farming Initiative were so onerous that you probably would not see anybody participating and that in fact this legislation could be a wasted opportunity. Once again, so much of that will hinge on getting the regulations right as well as getting this legislation right. That is why we see it as so important to see everything and get it on the record before we allow this legislation to pass through this place.

So I foreshadow a range of amendments from the opposition. In particular, I move the second reading amendment that I foreshadowed earlier:

At the end of the motion, add:"and further consideration of the bill be an order of the day for 3 sitting days after a draft of the final regulations relating to the bill is laid on the table".

That amendment would see debate on these bills adjourned until a time three sitting days after the draft of the final regulations relating to the bill are laid on the table. We think this is the most sensible way to go. We do not propose it to be obstructionist. We do not propose it to propose unnecessary delays. We propose it simply because we think that it is important that everyone get to see the full story before we finalise these bills. It is absolutely critical that we understand the regulations, their interaction with the legislation and the overall interaction between this Carbon Farming Initiative and the government's carbon tax. This govern­ment has too much of a track record of approaching these issues in a piecemeal way and has too much of a track record when it has come to implementing climate change policies, be they the Green Loans program, the Green Start program or the Home Insulation Program—climate change policies that have gone terribly, terribly wrong.

It is time the approach to managing climate change in this country is put on a holistic basis and that we actually look at the interaction of one set of legislation with another set of policies. This government says it is committed to having carbon pricing—a carbon tax—whilst we think there is a better way. If it is determined to proceed down that path, we believe we should be looking at this Carbon Farming Initiative in the full context of the carbon tax, how that should eventually turn into an emissions trading scheme, how it will relate and how the potential use of credits could relate. These are not totally unrelated matters. That is why it is important that they be considered together. So I would appeal to the house to give serious consid­eration to the second reading amendment that I have proposed. I would urge all senators to see there is wisdom in waiting; wisdom in ensuring that we actually have all the cards before us; wisdom in giving all of the stakeholder groups—be they the farming groups, the forestry groups, the environment­al groups, the natural resource management groups; all those who are key stakeholders in this process—the chance to see the full package and make their decisions based on that. We should inform our debate based on that. It would allow us to make sure the legislation is right and allow the government to make sure the regulations are right and the interaction with whatever their carbon tax will be—should it, sadly, pass this parliament—is right. That would be the appropriate thing for the Senate to do. I hope that senators will support this amendment.